PR Newswire | May 6, 2021 07:01AM EDT

05/06 06:00 CDT

Tenneco Delivers Strong First Quarter 2021 ResultsPosts robust revenue growth and margin expansion; cash flow discipline continuesRaising 2021 full-year outlook; initiating outlook for second quarter LAKE FOREST, Ill., May 6, 2021

LAKE FOREST, Ill., May 6, 2021 /PRNewswire/ -- Tenneco (NYSE: TEN) today announced results for the first quarter ended March 31, 2021, including the following:

* First quarter 2021 total revenue climbed 23% year-over-year to $4.7 billion. Value-add revenue for the first quarter 2021 increased to $3.6 billion, 13% higher versus the first quarter of last year, excluding positive currency impact of $104 million. * The Company reported first quarter 2021 net income of $65 million, or $0.79 per diluted share, versus a net loss of $839 million or $(10.34) per diluted share last year. Adjusted net income for the first quarter 2021 was $90 million, or $1.09 per diluted share. * First quarter 2021 EBIT* was $204 million, compared with a loss of $845 million in first quarter 2020. EBIT as a percent of revenue increased to 4.3% versus -22.0% in the prior year. * First quarter 2021 adjusted EBITDA** jumped 62% to $388 million, compared to $239 million in the first quarter of the prior year. Adjusted EBITDA as a percent of value-add revenue was 10.7%, a 310 basis point increase year-over-year. * Seasonally better first quarter 2021 cash flow and higher earnings resulted in a 0.4x improvement in net leverage ratio compared to December 31, 2020. * Quarter-end liquidity of $2.1 billion, including no balance drawn on the $1.5 billion revolving credit facility. * During the quarter, the Company completed refinancing to extend debt maturities of $800 million from 2024 to 2029, enhancing the Company's maturity profile and increasing financial flexibility.

Tenneco posts robust Q1 revenue growth, margin expansion, and raises 2021 full year guidance. "The Tenneco team continues to build on the positive momentum from the second half of last year and delivered strong Q1 results. Our disciplined performance focus, including our Accelerate+ program, resulted in margin expansion in all operating segments and better free cash flow performance," said Brian Kesseler, Tenneco CEO. "We're proud of the dedication of our team and their continuing progress on performance improvement."

OutlookTenneco is raising its full-year 2021 financial outlook***, and providing an outlook for the second quarter 2021:

Full Year 2021 - Revised Second Quarter 2021

Revenue $17.6-18.1B Revenue $4.35-4.55B

Value-Add Revenue$13.5-14B Value-Add Revenue $3.3-3.5B

Adjusted EBITDA**$1.35-1.45B Adjusted EBITDA** $325-355M

Net Debt ^(1) Less than $4.2BNet Leverage Target~3.0x

(1) Total debt net of total cash balances.

* EBIT: Earnings before interest expense, income taxes and noncontrollinginterests.

** Adjusted EBITDA: Adjusted earnings before interest expense, income taxes,noncontrolling interests, and depreciation and amortization.

*** At the midpoint, the Company estimates 2021 value-add adjusted EBITDAmargin will increase 150 basis points year-over-year to 10.2%, a 20 basis pointimprovement from prior guidance.

"Based on our strong first quarter performance we are raising our full year 2021 guidance with improved revenue, margin and cash flow," Kesseler added. "We remain laser-focused on creating shareholder value in the near-term through debt reduction, and long-term by driving sustained growth from prioritized investments in the Motorparts, Performance Solutions and CTOHI business lines."

Earnings Conference Call DetailsThe Company will report its first quarter 2021 financial results before the market opens on Thursday, May 6, 2021 and host a webcast conference call the same day at 9:30 a.m. ET. The purpose of the call is to discuss the Company's financial results for the first quarter 2021, as well as to provide other information regarding the company's outlook.

A live "listen only" webcast and presentation materials will be available on the investor section of the company's website at https://investors.tenneco.com. An archive of the webcast will be available approximately one hour after conclusion of the call for one year.

Telephone participants are encouraged to pre-register for the conference call using the following link:

https://dpregister.com/sreg/10154604/e68fe5b068

Callers who pre-register will be given a conference passcode and unique PIN to gain immediate access to the call and bypass the live operator. Participants may pre-register at any time, including up to and after the call start time.

Those without internet access or unable to pre-register may dial in, using the passcode "Tenneco Inc."PARTICIPANT DIAL IN (TOLL FREE): 1-833-366-1121PARTICIPANT INTERNATIONAL DIAL IN: 1-412-902-6733

Annual MeetingThe Tenneco Board of Directors has scheduled the company's annual meeting of shareholders for Friday, May 14, 2021 at 10:00 a.m. CT. The record date for shareholders eligible to vote at the meeting is March 24, 2021. This year's annual meeting will be held entirely online to allow for greater participation in light of the public health impact of the COVID-19 pandemic.

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

Attachment 2Reconciliation of GAAP to Non-GAAP Earnings Measures - 3 MonthsReconciliation of GAAP Revenue and Earnings to Non-GAAP Revenue and Earnings Measures - 3 Months Reconciliation of GAAP Revenue to Non-GAAP Revenue Measures - 3 MonthsReconciliation of Non-GAAP Measures - Debt Net of Total Cash/Adjusted LTM EBITDA including noncontrolling interestsReconciliation of GAAP to Non-GAAP Revenue Measures - Original Equipment, Original Equipment Service and Aftermarket Revenue - 3 MonthsReconciliation of GAAP to Non-GAAP Revenue and Earnings Measures - Q2, Q3, Q4 and FY 2020 Recast

About TennecoTenneco is one of the world's leading designers, manufacturers and marketers of automotive products for original equipment and aftermarket customers, with full year 2020 revenues of $15.4 billion and approximately 73,000 team members working at more than 270 sites worldwide. Through our four business groups, Motorparts, Performance Solutions?, Clean Air and Powertrain, Tenneco is driving advancements in global mobility by delivering 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.

? Please see attachment 1 for information on the name change of the Ride Performance segment to "Performance Solutions."

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, substrate pricing, 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," "expect," "anticipate," 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 effects of the COVID-19 pandemic; disasters, local and global public health emergencies or other catastrophic events, where we or our customers do business, and any resultant disruptions; our ability (or inability) to successfully execute cost reduction, performance improvement and other plans, including our plans in response 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 continued evolution of the automotive industry towards car and ride sharing and autonomous vehicles; to the announced plans, in an effort to reduce greenhouse gas emissions, of governments and vehicle manufacturers to limit production of diesel and gasoline powered vehicles in various national and local jurisdictions globally;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 substantial 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; 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 on the timeline contemplated or at all); 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 or other strategic alternative; the risk the combined company and each separate company following a separation will underperform relative to our expectations; the ongoing transaction costs and risk that we may incur greater costs following a separation of the business or other strategic alternative; and the risk a separation is determined to be a taxable transaction.

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 these 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, 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

(millions, except per share amounts)



Three Months Ended March 31,

2021 2020*

Net sales and operating revenues:

Motorparts $719 $706

Performance Solutions 787 669

Clean Air - Value-add revenues 1,036 845

Clean Air - Substrate sales 1,088 700

Powertrain 1,101 916

Total net sales and operating revenues 4,731 3,836

Costs and expenses:

Cost of sales (exclusive of depreciation and 4,061 3,339 amortization)

Selling, general, and administrative 255 249

Depreciation and amortization 155 171

Engineering, research, and development 72 77

Restructuring charges, net and asset impairments 25 484

Goodwill and intangible impairment charges - 383

Total costs and expenses 4,568 4,703

Other income (expense):

Non-service pension and other postretirement benefit 3 1 (costs) credits

Equity in earnings (losses) of nonconsolidated affiliates,22 13 net of tax

Gain (loss) on extinguishment of debt 8 -

Other income (expense), net 8 8

41 22

Earnings (loss) before interest expense, income taxes, and204 (845) noncontrolling interests

Interest expense (70) (75)

Earnings (loss) before income taxes and noncontrolling 134 (920) interests

Income tax (expense) benefit (47) 94

Net income (loss) 87 (826)

Less: Net income (loss) attributable to noncontrolling 22 13 interests

Net income (loss) attributable to Tenneco Inc. $65 $(839)



Basic earnings (loss) per share:

Earnings (loss) per share $0.80$(10.34)

Weighted average shares outstanding 82.0 81.2

Diluted earnings (loss) per share:

Earnings (loss) per share $0.79$(10.34)

Weighted average shares outstanding 82.5 81.2

_______________________________________

* Beginning in the first quarter of 2021, the Company made a change to itsoperating segments. This change consisted of moving a reporting unit within thePowertrain segment to the Ride Performance segment. In addition, with thischange to its segments, Ride Performance was renamed Performance Solutions. Assuch, prior period operating segment results have been conformed to reflect theCompany's current operating segments.

ATTACHMENT 1

TENNECO INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

Unaudited

(dollars in millions)



March 31, 2021 December 31, 2020

Assets

Cash and cash equivalents $ 626 $ 798

Restricted cash 5 5

Receivables, net 2,822 (a)2,528 (a)

Inventories 1,830 1,743

Prepayments and other current assets589 619

Other noncurrent assets 3,010 3,102

Property, plant, and equipment, net 2,955 3,057

Total assets $ 11,837 $ 11,852

Liabilities and Shareholders' Equity

Short-term debt, including current $ 124 $ 162 maturities of long-term debt

Accounts payable 3,090 2,917

Accrued compensation and employee 431 365 benefits

Accrued income taxes 65 54

Accrued expenses and other current 1,053 1,188 liabilities

Long-term debt 5,111 (b)5,171 (b)

Deferred income taxes 94 89

Pension and postretirement benefits 1,062 1,101

Deferred credits and other 511 546 liabilities

Redeemable noncontrolling interests 87 78

Total Tenneco Inc. shareholders' (96) (119) equity (deficit)

Noncontrolling interests 305 300

Total liabilities, redeemable $ 11,837 $ 11,852 noncontrolling interests, and equity





March 31, 2021 December 31, 2020

(a) Accounts receivable net of:

Accounts receivable outstanding and $ 976 $ 956 derecognized



(b) Long-term debt composed of:

Revolver Borrowings $ - $ -

LIBOR plus 2.25% Term Loan A due 1,490 1,520 2019 through 2023^(1)

LIBOR plus 3.00% Term Loan B due 1,610 1,612 2019 through 2025

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

$500 million of 5.000% Senior Notes 495 494 due 2026

(eu)300 million of Euribor plus 4.875% Euro Floating Rate Notes due - 370 2024^(2)

(eu)350 million of 5.000% Euro Fixed- 445 Rate Notes due 2024^(2)

$500 million of 7.875% Senior 490 489 Secured Notes due 2029

$800 million of 5.125% Senior 786 - Secured Notes due 2029^(3)

Other Debt, primarily foreign 23 23 instruments

5,117 5,176

Less: maturities classified as 6 5 current

Total long-term debt $ 5,111 $ 5,171

____________________________

(1) The interest rate on Term Loan A at December 31, 2020 was LIBOR plus 2.50%.

(2) The Company satisfied and discharged all of its 4.875% Euro Floating Rate Notes due 2024 and 5.000% Euro Fixed Rate Notes due 2024 on March 17, 2021.

(3) On March 17, 2021, the Company issued $800 million aggregate principal amount of 5.125% senior secured notes due April 15, 2029.

ATTACHMENT 1

TENNECO INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Unaudited

(dollars in millions)



Three Months Ended March 31,

2021 2020

Operating Activities

Net income (loss) $ 87 $ (826)

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

Goodwill and intangible impairment charges - 383

Depreciation and amortization 155 171

Deferred income taxes (4) (166)

Stock-based compensation 5 2

Restructuring charges and asset impairments, net of - 454 cash paid

Change in pension and other postretirement benefit (1) (19) plans

Equity in earnings of nonconsolidated affiliates (22) (13)

Cash dividends received from nonconsolidated 57 13 affiliates

Loss (gain) on sale of assets and other (9) -

Changes in operating assets and liabilities:

Receivables (452) 139

Inventories (120) (73)

Payables and accrued expenses 240 (136)

Accrued interest and accrued income taxes 8 29

Other assets and liabilities 6 (110)

Net cash (used) provided by operating activities (50) (152)

Investing Activities

Proceeds from sale of assets 7 2

Net proceeds from sale of business 1 -

Cash payments for property, plant, and equipment (95) (137)

Proceeds from deferred purchase price of factored 115 56 receivables

Other - 2

Net cash (used) provided by investing activities 28 (77)

Financing Activities

Proceeds from term loans and notes 813 67

Repayments of term loans and notes (862) (84)

Debt issuance costs of long-term debt (11) (8)

Borrowings on revolving lines of credit 1,382 3,161

Payments on revolving lines of credit (1,394) (2,659)

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

Net increase (decrease) in bank overdrafts - (2)

Distributions to noncontrolling interest partners (7) (2)

Other (49) 11

Net cash (used) provided by financing activities (130) 483

Effect of foreign exchange rate changes on cash, (20) (50) cash equivalents, and restricted cash

Increase (decrease) in cash, cash equivalents, and (172) 204 restricted cash

Cash, cash equivalents, and restricted cash, 803 566 beginning of period

Cash, cash equivalents, and restricted cash, end of $ 631 $ 770 period

Supplemental Cash Flow Information

Cash paid during the period for interest $ 65 $ 67

Cash paid during the period for income taxes, net of$ 46 $ 41 refunds

Lease assets obtained in exchange for new operating $ 15 $ 51 lease liabilities

Non-cash Investing Activities

Period end balance of accounts payable for property,$ 91 $ 96 plant, and equipment

Deferred purchase price of receivables factored in $ 135 $ 60 the period

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

ATTACHMENT 2

TENNECO INC.

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

Unaudited

(dollars in millions, except per share amounts)



Q1 2021 Q1 2020

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

Earnings (Loss) Measures $ 65 $0.79$ 22 $(47) $204$359$ (839) $(10.34)$ 13 $94 $(845)$(674)

Adjustments:

Restructuring and related expenses ^(5) 28 0.33 - (3) 31 28 31 0.38 - (8) 39 34

Loss on sale of business - 0.01 - (1) 1 1 - - - - - -

Other costs (including strategic and 8 0.10 - - 8 8 19 0.23 - (6) 25 25 transaction related)^ (6)

Gain on debt extinguishment (8) (0.10)- - (8) (8) - - - - - -

Goodwill and intangibles impairment charge- - - - - - 366 4.52 5 (12) 383 383 ^ (7)

Asset impairments^ (8) - - - - - - 371 4.57 7 (93) 471 471

Noncontrolling interests adjustments ^(9) - - - - - - 11 0.14 (11) - - -

Net tax adjustments (3) (0.04)- (3) - - 15 0.19 - 15 - -

Adjusted Net income, EPS, NCI, Tax, EBIT, $ 90 $1.09$ 22 $(54) $236$388$ (26) $(0.31) $ 14 $(10) $73 $239 and EBITDA ^(4)





Q1 2021

Global Segments

Performance Motorparts Clean AirPowertrainTotal CorporateTotal Solutions

Net income (loss) attributable to $65 Tenneco Inc.

Net income (loss) attributable to 22 noncontrolling interests

Net income (loss) 87

Income tax (47) (expense) benefit

Interest expense (70)

EBIT, Earnings (Loss) before interest expense, 204 income taxes and noncontrolling interests

Depreciation and 155 amortization

Total EBITDA including $102 $43 $149 $ 115 $409 $(50) $359 noncontrolling interests ^(3)

Restructuring and related expenses^ 2 4 9 11 26 2 28 (5)

Loss on sale of 1 - - - 1 - 1 business

Other costs (including strategic and - - (1) - (1) 9 8 transaction related) ^(6)

Gain on debt - - - - - (8) (8) extinguishment

Adjusted EBITDA ^ $105 $47 $157 $ 126 $435 $(47) $388 (4)



Q1 2020*

Global Segments

Performance Motorparts Clean AirPowertrainTotal CorporateTotal Solutions

Net income (loss) attributable to $(839)Tenneco Inc.

Net income (loss) attributable to 13 noncontrolling interests

Net income (loss) (826)

Income tax 94 (expense) benefit

Interest expense (75)

EBIT, Earnings (Loss) before interest expense, (845) income taxes and noncontrolling interests

Depreciation and 171 amortization

Total EBITDA including $(40) $(674) $99 $ 27 $(588)$(86) $(674)noncontrolling interests ^(3)

Restructuring and related expenses^ 3 25 1 - 29 5 34 (5)

Goodwill and intangible 110 232 - 41 383 - 383 impairment charges ^(7)

Asset impairments^- 455 - - 455 16 471 (8)

Other costs (including strategic and - - 4 - 4 21 25 transaction related) ^(6)

Adjusted EBITDA ^ $73 $38 $104 $ 68 $283 $(44) $239 (4)

___________________________________

* Beginning in the first quarter of 2021, the Company made a change to itsoperating segments. This change consisted of moving a reporting unit within thePowertrain segment to the Ride Performance segment. In addition, with thischange to its segments, Ride Performance was renamed Performance Solutions. Assuch, prior period operating segment results have been conformed to reflect theCompany's current operating segments.

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

(2) Tenneco presents the above reconciliation of GAAP to non-GAAP earningsmeasures primarily to reflect the results in a manner that allows a betterunderstanding of the results of operational activities separate from thefinancial impact of decisions made for the long-term benefit of the company andother items impacting comparability between the periods. Adjustments similar tothe ones reflected above have been recorded in earlier periods, and similartypes of adjustments can reasonably be expected to be recorded in futureperiods. Using only the non-GAAP earnings measures to analyze earnings wouldhave material limitations because its calculation is based on the subjectivedeterminations of management regarding the nature and classification of eventsand circumstances that investors may find material. Management compensates forthese limitations by utilizing both GAAP and non-GAAP earnings measuresreflected above to understand and analyze the results of the business. Thecompany believes investors find the non-GAAP information helpful inunderstanding the ongoing performance of operations separate from items thatmay have a disproportionate positive or negative impact on the company'sfinancial results in any particular period.

(3) EBITDA including noncontrolling interests represents income before interestexpense, income taxes, noncontrolling interests and depreciation andamortization. EBITDA including noncontrolling interests is not a calculationbased upon GAAP. The amounts included in the EBITDA including noncontrollinginterests calculation, however, are derived from amounts included in thehistorical statements of income data. In addition, EBITDA includingnoncontrolling interests should not be considered as an alternative to netincome attributable to Tenneco Inc. or operating income as an indicator of thecompany's operating performance, or as an alternative to operating cash flowsas a measure of liquidity. Tenneco has presented EBITDA includingnoncontrolling interests because it regularly reviews EBITDA includingnoncontrolling interests as a measure of the company's performance. Inaddition, Tenneco believes its investors utilize and analyze the company'sEBITDA including noncontrolling interests for similar purposes. Tenneco alsobelieves EBITDA including noncontrolling interests assists investors incomparing a company's performance on a consistent basis without regard todepreciation and amortization, which can vary significantly depending upon manyfactors. However, the EBITDA including noncontrolling interests measurepresented may not always be comparable to similarly titled measures reported byother companies due to differences in the components of the calculation.

(4) Adjusted results are presented in order to reflect the results in a mannerthat allows a better understanding of operational activities separate from thefinancial impact of decisions made for the long term benefit of the company andother items impacting comparability between periods. Similar adjustments havebeen recorded in earlier periods and similar types of adjustments canreasonably be expected to be recorded in future periods. The company believesinvestors find the non-GAAP information helpful in understanding the ongoingperformance of operations separate from items that may have a disproportionatepositive or negative impact on the company's financial results in anyparticular period.

(5) Q1 2021 and Q1 2020 includes $3 million and $5 million of accelerateddepreciation related to plant closures, respectively.

(6) Amounts in Q1 2020 included costs related to the acquisitions and expectedseparation.

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

(8) Asset impairment charges.

(9) Amount relates to adjustments made to mark certain redeemablenoncontrolling interests to their redemption values.

ATTACHMENT 2

TENNECO INC.

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

UNAUDITED

(dollars in millions except percents)



Q1 2021

Global Segments

Performance Motorparts Clean AirPowertrainTotal CorporateTotal Solutions

Net sales and operating $ 719 $787 $ 2,124$1,101 $4,731$- $4,731revenues

Less: Substrate - - 1,088 - 1,088 - 1,088 sales

Value-add $ 719 $787 $ 1,036$1,101 $3,643$- $3,643revenues



EBITDA $ 102 $43 $ 149 $115 $409 $(50) $359

EBITDA as a % of14.2% 5.5% 7.0% 10.4% 8.6% 7.6% revenue

EBITDA as a % of14.2% 5.5% 14.4% 10.4% 11.2% 9.9% value-add revenue



Adjusted EBITDA $ 105 $47 $ 157 $126 $435 $(47) $388

Adjusted EBITDA 14.6% 6.0% 7.4% 11.4% 9.2% 8.2% as a % of revenue

Adjusted EBITDA as a % of 14.6% 6.0% 15.2% 11.4% 11.9% 10.7% value-add revenue



Q1 2020

Global Segments

Performance Motorparts Clean AirPowertrainTotal CorporateTotal Solutions

Net sales and operating $ 706 $669 $ 1,545$916 $3,836$- $3,836revenues

Less: Substrate - - 700 - 700 - 700 sales

Value-add $ 706 $669 $ 845 $916 $3,136$- $3,136revenues



EBITDA $ (40) $(674) $ 99 $27 $(588)$(86) $(674)

EBITDA as a % of(5.7)% (100.7)% 6.4% 2.9% (15.3)% (17.6)%revenue

EBITDA as a % of(5.7)% (100.7)% 11.7% 2.9% (18.8)% (21.5)%value-add revenue



Adjusted EBITDA $ 73 $38 $ 104 $68 $283 $(44) $239

Adjusted EBITDA 10.3% 5.7% 6.7% 7.4% 7.4% 6.2% as a % of revenue

Adjusted EBITDA as a % of 10.3% 5.7% 12.3% 7.4% 9.0% 7.6% value-add revenue

_____________________________________

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

(2) Tenneco presents the above reconciliation of revenues in order to reflectEBITDA and adjusted EBITDA as a percent of both total revenues and value-addrevenues. Substrate sales include precious metals pricing, which may bevolatile. 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 thecompleted system. While Tenneco original equipment customers assume the risk ofthis volatility, it impacts reported revenue. Excluding substrate salesremoves this impact. Further, presenting EBITDA and adjusted EBITDA as apercent of value-add revenue assists investors in evaluating the company'soperational performance without the impact of such substrate sales. See priorpages for a discussion of EBITDA and adjusted EBITDA.

ATTACHMENT 2

TENNECO INC.

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

Unaudited

(dollars in millions except percents)



% Change increase Q1 2020 Value- Volume, MixQ1 2021 Value- Currency (decrease) add Revenues and Other add Revenues excluding currency

Motorparts $ 706 $9 $ 4 $ 719 0.6%

Performance669 27 91 787 13.6% Solutions

Clean Air 845 27 164 1,036 19.4%

Powertrain 916 41 144 1,101 15.7%

Total Tenneco $ 3,136 $104 $ 403 $ 3,643 12.9% Inc.

________________________________

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

(2) Tenneco presents the above reconciliation of revenues in order to reflectvalue-add revenues separately from the effects of doing business in currenciesother than the U.S. dollar. Additionally, substrate sales include preciousmetals pricing, which may be volatile. Substrate sales occur when, at thedirection of its OE customers, Tenneco purchases catalytic converters orcomponents thereof from suppliers, uses them in its manufacturing processes andsells them as part of the completed system. While Tenneco original equipmentcustomers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Tenneco uses this informationto analyze the trend in revenues before these factors. Tenneco believesinvestors find this information useful in understanding period to periodcomparisons in the company's revenues.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF NON-GAAP MEASURES

Debt net of total cash / Adjusted LTM EBITDA including noncontrolling interests

Unaudited

(dollars in millions except ratios)



March 31,March 31, 2021 2020

Total debt $ 5,235$ 6,012

Total cash, cash equivalents and restricted cash (total cash) 631 770

Debt net of total cash balances ^(1) $ 4,604$ 5,242

Adjusted LTM EBITDA including noncontrolling interests ^(2) (3)$ 1,194$ 1,327

Ratio of debt net of total cash balances to adjusted LTM EBITDA3.9x 4.0x including noncontrolling interests ^(4)

Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q1 2021 LTM

Net income (loss) attributable to Tenneco $(350)$(499)$167 $65 $ (617) Inc.

Net income (loss) attributable to 10 19 19 22 70 noncontrolling interests

Net income (loss) (340) (480) 186 87 (547)

Income tax (expense) 101 (648) (6) (47) (600) benefit

Interest expense (66) (68) (68) (70) (272)

EBIT, Earnings (Loss) before interest expense, (375) 236 260 204 325 income taxes and noncontrolling interests

Depreciation and 159 151 158 155 623 amortization

Total EBITDA including noncontrolling interests $(216)$387 $418 $359 $ 948 ^(2)



Adjustments:

Restructuring and related105 24 6 28 163 expenses

Inventory write-down ^(5)82 (9) - - 73

Other costs (including strategic and transaction8 4 1 8 21 related) ^(6)

Asset impairments ^(7) 29 3 - - 32

Antitrust reserve change - - (11) - (11) in estimate ^(8)

(Gain)/Loss on sale of - - (2) 1 (1) assets or business

Gain on extinguishment of- - (2) (8) (10) debt

OPEB curtailment ^(9) - (21) - - (21)

Total Adjusted EBITDA including noncontrolling $8 $388 $410 $388 $ 1,194 interests ^(3)



Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2020 LTM

Net income (loss) attributable to Tenneco $26 $70 $(313)$(839)$ (1,056)Inc.

Net income (loss) attributable to 19 8 75 13 115 noncontrolling interests

Net income (loss) 45 78 (238) (826) (941)

Income tax (expense) (14) 9 (14) 94 75 benefit

Interest expense (82) (79) (80) (75) (316)

EBIT, Earnings (Loss) before interest expense, 141 148 (144) (845) (700) income taxes and noncontrolling interests

Depreciation and 169 165 170 171 675 amortization

Total EBITDA including noncontrolling interests $310 $313 $26 $(674)$ (25) ^(2)



Adjustments:

Restructuring and related57 28 36 34 155 expenses

Goodwill and intangible - 9 172 383 564 impairment charges ^(10)

Asset impairments ^(7) - - - 471 471

Other costs (including strategic and transaction27 30 30 25 112 related) ^(6)

Antitrust reserve change - (9) - - (9) in estimate ^(8)

Cost reduction 2 6 (1) - 7 initiatives ^(11)

Costs to achieve 7 7 8 - 22 synergies ^(12)

Purchase accounting 3 11 2 - 16 charges ^(13)

Process harmonization ^ 1 - 16 - 17 (14)

Pension adjustments ^(15)- - (2) - (2)

Warranty charge ^(16) 7 1 - - 8

Brazil tax credit ^(17) - (22) - - (22)

Out of period adjustment - 5 - - 5 ^(18)

Impairment of assets held- 8 - - 8 for sale

Total Adjusted EBITDA including noncontrolling $414 $387 $287 $239 $ 1,327 interests ^(3)

_____________________________

(1) Tenneco presents debt net of total cash balances because managementbelieves it is a useful measure of Tenneco's credit position and progresstoward reducing leverage. The calculation is limited in that the company maynot always be able to use cash to repay debt on a dollar-for-dollar basis.

(2) EBITDA including noncontrolling interests represents income before interestexpense, income taxes, noncontrolling interests and depreciation andamortization. EBITDA including noncontrolling interests is not a calculationbased upon GAAP. The amounts included in the EBITDA including noncontrollinginterests calculation, however, are derived from amounts included in thehistorical statements of income data. In addition, EBITDA includingnoncontrolling interests should not be considered as an alternative to netincome (loss) attributable to Tenneco Inc. or operating income as an indicatorof the company's operating performance, or as an alternative to operating cashflows as a measure of liquidity. Tenneco has presented EBITDA includingnoncontrolling interests because it regularly reviews EBITDA includingnoncontrolling interests as a measure of the company's performance. Inaddition, Tenneco believes its investors utilize and analyze the company'sEBITDA including noncontrolling interests for similar purposes. Tenneco alsobelieves EBITDA including noncontrolling interests assists investors incomparing a company's performance on a consistent basis without regard todepreciation and amortization, which can vary significantly depending upon manyfactors. However, the EBITDA including noncontrolling interests measurepresented may not always be comparable to similarly titled measures reported byother companies due to differences in the components of the calculation.

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

(4) Tenneco presents the above reconciliation of the ratio of debt net of totalcash to Adjusted LTM EBITDA including noncontrolling interests to show trendsthat investors may find useful in understanding the company's ability toservice its debt. For purposes of this calculation, Adjusted LTM EBITDAincluding noncontrolling interests is used as an indicator of the company'sperformance and debt net of total cash is presented as an indicator of thecompany's credit position and progress toward reducing the company's financialleverage. This reconciliation is provided as supplemental information and notintended to replace the company's existing covenant ratios or any otherfinancial measures that investors may find useful in describing the company'sfinancial position. See notes (1), (2) and (3) for a description of thelimitations of using debt net of total cash, EBITDA including noncontrollinginterests and Adjusted EBITDA including noncontrolling interests.

(5) Non-cash charge to write-down inventory in the Motorparts segment inconnection with its initiative to rationalize its supply chain and distributionnetwork.

(6) Amounts in prior periods included costs related to the acquisitions andexpected separation.

(7) Asset impairment charges.

(8) Reduction in estimated antitrust accrual.

(9) OPEB curtailment as a result of an amended union agreement that eliminateshealthcare benefits for future retirees.

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

(11) Costs related to cost reduction initiatives.

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

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

(14) Charge due to process harmonization.

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

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

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

(18) Inventory losses attributable to prior periods.

ATTACHMENT 2

TENNECO INC.

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

Unaudited

(dollars in millions)



Q1 2021

Original equipment Aftermarket & Original equipment commercial truck, off- original equipmentTotal light vehicle revenueshighway, industrial service revenues and other revenues

Net sales and $ 2,905 $ 774 $ 1,052 $4,731operating revenues

Less: Substrate906 149 33 1,088 sales

Value-add$ 1,999 $ 625 $ 1,019 $3,643revenues



Q1 2020 ^(3)

Original equipment Aftermarket & Original equipment commercial truck, off- original equipmentTotal light vehicle revenueshighway, industrial service revenues and other revenues

Net sales and $ 2,264 $ 532 $ 1,040 $3,836operating revenues

Less: Substrate573 107 20 700 sales

Value-add$ 1,691 $ 425 $ 1,020 $3,136revenues

% Change Q1 2020 Volume,Q1 2021 increase Value-addCurrencyMix andValue-add(decrease) Revenues Other Revenues excluding currency

Original equipment light $ 1,691$78 $ 230$1,999 13.6% vehicle revenues

Original equipment commercial truck, 425 38 162 625 38.1% off-highway, industrial and other revenues

Aftermarket & original equipment service 1,020 (12) 11 1,019 1.1% revenues

Total Tenneco Inc. $ 3,136$104 $ 403$3,643 12.9%

________________________________________

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

(2) Tenneco presents the above reconciliation of revenues in order to reflectvalue-add revenues separately from the effects of doing business in currenciesother than the U.S. dollar. Additionally, substrate sales include preciousmetals pricing, which may be volatile. Substrate sales occur when, at thedirection of its OE customers, Tenneco purchases catalytic converters orcomponents thereof from suppliers, uses them in its manufacturing processes andsells them as part of the completed system. While Tenneco original equipmentcustomers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Tenneco uses this informationto analyze the trend in revenues before these factors. Tenneco believesinvestors find this information useful in understanding period to periodcomparisons in the company's revenues.

(3) Prior to the second quarter 2020, original equipment service revenues waspreviously classified within original equipment light vehicle revenues andoriginal equipment commercial truck, off-highway, industrial and otherrevenues.

ATTACHMENT 2

TENNECO INC.

RECONCILIATION OF GAAP^(1) REVENUE AND EARNINGS TO NON-GAAP REVENUE AND EARNINGS MEASURES^(2) - Q2, Q3, Q4 & FY 2020 RECAST

Unaudited

(dollars in millions)



Q2 2020

Global Segments

Performance Motorparts Clean AirPowertrainTotal CorporateTotal Solutions

Net sales and operating $559 $378 $ 1,140$560 $2,637 $ - $2,637 revenues

Less: Substrate - - 623 - 623 - 623 sales

Value-add $559 $378 $ 517 $560 $2,014 $ - $2,014 revenues ^(3)



As Previously Reported:

Total EBITDA including $(52) $(70) $ 17 $(62) $(167) $ (49) $(216) noncontrolling interests ^(4)

Adjustments:

Restructuring and related 17 29 21 37 104 1 105 expenses

Inventory 82 - - - 82 - 82 write-down

Asset 24 - - 4 28 1 29 impairments

Other costs (including strategic and - - - - - 8 8 transaction related)

Adjusted EBITDA $71 $(41) $ 38 $(21) $47 $ (39) $8 ^(5)



Recasts for Transfer of Business Line:

Adjustment to Total EBITDA including - 7 - (7) - - - noncontrolling interests

Recast Total EBITDA including(52) (63) 17 (69) (167) (49) (216) noncontrolling interests ^(4)

Total adjustments (no 123 29 21 41 214 10 224 change from what is noted above)

Recast Adjusted $71 $(34) $ 38 $(28) $47 $ (39) $8 EBITDA ^(5)



Recast Adjusted EBITDA as a % of12.7% (9.0)% 7.4% (5.0)% 2.3% 0.4% value-add revenue^ (6)



Q3 2020

Global Segments

Performance Motorparts Clean AirPowertrainTotal CorporateTotal Solutions

Net sales and operating $730 $679 $ 1,919$928 $4,256 $ - $4,256 revenues

Less: Substrate - - 961 - 961 - 961 sales

Value-add $730 $679 $ 958 $928 $3,295 $ - $3,295 revenues ^(3)



As Previously Reported:

Total EBITDA including $138 $23 $ 149 $111 $421 $ (34) $387 noncontrolling interests ^(4)

Adjustments:

Restructuring and related (1) 11 1 13 24 - 24 expenses

Inventory (9) - - - (9) - (9) write-down

Asset 3 - - - 3 - 3 impairments

Other costs (including strategic and - (2) (1) - (3) 7 4 transaction related)

OPEB curtailment- - - - - (21) (21)

Adjusted EBITDA $131 $32 $ 149 $124 $436 $ (48) $388 ^(5)



Recasts for Transfer of Business Line:

Adjustment to Total EBITDA including - 23 - (23) - - - noncontrolling interests

Recast Total EBITDA including138 46 149 88 421 (34) 387 noncontrolling interests^ (4)

Total adjustments (no (7) 9 - 13 15 (14) 1 change from what is noted above)

Recast Adjusted $131 $55 $ 149 $101 $436 $ (48) $388 EBITDA ^(5)



Recast Adjusted EBITDA as a % of17.9% 8.1% 15.6% 10.9% 13.2% 11.8% value-add revenue^ (6)



Q4 2020

Global Segments

Performance Motorparts Clean AirPowertrainTotal CorporateTotal Solutions

Net sales and operating $730 $776 $ 2,117$1,027 $4,650 $ - $4,650 revenues

Less: Substrate - - 1,071 - 1,071 - 1,071 sales

Value-add $730 $776 $ 1,046$1,027 $3,579 $ - $3,579 revenues ^(3)



As Previously Reported:

Total EBITDA including $109 $29 $ 175 $151 $464 $ (46) $418 noncontrolling interests ^(4)

Adjustments:

Restructuring and related 1 3 (1) 1 4 2 6 expenses

Other costs (including strategic and - - (3) - (3) 4 1 transaction related)

Antitrust reserve change - - (11) - (11) - (11) in estimate

(Gain)/Loss on - (3) - - (3) 1 (2) sale of assets

Gain on extinguishment - - - - - (2) (2) of debt

Adjusted EBITDA $110 $29 $ 160 $152 $451 $ (41) $410 ^(5)



Recasts for Transfer of Business Line:

Adjustment to Total EBITDA including - 28 - (28) - - - noncontrolling interests

Recast Total EBITDA including109 57 175 123 464 (46) 418 noncontrolling interests ^(4)

Total adjustments (no 1 - (15) 1 (13) 5 (8) change from what is noted above)

Recast Adjusted $110 $57 $ 160 $124 $451 $ (41) $410 EBITDA ^(5)



Recast Adjusted EBITDA as a % of15.1% 7.3% 15.3% 12.1% 12.6% 11.5% value-add revenue^ (6)



Q4 2020 YTD

Global Segments

Performance Motorparts Clean AirPowertrainTotal CorporateTotal Solutions

Net sales and operating $2,725 $2,502 $ 6,721$3,431 $15,379$ - $15,379revenues

Less: Substrate - - 3,355 - 3,355 - 3,355 sales

Value-add $2,725 $2,502 $ 3,366$3,431 $12,024$ - $12,024revenues ^(3)



As Previously Reported:

Total EBITDA including $155 $(595) $ 440 $130 $130 $ (215)$(85) noncontrolling interests ^(4)

Adjustments:

Restructuring and related 20 68 22 51 161 8 169 expenses

Inventory 73 - - - 73 - 73 write-down

Asset 27 455 - 4 486 17 503 impairments

Other costs (including strategic and - (2) - - (2) 40 38 transaction related)

Antitrust reserve change - - (11) - (11) - (11) in estimate

(Gain)/Loss on - (3) - - (3) 1 (2) sale of assets

Gain on extinguishment - - - - - (2) (2) of debt

OPEB curtailment- - - - - (21) (21)

Goodwill and intangible 110 113 - 160 383 - 383 impairment charges

Adjusted EBITDA $385 $36 $ 451 $345 $1,217 $ (172)$1,045 ^(5)



Recasts for Transfer of Business Line:

Adjustment to Total EBITDA including - (39) - 39 - - - noncontrolling interests

Recast Total EBITDA including155 (634) 440 169 130 (215) (85) noncontrolling interests ^(4)

Total 230 750 11 96 1,087 43 1,130 adjustments

Recast Adjusted $385 $116 $ 451 $265 $1,217 $ (172)$1,045 EBITDA ^(5)



Recast Adjusted EBITDA as a % of14.1% 4.6% 13.4% 7.7% 10.1% 8.7% value-add revenue ^(6)

________________________________________

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

(2) Tenneco presents the above reconciliation of revenues in order to reflectEBITDA and adjusted EBITDA as a percent of value-add revenues. Substrate salesinclude precious metals pricing, which may be volatile. Substrate sales occurwhen, at the direction of its OE customers, Tenneco purchases catalyticconverters or components thereof from suppliers, uses them in its manufacturingprocesses and sells them as part of the completed system. While Tennecooriginal equipment customers assume the risk of this volatility, it impactsreported revenue. Excluding substrate sales removes this impact. Further,presenting EBITDA and adjusted EBITDA as a percent of value-add revenue assistsinvestors in evaluating the company's operational performance without theimpact of such substrate sales. See prior pages for a discussion of EBITDA andadjusted EBITDA.

(3) Tenneco presents the above reconciliation of revenues in order to reflectvalue-add revenues separately from substrate sales. Substrate sales includeprecious metals pricing, which may be volatile. Substrate sales occur when, atthe direction of its OE customers, Tenneco purchases catalytic converters orcomponents thereof from suppliers, uses them in its manufacturing processes andsells them as part of the completed system. While Tenneco original equipmentcustomers assume the risk of this volatility, it impacts reported revenue. Excluding substrate sales removes this impact. Tenneco uses this informationto analyze the trend in revenues before these factors. Tenneco believesinvestors find this information useful in understanding period to periodcomparisons in the company's revenues.

(4) EBITDA including noncontrolling interests represents income before interestexpense, income taxes, noncontrolling interests and depreciation andamortization. EBITDA including noncontrolling interests is not a calculationbased upon GAAP. The amounts included in the EBITDA including noncontrollinginterests calculation, however, are derived from amounts included in thehistorical statements of income data. In addition, EBITDA includingnoncontrolling interests should not be considered as an alternative to netincome attributable to Tenneco Inc. or operating income as an indicator of thecompany's operating performance, or as an alternative to operating cash flowsas a measure of liquidity. Tenneco has presented EBITDA includingnoncontrolling interests because it regularly reviews EBITDA includingnoncontrolling interests as a measure of the company's performance. Inaddition, Tenneco believes its investors utilize and analyze the company'sEBITDA including noncontrolling interests for similar purposes. Tenneco alsobelieves EBITDA including noncontrolling interests assists investors incomparing a company's performance on a consistent basis without regard todepreciation and amortization, which can vary significantly depending upon manyfactors. However, the EBITDA including noncontrolling interests measurepresented may not always be comparable to similarly titled measures reported byother companies due to differences in the components of thecalculation.

(5) "Adjusted EBITDA" is EBITDA including noncontrolling interests (aftergiving effect to the reclassification and segment change described above) andis presented in order to reflect the results in a manner that allows a betterunderstanding of operational activities separate from the financial impact ofdecisions made for the long term benefit of the company and other itemsimpacting comparability between the periods. Similar adjustments to EBITDAincluding noncontrolling interests have been recorded in earlier periods, andsimilar types of adjustments can reasonably be expected to be recorded infuture periods. The company believes investors find the non-GAAP informationhelpful in understanding the ongoing performance of operations separate fromitems that may have a disproportionate positive or negative impact on thecompany's financial results in any particular period.

(6) Tenneco presents the above reconciliation in order to reflect AdjustedEBITDA as a percent of value-add revenues. Presenting Adjusted EBITDA as apercent of value-add revenue assists investors in evaluating the company'soperational performance without the impact of substrate sales, which can bevolatile.

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SOURCE Tenneco Inc.