Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2016 | Nov. 01, 2016 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | NPO | |
Entity Registrant Name | ENPRO INDUSTRIES, INC | |
Entity Central Index Key | 1,164,863 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 21,361,118 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Income Statement [Abstract] | ||||
Net sales | $ 292.7 | $ 306.6 | $ 900.8 | $ 882.5 |
Cost of sales | 194.1 | 205.2 | 596.7 | 590 |
Gross profit | 98.6 | 101.4 | 304.1 | 292.5 |
Operating expenses: | ||||
Selling, general and administrative | 70.9 | 74.8 | 231.7 | 226.2 |
Goodwill and Intangible Asset Impairment | 0 | 0 | 0 | 47 |
Asbestos settlement | 0 | 0 | 80 | 0 |
Other | 2.4 | 1.7 | 10.4 | 3.3 |
Total operating expenses | 73.3 | 76.5 | 322.1 | 276.5 |
Operating income (loss) | 25.3 | 24.9 | (18) | 16 |
Interest expense | (14.3) | (12.9) | (41.7) | (39) |
Interest income | 0.3 | 0.1 | 0.7 | 0.4 |
Other income (expense) | (1.3) | 0.1 | (5.4) | (4.2) |
Income (loss) before income taxes | 10 | 12.2 | (64.4) | (26.8) |
Income tax benefit (expense) | (4) | (0.8) | 27.2 | (0.7) |
Net income (loss) | 6 | 11.4 | (37.2) | (27.5) |
Comprehensive income (loss) | $ 6.6 | $ 7.5 | $ (38.6) | $ (39.5) |
Basic earnings (loss) per share | $ 0.28 | $ 0.52 | $ (1.71) | $ (1.21) |
Diluted earnings (loss) per share | 0.28 | 0.51 | (1.71) | (1.21) |
Common Stock, Dividends, Per Share, Declared | $ 0.21 | $ 0.20 | $ 0.63 | $ 0.60 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
OPERATING ACTIVITIES | ||
Net loss | $ (37.2) | $ (27.5) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation | 22.8 | 22.4 |
Amortization | 19.9 | 20.9 |
Loss on exchange and repurchase of convertible debentures | 0 | 2.8 |
Goodwill and Intangible Asset Impairment | 0 | 47 |
Asbestos settlement | 80 | 0 |
Deferred income taxes | (38.7) | 0.3 |
Stock-based compensation | 4.8 | 3.6 |
Other non-cash adjustments | 0.8 | 1.1 |
Change in assets and liabilities, net of effects of acquisitions and sale of businesses: | ||
Accounts receivable, net | (8.3) | (2.1) |
Inventories | 2 | (12.6) |
Accounts payable | (17.4) | (9.5) |
Other current assets and liabilities | (4.7) | 0 |
Other non-current assets and liabilities | (16.1) | (14.4) |
Net cash provided by operating activities | 7.9 | 32 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (24.6) | (23.4) |
Payments for capitalized internal-use software | (3.1) | (3.6) |
Acquisitions, net of cash acquired | (28.5) | (45.5) |
Other | 3.7 | 0.3 |
Net cash used in investing activities | (52.5) | (72.2) |
FINANCING ACTIVITIES | ||
Proceeds from debt | 303.3 | 181.3 |
Repayments of debt | (192.7) | (123.1) |
Repurchase of common stock | (26.2) | (80) |
Dividends paid | (13.6) | (13.8) |
Repurchase of convertible debentures conversion option | 0 | (21.6) |
Other | (3.1) | (2.1) |
Net cash provided by (used in) financing activities | 67.7 | (59.3) |
Effect of exchange rate changes on cash and cash equivalents | (11.7) | (2.7) |
Net increase (decrease) in cash and cash equivalents | 11.4 | (102.2) |
Cash and cash equivalents at beginning of period | 103.4 | 194.2 |
Cash and cash equivalents at end of period | 114.8 | 92 |
Cash paid during the period for: | ||
Interest | 39.7 | 35.8 |
Income taxes, net | 26.8 | 22.8 |
Non-cash investing and financing activities: | ||
Non-cash acquisitions of property, plant, and equipment | $ 4.8 | $ 7.6 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 114.8 | $ 103.4 |
Accounts receivable, net | 222.6 | 212.5 |
Inventories | 178.9 | 178.4 |
Prepaid expenses and other current assets | 36.6 | 23.6 |
Total current assets | 552.9 | 517.9 |
Property, plant and equipment, net | 216.2 | 211.5 |
Goodwill | 203.5 | 195.9 |
Other intangible assets, net | 184.8 | 190.4 |
Investment in GST | 236.9 | 236.9 |
Deferred income taxes and income tax receivable | 149.1 | 109.3 |
Other assets | 38.1 | 36.9 |
Total assets | 1,581.5 | 1,498.8 |
Current liabilities | ||
Short-term borrowings from GST | 27.8 | 24.3 |
Notes payable to GST | 295.9 | 12.2 |
Current maturities of long-term debt | 0.1 | 0.1 |
Accounts payable | 89.1 | 101.5 |
Accrued expenses | 121.5 | 140.6 |
Total current liabilities | 534.4 | 278.7 |
Long-term debt | 462.5 | 356.2 |
Notes payable to GST | 0 | 271 |
Liabilities Subject to Compromise, Asbestos Obligations | 110 | 30 |
Other liabilities | 90.5 | 103.1 |
Total liabilities | 1,197.4 | 1,039 |
Commitments and contingencies | ||
Shareholders’ equity | ||
Common stock – $.01 par value; 100,000,000 shares authorized; issued, 21,598,399 shares in 2016 and 22,046,647 shares in 2015 | 0.2 | 0.2 |
Additional paid-in capital | 349.2 | 372.5 |
Retained earnings | 91.5 | 142.5 |
Accumulated other comprehensive loss | (55.5) | (54.1) |
Common stock held in treasury, at cost – 194,517 shares in 2016 and 196,593 shares in 2015 | (1.3) | (1.3) |
Total shareholders’ equity | 384.1 | 459.8 |
Total liabilities and equity | $ 1,581.5 | $ 1,498.8 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 21,598,399 | 22,046,647 |
Treasury stock, shares (in shares) | 194,517 | 196,593 |
Overview, Basis of Presentation
Overview, Basis of Presentation and Recently Issued Authoritative Accounting Guidance | 9 Months Ended |
Sep. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview, Basis of Presentation and Recently Issued Authoritative Accounting Guidance | Overview, Basis of Presentation and Recently Issued Authoritative Accounting Guidance Overview EnPro Industries, Inc. (“we,” “us,” “our,” “EnPro” or the “Company”) is a leader in the design, development, manufacture and marketing of proprietary engineered industrial products that primarily include: sealing products; heavy-duty truck wheel-end component systems; self-lubricating non-rolling bearing products; precision engineered components and lubrication systems for reciprocating compressors; and heavy-duty, medium-speed diesel, natural gas and dual fuel reciprocating engines, including parts and services. Basis of Presentation The accompanying interim consolidated financial statements are unaudited, and certain related information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted in accordance with Rule 10-01 of Regulation S-X. They were prepared following the same policies and procedures used in the preparation of our annual financial statements and reflect all adjustments (consisting of normal recurring adjustments) necessary for a fair statement of results for the periods presented. The Consolidated Balance Sheet as of December 31, 2015 was derived from the audited financial statements included in our annual report on Form 10-K for the year ended December 31, 2015 . The results of operations for the interim periods are not necessarily indicative of the results for the fiscal year. These consolidated financial statements should be read in conjunction with our annual consolidated financial statements for the year ended December 31, 2015 included within our annual report on Form 10-K. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amount of assets and liabilities and the disclosures regarding contingent assets and liabilities at period end and the reported amounts of revenue and expenses during the reporting period. Actual results may differ from these estimates. All intercompany accounts and transactions between our consolidated operations have been eliminated. In the first quarter of 2016, we adopted a standard that amends existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability instead of a deferred charge. As a result of adopting this standard retrospectively, $4.7 million of debt issuance costs previously presented in other assets on the Consolidated Balance Sheet as of December 31, 2015 were reclassified as a reduction of long-term debt. In addition, we have revised our December 31, 2015 Condensed Consolidating Balance Sheet that is presented in our supplemental guarantor financial information. Refer to Note 18, "Supplemental Guarantor Financial Information" for more details about this revision. Recently Issued Authoritative Accounting Guidance In August 2016, a standard was issued to eliminate diversity in practice in the classification of certain cash receipts and cash payments within the statement of cash flows. The standard is effective for annual periods beginning after December 15, 2017, and interim periods therein. Early adoption is permitted, including adoption in an interim period. The guidance requires application through a retrospective transition method. We are currently evaluating the new guidance to determine the impact it will have on our consolidated financial statements. In June 2016, a standard was issued that significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income, including trade receivables. The standard requires an entity to estimate its lifetime “expected credit loss” for such assets at inception, and record an allowance that, when deducted from the amortized cost basis of the financial asset, presents the net amount expected to be collected on the financial asset. The standard is effective for annual periods beginning after December 15, 2019, and interim periods therein. Early adoption is permitted for annual periods beginning after December 15, 2018, and interim periods therein. We are currently evaluating the new guidance to determine the impact it will have on our consolidated financial statements. In March 2016, a standard was issued to modify and simplify several aspects of accounting for share-based payment transactions. Changes to the current guidance primarily pertain to the income tax consequences of share-based payment transactions. Under the standard, all excess tax benefits and tax deficiencies (including tax benefits of dividends on share-based payment awards) should be recognized as income tax expense or benefit in the income statement. The tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur, regardless of whether the benefit reduces taxes payable in the current period. The full amount of excess tax benefits should be classified along with other income tax cash flows as an operating activity. When awards are settled, cash paid to the taxing authorities by an employer when directly withholding shares for tax withholding purposes will be classified as a financing activity. Additionally, with respect to forfeitures of awards, an entity can make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. The amendments in this standard are effective for annual periods beginning after December 15, 2016, and interim periods within those annual periods, with early adoption permitted. We are currently evaluating the new guidance to determine the impact it will have on our consolidated financial statements. In February 2016, a standard was issued to establish principles to report transparent and economically neutral information about the assets and liabilities that arise from leases. The standard will require lessees to recognize the lease assets and lease liabilities that arise from all leases in the statement of financial position and to disclose qualitative and quantitative information about lease transactions, such as information about variable lease payments and options to renew and terminate leases. The standard retains a distinction between finance leases and operating leases. As a result, the effect of leases in the statement of comprehensive income and the statement of cash flows is largely unchanged. Additionally, the guidance provides clarification on the definition of a lease, including alignment of the concept of control of an asset with principles in other authoritative guidance around revenue recognition and consolidation. The amendments in this guidance are effective for financial statements issued for interim and annual periods beginning after December 15, 2018, with early adoption permitted. We are currently evaluating the new guidance to determine the impact it will have on our consolidated financial statements. In January 2016, a standard was issued that amends existing guidance around classification and measurement of certain financial assets and liabilities. Changes to the current GAAP model primarily affect the accounting for equity investments, financial liabilities under the fair value option, and the presentation and disclosure requirements for financial instruments. Under the new guidance, all equity investments in unconsolidated entities (other than those accounted for using the equity method of accounting) will generally be measured at fair value through earnings. For equity investments without readily determinable fair values, the cost method is also eliminated. However, most entities will be able to elect to record equity investments without readily determinable fair values at cost, less impairment, and plus or minus subsequent adjustments for observable price changes. The standard also requires that financial assets and liabilities be disclosed separately in the notes to the financial statements based on measurement principle and form of financial asset. The amendments in this guidance are effective for financial statements issued for interim and annual periods beginning after December 15, 2017. This standard is not expected to have a significant impact on our consolidated financial statements or disclosures. In July 2015, a standard was issued that simplifies the measurement of inventory by requiring certain inventory to be measured at the lower of cost or net realizable value. This will not apply to the portion of our inventory that is measured using the last-in, first-out method. The amendments in this guidance are effective for fiscal years beginning after December 15, 2016 and for interim periods therein, but early application is permitted. This standard is not expected to have a significant impact on our consolidated financial statements or disclosures. In August 2014, a standard was issued that requires management of entities to assess the entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term "substantial doubt," (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued. The new standard will be effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. This standard is not expected to have an impact on our consolidated financial statements or disclosures. In May 2014, a comprehensive new revenue recognition standard was issued that will supersede nearly all existing revenue recognition guidance. The new guidance introduces a five-step model in which an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance also requires disclosures sufficient to enable users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative disclosures about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. The new standard will become effective for us beginning with the first quarter 2018. We are currently evaluating the new guidance, including possible transition alternatives, to determine the impact it will have on our consolidated financial statements. The guidance has the potential to affect our current practice of accounting for certain engine contracts as single profit centers under existing guidance in instances where such contracts are determined to have multiple performance obligations that are distinct within the context of the contract. Additionally, we are reviewing our engine contracts where significant costs are incurred to procure specialized equipment to review whether such costs will be eligible to be included in measuring progress toward satisfying the performance obligations in the contracts. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions On April 29, 2016, we acquired certain assets and assumed certain liabilities of Rubber Fab Gasket & Molding, Inc. ("Rubber Fab"), a privately-held company offering a full range of high performance sanitary gaskets, hoses and fittings for the hygienic process industries with annual revenues of approximately $17 million . Rubber Fab is managed as part of EnPro’s Garlock division within the Sealing Products segment. In July 2015, we purchased the Veyance North American air spring business (the "Air Spring Business") through the purchase of 100% of the stock of Veyance's Mexico business and of all of the assets of its U.S. business. In the second quarter of 2016, we finalized and agreed upon the acquisition date balance sheet of the Air Spring Business with the seller and made an additional cash payment for the final agreed-upon acquisition date working capital balance. In total, we paid $28.5 million in the nine months ended September 30, 2016 for these businesses. Because the assets, liabilities and results of operations for these acquisitions are not significant to our consolidated financial position or results of operations, pro forma financial information and additional disclosures are not presented. |
Income Taxes Income Taxes
Income Taxes Income Taxes | 9 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our income tax expense and resulting effective tax rate are based upon the estimated annual effective tax rates applicable for the respective periods adjusted for the effect of items required to be treated as discrete interim period items, including losses generated in countries where we are projecting annual losses for which a deferred tax asset is not anticipated to be recognized. This effective tax rate is generally lower than U.S. statutory tax rates primarily due to the earnings in lower rate foreign jurisdictions where a significant portion of our income is taxed, and fluctuates based on the portion of our profits earned in each jurisdiction. In addition, the rate can be magnified by pre-tax losses in high jurisdictions offset somewhat by pre-tax profits in low tax jurisdictions. We recorded income tax benefit of $27.2 million on pre-tax loss of $64.4 million in the nine months ended September 30, 2016, resulting in an effective tax rate of 42.3% . During the nine months ended September 30, 2016, significant pre-tax losses were benefited in the U.S. at a higher annual effective tax rate. Pre-tax profits outside the U.S. resulted in proportionally lower tax expense, thus skewing the overall rate. During the first nine months of 2015, our effective tax rate was negative 2.4% as we recorded an income tax expense of $0.7 million on pre-tax loss of $26.8 million . The volatility in the tax rate is primarily the result of significant discrete items that were recorded during the first six months of 2015. We released a valuation allowance in France where an entity had demonstrated sustained earnings to overcome a history of negative evidence. The full $ 3.2 million benefit of this valuation allowance release was recorded as a discrete item in the first quarter of 2015. Additionally, in the second quarter of 2015, we recorded a discrete tax benefit of only $0.8 million on the $47.0 million goodwill and other intangible asset impairment. During the third quarter of 2016, our effective tax rate was 39.6% as we recorded an income tax expense of $4.0 million on pre-tax income of $ 10.0 million . The volatility in the quarterly tax rate is the result of using annual tax rates derived from a geographic mix of pre-tax losses and income. The combination of mix, overall loss limitations, and small denominators result in a high effective quarterly rate. During the third quarter of 2015, our effective tax rate was 6.3% as we recorded an income tax expense of $0.8 million on pre-tax income of $ 12.2 million . The unusual tax expense in the prior year primarily resulted from our inability to record tax benefits related to the largely nondeductible goodwill impairment charge, all of which was recorded in the second quarter as a discrete item. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings (Loss) Per Share Quarters Ended Nine Months Ended 2016 2015 2016 2015 (in millions, except per share amounts) Numerator (basic and diluted): Net income (loss) $ 6.0 $ 11.4 $ (37.2 ) $ (27.5 ) Denominator: Weighted-average shares – basic 21.5 22.0 21.7 22.7 Share-based awards 0.2 0.1 — — Weighted-average shares – diluted 21.7 22.1 21.7 22.7 Earnings (loss) per share: Basic $ 0.28 $ 0.52 $ (1.71 ) $ (1.21 ) Diluted $ 0.28 $ 0.51 $ (1.71 ) $ (1.21 ) In the nine months ended September 30, 2016 and September 30, 2015 , there were losses attributable to common shares. There were 0.2 million and 1.0 million potentially dilutive shares, respectively, excluded for the nine months ended September 30, 2016 and 2015 since they were antidilutive. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories September 30, December 31, (in millions) Finished products $ 106.5 $ 110.2 Work in process 25.0 25.6 Raw materials and supplies 52.7 49.0 184.2 184.8 Reserve to reduce certain inventories to LIFO basis (11.3 ) (11.3 ) Manufacturing inventories 172.9 173.5 Incurred costs relating to long-term contracts 13.4 10.9 Progress payments related to long-term contracts (7.4 ) (6.0 ) Net balance associated with completed-contract inventories 6.0 4.9 Total inventories $ 178.9 $ 178.4 Incurred costs related to long-term contracts in the table above represent inventoried work in process and finished products related to engine contracts accounted for under the completed-contract method, where costs incurred exceed customer billings. Refer to Note 6, “Long-Term Contracts” for additional information about incurred costs and progress payments related to long-term contracts. We use the last-in, first-out (“LIFO”) method of valuing certain of our inventories. An actual valuation of inventory under the LIFO method can be made only at the end of each year based on the inventory levels and costs at that time. Accordingly, interim LIFO calculations are based on management’s estimates of expected year-end inventory levels and costs, which are subject to change until the final year-end LIFO inventory valuation. |
Long-Term Contracts
Long-Term Contracts | 9 Months Ended |
Sep. 30, 2016 | |
Contractors [Abstract] | |
Long-Term Contracts | Long-Term Contracts Additional information regarding engine contracts accounted for under the percentage-of-completion (“POC”) method is as follows: September 30, December 31, (in millions) Cumulative revenues recognized on uncompleted POC contracts $ 328.3 $ 215.0 Cumulative billings on uncompleted POC contracts 293.9 198.2 $ 34.4 $ 16.8 These amounts were included in the accompanying Consolidated Balance Sheets under the following captions: September 30, December 31, (in millions) Accounts receivable, net (POC revenue recognized in excess of billings) $ 38.8 $ 23.5 Accrued expenses (billings in excess of POC revenue recognized) (4.4 ) (6.7 ) $ 34.4 $ 16.8 Additional information regarding engine contracts accounted for under the completed-contract method is as follows: September 30, December 31, (in millions) Incurred costs relating to long-term contracts $ — $ 0.1 Progress payments related to long-term contracts (0.9 ) (1.0 ) Net balance associated with completed-contract inventories $ (0.9 ) $ (0.9 ) Incurred costs related to long-term contracts in the table above represent inventoried work in process and finished products related to engine contracts accounted for under the completed-contract method, where customer billings exceed costs incurred. Progress payments related to long-term contracts in the table above are either advanced billings or milestone billings to the customer on contracts accounted for under the completed-contract method. Upon shipment of the completed engine, revenue associated with the engine is recognized, and the incurred inventoried costs and progress payments are relieved. At September 30, 2016 and December 31, 2015 , progress payments related to long-term contracts shown above were in excess of incurred costs resulting in net liability balances. As such, the net liability balances are reflected in accrued expenses on the accompanying Consolidated Balance Sheets. Refer to Note 5, “Inventories” for additional information about incurred costs and progress payments related to long-term contracts for which the incurred costs exceeded the progress payments. In addition to inventoried costs, we also make deposits and progress payments to certain vendors for long lead time manufactured components associated with engine projects. At September 30, 2016 and December 31, 2015 , deposits and progress payments for long lead time components totaled $1.3 million and $1.8 million , respectively. These deposits and progress payments are classified in prepaid expenses and other current assets in the accompanying Consolidated Balance Sheets. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The changes in the net carrying value of goodwill by reportable segment for the nine months ended September 30, 2016 , are as follows: Sealing Products Engineered Products Power Systems Total (in millions) Goodwill as of December 31, 2015 $ 179.7 $ 9.1 $ 7.1 $ 195.9 Change due to acquisitions 7.8 — — 7.8 Change due to foreign currency translation (0.2 ) — — (0.2 ) Goodwill as of September 30, 2016 $ 187.3 $ 9.1 $ 7.1 $ 203.5 The goodwill balances reflected above are net of accumulated impairment losses of $27.8 million for the Sealing Products segment and $154.8 million for the Engineered Products segment as of September 30, 2016 and December 31, 2015 . Identifiable intangible assets are as follows: As of September 30, 2016 As of December 31, 2015 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (in millions) Amortized: Customer relationships $ 221.7 $ 122.8 $ 212.5 $ 112.0 Existing technology 62.6 29.0 63.0 26.9 Trademarks 36.0 19.5 35.3 18.4 Other 24.1 22.4 24.1 21.9 344.4 193.7 334.9 179.2 Indefinite-Lived: Trademarks 34.1 — 34.7 — Total $ 378.5 $ 193.7 $ 369.6 $ 179.2 Amortization expense for the quarters ended September 30, 2016 and 2015 was $ 5.3 million and $ 5.4 million , respectively. Amortization expense for the nine months ended September 30, 2016 and 2015 was $15.8 million and $16.4 million , respectively. |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Accrued Expenses September 30, December 31, (in millions) Salaries, wages and employee benefits $ 38.8 $ 42.8 Interest 25.3 36.7 Customer advances 7.2 8.9 Income and other taxes 15.9 10.3 Other 34.3 41.9 $ 121.5 $ 140.6 |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The historical business operations of Garlock Sealing Technologies LLC (“GST LLC”) and The Anchor Packing Company (“Anchor”) resulted in a substantial volume of asbestos litigation in which plaintiffs alleged personal injury or death as a result of exposure to asbestos fibers. Those subsidiaries manufactured and/or sold industrial sealing products, predominately gaskets and packing, that contained encapsulated asbestos fibers. Anchor is an inactive and insolvent indirect subsidiary of Coltec Industries Inc (“Coltec”), our direct subsidiary. Our subsidiaries’ exposure to asbestos litigation and their relationships with insurance carriers have been managed through another Coltec subsidiary, Garrison Litigation Management Group, Ltd. (“Garrison”). GST LLC, Anchor and Garrison are collectively referred to as “GST.” On June 5, 2010 (the "Petition Date"), GST commenced an asbestos claims resolution process under Chapter 11 of the United States Bankruptcy Code, which is ongoing. The resulting deconsolidation of GST from our financial results, discussed more fully in Note 16, "Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd." required certain intercompany indebtedness described below to be reflected on our Consolidated Balance Sheets. As of September 30, 2016 and December 31, 2015 , Coltec Finance Company Ltd., a wholly-owned subsidiary of Coltec, had aggregate, short-term borrowings of $27.8 million and $24.3 million , respectively, from GST’s subsidiaries in Mexico and Australia. These unsecured obligations were denominated in the currency of the lending party, and bear interest based on the applicable one-month interbank offered rate for each foreign currency involved. Effective as of January 1, 2010, Coltec entered into an original issue amount $73.4 million Amended and Restated Promissory Note due January 1, 2017 (the “Coltec Note”) in favor of GST LLC, and our subsidiary Stemco LP entered into an original issue amount $153.8 million Amended and Restated Promissory Note due January 1, 2017, in favor of GST LLC (the “Stemco Note”, and together with the Coltec Note, the “Notes Payable to GST”). The Notes Payable to GST amended and replaced promissory notes in the same principal amounts which were initially issued in March 2005, and which matured on January 1, 2010. We are currently in the process of attempting to extend the maturities of the Notes Payable to GST. The Notes Payable to GST bear interest at 11% per annum, of which 6.5% is payable in cash and 4.5% is added to the principal amount of the Notes Payable to GST as payment-in-kind (“PIK”) interest, with interest due on January 31 of each year. In conjunction with the interest payments in 2016 and 2015 , $18.4 million and $17.6 million , respectively, was paid in cash and PIK interest of $12.7 million and $12.2 million , respectively, was added to the principal balance of the Notes Payable to GST. If GST LLC is unable to pay ordinary course operating expenses, under certain conditions, it can require Coltec and Stemco to pay in cash the accrued PIK interest necessary to meet such ordinary course operating expenses, subject to certain caps. The interest due under the Notes Payable to GST may be satisfied through offsets of amounts due under intercompany services agreements pursuant to which we provide certain corporate services, make available access to group insurance coverage to GST, make advances to third party providers related to payroll and certain benefit plans sponsored by GST, and permit employees of GST to participate in certain of our benefit plans. The Coltec Note is secured by Coltec’s pledge of certain of its equity ownership in specified U.S. subsidiaries. The Stemco Note is guaranteed by Coltec and secured by Coltec’s pledge of its interest in Stemco. The Notes Payable to GST are subordinated to any obligations under our senior secured revolving credit facility described in Note 10, "Long-Term Debt - Revolving Credit Facility" under existing subordination agreements which subordinate GST LLC's right to receive payment of principal on the Notes Payable to GST to the prior payment in full of all obligations under such senior secured revolving credit facility. We regularly transact business with GST through the purchase and sale of products. We also provide services for GST including information technology, supply chain, treasury, accounting and tax administration, legal, and human resources under a support services agreement. GST is included in our consolidated U.S. federal income tax return and certain state combined income tax returns. As the parent of these consolidated tax groups, we are liable for, and pay, income taxes owed by the entire group. We have agreed with GST to allocate group taxes to GST based on the U.S. consolidated tax return regulations and current income tax accounting guidance. This method generally allocates taxes to GST as if it were a separate taxpayer. As a result, we carry an income tax receivable from GST related to this allocation. Amounts included in our consolidated financial statements arising from transactions with GST include the following: Consolidated Statements of Operations Caption Quarters Ended Nine Months Ended Description 2016 2015 2016 2015 (in millions) Sales to GST Net sales $ 6.8 $ 8.9 $ 20.4 $ 22.3 Purchases from GST Cost of sales $ 4.0 $ 5.2 $ 13.2 $ 15.9 Interest expense to GST Interest expense $ 8.4 $ 8.0 $ 25.0 $ 23.8 Description Consolidated Balance Sheets Caption September 30, December 31, (in millions) Due from GST Accounts receivable, net $ 15.4 $ 16.5 Income tax receivable from GST Deferred income taxes and income tax receivable $ 113.1 $ 100.6 Due from GST Other assets $ 1.4 $ 1.3 Due to GST Accounts payable $ 7.2 $ 8.0 Accrued interest to GST Accrued expenses $ 24.4 $ 31.2 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Senior Notes In September 2014, we completed an offering of $300 million aggregate principal amount of our 5.875% Senior Notes due 2022 (the “Senior Notes”). We issued the notes net of an original issue discount of $2.4 million . The Senior Notes are unsecured, unsubordinated obligations of EnPro and mature on September 15, 2022. Interest on the Senior Notes accrues at a rate of 5.875% per annum and is payable semi-annually in cash in arrears on March 15 and September 15 of each year. The debt discount is being amortized through interest expense until the maturity date resulting in an effective interest rate of 6.0% . The Senior Notes are required to be guaranteed on a senior unsecured basis by each of EnPro’s existing and future direct and indirect domestic subsidiaries that is a borrower under, or guarantees, our indebtedness under the Revolving Credit Facility or guarantees any other Capital Markets Indebtedness (as defined in the indenture governing the Senior Notes) of EnPro or any of the guarantors. On or after September 15, 2017, we may, on any one or more occasions, redeem all or a part of the Senior Notes at specified redemption prices plus accrued and unpaid interest. In addition, we may redeem a portion of the aggregate principal amount of the Senior Notes before September 15, 2017 with the net cash proceeds from certain equity offerings at a specified redemption price plus accrued and unpaid interest, if any. We may also redeem some or all of the Senior Notes before September 15, 2017 at a redemption price of 100% of the principal amount, plus accrued and unpaid interest, if any, plus a “make whole” premium. Each holder of the Senior Notes may require us to repurchase some or all of the Senior Notes for cash upon the occurrence of a defined “change of control” event. Our ability to redeem the Senior Notes prior to maturity is subject to certain conditions, including in certain cases the payment of make-whole amounts. The indenture governing the Senior Notes includes covenants that restrict our ability to engage in certain activities, including incurring additional indebtedness and paying dividends, subject in each case to specified exceptions and qualifications set forth in the indenture. Revolving Credit Facility We have a $300 million senior secured revolving credit facility (the “Revolving Credit Facility”). Borrowings under the Revolving Credit Facility bear interest at an annual rate of LIBOR plus 2.00% or base rate plus 1.00% , although the interest rates under the Revolving Credit Facility are subject to incremental increases or decreases based on a consolidated total leverage ratio. In addition, a commitment fee accrues with respect to the unused amount of the Revolving Credit Facility. Borrowings under the Revolving Credit Facility are secured by a first priority pledge of certain of our assets. The Revolving Credit Facility contains financial covenants and required financial ratios, including a maximum consolidated total net leverage and a minimum consolidated interest coverage as defined in the agreement. It also contains affirmative and negative covenants which are subject to customary exceptions and qualifications. We were in compliance with all such covenants as of September 30, 2016. The borrowing availability under our Revolving Credit Facility at September 30, 2016 was $121.6 million after giving consideration to $10.4 million of outstanding letters of credit and $168.0 million of outstanding revolver borrowings. In October 2016, the Revolving Credit Facility was amended to permit various transactions as part of the contemplated corporate restructuring of Coltec, which is discussed further in Note 16 - Garlock Sealing Technologies LLC. Permitted borrowers under the Revolving Credit Facility now include newly formed subsidiary, New Coltec, Inc. ("New Coltec"), in addition to EnPro and Coltec. Each of our domestic consolidated subsidiaries (other than GST and their respective subsidiaries, until they become consolidated subsidiaries in the future) is required to guarantee the obligations of the borrowers under the Revolving Credit Facility, and each of our existing domestic, consolidated subsidiaries (which does not include the domestic entities of GST) has provided such a guarantee, including, as part of the contemplated Coltec restructuring, newly formed subsidiaries, Fairbanks Morse, LLC and OldCo, LLC ("OldCo"). |
Pensions and Postretirement Ben
Pensions and Postretirement Benefits | 9 Months Ended |
Sep. 30, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Pensions and Postretirement Benefits | Pensions and Postretirement Benefits The components of net periodic benefit cost for the Company’s U.S. and foreign defined benefit pension and other postretirement plans for the quarters and nine months ended September 30, 2016 and 2015 , are as follows: Quarters Ended September 30, Nine Months Ended September 30, Pension Benefits Other Benefits Pension Benefits Other Benefits 2016 2015 2016 2015 2016 2015 2016 2015 (in millions) Service cost $ 1.0 $ 1.2 $ 0.1 $ 0.1 $ 3.2 $ 4.4 $ 0.3 $ 0.3 Interest cost 3.2 2.6 — 0.1 9.5 8.7 0.2 0.2 Expected return on plan assets (4.3 ) (4.7 ) — — (12.7 ) (14.1 ) — — Amortization of net loss 1.7 1.7 — — 5.1 5.3 — — Deconsolidation of GST (0.2 ) (0.2 ) — — (0.7 ) (0.6 ) — — Net periodic benefit cost $ 1.4 $ 0.6 $ 0.1 $ 0.2 $ 4.4 $ 3.7 $ 0.5 $ 0.5 For the nine months ended September 30, 2016 , we contributed $14.8 million to our U.S. defined benefit pension plan. Based upon available information, which is subject to change, no further contributions to our U.S defined benefit pension plan are anticipated in the remainder of 2016. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2016 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders' Equity In 2015, we adopted a policy under which we intend to declare regular quarterly cash dividends on our common stock, as determined by our board of directors, after taking into account our cash flows, earnings, financial position, debt covenants and other relevant matters. In accordance with this policy, total dividend payments of $13.6 million were made during the nine months ended September 30, 2016 . Cash dividends declared per common share for the quarter and nine months ended September 30, 2016 were $0.21 and $0.63 , respectively. On November 2, 2016, our board of directors authorized a dividend of $0.21 per share, payable on December 15, 2016 to all shareholders of record as of December 1, 2016. In October 2015, our board of directors authorized the repurchase of up to $50.0 million of our outstanding common shares. During the nine months ended September 30, 2016 , we repurchased 0.5 million shares for $25.8 million . Cash payments for repurchases that settled during the same period were $26.2 million . Subsequent to September 30, 2016 , we repurchased additional shares for $2.4 million through November 1, 2016. |
Business Segment Information
Business Segment Information | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Business Segment Information | Business Segment Information We aggregate our operating businesses into three reportable segments. The factors considered in determining our reportable segments are the economic similarity of the businesses, the nature of products sold or services provided, the production processes and the types of customers and distribution methods. Our reportable segments are managed separately based on these differences. Our Sealing Products segment designs, manufactures and sells sealing products, including: metallic, non-metallic and composite material gaskets, dynamic seals, compression packing, resilient metal seals, elastomeric seals, hydraulic components, expansion joints, flange sealing and isolation products, pipeline casing spacers/isolators, casing end seals, modular sealing systems for sealing pipeline penetrations, sanitary gaskets, hoses and fittings for the hygienic process industries, hole forming products, manhole infiltration sealing systems, bellows and bellows assemblies, pedestals for semiconductor manufacturing, PTFE products, and heavy-duty truck parts used in the wheel-end, braking, suspension, and tire and mileage optimization systems. Our Engineered Products segment includes operations that design, manufacture and sell self-lubricating, non-rolling metal-polymer, solid polymer and filament wound bearing products, aluminum blocks for hydraulic applications, and precision engineered components and lubrication systems for reciprocating compressors. Our Power Systems segment designs, manufactures, sells and services heavy-duty, medium-speed diesel, natural gas and dual fuel reciprocating engines and ancillary products. Segment profit is total segment revenue reduced by operating expenses, restructuring and other costs identifiable with the segment. Corporate expenses include general corporate administrative costs. Expenses not directly attributable to the segments, corporate expenses, net interest expense, asset impairments, gains and losses related to the sale of assets, and income taxes are not included in the computation of segment profit. The accounting policies of the reportable segments are the same as those for EnPro. Segment operating results and other financial data for the quarters and nine months ended September 30, 2016 and 2015 were as follows: Quarters Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 (in millions) Sales Sealing Products $ 175.3 $ 186.3 $ 532.6 $ 520.2 Engineered Products 65.7 72.1 213.5 227.8 Power Systems 52.5 49.1 157.2 137.2 293.5 307.5 903.3 885.2 Intersegment sales (0.8 ) (0.9 ) (2.5 ) (2.7 ) Net sales $ 292.7 $ 306.6 $ 900.8 $ 882.5 Segment Profit Sealing Products $ 23.1 $ 22.5 $ 62.4 $ 61.7 Engineered Products 2.9 1.5 10.4 8.9 Power Systems 7.3 9.2 15.5 16.1 Total segment profit 33.3 33.2 88.3 86.7 Corporate expenses (6.4 ) (6.3 ) (21.9 ) (19.5 ) Asbestos settlement — — (80.0 ) — Goodwill and other intangible asset impairment — — — (47.0 ) Interest expense, net (14.0 ) (12.8 ) (41.0 ) (38.6 ) Other expense, net (2.9 ) (1.9 ) (9.8 ) (8.4 ) Income (loss) before income taxes $ 10.0 $ 12.2 $ (64.4 ) $ (26.8 ) Segment assets are as follows: September 30, December 31, (in millions) Sealing Products $ 653.6 $ 631.7 Engineered Products 223.5 231.5 Power Systems 172.3 162.2 Corporate 532.1 473.4 $ 1,581.5 $ 1,498.8 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We utilize a fair value hierarchy that categorizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels: • Level 1: Observable inputs such as 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 our own assumptions. Assets and liabilities measured at fair value on a recurring basis are summarized as follows: Fair Value Measurements as of September 30, 2016 December 31, 2015 (in millions) Assets Time deposits $ 27.5 $ 24.2 Deferred compensation assets 6.4 5.4 $ 33.9 $ 29.6 Liabilities Deferred compensation liabilities $ 7.5 $ 6.6 Our time deposits and deferred compensation assets and liabilities are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices. The carrying values of our significant financial instruments reflected in the Consolidated Balance Sheets approximated their respective fair values except for the following instruments: September 30, 2016 December 31, 2015 Carrying Value Fair Value Carrying Value Fair Value (in millions) Long-term debt $ 462.6 $ 478.5 $ 356.3 $ 360.3 Notes payable to GST $ 295.9 $ 299.1 $ 283.2 $ 281.7 The fair values for long-term debt are based on quoted market prices for identical liabilities, but these would be considered Level 2 computations because the market is not active. The notes payable to GST computations would be considered Level 2 since they are based on rates available to us for debt with similar terms and maturities. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Loss Changes in accumulated other comprehensive loss by component (after tax) for the three months ended September 30, 2016 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (9.0 ) $ (47.1 ) $ (56.1 ) Other comprehensive loss before reclassifications (0.4 ) — (0.4 ) Amounts reclassified from accumulated other comprehensive loss — 1.0 1.0 Net current-period other comprehensive income (loss) (0.4 ) 1.0 0.6 Ending balance $ (9.4 ) $ (46.1 ) $ (55.5 ) Changes in accumulated other comprehensive loss by component (after tax) for the three months ended September 30, 2015 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ 6.6 $ (48.8 ) $ (42.2 ) Other comprehensive loss before reclassifications (4.9 ) — (4.9 ) Amounts reclassified from accumulated other comprehensive loss — 1.0 1.0 Net current-period other comprehensive income (loss) (4.9 ) 1.0 (3.9 ) Ending balance $ 1.7 $ (47.8 ) $ (46.1 ) Changes in accumulated other comprehensive loss by component (after tax) for the nine months ended September 30, 2016 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (4.9 ) $ (49.2 ) $ (54.1 ) Other comprehensive loss before reclassifications (4.3 ) — (4.3 ) Amounts reclassified from accumulated other comprehensive loss (0.2 ) 3.1 2.9 Net current-period other comprehensive income (loss) (4.5 ) 3.1 (1.4 ) Ending balance $ (9.4 ) $ (46.1 ) $ (55.5 ) Changes in accumulated other comprehensive loss by component (after tax) for the nine months ended September 30, 2015 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ 17.0 $ (51.1 ) $ (34.1 ) Other comprehensive loss before reclassifications (15.3 ) — (15.3 ) Amounts reclassified from accumulated other comprehensive loss — 3.3 3.3 Net current-period other comprehensive income (loss) (15.3 ) 3.3 (12.0 ) Ending balance $ 1.7 $ (47.8 ) $ (46.1 ) Reclassifications out of accumulated other comprehensive loss for the quarters and nine months ended September 30, 2016 and 2015 are as follows: Details about Accumulated Other Comprehensive Income Components Amount Reclassified from Accumulated Other Affected Statement of Operations Caption (in millions) Quarters Ended Nine Months Ended September 30, 2016 2015 2016 2015 Amortization of pension and other postretirement plans: Actuarial losses $ 1.7 $ 1.7 $ 5.1 $ 5.3 (1) Tax benefit (0.7 ) (0.7 ) (2.0 ) (2.0 ) Income tax expense Net of tax $ 1.0 $ 1.0 $ 3.1 $ 3.3 Release of unrealized currency translation adjustment upon sale of investment in foreign entity, net of tax $ — $ — $ (0.2 ) $ — Other non-operating expense (1) These accumulated other comprehensive income components are included in the computation of net periodic pension cost. (See Note 11, “Pensions and Postretirement Benefits” for additional details). |
Garlock Sealing Technologies LL
Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd. | 9 Months Ended |
Sep. 30, 2016 | |
Reorganizations [Abstract] | |
Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd. | Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd. On the Petition Date, GST LLC, Anchor and Garrison filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court (the "Bankruptcy Court"). The filings were the initial step in a claims resolution process, which is ongoing. The goal of the process is an efficient and permanent resolution of all pending and future asbestos claims through court approval of a plan of reorganization that will establish a facility to resolve and pay all GST asbestos claims. As described below, on March 17, 2016, we announced that we had reached a comprehensive consensual settlement to resolve current and future asbestos claims. In November 2011, GST filed an initial proposed plan of reorganization with the Bankruptcy Court. GST's initial plan called for a trust to be formed, to which GST and affiliates would contribute $200 million and which would be the exclusive remedy for future asbestos personal injury claimants – those whose claims arise after confirmation of the plan. The initial proposed plan provided that each present asbestos personal injury claim (any pending claim or one that arises between the Petition Date and plan confirmation) would be assumed by reorganized GST and resolved either by settlement, pursuant to a matrix contained in the proposed plan or as otherwise agreed, or by payment in full of any final judgment entered after trial in federal court. The initial proposed plan was revised and replaced by GST's first amended proposed plan of reorganization filed in May 2014. On April 13, 2012, the Bankruptcy Court granted a motion by GST for the Bankruptcy Court to estimate the allowed amount of present and future asbestos claims against GST for mesothelioma, a rare cancer attributed to asbestos exposure, for purposes of determining the feasibility of a proposed plan of reorganization. The estimation trial began on July 22, 2013 and concluded on August 22, 2013. On January 10, 2014, Bankruptcy Judge George Hodges announced his estimation decision in a 65-page order. Citing with approval the methodology put forth by GST at trial, the judge determined that $125 million is the amount sufficient to satisfy GST's liability for present and future mesothelioma claims. Judge Hodges adopted GST's "legal liability" approach to estimation, focused on the merits of claims, and rejected asbestos claimant representatives' approach, which focused solely on GST's historical settlement history. The judge's liability determination is for mesothelioma claims only. The court has not yet determined amounts for GST's liability for other asbestos claims and for administrative costs that would be required to review and process claims and payments, which will add to the amount. In his opinion, Judge Hodges wrote, "The best evidence of Garlock's aggregate responsibility is the projection of its legal liability that takes into consideration causation, limited exposure and the contribution of exposures to other products." The decision validated the positions that GST had been asserting for the more than four years it had been in the Chapter 11 process. Following are several important findings in the opinion: • Garlock's products resulted in a relatively low exposure to asbestos to a limited population, and its legal responsibility for causing mesothelioma is relatively de minimis . • Chrysotile, the asbestos fiber type used in almost all of Garlock's asbestos products, is far less toxic than other forms of asbestos. The court found reliable and persuasive Garlock's expert epidemiologist, who testified that there is no statistically significant association between low dose chrysotile exposure and mesothelioma. • The population that was exposed to Garlock's products was necessarily exposed to far greater quantities of higher potency asbestos from the products of others. • The estimates of Garlock's aggregate liability that are based on its historic settlement values are not reliable because those values are infected with the impropriety of some law firms and inflated by the cost of defense. In June 2014, the official committee representing current asbestos claimants (the "Current Asbestos Claimants' Committee") in GST's Chapter 11 proceedings filed a motion with the Bankruptcy Court asking the court to reopen the estimation process for further discovery and alleging that GST misled the court in various respects during the estimation trial. On December 4, 2014, the Bankruptcy Court denied the Current Asbestos Claimants' Committee's motion to reopen. In May 2014, GST filed its first amended proposed plan of reorganization. The first amended plan provided $ 275 million in total funding for (a) present and future asbestos claims against GST that have not been resolved by settlement or verdict prior to the Petition Date, and (b) administrative and litigation costs. On January 14, 2015, we announced that GST and we had reached an agreement with the court-appointed representative of future asbestos claimants (the "Future Claimants' Representative") in GST's Chapter 11 proceedings that included a second amended plan of reorganization. The second amended plan was filed with the Bankruptcy Court on January 14, 2015 and superseded the prior plans filed by GST. The Future Claimants' Representative agreed to support, recommend and vote in favor of the second amended plan. The second amended plan would provide for the establishment of two facilities – a settlement facility (which would receive $220 million from GST and $30 million from Coltec, as part of the "Parent Settlement" described below, upon consummation of the second amended plan and additional contributions from GST aggregating $ 77.5 million over the seven years) and a litigation fund (which would receive $ 30 million from GST) to fund the defense and payment of claims of claimants who elect to pursue litigation under the second amended plan rather than accept the settlement option under the second amended plan. Funds contained in the settlement facility and the litigation fund would provide the exclusive remedies for current and future GST asbestos claimants other than claimants whose claims had been resolved by settlement or verdict prior to the Petition Date and were not paid prior to the Petition Date. The second amended plan would provide that GST would pay in full claims that had been resolved by settlement or verdict prior to the Petition Date that were not paid prior to the Petition Date (with respect to claims resolved by verdict, such payment will be made only to the extent the verdict becomes final). The second amended plan would provide that if the actual amount of claims that had been resolved by settlement or verdict prior to the Petition Date that were not paid prior to the Petition Date is less than $ 17.0 million GST would contribute the difference to the settlement facility. In addition, the second amended plan would provide that, during the 40 -year period following confirmation of the second amended plan, GST would, if necessary, make supplementary annual contributions, subject to specified maximum annual amounts that decline over the period, to maintain a specified balance at specified dates of the litigation fund. Under the second amended plan, the maximum aggregate amount of all such contingent supplementary contributions over that period would be $ 132 million . GST and we believe that initial contributions to the litigation fund under the second amended plan would likely be sufficient to permit the balance of that facility to exceed the specified thresholds over the 40-year period and, accordingly, that the low end of a range of reasonably possible loss associated with these contingent supplementary contributions would be $ 0 . The second amended plan includes provisions referred to as the "Parent Settlement" for the resolution and extinguishment of any and all alleged derivative claims against us based on GST asbestos products and entry of an injunction that would permanently protect us from the assertion of such claims. As consideration for the Parent Settlement, (a) Coltec would contribute $30 million of the amount proposed to be paid into the settlement facility to pay future claimants, (b) Coltec will fund Anchor’s costs of dissolution (up to $ 500,000 ), (c) EnPro would guarantee all contributions to the settlement facility and litigation fund by GST after the effective date of consummation of the second amended plan, and (d) Coltec and its affiliates would subordinate their interests in certain insurance coverage to GST’s obligations to make payments to the settlement facility and litigation fund after the effective date of consummation of the second amended plan. Under the terms of the second amended plan, we would retain 100% of the equity interests of GST LLC. The second amended plan would also provide for the extinguishment of any derivative claims against us based on GST asbestos products and operations, but would not protect us or our other subsidiaries, including Coltec, from non-derivative asbestos claims. The Current Asbestos Claimants Committee and their law firms opposed the second amended plan of reorganization. While the Future Claimants' Representative has agreed to support the second amended plan of reorganization, GST continued to seek a consensual resolution that would also be acceptable to representatives of current asbestos claimants. On March 17, 2016, we announced that we had reached a comprehensive consensual settlement to resolve current and future asbestos claims. The settlement was reached with both the Future Claimants’ Representative and the Current Asbestos Claimants’ Committee, as well as with ad-hoc representatives for current and future asbestos claimants (the “Coltec Representatives”) against Coltec. The terms of the settlement are set forth in the Term Sheet for Permanent Resolution of All Present and Future GST Asbestos Claims and Coltec Asbestos Claims dated March 17, 2016 among EnPro, Coltec, GST, the Current Asbestos Claimants’ Committee, the Future Claimants’ Representative and the Coltec Representatives included as Exhibit 99.2 to our Form 8-K furnished to the Securities and Exchange Commission on March 18, 2016. Under the settlement, the Current Asbestos Claimants’ Committee, the Future Claimants’ Representative and the Coltec Representatives agreed to join GST and Coltec in proposing a joint plan of reorganization (the “Joint Plan”) that incorporates the settlement and to ask asbestos claimants and the court to approve the plan. The Joint Plan is subject to approval by the favorable vote of at least 75% of asbestos claimants who vote on the approval of the plan and by the Bankruptcy Court and the U.S. District Court for the Western District of North Carolina (the “District Court”) and, if so approved and consummated, would permanently resolve all current and future asbestos claims against GST and Coltec and would protect all of EnPro and its subsidiaries from those claims, under Section 524(g) of the U.S. Bankruptcy Code. The Joint Plan was filed with the Bankruptcy Court on May 20, 2016 and technical amendments to the Joint Plan were filed with the Bankruptcy Court on June 21, 2016 and July 29, 2016. On July 29, 2016, the Bankruptcy Court entered orders that, among other things, approved the disclosure statement for the Joint Plan, set December 9, 2016 as the deadline for asbestos claimants to vote on approving the Joint Plan, and scheduled the confirmation hearing on the Joint Plan to commence on May 15, 2017. The Joint Plan supersedes all prior plans of reorganization filed by GST in its Chapter 11 proceedings. If the Joint Plan is approved by asbestos claimants, the settlement contemplates that, as an appropriate and necessary step to facilitate the implementation of the settlement and not to delay or hinder creditors or the resolution of claims, Coltec will, subject to the receipt of necessary consents, undergo a corporate restructuring in which all of its significant operating assets and subsidiaries, which include each of our major business units, would be transferred into a new direct EnPro subsidiary, New Coltec”), which would also assume all of Coltec’s non-asbestos liabilities. The restructured Coltec, OldCo, would retain responsibility for all asbestos claims and rights to certain insurance assets. Upon completion of the restructuring, the settlement contemplates that OldCo will file a pre-packaged Chapter 11 bankruptcy petition, which we expect will be administered with GST’s Chapter 11 proceedings. While no current EnPro subsidiary other than GST LLC and Anchor has ever made indemnity payments to asbestos claimants, thousands of claims have been made in the past against Coltec and its present and former businesses based on alleged exposure to asbestos-containing gaskets and other components in equipment sold by those businesses. Coltec and its insurers have spent several million dollars defending those claims, and several thousand cases currently pending have been stayed during the pendency of GST’s Chapter 11 proceedings. The Joint Plan contemplates the establishment of a trust (the “Trust”) to be fully funded within a year of consummation of the Joint Plan. The Trust is to be funded (i) with aggregate cash contributions by GST LLC and Garrison of $370 million made at the effective date of the Joint Plan, (ii) by the contribution made by OldCo at the effective date of consummation of the Joint Plan of $30 million in cash and an option, exercisable one year after the effective date of consummation of the Joint Plan, permitting the Trust to purchase for $1 shares of EnPro common stock having a value of $20 million (with OldCo having the right to call the option for payment of $20 million in cash at any time prior to the first anniversary of the effective date, with the Trust having the right to put the option to OldCo for payment by OldCo of $20 million on the day prior to the first anniversary of the effective date and with the option terminating on the second anniversary of the effective date of consummation of the Joint Plan in return for payment to the Trust of $20 million), and (iii) by the obligation under the Joint Plan of OldCo to make a deferred contribution of $60 million in cash no later than one year after the effective date of the Joint Plan. This deferred contribution is to be guaranteed by EnPro and secured by a pledge of 50.1% of the outstanding voting equity interests of GST LLC and Garrison. The Joint Plan permits, at our election, any of these contributions to be funded by EnPro or any affiliate of EnPro. Under the Joint Plan, the Trust would assume responsibility for all present and future asbestos claims arising from the operations or products of GST or Coltec/OldCo. Under the Joint Plan, all non-asbestos creditors would be paid in full and EnPro would retain ownership of OldCo, GST LLC and Garrison. The settlement includes a number of conditions to the consummation of the Joint Plan, including that the plan documents (including the Joint Plan) are approved by EnPro, Coltec, GST, Current Asbestos Claimants’ Committee, the Future Claimants’ Representative and the Coltec Representatives, that 75% of the holders of asbestos claims who vote on the approval of the Joint Plan vote in favor of the Joint Plan, and that the Joint Plan be approved by the Bankruptcy Court and the District Court. In addition, EnPro, Coltec and GST’s obligations to proceed with the settlement are conditioned upon: • receipt of amendments, consents and waivers (the “Restructuring Consents”) as may be necessary under any binding agreements to permit the transactions and actions, including the restructuring of Coltec, outlined in an attachment to the settlement; • entry by EnPro, Coltec, GST and Garlock of Canada Ltd (an indirect subsidiary of GST LLC) into a written agreement, to be consummated concurrently with the effective date of consummation of the Joint Plan, with the Canadian provincial workers’ compensation boards (the “Provincial Boards”) resolving all remedies the Provincial Boards may possess under Canadian law or in the United States under U.S. law against Garlock of Canada Ltd, GST, Coltec or any of their affiliates, including releases and covenants not to sue, for any present or future asbestos-related claim, which agreement is approved by the Bankruptcy Court following notice to interested parties (or the Bankruptcy Court concludes that its approval is not required); and • receipt of a private letter ruling from the IRS that the Trust will be recognized as a “designated settlement fund” or “qualified settlement fund” under section 468B of the Internal Revenue Code, and any related regulations (or, if such a ruling is not available, a legal opinion satisfactory in form and substance to us that the IRS will so recognize the Trust). The confirmation and consummation of the Joint Plan, and accordingly the final resolution of asbestos claims against GST and Coltec in accordance with the Joint Plan, are subject to a number of risks and uncertainties, which could have the effect of delaying or preventing the confirmation and consummation of the Joint Plan, increasing our costs in connection with effecting the settlement and the consummation of the Joint Plan or reducing the benefit to us related to the consummation of the Joint Plan. In light of these risks and uncertainties, we cannot assure you that the Joint Plan will be consummated on the time schedule that we anticipate or at all, or if consummated that we will recognize all benefits from the consummation of the Joint Plan that we anticipate. Financial Results Condensed combined financial information for GST is set forth below, presented on a historical cost basis. GST (Debtor-in-Possession) Condensed Combined Statements of Operations (Unaudited) (in millions) Quarters Ended September 30, Nine Months Ended 2016 2015 2016 2015 Net sales $ 49.2 $ 54.0 $ 150.9 $ 165.2 Cost of sales 31.3 33.8 95.3 102.2 Gross profit 17.9 20.2 55.6 63.0 Operating expenses: Selling, general and administrative 10.0 10.6 31.3 33.0 Asbestos-related 0.1 0.3 50.1 0.4 Other 0.1 0.4 0.4 0.5 Total operating expenses 10.2 11.3 81.8 33.9 Operating income (loss) 7.7 8.9 (26.2 ) 29.1 Interest income, net 8.4 7.8 25.3 23.8 Income (loss) before reorganization expenses and income taxes 16.1 16.7 (0.9 ) 52.9 Reorganization expenses (6.8 ) (5.0 ) (14.8 ) (16.7 ) Income (loss) before income taxes 9.3 11.7 (15.7 ) 36.2 Income tax benefit (expense) (3.7 ) (5.1 ) 5.9 (12.6 ) Net income (loss) $ 5.6 $ 6.6 $ (9.8 ) $ 23.6 Comprehensive income (loss) $ 5.0 $ 0.6 $ (9.0 ) $ 13.6 GST (Debtor-in-Possession) Condensed Combined Statements of Cash Flows (Unaudited) Nine Months Ended September 30, 2016 and 2015 (in millions) 2016 2015 Net cash provided by operating activities $ 32.9 $ 44.5 Investing activities Purchases of property, plant and equipment (5.1 ) (3.6 ) Net payments on loans to affiliates (5.2 ) (3.6 ) Net purchase of held-to-maturity securities (50.5 ) (29.6 ) Other (0.2 ) — Net cash used in investing activities (61.0 ) (36.8 ) Effect of exchange rate changes on cash and cash equivalents 1.4 (3.3 ) Net increase (decrease) in cash and cash equivalents (26.7 ) 4.4 Cash and cash equivalents at beginning of period 71.9 66.0 Cash and cash equivalents at end of period $ 45.2 $ 70.4 GST (Debtor-in-Possession) Condensed Combined Balance Sheets (Unaudited) (in millions) September 30, December 31, Assets : Notes receivable from affiliate - current $ 295.9 $ 12.2 Other current assets 410.5 393.9 Asbestos insurance receivable 49.0 62.0 Deferred income taxes 126.8 105.6 Notes receivable from affiliate — 271.0 Other assets 67.7 67.8 Total assets $ 949.9 $ 912.5 Liabilities and Shareholder’s Equity : Current liabilities $ 33.9 $ 40.5 Other liabilities 117.6 114.4 Liabilities subject to compromise (A) 388.6 339.1 Total liabilities 540.1 494.0 Shareholder’s equity 409.8 418.5 Total liabilities and shareholder’s equity $ 949.9 $ 912.5 (A) Liabilities subject to compromise include pre-petition unsecured claims which may be resolved at amounts different from those recorded in the condensed combined balance sheets. Liabilities subject to compromise consist principally of asbestos-related claims. Per the terms of the comprehensive settlement agreement with the appointed committee representing current asbestos claimants and the court-appointed representative of future claimants in the GST asbestos claims resolution process pending before the Bankruptcy Court, GST has accrued $387.0 million as of September 30, 2016 for asbestos related claims. The accrual consists of of (a) $ 370 million to be contributed to the trust for present and future asbestos claims against GST plus litigation and administrative expenses, and (b) an estimate of $ 17.0 million for the resolution of all current and future Canadian asbestos claims alleging disease resulting in whole or in part from exposure to GST asbestos-containing products. See Note 17, “Commitments and Contingencies - Asbestos - Liability Estimate." |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies General A description of environmental, asbestos and other legal matters relating to certain of our subsidiaries is included in this section. In addition to the matters noted herein, we are from time to time subject to, and are presently involved in, other litigation and legal proceedings arising in the ordinary course of business. We believe the outcome of such other litigation and legal proceedings will not have a material adverse effect on our financial condition, results of operations and cash flows. Expenses for administrative and legal proceedings are recorded when incurred. Environmental Our facilities and operations are subject to federal, state and local environmental and occupational health and safety requirements of the U.S. and foreign countries. We take a proactive approach in our efforts to comply with environmental, health and safety laws as they relate to our manufacturing operations and in proposing and implementing any remedial plans that may be necessary. We also regularly conduct comprehensive environmental, health and safety audits at our facilities to maintain compliance and improve operational efficiency. Although we believe past operations were in substantial compliance with the then applicable regulations, we or one or more of our subsidiaries are involved with various remediation activities at 14 sites where the future cost per site for us or our subsidiary is expected to exceed $100,000 . Investigations have been completed for 10 sites and are in progress at the other 4 sites. Our costs at a majority of these sites relate to remediation projects at former operating facilities that were sold or closed and primarily deal with soil and water contamination. Our policy is to accrue environmental investigation and remediation costs when it is probable that a liability has been incurred and the amount can be reasonably estimated. The measurement of the liability is based on an evaluation of currently available facts with respect to each individual situation and takes into consideration factors such as existing technology, presently enacted laws and regulations and prior experience in remediation of contaminated sites. Liabilities are established for all sites based on these factors. As assessments and remediation progress at individual sites, these liabilities are reviewed periodically and adjusted to reflect additional technical data and legal information. As of September 30, 2016 and December 31, 2015 , we had accrued liabilities of $20.7 million and $16.8 million , respectively, for estimated future expenditures relating to environmental contingencies. In the quarter ended September 30, 2016, we accrued a $1.2 million liability to reflect our most current estimate of our share of certain EPA oversight costs associated with one site. These amounts have been recorded on an undiscounted basis in the Consolidated Balance Sheets. Given the uncertainties regarding the status of laws, regulations, enforcement policies, the impact of other parties potentially being liable, technology and information related to individual sites, we do not believe it is possible to develop an estimate of the range of reasonably possible environmental loss in excess of our recorded liabilities. Except as described below, we believe that our accruals for specific environmental liabilities are adequate for those liabilities based on currently available information. Actual costs to be incurred in future periods may vary from estimates because of the inherent uncertainties in evaluating environmental exposures due to unknown and changing conditions, changing government regulations and legal standards regarding liability. Based on our prior ownership of Crucible Steel Corporation a/k/a Crucible, Inc. (“Crucible”), we may have additional contingent liabilities in one or more significant environmental matters. One such matter, which is included in the 14 sites referred to above, is the Lower Passaic River Study Area of the Diamond Alkali Superfund Site in New Jersey. Crucible operated a steel mill abutting the Passaic River in Harrison, New Jersey from the 1930s until 1974, which was one of many industrial operations on the river dating back to the 1800s. Certain contingent environmental liabilities related to this site were retained by Coltec when Coltec sold a majority interest in Crucible Materials Corporation (the successor of Crucible) in 1985. The United States Environmental Protection Agency (the “EPA”) notified Coltec in September 2003 that it is a potentially responsible party (“PRP”) for Superfund response actions in the lower 17 -mile stretch of the Passaic River known as the Lower Passaic River Study Area. Coltec and approximately 70 of the numerous other PRPs, known as the Cooperating Parties Group, are parties to a May 2007 Administrative Order on Consent with the EPA to perform a Remedial Investigation/Feasibility Study (“RI/FS”) of the contaminants in the Lower Passaic River Study Area. The RI/FS was completed and submitted to the EPA in April 2015. The RI/FS recommends a targeted dredge and cap remedy with monitored natural recovery and adaptive management for the Lower Passaic River Study Area. The cost of such remedy is estimated to be $726 million . Previously, on April 11, 2014, the EPA released its Focused Feasibility Study (the “FFS”) with its proposed plan for remediating the lower eight miles of the Lower Passaic River Study Area. The FFS calls for bank-to-bank dredging and capping of the riverbed of that portion of the river and estimates a range of the present value of aggregate remediation costs of approximately $953 million to approximately $1.73 billion , although estimates of the costs and the timing of costs are inherently imprecise. On March 3, 2016, the EPA issued the final Record of Decision (ROD) as to the remedy for the lower eight miles of the Lower Passaic River Study Area, with the maximum estimated cost being reduced by the EPA from $1.73 billion to $1.38 billion , primarily due to a reduction in the amount of cubic yards of material that will be dredged. In October 2016, Occidental Chemical Corporation, the successor to the entity that operated the Diamond Alkali chemical manufacturing facility, reached an agreement with the EPA to develop the design for this proposed remedy at an estimated cost of $165 million . The EPA has estimated that it will take approximately four years to develop this design. No final allocations of responsibility have been made among the numerous PRPs that have received notices from the EPA, there are numerous identified PRPs that have not yet received PRP notices from the EPA, and there are likely many PRPs that have not yet been identified. Based on our evaluation of the site, during 2014 we accrued a liability of $3.5 million related to environmental remediation costs associated with the lower eight miles of the Lower Passaic River Study Area, which is our estimate of the low end of a range of reasonably possible costs, with no estimate within the range being a better estimate than the minimum. Our actual remediation costs could be significantly greater than the $3.5 million we accrued. With respect to the upper nine miles of the Lower Passaic River Study Area, we are unable to estimate a range of reasonably possible costs. Another such matter involves the Onondaga Lake Superfund Site (the “Onondaga Site”) located near Syracuse, New York. Crucible operated a steel mill facility adjacent to Onondaga Lake from 1911 to 1983. The New York State Department of Environmental Conservation (“NYSDEC”) has contacted the Company and Coltec, as well as other parties, demanding reimbursement of unquantified environmental response costs incurred by NYSDEC and the EPA at the Onondaga Site. NYSDEC and EPA have alleged that contamination from the Crucible facility contributed to the need for environmental response actions at the Onondaga Site. In addition, Honeywell International Inc. (“Honeywell”), which has undertaken certain remediation activities at the Onondaga Site under the supervision of NYSDEC and the EPA, has informed the Company that it has claims against Coltec related to investigation and remediation at the Onondaga Site. We have entered into tolling agreements with NYSDEC, the EPA and Honeywell. On May 4, 2016, we received from Honeywell a summary of its claims. We have corresponded with Honeywell and agreed to begin discussions with them regarding their claims. In addition, the Company has received notice from the Natural Resource Trustees for the Onondaga Lake Superfund Site (which are the U. S. Department of Interior, NYSDEC, and the Onondaga Nation) alleging that Coltec is considered to be a potentially responsible party for natural resource damages at the Onondaga Site. At this time, based on limited information we have with respect to estimated remediation costs and the respective allocation of responsibility for remediation among potentially responsible parties, we cannot estimate a reasonably possible range of loss associated with Crucible’s activities that may have affected the Onondaga Site. We have reserved approximately $1.5 million for reimbursement of EPA response costs and certain costs associated with the remedial investigation. Except with respect to specific Crucible environmental matters for which we have accrued a portion of the liability set forth above, including the Lower Passaic River Study Area, we are unable to estimate a reasonably possible range of loss related to any other contingent environmental liability based on our prior ownership of Crucible. See the section entitled “Crucible Steel Corporation a/k/a Crucible, Inc.” in this footnote for additional information. In addition to the Crucible environmental matters discussed above, Coltec has received a notice from the EPA asserting that Coltec is a potentially responsible party under CERCLA as the successor to a former operator in 1954 and 1955 of two uranium mines in Arizona. On October 15, 2015, Coltec received another notice from the EPA asserting that Coltec is a potentially responsible party as the successor to the former operator of six additional uranium mines in Arizona. At this time, although discussions with the EPA and other interested parties are ongoing, we have limited information regarding the sites and cannot estimate a reasonably possible range of loss associated with remediation or other costs at these sites. In 2015, we reserved $1.1 million for the minimum amount of probable loss associated with the first two sites identified by the EPA, including the cost of the investigative work to be conducted at such sites. During the second quarter of 2016, we reserved an additional $1.1 million for the minimum amount of probable loss associated with the six additional sites, which includes estimated costs of investigative work to be conducted at such sites, resulting in a total reserve of $2.2 million . In connection with the former operation of a division of Colt Industries Inc, located in Water Valley, Mississippi, which Coltec divested to BorgWarner, Inc. ("BorgWarner") in 1996, Coltec has been managing trichloroethylene soil and groundwater contamination at the site, which is included in the 14 sites referred to above. In February 2016, the Mississippi Department of Environmental Quality (MDEQ) issued an order against EnPro requiring evaluation of potential vapor intrusion into residential homes and commercial facilities located over the groundwater plume as well as requiring additional groundwater investigation and remediation. MDEQ performed the initial vapor intrusion investigations at certain residential and commercial sites, with the findings all being below the applicable screening level. The parties have entered into a new order including negotiated time frames for groundwater remediation. Pursuant to that order, MDEQ performed a second round of seasonable vapor intrusion sampling beginning in August. Results from sampling outside of three residences were above screening levels. Follow up sampling directly underneath those residences (either sub-slab or in crawl spaces) were all below applicable screening levels. Results from one more residential sampling location are pending. In addition, vapor intrusion sampling at the facility owned by BorgWarner is planned, with results expected to be received in the fourth quarter. As a result of these developments, in the first quarter of 2016, we reserved an additional $1.3 million to account for the investigation, additional remediation and long-term active monitoring necessary to comply with the orders. The remaining reserve at September 30, 2016 is $1.1 million . Based on the results of the pending and planned vapor intrusion testing and ongoing groundwater sampling, further modifications to the remediation system at the site may be required. In addition, it is our understanding that area homeowners, owners of commercial facilities and the local county government and possibly other private parties and individuals have engaged legal counsel to separately evaluate possible legal action relating to potential vapor intrusion and groundwater contamination. Based upon limited information regarding any further remediation that may be required at the site, we cannot estimate a reasonably possible range of loss. Colt Firearms and Central Moloney We may have contingent liabilities related to divested businesses for which certain of our subsidiaries retained liability or are obligated under indemnity agreements. These contingent liabilities include, but are not limited to, potential product liability and associated claims related to firearms manufactured prior to March 1990 by Colt Firearms, a former operation of Coltec, and for electrical transformers manufactured prior to May 1994 by Central Moloney, another former Coltec operation. We believe that these potential contingent liabilities are not material to our financial condition, results of operation and cash flows. Coltec also has ongoing obligations, which are included in other liabilities in our Consolidated Balance Sheets, with regard to workers’ compensation, retiree medical and other retiree benefit matters that relate to Coltec’s periods of ownership of these operations. Crucible Steel Corporation a/k/a Crucible, Inc. Crucible, which was engaged primarily in the manufacture and distribution of high technology specialty metal products, was a wholly owned subsidiary of Coltec until 1983 when its assets and liabilities were distributed to a new Coltec subsidiary, Crucible Materials Corporation. Coltec sold a majority of the outstanding shares of Crucible Materials Corporation in 1985 and divested its remaining minority interest in 2004. Crucible Materials Corporation filed for Chapter 11 bankruptcy protection in May 2009. We have certain ongoing obligations, which are included in other liabilities in our Consolidated Balance Sheets, including workers’ compensation, retiree medical and other retiree benefit matters, related to Coltec’s period of ownership of Crucible. Based on Coltec’s prior ownership of Crucible, we may have certain additional contingent liabilities, including liabilities in one or more significant environmental matters included in the matters discussed in “Environmental” above. We are investigating these matters. Except with respect to those matters for which we have an accrued liability as discussed in "Environmental" above, we are unable to estimate a reasonably possible range of loss related to these contingent liabilities. Warranties We provide warranties on many of our products. The specific terms and conditions of these warranties vary depending on the product and the market in which the product is sold. We record a liability based upon estimates of the costs we may incur under our warranties after a review of historical warranty experience and information about specific warranty claims. Adjustments are made to the liability as claims data and historical experience necessitate. Changes in the carrying amount of the product warranty liability for the nine months ended September 30, 2016 and 2015 are as follows: 2016 2015 (in millions) Balance at beginning of year $ 4.8 $ 3.5 Net charges to expense 3.3 2.0 Settlements made (3.4 ) (1.9 ) Balance at end of period $ 4.7 $ 3.6 BorgWarner A subsidiary of BorgWarner has asserted claims against GGB France E.U.R.L. (“GGB France”), with respect to certain bearings supplied by GGB France to BorgWarner and used by BorgWarner in manufacturing hydraulic control units included in motor vehicle automatic transmission units, that the bearings caused performance problems with the transmission units, leading to associated repairs and replacements. BorgWarner and GGB France are participating in a technical review before a panel of experts to determine, among other things, whether there were any defects in such bearings that were a cause of the damages claimed by BorgWarner, including whether GGB France was required to notify BorgWarner of a change in the source of a raw material used in the manufacture of such bearings. This technical review is a required predicate to the commencement of a legal proceeding for damages. In June 2016, the expert panel issued a preliminary report on technical matters considered by the experts. The preliminary report concluded that the change in the source of the raw material was a technical cause of the performance problems claimed by BorgWarner and that GGB France was obligated to notify BorgWarner regarding the change. A preliminary report of the expert panel on related financial matters is anticipated to be issued in or around the fourth quarter of 2016, which would be followed by a final report of the expert panel, which is anticipated to be issued relatively soon thereafter. We believe that GGB France has valid factual and legal defenses to these claims and we are vigorously defending these claims. Among GGB France’s legal defenses is a contractual disclaimer of consequential damages, which, if controlling, would limit GGB France’s liability to replacing the bearings at issue at a cost of approximately 0.4 million EUR, and that the determination of any duty to notify is a legal matter to be determined by the presiding court. We cannot estimate GGB France’s reasonably possible range of loss associated with this matter, but we estimate the minimum amount to be approximately 0.4 million EUR based on GGB's legal defenses described above. Accordingly, GGB France accrued $0.4 million during the second quarter of 2016 associated with this matter. AVL On December 17, 2014, AVL Powertrain Engineering, Inc. (“AVL”) filed a lawsuit against Fairbanks Morse alleging damages in connection with a contract dated August 28, 2008 between AVL and Fairbanks Morse pursuant to which AVL conducted engine testing services for certain AVL customers at certain of Fairbanks Morse’s facilities in Beloit, Wisconsin during the 2010 to 2012 time period. AVL claimed that it was unable to conduct its desired level of engine testing and asserted alternative damages theories based on rescission and lost profits. On April 21, 2016, Fairbanks Morse agreed to pay AVL $2.7 million to settle the lawsuit, in advance of a jury trial scheduled to begin on April 25, 2016 in the United States District Court for the Western District of Wisconsin. Our settlement decision followed certain negative developments that occurred in the weeks prior to the scheduled trial, including adverse pre-trial rulings and information obtained during the latter stages of discovery. The $2.7 million settlement is reflected in selling, general and administrative expense in the first quarter of 2016 in the accompanying Consolidated Statements of Operations. Asbestos Background on Asbestos-Related Litigation . The historical business operations of GST LLC and Anchor resulted in a substantial volume of asbestos litigation in which plaintiffs alleged personal injury or death as a result of exposure to asbestos fibers in products produced or sold by GST LLC or Anchor, together with products produced and sold by numerous other companies. GST LLC and Anchor manufactured and/or sold industrial sealing products that contained encapsulated asbestos fibers. Other of our subsidiaries that manufactured or sold equipment that may have at various times in the past contained asbestos-containing components have also been named in a number of asbestos lawsuits, but neither we nor any of our subsidiaries other than GST LLC and Anchor have ever paid an asbestos claim. Since the first asbestos-related lawsuits were filed against GST LLC in 1975, GST LLC and Anchor have processed more than 900,000 claims to conclusion, and, together with insurers, have paid over $1.4 billion in settlements and judgments and over $400 million in fees and expenses. Our subsidiaries’ exposure to asbestos litigation and their relationships with insurance carriers have been managed through Garrison. Subsidiary Chapter 11 Filing and Effect . On the Petition Date, GST LLC, Garrison and Anchor filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the Bankruptcy Court. The filings were the initial step in a claims resolution process, which is ongoing. See Note 16, "Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd." for additional information about this process and its impact on us. During the pendency of the Chapter 11 proceedings, certain actions proposed to be taken by GST not in the ordinary course of business are subject to approval by the Bankruptcy Court. As a result, during the pendency of these proceedings, we do not have exclusive control over these companies. Accordingly, as required by GAAP, GST was deconsolidated beginning on the Petition Date. As a result of the initiation of the Chapter 11 proceedings, the resolution of asbestos claims is subject to the jurisdiction of the Bankruptcy Court. The filing of the Chapter 11 cases automatically stayed the prosecution of pending asbestos bodily injury and wrongful death lawsuits, and initiation of new such lawsuits, against GST. Further, the Bankruptcy Court issued an order enjoining plaintiffs from bringing or further prosecuting asbestos products liability actions against affiliates of GST, including EnPro, Coltec and all their subsidiaries, during the pendency of the Chapter 11 proceedings, subject to further order. As a result, except as a result of the resolution of appeals from verdicts rendered prior to the Petition Date and the elimination of claims as a result of information obtained in the Chapter 11 proceedings, the numbers of asbestos claims pending against our subsidiaries have not changed since the Petition Date, and those numbers continue to be as reported in our 2009 Form 10-K and our quarterly reports for the first and second quarters of 2010. Pending Claims . On the Petition Date, according to Garrison's claim records, there were more than 90,000 total claims pending against GST LLC, of which approximately 5,800 were claims alleging the disease mesothelioma. Mesothelioma is a rare cancer of the protective lining of many of the body’s internal organs, principally the lungs. One cause of mesothelioma is believed to be exposure to asbestos. As a result of asbestos tort reform during the 2000s, most active asbestos-related lawsuits, and a large majority of the amount of payments made by our subsidiaries in the years immediately preceding the Petition Date, have been of claims alleging mesothelioma. In total, GST LLC has paid $563.2 million to resolve a total of 15,300 mesothelioma claims, and another 5,700 mesothelioma claims have been dismissed without payment. In order to estimate the allowed amount for mesothelioma claims against GST, the Bankruptcy Court approved a process whereby all current GST LLC mesothelioma claimants were required to respond to a questionnaire about their claims. Questionnaires were distributed to the mesothelioma claimants identified in Garrison’s claims database. Many of the 5,800 claimants (over 500 ) did not respond to the questionnaire at all; many others (more than 1,900 ) clarified that: claimants do not have mesothelioma, claimants cannot establish exposure to GST products, claims were dismissed, settled or withdrawn, claims were duplicates of other filed claims, or claims were closed or inactive. Still others responded to the questionnaire but their responses were deficient in some material respect. As a result of this process, less than 3,300 claimants presented questionnaires asserting mesothelioma claims against GST LLC as of the Petition Date and many of them either did not establish exposure to GST products or had claims that are otherwise deficient. Since the Petition Date, many asbestos-related lawsuits have been filed by claimants against other companies in state and federal courts, and many of those claimants might also have included GST LLC as a defendant but for the bankruptcy injunction. Claims Filed in GST Chapter 11 . Proofs of claim involving approximately 180,000 claims were filed on or prior to October 6, 2015, the claims bar date established in connection with the second amended plan of reorganization in GST's Chapter 11 proceedings. Many of the more than 90,000 pre-petition claims are likely among the approximately 180,000 claims filed in GST's Chapter 11 proceedings. Approximately 10,000 of the claims filed in GST's Chapter 11 proceedings allege mesothelioma, many of the pre-petition mesothelioma claims likely among those claims. Based on its preliminary analysis, GST believes that a significant number of such claims were resolved and paid by GST prior to the Petition Date, had been dismissed with prejudice prior to the Petition Date or are time-barred under applicable statutes of limitations. The Joint Plan will provide for a new claims bar date by which proofs of claims for asbestos-related diseases allegedly caused by Coltec must be filed with the Bankruptcy Court or be subject to being forever barred by order of the Bankruptcy Court. Product Defenses . We believe that the asbestos-containing products manufactured or sold by GST could not have been a substantial contributing cause of any asbestos-related disease. The asbestos in the products was encapsulated, which means the asbestos fibers incorporated into the products during the manufacturing process were sealed in binders. The products were also nonfriable, which means they could not be crumbled by hand pressure. The U.S. Occupational Safety and Health Administration, which began generally requiring warnings on asbestos-containing products in 1972, has never required that a warning be placed on products such as GST LLC’s gaskets. Even though no warning label was required, GST LLC included one on all of its asbestos-containing products beginning in 1978. Further, gaskets such as those previously manufactured and sold by GST LLC are one of the few asbestos-containing products still permitted to be manufactured under regulations of the U.S. Environmental Protection Agency. Nevertheless, GST LLC discontinued all manufacture and distribution of asbestos-containing products in the U.S. during 2000 and worldwide in mid-2001. Appeals . GST LLC has a record of success in trials of asbestos cases, especially before the bankruptcies of many of the historically significant asbestos defendants that manufactured raw asbestos, asbestos insulation, refractory products or other dangerous friable asbestos products. However, it has on occasion lost jury verdicts at trial. GST has consistently appealed when it has received an adverse verdict and has had success in a majority of those appeals. GST LLC won a reversal of an adverse verdict in one of three recent appellate decisions. In September 2011, the United States Court of Appeals for the Sixth Circuit overturned a $500,000 verdict against GST LLC that was handed down in 2009 by a Kentucky federal court jury. The federal appellate court found that GST LLC’s motion for judgment as a matter of law should have been granted because the evidence was not sufficient to support a determination of liability. The Sixth Circuit’s chief judge wrote that, “On the basis of this record, saying that exposure to Garlock gaskets was a substantial cause of [claimant’s] mesothelioma would be akin to saying that one who pours a bucket of water into the ocean has substantially contributed to the ocean’s volume.” In May 2011, a three-judge panel of the Kentucky Court of Appeals upheld GST LLC’s $700,000 share of a 2009 jury verdict, which included punitive damages, in a lung cancer case against GST LLC in Kentucky state court. This verdict, which was secured by a bond pending the appeal, was paid in June 2012. In a Kentucky appeal from a 2006 verdict against GST LLC, another Kentucky Court of Appeals panel upheld, in August 2014, GST LLC's share of the verdict and a $600,000 punitive damage award. The verdict against GST LLC totaled $874,000 . This verdict and post-judgment interest were secured by a bond in the amount of $1.1 million . The plaintiff in the case agreed to resolve the case, including claims for post-judgment interest, for the amount of the bond and to forego additional accrued interest on the verdict, and GST LLC agreed to discontinue further appeals. Because we were responsible to the bonding company for the bond amount, our Coltec subsidiary purchased the verdict from the plaintiff in September 2014 for the amount of the $1.1 million bond. As a result, Coltec has a claim against GST LLC for the amount of the judgment, including post-judgment interest. Insurance Coverage . At September 30, 2016 we had $62.0 million of insurance coverage we believe is available to cover current and future GST asbestos claims payments and certain expense payments. GST has collected insurance payments totaling $134.6 million since the Petition Date, including $18.0 million collected in the first nine months of 2016. We consider the $62.0 million of available insurance coverage remaining to be of high quality because the insurance policies are written or guaranteed by U.S.-based carriers whose credit rating by S&P is investment grade (BBB-) or better, and whose AM Best rating is excellent (A-) or better. Of the $62.0 million , $25.9 million is allocated to claims that were paid by GST LLC prior to the initiation of the Chapter 11 proceedings and submitted to insurance companies for reimbursement, and the remainder is allocated to pending and estimated future claims. There are specific agreements in place with carriers covering $28.2 million of the remaining available coverage. Based on those agreements and the terms of the policies in place and prior decisions concerning coverage, we believe that all of the $62.0 million of insurance proceeds will ultimately be collected, although there can be no assurance that the insurance companies will make the payments as and when due. Based on those agreements and policies, some of which define specific annual amounts to be paid and others of which limit the amount that can be recovered in any one year, we anticipate that $38.0 million will become collectible at the conclusion of GST’s Chapter 11 proceeding and, assuming the insurers pay according to the agreements and policies, that the following amounts should be collected in the years set out below regardless of when the case concludes: 2017 – $13 million 2018 – $11 million GST LLC has received $8.6 million of insurance recoveries from insolvent carriers since 2007, and may receive additional payments from insolvent carriers in the future. No anticipated insolvent carrier collections are included in the $62.0 million of anticipated collections. The insurance available to cover current and future asbestos claims is from comprehensive general liability policies that cover Coltec and certain of its other subsidiaries in addition to GST LLC for periods prior to 1985 and therefore could be subject to potential competing claims of other covered subsidiaries and their assignees. Liability Estimate . Our recorded asbestos liability as of the Petition Date was $472.1 million . We based that recorded liability on an estimate of probable and estimable expenditures to resolve asbestos personal injury claims under generally accepted accounting principles, made with the assistance of Garrison and an estimation expert, Bates White, retained by GST LLC’s counsel. The estimate developed was an estimate of the most likely point in a broad range of potential amounts that GST LLC might pay to resolve asbestos claims (by settlement in the majorit |
Supplemental Guarantor Financia
Supplemental Guarantor Financial Information | 9 Months Ended |
Sep. 30, 2016 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Supplemental Guarantor Financial Information | Supplemental Guarantor Financial Information In September 2014, we completed the offering of our Senior Notes. The Senior Notes are fully and unconditionally guaranteed on an unsecured, unsubordinated, joint and several basis by our existing and future 100% owned direct and indirect domestic subsidiaries, which does not include GST and the domestic subsidiaries of GST, that are each guarantors of our Revolving Credit Facility (collectively, the “Guarantor Subsidiaries”). Our subsidiaries organized outside of the United States, (collectively, the “Non-Guarantor Subsidiaries”) do not guarantee the Senior Notes. A Guarantor Subsidiary's guarantee is subject to release in certain circumstances, including (i) the sale, disposition, exchange or other transfer (including through merger, consolidation, amalgamation or otherwise) of the capital stock of the subsidiary made in a manner not in violation of the indenture governing the Senior Notes; (ii) the designation of the subsidiary as an “Unrestricted Subsidiary” under the indenture governing the Senior Notes; (iii) the legal defeasance or covenant defeasance of the Senior Notes in accordance with the terms of the indenture; or (iv) the subsidiary ceasing to be a subsidiary of the Company as a result of any foreclosure of any pledge or security interest securing our Revolving Credit Facility or other exercise of remedies in respect thereof. The following tables present condensed consolidating financial information for EnPro Industries, Inc. (the "Parent"), the Guarantor Subsidiaries on a combined basis, the Non-Guarantor Subsidiaries on a combined basis and the eliminations necessary to arrive at our consolidated results. The consolidating financial information reflects our investments in subsidiaries using the equity method of accounting. These tables are not intended to present our results of operations, cash flows or financial condition for any purpose other than to comply with the specific requirements for subsidiary guarantor reporting. Our December 31, 2015 Condensed Consolidating Balance Sheet that was presented in our Supplemental Guarantor Financial Information footnote in the SEC Form 10-K for the year ended December 31, 2015 reflects the retrospective adoption of a standard in the first quarter of 2016 that amends existing guidance to require the presentation of debt issuance costs in the balance sheet as a deduction from the carrying amount of the related debt liability instead of a deferred charge. The impact on the Parent's and the Consolidated column's previously issued financial information is a decrease of $4.7 million to Other assets and Long-term debt. The adjustments had no impact on the Condensed Consolidating Statement of Operations or Condensed Consolidating Statement of Cash Flows for the three and nine months ended September 30, 2015 . Refer to Note 1, "Overview, Basis of Presentation, and Recently Issued Authoritative Accounting Guidance" for more information about this revision. ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended September 30, 2016 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 207.1 $ 105.1 $ (19.5 ) $ 292.7 Cost of sales — 144.8 68.8 (19.5 ) 194.1 Gross profit — 62.3 36.3 — 98.6 Operating expenses: Selling, general and administrative 6.3 37.9 26.7 — 70.9 Other 0.4 0.1 1.9 — 2.4 Total operating expenses 6.7 38.0 28.6 — 73.3 Operating income (loss) (6.7 ) 24.3 7.7 — 25.3 Interest expense, net (4.7 ) (9.3 ) — — (14.0 ) Other expense — (1.2 ) (0.1 ) — (1.3 ) Income (loss) before income taxes (11.4 ) 13.8 7.6 — 10.0 Income tax benefit (expense) 8.4 (8.2 ) (4.2 ) — (4.0 ) Income (loss) before equity in earnings of subsidiaries (3.0 ) 5.6 3.4 — 6.0 Equity in earnings of subsidiaries, net of tax 9.0 3.4 — (12.4 ) — Net income $ 6.0 $ 9.0 $ 3.4 $ (12.4 ) $ 6.0 Comprehensive income $ 6.6 $ 9.5 $ 3.0 $ (12.5 ) $ 6.6 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended September 30, 2015 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 212.9 $ 112.9 $ (19.2 ) $ 306.6 Cost of sales — 147.2 77.2 (19.2 ) 205.2 Gross profit — 65.7 35.7 — 101.4 Operating expenses: Selling, general and administrative 6.5 40.7 27.6 — 74.8 Other 0.7 0.6 0.4 — 1.7 Total operating expenses 7.2 41.3 28.0 — 76.5 Operating income (loss) (7.2 ) 24.4 7.7 — 24.9 Interest expense, net (4.7 ) (8.0 ) (0.1 ) — (12.8 ) Other income — 0.1 — — 0.1 Income (loss) before income taxes (11.9 ) 16.5 7.6 — 12.2 Income tax benefit (expense) 2.3 (1.0 ) (2.1 ) — (0.8 ) Income (loss) before equity in earnings of subsidiaries (9.6 ) 15.5 5.5 — 11.4 Equity in earnings of subsidiaries, net of tax 21.0 5.5 — (26.5 ) — Net income $ 11.4 $ 21.0 $ 5.5 $ (26.5 ) $ 11.4 Comprehensive income $ 7.5 $ 17.1 $ 0.5 $ (17.6 ) $ 7.5 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2016 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 630.2 $ 333.9 $ (63.3 ) $ 900.8 Cost of sales — 442.0 218.0 (63.3 ) 596.7 Gross profit — 188.2 115.9 — 304.1 Operating expenses: Selling, general and administrative 20.8 124.2 86.7 — 231.7 Asbestos settlement — 80.0 — — 80.0 Other 1.7 2.9 5.8 — 10.4 Total operating expenses 22.5 207.1 92.5 — 322.1 Operating income (loss) (22.5 ) (18.9 ) 23.4 — (18.0 ) Interest expense, net (13.9 ) (26.9 ) (0.2 ) — (41.0 ) Other expense — (5.1 ) (0.3 ) — (5.4 ) Income (loss) before income taxes (36.4 ) (50.9 ) 22.9 — (64.4 ) Income tax benefit (expense) 13.1 28.3 (14.2 ) — 27.2 Income (loss) before equity in earnings of subsidiaries (23.3 ) (22.6 ) 8.7 — (37.2 ) Equity in earnings of subsidiaries, net of tax (13.9 ) 8.7 — 5.2 — Net income (loss) $ (37.2 ) $ (13.9 ) $ 8.7 $ 5.2 $ (37.2 ) Comprehensive income (loss) $ (38.6 ) $ (15.4 ) $ 4.2 $ 11.2 $ (38.6 ) ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2015 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 609.7 $ 312.6 $ (39.8 ) $ 882.5 Cost of sales — 426.1 203.7 (39.8 ) 590.0 Gross profit — 183.6 108.9 — 292.5 Operating expenses: Selling, general and administrative 18.7 118.0 89.5 — 226.2 Goodwill and other intangible asset impairment — 5.6 41.4 — 47.0 Other 0.9 0.6 1.8 — 3.3 Total operating expenses 19.6 124.2 132.7 — 276.5 Operating income (loss) (19.6 ) 59.4 (23.8 ) — 16.0 Interest expense, net (8.5 ) (29.9 ) (0.2 ) — (38.6 ) Other expense (2.8 ) (1.4 ) — — (4.2 ) Income (loss) before income taxes (30.9 ) 28.1 (24.0 ) — (26.8 ) Income tax benefit (expense) 8.0 (5.1 ) (3.6 ) — (0.7 ) Income (loss) before equity in earnings of subsidiaries (22.9 ) 23.0 (27.6 ) — (27.5 ) Equity in earnings of subsidiaries, net of tax (4.6 ) (27.6 ) — 32.2 — Net loss $ (27.5 ) $ (4.6 ) $ (27.6 ) $ 32.2 $ (27.5 ) Comprehensive loss $ (39.5 ) $ (16.6 ) $ (42.7 ) $ 59.3 $ (39.5 ) ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2016 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ (51.6 ) $ 33.9 $ 25.6 $ — $ 7.9 INVESTING ACTIVITIES Purchases of property, plant and equipment — (19.5 ) (5.1 ) — (24.6 ) Payments for capitalized internal-use software — (2.8 ) (0.3 ) — (3.1 ) Acquisitions, net of cash acquired — (25.5 ) (3.0 ) — (28.5 ) Other — 2.9 0.8 — 3.7 Net cash used in investing activities — (44.9 ) (7.6 ) — (52.5 ) FINANCING ACTIVITIES Net payments on loans between subsidiaries 94.5 (95.2 ) 0.7 — — Proceeds from debt — 297.2 6.1 — 303.3 Repayments of debt — (191.7 ) (1.0 ) — (192.7 ) Repurchase of common stock (26.2 ) — — — (26.2 ) Dividends paid (13.6 ) — — — (13.6 ) Other (3.1 ) — — — (3.1 ) Net cash provided by financing activities 51.6 10.3 5.8 — 67.7 Effect of exchange rate changes on cash and cash equivalents — — (11.7 ) — (11.7 ) Net increase (decrease) in cash and cash equivalents — (0.7 ) 12.1 — 11.4 Cash and cash equivalents at beginning of period — 0.7 102.7 — 103.4 Cash and cash equivalents at end of period $ — $ — $ 114.8 $ — $ 114.8 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2015 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ (36.6 ) $ 45.7 $ 22.9 $ — $ 32.0 INVESTING ACTIVITIES Purchases of property, plant and equipment (0.1 ) (17.8 ) (5.5 ) — (23.4 ) Payments for capitalized internal-use software — (2.5 ) (1.1 ) — (3.6 ) Acquisitions, net of cash acquired — (42.4 ) (3.1 ) — (45.5 ) Other — 0.1 0.2 — 0.3 Net cash used in investing activities (0.1 ) (62.6 ) (9.5 ) — (72.2 ) FINANCING ACTIVITIES Net payments on loans between subsidiaries 177.5 (175.9 ) (1.6 ) — — Proceeds from debt — 177.7 3.6 — 181.3 Repayments of debt (23.3 ) (99.8 ) — — (123.1 ) Repurchase of common stock (80.0 ) — — — (80.0 ) Dividends paid (13.8 ) — — — (13.8 ) Repurchase of convertible debentures conversion option (21.6 ) — — — (21.6 ) Other (2.1 ) — — — (2.1 ) Net cash provided by (used in) financing activities 36.7 (98.0 ) 2.0 — (59.3 ) Effect of exchange rate changes on cash and cash equivalents — — (2.7 ) — (2.7 ) Net increase (decrease) in cash and cash equivalents — (114.9 ) 12.7 — (102.2 ) Cash and cash equivalents at beginning of period — 114.9 79.3 — 194.2 Cash and cash equivalents at end of period $ — $ — $ 92.0 $ — $ 92.0 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING BALANCE SHEETS (UNAUDITED) As of September 30, 2016 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets Cash and cash equivalents $ — $ — $ 114.8 $ — $ 114.8 Accounts receivable, net — 162.6 60.0 — 222.6 Intercompany receivables — 8.2 5.9 (14.1 ) — Inventories — 124.9 54.0 — 178.9 Prepaid expenses and other current assets 26.9 8.5 13.8 (12.6 ) 36.6 Total current assets 26.9 304.2 248.5 (26.7 ) 552.9 Property, plant and equipment, net 0.1 144.4 71.7 — 216.2 Goodwill — 175.4 28.1 — 203.5 Other intangible assets — 161.0 23.8 — 184.8 Investment in GST — 236.9 — — 236.9 Intercompany receivables 7.8 49.9 1.0 (58.7 ) — Investment in subsidiaries 689.4 246.2 — (935.6 ) — Other assets 16.4 150.7 20.1 — 187.2 Total assets $ 740.6 $ 1,468.7 $ 393.2 $ (1,021.0 ) $ 1,581.5 LIABILITIES AND EQUITY Current liabilities Short-term borrowings from GST $ — $ — $ 27.8 $ — $ 27.8 Notes payable to GST — 295.9 — — 295.9 Current maturities of long-term debt — 0.1 — — 0.1 Accounts payable 1.0 52.2 35.9 — 89.1 Intercompany payables — 5.9 8.2 (14.1 ) — Accrued expenses 7.6 83.4 43.1 (12.6 ) 121.5 Total current liabilities 8.6 437.5 115.0 (26.7 ) 534.4 Long-term debt 293.9 168.6 — — 462.5 Intercompany payables 40.7 8.1 9.9 (58.7 ) — Other liabilities 13.3 165.1 22.1 — 200.5 Total liabilities 356.5 779.3 147.0 (85.4 ) 1,197.4 Shareholders’ equity 384.1 689.4 246.2 (935.6 ) 384.1 Total liabilities and equity $ 740.6 $ 1,468.7 $ 393.2 $ (1,021.0 ) $ 1,581.5 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING BALANCE SHEETS (UNAUDITED) As of December 31, 2015 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets Cash and cash equivalents $ — $ 0.7 $ 102.7 $ — $ 103.4 Accounts receivable, net 0.1 153.2 59.2 — 212.5 Intercompany receivables — 8.1 11.7 (19.8 ) — Inventories — 126.4 52.0 — 178.4 Prepaid expenses and other current assets 13.6 11.2 9.9 (11.1 ) 23.6 Total current assets 13.7 299.6 235.5 (30.9 ) 517.9 Property, plant and equipment, net 0.1 135.1 76.3 — 211.5 Goodwill — 167.6 28.3 — 195.9 Other intangible assets — 162.6 27.8 — 190.4 Investment in GST — 236.9 — — 236.9 Intercompany receivables 65.8 12.7 1.4 (79.9 ) — Investment in subsidiaries 693.0 241.8 — (934.8 ) — Other assets 14.8 122.0 19.3 (9.9 ) 146.2 Total assets $ 787.4 $ 1,378.3 $ 388.6 $ (1,055.5 ) $ 1,498.8 LIABILITIES AND EQUITY Current liabilities Short-term borrowings from GST $ — $ — $ 24.3 $ — $ 24.3 Notes payable to GST — 12.2 — — 12.2 Current maturities of long-term debt — 0.1 — — 0.1 Accounts payable 2.3 59.3 39.9 — 101.5 Intercompany payables — 11.7 8.1 (19.8 ) — Accrued expenses 17.7 89.6 44.4 (11.1 ) 140.6 Total current liabilities 20.0 172.9 116.7 (30.9 ) 278.7 Long-term debt 293.3 62.9 — — 356.2 Notes payable to GST — 271.0 — — 271.0 Intercompany payables 4.2 66.1 9.6 (79.9 ) — Other liabilities 10.1 112.4 20.5 (9.9 ) 133.1 Total liabilities 327.6 685.3 146.8 (120.7 ) 1,039.0 Shareholders’ equity 459.8 693.0 241.8 (934.8 ) 459.8 Total liabilities and equity $ 787.4 $ 1,378.3 $ 388.6 $ (1,055.5 ) $ 1,498.8 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings Per Share | Quarters Ended Nine Months Ended 2016 2015 2016 2015 (in millions, except per share amounts) Numerator (basic and diluted): Net income (loss) $ 6.0 $ 11.4 $ (37.2 ) $ (27.5 ) Denominator: Weighted-average shares – basic 21.5 22.0 21.7 22.7 Share-based awards 0.2 0.1 — — Weighted-average shares – diluted 21.7 22.1 21.7 22.7 Earnings (loss) per share: Basic $ 0.28 $ 0.52 $ (1.71 ) $ (1.21 ) Diluted $ 0.28 $ 0.51 $ (1.71 ) $ (1.21 ) |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | September 30, December 31, (in millions) Finished products $ 106.5 $ 110.2 Work in process 25.0 25.6 Raw materials and supplies 52.7 49.0 184.2 184.8 Reserve to reduce certain inventories to LIFO basis (11.3 ) (11.3 ) Manufacturing inventories 172.9 173.5 Incurred costs relating to long-term contracts 13.4 10.9 Progress payments related to long-term contracts (7.4 ) (6.0 ) Net balance associated with completed-contract inventories 6.0 4.9 Total inventories $ 178.9 $ 178.4 |
Long-Term Contracts (Tables)
Long-Term Contracts (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Contractors [Abstract] | |
Schedule of Information Regarding Contracts Accounted for Under Percentage-of-Completion Method | Additional information regarding engine contracts accounted for under the percentage-of-completion (“POC”) method is as follows: September 30, December 31, (in millions) Cumulative revenues recognized on uncompleted POC contracts $ 328.3 $ 215.0 Cumulative billings on uncompleted POC contracts 293.9 198.2 $ 34.4 $ 16.8 |
Schedule of Uncompleted Contracts Reflected in Consolidated Balance Sheets | These amounts were included in the accompanying Consolidated Balance Sheets under the following captions: September 30, December 31, (in millions) Accounts receivable, net (POC revenue recognized in excess of billings) $ 38.8 $ 23.5 Accrued expenses (billings in excess of POC revenue recognized) (4.4 ) (6.7 ) $ 34.4 $ 16.8 |
Schedule of Completed-Contract Method Contracts [Table Text Block] | Additional information regarding engine contracts accounted for under the completed-contract method is as follows: September 30, December 31, (in millions) Incurred costs relating to long-term contracts $ — $ 0.1 Progress payments related to long-term contracts (0.9 ) (1.0 ) Net balance associated with completed-contract inventories $ (0.9 ) $ (0.9 ) |
Goodwill and Other Intangible27
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Net Carrying Value of Goodwill by Reportable Segment | The changes in the net carrying value of goodwill by reportable segment for the nine months ended September 30, 2016 , are as follows: Sealing Products Engineered Products Power Systems Total (in millions) Goodwill as of December 31, 2015 $ 179.7 $ 9.1 $ 7.1 $ 195.9 Change due to acquisitions 7.8 — — 7.8 Change due to foreign currency translation (0.2 ) — — (0.2 ) Goodwill as of September 30, 2016 $ 187.3 $ 9.1 $ 7.1 $ 203.5 |
Schedule of Identifiable Intangible Assets | Identifiable intangible assets are as follows: As of September 30, 2016 As of December 31, 2015 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (in millions) Amortized: Customer relationships $ 221.7 $ 122.8 $ 212.5 $ 112.0 Existing technology 62.6 29.0 63.0 26.9 Trademarks 36.0 19.5 35.3 18.4 Other 24.1 22.4 24.1 21.9 344.4 193.7 334.9 179.2 Indefinite-Lived: Trademarks 34.1 — 34.7 — Total $ 378.5 $ 193.7 $ 369.6 $ 179.2 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | September 30, December 31, (in millions) Salaries, wages and employee benefits $ 38.8 $ 42.8 Interest 25.3 36.7 Customer advances 7.2 8.9 Income and other taxes 15.9 10.3 Other 34.3 41.9 $ 121.5 $ 140.6 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
Schedule of Amounts Included in Financial Statements Arising From Transactions with GST | Amounts included in our consolidated financial statements arising from transactions with GST include the following: Consolidated Statements of Operations Caption Quarters Ended Nine Months Ended Description 2016 2015 2016 2015 (in millions) Sales to GST Net sales $ 6.8 $ 8.9 $ 20.4 $ 22.3 Purchases from GST Cost of sales $ 4.0 $ 5.2 $ 13.2 $ 15.9 Interest expense to GST Interest expense $ 8.4 $ 8.0 $ 25.0 $ 23.8 Description Consolidated Balance Sheets Caption September 30, December 31, (in millions) Due from GST Accounts receivable, net $ 15.4 $ 16.5 Income tax receivable from GST Deferred income taxes and income tax receivable $ 113.1 $ 100.6 Due from GST Other assets $ 1.4 $ 1.3 Due to GST Accounts payable $ 7.2 $ 8.0 Accrued interest to GST Accrued expenses $ 24.4 $ 31.2 |
Pensions and Postretirement B30
Pensions and Postretirement Benefits (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Schedule of Net Periodic Benefit Cost | The components of net periodic benefit cost for the Company’s U.S. and foreign defined benefit pension and other postretirement plans for the quarters and nine months ended September 30, 2016 and 2015 , are as follows: Quarters Ended September 30, Nine Months Ended September 30, Pension Benefits Other Benefits Pension Benefits Other Benefits 2016 2015 2016 2015 2016 2015 2016 2015 (in millions) Service cost $ 1.0 $ 1.2 $ 0.1 $ 0.1 $ 3.2 $ 4.4 $ 0.3 $ 0.3 Interest cost 3.2 2.6 — 0.1 9.5 8.7 0.2 0.2 Expected return on plan assets (4.3 ) (4.7 ) — — (12.7 ) (14.1 ) — — Amortization of net loss 1.7 1.7 — — 5.1 5.3 — — Deconsolidation of GST (0.2 ) (0.2 ) — — (0.7 ) (0.6 ) — — Net periodic benefit cost $ 1.4 $ 0.6 $ 0.1 $ 0.2 $ 4.4 $ 3.7 $ 0.5 $ 0.5 |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Operating Results and Other Financial Data | Segment operating results and other financial data for the quarters and nine months ended September 30, 2016 and 2015 were as follows: Quarters Ended September 30, Nine Months Ended September 30, 2016 2015 2016 2015 (in millions) Sales Sealing Products $ 175.3 $ 186.3 $ 532.6 $ 520.2 Engineered Products 65.7 72.1 213.5 227.8 Power Systems 52.5 49.1 157.2 137.2 293.5 307.5 903.3 885.2 Intersegment sales (0.8 ) (0.9 ) (2.5 ) (2.7 ) Net sales $ 292.7 $ 306.6 $ 900.8 $ 882.5 Segment Profit Sealing Products $ 23.1 $ 22.5 $ 62.4 $ 61.7 Engineered Products 2.9 1.5 10.4 8.9 Power Systems 7.3 9.2 15.5 16.1 Total segment profit 33.3 33.2 88.3 86.7 Corporate expenses (6.4 ) (6.3 ) (21.9 ) (19.5 ) Asbestos settlement — — (80.0 ) — Goodwill and other intangible asset impairment — — — (47.0 ) Interest expense, net (14.0 ) (12.8 ) (41.0 ) (38.6 ) Other expense, net (2.9 ) (1.9 ) (9.8 ) (8.4 ) Income (loss) before income taxes $ 10.0 $ 12.2 $ (64.4 ) $ (26.8 ) |
Schedule of Total Assets Segment | Segment assets are as follows: September 30, December 31, (in millions) Sealing Products $ 653.6 $ 631.7 Engineered Products 223.5 231.5 Power Systems 172.3 162.2 Corporate 532.1 473.4 $ 1,581.5 $ 1,498.8 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis are summarized as follows: Fair Value Measurements as of September 30, 2016 December 31, 2015 (in millions) Assets Time deposits $ 27.5 $ 24.2 Deferred compensation assets 6.4 5.4 $ 33.9 $ 29.6 Liabilities Deferred compensation liabilities $ 7.5 $ 6.6 |
Schedule of Carrying Value of Financial Instruments | The carrying values of our significant financial instruments reflected in the Consolidated Balance Sheets approximated their respective fair values except for the following instruments: September 30, 2016 December 31, 2015 Carrying Value Fair Value Carrying Value Fair Value (in millions) Long-term debt $ 462.6 $ 478.5 $ 356.3 $ 360.3 Notes payable to GST $ 295.9 $ 299.1 $ 283.2 $ 281.7 |
Accumulated Other Comprehensi33
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Summary of Changes in Accumulated Other Comprehensive Loss by Component | Changes in accumulated other comprehensive loss by component (after tax) for the three months ended September 30, 2016 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (9.0 ) $ (47.1 ) $ (56.1 ) Other comprehensive loss before reclassifications (0.4 ) — (0.4 ) Amounts reclassified from accumulated other comprehensive loss — 1.0 1.0 Net current-period other comprehensive income (loss) (0.4 ) 1.0 0.6 Ending balance $ (9.4 ) $ (46.1 ) $ (55.5 ) Changes in accumulated other comprehensive loss by component (after tax) for the three months ended September 30, 2015 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ 6.6 $ (48.8 ) $ (42.2 ) Other comprehensive loss before reclassifications (4.9 ) — (4.9 ) Amounts reclassified from accumulated other comprehensive loss — 1.0 1.0 Net current-period other comprehensive income (loss) (4.9 ) 1.0 (3.9 ) Ending balance $ 1.7 $ (47.8 ) $ (46.1 ) Changes in accumulated other comprehensive loss by component (after tax) for the nine months ended September 30, 2016 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (4.9 ) $ (49.2 ) $ (54.1 ) Other comprehensive loss before reclassifications (4.3 ) — (4.3 ) Amounts reclassified from accumulated other comprehensive loss (0.2 ) 3.1 2.9 Net current-period other comprehensive income (loss) (4.5 ) 3.1 (1.4 ) Ending balance $ (9.4 ) $ (46.1 ) $ (55.5 ) Changes in accumulated other comprehensive loss by component (after tax) for the nine months ended September 30, 2015 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ 17.0 $ (51.1 ) $ (34.1 ) Other comprehensive loss before reclassifications (15.3 ) — (15.3 ) Amounts reclassified from accumulated other comprehensive loss — 3.3 3.3 Net current-period other comprehensive income (loss) (15.3 ) 3.3 (12.0 ) Ending balance $ 1.7 $ (47.8 ) $ (46.1 ) |
Summary of Reclassifications Out of Accumulated Other Comprehensive Loss | Reclassifications out of accumulated other comprehensive loss for the quarters and nine months ended September 30, 2016 and 2015 are as follows: Details about Accumulated Other Comprehensive Income Components Amount Reclassified from Accumulated Other Affected Statement of Operations Caption (in millions) Quarters Ended Nine Months Ended September 30, 2016 2015 2016 2015 Amortization of pension and other postretirement plans: Actuarial losses $ 1.7 $ 1.7 $ 5.1 $ 5.3 (1) Tax benefit (0.7 ) (0.7 ) (2.0 ) (2.0 ) Income tax expense Net of tax $ 1.0 $ 1.0 $ 3.1 $ 3.3 Release of unrealized currency translation adjustment upon sale of investment in foreign entity, net of tax $ — $ — $ (0.2 ) $ — Other non-operating expense (1) These accumulated other comprehensive income components are included in the computation of net periodic pension cost. (See Note 11, “Pensions and Postretirement Benefits” for additional details). |
Garlock Sealing Technologies 34
Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd. (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Reorganizations [Abstract] | |
Schedule of Condensed Combined Statements of Operations | Condensed combined financial information for GST is set forth below, presented on a historical cost basis. GST (Debtor-in-Possession) Condensed Combined Statements of Operations (Unaudited) (in millions) Quarters Ended September 30, Nine Months Ended 2016 2015 2016 2015 Net sales $ 49.2 $ 54.0 $ 150.9 $ 165.2 Cost of sales 31.3 33.8 95.3 102.2 Gross profit 17.9 20.2 55.6 63.0 Operating expenses: Selling, general and administrative 10.0 10.6 31.3 33.0 Asbestos-related 0.1 0.3 50.1 0.4 Other 0.1 0.4 0.4 0.5 Total operating expenses 10.2 11.3 81.8 33.9 Operating income (loss) 7.7 8.9 (26.2 ) 29.1 Interest income, net 8.4 7.8 25.3 23.8 Income (loss) before reorganization expenses and income taxes 16.1 16.7 (0.9 ) 52.9 Reorganization expenses (6.8 ) (5.0 ) (14.8 ) (16.7 ) Income (loss) before income taxes 9.3 11.7 (15.7 ) 36.2 Income tax benefit (expense) (3.7 ) (5.1 ) 5.9 (12.6 ) Net income (loss) $ 5.6 $ 6.6 $ (9.8 ) $ 23.6 Comprehensive income (loss) $ 5.0 $ 0.6 $ (9.0 ) $ 13.6 |
Schedule of Condensed Combined Statements of Cash Flows | GST (Debtor-in-Possession) Condensed Combined Statements of Cash Flows (Unaudited) Nine Months Ended September 30, 2016 and 2015 (in millions) 2016 2015 Net cash provided by operating activities $ 32.9 $ 44.5 Investing activities Purchases of property, plant and equipment (5.1 ) (3.6 ) Net payments on loans to affiliates (5.2 ) (3.6 ) Net purchase of held-to-maturity securities (50.5 ) (29.6 ) Other (0.2 ) — Net cash used in investing activities (61.0 ) (36.8 ) Effect of exchange rate changes on cash and cash equivalents 1.4 (3.3 ) Net increase (decrease) in cash and cash equivalents (26.7 ) 4.4 Cash and cash equivalents at beginning of period 71.9 66.0 Cash and cash equivalents at end of period $ 45.2 $ 70.4 |
Schedule of Condensed Combined Balance Sheets | GST (Debtor-in-Possession) Condensed Combined Balance Sheets (Unaudited) (in millions) September 30, December 31, Assets : Notes receivable from affiliate - current $ 295.9 $ 12.2 Other current assets 410.5 393.9 Asbestos insurance receivable 49.0 62.0 Deferred income taxes 126.8 105.6 Notes receivable from affiliate — 271.0 Other assets 67.7 67.8 Total assets $ 949.9 $ 912.5 Liabilities and Shareholder’s Equity : Current liabilities $ 33.9 $ 40.5 Other liabilities 117.6 114.4 Liabilities subject to compromise (A) 388.6 339.1 Total liabilities 540.1 494.0 Shareholder’s equity 409.8 418.5 Total liabilities and shareholder’s equity $ 949.9 $ 912.5 (A) Liabilities subject to compromise include pre-petition unsecured claims which may be resolved at amounts different from those recorded in the condensed combined balance sheets. Liabilities subject to compromise consist principally of asbestos-related claims. Per the terms of the comprehensive settlement agreement with the appointed committee representing current asbestos claimants and the court-appointed representative of future claimants in the GST asbestos claims resolution process pending before the Bankruptcy Court, GST has accrued $387.0 million as of September 30, 2016 for asbestos related claims. The accrual consists of of (a) $ 370 million to be contributed to the trust for present and future asbestos claims against GST plus litigation and administrative expenses, and (b) an estimate of $ 17.0 million for the resolution of all current and future Canadian asbestos claims alleging disease resulting in whole or in part from exposure to GST asbestos-containing products. See Note 17, “Commitments and Contingencies - Asbestos - Liability Estimate." |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule Of Changes In Carrying Amount Of Product Warranty Liability | Changes in the carrying amount of the product warranty liability for the nine months ended September 30, 2016 and 2015 are as follows: 2016 2015 (in millions) Balance at beginning of year $ 4.8 $ 3.5 Net charges to expense 3.3 2.0 Settlements made (3.4 ) (1.9 ) Balance at end of period $ 4.7 $ 3.6 |
Supplemental Guarantor Financ36
Supplemental Guarantor Financial Information (Tables) | 9 Months Ended |
Sep. 30, 2016 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Income Statement | ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended September 30, 2016 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 207.1 $ 105.1 $ (19.5 ) $ 292.7 Cost of sales — 144.8 68.8 (19.5 ) 194.1 Gross profit — 62.3 36.3 — 98.6 Operating expenses: Selling, general and administrative 6.3 37.9 26.7 — 70.9 Other 0.4 0.1 1.9 — 2.4 Total operating expenses 6.7 38.0 28.6 — 73.3 Operating income (loss) (6.7 ) 24.3 7.7 — 25.3 Interest expense, net (4.7 ) (9.3 ) — — (14.0 ) Other expense — (1.2 ) (0.1 ) — (1.3 ) Income (loss) before income taxes (11.4 ) 13.8 7.6 — 10.0 Income tax benefit (expense) 8.4 (8.2 ) (4.2 ) — (4.0 ) Income (loss) before equity in earnings of subsidiaries (3.0 ) 5.6 3.4 — 6.0 Equity in earnings of subsidiaries, net of tax 9.0 3.4 — (12.4 ) — Net income $ 6.0 $ 9.0 $ 3.4 $ (12.4 ) $ 6.0 Comprehensive income $ 6.6 $ 9.5 $ 3.0 $ (12.5 ) $ 6.6 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended September 30, 2015 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 212.9 $ 112.9 $ (19.2 ) $ 306.6 Cost of sales — 147.2 77.2 (19.2 ) 205.2 Gross profit — 65.7 35.7 — 101.4 Operating expenses: Selling, general and administrative 6.5 40.7 27.6 — 74.8 Other 0.7 0.6 0.4 — 1.7 Total operating expenses 7.2 41.3 28.0 — 76.5 Operating income (loss) (7.2 ) 24.4 7.7 — 24.9 Interest expense, net (4.7 ) (8.0 ) (0.1 ) — (12.8 ) Other income — 0.1 — — 0.1 Income (loss) before income taxes (11.9 ) 16.5 7.6 — 12.2 Income tax benefit (expense) 2.3 (1.0 ) (2.1 ) — (0.8 ) Income (loss) before equity in earnings of subsidiaries (9.6 ) 15.5 5.5 — 11.4 Equity in earnings of subsidiaries, net of tax 21.0 5.5 — (26.5 ) — Net income $ 11.4 $ 21.0 $ 5.5 $ (26.5 ) $ 11.4 Comprehensive income $ 7.5 $ 17.1 $ 0.5 $ (17.6 ) $ 7.5 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2016 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 630.2 $ 333.9 $ (63.3 ) $ 900.8 Cost of sales — 442.0 218.0 (63.3 ) 596.7 Gross profit — 188.2 115.9 — 304.1 Operating expenses: Selling, general and administrative 20.8 124.2 86.7 — 231.7 Asbestos settlement — 80.0 — — 80.0 Other 1.7 2.9 5.8 — 10.4 Total operating expenses 22.5 207.1 92.5 — 322.1 Operating income (loss) (22.5 ) (18.9 ) 23.4 — (18.0 ) Interest expense, net (13.9 ) (26.9 ) (0.2 ) — (41.0 ) Other expense — (5.1 ) (0.3 ) — (5.4 ) Income (loss) before income taxes (36.4 ) (50.9 ) 22.9 — (64.4 ) Income tax benefit (expense) 13.1 28.3 (14.2 ) — 27.2 Income (loss) before equity in earnings of subsidiaries (23.3 ) (22.6 ) 8.7 — (37.2 ) Equity in earnings of subsidiaries, net of tax (13.9 ) 8.7 — 5.2 — Net income (loss) $ (37.2 ) $ (13.9 ) $ 8.7 $ 5.2 $ (37.2 ) Comprehensive income (loss) $ (38.6 ) $ (15.4 ) $ 4.2 $ 11.2 $ (38.6 ) ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2015 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 609.7 $ 312.6 $ (39.8 ) $ 882.5 Cost of sales — 426.1 203.7 (39.8 ) 590.0 Gross profit — 183.6 108.9 — 292.5 Operating expenses: Selling, general and administrative 18.7 118.0 89.5 — 226.2 Goodwill and other intangible asset impairment — 5.6 41.4 — 47.0 Other 0.9 0.6 1.8 — 3.3 Total operating expenses 19.6 124.2 132.7 — 276.5 Operating income (loss) (19.6 ) 59.4 (23.8 ) — 16.0 Interest expense, net (8.5 ) (29.9 ) (0.2 ) — (38.6 ) Other expense (2.8 ) (1.4 ) — — (4.2 ) Income (loss) before income taxes (30.9 ) 28.1 (24.0 ) — (26.8 ) Income tax benefit (expense) 8.0 (5.1 ) (3.6 ) — (0.7 ) Income (loss) before equity in earnings of subsidiaries (22.9 ) 23.0 (27.6 ) — (27.5 ) Equity in earnings of subsidiaries, net of tax (4.6 ) (27.6 ) — 32.2 — Net loss $ (27.5 ) $ (4.6 ) $ (27.6 ) $ 32.2 $ (27.5 ) Comprehensive loss $ (39.5 ) $ (16.6 ) $ (42.7 ) $ 59.3 $ (39.5 ) |
Condensed Cash Flow Statement | ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2016 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ (51.6 ) $ 33.9 $ 25.6 $ — $ 7.9 INVESTING ACTIVITIES Purchases of property, plant and equipment — (19.5 ) (5.1 ) — (24.6 ) Payments for capitalized internal-use software — (2.8 ) (0.3 ) — (3.1 ) Acquisitions, net of cash acquired — (25.5 ) (3.0 ) — (28.5 ) Other — 2.9 0.8 — 3.7 Net cash used in investing activities — (44.9 ) (7.6 ) — (52.5 ) FINANCING ACTIVITIES Net payments on loans between subsidiaries 94.5 (95.2 ) 0.7 — — Proceeds from debt — 297.2 6.1 — 303.3 Repayments of debt — (191.7 ) (1.0 ) — (192.7 ) Repurchase of common stock (26.2 ) — — — (26.2 ) Dividends paid (13.6 ) — — — (13.6 ) Other (3.1 ) — — — (3.1 ) Net cash provided by financing activities 51.6 10.3 5.8 — 67.7 Effect of exchange rate changes on cash and cash equivalents — — (11.7 ) — (11.7 ) Net increase (decrease) in cash and cash equivalents — (0.7 ) 12.1 — 11.4 Cash and cash equivalents at beginning of period — 0.7 102.7 — 103.4 Cash and cash equivalents at end of period $ — $ — $ 114.8 $ — $ 114.8 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2015 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ (36.6 ) $ 45.7 $ 22.9 $ — $ 32.0 INVESTING ACTIVITIES Purchases of property, plant and equipment (0.1 ) (17.8 ) (5.5 ) — (23.4 ) Payments for capitalized internal-use software — (2.5 ) (1.1 ) — (3.6 ) Acquisitions, net of cash acquired — (42.4 ) (3.1 ) — (45.5 ) Other — 0.1 0.2 — 0.3 Net cash used in investing activities (0.1 ) (62.6 ) (9.5 ) — (72.2 ) FINANCING ACTIVITIES Net payments on loans between subsidiaries 177.5 (175.9 ) (1.6 ) — — Proceeds from debt — 177.7 3.6 — 181.3 Repayments of debt (23.3 ) (99.8 ) — — (123.1 ) Repurchase of common stock (80.0 ) — — — (80.0 ) Dividends paid (13.8 ) — — — (13.8 ) Repurchase of convertible debentures conversion option (21.6 ) — — — (21.6 ) Other (2.1 ) — — — (2.1 ) Net cash provided by (used in) financing activities 36.7 (98.0 ) 2.0 — (59.3 ) Effect of exchange rate changes on cash and cash equivalents — — (2.7 ) — (2.7 ) Net increase (decrease) in cash and cash equivalents — (114.9 ) 12.7 — (102.2 ) Cash and cash equivalents at beginning of period — 114.9 79.3 — 194.2 Cash and cash equivalents at end of period $ — $ — $ 92.0 $ — $ 92.0 |
Condensed Balance Sheet | ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING BALANCE SHEETS (UNAUDITED) As of September 30, 2016 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets Cash and cash equivalents $ — $ — $ 114.8 $ — $ 114.8 Accounts receivable, net — 162.6 60.0 — 222.6 Intercompany receivables — 8.2 5.9 (14.1 ) — Inventories — 124.9 54.0 — 178.9 Prepaid expenses and other current assets 26.9 8.5 13.8 (12.6 ) 36.6 Total current assets 26.9 304.2 248.5 (26.7 ) 552.9 Property, plant and equipment, net 0.1 144.4 71.7 — 216.2 Goodwill — 175.4 28.1 — 203.5 Other intangible assets — 161.0 23.8 — 184.8 Investment in GST — 236.9 — — 236.9 Intercompany receivables 7.8 49.9 1.0 (58.7 ) — Investment in subsidiaries 689.4 246.2 — (935.6 ) — Other assets 16.4 150.7 20.1 — 187.2 Total assets $ 740.6 $ 1,468.7 $ 393.2 $ (1,021.0 ) $ 1,581.5 LIABILITIES AND EQUITY Current liabilities Short-term borrowings from GST $ — $ — $ 27.8 $ — $ 27.8 Notes payable to GST — 295.9 — — 295.9 Current maturities of long-term debt — 0.1 — — 0.1 Accounts payable 1.0 52.2 35.9 — 89.1 Intercompany payables — 5.9 8.2 (14.1 ) — Accrued expenses 7.6 83.4 43.1 (12.6 ) 121.5 Total current liabilities 8.6 437.5 115.0 (26.7 ) 534.4 Long-term debt 293.9 168.6 — — 462.5 Intercompany payables 40.7 8.1 9.9 (58.7 ) — Other liabilities 13.3 165.1 22.1 — 200.5 Total liabilities 356.5 779.3 147.0 (85.4 ) 1,197.4 Shareholders’ equity 384.1 689.4 246.2 (935.6 ) 384.1 Total liabilities and equity $ 740.6 $ 1,468.7 $ 393.2 $ (1,021.0 ) $ 1,581.5 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING BALANCE SHEETS (UNAUDITED) As of December 31, 2015 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets Cash and cash equivalents $ — $ 0.7 $ 102.7 $ — $ 103.4 Accounts receivable, net 0.1 153.2 59.2 — 212.5 Intercompany receivables — 8.1 11.7 (19.8 ) — Inventories — 126.4 52.0 — 178.4 Prepaid expenses and other current assets 13.6 11.2 9.9 (11.1 ) 23.6 Total current assets 13.7 299.6 235.5 (30.9 ) 517.9 Property, plant and equipment, net 0.1 135.1 76.3 — 211.5 Goodwill — 167.6 28.3 — 195.9 Other intangible assets — 162.6 27.8 — 190.4 Investment in GST — 236.9 — — 236.9 Intercompany receivables 65.8 12.7 1.4 (79.9 ) — Investment in subsidiaries 693.0 241.8 — (934.8 ) — Other assets 14.8 122.0 19.3 (9.9 ) 146.2 Total assets $ 787.4 $ 1,378.3 $ 388.6 $ (1,055.5 ) $ 1,498.8 LIABILITIES AND EQUITY Current liabilities Short-term borrowings from GST $ — $ — $ 24.3 $ — $ 24.3 Notes payable to GST — 12.2 — — 12.2 Current maturities of long-term debt — 0.1 — — 0.1 Accounts payable 2.3 59.3 39.9 — 101.5 Intercompany payables — 11.7 8.1 (19.8 ) — Accrued expenses 17.7 89.6 44.4 (11.1 ) 140.6 Total current liabilities 20.0 172.9 116.7 (30.9 ) 278.7 Long-term debt 293.3 62.9 — — 356.2 Notes payable to GST — 271.0 — — 271.0 Intercompany payables 4.2 66.1 9.6 (79.9 ) — Other liabilities 10.1 112.4 20.5 (9.9 ) 133.1 Total liabilities 327.6 685.3 146.8 (120.7 ) 1,039.0 Shareholders’ equity 459.8 693.0 241.8 (934.8 ) 459.8 Total liabilities and equity $ 787.4 $ 1,378.3 $ 388.6 $ (1,055.5 ) $ 1,498.8 |
Overview, Significant Accountin
Overview, Significant Accounting Policies and Recently Issued Accounting Pronouncements - Additional Information (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Statement of Cash Flows [Abstract] | |
Other Long-term Debt | $ 4.7 |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Millions | Apr. 29, 2016 | Sep. 30, 2016 | Sep. 30, 2015 |
Business Combinations [Abstract] | |||
Annual revenues | $ 17 | ||
Payments to Acquire Businesses, Net of Cash Acquired | $ 28.5 | $ 45.5 |
Income Taxes Income Taxes - Add
Income Taxes Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2016 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | ||||||
Income Tax Expense (Benefit) | $ 4 | $ 0.8 | $ (27.2) | $ 0.7 | ||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | $ 10 | $ 12.2 | $ (64.4) | $ (26.8) | ||
Effective Income Tax Rate Reconciliation, Percent | 39.60% | 6.30% | 42.30% | (2.40%) | ||
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | $ 3.2 | |||||
Goodwill Impairment Loss Tax Benefit | $ 0.8 | |||||
Goodwill and Intangible Asset Impairment | $ 0 | $ 0 | $ 0 | $ 47 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Computation of Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) | $ 6 | $ 11.4 | $ (37.2) | $ (27.5) |
Weighted Average Number of Shares Outstanding, Basic (in shares) | 21.5 | 22 | 21.7 | 22.7 |
Share-based awards (in shares) | 0.2 | 0.1 | 0 | 0 |
Weighted-average shares - diluted (in shares) | 21.7 | 22.1 | 21.7 | 22.7 |
Basic (in usd per share) | $ 0.28 | $ 0.52 | $ (1.71) | $ (1.21) |
Diluted (in usd per share) | $ 0.28 | $ 0.51 | $ (1.71) | $ (1.21) |
Anti-dilutive shares excluded from computation of earnings per share | 0.2 | 1 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Finished products | $ 106.5 | $ 110.2 |
Work in process | 25 | 25.6 |
Raw materials and supplies | 52.7 | 49 |
Inventory Gross | 184.2 | 184.8 |
Reserve to reduce certain inventories to LIFO basis | (11.3) | (11.3) |
Manufacturing inventories | 172.9 | 173.5 |
Incurred costs relating to long-term contracts | 13.4 | 10.9 |
Progress payments related to long-term contracts | (7.4) | (6) |
Net balance associated with complete-contract inventories | 6 | 4.9 |
Total inventories | $ 178.9 | $ 178.4 |
Long-Term Contracts Costs and B
Long-Term Contracts Costs and Billings on Uncompleted Contracts - Schedule of Information Regarding Contracts Accounted for Under Percentage-of-Completion Method (Detail) - Other Liabilities [Member] - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Cumulative revenues recognized on uncompleted POC contracts | $ 328.3 | $ 215 |
Cumulative billings on uncompleted POC contracts | 293.9 | 198.2 |
Revenues and billing on uncompleted contracts | $ 34.4 | $ 16.8 |
Long-Term Contracts Costs and43
Long-Term Contracts Costs and Billings on Uncompleted Contracts - Schedule of Uncompleted Contracts Reflected in Consolidated Balance Sheets (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Incurred costs relating to long-term contracts | $ 13.4 | $ 10.9 |
Progress payments related to long-term contracts | (7.4) | (6) |
Retainage Deposit | 1.3 | 1.8 |
Accounts Receivable [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net (POC revenue recognized excess of billings) | 38.8 | 23.5 |
Accrued Liabilities [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Acrrued expenses (billings in excess of POC revenue recognized) | (4.4) | (6.7) |
Other Liabilities [Member] | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Revenues Billings On Uncompleted Contracts | 34.4 | 16.8 |
Incurred costs relating to long-term contracts | 0 | 0.1 |
Progress payments related to long-term contracts | (0.9) | (1) |
Billings in Excess of Cost | $ (0.9) | $ (0.9) |
Goodwill and Other Intangible44
Goodwill and Other Intangible Assets - Schedule of Changes in Net Carrying Value of Goodwill by Reportable Segment (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2016USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | $ 195.9 |
Change due to acquisitions | 7.8 |
Change due to foreign currency translation | (0.2) |
Goodwill, ending balance | 203.5 |
Sealing Products [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 179.7 |
Change due to acquisitions | 7.8 |
Change due to foreign currency translation | (0.2) |
Goodwill, ending balance | 187.3 |
Engineered Products [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 9.1 |
Change due to acquisitions | 0 |
Change due to foreign currency translation | 0 |
Goodwill, ending balance | 9.1 |
Power Systems [Member] | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 7.1 |
Goodwill, ending balance | $ 7.1 |
Goodwill and Other Intangible45
Goodwill and Other Intangible Assets - Schedule of Identifiable Intangible Assets (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets [Line Items] | ||
Amortized, Gross Carrying Amount | $ 344.4 | $ 334.9 |
Amortized, Accumulated Amortization | 193.7 | 179.2 |
Intangible Assets, Gross (Excluding Goodwill) | 378.5 | 369.6 |
Trademarks [Member] | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-Lived, Gross Carrying Amount | 34.1 | 34.7 |
Customer relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized, Gross Carrying Amount | 221.7 | 212.5 |
Amortized, Accumulated Amortization | 122.8 | 112 |
Existing technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized, Gross Carrying Amount | 62.6 | 63 |
Amortized, Accumulated Amortization | 29 | 26.9 |
Trademarks [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized, Gross Carrying Amount | 36 | 35.3 |
Amortized, Accumulated Amortization | 19.5 | 18.4 |
Other [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortized, Gross Carrying Amount | 24.1 | 24.1 |
Amortized, Accumulated Amortization | $ 22.4 | $ 21.9 |
Goodwill and Other Intangible46
Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | |||||
Goodwill | $ 203.5 | $ 203.5 | $ 195.9 | ||
Amortization expense | 5.3 | $ 5.4 | 15.8 | $ 16.4 | |
Sealing Products [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Goodwill | 187.3 | 187.3 | 179.7 | ||
Goodwill, Impaired, Accumulated Impairment Loss | 27.8 | 27.8 | 27.8 | ||
Engine Products And Services [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Goodwill | 9.1 | 9.1 | 9.1 | ||
Goodwill, Impaired, Accumulated Impairment Loss | $ 154.8 | $ 154.8 | $ 154.8 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Salaries, wages and employee benefits | $ 38.8 | $ 42.8 |
Interest | 25.3 | 36.7 |
Customer Advances | 7.2 | 8.9 |
Income and other taxes | 15.9 | 10.3 |
Other | 34.3 | 41.9 |
Accrued expenses | $ 121.5 | $ 140.6 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Jan. 01, 2010 | |
Related Party Transaction [Line Items] | ||||
Short-term borrowings | $ 27.8 | $ 24.3 | ||
Amended and Restated Promissory Note | 295.9 | 283.2 | ||
Interest | 39.7 | $ 35.8 | ||
Garlock Sealing Technologies [Member] | ||||
Related Party Transaction [Line Items] | ||||
Short-term borrowings | 27.8 | $ 24.3 | ||
Interest | 18.4 | 17.6 | ||
Paid-in-Kind Interest | $ 12.7 | $ 12.2 | ||
Majority-Owned Subsidiary, Unconsolidated [Member] | ||||
Related Party Transaction [Line Items] | ||||
Amended and Restated Promissory Note | $ 73.4 | |||
Subsidiary of Common Parent [Member] | ||||
Related Party Transaction [Line Items] | ||||
Amended and Restated Promissory Note | $ 153.8 | |||
Intercompany Notes [Member] | ||||
Related Party Transaction [Line Items] | ||||
Interest rate, stated percentage | 11.00% | |||
Intercompany notes, interest payable in cash, percentage | 6.50% | |||
Intercompany notes, interest paid in kind added to principal amount, percentage | 4.50% |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Amounts Included in Financial Statements Arising From Transactions with GST (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||||
Due from GST | $ 0 | $ 0 | $ 0 | ||
Accrued interest to GST | 25.3 | 25.3 | 36.7 | ||
Accounts Receivable [Member] | |||||
Related Party Transaction [Line Items] | |||||
Due from GST | 15.4 | 15.4 | 16.5 | ||
Deferred Income Taxes [Member] | |||||
Related Party Transaction [Line Items] | |||||
Income tax receivable from GST | 113.1 | 113.1 | 100.6 | ||
Other Assets [Member] | |||||
Related Party Transaction [Line Items] | |||||
Due from GST | 1.4 | 1.4 | 1.3 | ||
Accounts Payable [Member] | |||||
Related Party Transaction [Line Items] | |||||
Due to GST | 7.2 | 7.2 | 8 | ||
Accrued Expenses [Member] | |||||
Related Party Transaction [Line Items] | |||||
Accrued interest to GST | 24.4 | 24.4 | $ 31.2 | ||
Net Sales [Member] | |||||
Related Party Transaction [Line Items] | |||||
Sales to GST | 6.8 | $ 8.9 | 20.4 | $ 22.3 | |
Cost of Sales [Member] | |||||
Related Party Transaction [Line Items] | |||||
Purchases from GST | 4 | 5.2 | 13.2 | 15.9 | |
Interest Expense [Member] | |||||
Related Party Transaction [Line Items] | |||||
Interest expense to GST | $ 8.4 | $ 8 | $ 25 | $ 23.8 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2014 | |
Revolving Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Credit facility maximum availability | $ 300,000,000 | |
Credit facility borrowing capacity | 121,600,000 | |
Letter of credit outstanding | 10,400,000 | |
Long-term Line of Credit | $ 168,000,000 | |
London Interbank Offered Rate (LIBOR) [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt Instrument, Description of Variable Rate Basis | 2.00% | |
Base Rate [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt Instrument, Description of Variable Rate Basis | 1.00% | |
Senior Notes [Member] | ||
Line of Credit Facility [Line Items] | ||
Senior Notes | $ 300,000,000 | |
Interest rate of debentures | 5.875% | |
Debt discount amount | $ 2,400,000 | |
Effective interest rate of debt instrument | 6.00% | |
Debt Instrument, Redemption Price, Percentage | 100.00% |
Pensions and Postretirement B51
Pensions and Postretirement Benefits - Schedule of Net Periodic Benefit Cost (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ||||
Defined Benefit Plans, Estimated Future Employer Contributions in Current Fiscal Year | $ 14.8 | |||
Pension Benefits [Member] | ||||
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ||||
Service cost | $ 1 | $ 1.2 | 3.2 | $ 4.4 |
Interest cost | 3.2 | 2.6 | 9.5 | 8.7 |
Expected return on plan assets | (4.3) | (4.7) | (12.7) | (14.1) |
Amortization of net loss | 1.7 | 1.7 | 5.1 | 5.3 |
Deconsolidation of GST | (0.2) | (0.2) | (0.7) | (0.6) |
Net periodic benefit cost | 1.4 | 0.6 | 4.4 | 3.7 |
Other Benefits [Member] | ||||
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ||||
Service cost | 0.1 | 0.1 | 0.3 | 0.3 |
Interest cost | 0 | 0.1 | 0.2 | 0.2 |
Net periodic benefit cost | $ 0.1 | $ 0.2 | $ 0.5 | $ 0.5 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) $ / shares in Units, shares in Millions | Nov. 02, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Oct. 31, 2015 |
Subsequent Event [Line Items] | ||||||
Common Stock, Dividends, Per Share, Declared | $ 0.21 | $ 0.20 | $ 0.63 | $ 0.60 | ||
RepurchaseAveragePricePerShare | $ 25,800,000 | |||||
Payments for Repurchase of Common Stock | 26,200,000 | $ 80,000,000 | ||||
Stock Repurchase Program, Authorized Amount | $ 50,000,000 | |||||
Payments of Ordinary Dividends, Common Stock | $ 13,600,000 | $ 13,800,000 | ||||
Stock Repurchased Shares | 0.5 | |||||
Subsequent Event [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Common Stock, Dividends, Per Share, Declared | $ 0.21 | |||||
RepurchaseAveragePricePerShare | $ 2,400,000 |
Business Segment Information -
Business Segment Information - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2016 | |
Segment Reporting [Abstract] | |
Number Of Reportable Segments | 3 |
Business Segment Information 54
Business Segment Information - Schedule of Segment Operating Results and Other Financial Data (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Segment Reporting Information [Line Items] | ||||
Total product segment sales | $ 292.7 | $ 306.6 | $ 900.8 | $ 882.5 |
Segment profit | 25.3 | 24.9 | (18) | 16 |
Asbestos Related Expenses | 0 | 0 | (80) | 0 |
Goodwill and Intangible Asset Impairment | 0 | 0 | 0 | (47) |
Other expense | (1.3) | 0.1 | (5.4) | (4.2) |
Income (loss) before income taxes | 10 | 12.2 | (64.4) | (26.8) |
Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total product segment sales | 293.5 | 307.5 | 903.3 | 885.2 |
Segment profit | 33.3 | 33.2 | 88.3 | 86.7 |
Intersegment Sales [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total product segment sales | 0.8 | 0.9 | 2.5 | 2.7 |
Corporate expense [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Segment profit | (6.4) | (6.3) | (21.9) | (19.5) |
Asbestos Related Expenses | (80) | |||
Goodwill and Intangible Asset Impairment | 0 | (47) | ||
Interest expense, net | (14) | (12.8) | (41) | (38.6) |
Other expense | (2.9) | (1.9) | (9.8) | (8.4) |
Income (loss) before income taxes | 10 | 12.2 | (64.4) | (26.8) |
Sealing Products [Member] | Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total product segment sales | 175.3 | 186.3 | 532.6 | 520.2 |
Segment profit | 23.1 | 22.5 | 62.4 | 61.7 |
Engineered Products [Member] | Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total product segment sales | 65.7 | 72.1 | 213.5 | 227.8 |
Segment profit | 2.9 | 1.5 | 10.4 | 8.9 |
Power Systems [Member] | Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Total product segment sales | 52.5 | 49.1 | 157.2 | 137.2 |
Segment profit | $ 7.3 | $ 9.2 | $ 15.5 | $ 16.1 |
Business Segment Information 55
Business Segment Information - Schedule of Assets and Long Lived Assets Segment (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Schedule Of Assets By Segment [Line Items] | ||
Assets | $ 1,581.5 | $ 1,498.8 |
Operating Segments [Member] | Sealing Products [Member] | ||
Schedule Of Assets By Segment [Line Items] | ||
Assets | 653.6 | 631.7 |
Operating Segments [Member] | Engineered Products [Member] | ||
Schedule Of Assets By Segment [Line Items] | ||
Assets | 223.5 | 231.5 |
Operating Segments [Member] | Power Systems [Member] | ||
Schedule Of Assets By Segment [Line Items] | ||
Assets | 172.3 | 162.2 |
Corporate expense [Member] | ||
Schedule Of Assets By Segment [Line Items] | ||
Assets | $ 532.1 | $ 473.4 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - Level 1 [Member] - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Fair Value, Option, Qualitative Disclosures Related to Election [Line Items] | ||
Assets measured at fair value | $ 33.9 | $ 29.6 |
Bank Time Deposits [Member] | ||
Fair Value, Option, Qualitative Disclosures Related to Election [Line Items] | ||
Cash equivalents | 27.5 | 24.2 |
Deferred Compensation [Member] | ||
Fair Value, Option, Qualitative Disclosures Related to Election [Line Items] | ||
Assets measured at fair value | 6.4 | 5.4 |
Liabilities measured at fair value | $ 7.5 | $ 6.6 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Carrying Value of Financial Instruments (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Compensation and Retirement Disclosure [Abstract] | ||
Long-term debt, Carrying Value | $ 462.6 | $ 356.3 |
Notes payable to GST, Carrying Value | 295.9 | 283.2 |
Long-term Debt, Fair Value | 478.5 | 360.3 |
Notes payable to GST, Fair Value | $ 299.1 | $ 281.7 |
Accumulated Other Comprehensi58
Accumulated Other Comprehensive Loss - Summary of Changes in Accumulated Other Comprehensive Loss by Component (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Beginning balance | $ (56.1) | $ (42.2) | $ (54.1) | $ (34.1) |
Other comprehensive income before reclassifications | (0.4) | (4.9) | (4.3) | (15.3) |
Amounts reclassified from accumulated other comprehensive income loss | 1 | 1 | 2.9 | 3.3 |
Net current-period other comprehensive income(loss) | 0.6 | (3.9) | (1.4) | (12) |
Ending balance | (55.5) | (46.1) | (55.5) | (46.1) |
Unrealized Translation Adjustments [Member] | ||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Beginning balance | (9) | 6.6 | (4.9) | 17 |
Other comprehensive income before reclassifications | (0.4) | (4.9) | (4.3) | (15.3) |
Amounts reclassified from accumulated other comprehensive income loss | 0 | (0.2) | 0 | |
Net current-period other comprehensive income(loss) | (0.4) | (4.9) | (4.5) | (15.3) |
Ending balance | (9.4) | 1.7 | (9.4) | 1.7 |
Pension and Other Postretirement Plans [Member] | ||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||
Beginning balance | (47.1) | (48.8) | (49.2) | (51.1) |
Amounts reclassified from accumulated other comprehensive income loss | 1 | 1 | 3.1 | 3.3 |
Net current-period other comprehensive income(loss) | 1 | 1 | 3.1 | 3.3 |
Ending balance | $ (46.1) | $ (47.8) | $ (46.1) | $ (47.8) |
Accumulated Other Comprehensi59
Accumulated Other Comprehensive Loss - Summary of Reclassifications Out of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Pension Plans Postretirement And Other Employee Benefits [Line Items] | ||||
Tax benefit | $ 4 | $ 0.8 | $ (27.2) | $ 0.7 |
Net loss | 6 | 11.4 | (37.2) | (27.5) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Accumulated Defined Benefit Plans Adjustment [Member] | ||||
Pension Plans Postretirement And Other Employee Benefits [Line Items] | ||||
Actuarial losses | 1.7 | 1.7 | 5.1 | 5.3 |
Tax benefit | (0.7) | (0.7) | (2) | (2) |
Net loss | 1 | $ 1 | 3.1 | $ 3.3 |
Translation Adjustment Functional to Reporting Currency, Net of Tax | $ 0 | $ (0.2) |
Garlock Sealing Technologies 60
Garlock Sealing Technologies LLC and Garrison Litigation Management Group, LTD - Additional Information (Detail) - USD ($) | Jan. 14, 2015 | May 29, 2014 | Jan. 10, 2014 | Nov. 30, 2011 | Sep. 30, 2016 | Mar. 31, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | Jun. 30, 2014 | Jun. 05, 2010 |
Product Liability Contingency [Line Items] | ||||||||||||
Litigation Settlement, Amount | $ 2,700,000 | |||||||||||
Liabilities Subject to Compromise, Asbestos Obligations, Claims | $ 17,000,000 | $ 17,000,000 | ||||||||||
Asbestos Related Expenses | $ 0 | $ 0 | $ 80,000,000 | $ 0 | ||||||||
Percentage of Claimants Required to Approve Joint Plan | 75.00% | 75.00% | ||||||||||
Sale of Stock, Price Per Share | $ 1 | |||||||||||
Common Stock, Value, Issued | $ 20,000,000 | $ 20,000,000 | ||||||||||
Percentage of Outstanding Voting Equity in GST LLC and GLMG | 50.10% | |||||||||||
Liabilities Subject to Compromise [Abstract] | ||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | $ 110,000,000 | 110,000,000 | $ 30,000,000 | |||||||||
GST, LLC [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Litigation Settlement, Amount | 370,000,000 | |||||||||||
Liability For Asbestos and Environmental Claims, Period for Additional Contributions | 7 years | |||||||||||
Liabilities Subject to Compromise, Asbestos Obligations, Claims | $ 17,000,000 | |||||||||||
Liabilities Subject to Compromise [Abstract] | ||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | 387,000,000 | 387,000,000 | $ 337,500,000 | $ 280,500,000 | ||||||||
Liability for Asbestos and Environmental Claims, Gross | 370,000,000 | 370,000,000 | ||||||||||
Coltec Industries Inc. [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Litigation Settlement, Amount | $ 110,000,000 | |||||||||||
OldCo [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Litigation Settlement, Amount | $ 20,000,000 | |||||||||||
Asbestos Issue [Member] | GST, LLC [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Proposed | $ 200,000,000 | |||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Supplementary Contribution Period | 40 years | |||||||||||
Product Liability Contingency, Loss Exposure Not Accrued, Best Estimate | $ 0 | |||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal [Abstract] [Abstract] | ||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Administrative and Litigation Costs | 220,000,000 | |||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Maximum Aggregate Contingent Supplementary Contributions | 132,000,000 | |||||||||||
Asbestos Issue [Member] | Coltec Industries Inc. [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Asbestos Related Expenses | 30,000,000 | |||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Dissolution Costs, High End Range | 500,000 | |||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal [Abstract] [Abstract] | ||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Administrative and Litigation Costs | 30,000,000 | |||||||||||
Liabilities Subject to Compromise [Abstract] | ||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | 367,500,000 | |||||||||||
Minimum [Member] | Asbestos Issue [Member] | ||||||||||||
Liabilities Subject to Compromise [Abstract] | ||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | $ 472,100,000 | |||||||||||
Minimum [Member] | Asbestos Issue [Member] | GST, LLC [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal | $ 275,000,000 | |||||||||||
Minimum [Member] | Asbestos Issue Mesothelioma [Member] | GST, LLC [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Plan of Reorganization, Loss Contingency, Court Estimate | $ 125,000,000 | |||||||||||
Future Claim Representative [Member] | GST, LLC [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Litigation Settlement, Amount | 77,500,000 | |||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Litigation Fund | $ 30,000,000 | |||||||||||
OldCo [Member] | ||||||||||||
Product Liability Contingency [Line Items] | ||||||||||||
Litigation Settlement, Amount | $ 60,000,000 |
Garlock Sealing Technologies 61
Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd. - Schedule of Condensed Combined Statements of Comprehensive Income (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | |
Other Items Net Interest And Other Financial Income [Line Items] | ||||
Net sales | $ 292.7 | $ 306.6 | $ 900.8 | $ 882.5 |
Cost of sales | 194.1 | 205.2 | 596.7 | 590 |
Gross profit | 98.6 | 101.4 | 304.1 | 292.5 |
Selling, general and administrative | 70.9 | 74.8 | 231.7 | 226.2 |
Other | 2.4 | 1.7 | 10.4 | 3.3 |
Total operating expenses | 73.3 | 76.5 | 322.1 | 276.5 |
Operating income (loss) | 25.3 | 24.9 | (18) | 16 |
Income (loss) before income taxes | 10 | 12.2 | (64.4) | (26.8) |
Income tax benefit (expense) | (4) | (0.8) | 27.2 | (0.7) |
Net income (loss) | 6 | 11.4 | (37.2) | (27.5) |
Comprehensive income (loss) | 6.6 | 7.5 | (38.6) | (39.5) |
Garlock Sealing Technologies [Member] | ||||
Other Items Net Interest And Other Financial Income [Line Items] | ||||
Net sales | 49.2 | 54 | 150.9 | 165.2 |
Cost of sales | 31.3 | 33.8 | 95.3 | 102.2 |
Gross profit | 17.9 | 20.2 | 55.6 | 63 |
Selling, general and administrative | 10 | 10.6 | 31.3 | 33 |
Asbestos- related | 0.1 | 0.3 | 50.1 | 0.4 |
Other | 0.1 | 0.4 | 0.4 | 0.5 |
Total operating expenses | 10.2 | 11.3 | 81.8 | 33.9 |
Operating income (loss) | 7.7 | 8.9 | (26.2) | 29.1 |
Interest income, net | 8.4 | 7.8 | 25.3 | 23.8 |
Income (loss) before reorganization expenses and income taxes | 16.1 | 16.7 | (0.9) | 52.9 |
Reorganization expenses | (6.8) | (5) | (14.8) | (16.7) |
Income (loss) before income taxes | 9.3 | 11.7 | (15.7) | 36.2 |
Income tax benefit (expense) | (3.7) | (5.1) | 5.9 | (12.6) |
Net income (loss) | 5.6 | 6.6 | (9.8) | 23.6 |
Comprehensive income (loss) | $ 5 | $ 0.6 | $ (9) | $ 13.6 |
Garlock Sealing Technologies 62
Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd. - Schedule of Condensed Combined Statements of Cash Flows (Detail) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Supplemental Cash Flow Information [Line Items] | ||
Net cash from operating activities | $ 7.9 | $ 32 |
Purchases of property, plant and equipment | (24.6) | (23.4) |
Net payments on loans to affiliates | 0 | 0 |
Other | 3.7 | 0.3 |
Net cash used in investing activities | (52.5) | (72.2) |
Effect of exchange rate changes on cash and cash equivalents | (11.7) | (2.7) |
Net increase (decrease) in cash and cash equivalents | 11.4 | (102.2) |
Cash and cash equivalents at beginning of period | 103.4 | 194.2 |
Cash and cash equivalents at end of period | 114.8 | 92 |
Garlock Sealing Technologies [Member] | ||
Supplemental Cash Flow Information [Line Items] | ||
Net cash from operating activities | 32.9 | 44.5 |
Purchases of property, plant and equipment | (5.1) | (3.6) |
Net payments on loans to affiliates | (5.2) | (3.6) |
Payments to Acquire Held-to-maturity Securities | (50.5) | (29.6) |
Other | (0.2) | 0 |
Net cash used in investing activities | (61) | (36.8) |
Effect of exchange rate changes on cash and cash equivalents | 1.4 | (3.3) |
Net increase (decrease) in cash and cash equivalents | (26.7) | 4.4 |
Cash and cash equivalents at beginning of period | 71.9 | 66 |
Cash and cash equivalents at end of period | $ 45.2 | $ 70.4 |
Garlock Sealing Technologies 63
Garlock Sealing Technologies LLC and Garrison Litigation Management Group, Ltd. - Schedule of Condensed Combined Balance Sheets (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 | |
Prepaid expenses and other current assets | $ 36.6 | $ 23.6 | |
Deferred income taxes | 149.1 | 109.3 | |
Other assets | 38.1 | 36.9 | |
Total assets | 1,581.5 | 1,498.8 | |
Current liabilities | 534.4 | 278.7 | |
Other liabilities | 90.5 | 103.1 | |
Total liabilities | 1,197.4 | 1,039 | |
Shareholder's equity | 384.1 | 459.8 | |
Liabilities and Equity | 1,581.5 | 1,498.8 | |
Garlock Sealing Technologies [Member] | |||
Notes Receivable, Related Parties, Current | 295.9 | 12.2 | |
Prepaid expenses and other current assets | 410.5 | 393.9 | |
Asbestos insurance receivable | 49 | 62 | |
Deferred income taxes | 126.8 | 105.6 | |
Notes receivable from affiliate | 0 | 271 | |
Other assets | 67.7 | 67.8 | |
Total assets | 949.9 | 912.5 | |
Current liabilities | 33.9 | 40.5 | |
Other liabilities | 117.6 | 114.4 | |
Liabilities subject to compromise | [1] | 388.6 | 339.1 |
Total liabilities | 540.1 | 494 | |
Shareholder's equity | 409.8 | 418.5 | |
Liabilities and Equity | $ 949.9 | $ 912.5 | |
[1] | as of September 30, 2016 for asbestos related claims. The accrual consists of of (a) $370 million to be contributed to the trust for present and future asbestos claims against GST plus litigation and administrative expenses, and (b) an estimate of $17.0 million for the resolution of all current and future Canadian asbestos claims alleging disease resulting in whole or in part from exposure to GST asbestos-containing products. See Note 17, “Commitments and Contingencies - Asbestos - Liability Estimate." |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) € in Millions | Jan. 14, 2015USD ($) | Sep. 30, 2003site | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($)site | Mar. 31, 2016USD ($) | Jun. 30, 2014USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2016EUR (€)misite | Sep. 30, 2016USD ($)misite | Dec. 31, 2014USD ($) | Apr. 11, 2014mi | Jun. 05, 2010USD ($) |
Site Contingency [Line Items] | ||||||||||||||
Loss Contingency, Estimate of Possible Loss | $ 400,000 | |||||||||||||
Litigation Settlement, Amount | $ 2,700,000 | |||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations, Claims | 17,000,000 | |||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | $ 30,000,000 | 110,000,000 | ||||||||||||
Trent Tube Facility, East Troy, Wisconsin [Abstract] | ||||||||||||||
Accrual for Environmental Loss Contingencies, Provision for New Losses | $ 1,100,000 | $ 1,200,000 | 1,100,000 | |||||||||||
Investigative Sites Notice From The EPA | site | 6 | |||||||||||||
Lower Passaic River Study Area, Diamond Alkali Superfund Site, New Jersey [Abstract] | ||||||||||||||
Accrual for Environmental Loss Contingencies | 16,800,000 | $ 20,700,000 | ||||||||||||
Site Contingency, Number of Sites Subject to Remediation Activities, Total | site | 14 | 14 | ||||||||||||
Site Contingency, Sites Subject to Remediation Activities, Cost per Site, De Minimis Threshold | 100,000 | |||||||||||||
Site Contingency, Number of Sites Subject to Remediation Activities, Investigation Completed | site | 10 | 10 | ||||||||||||
Site Contingency, Number of Sites Subject to Remediation Activities, Investigation in Progress | site | 4 | 4 | ||||||||||||
Site Contingency Number of Other Potentially Responsible Parties | site | 70 | |||||||||||||
Lower Passaic River Study Area, Focused Feasibility Study, April 11, 2014 [Member] | ||||||||||||||
Lower Passaic River Study Area, Diamond Alkali Superfund Site, New Jersey [Abstract] | ||||||||||||||
Accrual for Environmental Loss Contingencies | $ 3,500,000 | |||||||||||||
Coltec Industries Inc. [Member] | ||||||||||||||
Lower Passaic River Study Area, Diamond Alkali Superfund Site, New Jersey [Abstract] | ||||||||||||||
Accrual for Environmental Loss Contingencies | 1,300,000 | $ 1,100,000 | ||||||||||||
Minimum [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Loss Contingency Accrual | € | € 0.4 | |||||||||||||
Lower Passaic River Study Area, Diamond Alkali Superfund Site, New Jersey [Abstract] | ||||||||||||||
Portion Of Site Subject To Remediation | mi | 9 | 9 | 8 | |||||||||||
Minimum [Member] | Lower Passaic River Study Area, Focused Feasibility Study, April 11, 2014 [Member] | ||||||||||||||
Lower Passaic River Study Area, Diamond Alkali Superfund Site, New Jersey [Abstract] | ||||||||||||||
Site Contingency, Loss Exposure in Excess of Accrual, Best Estimate | $ 953,000,000 | |||||||||||||
Maximum [Member] | ||||||||||||||
Lower Passaic River Study Area, Diamond Alkali Superfund Site, New Jersey [Abstract] | ||||||||||||||
Portion Of Site Subject To Remediation | mi | 17 | 17 | ||||||||||||
Site Contingency, Loss Exposure in Excess of Accrual, Best Estimate | $ 1,380,000,000 | 1,730,000,000 | ||||||||||||
OldCo [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Litigation Settlement, Amount | 50,000,000 | |||||||||||||
EnPro And Subsidiaries And GST [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Litigation Settlement, Amount | 480,000,000 | |||||||||||||
New Coltec [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Litigation Settlement, Amount | $ 20,000,000 | |||||||||||||
Coltec Industries Inc. [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Litigation Settlement, Amount | 110,000,000 | |||||||||||||
GST, LLC [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Litigation Settlement, Amount | 370,000,000 | |||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations, Claims | $ 17,000,000 | |||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | $ 280,500,000 | $ 337,500,000 | $ 387,000,000 | |||||||||||
New Coltec [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Litigation Settlement, Amount | 60,000,000 | |||||||||||||
Arizona | ||||||||||||||
Trent Tube Facility, East Troy, Wisconsin [Abstract] | ||||||||||||||
Investigative Sites Notice From The EPA | site | 2 | 2 | ||||||||||||
Asbestos Issue [Member] | Minimum [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | $ 472,100,000 | |||||||||||||
Asbestos Issue [Member] | Coltec Industries Inc. [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Administrative and Litigation Costs | 30,000,000 | |||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | 367,500,000 | |||||||||||||
Asbestos Issue [Member] | GST, LLC [Member] | ||||||||||||||
Site Contingency [Line Items] | ||||||||||||||
Proceeds from Insurance Settlement, Operating Activities | $ 18,000,000 | $ 134,600,000 | ||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Administrative and Litigation Costs | $ 220,000,000 |
Commitments and Contingencies65
Commitments and Contingencies - Additional Information (Detail) | Jan. 14, 2015USD ($) | May 29, 2014USD ($) | Jan. 10, 2014USD ($) | Aug. 31, 2014USD ($) | Sep. 30, 2011USD ($) | May 31, 2011USD ($) | Jun. 30, 2016USD ($)site | Mar. 31, 2016USD ($) | Jun. 30, 2014USD ($) | Sep. 30, 2016USD ($)miLegalMattersiteClaim | Dec. 31, 2015USD ($) | Sep. 30, 2016USD ($)miLegalMattersiteClaim | Sep. 30, 2015LegalMatter | Nov. 03, 2016USD ($) | Mar. 31, 2015USD ($) | Apr. 11, 2014mi | Jun. 05, 2010USD ($)LegalMatter |
Loss Contingencies [Line Items] | |||||||||||||||||
Loss Contingency, Estimate of Possible Loss | $ 400,000 | $ 400,000 | |||||||||||||||
Site Contingency, Number of Sites Subject to Remediation Activities, Total | site | 14 | 14 | |||||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | $ 110,000,000 | $ 30,000,000 | $ 110,000,000 | ||||||||||||||
Product Liability Contingency, Legal Appeals [Abstract] | |||||||||||||||||
Litigation Settlement, Amount | $ 2,700,000 | ||||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Accrual for Environmental Loss Contingencies, Provision for New Losses | $ 1,100,000 | 1,200,000 | 1,100,000 | ||||||||||||||
Investigative Sites Notice From The EPA | site | 6 | ||||||||||||||||
Accrual for Environmental Loss Contingencies, Component Amount | $ 2,200,000 | ||||||||||||||||
Accrual for Environmental Loss Contingencies | $ 20,700,000 | 16,800,000 | $ 20,700,000 | ||||||||||||||
SiteContingency Remidial Investigation Feasibility Study Estimate Of Cost | $ 726,000,000 | ||||||||||||||||
Percentage of Claimants Required to Approve Joint Plan | 75.00% | 75.00% | |||||||||||||||
Asbestos Issue [Member] | |||||||||||||||||
Product Liability Contingency, Insurance Coverage [Abstract] | |||||||||||||||||
Loss Contingency, Insurance Coverage, Amount | $ 62,000,000 | $ 62,000,000 | |||||||||||||||
Loss Contingency, Receivable | 28,200,000 | 28,200,000 | |||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Loss Contingency, Estimated Insurance Recoveries, after Year Five | 38,000,000 | 38,000,000 | |||||||||||||||
GST, LLC [Member] | |||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | $ 280,500,000 | 387,000,000 | $ 337,500,000 | 387,000,000 | |||||||||||||
Product Liability Contingency, Legal Appeals [Abstract] | |||||||||||||||||
Litigation Settlement, Amount | 370,000,000 | ||||||||||||||||
GST, LLC [Member] | Asbestos Issue [Member] | |||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||
Product Liability Contingency, Loss Exposure Not Accrued, Best Estimate | 0 | ||||||||||||||||
Loss Contingency, Insurance Coverage, Amount Recovered, Insolvent Carrier | 8,600,000 | 8,600,000 | |||||||||||||||
Product Liability Contingency, Insurance Coverage [Abstract] | |||||||||||||||||
Loss Contingency, Insurance Coverage, Amount Submitted for Reimbursement | 25,900,000 | 25,900,000 | |||||||||||||||
Proceeds from Insurance Settlement, Operating Activities | 18,000,000 | 134,600,000 | |||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Administrative and Litigation Costs | $ 220,000,000 | ||||||||||||||||
GST, LLC [Member] | Asbestos Issue Mesothelioma [Member] | |||||||||||||||||
Product Liability Contingency, Pending Claims [Abstract] | |||||||||||||||||
Product Liability Contingency, Claims Paid before Insurance Recoveries, Mesothelioma | $ 563,200,000 | $ 563,200,000 | |||||||||||||||
Bankruptcy Claims, Number of Claims Settled | LegalMatter | 15,300 | 15,300 | |||||||||||||||
Loss Contingency, Claims Dismissed, Number | LegalMatter | 5,700 | ||||||||||||||||
Bankruptcy Claims, Number of Claims under Review by Management [Abstract] | |||||||||||||||||
Bankruptcy Claims, Number of Claims under Review by Management | LegalMatter | 5,800 | ||||||||||||||||
Coltec Industries Inc. [Member] | |||||||||||||||||
Product Liability Contingency, Legal Appeals [Abstract] | |||||||||||||||||
Litigation Settlement, Amount | $ 110,000,000 | ||||||||||||||||
Coltec Industries Inc. [Member] | Asbestos Issue [Member] | |||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | 367,500,000 | ||||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal, Administrative and Litigation Costs | $ 30,000,000 | ||||||||||||||||
OldCo [Member] | |||||||||||||||||
Product Liability Contingency, Legal Appeals [Abstract] | |||||||||||||||||
Litigation Settlement, Amount | $ 50,000,000 | ||||||||||||||||
Minimum [Member] | |||||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Portion Of Site Subject To Remediation | mi | 9 | 9 | 8 | ||||||||||||||
Minimum [Member] | Asbestos Issue [Member] | |||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||
Liabilities Subject to Compromise, Asbestos Obligations | $ 472,100,000 | ||||||||||||||||
Minimum [Member] | GST, LLC [Member] | Asbestos Issue [Member] | |||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||
Plan of Reorganization, Loss Contingency Trust, Contribution, Amended Proposal | $ 275,000,000 | ||||||||||||||||
Product Liability Contingency, Background [Abstract] | |||||||||||||||||
Number of asbestos claims processed | LegalMatter | 900,000 | ||||||||||||||||
Product Liability Contingency, Claims Paid before Insurance Recoveries | $ 1,400,000,000 | $ 1,400,000,000 | |||||||||||||||
Product Liability Contingency, Claims Paid before Insurance Recoveries, Fees and Expenses | $ 400,000,000 | ||||||||||||||||
Minimum [Member] | GST, LLC [Member] | Asbestos Issue Mesothelioma [Member] | |||||||||||||||||
Product Liability Contingency, Pending Claims [Abstract] | |||||||||||||||||
Loss Contingency, Pending Claims, Number | LegalMatter | 90,000 | ||||||||||||||||
Bankruptcy Claims, Number of Claims under Review by Management [Abstract] | |||||||||||||||||
Bankruptcy Claims, Number of Claims, Non-response to Filing Requirement | Claim | 500 | 500 | |||||||||||||||
Bankruptcy Claims, Number of Claims, Filing Requirement Documentation Failed to Support Claim | Claim | 1,900 | 1,900 | |||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Plan of Reorganization, Loss Contingency, Court Estimate | $ 125,000,000 | ||||||||||||||||
Maximum [Member] | |||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||
Site Contingency, Loss Exposure in Excess of Accrual, Best Estimate | 1,380,000,000 | $ 1,730,000,000 | |||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Portion Of Site Subject To Remediation | mi | 17 | 17 | |||||||||||||||
Maximum [Member] | GST, LLC [Member] | Asbestos Issue Mesothelioma [Member] | |||||||||||||||||
Product Liability Contingency, Pending Claims [Abstract] | |||||||||||||||||
Loss Contingency, Pending Claims, Number | Claim | 3,300 | 3,300 | |||||||||||||||
United States Court of Appeals for the Sixth Circuit, Overturned Verdict by Kentucky Federal Court [Member] | GST, LLC [Member] | Asbestos Issue Mesothelioma [Member] | |||||||||||||||||
Product Liability Contingency, Legal Appeals [Abstract] | |||||||||||||||||
Litigation Settlement, Amount | $ 500,000 | ||||||||||||||||
Kentucky Court of Appeals, Denied Appeal, Upholding Kentucky State Court Verdict [Member] | GST, LLC [Member] | Asbestos Issue [Member] | |||||||||||||||||
Product Liability Contingency, Legal Appeals [Abstract] | |||||||||||||||||
Loss Contingency, Damages Awarded, Value | $ 700,000 | ||||||||||||||||
Kentucky Court of Appeals, Denied Appeal, Upholding prior Kentucky Court of Appeals Verdict [Member] | GST, LLC [Member] | Asbestos Issue [Member] | |||||||||||||||||
Product Liability Contingency, Legal Appeals [Abstract] | |||||||||||||||||
Loss Contingency, Damages Awarded, Value | $ 874,000 | ||||||||||||||||
Loss Contingency, Punitive Damages Awarded, Before Allocation, Value | 600,000 | ||||||||||||||||
Loss Contingency, Appeal Bond, Value | $ 1,100,000 | ||||||||||||||||
Onondaga Site EPA Remedial Investigation [Domain] | |||||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Accrual for Environmental Loss Contingencies, Provision for New Losses | $ 1,500,000 | ||||||||||||||||
Coltec Industries Inc. [Member] | |||||||||||||||||
Loss Contingency Accrual, Disclosures [Abstract] | |||||||||||||||||
Accrual for Environmental Loss Contingencies | $ 1,300,000 | $ 1,100,000 | $ 1,100,000 | ||||||||||||||
Subsequent Event [Member] | |||||||||||||||||
Loss Contingencies [Line Items] | |||||||||||||||||
Site Contingency, Focused Feasibility Study, Estimate of Cost, Low End of Range | $ 165,000,000 |
Commitments and Contingencies66
Commitments and Contingencies - Schedule of Changes in Carrying Amount of Product Warranty Liability (Detail) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Balance at beginning of year | $ 4.8 | $ 3.5 |
Net charges (credits) to expense | 3.3 | 2 |
Settlements made | (3.4) | (1.9) |
Balance at end of period | $ 4.7 | $ 3.6 |
Commitments and Contingencies67
Commitments and Contingencies - Schedule of Future Insurance Proceeds (Detail) Claim in Thousands, $ in Millions | Sep. 30, 2016USD ($) | Oct. 06, 2015Claim |
Loss Contingencies [Line Items] | ||
Proofs Of Claim Filed | Claim | 180 | |
Loss Contingency, Estimated Insurance Recoveries [Abstract] | ||
Proofs Of Claim Filed Alleging Mesothelioma | Claim | 10 | |
Asbestos Issue [Member] | ||
Loss Contingency, Estimated Insurance Recoveries [Abstract] | ||
Loss Contingency, Receivable | $ 28.2 | |
Loss Contingency, Estimated Insurance Recoveries | 13 | |
Loss Contingency, Estimated Insurance Recoveries, Year Two | 11 | |
GST, LLC [Member] | Asbestos Issue [Member] | ||
Loss Contingency, Estimated Insurance Recoveries [Abstract] | ||
Loss Contingency, Insurance Coverage, Amount Recovered, Insolvent Carrier | $ 8.6 |
Supplemental Guarantor Financ68
Supplemental Guarantor Financial Information Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2016 | Sep. 30, 2015 | Dec. 31, 2015 | |
Condensed Financial Statements, Captions [Line Items] | |||||
Net sales | $ 292.7 | $ 306.6 | $ 900.8 | $ 882.5 | |
Cost of sales | 194.1 | 205.2 | 596.7 | 590 | |
Gross profit | 98.6 | 101.4 | 304.1 | 292.5 | |
Operating expenses: | |||||
Selling, general and administrative | 70.9 | 74.8 | 231.7 | 226.2 | |
Goodwill and Intangible Asset Impairment | 0 | 0 | 0 | 47 | |
Asbestos Related Expenses | 0 | 0 | 80 | 0 | |
Other | 2.4 | 1.7 | 10.4 | 3.3 | |
Total operating expenses | 73.3 | 76.5 | 322.1 | 276.5 | |
Operating income (loss) | 25.3 | 24.9 | (18) | 16 | |
Interest income (expense), net | (14) | (12.8) | (41) | (38.6) | |
Other expense | (1.3) | 0.1 | (5.4) | (4.2) | |
Income (loss) before income taxes | 10 | 12.2 | (64.4) | (26.8) | |
Income tax benefit (expense) | (4) | (0.8) | 27.2 | (0.7) | |
Income (loss) before equity in earnings of subsidiaries | 6 | 11.4 | (37.2) | (27.5) | |
Equity in earnings of subsidiaries, net of tax | 0 | 0 | 0 | 0 | |
Net income (loss) | 6 | 11.4 | (37.2) | (27.5) | |
Comprehensive income (loss) | 6.6 | 7.5 | (38.6) | (39.5) | |
Other Long-term Debt | $ 4.7 | ||||
Eliminations [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Net sales | (19.5) | (19.2) | (63.3) | (39.8) | |
Cost of sales | (19.5) | (19.2) | (63.3) | (39.8) | |
Gross profit | 0 | 0 | 0 | 0 | |
Operating expenses: | |||||
Selling, general and administrative | 0 | 0 | 0 | 0 | |
Asbestos Related Expenses | 0 | ||||
Other | 0 | 0 | 0 | 0 | |
Total operating expenses | 0 | 0 | 0 | 0 | |
Operating income (loss) | 0 | 0 | 0 | 0 | |
Interest income (expense), net | 0 | 0 | 0 | 0 | |
Other expense | 0 | 0 | 0 | 0 | |
Income (loss) before income taxes | 0 | 0 | 0 | 0 | |
Income tax benefit (expense) | 0 | 0 | 0 | 0 | |
Income (loss) before equity in earnings of subsidiaries | 0 | 0 | 0 | 0 | |
Equity in earnings of subsidiaries, net of tax | (12.4) | (26.5) | 5.2 | 32.2 | |
Net income (loss) | (12.4) | (26.5) | 5.2 | 32.2 | |
Comprehensive income (loss) | (12.5) | (17.6) | 11.2 | 59.3 | |
Parent [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Net sales | 0 | 0 | 0 | 0 | |
Cost of sales | 0 | 0 | 0 | 0 | |
Gross profit | 0 | 0 | 0 | 0 | |
Operating expenses: | |||||
Selling, general and administrative | 6.3 | 6.5 | 20.8 | 18.7 | |
Asbestos Related Expenses | 0 | ||||
Other | 0.4 | 0.7 | 1.7 | 0.9 | |
Total operating expenses | 6.7 | 7.2 | 22.5 | 19.6 | |
Operating income (loss) | (6.7) | (7.2) | (22.5) | (19.6) | |
Interest income (expense), net | (4.7) | (4.7) | (13.9) | (8.5) | |
Other expense | 0 | 0 | 0 | (2.8) | |
Income (loss) before income taxes | (11.4) | (11.9) | (36.4) | (30.9) | |
Income tax benefit (expense) | 8.4 | 2.3 | 13.1 | 8 | |
Income (loss) before equity in earnings of subsidiaries | (3) | (9.6) | (23.3) | (22.9) | |
Equity in earnings of subsidiaries, net of tax | 9 | 21 | (13.9) | (4.6) | |
Net income (loss) | 6 | 11.4 | (37.2) | (27.5) | |
Comprehensive income (loss) | 6.6 | 7.5 | (38.6) | (39.5) | |
Guarantor Subsidiaries [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Net sales | 207.1 | 212.9 | 630.2 | 609.7 | |
Cost of sales | 144.8 | 147.2 | 442 | 426.1 | |
Gross profit | 62.3 | 65.7 | 188.2 | 183.6 | |
Operating expenses: | |||||
Selling, general and administrative | 37.9 | 40.7 | 124.2 | 118 | |
Goodwill and Intangible Asset Impairment | 5.6 | ||||
Asbestos Related Expenses | 80 | ||||
Other | 0.1 | 0.6 | 2.9 | 0.6 | |
Total operating expenses | 38 | 41.3 | 207.1 | 124.2 | |
Operating income (loss) | 24.3 | 24.4 | (18.9) | 59.4 | |
Interest income (expense), net | (9.3) | (8) | (26.9) | (29.9) | |
Other expense | (1.2) | 0.1 | (5.1) | (1.4) | |
Income (loss) before income taxes | 13.8 | 16.5 | (50.9) | 28.1 | |
Income tax benefit (expense) | (8.2) | (1) | 28.3 | (5.1) | |
Income (loss) before equity in earnings of subsidiaries | 5.6 | 15.5 | (22.6) | 23 | |
Equity in earnings of subsidiaries, net of tax | 3.4 | 5.5 | 8.7 | (27.6) | |
Net income (loss) | 9 | 21 | (13.9) | (4.6) | |
Comprehensive income (loss) | 9.5 | 17.1 | (15.4) | (16.6) | |
Non-Guarantor Subsidiaries [Member] | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Net sales | 105.1 | 112.9 | 333.9 | 312.6 | |
Cost of sales | 68.8 | 77.2 | 218 | 203.7 | |
Gross profit | 36.3 | 35.7 | 115.9 | 108.9 | |
Operating expenses: | |||||
Selling, general and administrative | 26.7 | 27.6 | 86.7 | 89.5 | |
Goodwill and Intangible Asset Impairment | 41.4 | ||||
Asbestos Related Expenses | 0 | ||||
Other | 1.9 | 0.4 | 5.8 | 1.8 | |
Total operating expenses | 28.6 | 28 | 92.5 | 132.7 | |
Operating income (loss) | 7.7 | 7.7 | 23.4 | (23.8) | |
Interest income (expense), net | 0 | (0.1) | (0.2) | (0.2) | |
Other expense | (0.1) | 0 | (0.3) | 0 | |
Income (loss) before income taxes | 7.6 | 7.6 | 22.9 | (24) | |
Income tax benefit (expense) | (4.2) | (2.1) | (14.2) | (3.6) | |
Income (loss) before equity in earnings of subsidiaries | 3.4 | 5.5 | 8.7 | (27.6) | |
Equity in earnings of subsidiaries, net of tax | 0 | 0 | 0 | 0 | |
Net income (loss) | 3.4 | 5.5 | 8.7 | (27.6) | |
Comprehensive income (loss) | $ 3 | $ 0.5 | $ 4.2 | $ (42.7) |
Supplemental Guarantor Financ69
Supplemental Guarantor Financial Information Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by (used in) operating activities | $ 7.9 | $ 32 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (24.6) | (23.4) |
Payments for capitalized internal-use software | (3.1) | (3.6) |
Acquisitions, net of cash acquired | (28.5) | (45.5) |
Other | 3.7 | 0.3 |
Net cash used in investing activities | (52.5) | (72.2) |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | 0 | 0 |
Proceeds from debt | 303.3 | 181.3 |
Repayments of debt | (192.7) | (123.1) |
Repurchase of common stock | (26.2) | (80) |
Dividends paid | (13.6) | (13.8) |
Repurchase of convertible debentures conversion option | 0 | (21.6) |
Other | (3.1) | (2.1) |
Net cash provided by (used in) financing activities | 67.7 | (59.3) |
Effect of exchange rate changes on cash and cash equivalents | (11.7) | (2.7) |
Net increase (decrease) in cash and cash equivalents | 11.4 | (102.2) |
Cash and cash equivalents at beginning of period | 103.4 | 194.2 |
Cash and cash equivalents at end of period | 114.8 | 92 |
Eliminations [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by (used in) operating activities | 0 | 0 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | 0 | 0 |
Payments for capitalized internal-use software | 0 | 0 |
Acquisitions, net of cash acquired | 0 | 0 |
Other | 0 | 0 |
Net cash used in investing activities | 0 | 0 |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | 0 | 0 |
Proceeds from debt | 0 | 0 |
Repayments of debt | 0 | 0 |
Other | 0 | 0 |
Net cash provided by (used in) financing activities | 0 | 0 |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents at beginning of period | 0 | 0 |
Cash and cash equivalents at end of period | 0 | 0 |
Parent [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by (used in) operating activities | (51.6) | (36.6) |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | 0 | (0.1) |
Payments for capitalized internal-use software | 0 | 0 |
Acquisitions, net of cash acquired | 0 | 0 |
Other | 0 | 0 |
Net cash used in investing activities | 0 | (0.1) |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | 94.5 | 177.5 |
Proceeds from debt | 0 | 0 |
Repayments of debt | 0 | (23.3) |
Repurchase of common stock | (26.2) | (80) |
Dividends paid | (13.6) | (13.8) |
Repurchase of convertible debentures conversion option | (21.6) | |
Other | (3.1) | (2.1) |
Net cash provided by (used in) financing activities | 51.6 | 36.7 |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents at beginning of period | 0 | 0 |
Cash and cash equivalents at end of period | 0 | 0 |
Guarantor Subsidiaries [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by (used in) operating activities | 33.9 | 45.7 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (19.5) | (17.8) |
Payments for capitalized internal-use software | (2.8) | (2.5) |
Acquisitions, net of cash acquired | (25.5) | (42.4) |
Other | 2.9 | 0.1 |
Net cash used in investing activities | (44.9) | (62.6) |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | (95.2) | (175.9) |
Proceeds from debt | 297.2 | 177.7 |
Repayments of debt | (191.7) | (99.8) |
Other | 0 | 0 |
Net cash provided by (used in) financing activities | 10.3 | (98) |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash and cash equivalents | (0.7) | (114.9) |
Cash and cash equivalents at beginning of period | 0.7 | 114.9 |
Cash and cash equivalents at end of period | 0 | 0 |
Non-Guarantor Subsidiaries [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by (used in) operating activities | 25.6 | 22.9 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (5.1) | (5.5) |
Payments for capitalized internal-use software | (0.3) | (1.1) |
Acquisitions, net of cash acquired | (3) | (3.1) |
Other | 0.8 | 0.2 |
Net cash used in investing activities | (7.6) | (9.5) |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | 0.7 | (1.6) |
Proceeds from debt | 6.1 | 3.6 |
Repayments of debt | (1) | 0 |
Other | 0 | 0 |
Net cash provided by (used in) financing activities | 5.8 | 2 |
Effect of exchange rate changes on cash and cash equivalents | (11.7) | (2.7) |
Net increase (decrease) in cash and cash equivalents | 12.1 | 12.7 |
Cash and cash equivalents at beginning of period | 102.7 | 79.3 |
Cash and cash equivalents at end of period | $ 114.8 | $ 92 |
Supplemental Guarantor Financ70
Supplemental Guarantor Financial Information Condensed Consolidating Balance Sheets (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets | ||||
Cash and cash equivalents | $ 114.8 | $ 103.4 | $ 92 | $ 194.2 |
Accounts receivable, net | 222.6 | 212.5 | ||
Intercompany receivables | 0 | 0 | ||
Inventories | 178.9 | 178.4 | ||
Prepaid expenses and other current assets | 36.6 | 23.6 | ||
Total current assets | 552.9 | 517.9 | ||
Property, plant and equipment, net | 216.2 | 211.5 | ||
Goodwill | 203.5 | 195.9 | ||
Other intangible assets, net | 184.8 | 190.4 | ||
Investment in GST | 236.9 | 236.9 | ||
Intercompany receivables | 0 | 0 | ||
Investment in subsidiaries | 0 | 0 | ||
Other Assets | 187.2 | 146.2 | ||
Total assets | 1,581.5 | 1,498.8 | ||
Current liabilities | ||||
Short-term borrowings from GST | 27.8 | 24.3 | ||
Notes payable to GST | 295.9 | 12.2 | ||
Current maturities of long-term debt | 0.1 | 0.1 | ||
Accounts payable | 89.1 | 101.5 | ||
Intercompany payables | 0 | 0 | ||
Accrued expenses | 121.5 | 140.6 | ||
Total current liabilities | 534.4 | 278.7 | ||
Long-term debt | 462.5 | 356.2 | ||
Notes payable to GST | 0 | 271 | ||
Intercompany payables | 0 | 0 | ||
Other liabilities | 200.5 | 133.1 | ||
Total liabilities | 1,197.4 | 1,039 | ||
Shareholder's equity | 384.1 | 459.8 | ||
Total liabilities and equity | 1,581.5 | 1,498.8 | ||
Eliminations [Member] | ||||
Current assets | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | ||
Intercompany receivables | (14.1) | (19.8) | ||
Inventories | 0 | 0 | ||
Prepaid expenses and other current assets | (12.6) | (11.1) | ||
Total current assets | (26.7) | (30.9) | ||
Property, plant and equipment, net | 0 | 0 | ||
Goodwill | 0 | 0 | ||
Other intangible assets, net | 0 | 0 | ||
Investment in GST | 0 | 0 | ||
Intercompany receivables | (58.7) | (79.9) | ||
Investment in subsidiaries | (935.6) | (934.8) | ||
Other Assets | 0 | (9.9) | ||
Total assets | (1,021) | (1,055.5) | ||
Current liabilities | ||||
Short-term borrowings from GST | 0 | 0 | ||
Notes payable to GST | 0 | 0 | ||
Current maturities of long-term debt | 0 | 0 | ||
Accounts payable | 0 | 0 | ||
Intercompany payables | (14.1) | (19.8) | ||
Accrued expenses | (12.6) | (11.1) | ||
Total current liabilities | (26.7) | (30.9) | ||
Long-term debt | 0 | 0 | ||
Notes payable to GST | 0 | |||
Intercompany payables | (58.7) | (79.9) | ||
Other liabilities | 0 | (9.9) | ||
Total liabilities | (85.4) | (120.7) | ||
Shareholder's equity | (935.6) | (934.8) | ||
Total liabilities and equity | (1,021) | (1,055.5) | ||
Parent [Member] | ||||
Current assets | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0.1 | ||
Intercompany receivables | 0 | 0 | ||
Inventories | 0 | 0 | ||
Prepaid expenses and other current assets | 26.9 | 13.6 | ||
Total current assets | 26.9 | 13.7 | ||
Property, plant and equipment, net | 0.1 | 0.1 | ||
Goodwill | 0 | 0 | ||
Other intangible assets, net | 0 | 0 | ||
Investment in GST | 0 | 0 | ||
Intercompany receivables | 7.8 | 65.8 | ||
Investment in subsidiaries | 689.4 | 693 | ||
Other Assets | 16.4 | 14.8 | ||
Total assets | 740.6 | 787.4 | ||
Current liabilities | ||||
Short-term borrowings from GST | 0 | 0 | ||
Notes payable to GST | 0 | 0 | ||
Current maturities of long-term debt | 0 | 0 | ||
Accounts payable | 1 | 2.3 | ||
Intercompany payables | 0 | 0 | ||
Accrued expenses | 7.6 | 17.7 | ||
Total current liabilities | 8.6 | 20 | ||
Long-term debt | 293.9 | 293.3 | ||
Notes payable to GST | 0 | |||
Intercompany payables | 40.7 | 4.2 | ||
Other liabilities | 13.3 | 10.1 | ||
Total liabilities | 356.5 | 327.6 | ||
Shareholder's equity | 384.1 | 459.8 | ||
Total liabilities and equity | 740.6 | 787.4 | ||
Guarantor Subsidiaries [Member] | ||||
Current assets | ||||
Cash and cash equivalents | 0 | 0.7 | 0 | 114.9 |
Accounts receivable, net | 162.6 | 153.2 | ||
Intercompany receivables | 8.2 | 8.1 | ||
Inventories | 124.9 | 126.4 | ||
Prepaid expenses and other current assets | 8.5 | 11.2 | ||
Total current assets | 304.2 | 299.6 | ||
Property, plant and equipment, net | 144.4 | 135.1 | ||
Goodwill | 175.4 | 167.6 | ||
Other intangible assets, net | 161 | 162.6 | ||
Investment in GST | 236.9 | 236.9 | ||
Intercompany receivables | 49.9 | 12.7 | ||
Investment in subsidiaries | 246.2 | 241.8 | ||
Other Assets | 150.7 | 122 | ||
Total assets | 1,468.7 | 1,378.3 | ||
Current liabilities | ||||
Short-term borrowings from GST | 0 | 0 | ||
Notes payable to GST | 295.9 | 12.2 | ||
Current maturities of long-term debt | 0.1 | 0.1 | ||
Accounts payable | 52.2 | 59.3 | ||
Intercompany payables | 5.9 | 11.7 | ||
Accrued expenses | 83.4 | 89.6 | ||
Total current liabilities | 437.5 | 172.9 | ||
Long-term debt | 168.6 | 62.9 | ||
Notes payable to GST | 271 | |||
Intercompany payables | 8.1 | 66.1 | ||
Other liabilities | 165.1 | 112.4 | ||
Total liabilities | 779.3 | 685.3 | ||
Shareholder's equity | 689.4 | 693 | ||
Total liabilities and equity | 1,468.7 | 1,378.3 | ||
Non-Guarantor Subsidiaries [Member] | ||||
Current assets | ||||
Cash and cash equivalents | 114.8 | 102.7 | $ 92 | $ 79.3 |
Accounts receivable, net | 60 | 59.2 | ||
Intercompany receivables | 5.9 | 11.7 | ||
Inventories | 54 | 52 | ||
Prepaid expenses and other current assets | 13.8 | 9.9 | ||
Total current assets | 248.5 | 235.5 | ||
Property, plant and equipment, net | 71.7 | 76.3 | ||
Goodwill | 28.1 | 28.3 | ||
Other intangible assets, net | 23.8 | 27.8 | ||
Investment in GST | 0 | 0 | ||
Intercompany receivables | 1 | 1.4 | ||
Investment in subsidiaries | 0 | 0 | ||
Other Assets | 20.1 | 19.3 | ||
Total assets | 393.2 | 388.6 | ||
Current liabilities | ||||
Short-term borrowings from GST | 27.8 | 24.3 | ||
Notes payable to GST | 0 | 0 | ||
Current maturities of long-term debt | 0 | 0 | ||
Accounts payable | 35.9 | 39.9 | ||
Intercompany payables | 8.2 | 8.1 | ||
Accrued expenses | 43.1 | 44.4 | ||
Total current liabilities | 115 | 116.7 | ||
Long-term debt | 0 | 0 | ||
Notes payable to GST | 0 | |||
Intercompany payables | 9.9 | 9.6 | ||
Other liabilities | 22.1 | 20.5 | ||
Total liabilities | 147 | 146.8 | ||
Shareholder's equity | 246.2 | 241.8 | ||
Total liabilities and equity | $ 393.2 | $ 388.6 |