Table of ~~Operations. A liability of $5.4 million is included in “Accrued liabilities” in the Condensed Consolidated Balance Sheets as of September 30, 2017.~~Content

The following assumptions were used to estimate the fair value of ~~DSUs at~~performance share units granted during the ~~time of grant~~six month periods ended June 30, 2021 and 2020 using the ~~Finnerty discount for lack of marketability~~Monte Carlo simulation pricing ~~model:~~model.

~~Nine Months~~


	For the Six Month Period Ended June 30,
Assumptions	2021		2020
Expected term (in years)	2.9		2.8
Risk-free interest rate	0.2	%	0.5	%
Assumed volatility	36.9	%	35.2	%
Expected dividend rate	0	%	0	%

~~Ended~~

~~September 30,~~

~~2017~~

~~Assumptions:~~

~~Average length of holding period restrictions (years)~~

~~1.42~~

~~Assumed volatility~~

~~5.15~~

~~2017 Omnibus Incentive Plan~~

In May 2017, the Company’s Board approved the 2017 Omnibus Incentive Plan (“2017 Plan”). Under the terms of the Plan, the Company’s Board may grant up to 8.6 million stock based and other incentive awards. Any shares of common stock subject to outstanding awards granted under our 2013 Stock Incentive Plan that, after the effective date of the 2017 Plan, expire or are otherwise forfeited or terminated in accordance with their terms are also available for grant under the 2017 Plan. As of September 30, 2017, no awards have been granted from the 2017 Plan.

~~Index~~

Note ~~10.~~11. Accumulated Other Comprehensive Income (Loss) ~~Income~~

The Company’s other comprehensive income (loss) consists of (i) unrealized foreign currency net gains and losses on the translation of the assets and liabilities of its foreign operations; (ii) realized and unrealized foreign currency gains and losses on intercompany notes of a long-term nature and certain hedges of net investments in foreign operations, net of income taxes; (iii) unrealized gains and losses on cash flow hedges (consisting of interest rate swaps), net of income taxes; and (iv) pension and other postretirement prior service cost and actuarial gains or losses, net of income taxes. See Note 8 “Benefit Plans” and Note 12 “Hedging Activities, Derivative Instruments and Fair Value Measurements.”

The before tax income (loss), and related income tax effect ~~and accumulated balances~~ are as ~~follows:~~follows.


	For the Three Month Period Ended June 30, 2021						For the Three Month Period Ended June 30, 2020
	Before-Tax Amount		Tax Benefit or (Expense)		Net of Tax Amount		Before-Tax Amount		Tax Benefit or (Expense)		Net of Tax Amount
Foreign currency translation adjustments, net	$	51.0	$	(1.9)	$	49.1	$	41.9	$	3.0	$	44.9
Unrecognized gains on cash flow hedges, net	0		0		0		7.3		(1.8)		5.5
Pension and other postretirement benefit prior service cost and gain or loss, net	1.5		(0.2)		1.3		0.4		0.1		0.5
Other comprehensive income (loss)	$	52.5	$	(2.1)	$	50.4	$	49.6	$	1.3	$	50.9

For the Three Months Ended
September 30, 2017

For the Nine Months Ended
September 30, 2017

Before-Tax
Amount

Tax
Benefit
or (Expense)

Net of Tax
Amount

Before-Tax
Amount

Tax
Benefit
or (Expense)

Net of Tax
Amount

Foreign currency translation adjustments, net $ 41.5 $ - $ 41.5 $ 131.4 $ - $ 131.4
Foreign currency (losses) gains, net (23.5 ) 8.7 (14.8 ) (71.2 ) 26.9 (44.3 )
Unrecognized (losses) gains on cash flow hedges, net 5.5 (1.5 ) 4.0 8.9 (3.4 ) 5.5
Pension and other postretirement benefit prior service cost and gain or loss, net (1.1 ) 0.5 (0.6 ) (3.4 ) 1.5 (1.9 )
Other comprehensive income $ 22.4 $ 7.7 $ 30.1 $ 65.7 $ 25.0 $ 90.7


	For the Six Month Period Ended June 30, 2021						For the Six Month Period Ended June 30, 2020
	Before-Tax Amount		Tax Benefit or (Expense)		Net of Tax Amount		Before-Tax Amount		Tax Benefit or (Expense)		Net of Tax Amount
Foreign currency translation adjustments, net	$	(56.2)	$	5.5	$	(50.7)	$	(47.7)	$	0.4	$	(47.3)
Unrecognized gains on cash flow hedges, net	0		0		0		8.8		(2.1)		6.7
Pension and other postretirement benefit prior service cost and gain or loss, net	3.0		(0.5)		2.5		3.9		(0.5)		3.4
Other comprehensive income (loss)	$	(53.2)	$	5.0	$	(48.2)	$	(35.0)	$	(2.2)	$	(37.2)

For the Three Months Ended
September 30, 2016

For the Nine Months Ended
September 30, 2016

Before-Tax
Amount

Tax
(Expense)
or Benefit

Net of Tax
Amount

Before-Tax
Amount

Tax
(Expense)
or Benefit

Net of Tax
Amount

Foreign currency translation adjustments, net $ (29.4 ) $ - (29.4 ) $ 12.8 $ - $ 12.8
Foreign currency gains (losses), net 11.2 (3.1 ) 8.1 (18.2 ) 7.4 (10.8 )
Unrecognized gains (losses) on cash flow hedges, net (4.5 ) 1.7 (2.8 ) (21.7 ) 8.2 (13.5 )
Pension and other postretirement benefit prior service cost and gain or loss, net 6.2 (1.0 ) 5.2 7.5 (1.2 ) 6.3
Other comprehensive income (loss) $ (16.5 ) $ (2.4 ) $ (18.9 ) $ (19.6 ) $ 14.4 $ (5.2 )

The tables above include only the other comprehensive income (loss), net of tax, attributable to Ingersoll Rand Inc. Other comprehensive loss, net, attributable to noncontrolling interest holders was $1.2 million and $0.4 million for the three month periods ended June 30, 2021 and 2020, respectively, and $2.3 million and $4.4 million for the six month periods ended June 30, 2021 and 2020, respectively, and related entirely to foreign currency translation adjustments.

~~Index~~25

Table of Content

Changes in accumulated other comprehensive income (loss) ~~income~~ by component for the ~~nine~~six month periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016~~2020 are presented in the following ~~tables~~ ^table(1):.

Cumulative
Currency
Translation
Adjustment

Foreign
Currency
Gains and
(Losses)

Unrealized
(Losses) Gains
on Cash Flow
Hedges

Pension and
Postretirement
Benefit Plans
Total

Balance at December 31, 2016 $ (324.2 ) $ 88.6 $ (42.2 ) $ (64.6 ) $ (342.4 )
Other comprehensive income (loss) before reclassifications 131.4 (44.3 ) (3.1 ) (4.2 ) 79.8
Amounts reclassified from accumulated other comprehensive (loss) income - - 8.6 2.3 10.9
Net current-period other comprehensive income (loss) 131.4 (44.3 ) 5.5 (1.9 ) 90.7
Balance at September 30, 2017 $ (192.8 ) $ 44.3 $ (36.7 ) $ (66.5 ) $ (251.7 )

Cumulative
Currency
Translation
Adjustment

Foreign
Currency
Gains and
(Losses)

Unrealized
(Losses) Gains
on Cash Flow
Hedges

Pension and
Postretirement
Benefit Plans
Total

Balance at December 31, 2015 $ (248.0 ) $ 75.0 $ (41.3 ) $ (51.3 ) $ (265.6 )
Other comprehensive income (loss) before reclassifications 12.8 (10.8 ) (18.5 ) 4.8 (11.7 )
Amounts reclassified from accumulated other comprehensive (loss) income - - 5.0 1.5 6.5
Net current-period other comprehensive income (loss) 12.8 (10.8 ) (13.5 ) 6.3 (5.2 )
Balance at September 30, 2016 $ (235.2 ) $ 64.2 $ (54.8 ) $ (45.0 ) $ (270.8 )


	Foreign Currency Translation Adjustments, Net		Unrecognized Gains (Losses) on Cash Flow Hedges		Pension and Other Postretirement Benefit Plans		Total
Balance as of December 31, 2020	$	74.6	$	0	$	(60.4)	$	14.2
Other comprehensive income (loss) before reclassifications	(50.7)		0		0.6		(50.1)
Amounts reclassified from accumulated other comprehensive income (loss)	0		0		1.9		1.9
Other comprehensive income (loss)	(50.7)		0		2.5		(48.2)
Divestiture of foreign subsidiaries	(1.5)		0		0		(1.5)
Balance as of June 30, 2021	$	22.4	$	0	$	(57.9)	$	(35.5)

⁽¹⁾

~~All amounts are net of tax. Amounts in parentheses indicate debits.~~


	Foreign Currency Translation Adjustments, Net		Unrecognized Gains (Losses) on Cash Flow Hedges		Pension and Other Postretirement Benefit Plans		Total
Balance as of December 31, 2019	$	(193.6)	$	(10.9)	$	(51.5)	$	(256.0)
Other comprehensive income (loss) before reclassifications	(47.3)		(3.2)		2.3		(48.2)
Amounts reclassified from accumulated other comprehensive income (loss)	0		9.9		1.1		11.0
Other comprehensive income (loss)	(47.3)		6.7		3.4		(37.2)

Balance as of June 30, 2020	$	(240.9)	$	(4.2)	$	(48.1)	$	(293.2)

~~Index~~

(1)All amounts are net of tax. Amounts in parentheses indicate debits.

Reclassifications out of accumulated other comprehensive income (loss) ~~income~~ for the ~~nine~~six month periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016~~2020 are presented in the following ~~table:~~table.

Amount Reclassified from Accumulated Other Comprehensive (Loss) Income
Details about Accumulated
Other Comprehensive
(Loss) Income Components

For the
Nine Months
Ended
September 30,
2017

For the
Nine Months
Ended
September 30,
2016

Affected Line in the
Statement Where Net
Income is Presented

Loss on cash flow hedges
Interest rate swaps $ 13.9 $ 8.1 Interest expense
13.9 8.1 Total before tax
(5.3 ) (3.1 ) Provision (benefit) for income taxes
$ 8.6 $ 5.0 Net of tax
Amortization of defined benefit pension and other postretirement benefit items $ 3.7 $ 2.4
⁽¹⁾
3.7 2.4 Total before tax
(1.4 ) (0.9 ) Provision (benefit) for income taxes
$ 2.3 $ 1.5 Net of tax
Total reclassifications for the period $ 10.9 $ 6.5 Net of tax


Amount Reclassified from Accumulated Other Comprehensive Income (Loss)
Details about Accumulated Other Comprehensive Income (Loss) Components	For the Six Month Period Ended June 30, 2021				Affected Line(s) in the Statement Where Net Income is Presented
	2021		2020
Loss on cash flow hedges (interest rate swaps)	$	0	$	13.2	Interest expense
Benefit for income taxes	0		(3.3)		Benefit for income taxes
Loss on cash flow hedges (interest rate swaps), net of tax	$	0	$	9.9

Amortization of defined benefit pension and other postretirement benefit items(1)	$	2.6	$	1.5	Cost of sales and Selling and administrative expenses
Benefit for income taxes	(0.7)		(0.4)		Benefit for income taxes
Amortization of defined benefit pension and other postretirement benefit items, net of tax	$	1.9	$	1.1

Total reclassifications for the period, net of tax	$	1.9	$	11.0

⁽¹⁾

~~These components are included in the computation of net periodic benefit cost. See Note 7 “Pension and Other Postretirement Benefits” for additional details.~~

(1)These components are included in the computation of net periodic benefit cost. See Note 8 “Benefit Plans” for additional details.

Table of Content

Note ~~11.~~12. Hedging Activities, Derivative Instruments and Fair Value Measurements

Hedging Activities

The Company is exposed to certain market risks during the normal course of its business arising from adverse changes in interest rates and foreign currency exchange rates. The Company selectively uses derivative financial instruments (“derivatives”), including foreign currency forward contracts and interest rate swaps, to manage the risks from fluctuations in foreign currency exchange rates and interest rates, respectively. The Company does not purchase or hold derivatives for trading or speculative purposes. Fluctuations in interest rates and foreign currency exchange rates can be volatile, and the Company’s risk management activities do not totally eliminate these risks. Consequently, these fluctuations could have a significant effect on the Company’s financial results.

The Company’s exposure to interest rate risk results primarily from its variable-rate borrowings. The Company manages its debt centrally, considering tax consequences and its overall financing strategies. The Company manages its exposure to interest rate risk by ~~maintaining a mixture of fixed and variable rate debt and, from time to time,~~ using pay-fixed interest rate swaps, from time to time, as cash flow hedges of variable rate debt in order to adjust the relative fixed and variable proportions.

A substantial portion of the Company’s operations is conducted by its subsidiaries outside of the United States in currencies other than the USD. Almost all of the Company’s non-U.S. subsidiaries conduct their business primarily in their local currencies, which are also their functional currencies. Other than the USD, the EUR, GBP, Chinese Renminbi and ~~Chinese Yuan~~Indian rupee are the principal currencies in which the Company and its subsidiaries enter into transactions. The Company is exposed to the impacts of changes in foreign currency exchange rates on the translation of its non-U.S. subsidiaries’ assets, liabilities and earnings into USD. The Company has certain U.S. subsidiaries borrow in currencies other than the USD.

The Company and its subsidiaries are also subject to the risk that arises when they, from time to time, enter into transactions in currencies other than their functional currency. To mitigate this risk, the Company and its subsidiaries typically settle intercompany trading balances ~~monthly.~~at least quarterly. The Company also selectively uses forward currency contracts to manage this risk. These contracts for the sale or purchase of European and other currencies generally mature within one year.

~~Index~~

Derivative Instruments

The following table summarizes the notional amounts, fair values and classification of the Company’s outstanding derivatives by risk category and instrument type within the Condensed Consolidated Balance Sheets ~~at September~~as of June 30, ~~2017~~2021 and December 31, ~~2016:~~2020.


June 30, 2021												June 30, 2021
Derivative Classification												Derivative Classification		Notional Amount(1)		Fair Value(1) Other Current Assets		Fair Value(1) Other Assets		Fair Value(1) Accrued Liabilities		Fair Value(1) Other Liabilities
	September 30, 2017
	Derivative Classification	Notional Amount ⁽¹⁾		Fair Value ⁽¹⁾ Other Current Assets		Fair Value ⁽¹⁾ Other Assets		Fair Value ⁽¹⁾ Accrued Liabilities		Fair Value ⁽¹⁾ Other Liabilities
Derivatives Designated as Hedging Instruments
Interest rate swap contracts	Cash Flow	$	1,125.0	$	-	$	-	$	8.0	$	49.7
Derivatives Not Designated as Hedging Instruments
Foreign currency forwards	Fair Value	$	97.4	$	0.8	$	-	$	-	$	-

	December 31, 2016
	Derivative Classification	Notional Amount ⁽¹⁾		Fair Value ⁽¹⁾ Other Current Assets		Fair Value ⁽¹⁾ Other Assets		Fair Value ⁽¹⁾ Accrued Liabilities		Fair Value ⁽¹⁾ Other Liabilities
Derivatives Designated as Hedging Instruments
Cross currency interest rate swap contracts	Net Investment	$	200.0	$	-	$	26.8	$	-	$	-
Interest rate swap contracts	Cash Flow	$	1,125.0	$	-	$	-	$	16.3	$	47.2
Derivatives Not Designated as Hedging Instruments												Derivatives Not Designated as Hedging Instruments
Foreign currency forwards	Fair Value	$	79.0	$	0.9	$	-	$	-	$	-	Foreign currency forwards	Fair Value	$	78.3	$	0.4	$	0	$	0	$	0
Foreign currency forwards	Fair Value	$	42.8	$	-	$	-	$	0.2	$	-	Foreign currency forwards	Fair Value	100.6		0		0		0.8		0

⁽¹⁾

Notional amounts represent the gross contract amounts of the outstanding derivatives excluding the total notional amount of positions that have been effectively closed through offsetting positions. The net gains and net losses associated with positions that have been effectively closed through offsetting positions but not yet settled are included in the asset and liability derivatives fair value columns, respectively.


December 31, 2020
Derivative Classification		Notional Amount(1)		Fair Value(1) Other Current Assets		Fair Value(1) Other Assets		Fair Value(1) Accrued Liabilities		Fair Value(1) Other Liabilities


Derivatives Not Designated as Hedging Instruments
Foreign currency forwards	Fair Value	$	230.5	$	2.9	$	0	$	0	$	0
Foreign currency forwards	Fair Value	51.2		0		0		0.7		0

(1)Notional amounts represent the gross contract amounts of the outstanding derivatives excluding the total notional amount of positions that have been effectively closed through offsetting positions. The net gains and net losses associated with positions that have been effectively closed through offsetting positions but not yet settled are included in the asset and liability derivatives fair value columns, respectively.

~~Gains and losses~~

Table of Content

Losses on derivatives designated as cash flow hedges included in the Condensed Consolidated Statements of Comprehensive Income (Loss) ~~Income~~ for the three and ~~nine~~six month periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016,~~2020 are as presented in the table ~~below:~~below.

For the Three
Months Ended
September 30,

For the Nine
Months Ended
September 30,

2017 2016 2017 2016
Interest rate swap contracts ⁽¹⁾

Gain (loss) recognized in AOCI on derivatives (effective portion) $ 1.4 $ 0.3 $ (4.9 ) $ (29.8 )
Loss reclassified from AOCI into income (effective portion) (4.1 ) (1.7 ) (13.9 ) (8.1 )
(Loss) gain recognized in income on derivatives (ineffective portion and amount excluded from effectiveness testing) (2.1 ) (0.6 ) (2.1 ) 0.2


	For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
	2021		2020		2021		2020
Interest rate swap contracts
Loss recognized in AOCI on derivatives	$	0	$	(0.6)	$	0	$	(4.3)
Loss reclassified from AOCI into income (effective portion)(1)	0		(7.9)		0		(13.2)

⁽¹⁾

Losses on derivatives reclassified from accumulated other comprehensive income (“AOCI”) into income (effective portion) were included in “Interest expense” in the Condensed Consolidated Statements of Operations. Ineffective portions of changes in the fair value of cash flow hedges were recognized in earnings and included in “Interest expense” in the Condensed Consolidated Statements of Operations.

(1)Losses on derivatives reclassified from accumulated other comprehensive income (“AOCI”) into income were included within “Interest expense” in the Condensed Consolidated Statements of Operations.

~~Index~~

~~At September~~As of June 30, ~~2017,~~2021, the Company ~~is the fixed~~has 0 interest rate ~~payor on 15~~swap contracts. Our previous interest rate swap contracts that effectively fix the LIBOR-based index used to determine the interest rates charged on a total of $1,125.0 million of the Company’s LIBOR-based variable rate borrowings. These contracts carry fixed rates ranging from 2.9% to 4.4% and have expiration dates ranging from 2017 to 2020. These swap agreements qualify as hedging instruments and have been designated as cash flow hedges of forecasted LIBOR-based interest payments. Based on LIBOR-based swap yield curves as of September 30, 2017, the Company expects to reclassify losses of $19.6 million out of AOCI into earningsexpired during the ~~next 12 months.~~third quarter of 2020 and the remaining amounts in AOCI were reclassified to Interest expense during the same period. The Company’s LIBOR-based variable rate borrowings outstanding ~~at September~~as of June 30, ~~2017~~2021 were ~~$1,285.5~~$3,188.2 million and ~~€615.0~~€593.6 million.

The Company had ~~four~~7 foreign currency forward contracts outstanding as of ~~September~~June 30, ~~2017~~2021 with notional amounts ranging from ~~$2.8~~$10.8 million to ~~$45.8~~$48.4 million. These contracts are used to hedge the change in fair value of recognized foreign currency denominated assets or liabilities caused by changes in currency exchange rates. The changes in the fair value of these contracts generally offset the changes in the fair value of a corresponding amount of the hedged items, both of which are included ~~in the~~within “Other operating expense, net” ~~line on the face of~~in the Condensed Consolidated Statements of Operations. The Company’s foreign currency forward contracts are subject to master netting arrangements or agreements between the Company and each counterparty for the net settlement of all contracts through a single payment in a single currency in the event of default on or termination of any one contract with that certain counterparty. It is the Company’s practice to recognize the gross amounts in the Condensed Consolidated Balance Sheets. The amount available to be netted is not material.

The Company’s gains (losses) ~~gains~~ on derivative instruments not designated as accounting hedges and total net foreign currency ~~(losses) gains~~losses for the three and ~~nine~~six month periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016~~2020 were as ~~follows:~~follows.

For the Three
Months Ended
September 30,

For the Nine
Months Ended
September 30,

2017 2016 2017 2016
Foreign currency forward contracts (losses) gains $ (1.8 ) $ 1.8 $ (6.7 ) $ 14.0
Total net foreign currency (losses) gains (1.7 ) (0.5 ) (6.3 ) 2.6


	For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
	2021		2020		2021		2020
Foreign currency forward contracts gains (losses)	$	0.7	$	0.5	$	(0.1)	$	(2.1)
Total foreign currency transaction gains (losses), net	(3.4)		(4.9)		14.7		(6.9)

The Company has a significant investment in consolidated subsidiaries with functional currencies other than the USD, particularly the EUR. The Company designated its Original Euro Term Loan of approximately €387.0 million as of December 31, 2016 as a hedge of the Company’s net investment in subsidiaries with EUR functional currencies. The Original Euro Term Loan remained designated as a net investment hedge during 2017 until it was extinguished and replaced on August 17, 2017 by the €615.0 million Euro Term Loan, further described in Note 8 “Debt.” On August 17, 2017, the Company designated ~~the €615.0~~its €615.0 million Original Euro Term Loan as a hedge of the Company’s net investment in subsidiaries with EUR functional ~~currencies.~~

~~In December 2014,~~currencies until it was extinguished and replaced on February 28, 2020 by a €601.2 million Euro Term Loan, further described in Note 9 “Debt”. As of June 30, 2021, the ~~Company entered into two cross currency interest rate swaps each with a USD notional amount~~Euro Term Loan of ~~$100~~€593.6 million to further hedge the risk of changes in the USD equivalent value of its net investment in EUR functional currency subsidiaries. The cross currency interest rate swaps were designated as hedges for the three and nine month periods ended September 30, 2016 and for the period from January 1, 2017 until August 16, 2017 when they were terminated for proceeds of $6.2 million. The proceeds from the termination of the cross currency interest rate swaps are included in the “Proceeds from the termination of derivatives” line in the Condensed Consolidated Statements of Cash Flows. The recorded AOCI at the termination of the cross currency interest rate swaps will remain in AOCI until there is a substantial liquidation of the Company’s net investment in subsidiaries with EUR functional currencies.

~~The losses and gains from the change in fair value related to the effective portions of the net investment hedges were recorded through other comprehensive income.~~

~~Index~~

remained designated.

The Company’s gains ~~and~~ (losses), net of income tax, associated with changes in the value of debt ~~and designated cross currency interest rate swaps~~ for the three ~~month~~ and ~~nine~~six month periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016, and the~~2020 were as follows.


	For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
	2021		2020		2021		2020
Gain, net of income tax, recorded through other comprehensive income	$	(5.7)	$	(9.1)	$	13.2	$	0.9

The net balance of such gains ~~and~~ (losses) included in accumulated other comprehensive income ~~for~~(loss) as of June 30, 2021 and 2020 was $43.9 million and $74.9 million, respectively.

For the ~~same~~ periods ~~were as follows:~~

For the Three
Months Ended
September 30,

For the Nine
Months Ended
September 30,

2017 2016 2017 2016
(Loss) gain, net of income tax, recorded through other comprehensive income $ (13.6 ) $ (5.1 ) $ (43.2 ) $ (11.6 )
Balance included in accumulated other comprehensive (loss) income at September 30, 2017 and 2016, respectively $ 39.2 $ 58.1

~~With the exception of the cash proceeds from the termination of the cross currency interest rate swap contracts described earlier,~~presented, all cash flows associated with derivatives are classified as operating cash flows in the Condensed Consolidated Statements of Cash Flows.

Table of Content

Fair Value Measurements

A financial instrument is defined as cash or cash equivalents, evidence of an ownership interest in an entity, or a contract that creates a contractual obligation or right to deliver or receive cash or another financial instrument from another party. The Company’s financial instruments consist primarily of cash and cash equivalents, trade accounts receivables, trade accounts payables, deferred compensation assets and obligations, derivatives and debt instruments. The carrying values of cash and cash equivalents, trade accounts receivables, trade accounts payables, and variable rate debt instruments are a reasonable estimate of their respective fair values.

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or more advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value as ~~follows:~~follows.

Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities as of the reporting date.

~~Level 1~~

~~Quoted prices (unadjusted) in active markets for identical~~Level 2 Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities as of the reporting date.

~~Level 2~~

~~Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or~~ liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities as of the reporting date.

~~Level 3~~

Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The following ~~table summarizes~~tables summarize the Company’s financial assets and liabilities measured at fair value on a recurring basis as of ~~September~~June 30, ~~2017:~~2021 and December 31, 2020.


										June 30, 2021
	Level 1		Level 2		Level 3		Total			Level 1		Level 2		Level 3		Total
Financial Assets									Financial Assets
Foreign currency forwards ⁽¹⁾	$	-	$	0.8	$	-	$	0.8	Foreign currency forwards(1)	$	0	$	0.4	$	0	$	0.4
Trading securities held in deferred compensation plan ⁽²⁾		5.3		-		-		5.3	Trading securities held in deferred compensation plan(2)	11.2		0		0		11.2
Total	$	5.3	$	0.8	$	-	$	6.1	Total	$	11.2	$	0.4	$	0	$	11.6
Financial Liabilities									Financial Liabilities
Interest rate swaps ⁽³⁾	$	-	$	57.7	$	-	$	57.7
Deferred compensation plan ⁽²⁾		5.3		-		-		5.3
Foreign currency forwards(1)									Foreign currency forwards(1)	$	0	$	0.8	$	0	$	0.8
Deferred compensation plans(2)									Deferred compensation plans(2)	25.1		0		0		25.1

Total	$	5.3	$	57.7	$	-	$	63.0	Total	$	25.1	$	0.8	$	0	$	25.9

⁽¹⁾

~~Based on calculations that use readily observable market parameters as their basis, such as spot and forward rates.~~


	December 31, 2020
	Level 1		Level 2		Level 3		Total
Financial Assets
Foreign currency forwards(1)	$	0	$	2.9	$	0	$	2.9
Trading securities held in deferred compensation plan(2)	9.1		0		0		9.1
Total	$	9.1	$	2.9	$	0	$	12.0
Financial Liabilities
Foreign currency forwards(1)	$	0	$	0.7	$	0	$	0.7
Deferred compensation plan(2)	25.7		0		0		25.7

Total	$	25.7	$	0.7	$	0	$	26.4

(1)Based on calculations that use readily observable market parameters at their basis, such as spot and forward rates.

(2)Based on the quoted price of publicly traded mutual funds and other equity securities which are classified as trading securities and accounted for using the mark-to-market method.

⁽²⁾

~~Based on the quoted price of publicly traded mutual funds which are classified as trading securities and accounted for using the mark-to-market method.~~

⁽³⁾

Measured as the present value of all expected future cash flows based on the LIBOR-based swap yield curves as of September 30, 2017. The present value calculation uses discount rates that have been adjusted to reflect the credit quality of the Company and its counterparties.

Table of Content

Table of compensation expense related to a grant of 5.5 million deferred stock units (“DSU”) to employees at the date of the initial public offering. The Company expects to make stock-based awards to employees and recognize stock-based compensation expenses in future periods.Content

Outlook

~~Industrials~~Industrial Technologies and Services Segment

The mission-critical nature of our ~~Industrials~~ products across manufacturing processes drives a demand environment and outlook that are ~~highly~~ correlated with global and regional industrial production, capacity utilization and long-term GDP growth. Economic conditions remain uncertain with regard to COVID-19, and its impact on end markets, however, recent order rates have begun to improve as markets strengthened and gained greater visibility to vaccine roll-out strategies in various regions. In the United States and Europe, we are poised to continue benefiting from expected growth in real GDP, along with an expected rebound in industrial production activity in 2017 and 2018. In APAC, despite the recent deceleration, GDP growth remains robust. In the thirdsecond quarter of ~~2017,~~2021, we had ~~$294.4~~$1,204.0 million of orders in our ~~Industrials~~Industrial Technologies and Services segment, an increase of ~~14%~~52.8% over the ~~third~~second quarter of ~~2016, or an 11% increase on a constant currency basis.~~2020.

~~Energy~~Precision and Science Technologies Segment

~~Our Energy~~During the COVID-19 pandemic, the Precision and Science Technologies segment has ~~a diverse range~~seen increased demand for our vacuum pump and compressor solutions used in respirator and ventilator applications. Demand of ~~equipment and associated aftermarket parts, consumables~~other products and services ~~for a number of market sectors with energy exposure, spanning upstream, midstream, downstream~~which had been negatively impacted in 2020 have begun to recover in 2021 as markets strengthened and ~~petrochemical applications. Demand for certain of our Energy products has historically corresponded~~gained greater visibility to the supply and demand dynamics related to oil and natural gas products, and has been influenced by oil and natural gas prices, the level and intensity of hydraulic fracturing activity, rig count, drilling activity and other economic factors. These factors have caused the level of demand for certain of our Energy products to change at times (both positively and negatively) and we expect these trends to continuevaccine roll-out strategies in ~~the future.~~various regions. In the ~~third~~second quarter of ~~2017,~~2021, we had ~~$251.1~~$255.2 million of orders in our ~~Energy~~Precision and Science Technologies segment, an increase of ~~48%~~26.8% over ~~the third quarter of 2016, or a 46% increase on a constant currency basis.~~2020.

An increased number of drilling rigs have reentered the market as crude oil prices have improved from lowpoints observed during the first half of 2016 and the number of drilled but uncompleted wells has grown 72% from December 2013 to September 2017. We believe we are well positioned to benefit from the expected growth in drilling rigs and improvements in crude oil prices. In addition, secular industry trends that are driving increased demand of newer, fit-for-purpose equipment with innovations that increase productivity and are increasing the frequency of replacement, refurbishment and upgrade cycles of pumping equipment and associated consumable products used in drilling and particularly hydraulic fracturing activity by increasing the intensity of such activities. As a result of our expanded direct aftermarket service locations, particularly within North America, we believe we are well positioned to benefit from both the increasing intensity of hydraulic fracturing activity and the increase in the backlog of drilled but uncompleted wells. We expect both trends to positively impact our hydraulic fracturing and drilling product mix and our aftermarket to original equipment ratio within the Energy segment.

Our midstream and downstream products provide relatively stable demand with attractive, long-term growth trends related to an expected increase in the production and transportation of hydrocarbons. Demand for our petrochemical industry products correlates with growth in the development of new petrochemical plants as well as activity levels therein. Advancements in the development of unconventional natural gas resources in North America over the past decade have resulted in the abundant availability of locally-sourced natural gas as feedstock for petrochemical plants in North America, supporting long-term growth.

~~Medical Segment~~

We believe that demand for products and services in the Medical space will continue to benefit from attractive secular growth trends in the aging population requiring medical care, emerging economies modernizing and expanding their healthcare systems and increased investment globally in health solutions. In addition, we expect growing demand for higher healthcare efficiency, requiring premium and high performance systems. During 2016, we focused on the development and introduction of new products and applications to access the liquid pump market, leveraging our technology and expertise in gas pumps. We expect 2017 to be a transition year; while a large customer has elected to dual source its requirements for gas pumps, we are also expanding into the liquid pump market and diversifying our customer base. Revenues for the third quarter of 2017 increased 7% when excluding the impacts of foreign currency and the dual sourcing customer transition. In the third quarter of 2017, we had $61.1 million of orders in our Medical segment, an increase of 19% over the third quarter of 2016, or a 17% increase on a constant currency basis.

~~Index~~

How We Assess the Performance of Our Business

We manage operations through the ~~three~~two business segments described above. In addition to our consolidated GAAP financial measures, we review various non-GAAP financial measures, including ~~“Adjusted~~Adjusted EBITDA,~~” “Adjusted~~ Adjusted Net ~~Income”~~Income and ~~“Free~~Free Cash Flow.”

We believe Adjusted EBITDA and Adjusted Net Income are helpful supplemental measures to assist us and investors in evaluating our operating results as they exclude certain items whose fluctuation from period to period do not necessarily correspond to changes in the operations of our business. Adjusted EBITDA represents net ~~loss~~income (loss) before interest, taxes, depreciation, amortization and certain non-cash, non-recurring and other adjustment items. We believe that the adjustments applied in presenting Adjusted EBITDA are appropriate to provide additional information to investors about certain material non-cash items and about non-recurring items that we do not expect to continue at the same level in the future. Adjusted Net Income is defined as net ~~loss~~income (loss) including interest, depreciation and amortization of non-acquisition related intangible assets and excluding other items used to calculate Adjusted EBITDA and further adjusted for the tax effect of these exclusions.

We use Free Cash Flow to review the liquidity of our operations. We measure Free Cash Flow as cash flows from operating activities less capital expenditures. We believe Free Cash Flow is a useful supplemental financial measure for us and investors in assessing our ability to pursue business opportunities and investments and to service our debt. Free Cash Flow is not a measure of our liquidity under GAAP and should not be considered as an alternative to cash flows from operating activities.

Management and our board of directors regularly use these measures as tools in evaluating our operating and financial performance and in establishing discretionary annual compensation. Such measures are provided in addition to, and should not be considered to be a substitute for, or superior to, the comparable measures under GAAP. In addition, we believe that Adjusted EBITDA, Adjusted Net Income and Free Cash Flow are frequently used by investors and other interested parties in the evaluation of issuers, many of which also present Adjusted EBITDA, Adjusted Net Income and Free Cash Flow when reporting their results in an effort to facilitate an understanding of their operating and financial results and liquidity.

Adjusted EBITDA, Adjusted Net Income and Free Cash Flow should not be considered as alternatives to net ~~loss~~income (loss) or any other performance measure derived in accordance with GAAP, or as alternatives to cash flow from operating activities as a measure of our liquidity. Adjusted EBITDA, Adjusted Net Income and Free Cash Flow have limitations as analytical tools, and you should not consider such measures either in isolation or as substitutes for analyzing our results as reported under GAAP.

Included in our discussion of our consolidated and segment results below are changes in revenues and Adjusted EBITDA on a Constant Currency basis. Constant Currency information compares results between periods as if exchange rates had remained constant period over period. We define Constant Currency revenues and Adjusted EBITDA as total revenues and Adjusted EBITDA excluding the impact of foreign exchange rate movements and use it to determine the Constant Currency revenue and Adjusted EBITDA growth on a year-over-year basis. Constant Currency revenues and Adjusted EBITDA are calculated by translating current period revenues and Adjusted EBITDA using corresponding prior period exchange rates. These results should be considered in addition to, not as a substitute for, results reported in accordance with GAAP. Results on a Constant Currency basis, as we present them, may not be comparable to similarly titled measures used by other companies and are not a measure of performance presented in accordance with GAAP. See ~~“Results of Operations—Non-GAAP~~“Non-GAAP Financial Measures” below for reconciliation information.

Results of Continuing Operations

Consolidated results should be read in conjunction with the segment results section herein and ~~the~~ Note 17 “Segment Results ~~note~~” to our unaudited condensed consolidated financial statements included elsewhere in this ~~report,~~Form 10-Q, which provides more detailed

Table of Content

discussions concerning certain components of our ~~consolidated statements~~Condensed Consolidated Statements of ~~operations.~~Operations. All intercompany accounts and transactions have been eliminated within the consolidated results.

~~Index~~

The following table presents selected ~~consolidated results~~Consolidated Results of ~~operations~~Operations of our business for the three ~~month~~ and ~~nine~~six month periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016:~~2020.


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,							For the Three Month Period Ended June 30,						For the Six Month Period Ended June 30,
	2017			2016			2017			2016				2021			2020			2021			2020
Condensed Consolidated Statement of Operations:													Condensed Consolidated Statement of Operations:
Revenues	$	649.6		$	462.6		$	1,710.4		$	1,361.6		Revenues	$	1,279.1		$	1,025.4		$	2,408.6		$	1,642.2
Cost of sales		395.7			298.4			1,066.0			867.1		Cost of sales	766.4			716.8			1,443.8			1,130.3
Gross profit		253.9			164.2			644.4			494.5		Gross profit	512.7			308.6			964.8			511.9
Selling and administrative expenses		111.1			100.9			339.1			310.3		Selling and administrative expenses	267.2			209.1			519.5			348.5
Amortization of intangible assets		29.5			30.7			87.6			90.8		Amortization of intangible assets	80.3			96.4			164.5			143.1
Impairment of other intangible assets		-			-			-			1.5

Other operating expense, net		17.4			12.4			186.7			26.1		Other operating expense, net	25.1			48.1			19.4			144.6
Operating income		95.9			20.2			31.0			65.8
Operating income (loss)													Operating income (loss)	140.1			(45.0)			261.4			(124.3)
Interest expense		30.1			43.0			115.4			128.7		Interest expense	22.7			30.8			45.8			57.9
Loss on extinguishment of debt		34.1			-			84.5			-		Loss on extinguishment of debt	—			—			—			2.0
Other income, net		(0.7	)		(0.7	)		(2.6	)		(2.6	)	Other income, net	(34.1)			(2.3)			(36.6)			(2.5)
Income (loss) before income taxes		32.4			(22.1	)		(166.3	)		(60.3	)	Income (loss) before income taxes	151.5			(73.5)			252.2			(181.7)
Provision (benefit) for income taxes		4.4			(9.1	)		(41.2	)		(33.3	)
Provision for income taxes													Provision for income taxes	12.5			78.4			23.1			11.5
Loss on equity method investments													Loss on equity method investments	(0.7)			—			(0.7)			—
Income (Loss) from Continuing Operations													Income (Loss) from Continuing Operations	138.3			(151.9)			228.4			(193.2)
Income (loss) from discontinued operations, net of tax													Income (loss) from discontinued operations, net of tax	96.3			(24.6)			(83.9)			(20.2)
Net income (loss)		28.0			(13.0	)		(125.1	)		(27.0	)	Net income (loss)	234.6			(176.5)			144.5			(213.4)
Less: Net (loss) income attributable to noncontrolling interest		-			(0.1	)		0.1			(0.6	)
Net income (loss) attributable to Gardner Denver Holdings, Inc.	$	28.0		$	(12.9	)	$	(125.2	)	$	(26.4	)
Less: Net income attributable to noncontrolling interests													Less: Net income attributable to noncontrolling interests	0.7			1.1			1.0			1.0
Net income (loss) attributable to Ingersoll Rand Inc.													Net income (loss) attributable to Ingersoll Rand Inc.	$	233.9		$	(177.6)		$	143.5		$	(214.4)

Percentage of Revenues:													Percentage of Revenues:
Gross profit		39.1	%		35.5	%		37.7	%		36.3	%	Gross profit	40.1		%	30.1		%	40.1		%	31.2		%
Selling and administrative expenses		17.1	%		21.8	%		19.8	%		22.8	%	Selling and administrative expenses	20.9		%	20.4		%	21.6		%	21.2		%
Operating income		14.8	%		4.4	%		1.8	%		4.8	%
Net income (loss)		4.3	%		(2.8	%)		(7.3	%)		(2.0	%)
Operating income (loss)													Operating income (loss)	11.0		%	(4.4)		%	10.9		%	(7.6)		%
Income (loss) from continuing operations													Income (loss) from continuing operations	10.8		%	(14.8)		%	9.5		%	(11.8)		%
Adjusted EBITDA		25.4	%		19.2	%		22.7	%		18.5	%	Adjusted EBITDA	22.8		%	21.2		%	22.3		%	20.1		%

Other Financial Data:													Other Financial Data:
Adjusted EBITDA⁽¹⁾		164.7			89.0			388.9			252.3		Adjusted EBITDA (1)	$	292.1		$	217.5		$	536.1		329.7
Adjusted Net Income ⁽¹⁾		85.2			23.3			149.2			67.2		Adjusted Net Income (1)	194.8			123.3			362.8			177.8
Cash flows - operating activities		63.9			37.8			83.9			106.8		Cash flows - operating activities	147.3			198.8			234.8			196.3
Cash flows - investing activities		(2.4	)		(34.0	)		(43.1	)		(59.8	)	Cash flows - investing activities	(25.0)			(14.3)			(232.2)			20.0
Cash flows - financing activities		(9.1	)		(8.3	)		(8.2	)		(30.8	)	Cash flows - financing activities	(2.3)			378.8			(10.1)			336.9
Free Cash Flow⁽¹⁾		54.3			17.5			47.5			60.5		Free Cash Flow (1)	135.7			183.2			208.9			173.6

⁽¹⁾

~~See the “Non-GAAP Financial Measures” section included in this Quarterly Report for a reconciliation to the nearest GAAP measure.~~

(1)See the “Non-GAAP Financial Measures” section for a reconciliation to comparable GAAP measure.

Revenues

Revenues for the three month period ended ~~September~~June 30, ~~2017~~2021 were ~~$649.6~~$1,279.1 million, an increase of ~~$187.0~~$253.7 million, or ~~40.4%~~24.7%, compared to ~~$462.6~~$1,025.4 million for the same three month period in ~~2016.~~2020. The increase in revenues was primarily due ~~primarily~~ to higher ~~revenue from upstream energy exposed markets (27.3% or $126.1 million), higher volume in other markets in our Energy segment as well as in our Industrials segment including acquisitions and net~~

Table of ~~divestitures (9.9% or $45.6 million), by the~~Content

organic volumes of $132.0 million, favorable impact of foreign currencies ~~(2.5% or $11.4 million),~~of $62.9 million and ~~improved~~higher pricing of $31.7 million. Organic volume growth included the adverse impact of COVID-19 in other markets in our Energy segment as well as in our Industrials and Medical segments (1.1% or $5.0 million), partially offset by lower volume including acquisitions in our Medical segment (0.2% or $1.1 million).the three month period ended June 30, 2020. The percentage of consolidated revenues derived from aftermarket parts and services was ~~40.5%~~35.7% in the three month period ended ~~September~~June 30, ~~2017~~2021 compared to ~~37.6%~~34.6% in the same three month period in ~~2016.~~

2020.

Revenues for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 were ~~$1,710.4~~$2,408.6 million, an increase of ~~$348.8~~$766.4 million, or ~~25.6%~~46.7%, compared to ~~$1,361.6~~$1,642.2 million for the same ~~nine~~six month period in ~~2016.~~2020. The increase in revenues was primarily due ~~primarily~~ to acquisitions of $448.3 million, higher ~~revenues from upstream energy exposed markets (22.6% or $308.0 million), higher volume in other markets in our Energy segment as well as in our Industrials segment including acquisitions and net~~organic volumes of ~~divestitures (2.4% or $32.6 million), and improved pricing (0.9% or $12.6 million), partially offset by the unfavorable~~$179.7 million, favorable impact of foreign currencies ~~(0.2% or $2.9 million),~~of $92.4 million and ~~lower~~higher pricing of $46.0 million. Organic volume ~~including acquisitions~~growth included the adverse impact of COVID-19 in ~~our Medical segment (0.1% or $1.5 million).~~the six month period ended June 30, 2020. The percentage of consolidated revenues derived from aftermarket parts and services was ~~42.1%~~36.5% in the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 compared to ~~34.9%~~34.6% in the same ~~nine~~six month period in ~~2016.~~

~~Index~~

2020.

Gross Profit

Gross profit for the three month period ended ~~September~~June 30, ~~2017~~2021 was ~~$253.9~~$512.7 million, an increase of ~~$89.7~~$204.1 million, or ~~54.6%~~66.1%, compared to ~~$164.2~~$308.6 million for the same three month period in ~~2016,~~2020, and as a percentage of revenues was ~~39.1%~~40.1% for the three month period ended ~~September~~June 30, ~~2017~~2021 and ~~35.5%~~30.1% for the same three month period in ~~2016.~~2020. The increase ~~reflects~~in gross profit is primarily due to higher organic volumes discussed above. The increase in gross profit as a percentage of revenues is due to the runoff of the fair valuation adjustments related to purchase price allocation from ~~upstream energy exposed markets, higher volume~~inventory into cost of sales in ~~other markets~~the 2020 period that did not recur in our Energy segment as well as in our Industrials segment including acquisitions and net of divestitures, improved pricing in our Industrials, Energy and Medical segments, and by favorable impact of foreign currencies, partially offset by lower volume including acquisitions in our Medical segment.

the 2021 period.

Gross profit for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 was ~~$644.4~~$964.8 million, an increase of ~~$149.9~~$452.9 million, or ~~30.3%~~88.5%, compared to ~~$494.5~~$511.9 million infor the same ~~nine~~six month period in ~~2016,~~2020, and as a percentage of revenues was ~~37.7%~~40.1% for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 and ~~36.3%~~31.2% for the same ~~nine~~six month period in ~~2016.~~2020. The increase ~~reflects higher~~in gross profit is primarily due to acquisitions, including Ingersoll Rand Industrial, and the runoff of the fair valuation adjustments related to purchase price allocation from inventory into cost of sales in the 2020 period that did not recur in the 2021 period. The increase in gross profit as a percentage of revenues is primarily due to the runoff of the fair valuation adjustments related to purchase price allocation from ~~upstream energy exposed markets, higher volume~~inventory into cost of sales in ~~other markets~~the 2020 period that did not recur in ~~our Energy segment as well as in our Industrials segment including acquisitions, improved pricing in our Industrials and Medical segments, partially offset by~~ the ~~unfavorable impact of foreign currencies, lower volume in our Medical segment including acquisitions, and lower pricing in other markets in our Energy segment.~~

2021 period.

Selling and Administrative Expenses

Selling and administrative expenses were ~~$111.1~~$267.2 million for the three month period ended ~~September~~June 30, ~~2017,~~2021, an increase of ~~$10.2~~$58.1 million, or ~~10.1%~~27.8%, compared to ~~$100.9~~$209.1 million for the same three month period in ~~2016.~~2020. Selling and administrative expenses as a percentage of revenues ~~decreased~~increased to ~~17.1%~~20.9% for the three month period ended ~~September~~June 30, ~~2017~~2021 from ~~21.8%~~20.4% in the same three month period in ~~2016.~~2020. The increase in selling and administrative expenses is primarily ~~reflects higher salary and other employee related costs, and professional and consulting fees, partially offset by a decline in Sponsor fees.~~

due to increased incentive compensation.

Selling and administrative expenses were ~~$339.1~~$519.5 million for the ~~nine~~six month period ended ~~September~~June 30, ~~2017,~~2021, an increase of ~~$28.8~~$171.0 million, or ~~9.3%~~49.1%, compared to ~~$310.3~~$348.5 million for the same ~~nine~~six month period in ~~2016.~~2020. Selling and administrative expenses as a percentage of revenues ~~decreased~~increased to ~~19.8%~~21.6% for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 from ~~22.8%~~21.2% in the same ~~nine~~six month period in ~~2016.~~2020. The increase in selling and administrative expenses is primarily ~~reflect a sponsor monitoring termination fee, expenses related~~due to ~~our initial public offering, higher professional~~acquisitions, including Ingersoll Rand Industrial and consulting fees, higher salary and other employee costs, partially offset by lower facilities operating expenses. Excluding Sponsor fees and initial public offering expenses, selling and administrative expenses as a percentage of revenues decreased to 18.6% for the nine month period ended September 30, 2017 from 22.5% in the same nine month period in 2016.

increased incentive compensation.

Amortization of Intangible Assets

Amortization of intangible assets was ~~$29.5~~$80.3 million for the three month period ended ~~September~~June 30, ~~2017 and $30.7 million for the three month period ended September 30, 2016. The decrease was primarily due to changes in foreign currencies.~~

~~Amortization of intangible assets was $87.6 million for the nine month period ended September 30, 2017,~~2021, a decrease of ~~$3.2~~$16.1 million, compared to ~~$90.8 million in the same nine month period in 2016. The decrease was primarily due to changes in foreign currencies and intangibles which became fully amortized in 2016.~~

~~Other Operating Expense, Net~~

~~Other operating expense, net for the three month period ended September 30, 2017 was $17.4 million, an increase of $5.0 million, compared to $12.4~~$96.4 million in the same three month period in ~~2016.~~2020. The decrease was primarily due to certain intangible assets, primarily backlog, related to the acquisition of Ingersoll Rand Industrial becoming fully amortized during the period.

Amortization of intangible assets was $164.5 million for the six month period ended June 30, 2021, an increase of $21.4 million, compared to $143.1 million in the same six month period in 2020. The increase was primarily due to the ~~recognition~~amortization of ~~stock-based compensation expense for stock options and deferred stock units ($9.8 million),~~intangible assets related to the acquisition of Ingersoll Rand Industrial, partially offset by ~~lower employee severance costs ($4.7 million).~~certain intangible assets, primarily backlog, also related to the acquisition of Ingersoll Rand Industrial becoming fully amortized during the period.

Other Operating Expense, Net

Other operating expense, net ~~for the nine month period ended September 30, 2017~~ was ~~$186.7~~$25.1 million an increase of $160.6 million, compared to $26.1 million in the same nine month period in 2016. The increase was primarily due to the recognition of stock-based compensation expense for stock options and deferred stock units ($166.0 million), a portion of which ($156.2 million) was related to our initial public offering, an increase in foreign currency losses (gains), net ($8.9 million), and a charge for environmental remediation expense ($0.9 million) partially offset by a decrease in restructuring charges, net ($10.5 million).

~~Index~~

~~Interest Expense~~

~~Interest expense~~ for the three month period ended ~~September~~June 30, ~~2017 was $30.1 million,~~2021, a decrease of ~~$12.9~~$23.0 million, compared to ~~$43.0~~$48.1 million in the same three month period in ~~2016.~~2020. The decrease was primarily due to ~~reduced debt as a result~~lower restructuring charges

Table of ~~debt payments made with the proceeds from the Company’s initial public offering,~~Content

of $22.6 million and ~~a flat weighted-average interest rate~~lower foreign currency transaction losses, net of ~~approximately 6.0% in 2017~~$1.5 million, partially offset by higher acquisition and ~~2016.~~other transaction related expenses and non-cash charges of $2.5 million.

~~Interest~~Other operating expense, net was $19.4 million for the ~~nine~~six month period ended ~~September~~June 30, ~~2017 was $115.4 million,~~2021, a decrease of ~~$13.3~~$125.2 million, compared to ~~$128.7~~$144.6 million in the same ~~nine~~six month period in ~~2016.~~2020. The decrease was primarily due to ~~reduced debt as~~lower restructuring charges of $58.2 million, lower acquisition and other transaction related expenses and non-cash charges of $44.2 million, and higher foreign currency transaction gains, net of $21.6 million.

Interest Expense

Interest expense was $22.7 million for the three month period ended June 30, 2021, a ~~result~~decrease of $8.1 million, compared to $30.8 million in the same three month period in 2020. The decrease was primarily due to a decrease in the weighted-average interest rate. The weighted average interest rate was approximately 2.0% for the three month period ended June 30, 2021 and 3.4% in the same period in 2020.

Interest expense was $45.8 million for the six month period ended June 30, 2021, a decrease of $12.1 million, compared to $57.9 million in the same six month period in 2020. The decrease was primarily due to the weighted average interest rate decreasing to approximately 2.0% for the six month period ended June 30, 2021 when compared to 4.2% in the same period in 2020.

Loss on Extinguishment of Debt

Loss on extinguishment of debt ~~payments made with~~was $2.0 million for the ~~proceeds from~~six month period ended June 30, 2020, which was related to the ~~Company’s initial public offering, partially offset by a higher weighted-average interest rate~~refinancing of ~~approximately 6.2% in 2017 compared to 6.0% in 2016.~~

the Original Dollar Term Loan and the Original Euro Term Loan.

Other Income, Net

Other income, net was ~~$0.7~~$34.1 million and $2.3 million in the three month ~~period~~periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016, respectively, consisting~~2020, respectively. The increase was primarily ~~of investment income and realized and unrealized gains and losses~~due to a gain on ~~investments.~~

post close settlements.

Other income, net was ~~$2.6~~$36.6 million and $2.5 million in the ~~nine~~six month ~~period~~periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016, respectively, consisting~~2020, respectively. The increase was primarily ~~of investment income and realized and unrealized gains and losses~~due to a gain on ~~investments.~~

post close settlements.

Provision ~~(Benefit)~~ for Income Taxes

The provision for income taxes was ~~$4.4~~$12.5 million resulting in a ~~13.6%~~8.3% effective income tax provision rate for the three month period ended ~~September~~June 30, ~~2017,~~2021, compared to a ~~benefit~~provision for income taxes of ~~$9.1~~$78.4 million resulting in a ~~41.3%~~(106.7)% effective income tax ~~benefit~~provision rate in the same three month period in ~~2016.~~2020. The ~~increase~~decrease in the tax provision for ~~income taxes~~the three month period ended June 30, 2021 is primarily due to the ~~increase~~benefits in ~~pre-tax income.~~ 2021 associated with the final settlement on the merger transaction and a restructuring benefit recognized during this quarter.

The ~~decrease~~provision for income taxes was $23.1 million resulting in ~~the~~a 9.2% effective income tax provision rate for the six month period ended June 30, 2021, compared to a provision for income taxes of $11.5 million resulting in a (6.3)% effective income tax provision rate in the same six month period in 2020. The increase in the tax provision for the six month period ended June 30, 2021 is primarily due to ~~the decrease in the U.S. loss at a higher tax rate combined with~~ an increase in ~~foreign profits at a~~the pretax book income in jurisdictions with higher effective tax rates combined with decreased earnings in jurisdictions with lower tax ~~rate.~~

~~The benefit for income taxes~~rates. This rate increase was ~~$41.2 million resulting in~~mitigated by a ~~24.8% effective income benefit~~reduction of unrecognized tax ~~rate for~~reserves as a result of the ~~nine month period ended September 30, 2017, compared to~~lapse of the limitation on statues, a benefit for income taxes of $33.3 million resulting in a 55.2% effective income tax benefit rate in the same nine month period in 2016. The decrease in the provision for income taxes is due to the increase of the pre-tax loss. The significant loss in the U.S. was caused by one-time expenses associated with the ~~Company’s initial public offering. This included offering-related expenses, early termination fees relating to~~final settlement on the ~~pay down of debt,~~merger transaction, and ~~stock-based compensation expense. The decrease in the effective income tax rate is primarily due to these expenses being benefited at~~ a ~~lower tax rate.~~

restructuring benefit recognized during this quarter.

Net Income (Loss)

~~The net~~Net income was ~~$28.0~~$234.6 million for the three month period ended ~~September~~June 30, ~~2017~~2021 compared to a net loss of ~~$13.0~~$176.5 million in the same three month period in ~~2016.~~2020. The increase in net income was primarily due to ~~higher operating income~~the gain on sale (see “―Results of Discontinued Operations” below), higher ~~revenues,~~ gross profit on increased revenues, increased other income, net, decreased other

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operating expenses, net, lower amortization of intangible assets, and lower interest expense, partially offset by ~~stock-based compensation expense~~higher selling and ~~loss on extinguishment of debt.~~administrative expenses.

~~The net loss~~Net income was ~~$125.1~~$144.5 million for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 compared to a net loss of ~~$27.0~~$213.4 million in the same ~~nine~~six month period in ~~2016.~~2020. The ~~increased~~change in net ~~loss~~income (loss) was primarily due to higher gross profit on increased revenues, the gain on sale (see “―Results of Discontinued Operations” below), decreased other operating expenses, ~~associated with the initial public offering, stock-based compensation~~net, increased other income, net, and lower interest expense, ~~and loss on the extinguishment of debt,~~ partially offset by higher ~~revenues~~selling and ~~gross profit.~~

administrative expenses and higher amortization.

Adjusted EBITDA

Adjusted EBITDA increased ~~$75.7~~$74.6 million to ~~$164.7~~$292.1 million for the three month period ended ~~September~~June 30, ~~2017~~2021 compared to ~~$89.0~~$217.5 million in the same three month period in ~~2016.~~2020. Adjusted EBITDA as a percentage of revenues increased ~~620~~160 basis points to ~~25.4%~~22.8% for the three month period ended ~~September~~June 30, ~~2017~~2021 from ~~19.2%~~21.2% for the same three month period in ~~2016.~~2020. The increase in Adjusted EBITDA was primarily due to higher organic sales volume ~~in our Energy segment~~of $50.7 million, higher pricing of $31.7 million and ~~Industrials segment including acquisitions and net of divestitures of ($80.9 million), improved pricing ($9.8 million), and the~~ favorable impact of foreign currencies ~~($3.3 million),~~of $16.4 million, partially offset by higher selling and administrative ~~costs ($11.3 million), higher material~~expenses of $41.8 million. The increase in Adjusted EBITDA as a percentage of revenues is primarily attributable to productivity related actions implemented subsequent to the acquisition of Ingersoll Rand Industrial including procurement initiatives, Innovate 2 Value (“I2V”) initiatives and ~~other manufacturing costs ($5.8 million)~~structural selling and ~~lower volume including acquisitions in our Medical segment ($1.2 million).~~

~~Index~~

administrative cost actions.

Adjusted EBITDA increased ~~$136.6~~$206.4 million to ~~$388.9~~$536.1 million for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 compared to ~~$252.3~~$329.7 million in the same ~~nine~~six month period in ~~2016.~~2020. Adjusted EBITDA as a percentage of revenues increased ~~420~~220 basis points to ~~22.7%~~22.3% for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 from ~~18.5%~~20.1% for the same ~~nine~~six month period in ~~2016.~~2020. The increase in Adjusted EBITDA was primarily due to acquisitions, including Ingersoll Rand Industrial, of $105.7 million, higher organic sales volume ~~in our Energy segment~~of $69.8 million, higher pricing of $46.0 million and ~~Industrials segment including acquisitions and net~~favorable impact of ~~divestitures ($135.1 million), lower material and other manufacturing costs ($2.6 million), and improved pricing ($15.9 million),~~foreign currencies of $23.9 million, partially offset by higher selling and ~~administration~~administrative expenses ~~($13.7 million), lower volume~~of $51.8 million. The increase in Adjusted EBITDA as a percentage of revenues is primarily attributable to productivity related actions implemented subsequent to the acquisition of Ingersoll Rand Industrial including ~~acquisitions in our Medical segment ($2.6 million),~~procurement initiatives, I2V initiatives and ~~the unfavorable impact of foreign currencies ($0.7 million).~~

structural selling and administrative cost actions.

Adjusted Net Income

Adjusted Net Income increased ~~$61.9~~$71.5 million to ~~$85.2~~$194.8 million for the three month period ended ~~September~~June 30, ~~2017,~~2021 compared to ~~$23.3~~$123.3 million in the same three month period in ~~2016.~~2020. The increase was primarily due to increased Adjusted EBITDA and lower interest expense , partially offset by an increased income tax provision, as adjusted.

Adjusted Net Income increased $185.0 million to $362.8 million for the six month period ended June 30, 2021 compared to $177.8 million in the same six month period in 2020. The increase was primarily due to increased Adjusted EBITDA and lower interest expense, partially offset by an ~~increase in the~~increased income tax provision, as adjusted.

Adjusted Net Income increased $82.0 million to $149.2 million for the nine month period ended September 30, 2017 compared to $67.2 million in the same nine month period in 2016. The increase was primarily due to increased Adjusted EBITDA and lower interest expense, partially offset by an increase in the income tax provision, as adjusted.

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Non-GAAP Financial Measures

Set forth below are the reconciliations of Net Income (Loss) to Adjusted EBITDA and Adjusted Net Income and Cash Flows from Operating Activities to Free Cash ~~Flow:~~Flow.

For the Three
Months Ended
September 30,

For the Nine
Months Ended
September 30,

2017 2016 2017 2016
Net Income (Loss) ⁽¹⁾
$ 28.0 $ (13.0 ) $ (125.1 ) $ (27.0 )
Plus:
Interest expense 30.1 43.0 115.4 128.7
Provision (benefit) for income taxes 4.4 (9.1 ) (41.2 ) (33.3 )
Depreciation expense 13.9 12.2 39.3 36.1
Amortization expense (a) 29.5 30.7 87.6 90.8
Impairment of goodwill and other intangible assets (b) - - - 1.5
Sponsor fees and expenses (c) - 1.8 17.3 3.8
Restructuring and related business transformation costs (d) 6.3 18.2 20.5 46.2
Acquisition related expenses and non-cash charges (e) 1.2 1.9 3.1 3.6
Environmental remediation loss reserve (f) - - 0.9 -
Expenses related to initial stock offering (g) 0.5 - 3.6 -
Establish public company financial reporting compliance (h) 3.8 0.1 7.2 0.1
Stock-based compensation (i) 9.8 - 166.0 -
Loss on extinguishment of debt (j) 34.1 - 84.5 -
Other adjustments (k) 3.1 3.2 9.8 1.8
Adjusted EBITDA $ 164.7 $ 89.0 $ 388.9 $ 252.3
Minus:
Interest expense 30.1 43.0 115.4 128.7
Income tax provision, as adjusted (l) 33.3 7.4 77.8 12.7
Depreciation expense 13.9 12.2 39.3 36.1
Amortization of non-acquisition related intangible assets 2.2 3.1 7.2 7.6
Adjusted Net Income $ 85.2 $ 23.3 $ 149.2 $ 67.2
Free Cash Flow
Cash flows - operating activities 63.9 37.8 83.9 106.8
Minus:
Capital expenditures 9.6 20.3 36.4 46.3
Free Cash Flow $ 54.3 $ 17.5 $ 47.5 $ 60.5


	For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
	2021		2020		2021		2020
Net Income (Loss)	$	234.6	$	(176.5)	$	144.5	$	(213.4)
Less: Income (loss) from discontinued operations	258.5		(7.2)		80.7		5.3
Less: Income tax provision from discontinued operations	(162.2)		(17.4)		(164.6)		(25.5)
Income (loss) from continuing operations, net of tax	138.3		(151.9)		228.4		(193.2)
Plus:
Interest expense	22.7		30.8		45.8		57.9
Provision for income taxes	12.5		78.4		23.1		11.5
Depreciation expense (a)	21.0		22.5		41.3		34.8
Amortization expense (b)	80.3		96.4		164.5		143.1

Restructuring and related business transformation costs (c)	6.7		31.0		9.4		69.6
Acquisition related expenses and non-cash charges (d)	14.3		90.3		24.8		179.8
Stock-based compensation (e)	21.5		12.1		43.1		14.9
Foreign currency transaction losses (gains), net	3.4		4.9		(14.7)		6.9
Loss on equity method investments	0.7		—		0.7		—
Loss on extinguishment of debt (f)	—		—		—		2.0
Gain on settlement of post-acquisition contingencies (g)	(30.1)		—		(30.1)		—
Other adjustments (h)	0.8		3.0		(0.2)		2.4
Adjusted EBITDA	$	292.1	$	217.5	$	536.1	$	329.7
Minus:
Interest expense	$	22.7	$	30.8	$	45.8	$	57.9
Income tax provision, as adjusted (i)	49.6		38.5		77.6		56.1
Depreciation expense	21.0		22.5		41.3		34.8
Amortization of non-acquisition related intangible assets	4.0		2.4		8.6		3.1
Adjusted Income from Continuing Operations, Net of Tax	$	194.8	$	123.3	$	362.8	$	177.8
Free Cash Flow from Continuing Operations:
Cash flows - operating activities	$	147.3	$	198.8	$	234.8	$	196.3
Minus:
Capital expenditures	11.6		15.6		25.9		22.7
Free Cash Flow from Continuing Operations	$	135.7	$	183.2	$	208.9	$	173.6

⁽¹⁾

In the fourth quarter of fiscal year 2016, the Company modified its methodology for presenting reconciling items from Net Income (Loss). The reconciling items for the three month and nine month periods ended September 30, 2016 have been reclassified to conform to the methodology used in the three month and nine month periods ended September 30, 2017, and include the following:

(a)Depreciation expense excludes $1.0 million and $0.4 million of depreciation of rental equipment for the three month periods ended June 30, 2021 and 2020, respectively, and excludes $2.0 million and $0.9 million for the six month periods ended June 30, 2021 and 2020.

(b)Represents $76.3 million and $94.0 million of amortization of intangible assets arising from the acquisition of Ingersoll Rand Industrial and other acquisitions (customer relationships, technology, tradenames and backlog) and $4.0 million and $2.4 million of amortization of non-acquisition related intangible assets, in each case for the three month periods ended June 30, 2021 and 2020, respectively.

Represents $155.9 million and $140.0 million of amortization of intangible assets arising from the acquisition of Ingersoll Rand Industrial and other acquisitions (customer relationships, technology, tradenames and backlog) and $8.6 million and $3.1 million of amortization of non-acquisition related intangible assets, in each case for the six month periods ended June 30, 2021 and 2020, respectively.

~~Index~~49

~~(a)~~

Represents $27.3 million and $27.6 million of amortization of intangible assets arising from the KKR transaction and other acquisitions (customer relationships and trademarks) and $2.2 million and $3.1 million of amortization of non-acquisition related intangible assets, in each case for the three month periods ended September 30, 2017 and 2016, respectively. Represents $80.4 million and $83.2 million of amortization of intangible assets arising from the KKR transaction and other acquisitions (customer relationships and trademarks) and $7.2 million and $7.6 million of amortization of non-acquisition related intangible assets, in each case for the nine month periods ended September 30, 2017 and 2016, respectively.

~~(b)~~

~~Represents non-cash charges for impairment of goodwill and other intangible assets.~~

~~(c)~~

~~Represents management fees and expenses paid to KKR, including a monitoring agreement termination fee of $16.2 million paid in the nine month period ended September 30, 2017.~~

~~(d)~~

~~Restructuring and related business transformation costs consist of the following:~~

For the Three
Months Ended
September 30,

For the Nine
Months Ended
September 30,

2017 2016 2017 2016

Restructuring charges $ 2.8 $ 3.0 $ 4.9 $ 15.4
Severance, sign-on, relocation and executive search costs 0.6 5.7 2.2 12.7
Facility reorganization, relocation and other costs 1.0 2.9 3.9 6.5
Information technology infrastructure transformation 0.8 0.6 3.4 1.0
(Gains) losses on asset and business disposals (0.6 ) 1.7 2.0 1.6
Consultant and other advisor fees 0.5 3.2 1.7 6.9
Other, net 1.2 1.1 2.4 2.1
Total restructuring and related business transformation costs $ 6.3 $ 18.2 $ 20.5 $ 46.2

~~(e)~~

Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs and non-cash charges and credits arising from fair value purchase accounting adjustments.

~~(f)~~

~~Represents estimated environmental remediation costs and losses relating to a former production facility.~~

~~(g)~~

~~Represents expenses related to the Company’s initial stock offering.~~

~~(h)~~

Represents third party expenses to comply with the requirements of Sarbanes-Oxley in 2018 and the accelerated adoption of the new revenue recognition standard (ASC 606 - Revenue from Contracts with Customers) in the first quarter of 2018, one year ahead of the required adoption date for a private company. These expenses were previously included in ‘Expenses related to initial stock offering’ and prior periods have been restated to conform to current period presentation.

~~(i)~~

Represents stock-based compensation expense recognized for stock options outstanding for the three months and nine months ended September 30, 2017 of $7.8 million and $69.2 million, respectively, and DSUs granted to employees at the date of the initial public offering for the three months and nine months ended September 30, 2017 of $2.0 million and $96.8 million, respectively. See Note 9 “Stock-Based Compensation”.

~~(j)~~

Represents losses on extinguishment of debt recognized on the redemption of the senior notes and pay down of a portion of the Original Dollar Term Loan Facility with proceeds from the initial public offering in May 2017 ($50.4 million) and in connection with the refinancing of the Original Dollar Term Loan Facility and Euro Term Loan Facility in August 2017 ($34.1 million).

~~(k)~~

Includes (i) foreign exchange gains and losses, (ii) effects of amortization of prior service costs and amortization of gains in pension and other postemployment benefits (OPEB) expense, (iii) certain legal and compliance costs, and (iv) other miscellaneous adjustments.

~~Index~~Table of Content

~~(l)~~

Represents the Company’s income tax provision adjusted for the tax effect of pre-tax items excluded from Adjusted Net Income and the removal of the applicable discrete tax items. The tax effect of pre-tax items excluded from Adjusted Net Income is computed using the statutory tax rate related to the jurisdiction that was impacted by the adjustment after taking into account the impact of permanent differences and valuation allowances. Discrete tax items include changes in tax laws or rates, changes in uncertain tax positions relating to prior years and changes in valuation allowances.

(c)Restructuring and related business transformation costs consisted of the following.


	For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
	2021		2020		2021		2020
Restructuring charges	$	6.8	$	29.4	$	9.2	$	67.4
Facility reorganization, relocation and other costs	—		0.1		—		0.5
Other, net	(0.1)		1.5		0.2		1.7
Total restructuring and related business transformation costs	$	6.7	$	31.0	$	9.4	$	69.6

For the Three
Months Ended
September 30,

For the Nine
Months Ended
September 30,

2017 2016 2017 2016
Provision (Benefit) for income taxes $ 4.4 $ (9.1 ) $ (41.2 ) $ (33.3 )
Tax impact of pre-tax income adjustments 30.3 16.4 119.0 43.9
Discrete tax items (1.4 ) 0.1 - 2.1
Income tax provision, as adjusted $ 33.3 $ 7.4 $ 77.8 $ 12.7

(d)Represents costs associated with successful and/or abandoned acquisitions and divestitures, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs), and non-cash charges and credits arising from fair value purchase accounting adjustments.

(e)Represents stock-based compensation expense recognized for the three and six month periods ended June 30, 2021 of $21.5 million and $43.1 million.

Represents stock-based compensation expense recognized for the three and six month periods ended June 30, 2020 of $12.1 million and $15.4 million, decreased by $0.5 million for the six month period ended June 30, 2020 due to costs associated with employer taxes.

(f)Represents losses on extinguishment of a portion of the U.S. term loan and the amendment of the revolving credit facility.

(g)Represents a gain on settlement of post-acquisition contingencies outside of the measurement period related to adjustments to the transaction price for retirement plan funding and net working capital.

(h)Includes (i) effects of the amortization of prior service costs and amortization of losses in pension and other postemployment (“OPEB”) expense, (ii) certain legal and compliance costs and (iii) other miscellaneous adjustments.

(i)Represents our income tax provision adjusted for the tax effect of pre-tax items excluded from Adjusted Net Income and the removal of the applicable discrete tax items. The tax effect of pre-tax items excluded from Adjusted Income is computed using the statutory tax rate related to the jurisdiction that was impacted by the adjustment after taking into account the impact of permanent differences and valuation allowances. Discrete tax items include changes in tax laws or rates, changes in uncertain tax positions relating to prior years and changes in valuation allowances. The adjusted amounts are then used to calculate an adjusted provision for the quarter.

The income tax provision, as adjusted for each of the periods presented below consisted of the following.


	For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
	2021		2020		2021		2020
Provision for income taxes	$	12.5	$	78.4	$	23.1	$	11.5
Tax impact of pre-tax income adjustments	36.4		(39.5)		44.6		48.6
Discrete tax items	0.7		(0.4)		9.9		(4.0)
Income tax provision, as adjusted	$	49.6	$	38.5	$	77.6	$	56.1

Segment Results

We classify our ~~businesses~~business into ~~three~~two segments: ~~Industrials, Energy~~Industrial Technologies and ~~Medical.~~

Services and Precision and Science Technologies. Our Corporate operations ~~(as described below)~~ are not discussed separately as any results that had a significant impact on operating results are included in the ~~consolidated results~~“Results of Operations” discussion above.

We recast certain prior period amounts to conform to the way we are internally managed and how we monitor segment performance during the current fiscal year.

We evaluate the performance of our ~~Segments~~segments based on Segment Revenues and Segment Adjusted EBITDA. Segment Adjusted EBITDA is indicative of operational performance and ongoing profitability. Our management closely monitors Segment Adjusted EBITDA to evaluate past performance and identify actions required to improve profitability.

The ~~Segment~~segment measurements provided to and evaluated by the chief operating decision maker are described in Note ~~15 “Segment Results” in the “Notes~~17 “Segment Results” to ~~Condensed Consolidated Financial Statements”~~our unaudited condensed consolidated financial statements included elsewhere in this ~~Report.~~

Included in our discussion of our segment results below are changes in Segment Revenues and Segment Adjusted EBITDA on a Constant Currency basis. Constant Currency information compares results between periods as if exchange rates had remained constant period over period. We define Constant Currency as changes in Segment Revenues and Segment Adjusted EBITDA excluding the impact of foreign exchange rate movements. We use these measures to determine the Constant Currency Segment Revenues and Segment Adjusted EBITDA growth on a year-on-year basis. Constant Currency Segment Revenues and Segment Adjusted EBITDA are calculated by translating current period Segment Revenues and Segment Adjusted EBITDA using prior period exchange rates. These results should be considered in addition to, not as a substitute for, results reported in accordance with GAAP. Results on a constant currency basis, as we present them, may not be comparable to similarly titled measures used by other companies and are not a measure of performance presented in accordance with GAAP.

Form 10-Q.

Segment Results for the Three and ~~Nine~~Six Month Periods Ended ~~September~~June 30, ~~2017~~2021 and ~~2016~~

2020

The following tables display Segment Revenues, Segment Adjusted EBITDA and Segment Adjusted EBITDA Margin (Segment Adjusted EBITDA as a percentage of Segment Revenues) for each of our ~~Segments~~Segments.

Table of Content

Industrial Technologies and ~~illustrate, on a percentage basis, the impact of foreign currency fluctuations on Segment Revenues and Segment Adjusted EBITDA growth.~~

~~Industrials~~Services Segment Results

										Constant Currency Percent Change
	For the Three Months Ended September 30,						Percent Change			Constant Currency Percent Change				For the Three Month Period Ended June 30,						Percent Change
	2017			2016			2017 vs. 2016			2017 vs. 2016				2021			2020			2021 vs. 2020
Segment Revenues	$	288.2		$	265.6			8.5	%		5.9	%	Segment Revenues	$	1,047.5		$	829.6		26.3	%
Segment Adjusted EBITDA	$	63.1		$	55.6			13.5	%		10.1	%	Segment Adjusted EBITDA	$	258.6		$	183.8		40.7	%
Segment Margin		21.9	%		20.9	%							Segment Margin	24.7		%	22.2		%	250	bps

Segment Revenues for the three month period ended ~~September~~June 30, ~~2017~~2021 were ~~$288.2~~$1,047.5 million, an increase of ~~$22.6~~$217.9 million, or ~~8.5%~~26.3%, compared to ~~$265.6~~$829.6 million in the same three month period in ~~2016.~~2020. The increase in Segment Revenues was due to higher ~~volume including acquisitions and net~~organic volumes of ~~divestitures (4.5%~~$112.5 million or ~~12.0 million)~~13.6%, ~~the~~ favorable impact of foreign currencies ~~(2.6%~~of $52.6 million or ~~$6.9 million)~~6.3%, higher pricing of $28.1 million or 3.4%, and ~~higher pricing (1.4%~~acquisitions of $24.7 million or ~~$3.7 million)~~3.0%. ~~The percentage~~Organic volume growth included the adverse impact of ~~Segment Revenues derived from aftermarket parts and services was 33.4%~~COVID-19 in the three month period ended ~~September~~June 30, ~~2017 compared to 35.6% in the same three month period in 2016.~~

~~Index~~

Segment Adjusted EBITDA for the three month period ended September 30, 2017 was $63.1 million, an increase of $7.5 million, or 13.5%, compared to $55.6 million in the same three month period in 2016. Segment Adjusted EBITDA Margin increased 100 basis points to 21.9% from 20.9% in 2016. The increase in Segment Adjusted EBITDA was due primarily to higher volume including acquisitions and net of divestitures ($4.3 million), improved pricing ($3.7 million), the favorable impact of foreign currencies ($1.9 million), partially offset by higher material and other manufacturing costs ($2.2 million), and higher selling and administrative expense ($0.2 million).

Constant Currency
Percent Change

For the Nine Months Ended September 30, Percent Change
2017 2016 2017 vs. 2016 2017 vs. 2016
Segment Revenues $ 819.0 $ 803.6 1.9 % 2.3 %
Segment Adjusted EBITDA $ 173.7 $ 156.2 11.2 % 11.7 %
Segment Margin 21.2 % 19.4 %

Segment Revenues for the nine month period ended September 30, 2017 were $819.0 million, an increase of $15.4 million, or 1.9%, compared to $803.6 million in the same nine month period in 2016. The increase in Segment Revenues was due to improved pricing (1.4% or $11.4 million), and higher volume including acquisitions and net of divestitures (0.9% or $6.7 million), partially offset by the unfavorable impact of foreign currencies (0.4% or $2.7 million).2020. The percentage of Segment Revenues derived from aftermarket parts and service was ~~34.6%~~40.5% in ~~the nine month period ended September 30, 2017, compared to 35.0% in the same nine month period in 2016.~~

Segment Adjusted EBITDA for the nine month period ended September 30, 2017 was $173.7 million, an increase of $17.5 million, or 11.2%, compared to $156.2 million in the same nine month period in 2016. Segment Adjusted EBITDA Margin increased 180 basis points to 21.2% from 19.4% in 2016. The increase in Segment Adjusted EBITDA was due primarily to improved pricing ($11.4 million), lower material and other manufacturing costs ($4.8 million), higher volume including acquisitions and net of divestitures ($1.2 million), lower selling and administrative expense ($0.9 million), partially offset by the unfavorable impact of foreign currencies ($0.8 million).

~~Energy Segment Results~~

For the Three Months Ended September 30, Percent Change
Constant Currency
Percent Change

2017 2016 2017 vs. 2016 2017 vs. 2016
Segment Revenues $ 301.6 $ 137.9 118.7 % 115.9 %
Segment Adjusted EBITDA $ 98.6 $ 22.0 348.2 % 342.7 %
Segment Margin 32.7 % 16.0 %

~~Segment Revenues for~~ the three month period ended ~~September~~June 30, ~~2017 were $301.6 million, an increase of $163.7 million, or 118.7%,~~2021 compared to ~~$137.9 million~~39.5% in the same three month period in 2016. The increase in Segment Revenues was due to higher revenues from upstream energy exposed markets (91.4% or $126.1 million), higher volume in other markets of our Energy segment (24.4% or $33.6 million), the favorable impact of foreign currencies (2.5% or $3.4 million), and improved pricing in other markets of our Energy segment (0.4% or $0.6 million). The percentage of Segment Revenues derived from aftermarket parts and services was 54.7% in the three month period ended September 30, 2017 compared to 57.7% in the same three month period in 2016.

2020.

Segment Adjusted EBITDA for the three month period ended ~~September~~June 30, ~~2017~~2021 was ~~$98.6~~$258.6 million, an increase of ~~$76.6~~$74.8 million, or ~~348.2% compared to $22.0~~40.7%, from $183.8 million in the same three month period in ~~2016.~~2020. Segment Adjusted EBITDA Margin increased ~~1670~~250 basis points to ~~32.7%~~24.7% from ~~16.0%~~22.2% in ~~2016.~~2020. The increase in Segment Adjusted EBITDA was primarily due ~~primarily~~ to higher organic sales volume ~~($76.8 million)~~of $41.8 million or 22.7%, ~~, improved~~higher pricing ~~($5.3 million)~~of $28.1 million or 15.3%, ~~and the~~ favorable impact of foreign currencies ~~($1.3 million)~~of $13.8 million or 7.5%, productivity related procurement and I2V initiatives of $12.3 million or 6.7%, and acquisitions of $7.7 million or 4.2%, partially offset by higher ~~material and manufacturing costs ($4.1 million), and higher~~ selling and administrative ~~expense ($2.7 million)~~costs of $25.5 million or 13.9%.

~~Index~~

										Constant Currency Percent Change
	For the Nine Months Ended September 30,						Percent Change			Constant Currency Percent Change				For the Six Month Period Ended June 30,						Percent Change
	2017			2016			2017 vs. 2016			2017 vs. 2016				2021			2020			2021 vs. 2020
Segment Revenues	$	719.4		$	385.8			86.5	%		86.3	%	Segment Revenues	$	1,961.3		$	1,333.6		47.1	%
Segment Adjusted EBITDA	$	199.2		$	70.2			183.8	%		183.2	%	Segment Adjusted EBITDA	$	470.1		$	278.6		68.7	%
Segment Margin		27.7	%		18.2	%							Segment Margin	24.0		%	20.9		%	310	bps

Segment Revenues for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 were ~~$719.4~~$1,961.3 million, an increase of ~~$333.6~~$627.7 million, or ~~86.5%~~47.1%, compared to ~~$385.8 million~~$1,333.6 in the same ~~nine~~six month period in ~~2016.~~2020. The increase in Segment Revenues was primarily due to ~~higher revenues from upstream energy exposed markets (79.8%~~acquisitions, including of Ingersoll Rand Industrial, of $361.8 million or ~~$308.0 million)~~27.1%, higher organic volume ~~in other markets~~ of ~~our Energy segment (6.7%~~$148.2 million or ~~$25.8 million)~~11.1%, ~~the~~ favorable impact of foreign currencies ~~(0.2%~~of $77.0 million or ~~$0.4 million), partially offset by~~5.8% and higher pricing ~~(0.2%~~of $40.7 million or ~~$0.6 million)~~3.1%. Organic volume growth includeded the adverse impact of COVID-19 in the six month period ended June 30, 2020. The percentage of Segment Revenues derived from aftermarket parts and service was ~~59.9%~~41.2% in the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 compared to ~~50.3%~~39.6% in the same ~~nine~~six month period in ~~2016.~~

2020.

Segment Adjusted EBITDA for the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 was ~~$199.2~~$470.1 million, an increase of ~~$129.0~~$191.5 million, or ~~183.8%~~68.7%, ~~compared to $70.2~~from $278.6 million in the same ~~nine~~six month period in ~~2016.~~2020. Segment Adjusted EBITDA Margin increased ~~950 basis points~~310 bps to ~~27.7%~~24.0% from ~~18.2%~~20.9% in ~~2016.~~2020. The increase in Segment Adjusted EBITDA was primarily due ~~primarily~~ to acquisitions, including Ingersoll Rand Industrial, of $82.7 million or 29.7%, higher ~~volume ($134.0 million)~~organic sales volumes of $55.6 million or 20.0%, ~~improved~~higher pricing ~~($2.7 million)~~of $40.7 million or 14.6%, ~~and the~~ favorable impact of foreign currencies ~~($0.2 million)~~of $20.0 million or 7.2%, and productivity related procurement and I2V initiatives of $18.9 million or 6.8%, partially offset by higher ~~material and other manufacturing costs ($4.4 million) and higher~~ selling and administrative ~~expense ($3.5 million)~~costs of $22.7 million or 8.1%.

~~Medical~~Precision and Science Technologies Segment Results


	For the Three Month Period Ended June 30,						Percent Change
	2021			2020			2021 vs. 2020
Segment Revenues	$	231.6		$	195.8		18.3	%
Segment Adjusted EBITDA	$	71.1		$	59.3		19.9	%
Segment Margin	30.7		%	30.3		%	40	bps

Constant Currency
Percent Change

For the Three Months Ended September 30, Percent Change
2017 2016 2017 vs. 2016 2017 vs. 2016
Segment Revenues $ 59.8 $ 59.1 1.2 % (0.9 %)
Segment Adjusted EBITDA $ 16.8 $ 16.6 1.2 % (1.4 %)
Segment Margin 28.1 % 28.1 %

Table of Content

Segment Revenues for the three month period ended ~~September~~June 30, ~~2017~~2021 were ~~$59.8~~$231.6 million, an increase of ~~$0.7~~$35.8 million, or ~~1.2%~~18.3%, compared to ~~$59.1~~$195.8 million in the same three month period in ~~2016.~~2020. The increase in Segment Revenues was primarily due to ~~the~~higher organic volume of $19.5 million or 10.0%, favorable impact of foreign currencies ~~(1.7%~~of $10.3 million or ~~$1.0 million)~~5.3%, higher pricing of $3.6 million or 1.8%, and ~~improved pricing (1.3%~~acquisitions of $2.4 million or ~~$0.8 million), partially offset by lower~~1.2%. Organic volume ~~including acquisitions (1.8% or $1.1 million). The percentage~~growth included the adverse impact of ~~Segment Revenues derived from aftermarket parts and services was 3.3%~~COVID-19 in the three month period ended ~~September~~June 30, ~~2017 compared to 0.0% in the same three month period in 2016.~~

Segment Adjusted EBITDA for the three month period ended September 30, 2017 was $16.8 million, an increase of $0.2 million, or 1.2%, compared to $16.6 million in the same three month period in 2016. Segment Adjusted EBITDA Margin was 28.1%, flat with the same three month period in 2016. The increase in Segment Adjusted EBITDA was due primarily to improved pricing ($0.8 million), lower material and other manufacturing costs ($0.2 million), the favorable impact of foreign currencies ($0.3 million), and lower selling and administrative expense ($0.1 million), partially offset by lower volume including acquisitions ($1.2 million).

Constant Currency
Percent Change

For the Nine Months Ended September 30, Percent Change
2017 2016 2017 vs. 2016 2017 vs. 2016
Segment Revenues $ 172.0 $ 172.2 (0.1 %) 0.2 %
Segment Adjusted EBITDA $ 46.9 $ 44.7 4.9 % 5.1 %
Segment Margin 27.3 % 26.0 %

Segment Revenues for the nine month period ended September 30, 2017 were $172.0 million, a decrease of $0.2 million, or 0.1%, compared to $172.2 million in the same nine month period in 2016. The decrease in Segment Revenues was due to lower volume including acquisitions (0.8% or $1.5 million), and the unfavorable impact of foreign currencies (0.3% or $0.5 million), partially offset by improved pricing (1.1% or $1.8 million).2020. The percentage of Segment Revenues derived from aftermarket parts and service was ~~3.8%~~14.3% in the ~~nine~~three month period ended ~~September~~June 30, ~~2017~~2021 compared to ~~0.0%~~13.6% in the same ~~nine~~three month period in ~~2016.~~

2020.

Segment Adjusted EBITDA for the ~~nine~~three month period ended ~~September~~June 30, ~~2017~~2021 was ~~$46.9~~$71.1 million, an increase of ~~$2.2~~$11.8 million, or ~~4.9% compared to $44.7~~19.9%, from $59.3 million in the same ~~nine~~three month period in ~~2016.~~2020. Segment Adjusted EBITDA Margin increased ~~130~~40 basis points to ~~27.3%~~30.7% from ~~26.0%~~30.3% in ~~2016.~~2020. The increase in Segment Adjusted EBITDA was primarily due ~~primarily~~ to ~~improved~~higher organic sales volume of $8.9 million or 15.0%, favorable impact of foreign currencies of $3.6 million or 6.1%, higher pricing ~~($1.8 million), lower selling and administrative expense ($1.7 million)~~of $3.6 million or 6.1%, and ~~lower material and other manufacturing costs ($1.5 million)~~acquisitions of $0.6 million or 1.0%, partially offset by ~~lower~~higher selling and administrative costs of $2.6 million or 4.4%.


	For the Six Month Period Ended June 30,						Percent Change
	2021			2020			2021 vs. 2020
Segment Revenues	$	447.3		$	308.6		44.9	%
Segment Adjusted EBITDA	$	138.3		$	92.2		50.0	%
Segment Margin	30.9		%	29.9		%	100	bps

Segment Revenues for the six month period ended June 30, 2021 were $447.3 million, an increase of $138.7 million, or 44.9%, compared to $308.6 million in the same six month period in 2020. The increase in Segment Revenues was primarily due to acquisitions, including Ingersoll Rand Industrial, of $86.5 million or 28.0%, higher organic volume ~~including acquisitions ($2.6 million)~~of $31.5 million or 10.2%, ~~and the unfavorable~~favorable impact of foreign currencies ~~($0.2 million)~~of $15.4 million or 5.0% and higher pricing of $5.3 million or 1.7%. Organic volume growth included the adverse impact of COVID-19 in the six month period ended June 30, 2020. The percentage of Segment Revenues derived from aftermarket parts and service was 15.7% in the six month period ended June 30, 2021 compared to 13.1% in the same six month period in 2020.

Segment Adjusted EBITDA for the six month period ended June 30, 2021 was $138.3 million, an increase of $46.1 million, or 50.0%, from $92.2 million in the same six month period in 2020. Segment Adjusted EBITDA Margin increased 100 bps to 30.9% from 29.9% in 2020. The increase in Segment Adjusted EBITDA was primarily due to acquisitions, including Ingersoll Rand Industrial, of $25.0 million or 27.1%, higher organic sales volume of $14.2 million or 15.4%, favorable impact of foreign currencies of $5.5 million or 6.0% and higher pricing of $5.3 million or 5.7%, partially offset by higher selling and administrative costs of $2.1 million or 2.3%.

Table of Content

Results of Discontinued Operations

Results of Discontinued Operations - SVT

The following table presents selected Consolidated Results of Operations of our business for the three and six month periods ended June 30, 2021 and 2020.


	For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
	2021		2020		2021		2020
Revenues	$	184.0	$	217.5	$	424.3	$	304.2
Cost of sales	137.9		166.4		314.9		238.7
Gross profit	46.1		51.1		109.4		65.5
Selling and administrative expenses	16.9		18.2		35.3		26.0
Amortization of intangible assets	0.9		12.3		10.4		14.9
Gain on sale	(256.7)		—		(256.7)		—
Other operating expense, net	9.2		(0.1)		16.2		0.7




Income before income taxes	275.8		20.7		304.2		23.9
Provision for income taxes	162.8		29.2		169.7		30.0
Income (Loss) from Continuing Operations	$	113.0	$	(8.5)	$	134.5	$	(6.1)

Revenues

Revenues for the three month period ended June 30, 2021 were $184.0 million, a decrease of $33.5 million, or 15.4%, compared to $217.5 million in the same three month period in 2020. The decrease in revenues from discontinued operations was primarily due to the sale being substantially completed on June 1, 2021.

Revenues for the six month period ended June 30, 2021 were $424.3 million, an increase of $120.1 million, or 39.5%, compared to $304.2 million in the same six month period in 2020. The increase in revenues from discontinued operations was primarily due to five months of activity for the six month period ended June 30, 2021 compared to four months in the same six month period in 2020.

Gross Profit

Gross profit for the three month period ended June 30, 2021 was $46.1 million, a decrease of $5.0 million, or 9.8%, compared to $51.1 million for the same three month period in 2020, and as a percentage of revenues was 25.1% for the three month period ended June 30, 2021 and 23.5% for the same three month period in 2020. The decrease in gross profit is primarily due to the sale being substantially completed on June 1, 2021 described above.

Gross profit for the six month period ended June 30, 2021 was $109.4 million, an increase of $43.9 million, or 67.0%, compared to $65.5 million for the same six month period in 2020, and as a percentage of revenues was 25.8% for the six month period ended June 30, 2021 and 21.5% for the same six month period in 2020. The increase in gross profit is primarily due to five months of activity for the six month period ended June 30, 2021 compared to four months in the same six month period in 2020 described above.

Gain on Sale

Gain on sale for the three and six month periods ended June 30, 2021 of $256.7 million and was due to the purchase price exceeding the carrying value of the SVT business.

Other Operating Expense (Income), Net

Other operating expense (income), net was $9.2 million for the three month period ended June 30, 2021, an increase of $9.3 million, compared to $(0.1) million in the same three month period in 2020. The increase was primarily due to higher separation related expenses and non-cash charges of $9.2 million.

~~Index~~

Table of Content

Other operating expense, net was $16.2 million for the six month period ended June 30, 2021, an increase of $15.5 million, compared to $0.7 million in the same six month period in 2020. The increase was primarily due to higher separation related expenses and non-cash charges of $16.2 million, partially offset by lower restructuring charges of $0.7 million.

Provision (Benefit) for Income Taxes

The provision for income taxes was $162.8 million resulting in a 59.0% effective income tax rate for the three month period ended June 30, 2021, compared to a provision for income taxes of $29.2 million resulting in a 141.1% effective income tax rate in the same three month period in 2020. The increase in the tax provision for the three month period ended June 30, 2021 is primarily due to one-time discrete items associated with the sale of the SVT business.

The provision for income taxes was $169.7 million resulting in a 55.8% effective income tax rate for the six month period ended June 30, 2021, compared to a provision for income taxes of $30.0 million resulting in a 125.5% effective income tax rate in the same six month period in 2020. The increase in the tax provision for the six month period ended June 30, 2021 is primarily due to one-time discrete items associated with the sale of the SVT business.

Results of Discontinued Operations - HPS

The following table presents selected Consolidated Results of Operations of our business for the three and six month periods ended June 30, 2021 and 2020.


	For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
	2021		2020		2021		2020
Revenues	$	3.0	$	21.5	$	65.4	$	117.9
Cost of sales	3.9		21.2		54.4		90.8
Gross profit	(0.9)		0.3		11.0		27.1
Selling and administrative expenses	0.6		20.4		4.9		28.6
Amortization of intangible assets	—		5.9		2.4		11.8
Loss on sale	8.4		—		211.7		—
Other operating expense, net	7.4		1.9		15.5		5.3




Loss before income taxes	(17.3)		(27.9)		(223.5)		(18.6)
Benefit for income taxes	(0.6)		(11.8)		(5.1)		(4.5)
Income (Loss) from Continuing Operations	$	(16.7)	$	(16.1)	$	(218.4)	$	(14.1)

Revenues

Revenues for the three month period ended June 30, 2021 were $3.0 million, a decrease of $18.5 million, or 86.0%, compared to $21.5 million in the same three month period in 2020. The decrease in revenues from discontinued operations was primarily due to the sale of substantially all of the HPS business on April 1, 2021.

Revenues for the six month period ended June 30, 2021 were $65.4 million, a decrease of $52.5 million, or 44.5%, compared to $117.9 million in the same six month period in 2020. The decrease in revenues from discontinued operations was primarily due to three months of activity for the six month period ended June 30, 2021 compared to six months in the same six month period in 2020.

Gross Profit

Gross profit for the three month period ended June 30, 2021 was $(0.9) million, a decrease of $1.2 million, or 400.0%, compared to $0.3 million for the same three month period in 2020, and as a percentage of revenues was (30.0)% for the three month period ended June 30, 2021 and 1.4% for the same three month period in 2020. The decrease in gross profit is primarily due to the revenue decline described above.

Gross profit for the six month period ended June 30, 2021 was $11.0 million, a decrease of $16.1 million, or 59.4%, compared to $27.1 million for the same six month period in 2020, and as a percentage of revenues was 16.8% for the six month period ended

Table of Content

June 30, 2021 and 23.0% for the same six month period in 2020. The decrease in gross profit is primarily due to the revenue decline described above.

Loss on Sale

Loss on sale for the three month period ended June 30, 2021 of $8.4 million was a charge taken to reduce the carrying value of the HPS business to the estimated fair value of the net proceeds and residual equity interest from the transaction.

Loss on sale for the six month period ended June 30, 2021 of $211.7 million was a charge taken to reduce the carrying value of the HPS business to the estimated fair value of the net proceeds and residual equity interest from the transaction.

Other Operating Expense, Net

Other operating expense, net was $7.4 million for the three month period ended June 30, 2021, an increase of $5.5 million, compared to $1.9 million in the same three month period in 2020. The increase was primarily due to expenses incurred in connection with the separation of $7.0 million, partially offset by lower restructuring charges of $1.0 million.

Other operating expense, net was $15.5 million for the six month period ended June 30, 2021, an increase of $10.2 million, compared to $5.3 million in the same six month period in 2020. The increase was primarily due to expenses incurred in connection with the separation of $13.8 million, partially offset by lower restructuring charges of $3.5 million.

Provision (Benefit) for Income Taxes

The benefit for income taxes was $0.6 million resulting in a 3.5% effective income tax rate for the three month period ended June 30, 2021, compared to a benefit for income taxes of $11.8 million resulting in a 42.3% effective income tax rate in the same three month period in 2020. The increase in the tax provision for the three month period ended June 30, 2021 is primarily due to one-time discrete items associated with the sale of the HPS business.

The benefit for income taxes was $5.1 million resulting in a 2.3% effective income tax rate for the six month period ended June 30, 2021, compared to a benefit for income taxes of $4.5 million resulting in a 24.2% effective income tax rate in the same six month period in 2020. The decrease in the tax provision for the six month period ended June 30, 2021 is primarily due to one-time discrete items associated with the sale of the HPS business.

Liquidity and Capital Resources

Our ~~operations and strategic objectives require continuing investment. Our~~investment resources include cash on hand, cash generated from operations and borrowings under our Revolving Credit ~~Facility~~Facility. We also have the ability to seek additional secured and ~~the Receivables Financing Agreement. At September~~unsecured borrowings, subject to Credit Agreement restrictions.

As of June 30, ~~2017, the Company~~2021, we had ~~$8.0~~$84.1 million of outstanding letters of credit written against the Revolving Credit Facility and ~~$352.0~~$1,015.9 million of unused availability. The Company also had $33.2 million of letters of credit outstanding against the Receivables Financing Agreement and $82.1 million of unused availability. On June 30, 2017, we entered into the first amendment to the Receivables Financing Agreement which increased the aggregated borrowing capacity by $50.0 million to $125.0 million governed by a borrowing base and also extended the term to June 30, 2020.

See the description of these line-of-credit resources ~~as well as our outstanding debt obligations~~ in Note ~~8 “Debt”~~10 “Debt” to the ~~Condensed Consolidated Financial Statements.~~

consolidated financial statements in our annual report on Form 10-K for the fiscal year ended December 31, 2020 and Note 9 “Debt” to our unaudited condensed consolidated financial statements included elsewhere in this Form 10-Q.

As of ~~September~~June 30, ~~2017 and 2016, the Company was~~2021, we were in compliance with all of ~~its~~our debt covenants and no event of default had occurred or was ongoing.

Table of Content

Liquidity

A substantial portion of our liquidity needs arise from debt service requirements, and from the ongoing cost of operations, working capital and capital expenditures.


	September 30, 2017		December 31, 2016			June 30, 2021		December 31, 2020
Cash and cash equivalents	$	303.0	$	255.8	Cash and cash equivalents	$	3,669.9	$	1,750.9

Short-term borrowings and current maturities of long-term debt		21.1		24.5	Short-term borrowings and current maturities of long-term debt	$	40.7	$	40.4
Long-term debt		2,006.9		2,753.8	Long-term debt	3,823.3		3,859.1
Total debt	$	2,028.0	$	2,778.3	Total debt	$	3,864.0	$	3,899.5

We can increase the borrowing availability under the senior secured credit agreement that we and certain of our subsidiaries entered into with UBS AG, Stamford Branch, as administrative agent, and other agents and lenders party thereto on July 30, 2013, as amended by Amendment No. 1 on March 4, 2016 and Amendment No. 2 on August 17, 2017 (the “SeniorSenior Secured Credit ~~Facilities”),~~Facilities by up to ~~$250~~$1,600.0 million in the form of additional commitments under the ~~senior secured revolving credit facility (the “Revolving~~Revolving Credit ~~Facility”) thereunder~~Facility and/or incremental term loans plus an additional amount so long as we do not exceed a specified senior secured leverage ratio. We can incur additional secured indebtedness under the ~~senior secured~~ term loan facilities ~~under the Senior Secured Credit Facilities~~ if certain specified conditions are met under the credit agreement governing the Senior Secured Credit Facilities. Our liquidity requirements are significant primarily due to debt service requirements. ~~For a complete description of our credit facilities, refer to~~See Note 810 “Debt” ~~in the “Notes~~ to the ~~Condensed Consolidated Financial Statements.~~consolidated financial statements in our annual report on Form 10-K for the fiscal year ended December 31, 2020 and Note 9 “Debt”

to our unaudited condensed consolidated financial statements included elsewhere in this Form 10-Q for further details.

Our principal sources of liquidity have been existing cash and cash equivalents, cash generated from operations and borrowings under the Senior Secured Credit Facilities. Our principal uses of cash will be to provide working capital, meet debt service requirements, fund capital expenditures and finance strategic plans, including possible acquisitions. We may also seek to finance capital expenditures under capital leases or other debt arrangements that provide liquidity or favorable borrowing terms. We continue to consider acquisition opportunities, but the size and timing of any future acquisitions and the related potential capital requirements cannot be predicted. In the event that suitable businesses are available for acquisition upon acceptable terms, we may obtain all or a portion of the necessary financing through the incurrence of additional long-term borrowings. As market conditions warrant, we ~~and our major equity holders, including KKR and its affiliates,~~ may from time to time, seek to ~~repurchase debt securities that we have issued or~~repay loans that we have borrowed, including the ~~notes and~~ borrowings under the Senior Secured Credit ~~Facilities, in privately negotiated or open market transactions, by tender offer or otherwise.~~Facilities. Based on our current level of operations and available cash, we believe our cash flow from operations, together with availability under the Revolving Credit Facility, ~~and the Receivables Financing Agreement,~~ will provide sufficient liquidity to fund our current obligations, projected working capital requirements, debt service requirements and capital spending requirements for the foreseeable future. Our business may not generate sufficient cash flows from operations or future borrowings may not be available to us under our Revolving Credit Facility ~~or the Receivables Financing Agreement~~ in an amount sufficient to enable us to pay our indebtedness, or to fund our other liquidity needs. Our ability to do so depends on, among other factors, prevailing economic conditions, many of which are beyond our control. In addition, upon the occurrence of certain events, such as a change in control, we could be required to repay or refinance our indebtedness. We may not be able to refinance any of our indebtedness, including the Senior Secured Credit Facilities, on commercially reasonable terms or at all. Any future acquisitions, joint ventures, or other similar transactions may require additional capital and there can be no assurance that any such capital will be available to us on acceptable terms or at all.

~~Index~~

~~The majority~~A substantial portion of our cash is in jurisdictions outside of the U.S. However, we believe our U.S. operations will generate sufficient cash flows from operations along with our availability under the Revolving Credit Facility and the Receivables Financing Agreement to satisfy our cash needs in the U.S. As a result of the KKR transaction and the significant increase in our long-term debt balance as of July 30, 2013, we modified our former assertion concerning the permanentUnited States. We do not assert ASC 740-30 (formerly APB 23) indefinite reinvestment of ~~undistributed~~our historical non-U.S. earnings ~~for~~or future non-U.S. ~~subsidiaries in these~~earnings. The Company records a deferred foreign ~~operations. We intend~~tax liability to ~~repatriate certain~~cover all estimated withholding, state income tax and foreign income tax associated with repatriating all non-U.S. earnings ~~for~~back to the ~~purpose of servicing our Senior Secured Credit Facilities in the future, which will result in net U.S. tax liabilities as these foreign earnings are distributed. Accordingly, we recorded a~~United States. Our deferred income tax liability ~~and the balance at September~~as of June 30, ~~2017~~2021 was ~~$78.2~~$42.8 million ~~associated with the repatriation~~which primarily consisted of ~~certain foreign earnings based upon accumulated earnings~~withholding taxes.

Table of ~~approximately $200.0 million.~~Content

Working Capital


	September 30, 2017		December 31, 2016			June 30, 2021		December 31, 2020
Net Working Capital:					Net Working Capital:
Current assets of continuing operations:					Current assets of continuing operations:
Current assets	$	1,403.4	$	1,188.5	Current assets	$	5,712.4	$	3,862.1
Less: Current liabilities		559.6		497.9
Net working capital	$	843.8	$	690.6
Less: Assets of discontinued operations - current					Less: Assets of discontinued operations - current	73.7		337.4
Current assets of continuing operations					Current assets of continuing operations	5,638.7		3,524.7
Current liabilities of continuing operations:					Current liabilities of continuing operations:
Current liabilities					Current liabilities	1,823.0		1,498.6
Less: Liabilities of discontinued operations - current					Less: Liabilities of discontinued operations - current	67.9		212.9
Current liabilities of continuing operations					Current liabilities of continuing operations	1,755.1		1,285.7
Net working capital of continuing operations					Net working capital of continuing operations	$	3,883.6	$	2,239.0

Operating Working Capital:					Operating Working Capital:
Accounts receivable	$	531.6	$	441.6
Accounts receivable and contract assets					Accounts receivable and contract assets	$	988.1	$	922.2
Plus: Inventories (excluding LIFO)		491.7		428.0	Plus: Inventories (excluding LIFO)	788.0		707.9
Less: Accounts payable		263.6		214.9	Less: Accounts payable	660.8		536.4
Less: Advance payments on sales contracts		55.5		43.0
Less: Contract liabilities (current)					Less: Contract liabilities (current)	189.2		164.6
Operating working capital	$	704.2	$	611.7	Operating working capital	$	926.1	$	929.1

InNet working capital of continuing operations increased $1,644.6 million to $3,883.6 million as of June 30, 2021 from $2,239.0 million as of December 31, 2020. Operating working capital decreased $3.0 million to $926.1 million as of June 30, 2021 from $929.1 million as of December 31, 2020. The decrease in operating working capital is primarily due to higher accounts payable, higher contract liabilities and lower contract assets, partially offset by higher inventories and higher accounts receivable.

The increase in accounts receivable was primarily due to the increase in revenue in the second quarter of 2017 we revised our definition of operating working capital to, accounts receivable, plus inventories excluding LIFO, less accounts payable, less advance payments on sales contracts. Prior periods have been restated to conform2021 compared to the current presentation. Net working capital increased $153.2 million to $843.8 million at September 30, 2017 from $690.6 million at December 31, 2016. Operating working capital increased $92.5 million to $704.2 million at September 30, 2017 from $611.7 million at December 31, 2016 due to higher accounts receivable and inventories partially offset by higher accounts payable and advance payments on sales contracts.fourth quarter of 2020. The ~~increase~~decrease in ~~accounts receivables~~contract assets was primarily due to ~~significantly higher revenues and~~ the difference in the sales mix between the fourth quarter of 2016 and the third quarter of 2017. A higher portion of revenues in the fourth quarter of 2016 were related to highly engineered solution product contracts with higher advance payments aheadtiming of revenue recognition ~~than in the third quarter of 2017.~~and billing on our overtime contracts. The increase in inventories was primarily due to ~~higher inventory costs related to projects expected to ship later in the year and~~ additions to inventory in anticipation of increased demand for certain products. The increase in accounts ~~payables~~payable was primarily due to the ~~increase in inventories and~~ timing of vendor cash disbursements. The increase in ~~advance payments on sales contracts~~contract liabilities was primarily due to ~~an increased level~~the timing of ~~in process~~customer milestone payments for in-process engineered to order ~~contracts at the end of the third quarter of 2017 compared to the end of the fourth quarter of 2016.~~

~~Index~~

contracts.

Cash Flows

For the Nine Months Ended September 30,
2017 2016
Cash flows - operating activities $ 83.9 $ 106.8
Cash flows - investing activities (43.1 ) (59.8 )
Cash flows - financing activities (8.2 ) (30.8 )
Free cash flow ⁽¹⁾
47.5 60.5

The following table reflects the major categories of cash flows for the six month periods ended June 30, 2021 and 2020, respectively.

⁽¹⁾

~~See the “Non-GAAP Financial Measures” section included in this Quarterly Report for a reconciliation to the nearest GAAP measure.~~


	For the Six Month Period Ended June 30,
	2021		2020
Cash flows from (used in) continuing operations:
Cash flows from operating activities	$	234.8	$	196.3
Cash flows from (used in) investing activities	(232.2)		20.0
Cash flows used in financing activities	(10.1)		336.9
Cash flows from discontinued operations	1,933.3		116.8
Free cash flow(1)	208.9		173.6

(1)See the “Non-GAAP Financial Measures” section included in this Quarterly Report for a reconciliation to the nearest GAAP measure.

Operating Activities

Cash provided by operating activities ~~decreased $22.9~~increased $38.5 million to ~~$83.9~~$234.8 million infor the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 from ~~$106.8~~$196.3 million in the same ~~nine~~six month period in ~~2016,~~2020, primarily due to ~~cash used by operating working capital of $55.4 million~~an increase in the nine month period ended September 30, 2017 compared to cash provided by operating working capital of $49.5 million in the same period in 2016 as well as increased cash paid for taxes and higher incentive compensation,income from continuing operations, partially offset by ~~higher gross profits on increased revenues and decreased cash paid for interest. Changes~~increases in accounts receivable ~~used cash~~and inventories and a decrease in accrued liabilities.

Table of $65.9 million in the nine month period ended September 30, 2017 compared to generating cash of $18.1 million in the same nine month period in 2016. Changes in inventory used cash of $36.4 million in the nine month period ended September 30, 2017 compared to using cash of $3.8 million in the same nine month period in 2016. Changes in accounts payable generated cash of $39.8 million in the nine month period ended September 30, 2017 compared to generating cash of $21.3 million in the same nine month period ended September 30, 2016. Changes in advance payments on sales contracts generated cash of $7.1 million in the nine month period ended September 30, 2017 compared to generating cash of $13.9 million in the same nine month period ended September 30, 2016.Content

Investing Activities

Cash used byin investing activities included capital expenditures of ~~$36.4~~$25.9 million and ~~$46.3~~$22.7 million for the ~~nine~~six month periods ended ~~September~~June 30, ~~2017~~2021 and ~~2016,~~2020, respectively. ~~We currently expect capital expenditures to total approximately $50.0~~Net cash paid in a business combination was $215.8 million ~~to $60.0 million for~~in the ~~full year in 2017. Cash paid~~six month period ended June 30, 2021 and cash acquired in business combinations for the ~~nine~~six month ~~periods~~period ended ~~September~~June 30, ~~2017 and 2016 were $18.8 million and $18.8 million, respectively. Proceeds from the termination~~2020 was $41.3 million.

Financing Activities

Cash used in financing activities of derivatives for the nine month periods ended September 30, 2017 and 2016 were $6.2 million and $0.0 million, respectively. Net proceeds from business divestitures and disposals of property, plant and equipment were $5.9 million and $5.3$10.1 million for the ~~nine month periods ended September 30, 2017 and 2016, respectively.~~

~~Financing Activities~~

~~Cash used by financing activities of $8.2 million for the nine~~six month period ended ~~September~~June 30, ~~2017 reflects a premium paid on the extinguishment~~2021 primarily reflected repayments of ~~senior notes~~long term debt of ~~$29.7~~$19.7 million and purchases of treasury stock of ~~$2.6 million, purchases of shares of noncontrolling interests of $5.2 million, the payment of debt issuance costs of $2.9 million, and net repayments of long-term borrowings of $861.5~~$3.2 million, partially offset by proceeds from ~~the issuance~~stock option exercises of ~~common stock, net of share issuance costs of $893.3~~$12.8 million.

Cash used byin financing activities of ~~$30.8~~$336.9 million for the ~~nine~~six month period ended ~~September~~June 30, ~~2016 reflects net~~2020 primarily reflected proceeds from long-term debt of $1,980.1 million offset by repayments of long-term borrowings of ~~$19.1 million, purchases of treasury stock of $12.6~~$1,599.6 million and ~~the payment~~payments of debt issuance costs of ~~$1.1~~$46.6 million.

Discontinued Operations

Cash provided by discontinued operations increased $1,816.5 million ~~partially offset by~~to $1,933.3 million for the six month period ended June 30, 2021 from $116.8 million in the same six month period in 2020, primarily due to proceeds from ~~the issuance~~sale of ~~common stock of $2.9 million.~~

discontinued operations.

Free Cash Flow

Free cash flow ~~decreased $13.0~~increased $35.3 million to ~~a free cash inflow of $47.5~~$208.9 million in the ~~nine~~six month period ended ~~September~~June 30, ~~2017~~2021 from ~~a free cash inflow of $60.5~~$173.6 million in the same ~~nine~~six month period in ~~2016. The decrease in free cash flow was~~2020 primarily due to ~~decreased~~increased cash ~~flows from~~provided by operating ~~activities of $22.9 million partially offset by decreased capital expenditures of $9.9 million in the nine month period ended September 30, 2017 compared to the same period in 2016.~~activities.

~~Index~~

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have or are materially likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

~~Contractual Obligations~~

The following table and accompanying disclosures summarize our significant contractual obligations at September 30, 2017, and the effects such obligations are expected to have on our liquidity and cash flow in future periods:

Payments Due by Period
(dollars in millions)
Contractual Obligations
Total
Remainder
of 2017
2018-2019 2020-2021
After
2022

Debt $ 2,013.8 $ 5.2 $ 40.9 $ 40.9 $ 1,926.8
Estimated interest payments ⁽¹⁾
688.9 25.9 221.2 198.9 242.9
Capital leases 19.3 0.4 3.5 3.8 11.6
Operating leases 75.2 6.7 38.8 17.2 12.5
Purchase obligations ⁽²⁾
320.0 238.7 80.0 0.9 0.4
Total $ 3,117.2 $ 276.9 $ 384.4 $ 261.7 $ 2,194.2

⁽¹⁾

Estimated interest payments for variable rate term debt were calculated based on the principal amortization schedules as defined in the Senior Secured Credit Facilities using three month LIBOR interest rate yield curves and the fixed rates on our interest rate swap contracts. No borrowings or outstanding balances on the variable rate revolving credit facility are anticipated during the analysis period.

⁽²⁾

Purchase obligations consist primarily of agreements to purchase inventory or services made in the normal course of business to meet operational requirements. The purchase obligation amounts do not represent the entire anticipated purchases in the future, but represent only those items for which we are contractually obligated as of September 30, 2017. For this reason, these amounts will not provide a complete and reliable indicator of our expected future cash outflows.

Critical Accounting ~~Policies and~~ Estimates

Management has evaluated the accounting ~~policies~~estimates used in the preparation of the Company’s condensed consolidated financial statements and related notes and believe those ~~policies~~estimates to be reasonable and appropriate. Certain of these accounting ~~policies~~estimates require the application of significant judgment by management in selecting appropriate assumptions for calculating financial estimates. By their nature, these judgments are subject to an inherent degree of uncertainty. These judgments are based on historical experience, trends in the industry, information provided by customers and information available from other outside sources, as appropriate. The most significant areas involving management judgments and estimates may be found in the ~~Prospectus, in the~~section “Critical Accounting ~~Policies and~~ Estimates” ~~section~~ of ~~“Management’s~~“Item 7. Management’s Discussion and ~~Analysis”~~Analysis of Financial Condition and Results of Operations” and in Note 1 “Summary of Significant Accounting Policies” of “Item 8. Financial Statements and Supplementary Data” included in our annual report on Form 10-K for the ~~“Notes to Consolidated Financial Statements.” There have been no material changes to our critical accounting policies as compared to the critical accounting policies described in the Prospectus.~~

fiscal year ended December 31, 2020.

Environmental Matters

Information with respect to the effect of compliance with environmental protection requirements and resolution of environmental claims on us and our manufacturing operations is contained in Note 1816 “Contingencies” to the condensed consolidated financial statements. We believe that as of June 30, 2021, there have been no material changes to the ~~Consolidated Financial Statements~~environmental matters disclosed in our ~~Prospectus~~annual report on Form 10-K for the fiscal year ended December 31, ~~2016. We believe that at September 30, 2017, there have been no material change to this information.~~

~~Index~~

2020.

Recent Accounting Pronouncements

The information set forth in Note 1 “Condensed Consolidated Financial Statements” to our Condensed Consolidated Financial Statements under Part I,1 Item 1 “Financial Statements” under the heading “Recently Issued Accounting Pronouncements” is incorporated herein by reference.

~~Item 3.~~

~~Quantitative and Qualitative Disclosures About Market Risk~~

Table of Content

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to interest rate risk as a result of our variable-rate borrowings. We manage our exposure to interest rate risk by ~~maintaining a mixture of fixed and variable debt, and~~using pay-fixed interest rate swaps, from time to time, ~~use pay-fixed interest rate swaps~~ as cash flow hedges of our variable rate debt in order to adjust the relative fixed and variable portions.

In addition, we are exposed to foreign currency risks that arise from our global business operations. Changes in foreign currency exchange rates affect the translation of local currency balances of foreign subsidiaries, transaction gains and losses associated with intercompany loans with foreign subsidiaries and transactions denominated in currencies other than a subsidiary’s functional currency. While future changes in foreign currency exchange rates are difficult to predict, our revenues and earnings may be adversely affected if the U.S. dollar further strengthens.

We seek to minimize our exposure to foreign currency risks through a combination of normal operating activities, including by conducting our international business operations primarily in their functional currencies to match expenses with revenues and the use of foreign currency forward exchange contracts and ~~net investment cross-currency interest rate swaps.~~debt denominated in currencies other than the U.S. dollar. In addition, to mitigate the risk arising from entering into transactions in currencies other than our functional currencies, we typically settle intercompany trading balances ~~monthly.~~

at least quarterly.

As of ~~September~~June 30, ~~2017,~~2021, there have been no material changes to our market risk assessment previously disclosed in the ~~Prospectus.~~annual report on Form 10-K for the fiscal year ended December 31, 2020.

~~Item 4.~~

~~Controls and Procedures~~

Table of Content

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company maintains a set of disclosure controls and procedures as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission (“SEC”) rules and forms, and that such information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. The design of any disclosure controls and procedures is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Any controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance of achieving the desired control objectives. In accordance with Rule 13a-15(b) of the Exchange Act, as of the end of the period covered by this Quarterly Report on Form 10-Q, an evaluation was carried out under the supervision and with the participation of the Company’s management, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of its disclosure controls and procedures. Based on ~~that~~their evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures, as of the end of the period covered by this Quarterly Report on Form 10-Q, were effective to provide reasonable assurance that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and is accumulated and communicated to the Company’s management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Internal Control ~~Over~~over Financial ~~Reporting:~~ Reporting

There ~~has~~have not been any ~~change~~changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

~~Index~~Table of Content

PART II. OTHER INFORMATION

~~Item 1.~~

~~Legal Proceedings~~

ITEM 1. LEGAL PROCEEDINGS

The information set forth in Note ~~14 “Contingencies”~~16 “Contingencies” to our Condensed Consolidated Financial Statements under Part I Item 1 “Financial Statements,” is incorporated herein by reference.

~~Item 1A.~~

~~Risk Factors~~

ITEM 1A. RISK FACTORS

As of ~~September~~June 30, ~~2017,~~2021, there have been no material changes to our risk factors included in our annual report on Form 10-K for the ~~Prospectus.~~year ended December 31, 2020 (the “Annual Report”).

~~Item 2.~~

~~Unregistered Sales of Equity Securities and Use of Proceeds~~

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Company Purchases

~~On May 17, 2017, we completed an initial public offering~~The following table contains detail related to the repurchase of our common stock based on the date of trade during the three month period ended June 30, 2021.


2021 Second Quarter Months	Total Number of Shares Purchased(1)	Average Price Paid Per Share(2)		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs
April 1, 2021 - April 30, 2021	1,046	$	49.61	—	$	—
May 1, 2021 - May 31, 2021	301	$	48.54	—	$	—
June 1, 2021 - June 30, 2021	3,613	$	49.75	—	$	—

(1)All of the shares purchased during the three month period ended June 30, 2021 were in ~~which we issued and sold 47,495,000~~connection with net exercises of stock options or the surrender to us of shares of common stock ~~including 6,195,000 shares~~to satisfy tax withholding obligations in connection with the vesting of ~~common~~certain restricted stock ~~pursuant to the exercise in full of the underwriters’ option to purchase additional shares.~~ units.

(2)The shares sold in the offering were registered under the Securities Act pursuant to our Registration Statement on Form S-1 (File No. 333-216320), which was declared effective by the SEC on May 11, 2017. The common stock is listed on the New York Stock Exchange under the symbol “GDI.” The Company’s shares of common stock were sold at an initial offeringaverage price ~~of $20.00~~paid per share which generated net proceeds of approximately $897.7 million to the Company, after deducting underwriting discounts and commissions of approximately $52.2 million. We estimated that we incurred offering expenses of approximately $4.6 million (exclusive of underwriting discounts and commissions). We used the net proceeds from this offering to redeem all $575.0 million aggregate principal amount of our Senior Notes, including applicable redemption premiums, to repay $276.8 million of borrowings under our U.S. dollar-denominated senior secured term loan facility and to pay related fees and expenses.includes brokerage commissions.

Goldman Sachs & Co. LLC, Citigroup Global Markets Inc., KKR Capital Markets LLC and UBS Securities LLC acted as joint bookrunning managers and as representatives of the underwriters in the offering. Piper Jaffray & Co., Deutsche Bank Securities Inc., Robert W. Baird & Co. Incorporated, Credit Suisse Securities (USA) LLC and Morgan Stanley & Co. LLC were also bookrunners in the offering. William Blair & Company, L.L.C., Stifel, Nicolaus & Company, Incorporated, HSBC Securities (USA) Inc., Macquarie Capital (USA) Inc., Credit Agricole Securities (USA) Inc. and Mizuho Securities USA LLC acted as co-managers in the offering.

~~Item 3.~~

~~Defaults Upon Senior Securities~~

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

~~Item 4.~~

~~Mine Safety Disclosures~~

ITEM 4.MINE SAFETY DISCLOSURES

Not applicable.

~~Item 5.~~

~~Other Information~~

ITEM 5. OTHER INFORMATION

None.

~~Index~~61

~~Item 6.~~

Table of Content

~~Exhibits~~

ITEM 6. EXHIBITS

The following is a list of all exhibits filed or furnished as part of this ~~report:~~

~~Exhibit~~ ~~No.~~	~~Description~~

~~10.1~~	Amendment No. 2 to the Credit Agreement, dated as of August 17, 2017, among Gardner Denver Holdings, Inc., Gardner Denver, Inc., GD German Holdings II GmbH, GD First (UK) Limited, UBS AG, Stamford Branch, as administrative agent, and the other parties and lenders party thereto. (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K on August 18, 2017 (File no. 001-38095)

~~31.1~~	~~Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002 (furnished herewith)~~

~~31.2~~	~~Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002 (furnished herewith)~~

~~32.1~~	~~Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)~~

~~32.2~~	~~Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)~~

~~101.INS~~	~~XBRL Instance Document~~
~~101.SCH~~	~~XBRL Taxonomy Extension Schema Document~~
~~101.CAL~~	~~XBRL Taxonomy Extension Calculation Linkbase Document~~
~~101.DEF~~	~~XBRL Taxonomy Extension Definition Linkbase Document~~
~~101.LAB~~	~~XBRL Taxonomy Extension Label Linkbase Document~~
~~101.PRE~~	~~XBRL Taxonomy Extension Presentation Linkbase Document~~

report.

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other ~~disclosure~~disclosures other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual ~~state~~statement of affairs as of the date they were made or at any other time.


Exhibit No.						Description
2.1						Agreement and Plan of Merger, dated as of April 30, 2019, by and among Ingersoll-Rand plc, Gardner Denver Holdings, Inc., Ingersoll-Rand U.S. HoldCo, Inc. and Charm Merger Sub Inc. (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by Ingersoll-Rand plc on May 6, 2019).
2.2						Separation and Distribution Agreement, dated as of April 30, 2019, by and between Ingersoll-Rand plc and Ingersoll-Rand U.S. HoldCo, Inc. (incorporated by reference to Exhibit 2.2 to the Current Report on Form 8-K filed by Ingersoll-Rand plc on May 6, 2019).
2.3						Securities Purchase Agreement, dated as of April 9, 2021, by and among Ingersoll Rand Inc., Club Car, LLC and MajorDrive Holdings IV, LLC (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by the Company on April 12, 2021).
3.1						Restated Certificate of Incorporation of Ingersoll Rand Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the Company on June 21, 2021).
3.2						Second Amended and Restated Bylaws of Ingersoll Rand Inc. (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed by the Company on June 21, 2021).
31.1						Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
31.2						Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.1						Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.2						Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
101.INS						Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH						Inline XBRL Taxonomy Extension Scheme Document
101.CAL						Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB						Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE						Inline XBRL Taxonomy Extension Presentation Linkbase Document
104						Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit 101)

~~Index~~62

Table of Content~~SIGNATURES~~

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

~~Date: October 27, 2017~~	~~GARDNER DENVER HOLDINGS, INC.~~
Date: July 30, 2021				INGERSOLL RAND INC.
		~~By:~~		~~/s/ Mark R. Sweeney~~
		~~Name: Mark R. Sweeney~~By:	/s/ Michael J. Scheske
		Name: Michael J. Scheske
		Vice President and ~~Chief Accounting Officer~~
	Corporate Controller (Principal Accounting Officer)

~~Delaware~~	~~46-2393770~~
Delaware		46-2393770
(State or Other Jurisdiction of Incorporation or Organization)			(I.R.S. Employer Identification No.)


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, $0.01 Par Value per share	IR	New York Stock Exchange

	~~Page~~ ~~No.~~
		Page No.
PART I. FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements		5 6
Condensed Consolidated Statements of Operations (Unaudited)		6
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited)		7
Condensed Consolidated Balance Sheets (Unaudited)		8
Condensed Consolidated Statements of Stockholders' Equity (Unaudited)		10
Condensed Consolidated Statements of Cash Flows (Unaudited)		11
Note 1. Basis of Presentation and Recent Accounting Pronouncements		12
Note 2. Discontinued Operations		13
Note 3. Business Combinations		15
Note 4. Restructuring		18
Note 5. Inventories		19
Note 6. Goodwill and Other Intangible Assets		19
Note 7. Accrued Liabilities		20
Note 8. Benefit Plans		21
Note 9. Debt		22
Note 10. Stock-Based Compensation Plan		22
Note 11. Accumulated Other Comprehensive Income (Loss)		25
Note 12. Hedging Activities, Derivative Instruments and Fair Value Measurements		27
Note 13. Revenue from Contracts with Customers		30
Note 14. Income Taxes		34
Note 15. Other Operating Expense, Net		34
Note 16. Contingencies		34
Note 17. Segment Results		35
Note 18. Related Party Transactions		37
Note 19. Earnings (Loss) Per Share		37
Note 20. Subsequent Events		38
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		35 39
Item 3. Quantitative and Qualitative Disclosures About Market Risk		53 59
Item 4. Controls and Procedures		53 60
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		54 61
Item 1A. Risk Factors		54 61
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		54 61
Item 3. Defaults Upon Senior Securities		54 61
Item 4. Mine Safety Disclosures		54 61
Item 5. Other Information		54 61
Item 6. Exhibits		55 62
SIGNATURES		56 63

	September 30, 2017			December 31, 2016
Assets
Current assets:
Cash and cash equivalents	$	303.0		$	255.8
Accounts receivable, net of allowance for doubtful accounts of $19.4 and $18.7, respectively		531.6			441.6
Inventories		507.6			443.9
Other current assets		61.2			47.2
Total current assets		1,403.4			1,188.5
Property, plant and equipment, net of accumulated depreciation of $188.5 and $146.1, respectively		352.0			358.4
Goodwill		1,216.9			1,154.7
Other intangible assets, net		1,449.7			1,469.9
Deferred tax assets		0.9			1.4
Other assets		129.7			143.1
Total assets	$	4,552.6		$	4,316.0
Liabilities and Stockholders' Equity
Current liabilities:
Short-term borrowings and current maturities of long-term debt	$	21.1		$	24.5
Accounts payable		263.6			214.9
Accrued liabilities		274.9			258.5
Total current liabilities		559.6			497.9
Long-term debt, less current maturities		2,006.9			2,753.8
Pensions and other postretirement benefits		129.8			122.7
Deferred income taxes		409.2			487.6
Other liabilities		175.3			182.2
Total liabilities		3,280.8			4,044.2
Commitments and contingencies (Note 14)
Stockholders' equity:
Common stock, $0.01 par value; 1,000,000,000 shares authorized; 198,130,973 and 150,552,360 shares issued at September 30, 2017 and December 31, 2016, respectively		2.0			1.5
Capital in excess of par value		2,264.9			1,222.4
Accumulated deficit		(721.4	)		(596.2	)
Accumulated other comprehensive loss		(251.7	)		(342.4	)
Treasury stock at cost; 2,120,112 and 1,897,454 shares at September 30, 2017 and December 31, 2016, respectively		(22.0	)		(19.4	)
Total Gardner Denver Holdings, Inc. stockholders' equity		1,271.8			265.9
Noncontrolling interests		-			5.9
Total stockholders' equity		1,271.8			271.8
Total liabilities and stockholders' equity	$	4,552.6		$	4,316.0

	For the Nine Month Period Ended September 30, 2017

Number of Common Shares Issued (in thousands)
Balance at beginning of period		150,552
Exercise of stock options		84
Common stock issued for initial public offering		47,495
Balance at end of period		198,131
Common Stock
Balance at beginning of period	$	1.5
Exercise of stock options		-
Common stock issued for initial public offering		0.5
Balance at end of period	$	2.0
Capital in Excess of Par Value
Balance at beginning of period	$	1,222.4
Common stock issued for initial public offering, net of underwriting discounts and commissions		897.2
Costs related to initial public offering		(4.6	)
Stock-based compensation		147.3
Exercise of stock options		0.2
Purchase of noncontrolling interest		2.4
Balance at end of period	$	2,264.9
Accumulated Deficit
Balance at beginning of period	$	(596.2	)
Net loss attributable to Gardner Denver Holdings, Inc.		(125.2	)
Balance at end of period	$	(721.4	)
Accumulated Other Comprehensive Loss
Balance at beginning of period	$	(342.4	)
Foreign currency translation adjustments, net		131.4
Foreign currency losses, net		(44.3	)
Unrecognized losses on cash flow hedges, net		5.5
Pension and other postretirement prior service cost and gain or loss, net		(1.9	)
Balance at end of period	$	(251.7	)
Treasury Stock
Balance at beginning of period	$	(19.4	)
Purchases of treasury stock		(2.6	)
Balance at end of period	$	(22.0	)
Total Gardner Denver Holdings, Inc. Stockholders' Equity	$	1,271.8
Noncontrolling Interests
Balance at beginning of period	$	5.9
Net income attributable to noncontrolling interests		0.1
Transfer of noncontrolling interest AOCI to consolidated AOCI		1.6
Purchase of noncontrolling interest		(7.6	)
Balance at end of period	$	-
Total Stockholders' Equity	$	1,271.8

☒
☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐
☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the Three Month Period Ended September 30,						For the Nine Month Period Ended September 30,
	2017			2016			2017			2016

Revenues	$	649.6		$	462.6		$	1,710.4		$	1,361.6
Cost of sales		395.7			298.4			1,066.0			867.1
Gross Profit		253.9			164.2			644.4			494.5
Selling and administrative expenses		111.1			100.9			339.1			310.3
Amortization of intangible assets		29.5			30.7			87.6			90.8
Impairment of other intangible assets		-			-			-			1.5
Other operating expense, net		17.4			12.4			186.7			26.1
Operating Income		95.9			20.2			31.0			65.8
Interest expense		30.1			43.0			115.4			128.7
Loss on extinguishment of debt		34.1			-			84.5			-
Other income, net		(0.7	)		(0.7	)		(2.6	)		(2.6	)
Income (Loss) Before Income Taxes		32.4			(22.1	)		(166.3	)		(60.3	)
Provision (benefit) for income taxes		4.4			(9.1	)		(41.2	)		(33.3	)
Net Income (Loss)		28.0			(13.0	)		(125.1	)		(27.0	)
Less: Net (loss) income attributable to noncontrolling interests		-			(0.1	)		0.1			(0.6	)
Net Income (Loss) Attributable to Gardner Denver Holdings, Inc.	$	28.0		$	(12.9	)	$	(125.2	)	$	(26.4	)
Basic earnings (loss) per share	$	0.14		$	(0.09	)	$	(0.71	)	$	(0.18	)
Diluted earnings (loss) per share	$	0.13		$	(0.09	)	$	(0.71	)	$	(0.18	)

	For the Nine Month Period Ended September 30, 2017			For the Nine Month Period Ended September 30, 2016

Cash Flows From Operating Activities:
Net loss	$	(125.1	)	$	(27.0	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Amortization of intangible assets		87.6			90.8
Depreciation in cost of sales		33.2			30.5
Depreciation in selling and administrative expenses		6.1			5.6
Impairment of other intangible assets		-			1.5
Stock-based compensation expense		166.0			-
Foreign currency transaction losses (gains), net		6.3			(2.6	)
Net loss on asset dispositions		2.0			1.6
Loss on extinguishment of debt		84.5			-
Deferred income taxes		(68.1	)		(45.8	)
Changes in assets and liabilities:
Receivables		(65.9	)		18.1
Inventories		(36.4	)		(3.8	)
Accounts payable		39.8			21.3
Accrued liabilities		(19.8	)		3.9
Other assets and liabilities, net		(26.3	)		12.7
Net cash provided by operating activities		83.9			106.8
Cash Flows From Investing Activities:
Capital expenditures		(36.4	)		(46.3	)
Net cash paid in business combinations		(18.8	)		(18.8	)
Net cash received in business divestitures		-			4.9
Proceeds from the termination of derivatives		6.2			-
Disposals of property, plant and equipment		5.9			0.4
Net cash used in investing activities		(43.1	)		(59.8	)
Cash Flows From Financing Activities:
Principal payments on long-term debt		(2,872.2	)		(20.1	)
Premium paid on extinguishment of senior notes		(29.7	)		-
Proceeds from long-term debt		2,010.7			1.0
Proceeds from the issuance of common stock, net of share issuance costs		893.3			2.9
Purchase of treasury stock		(2.6	)		(12.6	)
Purchase of shares from noncontrolling interests		(5.2	)		-
Payments of debt issuance costs		(2.9	)		(1.1	)
Other		0.4			(0.9	)
Net cash used in financing activities		(8.2	)		(30.8	)
Effect of exchange rate changes on cash and cash equivalents		14.6			(2.3	)
Net increase in cash and cash equivalents		47.2			13.9
Cash and cash equivalents, beginning of period		255.8			228.3
Cash and cash equivalents, end of period	$	303.0		$	242.2
Supplemental Cash Flow Information
Cash paid for income taxes	$	47.4		$	22.7
Cash paid for interest	$	118.1		$	137.2
Capital expenditures in accounts payable	$	3.0		$	5.9
Property and equipment acquired under capital leases	$	-		$	7.7
Expenditures directly related to our initial public offering in accounts payable	$	0.2		$	-


	Three Month Period Ended June 30, 2021
	Common Stock			Capital in Excess of Par Value		Accumulated Deficit		Accumulated Other Comprehensive Loss		Treasury Stock		Total Ingersoll Rand Inc. Stockholders' Equity		Noncontrolling Interests		Total Equity
	Shares Issued	Par
Balance at beginning of period	420.9	$	4.2	$	9,337.8	$	(266.1)	$	(84.4)	$	(34.8)	$	8,956.7	$	69.0	$	9,025.7
Net income	—	—		—		233.9		—		—		233.9		0.7		234.6
Issuance of common stock for stock-based compensation plans	0.6	—		7.6		—		—		—		7.6		—		7.6
Purchases of treasury stock	—	—		—		—		—		(0.2)		(0.2)		—		(0.2)
Issuance of treasury stock for stock-based compensation plans	—	—		—		—		—		0.4		0.4		—		0.4
Stock-based compensation	—	—		30.6		—		—		—		30.6		—		30.6
Other comprehensive income (loss), net of tax	—	—		—		—		50.4		—		50.4		(1.2)		49.2
Divestiture of foreign subsidiaries	—	—		—		—		(1.5)		—		(1.5)		—		(1.5)
Balance at end of period	421.5	$	4.2	$	9,376.0	$	(32.2)	$	(35.5)	$	(34.6)	$	9,277.9	$	68.5	$	9,346.4


	Three Month Period Ended June 30, 2020
	Common Stock			Capital in Excess of Par Value		Accumulated Deficit		Accumulated Other Comprehensive Loss		Treasury Stock		Total Ingersoll Rand Inc. Stockholders' Equity		Noncontrolling Interests		Total Equity
	Shares Issued	Par
Balance at beginning of period	418.2	$	4.2	$	9,241.5	$	(179.2)	$	(344.1)	$	(36.2)	$	8,686.2	$	69.3	$	8,755.5
Net income (loss)	—	—		—		(177.6)		—		—		(177.6)		1.1		(176.5)


Issuance of common stock for stock-based compensation plans	0.4	—		3.7		—		—		—		3.7		—		3.7
Purchases of treasury stock	—	—		—		—		—		(0.5)		(0.5)		—		(0.5)
Issuance of treasury stock for stock-based compensation plans	—	—		(0.5)		—		—		0.9		0.4		—		0.4
Stock-based compensation	—	—		11.8		—		—		—		11.8		—		11.8
Other comprehensive income (loss), net of tax	—	—		—		—		50.9		—		50.9		(1.5)		49.4

Adjustments for shares tendered in open offer	—	—		—		—		—		—		—		(2.0)		(2.0)
Balance at end of period	418.6	$	4.2	$	9,256.5	$	(356.8)	$	(293.2)	$	(35.8)	$	8,574.9	$	66.9	$	8,641.8


	Six Month Period Ended June 30, 2021
	Common Stock			Capital in Excess of Par Value		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total Ingersoll Rand Inc. Stockholders' Equity		Noncontrolling Interests		Total Equity
	Shares Issued	Par
Balance at beginning of period	420.1	$	4.2	$	9,310.3	$	(175.7)	$	14.2	$	(33.3)	$	9,119.7	$	69.8	$	9,189.5
Net income	—	—		—		143.5		—		—		143.5		1.0		144.5
Issuance of common stock for stock-based compensation plans	1.4	—		12.3		—		—		—		12.3		—		12.3
Purchases of treasury stock	—	—		—		—		—		(3.2)		(3.2)		—		(3.2)
Issuance of treasury stock for stock-based compensation plans	—	—		(1.1)		—		—		1.9		0.8		—		0.8
Stock-based compensation	—	—		54.5		—		—		—		54.5		—		54.5
Other comprehensive loss, net of tax	—	—		—		—		(48.2)		—		(48.2)		(2.3)		(50.5)
Divestiture of foreign subsidiaries	—	—		—		—		(1.5)		—		(1.5)		—		(1.5)
Balance at end of period	421.5	$	4.2	$	9,376.0	$	(32.2)	$	(35.5)	$	(34.6)	$	9,277.9	$	68.5	$	9,346.4


	Six Month Period Ended June 30, 2020
	Common Stock			Capital in Excess of Par Value		Accumulated Deficit		Accumulated Other Comprehensive Loss		Treasury Stock		Total Ingersoll Rand Inc. Stockholders' Equity		Noncontrolling Interests		Total Equity
	Shares Issued	Par
Balance at beginning of period	206.8	$	2.1	$	2,302.0	$	(141.4)	$	(256.0)	$	(36.8)	$	1,869.9	$	0	$	1,869.9
Net income (loss)	—	—		—		(214.4)		—		—		(214.4)		1.0		(213.4)
Acquisition of Ingersoll Rand Industrial	211.0	2.1		6,934.9		—		—		—		6,937.0		72.3		7,009.3
Costs of issuing equity securities	—	—		(1.0)		—		—		—		(1.0)		—		(1.0)
Issuance of common stock for stock-based compensation plans	0.8	—		5.9		—		—		—		5.9		—		5.9
Purchases of treasury stock	—	—		—		—		—		(1.3)		(1.3)		—		(1.3)
Issuance of treasury stock for stock-based compensation plans	—	—		(1.5)		—		—		2.3		0.8		—		0.8
Stock-based compensation	—	—		16.2		—		—		—		16.2		—		16.2
Other comprehensive loss, net of tax	—	—		—		—		(37.2)		—		(37.2)		(4.4)		(41.6)
Adoption of new accounting standard (ASU 2016-13)	—	—		—		(1.0)		—		—		(1.0)		—		(1.0)
Adjustments for shares tendered in open offer	—	—		—		—		—		—		—		(2.0)		(2.0)
Balance at end of period	418.6	$	4.2	$	9,256.5	$	(356.8)	$	(293.2)	$	(35.8)	$	8,574.9	$	66.9	$	8,641.8


	Specialty Vehicle Technologies				High Pressure Solutions				Total
	For the Three Month Period Ended June 30,
	2021		2020		2021		2020		2021		2020
Revenues	$	184.0	$	217.5	$	3.0	$	21.5	$	187.0	$	239.0
Cost of sales	137.9		166.4		3.9		21.2		141.8		187.6
Gross Profit	46.1		51.1		(0.9)		0.3		45.2		51.4
Selling and administrative expenses	16.9		18.2		0.6		20.4		17.5		38.6
Amortization of intangible assets	0.9		12.3		0		5.9		0.9		18.2
Loss (gain) on sale	(256.7)		0		8.4		0		(248.3)		0
Other operating expense (income), net	9.2		(0.1)		7.4		1.9		16.6		1.8




Income (Loss) from Discontinued Operations Before Income Taxes	275.8		20.7		(17.3)		(27.9)		258.5		(7.2)
Provision (benefit) for income taxes	162.8		29.2		(0.6)		(11.8)		162.2		17.4
Income (Loss) from Discontinued Operations, Net of Tax	$	113.0	$	(8.5)	$	(16.7)	$	(16.1)	$	96.3	$	(24.6)


	June 30, 2021 (1)		December 31, 2020 (2)
Assets
Current assets:

Accounts receivable, net	$	18.7	$	104.8
Inventories	19.6		226.9
Other current assets	4.5		5.7
Total current assets	42.8		337.4
Property, plant and equipment, net	2.1		188.3
Goodwill	0.8		721.0
Other intangible assets, net	28.0		935.4
Deferred tax assets	0		0.5
Other assets	0		17.6
Total non-current assets	30.9		1,862.8


Total assets	$	73.7	$	2,200.2

Liabilities
Current liabilities:

Accounts payable	$	32.3	$	134.7
Accrued liabilities	31.8		78.2
Total current liabilities	64.1		212.9

Pensions and other postretirement benefits	0		2.5
Deferred income taxes	3.8		173.3
Other liabilities	0		17.0
Total non-current liabilities	3.8		192.8
Total liabilities	$	67.9	$	405.7


	M-D Pneumatics and Kinney Vacuum Pumps		All Others
Accounts receivable	$	4.8	$	2.5
Inventories	3.8		2.7
Other current assets	0.6		0
Property, plant and equipment	16.2		2.5
Goodwill	80.0		3.5
Other intangible assets	82.5		23.9
Total current liabilities	(3.5)		(1.8)
Total noncurrent liabilities	0		(1.8)
Total consideration	$	184.4	$	31.5


Fair value of Ingersoll Rand common stock issued for Ingersoll Rand Industrial outstanding common stock	$	6,919.5
Fair value attributable to pre-merger service for replacement equity awards	8.6
Fair value attributable to pre-merger service for deferred compensation plan	8.9
Total purchase consideration	$	6,937.0


	Fair value
Cash	$	38.8
Accounts receivable	585.8
Inventories	625.4
Other current assets	87.2
Property, plant and equipment	516.5
Goodwill	4,899.2
Other intangible assets	3,766.6
Other noncurrent assets	270.9
Total current liabilities, including current maturities of long-term debt of $19.0 million	(753.0)
Deferred tax liability	(842.4)
Long-term debt, net of debt issuance costs and an original issue discount	(1,851.7)
Other noncurrent liabilities	(333.0)
Noncontrolling interest	(73.3)
Total consideration	$	6,937.0


	For the Three Month Period Ended June 30, 2020		For the Six Month Period Ended June 30, 2020

Revenues	$	609.0	$	815.7
Income (Loss) from Continuing Operations Before Income Taxes	(82.1)		(124.8)


	For the Three Month Period Ended June 30, 2020		For the Six Month Period Ended June 30, 2020

Increase to revenue as a result of deferred revenue fair value adjustment, net of tax	$	5.6	$	5.5
Decrease to expense as a result of inventory fair value adjustment, net of tax	(58.5)		(89.6)
Decrease to expense as a result of transaction costs, net of tax	0		(38.1)

	Industrials Program			Energy Program			Medical Program			Total
Balance at December 31, 2016	$	11.1		$	5.6		$	4.2		$	20.9
Charged to expense - termination benefits		2.3			(0.3	)		(0.1	)		1.9
Charged to expense - other		2.1			0.7			0.2			3.0
Payments		(10.7	)		(4.2	)		(2.4	)		(17.3	)
Other, net		0.7			-			0.3			1.0
Balance at September 30, 2017	$	5.5		$	1.8		$	2.2		$	9.5


	June 30, 2021		December 31, 2020
Raw materials, including parts and subassemblies	$	490.4	$	451.0
Work-in-process	87.0		62.2
Finished goods	210.6		194.7
	788.0		707.9
Excess of LIFO costs over FIFO costs	8.8		8.8
Inventories	$	796.8	$	716.7

	Industrials		Energy		Medical		Total
Balance as of December 31, 2016	$	515.8	$	439.9	$	199.0	$	1,154.7
Acquisition		7.9		-		-		7.9
Foreign currency translation and other ⁽¹⁾		31.8		16.6		5.9		54.3
Balance as of September 30, 2017	$	555.5	$	456.5	$	204.9	$	1,216.9


	Industrial Technologies and Services		Precision and Science Technologies		Total
Balance as of December 31, 2020	$	4,151.2	$	1,431.4	$	5,582.6
Acquisitions	76.7		0		76.7
Foreign currency translation	(18.4)		(3.9)		(22.3)
Balance as of June 30, 2021	$	4,209.5	$	1,427.5	$	5,637.0

	September 30, 2017					December 31, 2016
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount		Accumulated Amortization
Amortized intangible assets:
Customer lists and relationships	$	1,216.2	$	(442.1	)	$	1,160.5	$	(345.5	)
Acquired technology		8.0		(2.8	)		7.1		(2.2	)
Trademarks		30.2		(9.7	)		27.4		(6.9	)
Backlog		64.7		(64.7	)		60.3		(60.3	)
Other		47.6		(21.2	)		36.4		(16.4	)
Unamortized intangible assets:
Trademarks		623.5		-			609.5		-
Total other intangible assets	$	1,990.2	$	(540.5	)	$	1,901.2	$	(431.3	)


	June 30, 2021						December 31, 2020
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Amortized intangible assets
Customer lists and relationships	$	2,857.7	$	(928.1)	$	1,929.6	$	2,835.0	$	(841.3)	$	1,993.7
Technology	293.9		(56.4)		237.5		279.9		(38.1)		241.8
Tradenames	41.5		(17.8)		23.7		41.8		(15.6)		26.2

Other	107.2		(71.7)		35.5		102.8		(58.6)		44.2
Unamortized intangible assets
Tradenames	1,499.2		—		1,499.2		1,491.3		—		1,491.3
Total other intangible assets	$	4,799.5	$	(1,074.0)	$	3,725.5	$	4,750.8	$	(953.6)	$	3,797.2

	Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016

Intangible asset amortization expense	$	29.5	$	30.7	$	87.6	$	90.8

	September 30, 2017		December 31, 2016

Salaries, wages and related fringe benefits	$	83.0	$	56.5
Restructuring		9.1		20.2
Taxes		43.1		37.1
Advance payments on sales contracts		55.5		43.0
Product warranty		23.6		21.7
Accrued interest		0.5		15.5
Other		60.1		64.5
Total accrued liabilities	$	274.9	$	258.5


	Three Months Ended September 30, 2017			Three Months Ended September 30, 2016			Nine Months Ended September 30, 2017			Nine Months Ended September 30, 2016				For the Three Month Period Ended June 30,				For the Six Month Period Ended June 30,
														2021		2020		2021		2020
Balance at beginning of period	$	21.7		$	24.2		$	21.7		$	27.6		Balance at beginning of period	$	40.4	$	37.6	$	41.1	$	19.1
Product warranty accruals		6.7			3.6			17.8			12.2		Product warranty accruals	5.4		3.0		9.8		7.6
Acquired warranty													Acquired warranty	0		0		0.1		19.8
Settlements		(5.0	)		(5.5	)		(17.1	)		(17.2	)	Settlements	(4.1)		(2.5)		(8.9)		(7.9)
Charged to other accounts⁽¹⁾		0.2			(0.5	)		1.2			(0.8	)	Charged to other accounts(1)	0.3		0.6		(0.1)		0.1
Balance at end of period	$	23.6		$	21.8		$	23.6		$	21.8		Balance at end of period	$	42.0	$	38.7	$	42.0	$	38.7


	Pension Benefits								Other Postretirement Benefits
	U.S. Plans				Non-U.S. Plans
	For the Three Month Period Ended June 30,
	2021		2020		2021		2020		2021		2020
Service cost	$	1.7	$	1.7	$	1.1	$	1.2	$	0	$	0
Interest cost	2.8		2.8		1.1		1.5		0.1		0.2
Expected return on plan assets	(3.1)		(3.9)		(3.0)		(2.7)		0		0
Recognition of:
Unrecognized prior service cost	0		0		0.1		0.1		(0.1)		0
Unrecognized net actuarial loss	0		0		1.2		0.7		0		0
	$	1.4	$	0.6	$	0.5	$	0.8	$	0	$	0.2


	Pension Benefits												Other Postretirement					Pension Benefits								Other Postretirement Benefits
	U.S. Plans						Non-U.S. Plans						Benefits					U.S. Plans				Non-U.S. Plans				Other Postretirement Benefits
		Three Months Ended September 30, 2017		Nine Months Ended September 30, 2017			Three Months Ended September 30, 2017			Nine Months Ended September 30, 2017			Three Months Ended September 30, 2017		Nine Months Ended September 30, 2017			For the Six Month Period Ended June 30,
																		2021		2020		2021		2020		2021		2020
Service cost		-		$	-		$	0.5		$	1.4		$	-	$	-	Service cost	$	3.4	$	2.3	$	2.2	$	1.9	$	0	$	0
Interest cost		0.6			1.7			2.0			5.8			-		0.1	Interest cost	5.5		4.0		2.3		3.0		0.3		0.3
Expected return on plan assets		(1.1	)		(3.3	)		(2.7	)		(7.7	)		-		-	Expected return on plan assets	(6.2)		(5.5)		(6.1)		(5.4)		0		0
Recognition of:																	Recognition of:
Unrecognized prior service cost		-			-			-			-			-		-	Unrecognized prior service cost	0		0		0.1		0.1		(0.2)		0
Unrecognized net actuarial loss		-			-			1.3			3.7			-		-	Unrecognized net actuarial loss	0		0		2.5		1.4		0		0
	$	(0.5	)	$	(1.6	)	$	1.1		$	3.2		$	-	$	0.1		$	2.7	$	0.8	$	1.0	$	1.0	$	0.1	$	0.3

	September 30, 2017			December 31, 2016

Short-term borrowings	$	-		$	-
Long-term debt:
Revolving credit facility, due 2020	$	-		$	-
Receivables financing agreement, due 2020		-			-
Term loan denominated in U.S. dollars, due 2020 ^{(1) (3)}		-			1,833.2
Term loan denominated in Euros, due 2020 ^{(2) (4)}		-			405.5
Term loan denominated in U.S. dollars, due 2024 ⁽⁵⁾		1,285.5			-
Term loan denominated in Euros, due 2024 ⁽⁶⁾		726.4			-
Senior notes, due 2021 ⁽⁷⁾		-			575.0
Second mortgages ⁽⁸⁾		1.9			1.9
Capitalized leases and other long-term debt		19.3			21.6
Unamortized debt issuance costs		(5.1	)		(58.9	)
Total long-term debt, net, including current maturities		2,028.0			2,778.3
Current maturities of long-term debt		21.1			24.5
Total long-term debt, net	$	2,006.9		$	2,753.8


	Shares	Weighted-Average Exercise Price (per share)
Stock options outstanding as of December 31, 2020	7,742	$	18.47

Granted	758	45.58
Exercised or settled	(800)	16.83
Forfeited	(209)	30.57
Expired	(5)	9.07
Stock options outstanding as of June 30, 2021	7,486	21.06

Vested as of June 30, 2021	5,041	15.69

	Shares			Weighted-Average Exercise Price (per share)
Outstanding at December 31, 2016		13,285		$	8.85
Granted		799		$	20.00
Settled		(92	)	$	8.17
Forfeited		(938	)	$	8.21
Outstanding at September 30, 2017		13,054		$	9.52

Vested at September 30, 2017		6,676		$	8.73

	~~Nine Months~~ ~~Ended~~ ~~September 30,~~ ~~2017~~
~~Assumptions:~~
~~Expected life of options (in years)~~		~~5.00 - 6.25~~
~~Risk-free interest rate~~		~~1.94 - 2.12~~	%
~~Assumed volatility~~		~~41.2 - 45.8~~	%
~~Expected dividend rate~~		~~0.00~~	%