Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Oct. 31, 2013 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'WEST PHARMACEUTICAL SERVICES INC | ' |
Entity Central Index Key | '0000105770 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 69,835,454 |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-13 | ' |
CONDENSED_CONSOLIDATED_STATEME
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Statement [Abstract] | ' | ' | ' | ' |
Net sales | $341.80 | $303.80 | $1,025.70 | $944.90 |
Cost of goods and services sold | 236.3 | 213.4 | 697.6 | 654.7 |
Gross profit | 105.5 | 90.4 | 328.1 | 290.2 |
Research and development | 9.6 | 8.2 | 28.2 | 24.6 |
Selling, general and administrative expenses | 56.1 | 53.7 | 174.9 | 159.5 |
Restructuring and other items (Note 2) | 0.1 | 2.2 | -0.5 | 2.5 |
Operating profit | 39.7 | 26.3 | 125.5 | 103.6 |
Loss on debt extinguishment | 0 | 0 | 0.2 | 11.6 |
Interest expense | 4.4 | 4.4 | 13.1 | 13.2 |
Interest income | 0.4 | 0.5 | 1.4 | 1.5 |
Income before income taxes | 35.7 | 22.4 | 113.6 | 80.3 |
Income tax expense | 10.6 | 9 | 29.5 | 25.5 |
Equity in net income of affiliated companies | 1.7 | 1.4 | 4.6 | 4.8 |
Net income | $26.80 | $14.80 | $88.70 | $59.60 |
Net income per share: | ' | ' | ' | ' |
Basic (in dollars per share) | $0.38 | $0.22 | $1.28 | $0.88 |
Diluted (in dollars per share) | $0.37 | $0.21 | $1.25 | $0.85 |
Weighted average shares outstanding: | ' | ' | ' | ' |
Basic (in shares) | 69.8 | 68.3 | 69.4 | 68 |
Diluted (in shares) | 71.4 | 69.4 | 70.9 | 72.3 |
Dividends declared per share | $0.10 | $0 | $0.29 | $0.18 |
CONDENSED_CONSOLIDATED_STATEME1
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net income | $26.80 | $14.80 | $88.70 | $59.60 |
Other comprehensive income (loss), net of tax: | ' | ' | ' | ' |
Foreign currency translation adjustments | 14.5 | 16.8 | -4.6 | -0.5 |
Defined benefit pension and other postretirement plan adjustments, net of tax of $4.1, $0.5, $5.8 and $1.9, respectively | 6.4 | 0.5 | 9.6 | 2.8 |
Net gains (losses) on derivatives, net of tax of $0.8, $(0.1), $0.9 and $(1.7), respectively | 1 | -0.3 | 1.4 | -2.6 |
Other comprehensive income (loss), net of tax | 21.9 | 17 | 6.4 | -0.3 |
Comprehensive income | $48.70 | $31.80 | $95.10 | $59.30 |
CONDENSED_CONSOLIDATED_STATEME2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Statement of Comprehensive Income [Abstract] | ' | ' | ' | ' |
Defined benefit pension and other postretirement plan adjustments, tax | $4.10 | $0.50 | $5.80 | $1.90 |
Net gains (losses) on derivatives, tax | $0.80 | ($0.10) | $0.90 | ($1.70) |
CONDENSED_CONSOLIDATED_BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $221.70 | $161.90 |
Short-term investments | 7.5 | 12.4 |
Accounts receivable, net | 198.2 | 175 |
Inventories | 176.7 | 162.2 |
Deferred income taxes | 9.3 | 7.7 |
Other current assets | 30.1 | 38.1 |
Total current assets | 643.5 | 557.3 |
Property, plant and equipment | 1,328.40 | 1,274.80 |
Less accumulated depreciation and amortization | 646.4 | 605.8 |
Property, plant and equipment, net | 682 | 669 |
Investments in affiliated companies | 59.1 | 59.8 |
Goodwill | 113.4 | 112.5 |
Deferred income taxes | 92.4 | 90.3 |
Intangible assets, net | 48.5 | 50.6 |
Other noncurrent assets | 25.6 | 24.5 |
Total Assets | 1,664.50 | 1,564 |
Current liabilities: | ' | ' |
Notes payable and other current debt | 18.9 | 32.7 |
Accounts payable | 86.3 | 102.9 |
Pension and other postretirement benefits | 3 | 2.8 |
Accrued salaries, wages and benefits | 55.8 | 56.5 |
Income taxes payable | 26.4 | 15.6 |
Taxes other than income | 8 | 7.8 |
Other current liabilities | 48.4 | 43.5 |
Total current liabilities | 246.8 | 261.8 |
Long-term debt | 381.1 | 378.8 |
Deferred income taxes | 19.6 | 20.8 |
Pension and other postretirement benefits | 126.1 | 135.4 |
Other long-term liabilities | 54.2 | 38.3 |
Total Liabilities | 827.8 | 835.1 |
Commitments and contingencies (Note 13) | ' | ' |
Equity: | ' | ' |
Preferred stock, 3.0 million shares authorized; 0 shares issued and outstanding | 0 | 0 |
Common stock, $0.25 par value; 100.0 million shares authorized; issued: 69.9 million and 68.8 million; outstanding: 69.7 million and 68.6 million | 17.5 | 17.2 |
Capital in excess of par value | 103.9 | 70.7 |
Retained earnings | 788.6 | 719.9 |
Accumulated other comprehensive loss | -69.5 | -75.9 |
Treasury stock, at cost (0.2 million shares in 2013 and 2012) | -3.8 | -3 |
Total Equity | 836.7 | 728.9 |
Total Liabilities and Equity | $1,664.50 | $1,564 |
CONDENSED_CONSOLIDATED_BALANCE1
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, except Per Share data, unless otherwise specified | ||
Balance Sheet Related Disclosures [Abstract] | ' | ' |
Preferred Stock, Shares Authorized | 3 | 3 |
Preferred Stock, Shares Issued | 0 | 0 |
Preferred Stock, Shares Outstanding | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $0.25 | $0.25 |
Common Stock, Shares Authorized | 100 | 100 |
Common Stock, Shares, Issued | 69.9 | 68.8 |
Common Stock, Shares, Outstanding | 69.7 | 68.6 |
Treasury Stock, Shares | 0.2 | 0.2 |
CONDENSED_CONSOLIDATED_STATEME3
CONDENSED CONSOLIDATED STATEMENT OF EQUITY (UNAUDITED) (USD $) | Total | Common Stock [Member] | Capital in Excess of Par Value [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Loss [Member] |
In Millions, unless otherwise specified | ||||||
Balance at Dec. 31, 2012 | $728.90 | $17.20 | $70.70 | ($3) | $719.90 | ($75.90) |
Balance (in shares) at Dec. 31, 2012 | ' | 68.8 | ' | ' | ' | ' |
Increase (Decrease) in Equity [Roll Forward] | ' | ' | ' | ' | ' | ' |
Net income | 88.7 | ' | ' | ' | 88.7 | ' |
Stock-based compensation | 11.8 | ' | 11.8 | ' | ' | ' |
Shares issued under stock plans | 21.7 | 0.3 | 22.2 | -0.8 | ' | ' |
Shares issued under stock plans (in shares) | ' | 1.3 | ' | ' | ' | ' |
Shares repurchased for employee tax withholdings | -5.2 | ' | -5.2 | ' | ' | ' |
Shares repurchased for employee tax withholdings (in shares) | ' | -0.2 | ' | ' | ' | ' |
Excess tax benefit from employee stock plans | 4.4 | ' | 4.4 | ' | ' | ' |
Dividends declared | -20 | ' | ' | ' | -20 | ' |
Other comprehensive income, net of tax | 6.4 | ' | ' | ' | ' | 6.4 |
Balance at Sep. 30, 2013 | $836.70 | $17.50 | $103.90 | ($3.80) | $788.60 | ($69.50) |
Balance (in shares) at Sep. 30, 2013 | ' | 69.9 | ' | ' | ' | ' |
CONDENSED_CONSOLIDATED_STATEME4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Cash flows from operating activities: | ' | ' |
Net income | $88.70 | $59.60 |
Depreciation | 59.9 | 53.6 |
Amortization | 3.2 | 3.1 |
Loss on debt extinguishment | 0.2 | 11.6 |
Asset impairment charges | 0 | 6.2 |
Stock-based compensation | 15.6 | 11.8 |
Other non-cash items, net | -4 | -4.2 |
Changes in assets and liabilities | -11.9 | -24.1 |
Net cash provided by operating activities | 151.7 | 117.6 |
Cash flows from investing activities: | ' | ' |
Capital expenditures | -113.1 | -98.4 |
Purchases of short-term investments | -13.3 | -27.3 |
Sales and maturities of short-term investments | 18.3 | 32.1 |
Other, net | -2.9 | 0.3 |
Net cash used in investing activities | -111 | -93.3 |
Cash flows from financing activities: | ' | ' |
Borrowings under revolving credit agreements | 249.8 | 474.8 |
Repayments under revolving credit agreements | -241.3 | -381.8 |
Repayments of long-term debt | -29.9 | -215.9 |
Issuance of long-term debt | 43.3 | 168 |
Debt issuance costs | 0 | -7.4 |
Dividend payments | -19.7 | -18.3 |
Excess tax benefit from employee stock plans | 4.4 | 2.3 |
Shares repurchased for employee tax withholdings | -5.2 | -2.2 |
Proceeds from stock option exercises | 15.1 | 5 |
Employee stock purchase plan contributions | 1.9 | 1.6 |
Net cash provided by financing activities | 18.4 | 26.1 |
Effect of exchange rates on cash | 0.7 | 1 |
Net increase in cash and cash equivalents | 59.8 | 51.4 |
Cash, including cash equivalents at beginning of period | 161.9 | 91.8 |
Cash, including cash equivalents at end of period | $221.70 | $143.20 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Summary of Significant Accounting Policies | ' |
Summary of Significant Accounting Policies | |
Basis of Presentation: The condensed consolidated financial statements included in this report are unaudited and have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial reporting and Securities and Exchange Commission (“SEC”) regulations. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. In the opinion of management, these financial statements include all adjustments, which are of a normal recurring nature, necessary for a fair statement of the financial position, results of operations, cash flows and the change in equity for the periods presented. The condensed consolidated financial statements for the three and nine month periods ended September 30, 2013 should be read in conjunction with the consolidated financial statements and notes thereto of West Pharmaceutical Services, Inc. (which may be referred to as “West”, “the Company”, “we”, “us” or “our”), appearing in our Annual Report on Form 10-K for the year ended December 31, 2012 (“2012 Annual Report”). The results of operations for any interim period are not necessarily indicative of results for the full year. | |
Stock Split: On August 1, 2013, our Board of Directors approved a two-for-one stock split of our outstanding shares of common stock, effected in the form of a stock dividend. The record date for the stock split was September 12, 2013, and the share distribution occurred on September 26, 2013. All share and per share amounts presented in the accompanying condensed consolidated financial statements and related notes have been retroactively adjusted to reflect the impact of this stock split. | |
Reclassifications: Certain reclassifications were made to prior period financial statements to conform to the current year presentation. |
Restructuring_and_Other_Items
Restructuring and Other Items | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Restructuring and Other Items [Abstract] | ' | |||||||||||||||
Restructuring and Other Items | ' | |||||||||||||||
Restructuring and Other Items | ||||||||||||||||
Restructuring and other items consisted of: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Restructuring and related charges (reversals): | ||||||||||||||||
Severance and post-employment benefits | $ | — | $ | (1.1 | ) | $ | — | $ | (1.3 | ) | ||||||
Impairments and asset write-offs | — | 2 | — | 2.4 | ||||||||||||
Other restructuring charges | — | 0.2 | — | 0.7 | ||||||||||||
Total restructuring and related charges | — | 1.1 | — | 1.8 | ||||||||||||
Impairment charge | — | — | — | 3.4 | ||||||||||||
Development income | (0.4 | ) | (0.4 | ) | (1.2 | ) | (4.2 | ) | ||||||||
Acquisition-related contingencies | 0.3 | 0.5 | 0.5 | 0.9 | ||||||||||||
Foreign exchange and other | 0.2 | 1 | 0.2 | 0.6 | ||||||||||||
Total restructuring and other items | $ | 0.1 | $ | 2.2 | $ | (0.5 | ) | $ | 2.5 | |||||||
Restructuring and Related Charges | ||||||||||||||||
Total restructuring and related charges incurred during the three and nine months ended September 30, 2012 were associated with the restructuring plan announced in December 2010 (the "2010 plan"). These charges consisted of costs associated with the 2011 closure of a plant in the United States, the reduction of operations at a manufacturing facility in England and the elimination of certain operational and administrative functions at other locations. | ||||||||||||||||
During the third quarter of 2012, we finalized an agreement concerning future manufacturing and supply requirements at our manufacturing facility in England, which triggered an impairment review of the related assets. Our review concluded that the estimated fair value of the assets no longer exceeded their carrying value, and therefore, an impairment charge of $1.5 million was recorded. We estimated the fair value of the assets using an income approach based on discounted cash flows. Offsetting the costs incurred in the third quarter of 2012 were reductions to certain previously-recorded obligations under the 2010 plan, including a reduction of $1.7 million following the cancellation of the restructuring initiative at one of our plants in Europe as a result of increased customer demand for products and related efficiency improvements at that plant. | ||||||||||||||||
We have not incurred any restructuring and related charges during 2013, and we do not expect to incur any future charges related to the 2010 plan. | ||||||||||||||||
The following table presents activity related to our restructuring obligations: | ||||||||||||||||
($ in millions) | Severance | |||||||||||||||
and benefits | ||||||||||||||||
Balance, December 31, 2012 | $ | 2.8 | ||||||||||||||
Cash payments | (2.7 | ) | ||||||||||||||
Balance, September 30, 2013 | $ | 0.1 | ||||||||||||||
We expect all payments to be completed by the end of 2013. | ||||||||||||||||
Other Items | ||||||||||||||||
During the three and nine months ended September 30, 2013, we recorded development income of $0.4 million and $1.2 million, respectively, within the Pharmaceutical Delivery Systems segment ("Delivery Systems"). Included in these amounts was $0.4 million and $0.7 million, respectively, of income related to a nonrefundable payment of $20.0 million received from a customer in June 2013 in return for the exclusive use of our SmartDose™ electronic patch injector system ("SmartDose") within a specific therapeutic area. Unearned income related to this payment of $1.5 million and $17.8 million was included within other current liabilities and other long-term liabilities, respectively, at September 30, 2013. The unearned income is being recognized as development income on a straight-line basis over the remaining term of the agreement, which is thirteen years. The agreement does not include a future minimum purchase commitment from the customer. During the three and nine months ended September 30, 2012, we recorded development income of $0.4 million and $4.2 million, respectively, within Delivery Systems attributable to services and the reimbursement of certain costs. | ||||||||||||||||
The liability for contingent consideration related to our 2010 acquisition of technology used in SmartDose (“SmartDose contingent consideration”) increased by $0.3 million and $0.5 million during the three and nine months ended September 30, 2013, respectively, due to the time value of money and adjustments related to changes in sales projections. During the three and nine months ended September 30, 2012, the fair value of the SmartDose contingent consideration increased by $0.5 million and $0.9 million, respectively, due to the same factors described above. | ||||||||||||||||
In addition, during 2012, as a result of continuing delays and lower-than-expected demand, we updated the sales projections related to one of our product lines in Delivery Systems. The revised projections triggered an impairment review of the associated assets. Our review concluded that the estimated fair value of the product line no longer exceeded the carrying value of the related assembly equipment and intangible asset and, therefore, an impairment charge of $3.4 million was recorded during the second quarter of 2012. We estimated the fair value of the asset group using an income approach based on discounted cash flows. |
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2013 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
Income Taxes | |
The tax provision for interim periods is determined using the estimated annual effective consolidated tax rate, based on the current estimate of full-year earnings before taxes, adjusted for the impact of discrete quarterly items. For the three and nine months ended September 30, 2013, our effective tax rate was 29.7% and 25.9% respectively, compared with 40.4% and 31.7% for the same periods in 2012. The effective tax rate for the nine months ended September 30, 2012 reflects the nondeductibility of the purchase premium paid during that period related to the extinguishment of our convertible debt. In addition, the decrease in the effective tax rate for both periods presented reflects the impact of the discrete tax items discussed below. | |
During the three months ended September 30, 2013 and 2012, we recorded discrete tax charges of $1.3 million and $0.8 million, respectively, resulting from the impact of changes in the enacted tax rate in the United Kingdom on our previously-recorded deferred tax balances. In addition, during the third quarter of 2012, as a result of the finalization of estimates of foreign tax credits available with respect to a dividend from one of our foreign subsidiaries, we recorded a discrete tax charge of $1.0 million. | |
The effective tax rate for the nine month periods presented reflects the items mentioned above, as well as a $1.3 million discrete tax benefit related to the American Taxpayers Relief Act of 2012, which was signed into law in January 2013 and includes a retroactive reinstatement of the research and development tax credit to January 1, 2012. In addition, during the nine months ended September 30, 2012, we recorded a $0.3 million discrete tax charge associated with the legal restructuring of the ownership of our Puerto Rico operations. | |
Because we are a global organization, we and our subsidiaries file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. During 2012, the statute of limitations for the 2008 U.S. federal tax year lapsed, leaving tax years 2009 through 2012 open to examination. For U.S. state and local jurisdictions, tax years 2007 through 2012 are open to examination. We are also subject to examination in various foreign jurisdictions for tax years 2006 through 2012. | |
It is reasonably possible that, due to the expiration of statutes and the closing of tax audits, the liability for unrecognized tax benefits may be reduced by approximately $2.1 million during the next twelve months, which would favorably impact our effective tax rate. Accrued interest and penalties related to unrecognized tax benefits was $0.6 million and $0.5 million at September 30, 2013 and December 31, 2012, respectively. |
Derivative_Financial_Instrumen
Derivative Financial Instruments | 9 Months Ended | |||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||||||||||
Derivative Financial Instruments | ' | |||||||||||||||||
Derivative Financial Instruments | ||||||||||||||||||
Our ongoing business operations expose us to various risks such as fluctuating interest rates, foreign exchange rates and increasing commodity prices. To manage these market risks, we periodically enter into derivative financial instruments such as interest rate swaps, options and foreign exchange contracts for periods consistent with and for notional amounts equal to or less than the related underlying exposures. We do not purchase or hold any derivative financial instruments for speculation or trading purposes. All derivatives are recorded on the balance sheet at fair value. | ||||||||||||||||||
Interest Rate Risk | ||||||||||||||||||
At September 30, 2013, we had $41.7 million of outstanding borrowings under our variable-rate five-year term loan related to the purchase of our new corporate office and research building. In anticipation of this debt, we entered into a forward-start interest rate swap to hedge the variability in cash flows due to changes in the applicable interest rate over the stated period. Under this swap, we receive variable interest rate payments based on one-month London Interbank Offering Rates (“LIBOR”) plus a margin in return for making monthly fixed interest payments at 5.41%. We designated this swap as a cash flow hedge. | ||||||||||||||||||
We also have an interest rate swap agreement outstanding as of September 30, 2013 that is designated as a cash flow hedge to protect against volatility in the interest rate payable on $25.0 million of floating rate notes maturing on July 28, 2015 (“Series B Notes”). Under this swap, we receive variable interest rate payments based on three-month LIBOR in return for making quarterly fixed rate payments. Including the applicable margin, the interest rate swap agreement effectively fixes the interest rate payable on the Series B Notes at 5.51%. | ||||||||||||||||||
Foreign Exchange Rate Risk | ||||||||||||||||||
During 2012, we entered into several foreign currency hedge contracts that were designated as cash flow hedges of forecasted transactions denominated in foreign currencies, which are described in more detail below. | ||||||||||||||||||
We entered into a series of foreign currency contracts intended to hedge the currency risk associated with a portion of our forecasted Japanese Yen (“Yen”) denominated purchases of inventory from Daikyo Seiko Ltd. (“Daikyo”) made by West in the United States. As of September 30, 2013, there were three monthly contracts outstanding at ¥200.8 million ($2.5 million) each, for an aggregate notional amount of ¥602.3 million ($7.5 million). | ||||||||||||||||||
We also entered into a series of foreign currency contracts to hedge the currency risk associated with a portion of our forecasted U.S. dollar (“USD”) denominated inventory purchases made by certain European subsidiaries. As of September 30, 2013, there were three monthly contracts outstanding at an average monthly amount of $1.1 million, for an aggregate notional amount of $3.3 million. | ||||||||||||||||||
In addition, we entered into a series of foreign currency contracts to hedge the currency risk associated with a portion of our forecasted Yen-denominated inventory purchases made by certain European subsidiaries. As of September 30, 2013, there was one monthly contract outstanding for a notional amount of ¥65.0 million (approximately $0.7 million). | ||||||||||||||||||
Lastly, we entered into a series of foreign currency contracts to hedge the currency risk associated with a portion of our forecasted Euro-denominated sales of finished goods by one of our USD functional-currency subsidiaries. As of September 30, 2013, there were three monthly contracts outstanding at $1.4 million each, for an aggregate notional amount of $4.2 million. | ||||||||||||||||||
At September 30, 2013, a portion of our debt consists of borrowings denominated in currencies other than the U.S. dollar. We have designated our €61.1 million ($82.6 million) Euro note B and our €21.0 million ($28.4 million) Euro-denominated borrowings under our revolving credit facility as a hedge of our net investment in certain European subsidiaries. A cumulative foreign currency translation loss of $3.7 million pre-tax ($2.3 million after tax) on this debt was recorded within accumulated other comprehensive loss as of September 30, 2013. We have also designated our ¥500.0 million ($5.1 million) Yen-denominated borrowings under our revolving credit facility as a hedge of our net investment in a Japanese affiliate. At September 30, 2013, there was a cumulative foreign currency translation gain on this Yen-denominated debt of $0.3 million pre-tax ($0.2 million after tax) which was also included within accumulated other comprehensive loss. | ||||||||||||||||||
Commodity Price Risk | ||||||||||||||||||
Many of our Packaging Systems products are made from synthetic elastomers, which are derived from the petroleum refining process. We purchase the majority of our elastomers via long-term supply contracts, some of which contain clauses that provide for surcharges related to fluctuations in crude oil prices. The following economic hedges did not qualify for hedge accounting treatment since they did not meet the highly effective requirement at inception. | ||||||||||||||||||
In February 2013, we purchased a series of call options for a total of 58,000 barrels of crude oil to mitigate our exposure to such oil-based surcharges and protect operating cash flows with regard to a portion of our forecasted elastomer purchases during the months of July through December 2013. With these contracts we may benefit from a decline in crude oil prices, as there is no downward exposure other than the $0.1 million premium that we paid to purchase the contracts. | ||||||||||||||||||
During the nine months ended September 30, 2013, we recorded a $0.1 million loss in cost of goods and services sold related to these outstanding call options. During the nine months ended September 30, 2012, a loss of $0.1 million was recorded in cost of goods and services sold relating to 2012 crude-oil options. | ||||||||||||||||||
Effects of Derivative Instruments on Financial Position and Results of Operations | ||||||||||||||||||
Refer to Note 5, Fair Value Measurements, for the balance sheet location and fair values of our derivative instruments as of September 30, 2013 and December 31, 2012. | ||||||||||||||||||
The following tables summarize the effects of derivative instruments designated as hedges on other comprehensive income (“OCI”) and earnings, net of tax: | ||||||||||||||||||
Amount of Gain (Loss) Recognized in OCI for | Amount of Loss Reclassified from Accumulated OCI into Income for | Location of Loss Reclassified from Accumulated OCI into Income | ||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||||
Cash Flow Hedges: | ||||||||||||||||||
Foreign currency hedge contracts | $ | (0.2 | ) | $ | — | $ | — | $ | — | Net sales | ||||||||
Foreign currency hedge contracts | 0.1 | (0.2 | ) | 0.8 | — | Cost of goods and services sold | ||||||||||||
Interest rate swap contracts | (0.2 | ) | (0.4 | ) | 0.4 | 0.3 | Interest expense | |||||||||||
Forward treasury locks | — | — | 0.1 | — | Interest expense | |||||||||||||
Total | $ | (0.3 | ) | $ | (0.6 | ) | $ | 1.3 | $ | 0.3 | ||||||||
Net Investment Hedges: | ||||||||||||||||||
Foreign currency-denominated debt | $ | (2.5 | ) | $ | (2.2 | ) | $ | — | $ | — | Foreign exchange and other | |||||||
Total | $ | (2.5 | ) | $ | (2.2 | ) | $ | — | $ | — | ||||||||
Amount of Gain (Loss) Recognized in OCI for | Amount of Loss Reclassified from Accumulated OCI into Income for | Location of Loss Reclassified from Accumulated OCI into Income | ||||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||||
Cash Flow Hedges: | ||||||||||||||||||
Foreign currency hedge contracts | $ | (2.6 | ) | $ | 0.2 | $ | 2.3 | $ | — | Cost of goods and services sold | ||||||||
Interest rate swap contracts | 0.3 | (1.8 | ) | 1.2 | 1.8 | Interest expense | ||||||||||||
Forward treasury locks | — | (2.8 | ) | 0.2 | — | Interest expense | ||||||||||||
Total | $ | (2.3 | ) | $ | (4.4 | ) | $ | 3.7 | $ | 1.8 | ||||||||
Net Investment Hedges: | ||||||||||||||||||
Foreign currency-denominated debt | $ | (1.1 | ) | $ | 0.2 | $ | — | $ | — | Foreign exchange and other | ||||||||
Total | $ | (1.1 | ) | $ | 0.2 | $ | — | $ | — | |||||||||
For the three and nine month periods ended September 30, 2013 and 2012, there was no material ineffectiveness related to our cash flow and net investment hedges. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Fair Value Measurements | ' | |||||||||||||||
Fair Value Measurements | ||||||||||||||||
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The following fair value hierarchy classifies the inputs to valuation techniques used to measure fair value into one of three levels: | ||||||||||||||||
• | Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities. | |||||||||||||||
• | Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. | |||||||||||||||
• | Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions. | |||||||||||||||
The following tables present the assets and liabilities recorded at fair value on a recurring basis: | ||||||||||||||||
Balance at | Basis of Fair Value Measurements | |||||||||||||||
($ in millions) | September 30, | Level 1 | Level 2 | Level 3 | ||||||||||||
2013 | ||||||||||||||||
Assets: | ||||||||||||||||
Short-term investments | $ | 7.5 | $ | 7.5 | $ | — | $ | — | ||||||||
Deferred compensation assets | 5.2 | 5.2 | — | — | ||||||||||||
$ | 12.7 | $ | 12.7 | $ | — | $ | — | |||||||||
Liabilities: | ||||||||||||||||
Contingent consideration | $ | 3.8 | $ | — | $ | — | $ | 3.8 | ||||||||
Deferred compensation liabilities | 9.8 | 9.8 | — | — | ||||||||||||
Interest rate swap contracts | 6.3 | — | 6.3 | — | ||||||||||||
Foreign currency contracts | 1.8 | — | 1.8 | — | ||||||||||||
$ | 21.7 | $ | 9.8 | $ | 8.1 | $ | 3.8 | |||||||||
Balance at | Basis of Fair Value Measurements | |||||||||||||||
($ in millions) | December 31, | Level 1 | Level 2 | Level 3 | ||||||||||||
2012 | ||||||||||||||||
Assets: | ||||||||||||||||
Short-term investments | $ | 12.4 | $ | 12.4 | $ | — | $ | — | ||||||||
Deferred compensation assets | 4 | 4 | — | — | ||||||||||||
$ | 16.4 | $ | 16.4 | $ | — | $ | — | |||||||||
Liabilities: | ||||||||||||||||
Contingent consideration | $ | 3.3 | $ | — | $ | — | $ | 3.3 | ||||||||
Deferred compensation liabilities | 7.6 | 7.6 | — | — | ||||||||||||
Interest rate swap contracts | 8.6 | — | 8.6 | — | ||||||||||||
Foreign currency contracts | 1.4 | — | 1.4 | — | ||||||||||||
$ | 20.9 | $ | 7.6 | $ | 10 | $ | 3.3 | |||||||||
Short-term investments, which are comprised of certificates of deposit and mutual funds, are valued using a market approach based on quoted market prices in an active market. Deferred compensation assets are included within other noncurrent assets and are also valued using a market approach based on quoted market prices in an active market. The fair value of our contingent consideration is included within other current liabilities and other long-term liabilities and is discussed further in the section related to Level 3 measurements. The fair value of our foreign currency contracts, included within other current liabilities, is valued using an income approach based on quoted forward foreign exchange rates and spot rates at the reporting date. The fair value of deferred compensation liabilities is based on quoted prices of the underlying employees’ investment selections and is included within other long-term liabilities. Interest rate swaps, included within other long-term liabilities, are valued based on the terms of the contract and observable market inputs (i.e., LIBOR, Eurodollar synthetic forwards and swap spreads). Refer to Note 4, Derivative Financial Instruments, for further discussion of our derivatives. | ||||||||||||||||
Level 3 Fair Value Measurements | ||||||||||||||||
The fair value of the SmartDose contingent consideration was determined at the acquisition date using a probability-weighted income approach, and is revalued at each reporting date or more frequently if circumstances dictate. Changes in the fair value of this obligation are recorded as income or expense within restructuring and other items in our condensed consolidated statements of income. The significant unobservable inputs used in the fair value measurement of our contingent consideration are the sales projections and the discount rate used in the calculation. Significant increases or decreases in either of those inputs in isolation would result in a significantly lower or higher fair value measurement. As development and commercialization of SmartDose progresses, we may need to update the sales projections and the discount rate used. This could result in a material increase or decrease to the contingent consideration liability. | ||||||||||||||||
The following table provides a summary of changes in our Level 3 fair value measurements: | ||||||||||||||||
Nine Months Ended | ||||||||||||||||
September 30, | ||||||||||||||||
2013 | 2012 | |||||||||||||||
Beginning Balance | $ | 3.3 | $ | 2.1 | ||||||||||||
Increase in fair value recorded in earnings | 0.5 | 0.9 | ||||||||||||||
Ending Balance | $ | 3.8 | $ | 3 | ||||||||||||
Refer to Note 2, Restructuring and Other Items, for further discussion of our acquisition-related contingency. | ||||||||||||||||
Other Financial Instruments | ||||||||||||||||
We believe that the carrying amounts of our cash and cash equivalents, accounts receivable and short-term borrowings approximate their fair values due to their near-term maturities. | ||||||||||||||||
Quoted market prices are used to estimate the fair value of publicly traded long-term debt. The fair value of debt that is not quoted on an exchange is estimated using a discounted cash flow method based on interest rates that are currently available to us for debt issuances with similar terms and maturities. At September 30, 2013, the estimated fair value of long-term debt was $383.5 million compared to a carrying amount of $381.1 million. At December 31, 2012, the estimated fair value of long-term debt was $386.0 million and the carrying amount was $378.8 million. |
Inventories
Inventories | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories | ||||||||
Inventories are valued at the lower of cost (on a first-in, first-out basis) or market. Inventory balances were as follows: | ||||||||
($ in millions) | September 30, | December 31, | ||||||
2013 | 2012 | |||||||
Finished goods | $ | 76.7 | $ | 70.9 | ||||
Work in process | 28.1 | 23.6 | ||||||
Raw materials | 71.9 | 67.7 | ||||||
$ | 176.7 | $ | 162.2 | |||||
Debt
Debt | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Debt | ' | |||||||
Debt | ||||||||
The following table summarizes our long-term debt obligations, net of current maturities: | ||||||||
($ in millions) | September 30, | December 31, | ||||||
2013 | 2012 | |||||||
Euro note A, due 2013 | $ | — | $ | 26.9 | ||||
Term loan, due 2014 | 0.1 | 0.2 | ||||||
Series B floating rate notes, due 2015 | 25 | 25 | ||||||
Euro note B, due 2016 | 82.6 | 80.8 | ||||||
Capital leases, due through 2016 | 0.5 | 0.7 | ||||||
Revolving credit facility, due 2017 | 80.3 | 71.5 | ||||||
Term loan, due 2018 | 41.7 | 35.3 | ||||||
Note payable, due 2019 | 0.4 | — | ||||||
Series A notes, due 2022 | 42 | 42 | ||||||
Series B notes, due 2024 | 53 | 53 | ||||||
Series C notes, due 2027 | 73 | 73 | ||||||
Convertible debt, due 2047 | 1.4 | 3.1 | ||||||
400 | 411.5 | |||||||
Less: current portion of long-term debt | 18.9 | 32.7 | ||||||
$ | 381.1 | $ | 378.8 | |||||
Please refer to Note 11, Debt, to the consolidated financial statements in our 2012 Annual Report for additional details regarding our debt agreements. | ||||||||
During the first quarter of 2013, we used a portion of our multi-currency revolving credit facility to repay our Euro note A that matured on February 27, 2013. At September 30, 2013, we had $80.3 million in outstanding borrowings under this facility, of which $5.1 million was denominated in Yen, $28.4 million in Euros and the remainder in USD. At September 30, 2013, $16.8 million of the outstanding borrowings was classified as current and $63.5 million was classified as long-term. Of the total amount outstanding as of December 31, 2012, $5.7 million was classified as current and $65.8 million was classified as long-term. | ||||||||
In February 2013, upon settlement of our new corporate office and research building, we borrowed $42.8 million under a $50.0 million revolving credit facility, which was immediately converted to a five-year term loan due January 2018. A portion of the loan was used to pay the $35.3 million in outstanding obligations at December 31, 2012 related to the construction and acquisition of this new building. Borrowings under the loan bear interest at a variable rate equal to one-month LIBOR plus a margin of 1.50% percentage points. At September 30, 2013, $41.7 million was outstanding under this loan, of which $2.0 million was classified as current. Please refer to Note 4, Derivative Financial Instruments, for a discussion of the interest-rate swap agreement associated with this loan. | ||||||||
In addition, during the nine months ended September 30, 2013, we repurchased $1.7 million in aggregate principal amount of our 4.00% Convertible Junior Subordinated Debentures due 2047 (the “Convertible Debentures”). As a result, we recognized a pre-tax loss on debt extinguishment of $0.2 million, the majority of which represented the premium over par value. Following the repurchase, $1.4 million principal amount of Convertible Debentures remains outstanding. |
Net_Income_Per_Share
Net Income Per Share | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Net Income Per Share | ' | |||||||||||||||
Net Income Per Share | ||||||||||||||||
The following table reconciles net income and shares used in the calculation of basic net income per share to those used for diluted net income per share: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income, as reported, for basic net income per share | $ | 26.8 | $ | 14.8 | $ | 88.7 | $ | 59.6 | ||||||||
Plus: interest expense on convertible debt, net of tax | — | — | — | 1.9 | ||||||||||||
Net income for diluted net income per share | $ | 26.8 | $ | 14.8 | $ | 88.7 | $ | 61.5 | ||||||||
Weighted average common shares outstanding | 69.8 | 68.3 | 69.4 | 68 | ||||||||||||
Dilutive effect of stock options, stock appreciation rights and performance share awards, based on the treasury stock method | 1.6 | 1 | 1.4 | 0.9 | ||||||||||||
Assumed conversion of convertible debt, based on the if-converted method | — | 0.1 | 0.1 | 3.4 | ||||||||||||
Weighted average shares assuming dilution | 71.4 | 69.4 | 70.9 | 72.3 | ||||||||||||
For the three month period ended September 30, 2013, the number of shares from stock-based compensation plans not included in the computation of diluted net income per share, because their impact was antidilutive, was immaterial. During the nine months ended September 30, 2013, there were 0.7 million antidilutive shares excluded from the computation. There were 0.1 million and 2.9 million antidilutive shares outstanding during the three and nine month periods ended September 30, 2012, respectively. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Loss | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Equity [Abstract] | ' | |||||||||||||||
Accumulated Other Comprehensive Loss | ' | |||||||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||||||
The following table presents the changes in the components of accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2013: | ||||||||||||||||
($ in millions) | Losses on | Unrealized gains | Defined benefit | Foreign | Total | |||||||||||
cash flow | on investment | pension and other | currency | |||||||||||||
hedges | securities | postretirement plans | translation | |||||||||||||
Balance, December 31, 2012 | $ | (9.0 | ) | $ | 0.8 | $ | (84.9 | ) | $ | 17.2 | $ | (75.9 | ) | |||
Other comprehensive (loss) income before reclassifications | (2.3 | ) | — | 6.1 | (4.6 | ) | (0.8 | ) | ||||||||
Amounts reclassified out | 3.7 | — | 3.5 | — | 7.2 | |||||||||||
Other comprehensive income (loss), net of tax | 1.4 | — | 9.6 | (4.6 | ) | 6.4 | ||||||||||
Balance, September 30, 2013 | $ | (7.6 | ) | $ | 0.8 | $ | (75.3 | ) | $ | 12.6 | $ | (69.5 | ) | |||
During the third quarter of 2013, we adjusted our U.S. postretirement medical plan liability as a result of a decrease in the eligible participants in the plan, lower-than-expected plan participation and better-than-expected claims experience. This change in estimate resulted in a pre-tax actuarial gain of $10.1 million, which was recorded within accumulated other comprehensive loss and which will be recognized over the average remaining service period of active plan participants. | ||||||||||||||||
A summary of the reclassifications out of accumulated other comprehensive loss is presented in the following table ($ in millions): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
Detail of components | 2013 | 2013 | Location on Statement of Income | |||||||||||||
Losses on cash flow hedges: | ||||||||||||||||
Foreign currency contracts | $ | (1.4 | ) | $ | (3.8 | ) | Cost of goods and services sold | |||||||||
Interest rate swap contracts | (0.7 | ) | (1.9 | ) | Interest expense | |||||||||||
Forward treasury locks | — | (0.3 | ) | Interest expense | ||||||||||||
Total before tax | (2.1 | ) | (6.0 | ) | ||||||||||||
Tax expense | 0.8 | 2.3 | ||||||||||||||
Net of tax | $ | (1.3 | ) | $ | (3.7 | ) | ||||||||||
Amortization of defined benefit pension and other postretirement plans: | ||||||||||||||||
Transition obligation | $ | — | $ | (0.1 | ) | (a) | ||||||||||
Prior service cost | 0.3 | 1 | (a) | |||||||||||||
Actuarial losses | (1.7 | ) | (6.4 | ) | (a) | |||||||||||
Total before tax | (1.4 | ) | (5.5 | ) | ||||||||||||
Tax expense | 0.5 | 2 | ||||||||||||||
Net of tax | $ | (0.9 | ) | $ | (3.5 | ) | ||||||||||
Total reclassifications for the period, net of tax | $ | (2.2 | ) | $ | (7.2 | ) | ||||||||||
(a) These components are included in the computation of net periodic benefit cost. Refer to Note 11, Benefit Plans, for additional details. |
StockBased_Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' |
Stock-Based Compensation | ' |
Stock-Based Compensation | |
At September 30, 2013, there were 5,932,577 shares remaining in the 2011 Omnibus Incentive Compensation Plan (the “2011 Plan”) for future grants. The 2011 Plan provides for the granting of stock options, stock appreciation rights, restricted stock awards and performance awards to employees and non-employee directors. The Compensation Committee of the Board of Directors determines the terms and conditions of awards to be granted. Vesting requirements vary by award. | |
During the nine months ended September 30, 2013, we granted 922,348 stock options at a weighted average exercise price of $29.71 per share based on the grant-date fair value of our stock to key employees under the 2011 Plan. Stock options granted to employees vest in equal annual increments over four years of continuous service. All awards expire ten years from the date of grant. The weighted average grant date fair value of options granted was $5.73 per share as determined by the Black-Scholes option valuation model using the following weighted average assumptions: a risk-free interest rate of 0.89%; expected life of 6 years based on prior experience; stock volatility of 22.5% based on historical data; and a dividend yield of 1.3%. Stock option expense is recognized over the vesting period, net of forfeitures. | |
In addition, during the nine months ended September 30, 2013, we granted 176,952 performance-vesting share (“PVS”) awards at a weighted grant-date fair value of $29.71 per share to key employees under the 2011 Plan. Each PVS award entitles the holder to one share of our common stock if the annual growth rate of revenue and return on invested capital targets are achieved over a three-year performance period. The actual payout may vary from 0% to 200% of an employee’s targeted award. The fair value of PVS awards was based on the market price of our stock at the grant date and is recognized as an expense over the performance period, adjusted for estimated target outcomes and net of forfeitures. | |
Total stock-based compensation expense was $5.2 million and $15.6 million for the three and nine months ended September 30, 2013, respectively. For the three and nine months ended September 30, 2012, total stock-based compensation expense was $4.4 million and $11.8 million, respectively. |
Benefit_Plans
Benefit Plans | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | ' | |||||||||||||||||||||||
Benefit Plans | ' | |||||||||||||||||||||||
Benefit Plans | ||||||||||||||||||||||||
The components of net periodic benefit cost for the three months ended September 30 were as follows ($ in millions): | ||||||||||||||||||||||||
Pension benefits | Other retirement benefits | Total | ||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
Service cost | $ | 2.3 | $ | 2.1 | $ | 0.1 | $ | 0.3 | $ | 2.4 | $ | 2.4 | ||||||||||||
Interest cost | 3.6 | 3.7 | — | 0.3 | 3.6 | 4 | ||||||||||||||||||
Expected return on assets | (4.3 | ) | (4.0 | ) | — | — | (4.3 | ) | (4.0 | ) | ||||||||||||||
Amortization of prior service credit | (0.3 | ) | (0.3 | ) | — | — | (0.3 | ) | (0.3 | ) | ||||||||||||||
Recognized actuarial losses | 2.2 | 1.9 | (0.5 | ) | — | 1.7 | 1.9 | |||||||||||||||||
Net periodic benefit cost | $ | 3.5 | $ | 3.4 | $ | (0.4 | ) | $ | 0.6 | $ | 3.1 | $ | 4 | |||||||||||
Pension benefits | Other retirement benefits | Total | ||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
U.S. plans | $ | 2.7 | $ | 2.7 | $ | (0.4 | ) | $ | 0.6 | $ | 2.3 | $ | 3.3 | |||||||||||
International plans | 0.8 | 0.7 | — | — | 0.8 | 0.7 | ||||||||||||||||||
Net periodic benefit cost | $ | 3.5 | $ | 3.4 | $ | (0.4 | ) | $ | 0.6 | $ | 3.1 | $ | 4 | |||||||||||
The components of net periodic benefit cost for the nine months ended September 30 were as follows ($ in millions): | ||||||||||||||||||||||||
Pension benefits | Other retirement benefits | Total | ||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
Service cost | $ | 7.3 | $ | 6.7 | $ | 0.8 | $ | 1 | $ | 8.1 | $ | 7.7 | ||||||||||||
Interest cost | 11 | 11.4 | 0.5 | 0.7 | 11.5 | 12.1 | ||||||||||||||||||
Expected return on assets | (12.9 | ) | (12.2 | ) | — | — | (12.9 | ) | (12.2 | ) | ||||||||||||||
Amortization of transition obligation | 0.1 | 0.1 | — | — | 0.1 | 0.1 | ||||||||||||||||||
Amortization of prior service credit | (1.0 | ) | (1.1 | ) | — | 0.1 | (1.0 | ) | (1.0 | ) | ||||||||||||||
Recognized actuarial losses | 6.9 | 6.2 | (0.5 | ) | — | 6.4 | 6.2 | |||||||||||||||||
Net periodic benefit cost | $ | 11.4 | $ | 11.1 | $ | 0.8 | $ | 1.8 | $ | 12.2 | $ | 12.9 | ||||||||||||
Pension benefits | Other retirement benefits | Total | ||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
U.S. plans | $ | 8.9 | $ | 9.1 | $ | 0.8 | $ | 1.8 | $ | 9.7 | $ | 10.9 | ||||||||||||
International plans | 2.5 | 2 | — | — | 2.5 | 2 | ||||||||||||||||||
Net periodic benefit cost | $ | 11.4 | $ | 11.1 | $ | 0.8 | $ | 1.8 | $ | 12.2 | $ | 12.9 | ||||||||||||
Segment_Information
Segment Information | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Segment Information | ' | |||||||||||||||
Segment Information | ||||||||||||||||
Our business operations are organized into two reportable segments, which are aligned with the underlying markets and customers they serve. Our reportable segments are the Pharmaceutical Packaging Systems segment (“Packaging Systems”) and Delivery Systems. Packaging Systems develops, manufactures and sells primary packaging components and systems for injectable drug delivery, including stoppers and seals for vials, closures and other components used in syringe, intravenous and blood collection systems, and prefillable syringe components. Delivery Systems develops, manufactures and sells safety and administration systems, multi-component systems for drug administration, and a variety of custom contract-manufacturing solutions targeted to the healthcare and consumer-products industries. In addition, Delivery Systems is responsible for the continued development and commercialization of our line of proprietary, multi-component systems for injectable drug administration and other healthcare applications. | ||||||||||||||||
Segment operating profit excludes general corporate costs, which include executive and director compensation, stock-based compensation, adjustments to annual incentive plan expense for over- or under-attainment of targets, certain pension and other retirement benefit costs, and other corporate facilities and administrative expenses not allocated to the segments. Also excluded are items that management considers not representative of ongoing operations. Such items are referred to as other unallocated items and generally include restructuring and related charges, certain asset impairments and other specifically-identified income or expense items. | ||||||||||||||||
The following table presents information about our reportable segments, reconciled to consolidated totals: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Net sales: | ||||||||||||||||
Packaging Systems | $ | 251.5 | $ | 215.9 | $ | 754.5 | $ | 687.4 | ||||||||
Delivery Systems | 90.8 | 88.2 | 272.3 | 258.1 | ||||||||||||
Intersegment sales | (0.5 | ) | (0.3 | ) | (1.1 | ) | (0.6 | ) | ||||||||
Total net sales | $ | 341.8 | $ | 303.8 | $ | 1,025.70 | $ | 944.9 | ||||||||
Operating profit: | ||||||||||||||||
Packaging Systems | $ | 54.6 | $ | 39.2 | $ | 170 | $ | 143.4 | ||||||||
Delivery Systems | (0.1 | ) | 4.7 | 3.4 | 12.5 | |||||||||||
Corporate | (14.8 | ) | (16.0 | ) | (47.9 | ) | (46.2 | ) | ||||||||
Other unallocated items | — | (1.6 | ) | — | (6.1 | ) | ||||||||||
Total operating profit | $ | 39.7 | $ | 26.3 | $ | 125.5 | $ | 103.6 | ||||||||
Loss on debt extinguishment | — | — | 0.2 | 11.6 | ||||||||||||
Interest expense | 4.4 | 4.4 | 13.1 | 13.2 | ||||||||||||
Interest income | 0.4 | 0.5 | 1.4 | 1.5 | ||||||||||||
Income before income taxes | $ | 35.7 | $ | 22.4 | $ | 113.6 | $ | 80.3 | ||||||||
The intersegment sales elimination, which is required for the presentation of consolidated net sales, represents the elimination of components sold between our segments. | ||||||||||||||||
During the nine months ended September 30, 2013 and 2012, in connection with the repurchase of our Convertible Debentures, we recognized a pre-tax loss on debt extinguishment of $0.2 million and $11.6 million, respectively. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Commitments and Contingencies | |
From time to time, we are involved in product liability matters and other legal proceedings and claims generally incidental to our normal business activities. We accrue for loss contingencies when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. While the outcome of current proceedings cannot be accurately predicted, we believe their ultimate resolution should not have a material adverse effect on our business, financial condition, results of operations or liquidity. | |
There have been no significant changes to the commitments and contingencies included in our 2012 Annual Report. |
New_Accounting_Standards
New Accounting Standards | 9 Months Ended |
Sep. 30, 2013 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | ' |
New Accounting Standards | ' |
New Accounting Standards | |
Recently Adopted Standards | |
In July 2013, the Financial Accounting Standards Board ("FASB") issued amended guidance to permit the Federal Funds Effective Swap Rate (or Overnight Index Swap Rate) to be used as a U.S. benchmark interest rate for hedge accounting purposes under the derivatives and hedging guidance. The guidance also removes the restriction on using different benchmark rates for similar hedges. The amendments were effective for us immediately upon issuance and will be applied prospectively to qualifying new or re-designated hedging relationships entered into on or after July 17, 2013. This adoption did not have an impact on our financial statements. | |
In February 2013, the FASB issued guidance for the reporting of amounts reclassified out of accumulated other comprehensive income ("AOCI"). The guidance does not change the current requirements for reporting net income or other comprehensive income in financial statements; however, it requires an entity to provide information about the amounts reclassified out of AOCI by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. We adopted this guidance as of January 1, 2013, on a prospective basis. This adoption did not have a material impact on our financial statements. Please refer to Note 9, Accumulated Other Comprehensive Loss, for additional details. | |
In July 2012, the FASB issued guidance for the impairment testing of indefinite-lived intangible assets. The guidance permits an entity to first assess qualitative factors to determine whether it is more-likely-than-not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform a quantitative impairment test. This guidance was effective for us as of January 1, 2013 and will be considered when performing our annual impairment testing. Management believes that the adoption of this guidance will not have a material impact on our financial statements. | |
Standards Issued Not Yet Adopted | |
In July 2013, the FASB issued revised guidance to address the diversity in practice related to the financial statement presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013. Management believes that the adoption of this guidance will not have a material impact on our financial statements. | |
In March 2013, the FASB issued guidance that clarifies the application of U.S. GAAP to the release of cumulative translation adjustments related to changes of ownership in or within foreign entities, including step acquisitions. This guidance is effective for annual reporting periods beginning on or after December 15, 2013, and subsequent interim periods. Management believes that the adoption of this guidance will not have an impact on our financial statements. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation: The condensed consolidated financial statements included in this report are unaudited and have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial reporting and Securities and Exchange Commission (“SEC”) regulations. The year-end condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. In the opinion of management, these financial statements include all adjustments, which are of a normal recurring nature, necessary for a fair statement of the financial position, results of operations, cash flows and the change in equity for the periods presented. The condensed consolidated financial statements for the three and nine month periods ended September 30, 2013 should be read in conjunction with the consolidated financial statements and notes thereto of West Pharmaceutical Services, Inc. (which may be referred to as “West”, “the Company”, “we”, “us” or “our”), appearing in our Annual Report on Form 10-K for the year ended December 31, 2012 (“2012 Annual Report”). The results of operations for any interim period are not necessarily indicative of results for the full year. | |
Stock Split | ' |
Stock Split: On August 1, 2013, our Board of Directors approved a two-for-one stock split of our outstanding shares of common stock, effected in the form of a stock dividend. The record date for the stock split was September 12, 2013, and the share distribution occurred on September 26, 2013. All share and per share amounts presented in the accompanying condensed consolidated financial statements and related notes have been retroactively adjusted to reflect the impact of this stock split. | |
Reclassifications | ' |
Reclassifications: Certain reclassifications were made to prior period financial statements to conform to the current year presentation. | |
New Accounting Standards | ' |
Recently Adopted Standards | |
In July 2013, the Financial Accounting Standards Board ("FASB") issued amended guidance to permit the Federal Funds Effective Swap Rate (or Overnight Index Swap Rate) to be used as a U.S. benchmark interest rate for hedge accounting purposes under the derivatives and hedging guidance. The guidance also removes the restriction on using different benchmark rates for similar hedges. The amendments were effective for us immediately upon issuance and will be applied prospectively to qualifying new or re-designated hedging relationships entered into on or after July 17, 2013. This adoption did not have an impact on our financial statements. | |
In February 2013, the FASB issued guidance for the reporting of amounts reclassified out of accumulated other comprehensive income ("AOCI"). The guidance does not change the current requirements for reporting net income or other comprehensive income in financial statements; however, it requires an entity to provide information about the amounts reclassified out of AOCI by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of AOCI by the respective line items of net income, but only if the amount reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under U.S. GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under U.S. GAAP that provide additional detail about those amounts. We adopted this guidance as of January 1, 2013, on a prospective basis. This adoption did not have a material impact on our financial statements. Please refer to Note 9, Accumulated Other Comprehensive Loss, for additional details. | |
In July 2012, the FASB issued guidance for the impairment testing of indefinite-lived intangible assets. The guidance permits an entity to first assess qualitative factors to determine whether it is more-likely-than-not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform a quantitative impairment test. This guidance was effective for us as of January 1, 2013 and will be considered when performing our annual impairment testing. Management believes that the adoption of this guidance will not have a material impact on our financial statements. | |
Standards Issued Not Yet Adopted | |
In July 2013, the FASB issued revised guidance to address the diversity in practice related to the financial statement presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013. Management believes that the adoption of this guidance will not have a material impact on our financial statements. | |
In March 2013, the FASB issued guidance that clarifies the application of U.S. GAAP to the release of cumulative translation adjustments related to changes of ownership in or within foreign entities, including step acquisitions. This guidance is effective for annual reporting periods beginning on or after December 15, 2013, and subsequent interim periods. Management believes that the adoption of this guidance will not have an impact on our financial statements. |
Restructuring_and_Other_Items_
Restructuring and Other Items (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Restructuring and Other Items [Abstract] | ' | |||||||||||||||
Schedule of restructuring and other items | ' | |||||||||||||||
Restructuring and other items consisted of: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Restructuring and related charges (reversals): | ||||||||||||||||
Severance and post-employment benefits | $ | — | $ | (1.1 | ) | $ | — | $ | (1.3 | ) | ||||||
Impairments and asset write-offs | — | 2 | — | 2.4 | ||||||||||||
Other restructuring charges | — | 0.2 | — | 0.7 | ||||||||||||
Total restructuring and related charges | — | 1.1 | — | 1.8 | ||||||||||||
Impairment charge | — | — | — | 3.4 | ||||||||||||
Development income | (0.4 | ) | (0.4 | ) | (1.2 | ) | (4.2 | ) | ||||||||
Acquisition-related contingencies | 0.3 | 0.5 | 0.5 | 0.9 | ||||||||||||
Foreign exchange and other | 0.2 | 1 | 0.2 | 0.6 | ||||||||||||
Total restructuring and other items | $ | 0.1 | $ | 2.2 | $ | (0.5 | ) | $ | 2.5 | |||||||
Activity related to restructuring obligations | ' | |||||||||||||||
The following table presents activity related to our restructuring obligations: | ||||||||||||||||
($ in millions) | Severance | |||||||||||||||
and benefits | ||||||||||||||||
Balance, December 31, 2012 | $ | 2.8 | ||||||||||||||
Cash payments | (2.7 | ) | ||||||||||||||
Balance, September 30, 2013 | $ | 0.1 | ||||||||||||||
Derivative_Financial_Instrumen1
Derivative Financial Instruments (Tables) | 9 Months Ended | |||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ' | |||||||||||||||||
Effects of Derivative Instruments on Other Comprehensive Income ('OCI') and earnings | ' | |||||||||||||||||
The following tables summarize the effects of derivative instruments designated as hedges on other comprehensive income (“OCI”) and earnings, net of tax: | ||||||||||||||||||
Amount of Gain (Loss) Recognized in OCI for | Amount of Loss Reclassified from Accumulated OCI into Income for | Location of Loss Reclassified from Accumulated OCI into Income | ||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||||
Cash Flow Hedges: | ||||||||||||||||||
Foreign currency hedge contracts | $ | (0.2 | ) | $ | — | $ | — | $ | — | Net sales | ||||||||
Foreign currency hedge contracts | 0.1 | (0.2 | ) | 0.8 | — | Cost of goods and services sold | ||||||||||||
Interest rate swap contracts | (0.2 | ) | (0.4 | ) | 0.4 | 0.3 | Interest expense | |||||||||||
Forward treasury locks | — | — | 0.1 | — | Interest expense | |||||||||||||
Total | $ | (0.3 | ) | $ | (0.6 | ) | $ | 1.3 | $ | 0.3 | ||||||||
Net Investment Hedges: | ||||||||||||||||||
Foreign currency-denominated debt | $ | (2.5 | ) | $ | (2.2 | ) | $ | — | $ | — | Foreign exchange and other | |||||||
Total | $ | (2.5 | ) | $ | (2.2 | ) | $ | — | $ | — | ||||||||
Amount of Gain (Loss) Recognized in OCI for | Amount of Loss Reclassified from Accumulated OCI into Income for | Location of Loss Reclassified from Accumulated OCI into Income | ||||||||||||||||
Nine Months Ended | Nine Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||||
Cash Flow Hedges: | ||||||||||||||||||
Foreign currency hedge contracts | $ | (2.6 | ) | $ | 0.2 | $ | 2.3 | $ | — | Cost of goods and services sold | ||||||||
Interest rate swap contracts | 0.3 | (1.8 | ) | 1.2 | 1.8 | Interest expense | ||||||||||||
Forward treasury locks | — | (2.8 | ) | 0.2 | — | Interest expense | ||||||||||||
Total | $ | (2.3 | ) | $ | (4.4 | ) | $ | 3.7 | $ | 1.8 | ||||||||
Net Investment Hedges: | ||||||||||||||||||
Foreign currency-denominated debt | $ | (1.1 | ) | $ | 0.2 | $ | — | $ | — | Foreign exchange and other | ||||||||
Total | $ | (1.1 | ) | $ | 0.2 | $ | — | $ | — | |||||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Schedule of assets and liabilities measured at fair value on a recurring basis | ' | |||||||||||||||
The following tables present the assets and liabilities recorded at fair value on a recurring basis: | ||||||||||||||||
Balance at | Basis of Fair Value Measurements | |||||||||||||||
($ in millions) | September 30, | Level 1 | Level 2 | Level 3 | ||||||||||||
2013 | ||||||||||||||||
Assets: | ||||||||||||||||
Short-term investments | $ | 7.5 | $ | 7.5 | $ | — | $ | — | ||||||||
Deferred compensation assets | 5.2 | 5.2 | — | — | ||||||||||||
$ | 12.7 | $ | 12.7 | $ | — | $ | — | |||||||||
Liabilities: | ||||||||||||||||
Contingent consideration | $ | 3.8 | $ | — | $ | — | $ | 3.8 | ||||||||
Deferred compensation liabilities | 9.8 | 9.8 | — | — | ||||||||||||
Interest rate swap contracts | 6.3 | — | 6.3 | — | ||||||||||||
Foreign currency contracts | 1.8 | — | 1.8 | — | ||||||||||||
$ | 21.7 | $ | 9.8 | $ | 8.1 | $ | 3.8 | |||||||||
Balance at | Basis of Fair Value Measurements | |||||||||||||||
($ in millions) | December 31, | Level 1 | Level 2 | Level 3 | ||||||||||||
2012 | ||||||||||||||||
Assets: | ||||||||||||||||
Short-term investments | $ | 12.4 | $ | 12.4 | $ | — | $ | — | ||||||||
Deferred compensation assets | 4 | 4 | — | — | ||||||||||||
$ | 16.4 | $ | 16.4 | $ | — | $ | — | |||||||||
Liabilities: | ||||||||||||||||
Contingent consideration | $ | 3.3 | $ | — | $ | — | $ | 3.3 | ||||||||
Deferred compensation liabilities | 7.6 | 7.6 | — | — | ||||||||||||
Interest rate swap contracts | 8.6 | — | 8.6 | — | ||||||||||||
Foreign currency contracts | 1.4 | — | 1.4 | — | ||||||||||||
$ | 20.9 | $ | 7.6 | $ | 10 | $ | 3.3 | |||||||||
Summary of changes in Level 3 fair value measurements | ' | |||||||||||||||
The following table provides a summary of changes in our Level 3 fair value measurements: | ||||||||||||||||
Nine Months Ended | ||||||||||||||||
September 30, | ||||||||||||||||
2013 | 2012 | |||||||||||||||
Beginning Balance | $ | 3.3 | $ | 2.1 | ||||||||||||
Increase in fair value recorded in earnings | 0.5 | 0.9 | ||||||||||||||
Ending Balance | $ | 3.8 | $ | 3 | ||||||||||||
Inventories_Tables
Inventories (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Inventory Disclosure [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories are valued at the lower of cost (on a first-in, first-out basis) or market. Inventory balances were as follows: | ||||||||
($ in millions) | September 30, | December 31, | ||||||
2013 | 2012 | |||||||
Finished goods | $ | 76.7 | $ | 70.9 | ||||
Work in process | 28.1 | 23.6 | ||||||
Raw materials | 71.9 | 67.7 | ||||||
$ | 176.7 | $ | 162.2 | |||||
Debt_Tables
Debt (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Long-term debt obligations , net of current maturities | ' | |||||||
The following table summarizes our long-term debt obligations, net of current maturities: | ||||||||
($ in millions) | September 30, | December 31, | ||||||
2013 | 2012 | |||||||
Euro note A, due 2013 | $ | — | $ | 26.9 | ||||
Term loan, due 2014 | 0.1 | 0.2 | ||||||
Series B floating rate notes, due 2015 | 25 | 25 | ||||||
Euro note B, due 2016 | 82.6 | 80.8 | ||||||
Capital leases, due through 2016 | 0.5 | 0.7 | ||||||
Revolving credit facility, due 2017 | 80.3 | 71.5 | ||||||
Term loan, due 2018 | 41.7 | 35.3 | ||||||
Note payable, due 2019 | 0.4 | — | ||||||
Series A notes, due 2022 | 42 | 42 | ||||||
Series B notes, due 2024 | 53 | 53 | ||||||
Series C notes, due 2027 | 73 | 73 | ||||||
Convertible debt, due 2047 | 1.4 | 3.1 | ||||||
400 | 411.5 | |||||||
Less: current portion of long-term debt | 18.9 | 32.7 | ||||||
$ | 381.1 | $ | 378.8 | |||||
Net_Income_Per_Share_Tables
Net Income Per Share (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Earnings Per Share [Abstract] | ' | |||||||||||||||
Net income and shares used in basic and diluted net income per share | ' | |||||||||||||||
The following table reconciles net income and shares used in the calculation of basic net income per share to those used for diluted net income per share: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Net income, as reported, for basic net income per share | $ | 26.8 | $ | 14.8 | $ | 88.7 | $ | 59.6 | ||||||||
Plus: interest expense on convertible debt, net of tax | — | — | — | 1.9 | ||||||||||||
Net income for diluted net income per share | $ | 26.8 | $ | 14.8 | $ | 88.7 | $ | 61.5 | ||||||||
Weighted average common shares outstanding | 69.8 | 68.3 | 69.4 | 68 | ||||||||||||
Dilutive effect of stock options, stock appreciation rights and performance share awards, based on the treasury stock method | 1.6 | 1 | 1.4 | 0.9 | ||||||||||||
Assumed conversion of convertible debt, based on the if-converted method | — | 0.1 | 0.1 | 3.4 | ||||||||||||
Weighted average shares assuming dilution | 71.4 | 69.4 | 70.9 | 72.3 | ||||||||||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Equity [Abstract] | ' | |||||||||||||||
Components of Accumulated Other Comprehensive Loss | ' | |||||||||||||||
The following table presents the changes in the components of accumulated other comprehensive loss, net of tax, for the nine months ended September 30, 2013: | ||||||||||||||||
($ in millions) | Losses on | Unrealized gains | Defined benefit | Foreign | Total | |||||||||||
cash flow | on investment | pension and other | currency | |||||||||||||
hedges | securities | postretirement plans | translation | |||||||||||||
Balance, December 31, 2012 | $ | (9.0 | ) | $ | 0.8 | $ | (84.9 | ) | $ | 17.2 | $ | (75.9 | ) | |||
Other comprehensive (loss) income before reclassifications | (2.3 | ) | — | 6.1 | (4.6 | ) | (0.8 | ) | ||||||||
Amounts reclassified out | 3.7 | — | 3.5 | — | 7.2 | |||||||||||
Other comprehensive income (loss), net of tax | 1.4 | — | 9.6 | (4.6 | ) | 6.4 | ||||||||||
Balance, September 30, 2013 | $ | (7.6 | ) | $ | 0.8 | $ | (75.3 | ) | $ | 12.6 | $ | (69.5 | ) | |||
Reclassification out of Accumulated Other Comprehensive Loss | ' | |||||||||||||||
A summary of the reclassifications out of accumulated other comprehensive loss is presented in the following table ($ in millions): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
Detail of components | 2013 | 2013 | Location on Statement of Income | |||||||||||||
Losses on cash flow hedges: | ||||||||||||||||
Foreign currency contracts | $ | (1.4 | ) | $ | (3.8 | ) | Cost of goods and services sold | |||||||||
Interest rate swap contracts | (0.7 | ) | (1.9 | ) | Interest expense | |||||||||||
Forward treasury locks | — | (0.3 | ) | Interest expense | ||||||||||||
Total before tax | (2.1 | ) | (6.0 | ) | ||||||||||||
Tax expense | 0.8 | 2.3 | ||||||||||||||
Net of tax | $ | (1.3 | ) | $ | (3.7 | ) | ||||||||||
Amortization of defined benefit pension and other postretirement plans: | ||||||||||||||||
Transition obligation | $ | — | $ | (0.1 | ) | (a) | ||||||||||
Prior service cost | 0.3 | 1 | (a) | |||||||||||||
Actuarial losses | (1.7 | ) | (6.4 | ) | (a) | |||||||||||
Total before tax | (1.4 | ) | (5.5 | ) | ||||||||||||
Tax expense | 0.5 | 2 | ||||||||||||||
Net of tax | $ | (0.9 | ) | $ | (3.5 | ) | ||||||||||
Total reclassifications for the period, net of tax | $ | (2.2 | ) | $ | (7.2 | ) | ||||||||||
(a) These components are included in the computation of net periodic benefit cost. Refer to Note 11, Benefit Plans, for additional details. |
Benefit_Plans_Tables
Benefit Plans (Tables) | 9 Months Ended | |||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | ' | |||||||||||||||||||||||
Components of net periodic benefit cost | ' | |||||||||||||||||||||||
The components of net periodic benefit cost for the three months ended September 30 were as follows ($ in millions): | ||||||||||||||||||||||||
Pension benefits | Other retirement benefits | Total | ||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
Service cost | $ | 2.3 | $ | 2.1 | $ | 0.1 | $ | 0.3 | $ | 2.4 | $ | 2.4 | ||||||||||||
Interest cost | 3.6 | 3.7 | — | 0.3 | 3.6 | 4 | ||||||||||||||||||
Expected return on assets | (4.3 | ) | (4.0 | ) | — | — | (4.3 | ) | (4.0 | ) | ||||||||||||||
Amortization of prior service credit | (0.3 | ) | (0.3 | ) | — | — | (0.3 | ) | (0.3 | ) | ||||||||||||||
Recognized actuarial losses | 2.2 | 1.9 | (0.5 | ) | — | 1.7 | 1.9 | |||||||||||||||||
Net periodic benefit cost | $ | 3.5 | $ | 3.4 | $ | (0.4 | ) | $ | 0.6 | $ | 3.1 | $ | 4 | |||||||||||
Pension benefits | Other retirement benefits | Total | ||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
U.S. plans | $ | 2.7 | $ | 2.7 | $ | (0.4 | ) | $ | 0.6 | $ | 2.3 | $ | 3.3 | |||||||||||
International plans | 0.8 | 0.7 | — | — | 0.8 | 0.7 | ||||||||||||||||||
Net periodic benefit cost | $ | 3.5 | $ | 3.4 | $ | (0.4 | ) | $ | 0.6 | $ | 3.1 | $ | 4 | |||||||||||
The components of net periodic benefit cost for the nine months ended September 30 were as follows ($ in millions): | ||||||||||||||||||||||||
Pension benefits | Other retirement benefits | Total | ||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
Service cost | $ | 7.3 | $ | 6.7 | $ | 0.8 | $ | 1 | $ | 8.1 | $ | 7.7 | ||||||||||||
Interest cost | 11 | 11.4 | 0.5 | 0.7 | 11.5 | 12.1 | ||||||||||||||||||
Expected return on assets | (12.9 | ) | (12.2 | ) | — | — | (12.9 | ) | (12.2 | ) | ||||||||||||||
Amortization of transition obligation | 0.1 | 0.1 | — | — | 0.1 | 0.1 | ||||||||||||||||||
Amortization of prior service credit | (1.0 | ) | (1.1 | ) | — | 0.1 | (1.0 | ) | (1.0 | ) | ||||||||||||||
Recognized actuarial losses | 6.9 | 6.2 | (0.5 | ) | — | 6.4 | 6.2 | |||||||||||||||||
Net periodic benefit cost | $ | 11.4 | $ | 11.1 | $ | 0.8 | $ | 1.8 | $ | 12.2 | $ | 12.9 | ||||||||||||
Pension benefits | Other retirement benefits | Total | ||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||
U.S. plans | $ | 8.9 | $ | 9.1 | $ | 0.8 | $ | 1.8 | $ | 9.7 | $ | 10.9 | ||||||||||||
International plans | 2.5 | 2 | — | — | 2.5 | 2 | ||||||||||||||||||
Net periodic benefit cost | $ | 11.4 | $ | 11.1 | $ | 0.8 | $ | 1.8 | $ | 12.2 | $ | 12.9 | ||||||||||||
Segment_Information_Tables
Segment Information (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Segment Information | ' | |||||||||||||||
The following table presents information about our reportable segments, reconciled to consolidated totals: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
($ in millions) | 2013 | 2012 | 2013 | 2012 | ||||||||||||
Net sales: | ||||||||||||||||
Packaging Systems | $ | 251.5 | $ | 215.9 | $ | 754.5 | $ | 687.4 | ||||||||
Delivery Systems | 90.8 | 88.2 | 272.3 | 258.1 | ||||||||||||
Intersegment sales | (0.5 | ) | (0.3 | ) | (1.1 | ) | (0.6 | ) | ||||||||
Total net sales | $ | 341.8 | $ | 303.8 | $ | 1,025.70 | $ | 944.9 | ||||||||
Operating profit: | ||||||||||||||||
Packaging Systems | $ | 54.6 | $ | 39.2 | $ | 170 | $ | 143.4 | ||||||||
Delivery Systems | (0.1 | ) | 4.7 | 3.4 | 12.5 | |||||||||||
Corporate | (14.8 | ) | (16.0 | ) | (47.9 | ) | (46.2 | ) | ||||||||
Other unallocated items | — | (1.6 | ) | — | (6.1 | ) | ||||||||||
Total operating profit | $ | 39.7 | $ | 26.3 | $ | 125.5 | $ | 103.6 | ||||||||
Loss on debt extinguishment | — | — | 0.2 | 11.6 | ||||||||||||
Interest expense | 4.4 | 4.4 | 13.1 | 13.2 | ||||||||||||
Interest income | 0.4 | 0.5 | 1.4 | 1.5 | ||||||||||||
Income before income taxes | $ | 35.7 | $ | 22.4 | $ | 113.6 | $ | 80.3 | ||||||||
Restructuring_and_Other_Items_1
Restructuring and Other Items (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Restructuring and Other Items [Abstract] | ' | ' | ' | ' |
Restructuring reserve, accrual adjustment | ' | $1.70 | ' | ' |
Increase in contingent consideration liability | 0.3 | 0.5 | 0.5 | 0.9 |
Restructuring and related charges: | ' | ' | ' | ' |
Severance and post-employment benefits | 0 | -1.1 | 0 | -1.3 |
Impairments and asset write-offs | 0 | 2 | 0 | 2.4 |
Other restructuring charges | 0 | 0.2 | 0 | 0.7 |
Total restructuring and related charges | 0 | 1.1 | 0 | 1.8 |
Impairment charge | 0 | 0 | 0 | 3.4 |
Development income | -0.4 | -0.4 | -1.2 | -4.2 |
Acquisition-related contingencies | 0.3 | 0.5 | 0.5 | 0.9 |
Foreign exchange and other | 0.2 | 1 | 0.2 | 0.6 |
Total restructuring and other items | 0.1 | 2.2 | -0.5 | 2.5 |
Severance and benefits [Member] | ' | ' | ' | ' |
Restructuring Reserve [Roll Forward] | ' | ' | ' | ' |
Balance, beginning of period | ' | ' | 2.8 | ' |
Cash payments | ' | ' | -2.7 | ' |
Balance, end of period | 0.1 | ' | 0.1 | ' |
England Manufacturing Facility [Member] | ' | ' | ' | ' |
Restructuring and related charges: | ' | ' | ' | ' |
Impairments and asset write-offs | ' | $1.50 | ' | ' |
Restructuring_and_Other_Items_2
Restructuring and Other Items (Details 1) (USD $) | 3 Months Ended | 9 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 |
Restructuring and Other Items [Abstract] | ' | ' |
Recognition of income related to nonrefundable payment | $0.40 | $0.70 |
Nonrefundable payment from customer | 20 | ' |
Unearned income, current | 1.5 | 1.5 |
Unearned income, noncurrent | $17.80 | $17.80 |
Term of customer agreement | ' | '13 years 0 months 0 days |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Income Tax Disclosure [Abstract] | ' | ' | ' | ' | ' |
Effective tax rate (in hundredths) | 29.70% | 40.40% | 25.90% | 31.70% | ' |
Discrete tax charge, other adj | ' | ' | ' | $0.30 | ' |
Estimated reduction of unrecognized tax benefits | 2.1 | ' | 2.1 | ' | ' |
Accrued interest and penalties | 0.6 | ' | 0.6 | ' | 0.5 |
Discrete tax benefit, R&D credit | ' | ' | 1.3 | ' | ' |
Discrete tax charge, change in enacted tax rate | 1.3 | 0.8 | ' | ' | ' |
Discrete tax charge, foreign tax credit | ' | $1 | ' | ' | ' |
Derivative_Financial_Instrumen2
Derivative Financial Instruments (Details) | 9 Months Ended | 9 Months Ended | ||||||||||||||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 |
USD ($) | USD ($) | Forward-Start Interest Rate Swap [Member] | Interest Rate Swap, Series B Note [Member] | Foreign Currency Hedge, Euro-Denominated Sales [Member] | Foreign Currency Hedge, U.S. Inventory Purchases, Yen | Foreign Currency Hedge, U.S. Inventory Purchases, Yen | Foreign Currency Hedge, Europe Inventory Purchases, Dollars | Foreign Currency Hedge Europe Inventory Purchases, Yen [Member] | Foreign Currency Hedge Europe Inventory Purchases, Yen [Member] | Euro-Denominated Revolver [Member] | Euro-Denominated Revolver [Member] | Yen-Denominated Revolver [Member] | Yen-Denominated Revolver [Member] | Commodity Call Options [Member] | Euro Note B [Member] | Euro Note B [Member] | Euro-Denominated Debt [Member] | |
USD ($) | USD ($) | USD ($) | USD ($) | JPY (¥) | USD ($) | USD ($) | JPY (¥) | USD ($) | EUR (€) | USD ($) | JPY (¥) | USD ($) | USD ($) | EUR (€) | USD ($) | |||
MBbls | ||||||||||||||||||
Derivative [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loss recorded in cost of goods and services sold, call options | $0.10 | $0.10 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notional amount | ' | ' | ' | ' | 1.4 | 2.5 | 200.8 | 1.1 | 0.7 | 65 | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of hedged item | ' | ' | 41.7 | 25 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum term (in years) | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fixed interest rate | ' | ' | 5.41% | 5.51% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maturity date of debt | ' | ' | ' | 28-Jul-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Variable rate basis | ' | ' | 'one-month London Interbank Offering Rates (bLIBORb) | 'three-month LIBOR | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of monthly contracts remaining | ' | ' | ' | ' | 3 | 3 | 3 | 3 | 1 | 1 | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate notional amount of remaining contracts | ' | ' | ' | ' | 4.2 | 7.5 | 602.3 | 3.3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notional amount, nonderivative instruments | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28.4 | 21 | 5.1 | 500 | ' | 82.6 | 61.1 | ' |
Cumulative foreign currency translation loss (gain) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -0.3 | ' | ' | ' | ' | 3.7 |
Cumulative foreign currency translation loss (gain), net of tax | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -0.2 | ' | ' | ' | ' | 2.3 |
Purchased call options, barrels of crude oil (in barrels) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 58,000 | ' | ' | ' |
Premium paid to purchase call options | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.10 | ' | ' | ' |
Derivative_Financial_Instrumen3
Derivative Financial Instruments Effects of Derivative Instruments on OCI and Earnings (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Cash Flow Hedges [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI | ($0.30) | ($0.60) | ($2.30) | ($4.40) |
Amount of Loss Reclassified from Accumulated OCI into Income | 1.3 | 0.3 | 3.7 | 1.8 |
Net Investment Hedges [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI | -2.5 | -2.2 | -1.1 | 0.2 |
Amount of Loss Reclassified from Accumulated OCI into Income | 0 | 0 | 0 | 0 |
Foreign Currency Hedge Contracts [Member] | Net Sales [Member] | Cash Flow Hedges [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI | -0.2 | 0 | ' | ' |
Amount of Loss Reclassified from Accumulated OCI into Income | 0 | 0 | ' | ' |
Foreign Currency Hedge Contracts [Member] | Cost of Goods and Services Sold [Member] | Cash Flow Hedges [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI | 0.1 | -0.2 | -2.6 | 0.2 |
Amount of Loss Reclassified from Accumulated OCI into Income | 0.8 | 0 | 2.3 | 0 |
Interest Rate Swap Contracts [Member] | Interest Expense [Member] | Cash Flow Hedges [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI | -0.2 | -0.4 | 0.3 | -1.8 |
Amount of Loss Reclassified from Accumulated OCI into Income | 0.4 | 0.3 | 1.2 | 1.8 |
Foreign Currency - Denominated Debt [Member] | Foreign Exchange and Other [Member] | Net Investment Hedges [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI | -2.5 | -2.2 | -1.1 | 0.2 |
Amount of Loss Reclassified from Accumulated OCI into Income | 0 | 0 | 0 | 0 |
Forward Treasury Locks [Member] | Interest Expense [Member] | Cash Flow Hedges [Member] | ' | ' | ' | ' |
Derivative Instruments, Gain (Loss) [Line Items] | ' | ' | ' | ' |
Amount of Gain (Loss) Recognized in OCI | 0 | 0 | 0 | -2.8 |
Amount of Loss Reclassified from Accumulated OCI into Income | $0.10 | $0 | $0.20 | $0 |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 |
Assets: | ' | ' | ' |
Short-term investments | $7.50 | ' | $12.40 |
Deferred compensation assets | 5.2 | ' | 4 |
Total assets at fair value | 12.7 | ' | 16.4 |
Liabilities: | ' | ' | ' |
Contingent consideration | 3.8 | ' | 3.3 |
Deferred compensation liabilities | 9.8 | ' | 7.6 |
Interest rate swap contracts | 6.3 | ' | 8.6 |
Foreign currency contracts | 1.8 | ' | 1.4 |
Total liabilities at fair value | 21.7 | ' | 20.9 |
Other Financial Instruments [Abstract] | ' | ' | ' |
Long-term debt, fair value | 383.5 | ' | 386 |
Long-term debt | 381.1 | ' | 378.8 |
Level 3 Fair Value Measurements [Roll Forward] | ' | ' | ' |
Balance, beginning of period | 3.3 | 2.1 | ' |
Increase in fair value recorded in earnings | 0.5 | 0.9 | ' |
Balance, end of period | 3.8 | 3 | ' |
Level 1 [Member] | ' | ' | ' |
Assets: | ' | ' | ' |
Short-term investments | 7.5 | ' | 12.4 |
Deferred compensation assets | 5.2 | ' | 4 |
Total assets at fair value | 12.7 | ' | 16.4 |
Liabilities: | ' | ' | ' |
Deferred compensation liabilities | 9.8 | ' | 7.6 |
Total liabilities at fair value | 9.8 | ' | 7.6 |
Level 2 [Member] | ' | ' | ' |
Liabilities: | ' | ' | ' |
Interest rate swap contracts | 6.3 | ' | 8.6 |
Foreign currency contracts | 1.8 | ' | 1.4 |
Total liabilities at fair value | 8.1 | ' | 10 |
Level 3 [Member] | ' | ' | ' |
Liabilities: | ' | ' | ' |
Contingent consideration | 3.8 | ' | 3.3 |
Total liabilities at fair value | $3.80 | ' | $3.30 |
Inventories_Details
Inventories (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Finished goods | $76.70 | $70.90 |
Work in process | 28.1 | 23.6 |
Raw materials | 71.9 | 67.7 |
Total inventories | $176.70 | $162.20 |
Debt_Details
Debt (Details) (USD $) | 9 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | $400 | $411.50 |
Notes payable and other current debt | 18.9 | 32.7 |
Long-term debt, excluding current portion | 381.1 | 378.8 |
Senior C Notes, Due 2027 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 73 | 73 |
Senior B Notes, Due 2024 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 53 | 53 |
Senior A Notes, Due 2022 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 42 | 42 |
Revolving credit facility, due 2017 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 80.3 | 71.5 |
Line of credit facility classified as short-term | 16.8 | 5.7 |
Line of credit facility, classified as long-term | 63.5 | 65.8 |
Line of credit facility outstanding borrowings, Yen | 5.1 | ' |
Line of credit facility outstanding borrowings, Euro | 28.4 | ' |
Term Loan Due 2018 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 41.7 | 35.3 |
Current portion of long-term debt | 2 | ' |
Debt instrument, face amount | 42.8 | ' |
Debt Instrument Term | '5 years 0 months 0 days | ' |
Debt Instrument, Description of Variable Rate Basis | 'one-month LIBOR | ' |
Debt Instrument, Basis Spread on Variable Rate | 1.50% | ' |
Series B Floating Rate Notes Due 2015 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 25 | 25 |
EURO Note A Due 2013 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 0 | 26.9 |
EURO Note B Due 2016 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 82.6 | 80.8 |
Convertible Debt Due 2047 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 1.4 | 3.1 |
Aggregate principal amount repurchased | 1.7 | ' |
Interest rate (in hundredths) | 4.00% | ' |
Loss on debt extinguishment | 0.2 | ' |
Term Loan Due 2014 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 0.1 | 0.2 |
Capital leases, due through 2016 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Capital leases | 0.5 | 0.7 |
Notes Payable due 2019 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 0.4 | 0 |
$50M Revolving Credit Facility [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Line of Credit Facility, Maximum Borrowing Capacity | $50 | ' |
Net_Income_Per_Share_Details
Net Income Per Share (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Earnings Per Share [Abstract] | ' | ' | ' | ' |
Net income, as reported, for basic net income per share | $26.80 | $14.80 | $88.70 | $59.60 |
Plus: interest expense on convertible debt, net of tax | 0 | 0 | 0 | 1.9 |
Net income for diluted net income per share | $26.80 | $14.80 | $88.70 | $61.50 |
Weighted average common shares outstanding (in shares) | 69.8 | 68.3 | 69.4 | 68 |
Assumed stock options exercised and awards vested, based on the treasury stock method (in shares) | 1.6 | 1 | 1.4 | 0.9 |
Assumed conversion of convertible debt, based on the if-converted method (in shares) | 0 | 0.1 | 0.1 | 3.4 |
Weighted average shares assuming dilution (in shares) | 71.4 | 69.4 | 70.9 | 72.3 |
Antidilutive options excluded from computation of diluted net income per share (in shares) | ' | 0.1 | 0.7 | 2.9 |
Accumulated_Other_Comprehensiv2
Accumulated Other Comprehensive Loss (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Equity [Abstract] | ' | ' | ' | ' |
Pre-tax actuarial gain, recognized in AOCI | $10.10 | ' | ' | ' |
Changes in the Components of Accumulated Other Comprehensive Loss, Net of Tax [Roll Forward] | ' | ' | ' | ' |
Balance, beginning | ' | ' | -75.9 | ' |
Other comprehensive (loss) income before reclassifications | ' | ' | -0.8 | ' |
Amounts reclassified from AOCI | ' | ' | 7.2 | ' |
Other comprehensive income (loss), net of tax | 21.9 | 17 | 6.4 | -0.3 |
Balance, ending | -69.5 | ' | -69.5 | ' |
Losses on Cash Flow Hedges [Member] | ' | ' | ' | ' |
Changes in the Components of Accumulated Other Comprehensive Loss, Net of Tax [Roll Forward] | ' | ' | ' | ' |
Balance, beginning | ' | ' | -9 | ' |
Other comprehensive (loss) income before reclassifications | ' | ' | -2.3 | ' |
Amounts reclassified from AOCI | ' | ' | 3.7 | ' |
Other comprehensive income (loss), net of tax | ' | ' | 1.4 | ' |
Balance, ending | -7.6 | ' | -7.6 | ' |
Unrealized Gains on Investment Securities [Member] | ' | ' | ' | ' |
Changes in the Components of Accumulated Other Comprehensive Loss, Net of Tax [Roll Forward] | ' | ' | ' | ' |
Balance, beginning | ' | ' | 0.8 | ' |
Other comprehensive (loss) income before reclassifications | ' | ' | 0 | ' |
Amounts reclassified from AOCI | ' | ' | 0 | ' |
Other comprehensive income (loss), net of tax | ' | ' | 0 | ' |
Balance, ending | 0.8 | ' | 0.8 | ' |
Defined Benefit Pension and Other Postretirement Plans [Member] | ' | ' | ' | ' |
Changes in the Components of Accumulated Other Comprehensive Loss, Net of Tax [Roll Forward] | ' | ' | ' | ' |
Balance, beginning | ' | ' | -84.9 | ' |
Other comprehensive (loss) income before reclassifications | ' | ' | 6.1 | ' |
Amounts reclassified from AOCI | ' | ' | 3.5 | ' |
Other comprehensive income (loss), net of tax | ' | ' | 9.6 | ' |
Balance, ending | -75.3 | ' | -75.3 | ' |
Foreign Currency Translation [Member] | ' | ' | ' | ' |
Changes in the Components of Accumulated Other Comprehensive Loss, Net of Tax [Roll Forward] | ' | ' | ' | ' |
Balance, beginning | ' | ' | 17.2 | ' |
Other comprehensive (loss) income before reclassifications | ' | ' | -4.6 | ' |
Amounts reclassified from AOCI | ' | ' | 0 | ' |
Other comprehensive income (loss), net of tax | ' | ' | -4.6 | ' |
Balance, ending | $12.60 | ' | $12.60 | ' |
Accumulated_Other_Comprehensiv3
Accumulated Other Comprehensive Loss (Details 1) (USD $) | 3 Months Ended | 9 Months Ended | ||||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||
Reclassification out of Accumulated Other Comprehensive Loss [Line Items] | ' | ' | ' | ' | ||
Cost of goods and services sold | ($236.30) | ($213.40) | ($697.60) | ($654.70) | ||
Interest expense | -4.4 | -4.4 | -13.1 | -13.2 | ||
Transition obligation | ' | ' | 0.1 | 0.1 | ||
Prior service cost | 0.3 | 0.3 | 1 | 1 | ||
Actuarial losses | -1.7 | -1.9 | -6.4 | -6.2 | ||
Income before income taxes | 35.7 | 22.4 | 113.6 | 80.3 | ||
Tax expense | -10.6 | -9 | -29.5 | -25.5 | ||
Net income | 26.8 | 14.8 | 88.7 | 59.6 | ||
Reclassification out of Accumulated Other Comprehensive Loss [Member] | ' | ' | ' | ' | ||
Reclassification out of Accumulated Other Comprehensive Loss [Line Items] | ' | ' | ' | ' | ||
Net income | -2.2 | ' | -7.2 | ' | ||
Reclassification out of Accumulated Other Comprehensive Loss [Member] | Losses on Cash Flow Hedges [Member] | ' | ' | ' | ' | ||
Reclassification out of Accumulated Other Comprehensive Loss [Line Items] | ' | ' | ' | ' | ||
Income before income taxes | -2.1 | ' | -6 | ' | ||
Tax expense | 0.8 | ' | 2.3 | ' | ||
Net income | -1.3 | ' | -3.7 | ' | ||
Reclassification out of Accumulated Other Comprehensive Loss [Member] | Amortization of Defined Benefit Pension and Other Postretirement Plans [Member] | ' | ' | ' | ' | ||
Reclassification out of Accumulated Other Comprehensive Loss [Line Items] | ' | ' | ' | ' | ||
Transition obligation | 0 | [1] | ' | -0.1 | [1] | ' |
Prior service cost | 0.3 | [1] | ' | 1 | [1] | ' |
Actuarial losses | -1.7 | [1] | ' | -6.4 | [1] | ' |
Income before income taxes | -1.4 | ' | -5.5 | ' | ||
Tax expense | 0.5 | ' | 2 | ' | ||
Net income | -0.9 | ' | -3.5 | ' | ||
Foreign Currency Contract [Member] | Reclassification out of Accumulated Other Comprehensive Loss [Member] | Losses on Cash Flow Hedges [Member] | ' | ' | ' | ' | ||
Reclassification out of Accumulated Other Comprehensive Loss [Line Items] | ' | ' | ' | ' | ||
Cost of goods and services sold | -1.4 | ' | -3.8 | ' | ||
Interest Rate Swap Contracts [Member] | Reclassification out of Accumulated Other Comprehensive Loss [Member] | Losses on Cash Flow Hedges [Member] | ' | ' | ' | ' | ||
Reclassification out of Accumulated Other Comprehensive Loss [Line Items] | ' | ' | ' | ' | ||
Interest expense | -0.7 | ' | -1.9 | ' | ||
Forward Treasury Locks [Member] | Reclassification out of Accumulated Other Comprehensive Loss [Member] | Losses on Cash Flow Hedges [Member] | ' | ' | ' | ' | ||
Reclassification out of Accumulated Other Comprehensive Loss [Line Items] | ' | ' | ' | ' | ||
Interest expense | $0 | ' | ($0.30) | ' | ||
[1] | These components are included in the computation of net periodic benefit cost. Refer to Note 11, Benefit Plans, for additional details. |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ' | ' | ' |
Shares available for issuance under the 2011 Plan (in shares) | 5,932,577 | ' | 5,932,577 | ' |
Stock options, granted (in shares) | ' | ' | 922,348 | ' |
Stock options, weighted average exercise price (in dollars per share) | ' | ' | $29.71 | ' |
Stock options, vesting period (in years) | ' | ' | '4 years | ' |
Stock options, expiration period (in years) | ' | ' | '10 years | ' |
Stock options, weighted average grant date fair value (in dollars per share) | ' | ' | $5.73 | ' |
Assumptions used in Black-Scholes model | ' | ' | ' | ' |
Risk-free interest rate (in hundredths) | ' | ' | 0.89% | ' |
Expected life (in years) | ' | ' | '6 years | ' |
Stock volatility (in hundredths) | ' | ' | 22.50% | ' |
Dividend yield (in hundredths) | ' | ' | 1.30% | ' |
Granted, PVS awards (in shares) | ' | ' | 176,952 | ' |
Grant date fair value, PVS awards (in dollars per share) | ' | ' | $29.71 | ' |
Number of shares of common stock per PVS award (in shares) | 1 | ' | 1 | ' |
Performance period for the annual growth rate of revenue and return on invested capital targets to be achieved | ' | ' | '3 years | ' |
PVS payout, Minimum (in hundredths) | 0.00% | ' | 0.00% | ' |
PVS payout, Maximum (in hundredths) | 200.00% | ' | 200.00% | ' |
Stock-based compensation expense | $5.20 | $4.40 | $15.60 | $11.80 |
Benefit_Plans_Details
Benefit Plans (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Service cost | $2.40 | $2.40 | $8.10 | $7.70 |
Interest cost | 3.6 | 4 | 11.5 | 12.1 |
Expected return on assets | -4.3 | -4 | -12.9 | -12.2 |
Amortization of transition obligation | ' | ' | 0.1 | 0.1 |
Amortization of prior service credit | -0.3 | -0.3 | -1 | -1 |
Recognized actuarial losses | 1.7 | 1.9 | 6.4 | 6.2 |
Net periodic benefit cost | 3.1 | 4 | 12.2 | 12.9 |
Pension Benefits [Member] | ' | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Service cost | 2.3 | 2.1 | 7.3 | 6.7 |
Interest cost | 3.6 | 3.7 | 11 | 11.4 |
Expected return on assets | -4.3 | -4 | -12.9 | -12.2 |
Amortization of transition obligation | ' | ' | 0.1 | 0.1 |
Amortization of prior service credit | -0.3 | -0.3 | -1 | -1.1 |
Recognized actuarial losses | 2.2 | 1.9 | 6.9 | 6.2 |
Net periodic benefit cost | 3.5 | 3.4 | 11.4 | 11.1 |
Other Retirement Benefits [Member] | ' | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Service cost | 0.1 | 0.3 | 0.8 | 1 |
Interest cost | 0 | 0.3 | 0.5 | 0.7 |
Expected return on assets | 0 | 0 | 0 | 0 |
Amortization of transition obligation | ' | ' | 0 | 0 |
Amortization of prior service credit | 0 | 0 | 0 | 0.1 |
Recognized actuarial losses | -0.5 | 0 | -0.5 | 0 |
Net periodic benefit cost | -0.4 | 0.6 | 0.8 | 1.8 |
U.S. Pension Benefit Plans [Member] | ' | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Net periodic benefit cost | 2.7 | 2.7 | 8.9 | 9.1 |
International Pension Benefit Plans [Member] | ' | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Net periodic benefit cost | 0.8 | 0.7 | 2.5 | 2 |
U.S. Other Retirement Benefit Plans [Member] | ' | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Net periodic benefit cost | -0.4 | 0.6 | 0.8 | 1.8 |
International Other Retirement Benefit Plans [Member] | ' | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Net periodic benefit cost | 0 | 0 | 0 | 0 |
U.S. Plans [Member] | ' | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Net periodic benefit cost | 2.3 | 3.3 | 9.7 | 10.9 |
International Plans [Member] | ' | ' | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | ' | ' | ' | ' |
Net periodic benefit cost | $0.80 | $0.70 | $2.50 | $2 |
Segment_Information_Details
Segment Information (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' | ' | ' |
Reportable segments | ' | ' | 2 | ' |
Net sales | $341.80 | $303.80 | $1,025.70 | $944.90 |
Operating profit | 39.7 | 26.3 | 125.5 | 103.6 |
Loss on debt extinguishment | 0 | 0 | 0.2 | 11.6 |
Interest expense | 4.4 | 4.4 | 13.1 | 13.2 |
Interest income | 0.4 | 0.5 | 1.4 | 1.5 |
Income before income taxes | 35.7 | 22.4 | 113.6 | 80.3 |
Packaging Systems [Member] | ' | ' | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' | ' | ' |
Net sales | 251.5 | 215.9 | 754.5 | 687.4 |
Operating profit | 54.6 | 39.2 | 170 | 143.4 |
Delivery Systems [Member] | ' | ' | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' | ' | ' |
Net sales | 90.8 | 88.2 | 272.3 | 258.1 |
Operating profit | -0.1 | 4.7 | 3.4 | 12.5 |
Intersegment Sales [Member] | ' | ' | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' | ' | ' |
Net sales | -0.5 | -0.3 | -1.1 | -0.6 |
Corporate [Member] | ' | ' | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' | ' | ' |
Operating profit | -14.8 | -16 | -47.9 | -46.2 |
Other Unallocated Items [Member] | ' | ' | ' | ' |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ' | ' | ' | ' |
Operating profit | $0 | ($1.60) | $0 | ($6.10) |