PR Newswire | Aug 6, 2020 06:31AM EDT

08/06 05:30 CDT

Tenneco Reports Second Quarter 2020 Results LAKE FOREST, Ill., Aug. 6, 2020

LAKE FOREST, Ill., Aug. 6, 2020 /PRNewswire/ -- Tenneco (NYSE: TEN) reported second quarter 2020 revenue of $2.6 billion, versus $4.5 billiona year ago. Excluding unfavorable currency of $108 million, total revenue decreased 39% versus last year, with the decline in revenue from lower light vehicle industry production, down 45%* versus last year, and other impacts from COVID-19. Value-add revenue for the second quarter 2020 was $2.0 billion.

"The business impact from the pandemic in the quarter was severe for both the industry and Tenneco. The response from the Tenneco team around the world is a testament to their dedication and resilience," said Brian Kesseler, Tenneco's chief executive officer. "Our production facilities safely returned to operations throughout the quarter following local and federal health guidelines. Our thoughts remain with our team members, families and communities who have been impacted by COVID-19, and we continually work to keep them healthy, both on the job and outside the workplace."

The Company reported a net loss for second quarter 2020 of $350 million, or $(4.30) per diluted share. Including a $113 million non-cash charge primarily related to a realignment project in its North America Aftermarket distribution network, the Company reported a second quarter 2020 EBIT (earnings before interest, taxes and noncontrolling interests) loss of $375 million.

On an adjusted basis, second quarter 2020 EBITDA was $8 million with an EBIT loss of $149 million. Adjusted net loss was $175 million, or ($2.15) per diluted share.

Company liquidity remained solid, with cash balances of $1.37 billion as of June 30, 2020. Based on available industry forecasts and Company estimates, the Company believes it has adequate liquidity to weather the current downturn and expected higher demand and production levels over the next several quarters.

"The Tenneco team's swift and effective actions to reduce costs and preserve liquidity enabled the Company to respond well in a very challenging environment," Kesseler continued. "Our global footprint and the diverse end markets we serve allowed us to offset a portion of the light vehicle production demand decline in the quarter. Earnings and cash performance were driven by effectively flexing our cost structure and working capital with both structural and temporary actions."

OutlookDue to the continued uncertainty of the pandemic's effect on the global markets, the Company is not providing financial guidance for the full year. Tenneco does expect third quarter 2020 revenue to improve substantially compared to the second quarter 2020, but lower than third quarter 2019 results. The Company also expects the benefit of incremental structural cost savings and continued capital management will drive sequential improvement in cash from operations through the second half of 2020.

"Our continuing focus on structural cost reductions and accelerating cash generation will build momentum through the remainder of this year and into 2021," added Kesseler. "The priority we have placed on debt reduction and targeted growth investments will create a stronger Tenneco and deliver improved shareholder value."

*Source: IHS Automotive July 2020 global light vehicle production forecast.

Attachment 1Statements of Income (Loss) - 3 monthsStatements of Income (Loss) - 6 monthsBalance SheetsStatements of Cash Flows - 3 MonthsStatements of Cash Flows - 6 Months

Attachment 2Reconciliation of GAAP to Non-GAAP Earnings Measures - 3 MonthsReconciliation of GAAP to Non-GAAP Earnings Measures - 6 MonthsReconciliation of GAAP Revenue to Non-GAAP Revenue Measures - 3 MonthsReconciliation of GAAP Revenue to Non-GAAP Revenue Measures - 6 MonthsReconciliation of Non-GAAP Measures - Debt Net of Cash/Adjusted LTM and pro forma adjusted LTM EBITDA including noncontrolling interestsReconciliation of GAAP Revenue to Non-GAAP Revenue Measures - Original Equipment, Original Equipment Service and Aftermarket Revenue - 3 and 6 MonthsReconciliation of GAAP Revenue and Earnings to Non-GAAP Revenue and Earnings Measures - 3 Months Reconciliation of GAAP Revenue and Earnings to Non-GAAP Revenue and Earnings Measures - 6 Months Reconciliation of GAAP Revenue to Non-GAAP Revenue Measures - Original Equipment Commercial Truck, Off-Highway, Industrial and other revenues - 3 and 6 Months

Conference CallThe company will host a webcast conference call on Thursday, August 6, 2020 at 9:30 a.m. ET. The purpose of the call is to discuss the company's financial results for the second quarter and full year 2020, as well as to provide other information regarding matters that may impact the company's outlook. For a "listen only" broadcast and access to the presentation materials, go to the company's website www.investors.tenneco.com. To participate by telephone, please dial: 1-833-366-1121 (domestic) or 1-412-902-6733 (international), using the passcode "Tenneco Inc." A call playback will be available for one week, starting approximately one hour after the conclusion of the call. To connect, please dial 1-877-344-7529 (domestic), 1-412-317-0088 (international), 855-669-9658 (Canada), using the replay access code 10138628.

About TennecoTenneco is one of the world's leading designers, manufacturers and marketers of automotive products for original equipment and aftermarket customers, with 2019 revenues of $17.45 billion and approximately 78,000 team members working at more than 300 sites worldwide. Our four business groups, Motorparts, Ride Performance, Clean Air and Powertrain, deliver technology solutions for diversified global markets, including light vehicle, commercial truck, off-highway, industrial, motorsport and the aftermarket.

Visit www.tenneco.com to learn more.

Investors and others should note that Tenneco routinely posts important information on its website and considers the Investor section, www.investors.tenneco.com, a channel of distribution.

About GuidanceRevenue estimates and other forecasted information in this release are based on OE manufacturers' programs that have been formally awarded to the company; programs where Tenneco is highly confident that it will be awarded business based on informal customer indications consistent with past practices; and Tenneco's status as supplier for the existing program and its relationship with the customer. This information is also based on anticipated vehicle production levels and pricing, including precious metals pricing and the impact of material cost changes. Unless otherwise indicated, our methodology does not attempt to forecast currency fluctuations, and accordingly, reflects constant currency. Certain elements of the restructuring and related expenses, legal settlements and other unusual charges we incur from time to time cannot be forecasted accurately. In this respect, we are not able to forecast corresponding GAAP measures without unreasonable efforts on account of these factors and other factors not in our control.

Safe HarborThis press release contains forward-looking statements. The words "will," "would," "could," "plan," "expect," "anticipate," "estimate," "opportunities," and similar expressions (and variations thereof), identify these forward-looking statements. These forward-looking statements are based on the current expectations of the company (including its subsidiaries). Because these statements involve risks and uncertainties, actual results may differ materially from the expectations expressed in the forward-looking statements. Important factors that could cause actual results to differ materially from the expectations reflected in the forward-looking statements include: general economic, business, market and social conditions, including the effect of the COVID-19 pandemic; disasters, local and global public health emergencies or other catastrophic events, where we or other customers do business, and any resultant disruptions; our ability (or inability) to successfully execute cost reduction, performance improvement and other plans, including our plans to respond to the COVID-19 pandemic and our previously announced accelerated performance improvement plan ("Accelerate"), and to realize the anticipated benefits from these plans; changes in capital availability or costs, including increases in our cost of borrowing (i.e., interest rate increases), the amount of our debt, our ability to access capital markets at favorable rates, and the credit ratings of our debt and our financial flexibility to respond to COVID-19 pandemic; our ability to maintain compliance with the agreements governing our indebtedness and otherwise have sufficient liquidity through the COVID-19 pandemic; our working capital requirements; our ability to source and procure needed materials, components and other products, and services in accordance with customer demand and at competitive prices; the cost and outcome of existing and any future claims, legal proceedings or investigations; changes in consumer demand for our OE products or aftermarket products, prices and our ability to have our products included on top selling vehicles, including any shifts in consumer preferences; the cyclical nature of the global vehicle industry, including the performance of the global aftermarket sector and the impact of vehicle parts' longer product lives; changes in automotive and commercial vehicle manufacturers' production rates and their actual and forecasted requirements for our products, due to difficult economic conditions and/or regulatory or legal changes affecting internal combustion engines and/or aftermarket products; our dependence on certain large customers, including the loss of any of our large OE manufacturer customers (on whom we depend for a significant portion of our revenues), or the loss of market shares by these customers if we are unable to achieve increased sales to other OE-customers or any change in customer demand due to delays in the adoption or enforcement of worldwide emissions regulations; the overall highly competitive nature of the automotive and commercial vehicle parts industries, and any resultant inability to realize the sales represented by our awarded book of business (which is based on anticipated pricing and volumes over the life of the applicable program); risks inherent in operating a multi-national company; damage to the reputation of one or more of our leading brands; industry-wide strikes, labor disruptions at our facilities or any labor or other economic disruptions at any of our significant customers or suppliers or any of our customers' other suppliers; changes in distribution channels or competitive conditions in the markets and countries where we operate; the evolution towards autonomous vehicles and car and ride sharing; customer acceptance of new products; our ability to successfully integrate, and benefit from, any acquisitions that we complete; the potential impairment in the carrying value of our long-lived assets, goodwill, and other intangible assets or the inability to fully realize our deferred tax assets; increases in the costs of raw materials or components, including our ability to successfully reduce the impact of any such cost increases through materials substitutions, cost reduction initiatives, customer recovery and other methods; the impact of the extensive, increasing, and changing laws and regulations to which we are subject, including environmental laws and regulations, which may result in our incurrence of environmental liabilities in excess of the amount reserved or increased costs or loss of revenues relating to products subject to changing regulation; and the timing and occurrence (or non-occurrence) of other transactions, events and circumstances which may be beyond our control.

In addition, statements regarding the Company's ongoing review of strategic alternatives and the potential separation of the Company into a powertrain technology company and an aftermarket and ride performance company constitute forward-looking statements. Important factors that could cause actual results to differ materially from the expectations reflected in the forward-looking statements include (in addition to the risks set forth above): the ability to identify and consummate strategic alternatives that yield additional value for shareholders; the timing, benefits and outcome of the Company's strategic review process; the structure, terms and specific risk and uncertainties associated with any potential strategic alternative; potential disruptions in our business and stock price as a result of our exploration, review and pursuit of any strategic alternatives; the possibility that the Company may not complete a separation of the aftermarket and ride performance business from the powertrain technology business (or achieve some or all of the anticipated benefits of such a separation); the ability to retain and hire key personnel and maintain relationships with customers, suppliers or other business partners; the potential diversion of management's attention resulting from a separation; the risk that the combined company and each separate company following a separation will underperform relative to our expectations; the ongoing transaction costs and risk we may incur greater costs following a separation of the business; the risk a spin-off is determined to be a taxable transaction; the risk the benefits of a separation may not be fully realized or may take longer to realize than expected; the risk a separation may not advance our business strategy; and the risk a transaction may have an adverse effect on existing arrangements with us, including those related to transition, manufacturing and supply services and tax matters.

The risks included here are not exhaustive. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this press release. Additional information regarding risk factors and uncertainties is, and will be, detailed from time to time in the company's SEC filings, including but not limited to its annual report on Form 10-K for the year ended December 31, 2019 and quarterly report on Form 10-Q for the quarter ended March 31, 2020.

Investor inquiries:Linae Golla847-482-5162lgolla@tenneco.com

Rich Kwas248-849-1340rich.kwas@tenneco.com

Media inquiries:Bill Dawson847-482-5807bdawson@tenneco.com

ATTACHMENT 1

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

Unaudited

(dollars in millions, except share and per share amounts)

Three Months Ended June 30,

2020 2019

Net sales and operating revenues:

Clean Air - Value-add revenues $ 517 $ 1,050

Clean Air - Substrate sales 623 777

Powertrain 602 1,133

Motorparts 559 835

Ride Performance 336 709

Total net sales and operating revenues 2,637 4,504

Costs and expenses:

Cost of sales (exclusive of depreciation and amortization) 2,498 3,801

Selling, general, and administrative 195 292

Depreciation and amortization 159 169

Engineering, research, and development 55 78

Restructuring charges, net and asset impairments 121 49

Total costs and expenses 3,028 4,389

Other income (expense):

Non-service pension and other postretirement benefit (costs) credits 1 (4)

Equity in earnings (losses) of nonconsolidated affiliates, net of tax 4 17

Other income (expense), net 11 13

16 26

Earnings (loss) before interest expense, income taxes, and noncontrolling (375) 141interests

Interest expense (66) (82)

Earnings (loss) before income taxes and noncontrolling interests (441) 59

Income tax (expense) benefit 101 (14)

Net income (loss) (340) 45

Less: Net income (loss) attributable to noncontrolling interests 10 19

Net income (loss) attributable to Tenneco Inc. $ (350) $ 26

Basic earnings (loss) per share:

Earnings (loss) per share $ (4.30) $ 0.32

Weighted average shares outstanding 81.4 80.9

Diluted earnings (loss) per share:

Earnings (loss) per share $ (4.30) $ 0.32

Weighted average shares outstanding 81.4 80.9

ATTACHMENT 1

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)

Unaudited

(dollars in millions, except share and per share amounts)

Six Months Ended June 30,

2020 2019

Net sales and operating revenues:

Clean Air - Value-add revenues $ 1,362 $ 2,123

Clean Air - Substrate sales 1,323 1,483

Powertrain 1,599 2,308

Motorparts 1,265 1,632

Ride Performance 924 1,442

Total net sales and operating revenues 6,473 8,988

Costs and expenses:

Cost of sales (exclusive of depreciation and amortization) 5,837 7,671

Selling, general, and administrative 444 610

Depreciation and amortization 330 338

Engineering, research, and development 132 170

Restructuring charges, net and asset impairments 605 65

Goodwill and intangible impairment charge 383 60

Total costs and expenses 7,731 8,914

Other income (expense):

Non-service pension and other postretirement benefit (costs) credits 2 (6)

Equity in earnings (losses) of nonconsolidated affiliates, net of tax 17 33

Other income (expense), net 19 16

38 43

Earnings (loss) before interest expense, income taxes, and noncontrolling (1,220) 117interests

Interest expense (141) (163)

Earnings (loss) before income taxes and noncontrolling interests (1,361) (46)

Income tax (expense) benefit 195 (14)

Net income (loss) (1,166) (60)

Less: Net income (loss) attributable to noncontrolling interests 23 31

Net income (loss) attributable to Tenneco Inc. $ (1,189) $ (91)

Basic earnings (loss) per share:

Earnings (loss) per share $ (14.64) $ (1.13)

Weighted average shares outstanding 81.3 80.9

Diluted earnings (loss) per share:

Earnings (loss) per share $ (14.64) $ (1.13)

Weighted average shares outstanding 81.3 80.9

ATTACHMENT 1

TENNECO INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

Unaudited

(dollars in millions)

June 30, 2020 December 31, 2019

Assets

Cash and cash equivalents $ 1,362 $ 564

Restricted cash 9 2

Receivables, net 2,185 (a) 2,538 (a)

Inventories 1,656 1,999

Prepayments and other current assets 632 632

Other noncurrent assets 3,612 3,864

Property, plant, and equipment, net 2,939 3,627

Total assets $ 12,395 $ 13,226

Liabilities and Shareholders' Equity

Short-term debt, including current maturities of long-term debt $ 222 $ 185

Accounts payable 1,992 2,647

Accrued compensation and employee benefits 331 325

Accrued income taxes 48 72

Accrued expenses and other current liabilities 1,043 1,070

Long-term debt 6,629 (b) 5,371 (b)

Deferred income taxes 88 106

Pension and postretirement benefits 1,112 1,145

Deferred credits and other liabilities 502 490

Redeemable noncontrolling interests 79 196

Tenneco Inc. shareholders' equity 74 1,425

Noncontrolling interests 275 194

Total liabilities, redeemable noncontrolling interests, and equity $ 12,395 $ 13,226

June 30, 2020 December 31, 2019

(a) Accounts receivable net of:

Accounts receivable outstanding and derecognized $ 873 $ 1,037

(b) Long-term debt composed of:

Revolver Borrowings $ 1,500 $ 183

LIBOR plus 1.75% Term Loan A due 2019 through 2023 1,561 1,608

LIBOR plus 3.00% Term Loan B due 2019 through 2025 1,614 1,623

$225 million of 5.375% Senior Notes due 2024 223 222

$500 million of 5.000% Senior Notes due 2026 494 494

(eu)415 million 4.875% Euro Fixed Rate Notes due 2022 477 479

(eu)300 million of Euribor plus 4.875% Euro Floating Rate Notes due 2024 340 340

(eu)350 million of 5.000% Euro Fixed Rate Notes due 2024 412 413

Other Debt, primarily foreign instruments 12 13

6,633 5,375

Less: maturities classified as current 4 4

Total long-term debt $ 6,629 $ 5,371

ATTACHMENT 1

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Unaudited

(dollars in millions)

Three Months Ended June 30,

2020 2019

Operating Activities

Net income (loss) $ (340) $ 45

Adjustments to reconcile net income (loss) to cash (used) provided by operatingactivities:

Depreciation and amortization 159 169

Deferred income taxes (76) (6)

Stock-based compensation 7 6

Restructuring charges and asset impairments, net of cash paid 86 28

Change in pension and other postretirement benefit plans (7) (15)

Equity in earnings of nonconsolidated affiliates (4) (17)

Cash dividends received from nonconsolidated affiliates 5 12

Loss (gain) on sale of assets (1) (1)

Changes in operating assets and liabilities:

Receivables 35 (89)

Inventories 365 90

Payables and accrued expenses (404) (109)

Accrued interest and accrued income taxes (46) (28)

Other assets and liabilities 42 (35)

Net cash (used) provided by operating activities (179) 50

Investing Activities

Proceeds from sale of assets 3 4

Cash payments for property, plant, and equipment (75) (169)

Proceeds from deferred purchase price of factored receivables 35 87

Other (1) (3)

Net cash (used) provided by investing activities (38) (81)

Financing Activities

Proceeds from term loans and notes 29 83

Repayments of term loans and notes (49) (126)

Debt issuance costs of long-term debt (8) -

Borrowings on revolving lines of credit 1,660 2,406

Payments on revolving lines of credit (877) (2,273)

Net increase (decrease) in bank overdrafts 61 (7)

Other (12) 2

Distributions to noncontrolling interest partners - (19)

Net cash (used) provided by financing activities 804 66

Effect of foreign exchange rate changes on cash, cash equivalents, and 14 (8)restricted cash

Increase (decrease) in cash, cash equivalents, and restricted cash 601 27

Cash, cash equivalents, and restricted cash, beginning of period 770 363

Cash, cash equivalents, and restricted cash, end of period $ 1,371 $ 390

Supplemental Cash Flow Information

Cash paid during the period for interest $ 56 $ 71

Cash paid during the period for income taxes, net of refunds $ 34 $ 57

Lease assets obtained in exchange for new operating lease liabilities $ 3 $ 33

Non-cash inventory charge due to aftermarket product line exit $ 82 $ -

Non-cash Investing Activities

Period end balance of accounts payable for property, plant, and equipment $ 86 $ 116

Deferred purchase price of receivables factored in the period $ 35 $ 52

ATTACHMENT 1

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Unaudited

(dollars in millions)

Six Months Ended June 30,

Operating Activities 2020 2019

Net income (loss) $ (1,166) $ (60)

Adjustments to reconcile net income (loss) to cash (used) provided by operatingactivities:

Goodwill and intangible impairment charges 383 60

Depreciation and amortization 330 338

Deferred income taxes (242) (14)

Stock-based compensation 9 13

Restructuring charges and asset impairments, net of cash paid 540 14

Change in pension and other postretirement benefit plans (26) (32)

Equity in earnings of nonconsolidated affiliates (17) (33)

Cash dividends received from nonconsolidated affiliates 18 27

Loss (gain) on sale of assets (1) (1)

Changes in operating assets and liabilities:

Receivables 174 (401)

Inventories 292 101

Payables and accrued expenses (540) 48

Accrued interest and accrued income taxes (17) (66)

Other assets and liabilities (68) (94)

Net cash (used) provided by operating activities (331) (100)

Investing Activities

Acquisitions, net of cash acquired - (158)

Proceeds from sale of assets 5 5

Net proceeds from sale of business - 22

Cash payments for property, plant, and equipment (212) (379)

Proceeds from deferred purchase price of factored receivables 91 147

Other 1 (1)

Net cash (used) provided by investing activities (115) (364)

Financing Activities

Proceeds from term loans and notes 96 111

Repayments of term loans and notes (133) (190)

Debt issuance costs of long-term debt (16) -

Borrowings on revolving lines of credit 4,821 4,525

Payments on revolving lines of credit (3,536) (4,254)

Issuance (repurchase) of common shares (1) (2)

Cash dividends - (20)

Net increase (decrease) in bank overdrafts 59 (8)

Other (1) (1)

Distributions to noncontrolling interest partners (2) (20)

Net cash (used) provided by financing activities 1,287 141

Effect of foreign exchange rate changes on cash, cash equivalents, and (36) 11restricted cash

Increase (decrease) in cash, cash equivalents, and restricted cash 805 (312)

Cash, cash equivalents, and restricted cash, beginning of period 566 702

Cash, cash equivalents, and restricted cash, end of period $ 1,371 $ 390

Supplemental Cash Flow Information

Cash paid during the period for interest $ 123 $ 145

Cash paid during the period for income taxes, net of refunds $ 75 $ 100

Lease assets obtained in exchange for new operating lease liabilities $ 54 $ 33

Non-cash inventory charge due to aftermarket product line exit $ 82 $ -

Non-cash Investing Activities

Period end balance of accounts payable for property, plant, and equipment $ 86 $ 116

Deferred purchase price of receivables factored in the period $ 95 $ 52

Reduction in assets from redeemable noncontrolling interest transaction with $ 53 $ -owner

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) TO NON-GAAP EARNINGS MEASURES^(2)

Unaudited

(dollars in millions, except per share amounts)

Q2 2020 Q2 2019

Net income Net income Income Net income Net income Income (loss) (loss) tax EBITDA (loss) Per (loss) tax EBITDA attributable Per Share attributable to (expense) EBIT [(3)] attributable Share attributable to (expense) EBIT [(3)] to Tenneco noncontrolling benefit to Tenneco noncontrolling benefit Inc. interests Inc. interests

Earnings (Loss) $ (350) $ (4.30) $ 10 $ 101 $ (375) $ (216) $ 26 $ 0.32 $ 19 $ (14) $ 141 $ 310Measures

Adjustments:

Restructuringand related 82 1.00 - (25) 107 105 44 0.54 2 (14) 60 57expenses ^(5)

Inventory 63 0.78 - (19) 82 82 - - - - - -write-down ^(6)

Assetimpairments ^ 22 0.27 - (7) 29 29 - - - - - -(7)

Acquisition andexpected 6 0.08 - (2) 8 8 19 0.23 - (8) 27 27separationcosts ^(8)

Cost reductioninitiatives ^ - - - - - - 1 0.02 - (1) 2 2(9)

Costs toachieve - - - - - - 5 0.06 - (2) 7 7synergies ^(10)

Purchaseaccounting - - - - - - 1 0.02 - (2) 3 3charges ^(11)

Processharmonization ^ - - - - - - - - - (1) 1 1(12)

Warranty charge - - - - - - 5 0.06 - (2) 7 7^(13)

Net tax 2 0.02 - 2 - - (4) (0.05) - (4) - -adjustments

Adjusted Netincome, EPS, $ (175) $ (2.15) $ 10 $ 50 $ (149) $ 8 $ 97 $ 1.20 $ 21 $ (48) $ 248 $ 414NCI, Tax, EBIT,and EBITDA ^(4)

Q2 2020

Global Segments

Clean Powertrain Motorparts Ride Total Corporate Total Air Performance

Net income (loss) attributable to Tenneco $ (350)Inc.

Net income (loss) attributable to 10noncontrolling interests

Net income (loss) (340)

Income tax (expense) benefit 101

Interest expense (66)

EBIT, Earnings (Loss) before interestexpense, income taxes and noncontrolling (375)interests

Depreciation and amortization 159

Total EBITDA including noncontrolling $ 17 $ (62) $ (52) $ (70) $ (167) $ (49) $ (216)interests ^(3)

Restructuring and related expenses^(5) 21 37 17 29 104 1 105

Inventory write-down^(6) - - 82 - 82 - 82

Asset impairments ^(7) - 4 24 - 28 1 29

Acquisition and expected separation costs - - - - - 8 8^(8)

Adjusted EBITDA ^(4) $ 38 $ (21) $ 71 $ (41) $ 47 $ (39) $ 8

Q2 2019

Global Segments

Clean Powertrain Motorparts Ride Total Corporate Total Air Performance

Net income (loss) attributable to Tenneco Inc. $ 26

Net income (loss) attributable to noncontrolling 19interests

Net income (loss) 45

Income tax (expense) benefit (14)

Interest expense (82)

EBIT, Earnings (Loss) before interest expense, 141income taxes and noncontrolling interests

Depreciation and amortization 169

Total EBITDA including noncontrolling interests $ 152 $ 100 $ 110 $ 26 $ 388 $ (78) $ 310^(3)

Restructuring and related expenses^(5) 15 16 3 23 57 - 57

Acquisition and expected separation costs ^(8) - - 1 - 1 26 27

Cost reduction initiatives ^(9) - - - - - 2 2

Costs to achieve synergies ^(10) - 2 4 (1) 5 2 7

Purchase accounting charges ^(11) - - 1 2 3 - 3

Process harmonization ^(12) 1 - - - 1 - 1

Warranty charge ^(13) - - 7 - 7 - 7

Adjusted EBITDA ^(4) $ 168 $ 118 $ 126 $ 50 $ 462 $ (48) $ 414

______________________________

(1) U.S. Generally Accepted Accounting Principles.

(2) Tenneco presents the above reconciliation of GAAP to non-GAAP earnings measures primarily to reflect the results in a manner that allows a better understanding of the results of operational activities separate from the financial impact of decisions made for the long-term benefit of the company and other items impacting comparability between the periods. Adjustments similar to the ones reflected above have been recorded in earlier periods, and similar types of adjustments can reasonably be expected to be recorded in future periods. Using only the non-GAAP earnings measures to analyze earnings would have material limitations because its calculation is based on the subjective determinations of management regarding the nature and classification of events and circumstances that investors may find material. Management compensates for these limitations by utilizing both GAAP and non-GAAP earnings measures reflected above to understand and analyze the results of the business. The company believes investors find the non-GAAP information helpful in understanding the ongoing performance of operations separate from items that may have a disproportionate positive or negative impact on the company's financial results in any particular period.

(3) EBITDA including noncontrolling interests represents income before interest expense, income taxes, noncontrolling interests and depreciation and amortization. EBITDA including noncontrolling interests is not a calculation based upon GAAP. The amounts included in the EBITDA including noncontrolling interests calculation, however, are derived from amounts included in the historical statements of income data. In addition, EBITDA including noncontrolling interests should not be considered as an alternative to net income attributable to Tenneco Inc. or operating income as an indicator of the company's operating performance, or as an alternative to operating cash flows as a measure of liquidity. Tenneco has presented EBITDA including noncontrolling interests because it regularly reviews EBITDA including noncontrolling interests as a measure of the company's performance. In addition, Tenneco believes its investors utilize and analyze the company's EBITDA including noncontrolling interests for similar purposes. Tenneco also believes EBITDA including noncontrolling interests assists investors in comparing a company's performance on a consistent basis without regard to depreciation and amortization, which can vary significantly depending upon many factors. However, the EBITDA including noncontrolling interests measure presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation.

(4) Adjusted results are presented in order to reflect the results in a manner that allows a better understanding of operational activities separate from the financial impact of decisions made for the long term benefit of the company and other items impacting comparability between periods. Similar adjustments have been recorded in earlier periods and similar types of adjustments can reasonably be expected to be recorded in future periods. The company believes investors find the non-GAAP information helpful in understanding the ongoing performance of operations separate from items that may have a disproportionate positive or negative impact on the company's financial results in any particular period.

(5) Q2 2020 includes $2 million and Q2 2019 includes $3 million of accelerated depreciation related to plant closures.

(6) Non-cash charge to write-down inventory to its net realizable value.

(7) Asset impairment charges.

(8) Costs related to acquisitions and costs related to expected separation.

(9) Costs related to cost reduction initiatives.

(10) Costs to achieve synergies related to the Acquisitions.

(11) This primarily relates to a non-cash charge to cost of sales for the amortization of the inventory fair value step-up recorded as part of the Acquisitions.

(12) Charge due to process harmonization.

(13) Charge related to warranty. Although Tenneco regularly incurs warranty costs, this specific charge is of an unusual nature in the period incurred.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) TO NON-GAAP EARNINGS MEASURES^(2)

Unaudited

(dollars in millions, except per share amounts)

Q2 2020 YTD Q2 2019 YTD

Net income Net income Net income Net income (loss) (loss) Income (loss) (loss) Income attributable Per Share attributable tax EBIT EBITDA attributable Per Share attributable tax EBIT EBITDA to Tenneco to (expense) [(3)] to Tenneco to (expense) [(3)] Inc. noncontrolling benefit Inc. noncontrolling benefit interests interests

Earnings (Loss) Measures $ (1,189) $ (14.64) $ 23 $ 195 $ (1,220) $ (890) $ (91) $ (1.13) $ 31 $ (14) $ 117 $ 455

Adjustments:

Restructuring and 113 1.38 - (33) 146 139 60 0.73 3 (17) 80 74related expenses ^(5)

Inventory write-down ^ 63 0.78 - (19) 82 82 - - - - - -(6)

Goodwill and intangible 366 4.52 5 (12) 383 383 60 0.74 - - 60 60impairment charge ^(7)

Asset impairments ^(8) 393 4.84 7 (100) 500 500 - - - - - -

Acquisition and expected 25 0.31 - (8) 33 33 51 0.62 - (16) 67 67separation costs ^(9)

Cost reduction - - - - - - 7 0.09 - (3) 10 10initiatives ^(10)

Costs to achieve - - - - - - 11 0.14 - (3) 14 14synergies ^(11)

Purchase accounting - - - - - - 35 0.44 - (9) 44 44charges ^(12)

Process harmonization ^ - - - - - - 7 0.09 - (3) 10 10(13)

Noncontrolling interests 11 0.14 (11) - - - - - - - - -adjustments ^(14)

Warranty charge ^(15) - - - - - - 5 0.06 - (2) 7 7

Net tax adjustments 17 0.20 - 17 - - (6) (0.07) - (6) - -

Adjusted Net income,EPS, NCI, Tax, EBIT, and $ (201) $ (2.47) $ 24 $ 40 $ (76) $ 247 $ 139 $ 1.71 $ 34 $ (73) $ 409 $ 741EBITDA ^(4)

Q2 2020 YTD

Global Segments

Clean Powertrain Motorparts Ride Total Corporate Total Air Performance

Net income (loss) attributable to Tenneco $ (1,189)Inc.

Net income (loss) attributable to 23noncontrolling interests

Net income (loss) (1,166)

Income tax (expense) benefit 195

Interest expense (141)

EBIT, Earnings (Loss) before interestexpense, income taxes and noncontrolling (1,220)interests

Depreciation and amortization 330

Total EBITDA including noncontrolling $ 116 $ (132) $ (92) $ (647) $ (755) $ (135) $ (890)interests ^(3)

Restructuring and related expenses^(5) 22 37 20 54 133 6 139

Inventory write-down^(6) - - 82 - 82 - 82

Goodwill and intangible impairment charge ^ - 160 110 113 383 - 383(7)

Asset impairments ^(8) - 4 24 455 483 17 500

Acquisition and expected separation costs ^ 4 - - - 4 29 33(9)

Adjusted EBITDA ^(4) $ 142 $ 69 $ 144 $ (25) $ 330 $ (83) $ 247

Q2 2019 YTD

Global Segments

Clean Powertrain Motorparts Ride Total Corporate Total Air Performance

Net income (loss) attributable to Tenneco Inc. $ (91)

Net income (loss) attributable to 31noncontrolling interests

Net income (loss) (60)

Income tax (expense) benefit (14)

Interest expense (163)

EBIT, Earnings (Loss) before interest expense, 117income taxes and noncontrolling interests

Depreciation and amortization 338

Total EBITDA including noncontrolling interests $ 283 $ 213 $ 155 $ (19) 632 $ (177) $ 455^(3)

Restructuring and related expenses^(5) 19 17 4 33 73 1 74

Goodwill impairment charge ^(7) - - - 60 60 - 60

Acquisition and expected separation costs ^(9) - - 1 - 1 66 67

Cost reduction initiatives ^(10) - - - - - 10 10

Costs to achieve synergies ^(11) 1 2 7 2 12 2 14

Purchase accounting charges ^(12) - 2 37 5 44 - 44

Process harmonization ^(13) 5 - 5 - 10 - 10

Warranty charge ^(15) - - 7 - 7 - 7

Adjusted EBITDA ^(4) $ 308 $ 234 $ 216 $ 81 $ 839 $ (98) $ 741

______________________________

(1) U.S. Generally Accepted Accounting Principles.

(2) Tenneco presents the above reconciliation of GAAP to non-GAAP earnings measures primarily to reflect the results in a manner that allows a better understanding of the results of operational activities separate from the financial impact of decisions made for the long-term benefit of the company and other items impacting comparability between the periods. Adjustments similar to the ones reflected above have been recorded in earlier periods, and similar types of adjustments can reasonably be expected to be recorded in future periods. Using only the non-GAAP earnings measures to analyze earnings would have material limitations because its calculation is based on the subjective determinations of management regarding the nature and classification of events and circumstances that investors may find material. Management compensates for these limitations by utilizing both GAAP and non-GAAP earnings measures reflected above to understand and analyze the results of the business. The company believes investors find the non-GAAP information helpful in understanding the ongoing performance of operations separate from items that may have a disproportionate positive or negative impact on the company's financial results in any particular period.

(3) EBITDA including noncontrolling interests represents income before interest expense, income taxes, noncontrolling interests and depreciation and amortization. EBITDA including noncontrolling interests is not a calculation based upon GAAP. The amounts included in the EBITDA including noncontrolling interests calculation, however, are derived from amounts included in the historical statements of income data. In addition, EBITDA including noncontrolling interests should not be considered as an alternative to net income attributable to Tenneco Inc. or operating income as an indicator of the company's operating performance, or as an alternative to operating cash flows as a measure of liquidity. Tenneco has presented EBITDA including noncontrolling interests because it regularly reviews EBITDA including noncontrolling interests as a measure of the company's performance. In addition, Tenneco believes its investors utilize and analyze the company's EBITDA including noncontrolling interests for similar purposes. Tenneco also believes EBITDA including noncontrolling interests assists investors in comparing a company's performance on a consistent basis without regard to depreciation and amortization, which can vary significantly depending upon many factors. However, the EBITDA including noncontrolling interests measure presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation.

(4) Adjusted results are presented in order to reflect the results in a manner that allows a better understanding of operational activities separate from the financial impact of decisions made for the long term benefit of the company and other items impacting comparability between periods. Similar adjustments have been recorded in earlier periods and similar types of adjustments can reasonably be expected to be recorded in future periods. The company believes investors find the non-GAAP information helpful in understanding the ongoing performance of operations separate from items that may have a disproportionate positive or negative impact on the company's financial results in any particular period.

(5) Q2 YTD 2020 includes $7 million and Q2 YTD 2019 includes $6 million of accelerated depreciation related to plant closures.

(6) Non-cash charge to write-down inventory to its net realizable value.

(7) Non-cash asset impairment charge related to goodwill and intangibles.

(8) Asset impairment charges.

(9) Costs related to acquisitions and costs related to expected separation.

(10) Costs related to cost reduction initiatives.

(11) Costs to achieve synergies related to the Acquisitions.

(12) This primarily relates to a non-cash charge to cost of sales for the amortization of the inventory fair value step-up recorded as part of the Acquisitions.

(13) Charge due to process harmonization.

(14) Amount relates to adjustments made to mark certain redeemable noncontrolling interests to their redemption values.

(15) Charge related to warranty. Although Tenneco regularly incurs warranty costs, this specific charge is of an unusual nature in the period incurred.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) TO NON-GAAP REVENUE MEASURES^(2)

Unaudited

(dollars in millions except percents)

Q2 2020

Currency Value-add Revenues Substrate Value-add Impact on Revenues Sales Revenues Value-add excluding Revenues Currency

Clean Air $ 1,140 $ 623 $ 517 $ (16) $ 533

Powertrain 602 - 602 (35) 637

Motorparts 559 - 559 (27) 586

Ride Performance 336 - 336 (15) 351

Total Tenneco Inc. $ 2,637 $ 623 $ 2,014 $ (93) $ 2,107

Q2 2019

Currency Value-add Revenues Substrate Value-add Impact on Revenues Sales Revenues Value-add excluding Revenues Currency

Clean Air $ 1,827 $ 777 $ 1,050 $ - $ 1,050

Powertrain 1,133 - 1,133 - 1,133

Motorparts 835 - 835 - 835

Ride Performance 709 - 709 - 709

Total Tenneco Inc. $ 4,504 $ 777 $ 3,727 $ - $ 3,727

Q2 2020 vs. Q2 2019 $ Change and % Change Increase (decrease)

Revenues % Change Value-add Revenues % Change excluding Currency

Clean Air $ (687) (38) % $ (517) (49) %

Powertrain (531) (47) % (496) (44) %

Motorparts (276) (33) % (249) (30) %

Ride Performance (373) (53) % (358) (50) %

Total Tenneco Inc. $ (1,867) (41) % $ (1,620) (43) %

______________________________

(1) U.S. Generally Accepted Accounting Principles.

(2) Tenneco presents the above reconciliation of revenues in order to reflect value-add revenues separately from the effects of doing business in currencies other than the U.S. dollar. Additionally, substrate sales include precious metals pricing, which may be volatile. Substrate sales occur when, at the direction of its OE customers, Tenneco purchases catalytic converters or components thereof from suppliers, uses them in its manufacturing processes and sells them as part of the completed system. While Tenneco original equipment customers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Tenneco uses this information to analyze the trend in revenues before these factors. Tenneco believes investors find this information useful in understanding period to period comparisons in the company's revenues.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) TO NON-GAAP REVENUE MEASURES^(2)

Unaudited

(dollars in millions except percents)

Q2 2020 YTD

Currency Value-add Revenues Substrate Value-add Impact on Revenues Sales Revenues Value-add excluding Revenues Currency

Clean Air $ 2,685 $ 1,323 $ 1,362 $ (35) $ 1,397

Powertrain 1,599 - 1,599 (61) 1,660

Motorparts 1,265 - 1,265 (46) 1,311

Ride Performance 924 - 924 (32) 956

Total Tenneco Inc. $ 6,473 $ 1,323 $ 5,150 $ (174) $ 5,324

Q2 2019 YTD

Currency Value-add Revenues Substrate Value-add Impact on Revenues Sales Revenues Value-add excluding Revenues Currency

Clean Air $ 3,606 $ 1,483 $ 2,123 $ - $ 2,123

Powertrain 2,308 - 2,308 - 2,308

Motorparts 1,632 - 1,632 - 1,632

Ride Performance 1,442 - 1,442 - 1,442

Total Tenneco Inc. $ 8,988 $ 1,483 $ 7,505 $ - $ 7,505

Q2 2020 YTD vs. Q2 2019 YTD $ Change and % Change Increase (decrease)

Revenues % Change Value-add Revenues % Change excluding Currency

Clean Air $ (921) (26) % $ (726) (34) %

Powertrain (709) (31) % (648) (28) %

Motorparts (367) (22) % (321) (20) %

Ride Performance (518) (36) % (486) (34) %

Total Tenneco Inc. $ (2,515) (28) % $ (2,181) (29) %

______________________________

(1) U.S. Generally Accepted Accounting Principles.

(2) Tenneco presents the above reconciliation of revenues in order to reflect value-add revenues separately from the effects of doing business in currencies other than the U.S. dollar. Additionally, substrate sales include precious metals pricing, which may be volatile. Substrate sales occur when, at the direction of its OE customers, Tenneco purchases catalytic converters or components thereof from suppliers, uses them in its manufacturing processes and sells them as part of the completed system. While Tenneco original equipment customers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Tenneco uses this information to analyze the trend in revenues before these factors. Tenneco believes investors find this information useful in understanding period to period comparisons in the company's revenues.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF NON-GAAP MEASURES

Debt net of total cash / Adjusted LTM and Pro Forma Adjusted LTM EBITDAincluding noncontrolling interests

Unaudited

(dollars in millions except ratios)

June 30, 2020 June 30, 2019

Total debt $ 6,851 $ 5,678

Total cash, cash equivalents and restricted cash 1,371 390(total cash)

Debt net of total cash balances ^(1) $ 5,480 $ 5,288

Adjusted LTM and Pro forma Adjusted LTM EBITDA $ 921 $ 1,514including noncontrolling interests ^(2) (3) (5)

Ratio of debt net of total cash balances and proforma ratio of debt net of total cash balances to 6.0x 3.5xadjusted LTM and proforma adjusted LTM EBITDAincluding noncontrolling interests ^(4) (5)

Q3 Q4 2019 Q1 2020 Q2 2020 Q2 2020 LTM 2019

Net income (loss) attributable to Tenneco Inc. $ 70 $ (313) $ (839) $ (350) $ (1,432)

Net income (loss) attributable to noncontrolling 8 75 13 10 106interests

Net income (loss) 78 (238) (826) (340) (1,326)

Income tax (expense) benefit 9 (14) 94 101 190

Interest expense (79) (80) (75) (66) (300)

EBIT, Earnings (Loss) before interest expense, 148 (144) (845) (375) (1,216)income taxes and noncontrolling interests

Depreciation and amortization 165 170 171 159 665

Total EBITDA including noncontrolling interests $ 313 $ 26 $ (674) $ (216) $ (551)^(2)

Adjustments:

Restructuring and related expenses 28 36 34 105 203

Inventory write-down ^(6) - - - 82 82

Goodwill and intangible impairment charge ^(7) 9 172 383 - 564

Asset impairments ^(8) - - 471 29 500

Acquisition and expected separation costs ^(9) 30 30 25 8 93

Cost reduction initiatives ^(10) 6 (1) - - 5

Costs to achieve synergies ^(11) 7 8 - - 15

Purchase accounting charges ^(12) 11 2 - - 13

Process harmonization ^(13) - 16 - - 16

Warranty charge ^(14) 1 - - - 1

Antitrust reserve change in estimate ^(15) (9) - - - (9)

Brazil tax credit ^(16) (22) - - - (22)

Out of period adjustment ^(17) 5 - - - 5

Impairment of assets held for sale 8 - - - 8

Pension charges/adjustments ^(18) - (2) - - (2)

Total Adjusted EBITDA including noncontrolling $ 387 $ 287 $ 239 $ 8 $ 921interests ^(3)

Q3 Q4 2018 Q1 2019 Q2 Q2 2019 2018* 2019 LTM

Net income (loss) attributable to Tenneco Inc. $ 57 $ (109) $ (117) $ 26 $ (143)

Net income (loss) attributable to 9 17 12 19 57noncontrolling interests

Net income (loss) 66 (92) (105) 45 (86)

Income tax (expense) benefit (22) 10 - (14) (26)

Interest expense (24) (79) (81) (82) (266)

EBIT, Earnings (Loss) before interest expense, 112 (23) (24) 141 206income taxes and noncontrolling interests

Depreciation and amortization 60 165 169 169 563

Total EBITDA including noncontrolling interests $ 172 $ 142 $ 145 $ 310 $ 769^(2)

Adjustments:

Restructuring and related expenses 12 17 17 57 103

Goodwill impairment charge ^(7) - 3 60 - 63

Acquisition and expected separation costs ^(9) 12 53 40 27 132

Cost reduction initiatives ^(10) - 8 8 2 18

Costs to achieve synergies ^(11) 4 49 7 7 67

Purchase accounting charges ^(12) - 106 41 3 150

Process harmonization ^(13) - - 9 1 10

Warranty charge ^(14) - - - 7 7

Pension charges/adjustments ^(18) - 3 - - 3

Anti-dumping duty charge ^(19) - 16 - - 16

Litigation settlement accrual 10 - - - 10

Loss on debt modification ^(20) - 10 - - 10

Total Adjusted EBITDA including noncontrolling $ 210 $ 407 $ 327 $ 414 $ 1,358interests ^(3)

Legacy Federal-Mogul Reconciliation of Non-GAAP earningsmeasures

Q3 2018

Net income (loss) attributable to Federal-Mogul $ 35

Net income (loss) attributable to 1noncontrolling interests

Net income (loss) 36

Income tax (expense) benefit (16)

Interest expense (49)

EBIT, Earnings (Loss) before interest expense, 101income taxes and noncontrolling interests

Depreciation and amortization 99

Total EBITDA including noncontrolling interests $ 200^(2)

Adjustments:

Restructuring charges and asset impairments, 15net

Gain (loss) on sale of assets (65)

Charge for extinguishment of dissenting 5shareholders shares

Other 1

Total Adjusted EBITDA including noncontrolling $ 156interests ^(3)

Q3 Q4 2018 Q1 2019 Q2 Q2 2019 2018* 2019 LTM

Adjusted EBITDA and Pro forma Adjusted EBITDA $ 366 $ 407 $ 327 $ 414 $ 1,514including noncontrolling interests ^(2) (3) (5)

______________________________

* Financial results for Q3 2018 have been revised for certain immaterial adjustments as discussed in Tenneco's Form 10-K for the year ended December 31, 2018.

(1) Tenneco presents debt net of total cash balances because management believes it is a useful measure of Tenneco's credit position and progress toward reducing leverage. The calculation is limited in that the company may not always be able to use cash to repay debt on a dollar-for-dollar basis.

(2) EBITDA including noncontrolling interests represents income before interest expense, income taxes, noncontrolling interests and depreciation and amortization. EBITDA including noncontrolling interests is not a calculation based upon GAAP. The amounts included in the EBITDA including noncontrolling interests calculation, however, are derived from amounts included in the historical statements of income data. In addition, EBITDA including noncontrolling interests should not be considered as an alternative to net income (loss) attributable to Tenneco Inc. or operating income as an indicator of the company's operating performance, or as an alternative to operating cash flows as a measure of liquidity. Tenneco has presented EBITDA including noncontrolling interests because it regularly reviews EBITDA including noncontrolling interests as a measure of the company's performance. In addition, Tenneco believes its investors utilize and analyze the company's EBITDA including noncontrolling interests for similar purposes. Tenneco also believes EBITDA including noncontrolling interests assists investors in comparing a company's performance on a consistent basis without regard to depreciation and amortization, which can vary significantly depending upon many factors. However, the EBITDA including noncontrolling interests measure presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation.

(3) Adjusted EBITDA including noncontrolling interests is presented in order to reflect the results in a manner that allows a better understanding of operational activities separate from the financial impact of decisions made for the long term benefit of the company and other items impacting comparability between the periods. Similar adjustments to EBITDA including noncontrolling interests have been recorded in earlier periods, and similar types of adjustments can reasonably be expected to be recorded in future periods. The company believes investors find the non-GAAP information helpful in understanding the ongoing performance of operations separate from items that may have a disproportionate positive or negative impact on the company's financial results in any particular period.

(4) Tenneco presents the above reconciliation of the ratio of debt net of total cash to LTM Adjusted EBITDA including noncontrolling interests to show trends that investors may find useful in understanding the company's ability to service its debt. For purposes of this calculation, Adjusted LTM and Pro Forma adjusted LTM EBITDA including noncontrolling interests is used as an indicator of the company's performance and debt net of total cash is presented as an indicator of the company's credit position and progress toward reducing the company's financial leverage. This reconciliation is provided as supplemental information and not intended to replace the company's existing covenant ratios or any other financial measures that investors may find useful in describing the company's financial position. See notes (1), (2) and (3) for a description of the limitations of using debt net of total cash, EBITDA including noncontrolling interests and Adjusted EBITDA including noncontrolling interests.

(5) Tenneco is providing Pro Forma Adjusted LTM EBITDA and the ratio of debt net of cash balances to Pro Forma Adjusted LTM EBITDA to show the company's Adjusted LTM EBITDA as if Federal-Mogul had been consolidated with Tenneco for the entirety of 2018 (and the resultant impact on the net debt ratio). Tenneco believes this supplemental information is useful to investors who are trying to understand the results of the entire enterprise, including Federal-Mogul, for 2018 and 2019 and the ability of the company to service its debt.

(6) Non-cash charge to write-down inventory to its net realizable value.

(7) Non-cash asset impairment charge related to goodwill and intangibles.

(8) Asset impairment charges.

(9) Costs related to acquisitions and costs related to expected separation.

(10) Costs related to cost reduction initiatives.

(11) Costs to achieve synergies related to the Acquisitions.

(12) This primarily relates to a non-cash charge to cost of sales for the amortization of the inventory fair value step-up recorded as part of the Acquisitions.

(13) Charge due to process harmonization.

(14) Charge related to warranty. Although Tenneco regularly incurs warranty costs, this specific charge is of an unusual nature in the period incurred.

(15) Reduction in estimated antitrust accrual.

(16) Recovery of value-added tax in a foreign jurisdiction.

(17) Inventory losses attributable to prior periods.

(18) Charges related to pension derisking and other adjustments.

(19) Charge due to retroactive application of anti-dumping duty on a supplier's products.

(20) Loss on debt modification.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) TO NON-GAAP REVENUE MEASURES^(2)

Unaudited

(dollars in millions)

Q2 2020

Revenues Substrate Value-add Revenues Currency Excluding Sales Revenues Currency Excluding Excluding Currency Currency

Original equipment light vehicle revenues $ 1,417 $ (52) $ 1,469 $ 509 $ 960

Original equipment commercial truck, off-highway, 421 (27) 448 111 337industrial and other revenues

Aftermarket & original equipment service revenues 799 (29) 828 18 810

Net sales and operating revenues $ 2,637 $ (108) $ 2,745 $ 638 $ 2,107

Q2 2019

Revenues Substrate Value-add Revenues Currency Excluding Sales Revenues Currency Excluding Excluding Currency Currency

Original equipment light vehicle revenues $ 2,680 $ - $ 2,680 $ 654 $ 2,026

Original equipment commercial truck, off-highway, 635 - 635 103 532industrial and other revenues

Aftermarket & original equipment service revenues 1,189 - 1,189 20 1,169

Net sales and operating revenues $ 4,504 $ - $ 4,504 $ 777 $ 3,727

Q2 2020 YTD

Revenues Substrate Value-add Revenues Currency Excluding Sales Revenues Currency Excluding Excluding Currency Currency

Original equipment light vehicle revenues $ 3,676 $ (99) $ 3,775 $ 1,094 $ 2,681

Original equipment commercial truck, off-highway, 957 (53) 1,010 223 787industrial and other revenues

Aftermarket & original equipment service revenues 1,840 (53) 1,893 37 1,856

Net sales and operating revenues $ 6,473 $ (205) $ 6,678 $ 1,354 $ 5,324

Q2 2019 YTD

Revenues Substrate Value-add Revenues Currency Excluding Sales Revenues Currency Excluding Excluding Currency Currency

Original equipment light vehicle revenues $ 5,326 $ - $ 5,326 $ 1,233 $ 4,093

Original equipment commercial truck, off-highway, 1,203 - 1,203 209 994industrial and other revenues

Aftermarket & original equipment service revenues 2,459 - 2,459 41 2,418

Net sales and operating revenues $ 8,988 $ - $ 8,988 $ 1,483 $ 7,505

______________________________

(1) U.S. Generally Accepted Accounting Principles.

(2) Tenneco presents the above reconciliation of revenues in order to reflect value-add revenues separately from the effects of doing business in currencies other than the U.S. dollar. Additionally, substrate sales include precious metals pricing, which may be volatile. Substrate sales occur when, at the direction of its OE customers, Tenneco purchases catalytic converters or components thereof from suppliers, uses them in its manufacturing processes and sells them as part of the completed system. While Tenneco original equipment customers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Tenneco uses this information to analyze the trend in revenues before these factors. Tenneco believes investors find this information useful in understanding period to period comparisons in the company's revenues.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) REVENUE AND EARNINGS TO NON-GAAP REVENUE ANDEARNINGS MEASURES^(2)

UNAUDITED

(dollars in millions except percents)

Q2 2020

Global Segments

Clean Air Powertrain Motorparts Ride Total Corporate Total Performance

Net sales and operating $ 1,140 $ 602 $ 559 $ 336 $ 2,637 $ - $ 2,637revenues

Less: Substrate sales 623 - - - 623 - 623

Value-add revenues $ 517 $ 602 $ 559 $ 336 $ 2,014 $ - $ 2,014

EBITDA $ 17 $ (62) $ (52) $ (70) $ (167) $ (49) $ (216)

EBITDA as a % of 1.5 % (10.3) % (9.3) % (20.8) % (6.3) % (8.2) %revenue

EBITDA as a % of 3.3 % ' (10.3) % (9.3) % (20.8) % (8.3) % (10.7) %value-add revenue

Adjusted EBITDA $ 38 $ (21) $ 71 $ (41) $ 47 $ (39) $ 8

Adjusted EBITDA as a % 3.3 % (3.5) % 12.7 % (12.2) % 1.8 % 0.3 %of revenue

Adjusted EBITDA as a % 7.4 % (3.5) % 12.7 % (12.2) % 2.3 % 0.4 %of value-add revenue

Q2 2019

Global Segments

Clean Air Powertrain Motorparts Ride Total Corporate Total Performance

Net sales and operating $ 1,827 $ 1,133 $ 835 $ 709 $ 4,504 $ - $ 4,504revenues

Less: Substrate sales 777 - - - 777 - 777

Value-add revenues $ 1,050 $ 1,133 $ 835 $ 709 $ 3,727 $ - $ 3,727

EBITDA $ 152 $ 100 $ 110 $ 26 $ 388 $ (78) $ 310

EBITDA as a % of 8.3 % 8.8 % 13.2 % 3.7 % 8.6 % 6.9 %revenue

EBITDA as a % of 14.5 % ' 8.8 % 13.2 % 3.7 % 10.4 % 8.3 %value-add revenue

Adjusted EBITDA $ 168 $ 118 $ 126 $ 50 $ 462 $ (48) $ 414

Adjusted EBITDA as a % 9.2 % 10.4 % 15.1 % 7.1 % 10.3 % 9.2 %of revenue

Adjusted EBITDA as a % 16.0 % 10.4 % 15.1 % 7.1 % 12.4 % 11.1 %of value-add revenue

______________________________

(1) U.S. Generally Accepted Accounting Principles.

(2) Tenneco presents the above reconciliation of revenues in order to reflect EBITDA and adjusted EBITDA as a percent of both total revenues and value-add revenues. Substrate sales include precious metals pricing, which may be volatile. Substrate sales occur when, at the direction of its OE customers, Tenneco purchases catalytic converters or components thereof from suppliers, uses them in its manufacturing processes and sells them as part of the completed system. While Tenneco original equipment customers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Further, presenting EBITDA and adjusted EBITDA as a percent of value-add revenue assists investors in evaluating the company's operational performance without the impact of such substrate sales. See prior pages for a discussion of EBITDA and adjusted EBITDA.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) REVENUE AND EARNINGS TO NON-GAAP REVENUE ANDEARNINGS MEASURES^(2)

UNAUDITED

(dollars in millions except percents)

Q2 2020 YTD

Global Segments

Clean Air Powertrain Motorparts Ride Total Corporate Total Performance

Net sales and operating $ 2,685 $ 1,599 $ 1,265 $ 924 $ 6,473 $ - $ 6,473revenues

Less: Substrate sales 1,323 - - - 1,323 - 1,323

Value-add revenues $ 1,362 $ 1,599 $ 1,265 $ 924 $ 5,150 $ - $ 5,150

EBITDA $ 116 $ (132) $ (92) $ (647) $ (755) $ (135) $ (890)

EBITDA as a % of revenue 4.3 % (8.3) % (7.3) % (70.0) % (11.7) % (13.7) %

EBITDA as a % of 8.5 % ' (8.3) % (7.3) % (70.0) % (14.7) % (17.3) %value-add revenue

Adjusted EBITDA $ 142 $ 69 $ 144 $ (25) 330 $ (83) $ 247

Adjusted EBITDA as a % 5.3 % 4.3 % 11.4 % (2.7) % 5.1 % 3.8 %of revenue

Adjusted EBITDA as a % 10.4 % 4.3 % 11.4 % (2.7) % 6.4 % 4.8 %of value-add revenue

Q2 2019 YTD

Global Segments

Clean Air Powertrain Motorparts Ride Total Corporate Total Performance

Net sales and operating $ 3,606 $ 2,308 $ 1,632 $ 1,442 $ 8,988 $ - $ 8,988revenues

Less: Substrate sales 1,483 - - - 1,483 - 1,483

Value-add revenues $ 2,123 $ 2,308 $ 1,632 $ 1,442 $ 7,505 $ - $ 7,505

EBITDA $ 283 $ 213 $ 155 $ (19) $ 632 $ (177) $ 455

EBITDA as a % of revenue 7.8 % 9.2 % 9.5 % (1.3) % 7.0 % 5.1 %

EBITDA as a % of 13.3 % ' 9.2 % 9.5 % (1.3) % 8.4 % 6.1 %value-add revenue

Adjusted EBITDA $ 308 $ 234 $ 216 $ 81 $ 839 $ (98) $ 741

Adjusted EBITDA as a % 8.5 % 10.1 % 13.2 % 5.6 % 9.3 % 8.2 %of revenue

Adjusted EBITDA as a % 14.5 % 10.1 % 13.2 % 5.6 % 11.2 % 9.9 %of value-add revenue

______________________________

(1) U.S. Generally Accepted Accounting Principles.

(2) Tenneco presents the above reconciliation of revenues in order to reflect EBITDA and adjusted EBITDA as a percent of both total revenues and value-add revenues. Substrate sales include precious metals pricing, which may be volatile. Substrate sales occur when, at the direction of its OE customers, Tenneco purchases catalytic converters or components thereof from suppliers, uses them in its manufacturing processes and sells them as part of the completed system. While Tenneco original equipment customers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Further, presenting EBITDA and adjusted EBITDA as a percent of value-add revenue assists investors in evaluating the company's operational performance without the impact of such substrate sales. See prior pages for a discussion of EBITDA and adjusted EBITDA.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) REVENUE TO NON-GAAP REVENUE MEASURES^(2)

Original equipment commercial truck, off-highway, industrial and other revenues

Unaudited

(dollars in millions)

Q2 2020

Revenues Substrate Sales Value-add Revenues

Clean Air $ 241 $ 107 $ 134

Powertrain 137 - 137

Ride Performance 43 - 43

Total Tenneco Inc. $ 421 $ 107 $ 314

Q2 2019

Revenues Substrate Sales Value-add Revenues

Clean Air $ 287 $ 103 $ 184

Powertrain 261 - 261

Ride Performance 87 - 87

Total Tenneco Inc. $ 635 $ 103 $ 532

Q2 2020 YTD

Revenues Substrate Sales Value-add Revenues

Clean Air $ 505 $ 216 $ 289

Powertrain 338 - 338

Ride Performance 114 - 114

Total Tenneco Inc. $ 957 $ 216 $ 741

Q2 2019 YTD

Revenues Substrate Sales Value-add Revenues

Clean Air $ 589 $ 209 $ 380

Powertrain 429 - 429

Ride Performance 185 - 185

Total Tenneco Inc. $ 1,203 $ 209 $ 994

______________________________

(1) U.S. Generally Accepted Accounting Principles.

(2) Tenneco presents the above reconciliation of revenues in order to reflect value-add revenues separately from substrate sales which include precious metals pricing, which may be volatile. Substrate sales occur when, at the direction of its OE customers, Tenneco purchases catalytic converters or components thereof from suppliers, uses them in its manufacturing processes and sells them as part of the completed system. While Tenneco original equipment customers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Tenneco uses this information to analyze the trend in revenues before these factors. Tenneco believes investors find this information useful in understanding period to period comparisons in the company's revenues.

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SOURCE Tenneco Inc.