Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 04, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-31225 | |
Entity Registrant Name | ENPRO INDUSTRIES, INC | |
Entity Central Index Key | 0001164863 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Entity Incorporation, State or Country Code | NC | |
Entity Tax Identification Number | 01-0573945 | |
Entity Address, Address Line One | 5605 Carnegie Boulevard | |
Entity Address, Address Line Two | Suite 500 | |
Entity Address, City or Town | Charlotte | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 28209 | |
City Area Code | 704 | |
Local Phone Number | 731-1500 | |
Title of 12(b) Security | Common stock, $0.01 par value | |
Trading Symbol | NPO | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 20,783,987 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Statement [Abstract] | ||||
Net sales | $ 373 | $ 388.2 | $ 1,120.3 | $ 1,150.6 |
Cost of sales | 258 | 264.1 | 767.1 | 785.6 |
Gross profit | 115 | 124.1 | 353.2 | 365 |
Operating expenses: | ||||
Selling, general and administrative | 84.1 | 78.9 | 255.7 | 260.4 |
Other | 2.3 | 1 | 4.7 | 6.3 |
Total operating expenses | 86.4 | 79.9 | 260.4 | 266.7 |
Operating income (loss) | 28.6 | 44.2 | 92.8 | 98.3 |
Interest expense | (4.1) | (6.1) | (13.8) | (21.6) |
Interest income | 0.3 | 0.2 | 1.3 | 0.8 |
Other expense | (24.6) | (13.8) | (27.3) | (14.4) |
Income (loss) before income taxes | 0.2 | 24.5 | 53 | 63.1 |
Income tax expense | (1.7) | (0.3) | (17.5) | (16.4) |
Net income (loss) | (1.5) | 24.2 | 35.5 | 46.7 |
Comprehensive income | $ 3.7 | $ 36 | $ 44.9 | $ 58.4 |
Basic earnings (loss) per share (in dollars per share) | $ (0.08) | $ 1.17 | $ 1.71 | $ 2.22 |
Diluted earnings (loss) per share (in dollars per share) | (0.08) | 1.16 | 1.71 | 2.20 |
Cash dividends per share (in dollars per share) | $ 0.25 | $ 0.24 | $ 0.75 | $ 0.72 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
OPERATING ACTIVITIES | ||
Net income | $ 35.5 | $ 46.7 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 27.9 | 28.3 |
Amortization | 25.7 | 26.3 |
Deferred income taxes | (4.2) | (4.4) |
Stock-based compensation | 5 | 4.8 |
Other non-cash adjustments | 14.8 | 14.3 |
Change in assets and liabilities, net of effects of acquisitions and divestiture of businesses: | ||
Asbestos insurance receivables | 5.8 | 16.8 |
Accounts receivable, net | 7.2 | (31.3) |
Inventories | (0.6) | (31.7) |
Accounts payable | (26.5) | 6.6 |
Other current assets and liabilities | 45.6 | 96.5 |
Other non-current assets and liabilities | 14.5 | (14.5) |
Net cash provided by operating activities | 150.7 | 158.4 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (23.8) | (45.7) |
Proceeds from sale of business | 3.6 | 0 |
Acquisitions, net of cash acquired | (310.4) | 0 |
Receipts from settlements of derivative contracts | 0 | 9.3 |
Proceeds from sale of property, plant, and equipment | 0.8 | 26.6 |
Other | (2.9) | (2) |
Net cash used in investing activities | (332.7) | (11.8) |
FINANCING ACTIVITIES | ||
Proceeds from debt | 566.9 | 454.9 |
Repayments of debt | (365.1) | (594.4) |
Repurchase of common stock | (15) | (50) |
Dividends paid | (15.7) | (15.3) |
Other | (5) | (6.7) |
Net cash provided by (used in) financing activities | 166.1 | (211.5) |
Effect of exchange rate changes on cash and cash equivalents | (1.6) | (4.5) |
Net decrease in cash and cash equivalents | (17.5) | (69.4) |
Cash and cash equivalents at beginning of period | 129.6 | 189.3 |
Cash and cash equivalents at end of period | 112.1 | 119.9 |
Cash paid (received) during the period for: | ||
Interest, net | 7.9 | 28.1 |
Income taxes, net | 3.1 | (81.7) |
Non-cash investing and financing activities: | ||
Non-cash acquisitions of property, plant, and equipment | $ 1.7 | $ 5 |
CONSOLIDATED BALANCE SHEETS (UN
CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets | ||
Cash and cash equivalents | $ 112.1 | $ 129.6 |
Accounts receivable, net | 287.1 | 286.6 |
Inventories | 225.5 | 233.1 |
Income tax receivable | 38.5 | 49.6 |
Prepaid expenses and other current assets | 34.4 | 33.2 |
Total current assets | 697.6 | 732.1 |
Property, plant and equipment, net | 284.9 | 301.2 |
Goodwill | 485 | 333.7 |
Other intangible assets, net | 494.3 | 297.3 |
Other assets | 107.9 | 51.5 |
Total assets | 2,069.7 | 1,715.8 |
Current liabilities | ||
Current maturities of long-term debt | 0.4 | 2.4 |
Accounts payable | 105.6 | 139.2 |
Accrued expenses | 200.8 | 150.4 |
Total current liabilities | 306.8 | 292 |
Long-term debt | 665.9 | 462.5 |
Deferred taxes | 80.4 | 37.6 |
Other liabilities | 112.2 | 66 |
Total liabilities | 1,165.3 | 858.1 |
Commitments and contingencies | ||
Redeemable non-controlling interest | 28 | 0 |
Shareholders’ equity | ||
Common stock – $.01 par value; 100,000,000 shares authorized; issued, 20,782,637 shares in 2019 and 20,929,218 shares in 2018 | 0.2 | 0.2 |
Additional paid-in capital | 290.5 | 301 |
Retained earnings | 634.6 | 603.3 |
Accumulated other comprehensive loss | (47.6) | (45.5) |
Common stock held in treasury, at cost – 187,245 shares in 2019 and 189,514 shares in 2018 | (1.3) | (1.3) |
Total shareholders’ equity | 876.4 | 857.7 |
Total liabilities and equity | $ 2,069.7 | $ 1,715.8 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
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) | 20,782,637 | 20,929,218 |
Treasury stock, shares (in shares) | 187,245 | 189,514 |
Overview, Basis of Presentation
Overview, Basis of Presentation and Recently Issued Authoritative Accounting Guidance | 9 Months Ended |
Sep. 30, 2019 | |
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; hoses and fittings for the hygienic process industries; bellows and bellow assemblies; pedestals for semiconductor manufacturing; PTFE products; 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 except as disclosed below 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, 2018 was derived from the audited financial statements included in our annual report on Form 10-K/A for the year ended December 31, 2018 . 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, 2018 included within our annual report on Form 10-K/A. 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 2019, we adopted a standard that establishes principles to report transparent and economically neutral information about the assets and liabilities that arise from leases. The standard requires 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 Consolidated Statements of Operations and the Consolidated 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. We adopted the new standard using the allowable option to apply the transition provisions of the new guidance at its adoption date without adjusting the comparative periods presented. We evaluated the impact of applying practical expedients, and upon adoption we elected the package of practical expedients which permits us to not reassess prior conclusions related to contracts containing leases, lease classification, and initial direct costs. Additionally, we elected to not separate lease and non-lease components, we will not recognize an asset for leases with a term of twelve months or less, and we will apply a portfolio approach in determining discount rates. Upon adoption of this standard, we recognized a right-of-use asset and a corresponding lease liability of approximately $30 million for our operating leases. The adoption of the standard did not have a material impact to our Consolidated Statements of Operations or Consolidated Statements of Cash Flows. Additionally, in the first quarter of 2019, we adopted a standard that allows for the reclassification of disproportionate income tax effects ("stranded tax effects") resulting from the Tax Cuts and Jobs Act (the "Tax Act") from accumulated other comprehensive loss to retained earnings. As a result of the Tax Act, we remeasured our deferred taxes related to pensions and other postretirement benefits using the new U.S. federal tax rate. Our adoption of the standard resulted in the reclassification of a net tax benefit of $11.5 million from accumulated other comprehensive loss to opening retained earnings in our Consolidated Balance Sheet. Adoption of the standard had no impact to our Consolidated Statements of Operations or Consolidated Statements of Cash Flows. Recently Issued Authoritative Accounting Guidance In January 2017, a standard was issued to simplify annual and interim goodwill impairment testing for public business entities. Under the standard, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The standard is effective for any interim goodwill impairment tests in fiscal years beginning after December 15, 2019, and is to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The standard is not currently expected to have a significant impact on our consolidated financial statements or disclosures. 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. Based upon our current population of receivables and associated historical credit loss experience, we do not expect that this standard will have a significant impact on our consolidated financial statements. This conclusion could be impacted by any significant future financing arrangements that we may choose to enter with customers. |
Acquisitions and Divestiture
Acquisitions and Divestiture | 9 Months Ended |
Sep. 30, 2018 | |
Acquisitions and Divestitures [Abstract] | |
Acquisitions and Divestiture | Acquisitions and Divestiture Acquisitions On September 25, 2019, we acquired all of the equity securities of LeanTeq Co., Ltd. and its affiliate LeanTeq LLC (collectively referred to as “LeanTeq”). LeanTeq primarily provides refurbishment services for critical components and assemblies used in state-of-the-art semiconductor equipment. This equipment is used to produce the latest and most technologically advanced microchips for smartphones, autonomous vehicles, high-speed wireless connectivity, artificial intelligence, and other leading-edge applications. Founded in 2011 and headquartered in Taoyuan City, Taiwan, LeanTeq has two locations in Taiwan and one in the United States (Silicon Valley). LeanTeq is included as part of our Technetics Group within the Sealing Products segment. The acquisition was paid for with $271.2 million in cash, net of cash acquired, plus rollover equity from two of LeanTeq sellers (the “Sellers”) who were executives of the acquired entity. This rollover equity gives the Sellers approximately a 10% ownership share (the "Rollover Equity") of Lunar Investment LLC (“Lunar”), EnPro’s subsidiary that purchased LeanTeq. Additionally, there were approximately $5.6 million and $6.4 million of acquisition-related costs recorded during the quarter and nine months ended September 30, 2019, respectively, which were expensed during the periods and included in selling, general and administrative expense in the accompanying Consolidated Statements of Operations. On July 2, 2019, we acquired 100% of the stock of The Aseptic Group (comprising Aseptic Process Equipment SAS and Aseptic Services SARL, collectively referred to as “Aseptic”), a privately-held company which distributes, designs and manufactures aseptic fluid transfer products for the pharmaceutical and biopharmaceutical industries. Aseptic, headquartered in Limonest, France, is included as part of our Garlock group of companies within the Sealing Products segment. The business was acquired for $39.2 million , net of cash acquired. The purchase prices of the businesses acquired during 2019 were allocated to the assets acquired and liabilities assumed based on their estimated fair values. The excess of the purchase prices over the identifiable assets acquired less the liabilities assumed was reflected as goodwill which is attributable primarily to the value of the workforces and ongoing operation of the businesses. Goodwill recorded as part of the purchase price allocations was $152.5 million , of which $2.7 million is expected to be tax deductible over a period of 15 years. Identifiable intangible assets acquired as part of the acquisitions were $219.0 million , including $1.1 million of indefinite-lived trade names and $217.9 million of definite-lived intangible assets, including customer relationships, proprietary technology, trade names, favorable leasehold interests and non-competition agreements, with a weighted average amortization period of approximately 16 years. The fair value of the Rollover Equity is estimated as of closing to be $28.0 million . As part of the LeanTeq acquisition, EnPro has the right to buy (the “Call Option”), and the non-controlling interest holders have the right to sell (the “Put Option”) the Rollover Equity as follows: EnPro shall have the right to buy, and the non-controlling interest holders have the right to sell, the Rollover Equity within 90 days following the third anniversary of the closing and payable in two installments as follows (the "Put/Call Price"): • Half of the price payable for the Rollover Equity will be equal to a pro rata portion of a multiple of EBITDA (as defined) generated by LeanTeq during the last twelve months (“LTM”) ending on the closest month end prior to the last month end before the purchase or sale (the "First Measurement Date") less LeanTeq's net debt in excess of cash as of the First Measurement Date (the "First Exercise Price"). The applicable multiple depends on the future LTM EBITDA margin and revenue growth; • The remaining half of the price payable for the Rollover Equity will be equal to an amount that is the higher of the First Exercise Price and a pro rata portion of a multiple of EBITDA generated by LeanTeq during the last twelve months (“LTM”) prior to the first anniversary of the First Measurement Date (the "Second Measurement Date") less LeanTeq’s net debt in excess of cash as of the Second Measurement Date. The applicable multiple depends on the future LTM EBITDA margin and revenue growth. To estimate the fair value of the Put and Call Option, we used a Monte Carlo simulation in an option pricing framework (a special case of the Income Approach). In particular, we simulated the future equity value, revenue, and EBITDA of LeanTeq assuming a correlated Geometric Brownian Motion. For each simulation path, the Put and Call Option payoffs are calculated based on the contractual terms, and then discounted at the term-matched risk-free rate plus, in the case of the Put Option, allowance for counterparty credit risk. Finally, the value of the Put and Call Option is calculated as the average present value over all simulated paths. The model uses our revenue and EBITDA forecasts adjusted for risk to simulate future revenue and EBITDA in a risk-neutral framework. Due to the presence of the put arrangement, the Rollover Equity is presented as redeemable non-controlling interest since redemption is not solely within our control. We initially recognized the Rollover Equity at fair value, inclusive of the put-call provisions. We will adjust the redeemable non-controlling interest when the redemption value exceeds the carrying value with changes recognized as an adjustment to additional paid-in capital. In addition, the Put Option or Call Option may be exercised in the event of certain employment terminations or other events. The Put/Call Price will be reduced 20 percent for certain types of employment terminations. As a result of this option related to employment termination, a portion of the non-controlling interest will be classified as compensation expense for financial reporting purposes. We calculated the value of this compensation (the “Compensation Amount”) using a with-and-without method. In particular, we calculated the value of the Compensation Amount as the difference between the value of the net Put and Call Options with and without the 20 percent discount applied to the First and Second Exercise Prices. Based on this approach we calculated the Compensation Amount to be $6.4 million , as of the valuation date. This amount will be recognized as compensation expense over the term of the Options and is subject to change based on the ultimate redemption value of the Rollover Equity. We continue to evaluate the purchase price allocations of these acquisitions, primarily the value of certain intangible assets, and it may be revised in future periods as these estimates are finalized. The following table represents the preliminary purchase price allocations: (in millions) Accounts receivable $ 9.8 Property, plant and equipment 7.9 Goodwill 152.5 Other intangible assets 219.0 Other assets 17.0 Deferred income taxes (43.6 ) Liabilities assumed (24.2 ) Redeemable non-controlling interest (28.0 ) $ 310.4 Other assets include $5.4 million of indemnification assets which represent the sellers' obligation under the purchase agreements to indemnify us for a portion of their potential contingent liabilities related to certain tax matters. This amount is currently fully included in escrow accounts related to the purchase transactions. If a timely claim is made, the amount of the claim will remain in escrow until the lapse in the statute of limitations or other settlement of the related tax issues based upon an actual assessment from a tax authority. We also recognized contingent liabilities related to these matters of $8.2 million as of the acquisition dates which are included in the liabilities assumed amount. Sales of $2.9 million and pre-tax income of $0.7 million for LeanTeq and Aseptic are included in our Consolidated Statements of Operations for the quarter and nine months ended September 30, 2019. The following pro forma condensed consolidated financial results of operations for the quarters and nine months ended September 30, 2019 and 2018 are presented as if the acquisitions had been completed on January 1, 2018: Quarters Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in millions) Pro forma net sales $ 379.8 $ 397.7 $ 1,149.3 $ 1,177.7 Pro forma net income 1.6 22.5 36.6 36.7 These amounts have been calculated after applying our accounting policies and adjusting the results of LeanTeq and Aseptic to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to property, plant and equipment and intangible assets had been applied as of January 1, 2018 as well as additional interest expense to reflect financing required, together with the consequential tax effects. The supplemental pro forma net income for the quarter and nine months ended September 30, 2019 was adjusted to exclude $5.6 million and $6.7 million , respectively, of pre-tax acquisition-related costs. The supplemental pro forma net income for the nine months ended September 30, 2018 was adjusted to include $6.7 million of these charges. These pro forma financial results have been prepared for comparative purposes only and do not reflect the effect of synergies that would have been expected to result from the integration of these acquisitions. The pro forma information does not purport to be indicative of the results of operations that actually would have resulted had the acquisitions occurred on January 1, 2018, or of future results of the consolidated entities. Divestiture In September 2019 we recorded a $15.2 million pre-tax loss related to the sale of certain assets and certain liabilities of our brake products business unit located in Rome, Georgia and included in our Sealing Product segment. The loss is composed of the loss on the sale of the business, which closed on September 25, 2019, and the loss on the sale of the facility, which is expected to close in the fourth quarter. As a result of the agreement to sell the building, we recorded a $0.6 million loss in other expense on our Consolidated Statements of Operations for the quarter and nine months ending September 30, 2019, ceased depreciation, and recorded the building at the contracted sales price in other current assets on our Consolidated Balance Sheet as of September 30, 2019. The expected closing of the building sale in the fourth quarter of 2019 will not result in a gain or loss. The sale of the business resulted in a $14.6 million loss that is included in other expense on our Consolidated Statements of Operations for the quarter and nine months ended September 30, 2019. The loss is composed of an $11.4 million non-cash loss on the sale of the business and a $3.2 million loss related to contract cancellation costs, severance, and other expenses. The aggregate sales price for the transaction is $7.0 million , of which we received $3.6 million in the third quarter of 2019 at the closing of the sale of the business, and expect to receive $3.0 million at the closing of the sale of the building, and expect to receive the balance of $0.4 million in 2020. The assets, liabilities, and results of operations for the brake products business unit are not significant to our consolidated financial position or result of operations. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contracts with Customers | Revenue from Contracts with Customers Information regarding long-term engine contracts where revenue is recognized over time using an input method is as follows: September 30, December 31, (in millions) Cumulative revenues recognized on uncompleted contracts $ 455.9 $ 452.5 Cumulative billings on uncompleted contracts 438.6 393.9 $ 17.3 $ 58.6 These amounts were included in the accompanying Consolidated Balance Sheets under the following captions: September 30, December 31, (in millions) Accounts receivable, net (contract revenue recognized in excess of billings) $ 57.7 $ 63.9 Accrued expenses (billings in excess of revenue recognized) (40.4 ) (5.3 ) $ 17.3 $ 58.6 The changes in our contract deferred revenue (billings in excess of revenue recognized) for the nine months ended September 30, 2019 are as follows: 2019 Balance at beginning of period $ 5.5 Additional billings in excess of revenue recognized 63.2 Revenue recognized (28.1 ) Balance at end of period $ 40.6 We make deposits and progress payments to certain vendors for long-lead-time manufactured components associated with engine projects. At September 30, 2019 and December 31, 2018 , deposits and progress payments for long-lead-time components in our Power Systems segment totaled $1.9 million and $1.0 million , respectively. These deposits and progress payments are classified in prepaid expenses and other current assets in the accompanying Consolidated Balance Sheets. Assets and liabilities for long-term service contracts recognized over time were immaterial as of September 30, 2019 and December 31, 2018 . As of September 30, 2019 , the aggregate amount of transaction price of remaining performance obligations, or backlog, on a consolidated basis was $404.3 million . Approximately 88% of these obligations are expected to be satisfied within one year . The amount expected to be satisfied beyond September 30, 2020 is mainly attributable to our Power Systems segment and pertains to the contracts discussed above. Remaining performance obligations include those related to the contracts discussed above as well as orders across all of our businesses that we believe to be firm. However, there is no certainty these orders will result in actual sales at the times or in the amounts ordered. In addition, for most of our business, this total is not particularly predictive of future performance because of our short lead times and some seasonality. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
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 in the interim periods, including losses generated in countries where we are projecting annual losses for which a deferred tax asset is not anticipated to be recognized. This estimated annual effective tax rate is affected by the relative proportions of revenue and income before taxes in the jurisdictions in which we operate. Based on the geographical mix of earnings, our global annual effective tax rate typically approximates the blended statutory rates and fluctuates based on the portion of our profits earned in each jurisdiction. The effective tax rates for the quarters ended September 30, 2019 and 2018 were 878.7% and 1.2% , respectively. The high effective tax rate for the three months ended September 30, 2019 is primarily the result of a geographical mix of lower pre-tax income in the U.S. combined with new minimum tax on certain non-U.S. earnings and disproportionately higher pre-tax income in higher foreign tax jurisdictions. Pre-tax income in the U.S. for the third quarter of 2019 was adversely impacted by a loss on divestiture, acquisition costs, and environmental charges. The effective tax rate for the quarter ended September 30, 2018 includes the minimum tax on certain non-U.S. earnings, the favorable impact of discrete items occurring in the quarter resulting from a refinement of the provisional estimate of our transition tax, and the tax benefit associated with the pension annuitization completed in the third quarter of 2018. The effective tax rates for the nine months ended September 30, 2019 and 2018 were 33.0% and 26.0% , respectively. The effective tax rates for the nine months ended September 30, 2019 and 2018 reflect the impact of the reduction in the U.S. federal statutory income tax rate to 21.0% , partially offset by the new minimum tax on certain non-U.S. earnings, and higher tax rates in most foreign jurisdictions. The effective tax rate for the nine months ended September 30, 2018 was also favorably impacted by discrete items occurring as a result from a refinement of the provisional estimate of our transition tax, the tax benefit associated with the pension annuitization, and the tax charge associated with the benefit previously recognized for domestic production activities as a result of interpretive guidance issued during the period by the IRS. In June 2017, the IRS began an examination of our 2014 U.S. federal income tax return. Although this examination is part of a routine and recurring cycle, we cannot predict the final outcome or expected conclusion date of the audit. Various foreign and state tax returns are also currently under examination and some of these exams may conclude within the next twelve months. The final outcomes of these audits are not yet determinable; however, management believes that any assessments that may arise will not have a material effect on our financial results. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Quarters Ended Nine months ended September 30, 2019 2018 2019 2018 (in millions, except per share amounts) Numerator (basic and diluted): Net income (loss) $ (1.5 ) $ 24.2 $ 35.5 $ 46.7 Denominator: Weighted-average shares – basic 20.6 20.7 20.7 21.0 Share-based awards — 0.2 0.1 0.2 Weighted-average shares – diluted 20.6 20.9 20.8 21.2 Earnings (loss) per share: Basic $ (0.08 ) $ 1.17 $ 1.71 $ 2.22 Diluted $ (0.08 ) $ 1.16 $ 1.71 $ 2.20 In the quarter ended September 30, 2019 there was a loss attributable to common shares. There were 0.1 million |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories September 30, December 31, (in millions) Finished products $ 141.7 $ 142.9 Work in process 36.8 33.6 Raw materials and supplies 58.3 67.7 236.8 244.2 Reserve to reduce certain inventories to LIFO basis (11.3 ) (11.1 ) Total inventories $ 225.5 $ 233.1 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. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019 , are as follows: Sealing Products Engineered Products Power Systems Total (in millions) Goodwill as of December 31, 2018 $ 311.3 $ 10.8 $ 11.6 $ 333.7 Acquisitions of businesses 152.5 — — 152.5 Divestiture of business (1.3 ) — — (1.3 ) Foreign currency translation (0.1 ) 0.1 0.1 0.1 Goodwill as of September 30, 2019 $ 462.4 $ 10.9 $ 11.7 $ 485.0 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, 2019 and December 31, 2018 . Identifiable intangible assets are as follows: As of September 30, 2019 As of December 31, 2018 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (in millions) Amortized: Customer relationships $ 472.3 $ 157.9 $ 284.5 $ 150.2 Existing technology 124.5 49.4 112.3 45.1 Trademarks 39.7 23.8 35.3 23.1 Other 34.0 24.1 28.3 23.8 670.5 255.2 460.4 242.2 Indefinite-Lived: Trademarks 79.0 — 79.1 — Total $ 749.5 $ 255.2 $ 539.5 $ 242.2 Amortization for the quarters and nine months ended September 30, 2019 and 2018 were $7.4 million , $7.0 million , $21.4 million and $21.9 million , respectively. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Leases | Leases We regularly enter into operating leases primarily for real estate, equipment, and vehicles. Operating lease arrangements are generally utilized to secure the use of assets if the terms and conditions of the lease or the nature of the asset makes the lease arrangement more favorable than a purchase. Leases with an initial term of 12 months or less are not recorded on the balance sheet. We have elected an accounting policy to combine lease and non-lease components. Our building leases have remaining terms up to twelve years , some of which contain options to renew up to five years , and some of which contain options to terminate. Some leases contain non-lease components, which may include items such as building common area maintenance, building parking, or general service and maintenance provided for leased assets by the lessor. Our vehicle, equipment, and other leases have remaining lease terms up to seven years , some of which contain options to renew or become evergreen leases, with automatic renewing one-month terms, and some of which have options to terminate. Our right of use assets and liabilities related to operating leases as of September 30, 2019 are as follows: Balance Sheet Classification September 30, (in millions) Right-of-use assets Other assets $ 37.8 Current liability Accrued expenses $ 10.0 Long-term liability Other liabilities 28.1 Total liability $ 38.1 Approximately 87% of our operating lease assets and liabilities arise from real estate leases and approximately 13% arise from equipment and vehicle leases. Most of our leases do not provide an implicit rate for calculating the right of use assets and corresponding lease liabilities. Accordingly, we determine the interest rate that we would have to pay to borrow on a collateralized basis over a similar term and amount equal to the lease payments in similar economic environments. We used the incremental borrowing rate at January 1, 2019 for all leases that commenced prior to that date. In the quarter ended September 30, 2019 , we had operating lease costs of $3.0 million and our operating cash flows from operating leases were $3.1 million . Our short-term and variable lease costs were $0.6 million . We entered into additional operating leases, including leases acquired through business acquisitions, that resulted in new right-of-use assets totaling $10.3 million . In the nine months ended September 30, 2019 , we had operating lease costs of $8.9 million and our operating cash flows from operating leases were $9.3 million . Our short-term and variable leases costs were $1.6 million . We entered into additional operating leases, including leases acquired through business acquisitions, that resulted in new right-of-use assets totaling $16.3 million . In the quarter ended September 30, 2019 , we entered into a building lease that we obtain possession of in October 2020. As a result of entering into this lease, no asset or liability has been recognized as of September 30, 2019 . We expect to recognize a new lease asset and liability of approximately $0.7 million in the fourth quarter of 2019. Our weighted-average remaining lease term and weighted average discount rate at September 30, 2019 were 5.7 years and 4.1% , respectively. A maturity analysis of undiscounted operating lease liabilities is shown in the table below: Operating Lease Payments (in millions) 2019 (1) $ 3.2 2020 10.7 2021 8.2 2022 5.7 2023 4.6 Thereafter 11.4 Total lease payments 43.8 Less: interest (5.0 ) Less: future leases (0.7 ) Present value of lease liabilities $ 38.1 (1) Excludes the nine months ended September 30, 2019 The operating lease payments listed in the table above include all current leases and all known future leases that have yet to commence. The payments also include all renewal periods that we are reasonably certain to exercise. We rarely enter into finance leases. Since finance lease amounts and related costs are not significant to our consolidated financial position or results of operations, additional disclosures regarding finance leases are not presented. Future minimum lease payments by year and in the aggregate, under noncancelable operating leases with initial or remaining noncancelable lease terms in excess of one year, consisted of the following at December 31, 2018 (in millions): 2019 $ 11.5 2020 9.0 2021 6.2 2022 4.4 2023 3.4 Thereafter 2.7 Total minimum payments $ 37.2 Net rent expense was $13.5 million for the year ended December 31, 2018 . |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Accrued Expenses September 30, December 31, (in millions) Salaries, wages and employee benefits $ 53.8 $ 59.5 Interest 9.4 4.9 Customer advances 42.2 7.1 Environmental 16.3 16.4 Warranty 4.9 10.9 Income and other taxes 27.9 21.8 Operating lease liabilities 10.0 — Other 36.3 29.8 $ 200.8 $ 150.4 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Revolving Credit Facility On September 25, 2019, we entered into a First Amendment (the "First Amendment") to our Second Amended and Restated Credit Agreement (the "Credit Agreement”) among EnPro Industries, Inc. and EnPro Holdings, Inc., a wholly owned subsidiary of the Company (“EnPro Holdings”), as borrowers, the guarantors party thereto, the lenders party thereto and Bank of America, N.A., as Administrative Agent, Swing Line Lender and Letter of Credit Issuer. The Credit Agreement provides for a five -year, senior secured revolving credit facility of $400.0 million (the “Revolving Credit Facility”) and a five-year, senior secured term loan facility of $150.0 million (the "Term Loan Facility" and, together with the Revolving Credit Facility, the "Facilities"). The Amended Credit Agreement also provides that the borrowers may seek incremental term loans and/or additional revolving credit commitments in an amount equal to the greater of $225.0 million and 100% of consolidated EBITDA (as defined) for the most recently ended four-quarter period for which we have reported financial results, plus additional amounts based on a consolidated senior secured leverage ratio. Initially, borrowings under the Facilities bear interest at an annual rate of LIBOR plus 1.50% or base rate plus 0.50% , although the interest rates under the Facilities are subject to incremental increases based on a consolidated total net leverage ratio. In addition, a commitment fee accrues with respect to the unused amount of the Revolving Credit Facility at an annual rate of 0.175% , which rate is also subject to incremental increase or decrease based on a consolidated total net leverage ratio. The Term Loan Facility will amortize on a quarterly basis in an annual amount equal to 2.50% of the original principal amount of the Term Loan Facility in each of years one through three, 5.00% of such original principal amount in year four, and 1.25% of such original principal amount in each of the first three quarters of year five, with the remaining outstanding principal amount payable at maturity. The Facilities are subject to prepayment with the net cash proceeds of certain asset sales, casualty or condemnation events, and non-permitted debt issuances. The Company and EnPro Holdings are the permitted borrowers under the Revolving Credit Facility. We have the ability to add foreign subsidiaries as borrowers under the Revolving Credit Facility for up to $100.0 million (or its foreign currency equivalent) in aggregate borrowings, subject to certain conditions. Each of our domestic, consolidated subsidiaries are required to guarantee the obligations of the borrowers under the Revolving Credit Facility, and each of our existing domestic, consolidated subsidiaries has entered into the Credit Agreement to provide such a guarantee. Borrowings under the Revolving Credit Facility are secured by a first-priority pledge of certain assets. The Credit Agreement contains certain financial covenants and required financial ratios including a maximum consolidated total net leverage and a minimum consolidated interest coverage as defined in the Credit Agreement. We were in compliance with all covenants of the Credit Agreement as of September 30, 2019 . The borrowing availability under the Credit Agreement at September 30, 2019 was $212.8 million after giving consideration to $17.5 million of outstanding letters of credit, $169.7 million of outstanding Revolving Credit Facility borrowings, and $150.0 million of outstanding Term Loan Facility borrowings. Senior Notes In October 2018, we completed the offering of $350.0 million aggregate principal amount of 5.75% Senior Notes due 2026 (the "Senior Notes"). The Senior Notes are unsecured, unsubordinated obligations of EnPro and mature on October 15, 2026. Interest on the Senior Notes accrues at a rate of 5.75% per annum and is payable semi-annually in cash in arrears on April 15 and October 15 of each year, commencing on April 15, 2019. 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 October 15, 2021, we may, on any one or more occasion, redeem all or 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 October 15, 2021 with the net cash proceeds from certain equity offerings at a specified redemption price plus accrued and unpaid interest, if any, to, but not including, the redemption price. We may also redeem some or all of the Senior Notes before October 15, 2021 at a redemption price of 100% of the principal amount, plus accrued and unpaid interest, if any, but not including, the redemption date, plus a "make whole" premium. Each holder of the Senior Notes may require us to repurchase some or all of the Senior Notes held by such holder 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. |
Pensions and Postretirement Ben
Pensions and Postretirement Benefits | 9 Months Ended |
Sep. 30, 2019 | |
Retirement Benefits [Abstract] | |
Pensions and Postretirement Benefits | Pensions and Postretirement Benefits The components of net periodic benefit cost for our U.S. and foreign defined benefit pension and other postretirement plans for the quarters and nine months ended September 30, 2019 and 2018 , are as follows: Quarters Ended September 30, Nine months ended September 30, Pension Benefits Other Benefits Pension Benefits Other Benefits 2019 2018 2019 2018 2019 2018 2019 2018 (in millions) Service cost $ 1.1 $ 1.2 $ — $ — $ 3.4 $ 3.7 $ 0.1 $ 0.1 Interest cost 3.1 2.9 — — 9.2 9.7 0.1 0.1 Expected return on plan assets (4.0 ) (4.2 ) — — (12.0 ) (14.9 ) — — Amortization of prior service cost — — 0.1 0.1 0.1 0.1 0.1 0.1 Amortization of net loss 1.7 1.1 — — 5.0 4.0 — — Settlement — 12.8 — — 12.8 — Net periodic benefit cost $ 1.9 $ 13.8 $ 0.1 $ 0.1 $ 5.7 $ 15.4 $ 0.3 $ 0.3 Contributions of $20.0 million were made in the nine months ended September 30, 2018 to our U.S. defined benefit pension plans. We do not expect to make any contributions in 2019 . |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders' Equity Changes in shareholders' equity for the nine months ended September 30, 2019 are as follows: Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Treasury Stock Total Permanent Shareholders' Equity Redeemable non-controlling interest (in millions) Shares Amount Balance, December 31, 2018 20.7 $ 0.2 $ 301.0 $ 603.3 $ (45.5 ) $ (1.3 ) $ 857.7 $ — Adoption of new accounting standard — — — 11.5 (11.5 ) — — — Net income — — — 13.1 — — 13.1 — Other comprehensive income — — — — 6.8 — 6.8 — Dividends — — — (5.3 ) — — (5.3 ) — Share repurchases — — (2.4 ) — — — (2.4 ) — Incentive plan activity 0.1 — 1.2 — — — 1.2 — Balance, March 31, 2019 20.8 0.2 299.8 622.6 (50.2 ) (1.3 ) 871.1 — Net income — — — 23.9 — — 23.9 — Other comprehensive loss — — — — (2.6 ) — (2.6 ) — Dividends — — — (5.2 ) — — (5.2 ) — Share repurchases (0.2 ) — (12.6 ) — — — (12.6 ) — Incentive plan activity — — 1.6 — — — 1.6 — Balance, June 30, 2019 20.6 0.2 288.8 641.3 (52.8 ) (1.3 ) 876.2 — LeanTeq acquisition — — — — — — — 28.0 Net loss — — — (1.5 ) — — (1.5 ) — Other comprehensive income — — — — 5.2 — 5.2 — Dividends — — — (5.2 ) — — (5.2 ) — Incentive plan activity — — 1.7 — — — 1.7 — Balance, September 30, 2019 20.6 $ 0.2 $ 290.5 $ 634.6 $ (47.6 ) $ (1.3 ) $ 876.4 $ 28.0 Changes in shareholders' equity for the nine months ended September 30, 2018 are as follows: Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Treasury Stock Total Shareholders' Equity (in millions) Shares Amount Balance, December 31, 2017 21.3 $ 0.2 $ 347.9 $ 604.4 $ (48.4 ) $ (1.3 ) $ 902.8 Adoption of new accounting standard — — — (0.3 ) — — (0.3 ) Net income — — — 12.6 — — 12.6 Other comprehensive income — — — — 9.8 — 9.8 Dividends — — — (5.2 ) — — (5.2 ) Share repurchases (0.2 ) — (16.9 ) — — — (16.9 ) Incentive plan activity 0.1 — (1.7 ) — — — (1.7 ) Balance, March 31, 2018 21.2 0.2 329.3 611.5 (38.6 ) (1.3 ) 901.1 Net income — — — 9.9 — — 9.9 Other comprehensive loss — — — — (9.9 ) — (9.9 ) Dividends — — — (5.1 ) — — (5.1 ) Share repurchases (0.5 ) — (33.0 ) — — — (33.0 ) Incentive plan activity — — 1.7 — — — 1.7 Balance, June 30, 2018 20.7 0.2 298.0 616.3 (48.5 ) (1.3 ) 864.7 Net income — — — 24.2 — — 24.2 Other comprehensive income — — — — 11.8 — 11.8 Dividends — — — (5.0 ) — — (5.0 ) Share repurchases — — (0.1 ) — — — (0.1 ) Incentive plan activity — — 1.2 — — — 1.2 Balance, September 30, 2018 20.7 $ 0.2 $ 299.1 $ 635.5 $ (36.7 ) $ (1.3 ) $ 896.8 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 $15.7 million were made during the nine months ended September 30, 2019 . In October 2019, our board of directors declared a dividend of $0.25 per share, payable on December 18, 2019 to all shareholders of record as of December 4, 2019. In October 2018, 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, 2019 we repurchased 0.2 million shares for $15.0 million . No shares were repurchased during the quarter ended September 30, 2019 . The remaining amount of authorized purchases in the program at September 30, 2019 was $35.0 million . The board of directors' authorization expires in October 2020. |
Business Segment Information
Business Segment Information | 9 Months Ended |
Sep. 30, 2019 | |
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, custom-engineered mechanical seals for applications in the aerospace industry and other markets, 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, fluid transfer products for the pharmaceutical and biopharmaceutical industries. hole forming products, manhole infiltration sealing systems, bellows and bellows assemblies, pedestals for semiconductor manufacturing, PTFE products, and heavy-duty commercial vehicle parts used in the wheel-end, braking, suspension, and tire and mileage optimization systems. In addition to these products, we also provide cleaning and refurbishment services for critical components and assemblies used in state-of-the-art semiconductor equipment. The equipment serviced is used to produce advanced microchips for smartphones, autonomous vehicles, high-speed wireless connectivity, artificial intelligence, and other applications. 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, including parts and services. 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, 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, 2019 and 2018 were as follows: Quarters Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in millions) Sales Sealing Products $ 226.9 $ 249.6 $ 690.7 $ 737.2 Engineered Products 72.9 78.1 231.4 249.4 Power Systems 74.0 61.4 201.1 167.2 373.8 389.1 1,123.2 1,153.8 Intersegment sales (0.8 ) (0.9 ) (2.9 ) (3.2 ) Net sales $ 373.0 $ 388.2 $ 1,120.3 $ 1,150.6 Segment Profit Sealing Products $ 19.4 $ 35.9 $ 69.6 $ 78.9 Engineered Products 9.0 8.4 25.3 34.9 Power Systems 8.9 8.7 24.6 12.5 Total segment profit 37.3 53.0 119.5 126.3 Corporate expenses (7.5 ) (7.6 ) (23.7 ) (24.8 ) Interest expense, net (3.8 ) (5.9 ) (12.5 ) (20.8 ) Other expense, net (25.8 ) (15.0 ) (30.3 ) (17.6 ) Income before income taxes $ 0.2 $ 24.5 $ 53.0 $ 63.1 Segment assets are as follows: September 30, December 31, (in millions) Sealing Products $ 1,379.0 $ 1,009.3 Engineered Products 229.0 220.5 Power Systems 261.9 266.1 Corporate 199.8 219.9 $ 2,069.7 $ 1,715.8 Revenue by End Market Due to the diversified nature of our business and the wide array of products that we offer, we sell into a number of end markets. Underlying economic conditions within these markets are a major driver of our segments' sales performance. Below is a summary of our third party sales by major end market with which we do business for the quarters ended September 30, 2019 and 2018 : Quarter Ended September 30, 2019 (in millions) Sealing Products Engineered Products Power Systems Total Aerospace $ 16.1 $ 3.8 $ — $ 19.9 Automotive 0.5 17.8 — 18.3 Chemical and material processing 14.7 12.2 — 26.9 Food and pharmaceutical 13.0 0.2 — 13.2 General industrial 37.7 23.4 — 61.1 Medium-duty/heavy-duty truck 89.7 0.6 — 90.3 Navy and marine 0.2 — 63.3 63.5 Oil and gas 15.6 7.8 0.6 24.0 Power generation 11.9 2.5 9.9 24.3 Semiconductors 25.5 — — 25.5 Other 1.3 4.5 0.2 6.0 Total third party sales $ 226.2 $ 72.8 $ 74.0 $ 373.0 Quarter Ended September 30, 2018 (in millions) Sealing Products Engineered Products Power Systems Total Aerospace $ 14.3 $ 2.2 $ — $ 16.5 Automotive 1.3 20.7 — 22.0 Chemical and material processing 15.4 12.3 — 27.7 Food and pharmaceutical 9.5 0.2 — 9.7 General industrial 30.4 24.9 — 55.3 Medium-duty/heavy-duty truck 107.6 0.5 — 108.1 Navy and marine 0.3 — 46.7 47.0 Oil and gas 13.9 10.4 3.3 27.6 Power generation 14.1 3.6 10.5 28.2 Semiconductors 31.0 — — 31.0 Other 11.0 3.2 0.9 15.1 Total third party sales $ 248.8 $ 78.0 $ 61.4 $ 388.2 Below is a summary of our third party sales by major end market with which we do business for the nine months ended September 30, 2019 and 2018 : Nine Months Ended September 30, 2019 (in millions) Sealing Products Engineered Products Power Systems Total Aerospace $ 43.0 $ 9.5 $ — $ 52.5 Automotive 2.0 63.6 — 65.6 Chemical and material processing 43.3 37.4 — 80.7 Food and pharmaceutical 32.2 0.5 — 32.7 General industrial 123.6 74.1 — 197.7 Medium-duty/heavy-duty truck 276.7 0.9 — 277.6 Navy and marine 0.6 — 167.0 167.6 Oil and gas 46.6 29.6 3.0 79.2 Power generation 35.2 7.2 30.7 73.1 Semiconductors 78.0 — — 78.0 Other 7.1 8.1 0.4 15.6 Total third party sales $ 688.3 $ 230.9 $ 201.1 $ 1,120.3 Nine Months Ended September 30, 2018 (in millions) Sealing Products Engineered Products Power Systems Total Aerospace $ 39.2 $ 6.5 $ — $ 45.7 Automotive 4.3 76.2 — 80.5 Chemical and material processing 39.6 39.1 — 78.7 Food and pharmaceutical 27.5 0.7 — 28.2 General industrial 125.2 78.0 — 203.2 Medium-duty/heavy-duty truck 302.9 0.8 — 303.7 Navy and marine 0.6 — 118.2 118.8 Oil and gas 41.7 33.6 7.5 82.8 Power generation 46.9 8.9 39.1 94.9 Semiconductors 89.6 — — 89.6 Other 17.0 5.1 2.4 24.5 Total third party sales $ 734.5 $ 248.9 $ 167.2 $ 1,150.6 |
Derivatives and Hedging
Derivatives and Hedging | 9 Months Ended |
Sep. 30, 2019 | |
Summary of Credit Derivatives [Abstract] | |
Derivatives and Hedging | Derivatives and Hedging In September 2018, we entered into cross-currency swap agreements (the "Original Swap") with a notional amount of $200.0 million to manage foreign currency risk by effectively converting a portion of the interest payments related to our fixed-rate U.S. Dollar (“USD”)-denominated Senior Notes, including the semi-annual interest payments thereunder, to interest payments on fixed-rate Euro-denominated debt of 172.8 million EUR with a weighted average interest rate of 2.8% , with interest payment dates of March 15 and September 15 of each year. The Original Swap agreement matures on September 15, 2022. In May 2019, we entered into additional cross-currency swap agreements (the "Additional Swap") with a notional amount of $100.0 million to manage an increased portion of our foreign currency risk by effectively converting a portion of the interest payments related to our fixed-rate USD-denominated Senior Notes, including the semi-annual interest payments thereunder, to interest payments on fixed-rate Euro-denominated debt of 89.6 million EUR with a weighted average interest rate of 3.5% , with interest payment dates of April 15 and October 15 of each year. The Additional Swap agreement matures on October 15, 2026. During the term of the swap agreements, we will receive semi-annual payments from the counterparties due to the difference between the interest rate on the Senior Notes and the interest rate on the Euro debt underlying each of the swaps. There was no principal exchange at the inception of the arrangements, and there will be no exchange at maturity. At maturity (or earlier at our option), we and the counterparties will settle the swap agreements at their fair value in cash based on the aggregate notional amount and the then-applicable currency exchange rate compared to the exchange rate at the time the swap agreements were entered into. We have designated these cross-currency swaps as qualifying hedging instruments and are accounting for them as a net investment hedge. At September 30, 2019 , the combined fair values of the Original Swap and the Additional Swap were recorded as a $17.2 million asset within other assets on the Consolidated Balance Sheet. The gains and losses resulting from fair value adjustments to the cross currency-swap agreements, excluding interest accruals related to the above receipts, are recorded in accumulated other comprehensive loss within our cumulative foreign currency translation adjustment, as the swaps are effective in hedging the designated risk. Cash flows related to the cross-currency swaps are included in operating activities in the Consolidated Statements of Cash Flows, aside from the ultimate settlement at maturity with the counterparties, which will be included in investing activities. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Assets and liabilities measured at fair value on a recurring basis are summarized as follows: Fair Value Measurements as of September 30, 2019 December 31, 2018 (in millions) Assets Time deposits $ 27.4 $ 33.4 Foreign currency derivatives 17.2 4.5 Deferred compensation assets 10.2 8.6 $ 54.8 $ 46.5 Liabilities Deferred compensation liabilities $ 10.5 $ 8.9 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. Our foreign currency derivatives are classified as Level 2 as their value is calculated based upon observable inputs including market USD/Euro exchange rates and market interest rates. 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, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value (in millions) Long-term debt $ 666.3 $ 698.1 $ 464.9 $ 462.1 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 9 Months Ended |
Sep. 30, 2019 | |
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 quarter ended September 30, 2019 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (8.8 ) $ (44.0 ) $ (52.8 ) Other comprehensive income before reclassifications 3.9 — 3.9 Amounts reclassified from accumulated other comprehensive loss — 1.3 1.3 Net current-period other comprehensive income (loss) 3.9 1.3 5.2 Ending balance $ (4.9 ) $ (42.7 ) $ (47.6 ) Changes in accumulated other comprehensive loss by component (after tax) for the quarter ended September 30, 2018 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (9.0 ) $ (39.5 ) $ (48.5 ) Other comprehensive income (loss) before reclassifications 3.0 (2.0 ) 1.0 Amounts reclassified from accumulated other comprehensive loss — 10.8 10.8 Net current-period other comprehensive income 3.0 8.8 11.8 Ending balance $ (6.0 ) $ (30.7 ) $ (36.7 ) Changes in accumulated other comprehensive loss by component (after tax) for the nine months ended September 30, 2019 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (10.6 ) $ (34.9 ) $ (45.5 ) Adoption of new accounting standard — (11.5 ) (11.5 ) Adjusted beginning balance (10.6 ) (46.4 ) (57.0 ) Other comprehensive income before reclassifications 5.7 — 5.7 Amounts reclassified from accumulated other comprehensive loss — 3.7 3.7 Net current-period other comprehensive income 5.7 3.7 9.4 Ending balance $ (4.9 ) $ (42.7 ) $ (47.6 ) Changes in accumulated other comprehensive loss by component (after tax) for the nine months ended September 30, 2018 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (6.8 ) $ (41.6 ) $ (48.4 ) Other comprehensive income (loss) before reclassifications 0.8 (2.0 ) (1.2 ) Amounts reclassified from accumulated other comprehensive loss — 12.9 12.9 Net current-period other comprehensive income 0.8 10.9 11.7 Ending balance $ (6.0 ) $ (30.7 ) $ (36.7 ) Reclassifications out of accumulated other comprehensive loss for the quarters and nine months ended September 30, 2019 and 2018 are as follows: Details about Accumulated Other Comprehensive Loss Components Amount Reclassified from Accumulated Other Affected Statement of Operations Caption Quarters Ended Nine Months Ended (in millions) 2019 2018 2019 2018 Pension and other postretirement plans adjustments: Actuarial losses $ 1.7 $ 1.1 $ 5.0 $ 4.0 (1) Prior service costs 0.1 0.1 0.2 0.2 (1) Settlement loss — 12.8 — 12.8 (1) Total before tax $ 1.8 $ 14.0 $ 5.2 $ 17.0 Income before income taxes Tax benefit (0.5 ) (3.2 ) (1.5 ) (4.1 ) Income tax expense Net of tax $ 1.3 $ 10.8 $ 3.7 $ 12.9 Net income (loss) (1) These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. As these are components of net periodic pension cost other than service cost, the affected Statement of Operations caption is other (non-operating) expense (See Note 11, “Pensions and Postretirement Benefits ” for additional details). |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies General A detailed description of environmental 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 21 sites. At 16 of these sites, the future cost per site for us or our subsidiary is expected to exceed $100,000 . Of these 21 sites, 18 are sites where we or one or more of our subsidiaries formerly conducted business operations but no longer do, and 3 are sites where we conduct manufacturing operations. Investigations have been completed for 16 sites and are in progress at the other 5 sites. Our costs at 14 of the 21 sites relate to remediation projects for soil and/or groundwater contamination at or near former operating facilities that were sold or closed. 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 the remediation of similar 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, 2019 and December 31, 2018 , we had accrued liabilities aggregating $34.6 million and $31.1 million , respectively, for estimated future expenditures relating to environmental contingencies. 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 fully or partially 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 21 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 a predecessor of our EnPro Holdings, Inc. subsidiary (which, including its corporate predecessors is referred to as "EnPro Holdings") when it sold a majority interest in Crucible Materials Corporation (the successor of Crucible) in 1985. The United States Environmental Protection Agency (the “EPA”) notified our subsidiary 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. EnPro Holdings 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. In September 2018, EnPro Holdings withdrew from the Cooperating Parties Group but remains a party to the May 2007 Administrative Order on Consent. The RI/FS was completed and submitted to the EPA at the end of 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. In September 2017, EPA hired a third-party allocator to develop an allocation of costs among a large number of the parties identified by EPA as having potential responsibility, including the Company. On June 30, 2018, Occidental Chemical Corporation sued over 120 parties, including the Company, in the United States District Court for New Jersey seeking recovery of response costs under the Federal Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"). 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. Since 2016, we incurred $0.7 million in costs related to this matter. Our future remediation costs could be significantly greater than the $2.8 million remaining accrual at September 30, 2019 . 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, which is also included in the 21 sites referred to above. 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 us and EnPro Holdings, 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. We have also 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 EnPro Holdings is considered to be a potentially responsible party for natural resource damages 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 us that it has claims against EnPro Holdings 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, including a portion of its costs for the remediation of the Onondaga Site in accordance with its settlement with NYSDEC and EPA. Based on limited information available with respect to estimated remediation costs and the respective allocation of responsibility for remediation among potentially responsible parties, we previously were unable to estimate a reasonably possible range of loss associated with Crucible’s activities that may have affected the Onondaga Site. After continued discussions with Honeywell, an agreement-in-principle has been reached to settle Honeywell's claim for $10 million in exchange for a full release of any and all claims based on Crucible's alleged contamination of Onondaga Lake. In light of this tentative settlement, for the third quarter of 2019, we increased our reserve for this matter by $3.5 million to reflect an aggregate reserve of $10 million . It is anticipated that the settlement will be completed and paid in the first quarter of 2020. 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 and the Onondaga site, 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, EnPro Holdings received a notice from the EPA dated February 19, 2014 asserting that EnPro Holdings is a potentially responsible party under the Comprehensive Environmental Response, Compensation, and Liability Act ("CERCLA") as the successor to a former operator in 1954 and 1955 of two uranium mines in Arizona. On October 15, 2015, EnPro Holdings received another notice from the EPA asserting that it is a potentially responsible party as the successor to the former operator of six additional uranium mines in Arizona. In 2015, we reserved $1.1 million for the minimum amount of probable loss associated with the first two mines identified by the EPA, including the cost of the investigative work to be conducted at such mines. During 2016, we reserved an additional $1.1 million for the minimum amount of probable loss associated with the six additional mines, which includes estimated costs of investigative work to be conducted at the eight mines. We entered into an Administrative Settlement Agreement and Order on Consent for Interim Removal Action with the EPA effective November 7, 2017 for the performance of this work. In the third quarter of 2017, we increased the reserve by $1.9 million to perform investigations required by the Settlement Agreement to determine the nature and extent of contamination at each site with the investigations anticipated to be completed by the end of 2020. In the fourth quarter of 2018, we increased the reserve by $1.0 million for the estimated reimbursement of the EPA's costs to oversee these investigations. The balance in the reserve as of September 30, 2019 is $2.2 million . We cannot at this time estimate a reasonably possible range of loss associated with remediation or other incremental costs related to these mines. In connection with the former operation of a division of EnPro Holdings located in Water Valley, Mississippi, which was divested to BorgWarner, Inc. ("BorgWarner") in 1996, EnPro Holdings has been managing trichloroethylene soil and groundwater contamination at the site. In February 2016, the Mississippi Department of Environmental Quality (MDEQ) issued an order against EnPro Holdings requiring evaluation of potential vapor intrusion into residential properties 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. In April 2016, the parties entered into a new order including negotiated time frames for groundwater remediation. Pursuant to that order, MDEQ performed a second round of vapor intrusion sampling beginning in August 2016. 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. Two separate sampling events at another residence were also below applicable screening levels. Due to an increasing trend in vapor concentrations, MDEQ requested that we develop and implement initial corrective action measures to address vapor intrusion resulting from groundwater contamination in this residential area. These measures were developed and approved by MDEQ. Due to an inability to obtain access to private properties where the corrective action system was to be located, we developed an alternate remedial approach which has been approved by MDEQ. In addition, vapor intrusion sampling at the manufacturing facility owned by BorgWarner was conducted during the first quarter of 2017. The results showed exceedances of screening levels at various areas in the plant and exceedances of levels requiring responsive actions in a limited area of the plant. Implementation of the immediate responsive actions has been completed and corrective action consisting of a permanent vapor intrusion remediation system became operational in May 2017 with further improvements made to the system in December 2017 and January 2018. Indoor air sampling is conducted at four locations biweekly and have been below levels requiring responsive action at three sampling locations since June 2017 and at all four locations since February 2018. We are also continuing soil and groundwater investigation work in the area inside the plant where the vapor intrusion remediation system is located and around the outside of the plant and implementing corrective action plans for both the contamination remaining at the plant as well as contamination that has migrated off-site. All of the work to be performed at the residential area, the plant and off-site is set forth in an agreed Order that we and MDEQ entered into on September 11, 2017. During 2016, we established an additional $1.3 million reserve with respect to this matter. During the year ended December 31, 2017, we reserved an additional $5.7 million for further investigation, additional remediation, long-term monitoring costs, and legal fees to support regulatory compliance for the above noted actions. In the fourth quarter of 2018, we reserved an additional $3.5 million for additional remediation, long-term monitoring costs and legal fees to support regulatory compliance for the above noted activities. As the corrective actions are implemented and their performance monitored, further modifications to the remediation system at the site may be required which may result in additional costs beyond the current reserve. On April 7, 2017, the State of Mississippi through its Attorney General filed suit against EnPro Holdings and Goodrich Corporation (EnPro's former corporate parent), in Mississippi Circuit Court in Yalobusha County seeking recovery of all costs and expenses to be incurred by the State in remediating the groundwater contamination, punitive damages and attorney’s fees. We are aggressively defending this case. The additional reserve established in the year ended December 31, 2017, noted above, does not include any estimate of contingent loss associated with this lawsuit other than due to remediation and other actions with respect to this site based on existing MDEQ orders described above. On January 31, 2019, some of these property owners (representing ownership of 27 residential, agricultural or commercial properties), Yalobusha County, and the Board of Trustees of the Yalobusha General Hospital filed suit against EnPro and Goodrich in Mississippi Circuit Court and Yalobusha County seeking recovery for alleged damage to their properties, including diminution in value, from groundwater contamination that has come onto their properties. These cases have been removed to the federal U.S. District Court and plaintiffs' challenge to such removal has been denied by the federal court. In addition, it is our understanding that other area homeowners, owners of commercial facilities and possibly other private parties and individuals may be separately evaluating possible legal action relating to potential vapor intrusion and groundwater contamination. In October 2019, mediation of the case filed by the property owners (representing ownership of the 27 residential, agricultural and commercial properties) was conducted. As a result of that mediation, the claims of all of the property owners were settled for current and estimated future payments of $3.0 million in the aggregate. In exchange for these payments, the litigation is to be dismissed with prejudice, each plaintiff will release any and all claims that were or could have been brought against EnPro, and each property owner will file in the real property records of Yalobusha County, Mississippi, a deed restriction required by MDEQ as part of EnPro's required remediation. Mediation of the lawsuit brought by Yalobusha County and the Board of Trustees of the Yalobusha County General Hospital is scheduled to be held in December 2019. In light of this settlement and the upcoming mediation, for the third quarter of 2019, we further increased our reserve for this matter, including the remediation matters described above, by $4.4 million to reflect an aggregate reserve of $7.5 million . Beyond this increase, we cannot estimate a reasonably possible range of loss from the remaining lawsuits or any potential additional legal actions at this time. Based upon limited information regarding any incremental remediation or other actions that may be required at the site, we cannot estimate a minimum loss or a reasonably possible range of loss related to this matter. 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 EnPro Holdings until 1983 when its assets and liabilities were distributed to a new subsidiary, Crucible Materials Corporation. EnPro Holdings 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 and is no longer conducting operations. 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, in addition to those mentioned previously related to EnPro Holding's period of ownership of Crucible. Based on EnPro Holding'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, historical experience, and trends result in changes to our estimate. Changes in the product warranty liability for the nine months ended September 30, 2019 and 2018 are as follows: 2019 2018 (in millions) Balance at beginning of year $ 11.7 $ 5.3 Net charges to expense 6.7 5.8 Settlements made (4.7 ) (2.3 ) Balance at end of period $ 13.7 $ 8.8 BorgWarner A subsidiary of BorgWarner has asserted claims against our subsidiary, GGB France E.U.R.L. (“GGB France”), regarding certain bearings supplied by GGB France to BorgWarner and used by BorgWarner in manufacturing hydraulic control units included in motor vehicle automatic transmission units, mainly that the bearings caused performance problems with and/or damage to the transmission units, leading to associated repairs and replacements. BorgWarner and GGB France participated 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 was a required predicate to the commencement of a legal proceeding for damages. The expert panel issued a final report on technical and financial matters on April 6, 2017. In the final report, the expert panel concluded that GGB France had a duty to notify BorgWarner regarding the change of source of raw material used in the bearings, but that the failure of the hydraulic control units was attributable to both the raw material supplier change and the insufficient design of the units by BorgWarner. The expert panel provided detail on a possible allocation of damages alleged to have been incurred by BorgWarner and its customer. Although the language of the report is not clear, the report appears to note a potential allocation of recoverable damages 65% to GGB and 35% to BorgWarner. It also indicates that, though it is for a court to ultimately determine, the aggregate damages to BorgWarner and its customer was in the range of 7.9 million EUR to 10.2 million EUR, with 1.8 million EUR to 2.1 million EUR of this range being for damages to BorgWarner and the remainder being for damages to its customer. The experts noted the lower end of the range as being more likely and noted a lack of sufficient evidence provided substantiating the customer's damages. Applying a 65% liability allocation to GGB to the total aggregate range yields a range of 5.1 million EUR to 6.6 million EUR. In the final report, the expert panel deferred to a court the determination of whether GGB France had breached its contractual obligations to BorgWarner. On October 25, 2017, BorgWarner initiated a legal proceeding against GGB with respect to this matter by filing a writ of claim with the Commercial Court of Brive, France. The parties have begun briefing their legal positions, and we expect court hearings to begin in late 2019 and a court ruling in early 2020. We continue to 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 are a contractual disclaimer of consequential damages, which, if controlling, would limit liability for consequential damages and provide for the replacement of the bearings at issue, at an aggregate replacement value we estimate to be approximately 0.4 million EUR; that the determination of any duty to notify of the change in the source of the raw material is a legal matter to be determined by the presiding court; and the insufficiency of evidence of damage to BorgWarner's customer provided to the expert panel. Based on the final report from the expert panel and GGB France's legal defenses described above, we estimate GGB France’s reasonably possible range of loss associated with this matter to be approximately 0.4 million EUR to 6.6 million EUR plus a potential undetermined amount of apportioned proceeding expenses, with no amount within the range being a better estimate than the minimum of the range. Accordingly, GGB France has retained the accrual of 0.4 million EUR associated with this matter, which was established in 2016. Asbestos Insurance Matters The historical business operations of certain of our subsidiaries 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 2010, certain of these subsidiaries, including Garlock Sealing Technologies, LLC ("GST"), filed voluntary petitions for reorganization under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the Western District of North Carolina (the "Bankruptcy Court"). An additional subsidiary filed a Chapter 11 bankruptcy petition with the Bankruptcy Court in 2017. The filings were part of a claims resolution process for an efficient and permanent resolution of all pending and future asbestos claims through court approval of a plan of reorganization to establish a facility to resolve and pay these asbestos claims. These claims against GST and other subsidiaries were resolved pursuant to a joint plan of reorganization (the "Joint Plan") filed with the Bankruptcy Court which was consummated on July 29, 2017. Under the Joint Plan, GST and EnPro Holdings retained their rights to seek reimbursement under insurance policies for any amounts they have paid in the past to resolve asbestos claims, including contributions made to the asbestos claims resolution trust established under the Joint Plan (the "Trust"). These policies include a number of primary and excess general liability insurance policies that were purchased by EnPro Holdings and were in effect prior to January 1, 1976 (the “Pre-Garlock Coverage Block”). The policies provide coverage for “occurrences” happening during the policy periods and cover losses associated with product liability claims against EnPro Holdings and certain of its subsidiaries. Asbestos claims against GST are not covered under these policies because GST was not a subsidiary of EnPro Holdings prior to 1976. The Joint Plan provides that EnPro Holdings may retain the first $25 million of any settlements and judgments collected for non-GST asbestos claims related to insurance policies in the Pre-Garlock Coverage Block and EnPro Holdings and the Trust will share equally in any settlements and judgments EnPro Holdings may collect in excess of $25 million . To date, EnPro Holdings has collected almost $22 million in settlements for non-GST asbestos claims from the Pre-Garlock Coverage Block and anticipates further collections once the Trust begins making claims payments. As of September 30, 2019 , approximately $6.7 million of available products hazard limits or insurance receivables existed under primary and excess general liability insurance policies other than the Pre-Garlock Coverage Block (the "Garlock Coverage Block") from solvent carriers with investment grade ratings, which we believe is available to cover GST asbestos claims payments and certain expense payments, including contributions to the Trust. We consider such amount of available insurance coverage under the Garlock Coverage Block 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. The remaining $6.7 million is available to pending and estimated future claims. There are specific agreements in place with carriers regarding 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 $6.7 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. Assuming the insurers pay according to the agreements and policies, we anticipate that $4.2 million will be collected in the fourth quarter of 2019 and $2.5 million will be collected in 2020. We also believe that EnPro Holdings will bill, and could collect over time, as much as $10 million of insurance coverage for non-GST asbestos claims to reimburse it for Trust payments to non-GST Trust claimants. After EnPro Holdings collects the first approximately $3 million of that coverage, remaining collections for non-GST asbestos claims from the Pre-Garlock Coverage Block will be shared equally with the Trust. GST has received $8.8 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 $6.7 million of anticipated collections. The insurance available to cover current and future asbestos claims is from comprehensive general liability policies that cover EnPro Holdings and certain of its other subsidiaries in addition to GST for periods prior to 1985 and therefore could be subject to potential competing claims of other covered subsidiaries and their assignees. |
Supplemental Guarantor Financia
Supplemental Guarantor Financial Information | 9 Months Ended |
Sep. 30, 2019 | |
Condensed Financial Information Disclosure [Abstract] | |
Supplemental Guarantor Financial Information | Supplemental Guarantor Financial Information 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. ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended September 30, 2019 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 266.3 $ 143.4 $ (36.7 ) $ 373.0 Cost of sales — 197.7 97.0 (36.7 ) 258.0 Gross profit — 68.6 46.4 — 115.0 Operating expenses: Selling, general and administrative 11.5 45.1 27.5 — 84.1 Other — 1.4 0.9 — 2.3 Total operating expenses 11.5 46.5 28.4 — 86.4 Operating income (loss) (11.5 ) 22.1 18.0 — 28.6 Interest income (expense), net (3.0 ) (1.0 ) 0.2 — (3.8 ) Other expense — (24.5 ) (0.1 ) — (24.6 ) Income (loss) before income taxes (14.5 ) (3.4 ) 18.1 — 0.2 Income tax benefit (expense) — 4.3 (6.0 ) — (1.7 ) Income (loss) before equity in earnings of subsidiaries (14.5 ) 0.9 12.1 — (1.5 ) Equity in earnings of subsidiaries, net of tax 13.0 12.1 — (25.1 ) — Net income (loss) $ (1.5 ) $ 13.0 $ 12.1 $ (25.1 ) $ (1.5 ) Comprehensive income $ 3.7 $ 8.0 $ 5.8 $ (13.8 ) $ 3.7 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended September 30, 2018 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 279.3 $ 153.2 $ (44.3 ) $ 388.2 Cost of sales — 203.6 104.8 (44.3 ) 264.1 Gross profit — 75.7 48.4 — 124.1 Operating expenses: Selling, general and administrative 11.3 39.1 28.5 — 78.9 Other (0.1 ) 0.8 0.3 — 1.0 Total operating expenses 11.2 39.9 28.8 — 79.9 Operating income (loss) (11.2 ) 35.8 19.6 — 44.2 Interest income (expense), net (5.4 ) (0.6 ) 0.1 — (5.9 ) Other expense — (13.7 ) (0.1 ) — (13.8 ) Income (loss) before income taxes (16.6 ) 21.5 19.6 — 24.5 Income tax benefit (expense) 2.6 2.2 (5.1 ) — (0.3 ) Income (loss) before equity in earnings of subsidiaries (14.0 ) 23.7 14.5 — 24.2 Equity in earnings of subsidiaries, net of tax 38.2 14.5 — (52.7 ) — Net income $ 24.2 $ 38.2 $ 14.5 $ (52.7 ) $ 24.2 Comprehensive income $ 36.0 $ 51.7 $ 19.2 $ (70.9 ) $ 36.0 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2019 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 799.8 $ 440.2 $ (119.7 ) $ 1,120.3 Cost of sales — 587.4 299.4 (119.7 ) 767.1 Gross profit — 212.4 140.8 — 353.2 Operating expenses: Selling, general and administrative 35.7 134.3 85.7 — 255.7 Other 0.4 2.0 2.3 — 4.7 Total operating expenses 36.1 136.3 88.0 — 260.4 Operating income (loss) (36.1 ) 76.1 52.8 — 92.8 Interest income (expense), net (9.4 ) (3.9 ) 0.8 — (12.5 ) Other expense — (27.1 ) (0.2 ) — (27.3 ) Income (loss) before income taxes (45.5 ) 45.1 53.4 — 53.0 Income tax benefit (expense) 3.8 (4.1 ) (17.2 ) — (17.5 ) Income (loss) before equity in earnings of subsidiaries (41.7 ) 41.0 36.2 — 35.5 Equity in earnings of subsidiaries, net of tax 77.2 36.2 — (113.4 ) — Net income $ 35.5 $ 77.2 $ 36.2 $ (113.4 ) $ 35.5 Comprehensive income $ 44.9 $ 73.2 $ 32.6 $ (105.8 ) $ 44.9 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2018 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 810.9 $ 465.0 $ (125.3 ) $ 1,150.6 Cost of sales — 603.4 307.5 (125.3 ) 785.6 Gross profit — 207.5 157.5 — 365.0 Operating expenses: Selling, general and administrative 34.7 134.7 91.0 — 260.4 Other — 5.5 0.8 — 6.3 Total operating expenses 34.7 140.2 91.8 — 266.7 Operating income (loss) (34.7 ) 67.3 65.7 — 98.3 Interest income (expense), net (17.6 ) (3.7 ) 0.5 — (20.8 ) Other expense — (14.1 ) (0.3 ) — (14.4 ) Income (loss) before income taxes (52.3 ) 49.5 65.9 — 63.1 Income tax benefit (expense) 10.2 (8.0 ) (18.6 ) — (16.4 ) Income (loss) before equity in earnings of subsidiaries (42.1 ) 41.5 47.3 — 46.7 Equity in earnings of subsidiaries, net of tax 88.8 47.3 — (136.1 ) — Net income $ 46.7 $ 88.8 $ 47.3 $ (136.1 ) $ 46.7 Comprehensive income $ 58.4 $ 96.2 $ 43.8 $ (140.0 ) $ 58.4 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2019 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated NET CASH PROVIDED BY OPERATING ACTIVITIES $ 83.1 $ 30.2 $ 55.9 $ (18.5 ) $ 150.7 INVESTING ACTIVITIES Purchases of property, plant and equipment — (17.0 ) (6.8 ) — (23.8 ) Proceeds from sale of business — 3.6 — — 3.6 Acquisitions, net of cash acquired — (271.2 ) (39.2 ) — (310.4 ) Proceeds from sale of property, plant, and equipment 0.4 0.4 — 0.8 Other — (2.6 ) (0.3 ) — (2.9 ) Net cash used in investing activities — (286.8 ) (45.9 ) — (332.7 ) FINANCING ACTIVITIES Net payments on loans between subsidiaries (47.4 ) 52.5 (5.1 ) — — Intercompany dividends — — (18.5 ) 18.5 Proceeds from debt — 566.9 — — 566.9 Repayments of debt — (365.1 ) — — (365.1 ) Repurchase of common stock (15.0 ) — (15.0 ) Dividends paid (15.7 ) — (15.7 ) Other (5.0 ) — — — (5.0 ) Net cash provided by (used in) financing activities (83.1 ) 254.3 (23.6 ) 18.5 166.1 Effect of exchange rate changes on cash and cash equivalents — — (1.6 ) — (1.6 ) Net decrease in cash and cash equivalents — (2.3 ) (15.2 ) — (17.5 ) Cash and cash equivalents at beginning of period — 2.3 127.3 — 129.6 Cash and cash equivalents at end of period $ — $ — $ 112.1 $ — $ 112.1 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2018 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated NET CASH PROVIDED BY OPERATING ACTIVITIES $ 69.5 $ 145.6 $ 57.6 $ (114.3 ) $ 158.4 INVESTING ACTIVITIES Purchases of property, plant and equipment — (37.5 ) (8.2 ) — (45.7 ) Receipts from derivative contracts 9.3 — — — 9.3 Proceeds from sale of property, plant and equipment — 26.0 0.6 — 26.6 Other — (1.8 ) (0.2 ) — (2.0 ) Net cash provided by (used in) investing activities 9.3 (13.3 ) (7.8 ) — (11.8 ) FINANCING ACTIVITIES Net payments on loans between subsidiaries (8.0 ) 8.4 (0.4 ) — — Intercompany dividends — — (114.3 ) 114.3 — Proceeds from debt — 454.9 — — 454.9 Repayments of debt — (594.4 ) — — (594.4 ) Repurchase of common stock (50.0 ) — — — (50.0 ) Dividends paid (15.3 ) — — — (15.3 ) Other (5.5 ) (1.2 ) — — (6.7 ) Net cash used in financing activities (78.8 ) (132.3 ) (114.7 ) 114.3 (211.5 ) Effect of exchange rate changes on cash and cash equivalents — — (4.5 ) — (4.5 ) Net decrease in cash and cash equivalents — — (69.4 ) — (69.4 ) Cash and cash equivalents at beginning of period — — 189.3 — 189.3 Cash and cash equivalents at end of period $ — $ — $ 119.9 $ — $ 119.9 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING BALANCE SHEETS (UNAUDITED) As of September 30, 2019 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets Cash and cash equivalents $ — $ — $ 112.1 $ — $ 112.1 Accounts receivable, net 0.2 200.3 86.6 — 287.1 Intercompany receivables — 16.8 11.4 (28.2 ) — Inventories — 153.3 72.2 — 225.5 Income tax receivable 27.3 0.3 10.9 — 38.5 Prepaid expenses and other current assets 5.7 22.1 6.6 — 34.4 Total current assets 33.2 392.8 299.8 (28.2 ) 697.6 Property, plant and equipment, net — 195.6 89.3 — 284.9 Goodwill — 291.1 193.9 — 485.0 Other intangible assets, net — 232.7 261.6 — 494.3 Intercompany receivables — 2.8 5.1 (7.9 ) — Investment in subsidiaries 1,218.7 665.4 — (1,884.1 ) — Other assets 31.9 39.6 36.4 — 107.9 Total assets $ 1,283.8 $ 1,820.0 $ 886.1 $ (1,920.2 ) $ 2,069.7 LIABILITIES AND EQUITY Current liabilities Current maturities of long-term debt $ — $ 0.4 $ — $ — $ 0.4 Accounts payable 2.0 71.4 32.2 — 105.6 Intercompany payables — 11.4 16.8 (28.2 ) — Accrued expenses 20.5 112.9 67.4 — 200.8 Total current liabilities 22.5 196.1 116.4 (28.2 ) 306.8 Long-term debt 345.2 320.4 0.3 — 665.9 Intercompany payables 3.7 1.4 2.8 (7.9 ) — Other liabilities 36.0 55.4 101.2 — 192.6 Total liabilities 407.4 573.3 220.7 (36.1 ) 1,165.3 Redeemable non-controlling interest — 28.0 — — 28.0 Shareholders’ equity 876.4 1,218.7 665.4 (1,884.1 ) 876.4 Total liabilities and equity $ 1,283.8 $ 1,820.0 $ 886.1 $ (1,920.2 ) $ 2,069.7 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING BALANCE SHEETS (UNAUDITED) As of December 31, 2018 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets Cash and cash equivalents $ — $ 2.3 $ 127.3 $ — $ 129.6 Accounts receivable, net — 210.3 76.3 — 286.6 Intercompany receivables — 19.0 8.9 (27.9 ) — Inventories — 155.3 77.8 — 233.1 Income tax receivable 42.9 0.3 6.4 — 49.6 Prepaid expenses and other current assets 4.9 20.3 8.0 — 33.2 Total current assets 47.8 407.5 304.7 (27.9 ) 732.1 Property, plant and equipment, net 2.2 209.7 89.3 — 301.2 Goodwill — 261.0 72.7 — 333.7 Other intangible assets, net — 242.2 55.1 — 297.3 Intercompany receivables — 53.9 — (53.9 ) — Investment in subsidiaries 1,246.4 387.7 — (1,634.1 ) — Other assets 13.6 25.3 12.6 — 51.5 Total assets $ 1,310.0 $ 1,587.3 $ 534.4 $ (1,715.9 ) $ 1,715.8 LIABILITIES AND EQUITY Current liabilities Current maturities of long-term debt $ 2.1 $ 0.3 $ — $ — $ 2.4 Accounts payable 2.1 99.0 38.1 — 139.2 Intercompany payables — 8.9 19.0 (27.9 ) — Accrued expenses 13.9 82.8 53.7 — 150.4 Total current liabilities 18.1 191.0 110.8 (27.9 ) 292.0 Long-term debt 345.0 117.5 — — 462.5 Intercompany payables 51.1 — 2.8 (53.9 ) — Other liabilities 38.1 32.4 33.1 — 103.6 Total liabilities 452.3 340.9 146.7 (81.8 ) 858.1 Shareholders’ equity 857.7 1,246.4 387.7 (1,634.1 ) 857.7 Total liabilities and equity $ 1,310.0 $ 1,587.3 $ 534.4 $ (1,715.9 ) $ 1,715.8 |
Overview, Basis of Presentati_2
Overview, Basis of Presentation and Recently Issued Authoritative Accounting Guidance (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | 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 except as disclosed below 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, 2018 was derived from the audited financial statements included in our annual report on Form 10-K/A for the year ended December 31, 2018 . 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, 2018 included within our annual report on Form 10-K/A. 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 2019, we adopted a standard that establishes principles to report transparent and economically neutral information about the assets and liabilities that arise from leases. The standard requires 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 Consolidated Statements of Operations and the Consolidated 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. We adopted the new standard using the allowable option to apply the transition provisions of the new guidance at its adoption date without adjusting the comparative periods presented. We evaluated the impact of applying practical expedients, and upon adoption we elected the package of practical expedients which permits us to not reassess prior conclusions related to contracts containing leases, lease classification, and initial direct costs. Additionally, we elected to not separate lease and non-lease components, we will not recognize an asset for leases with a term of twelve months or less, and we will apply a portfolio approach in determining discount rates. Upon adoption of this standard, we recognized a right-of-use asset and a corresponding lease liability of approximately $30 million for our operating leases. The adoption of the standard did not have a material impact to our Consolidated Statements of Operations or Consolidated Statements of Cash Flows. Additionally, in the first quarter of 2019, we adopted a standard that allows for the reclassification of disproportionate income tax effects ("stranded tax effects") resulting from the Tax Cuts and Jobs Act (the "Tax Act") from accumulated other comprehensive loss to retained earnings. As a result of the Tax Act, we remeasured our deferred taxes related to pensions and other postretirement benefits using the new U.S. federal tax rate. Our adoption of the standard resulted in the reclassification of a net tax benefit of $11.5 million from accumulated other comprehensive loss to opening retained earnings in our Consolidated Balance Sheet. Adoption of the standard had no impact to our Consolidated Statements of Operations or Consolidated Statements of Cash Flows. |
Recently Issued Authoritative Accounting Guidance | Recently Issued Authoritative Accounting Guidance In January 2017, a standard was issued to simplify annual and interim goodwill impairment testing for public business entities. Under the standard, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. An entity still has the option to perform the qualitative assessment for a reporting unit to determine if the quantitative impairment test is necessary. The standard is effective for any interim goodwill impairment tests in fiscal years beginning after December 15, 2019, and is to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The standard is not currently expected to have a significant impact on our consolidated financial statements or disclosures. 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. Based upon our current population of receivables and associated historical credit loss experience, we do not expect that this standard will have a significant impact on our consolidated financial statements. This conclusion could be impacted by any significant future financing arrangements that we may choose to enter with customers. |
Revenue from Contracts with C_2
Revenue from Contracts with Customers (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Information Regarding Contracts Accounted for Under Percentage-of-Completion Method | Information regarding long-term engine contracts where revenue is recognized over time using an input method is as follows: September 30, December 31, (in millions) Cumulative revenues recognized on uncompleted contracts $ 455.9 $ 452.5 Cumulative billings on uncompleted contracts 438.6 393.9 $ 17.3 $ 58.6 |
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 (contract revenue recognized in excess of billings) $ 57.7 $ 63.9 Accrued expenses (billings in excess of revenue recognized) (40.4 ) (5.3 ) $ 17.3 $ 58.6 |
Contract Deferred Revenue | The changes in our contract deferred revenue (billings in excess of revenue recognized) for the nine months ended September 30, 2019 are as follows: 2019 Balance at beginning of period $ 5.5 Additional billings in excess of revenue recognized 63.2 Revenue recognized (28.1 ) Balance at end of period $ 40.6 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Earnings Per Share | Quarters Ended Nine months ended September 30, 2019 2018 2019 2018 (in millions, except per share amounts) Numerator (basic and diluted): Net income (loss) $ (1.5 ) $ 24.2 $ 35.5 $ 46.7 Denominator: Weighted-average shares – basic 20.6 20.7 20.7 21.0 Share-based awards — 0.2 0.1 0.2 Weighted-average shares – diluted 20.6 20.9 20.8 21.2 Earnings (loss) per share: Basic $ (0.08 ) $ 1.17 $ 1.71 $ 2.22 Diluted $ (0.08 ) $ 1.16 $ 1.71 $ 2.20 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | September 30, December 31, (in millions) Finished products $ 141.7 $ 142.9 Work in process 36.8 33.6 Raw materials and supplies 58.3 67.7 236.8 244.2 Reserve to reduce certain inventories to LIFO basis (11.3 ) (11.1 ) Total inventories $ 225.5 $ 233.1 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019 , are as follows: Sealing Products Engineered Products Power Systems Total (in millions) Goodwill as of December 31, 2018 $ 311.3 $ 10.8 $ 11.6 $ 333.7 Acquisitions of businesses 152.5 — — 152.5 Divestiture of business (1.3 ) — — (1.3 ) Foreign currency translation (0.1 ) 0.1 0.1 0.1 Goodwill as of September 30, 2019 $ 462.4 $ 10.9 $ 11.7 $ 485.0 |
Schedule of Identifiable Intangible Assets | Identifiable intangible assets are as follows: As of September 30, 2019 As of December 31, 2018 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization (in millions) Amortized: Customer relationships $ 472.3 $ 157.9 $ 284.5 $ 150.2 Existing technology 124.5 49.4 112.3 45.1 Trademarks 39.7 23.8 35.3 23.1 Other 34.0 24.1 28.3 23.8 670.5 255.2 460.4 242.2 Indefinite-Lived: Trademarks 79.0 — 79.1 — Total $ 749.5 $ 255.2 $ 539.5 $ 242.2 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases [Abstract] | |
Right of Use Assets and Liabilities | Our right of use assets and liabilities related to operating leases as of September 30, 2019 are as follows: Balance Sheet Classification September 30, (in millions) Right-of-use assets Other assets $ 37.8 Current liability Accrued expenses $ 10.0 Long-term liability Other liabilities 28.1 Total liability $ 38.1 |
Weighted-average Remaining Lease Term and Discount Rate | Our weighted-average remaining lease term and weighted average discount rate at September 30, 2019 were 5.7 years and 4.1% , respectively. |
Maturities of Operating Lease Liabilities | A maturity analysis of undiscounted operating lease liabilities is shown in the table below: Operating Lease Payments (in millions) 2019 (1) $ 3.2 2020 10.7 2021 8.2 2022 5.7 2023 4.6 Thereafter 11.4 Total lease payments 43.8 Less: interest (5.0 ) Less: future leases (0.7 ) Present value of lease liabilities $ 38.1 (1) Excludes the nine months ended September 30, 2019 |
Future Minimum Lease Payments | Future minimum lease payments by year and in the aggregate, under noncancelable operating leases with initial or remaining noncancelable lease terms in excess of one year, consisted of the following at December 31, 2018 (in millions): 2019 $ 11.5 2020 9.0 2021 6.2 2022 4.4 2023 3.4 Thereafter 2.7 Total minimum payments $ 37.2 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Expenses | September 30, December 31, (in millions) Salaries, wages and employee benefits $ 53.8 $ 59.5 Interest 9.4 4.9 Customer advances 42.2 7.1 Environmental 16.3 16.4 Warranty 4.9 10.9 Income and other taxes 27.9 21.8 Operating lease liabilities 10.0 — Other 36.3 29.8 $ 200.8 $ 150.4 |
Pensions and Postretirement B_2
Pensions and Postretirement Benefits (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Retirement Benefits [Abstract] | |
Schedule of Net Periodic Benefit Cost | The components of net periodic benefit cost for our U.S. and foreign defined benefit pension and other postretirement plans for the quarters and nine months ended September 30, 2019 and 2018 , are as follows: Quarters Ended September 30, Nine months ended September 30, Pension Benefits Other Benefits Pension Benefits Other Benefits 2019 2018 2019 2018 2019 2018 2019 2018 (in millions) Service cost $ 1.1 $ 1.2 $ — $ — $ 3.4 $ 3.7 $ 0.1 $ 0.1 Interest cost 3.1 2.9 — — 9.2 9.7 0.1 0.1 Expected return on plan assets (4.0 ) (4.2 ) — — (12.0 ) (14.9 ) — — Amortization of prior service cost — — 0.1 0.1 0.1 0.1 0.1 0.1 Amortization of net loss 1.7 1.1 — — 5.0 4.0 — — Settlement — 12.8 — — 12.8 — Net periodic benefit cost $ 1.9 $ 13.8 $ 0.1 $ 0.1 $ 5.7 $ 15.4 $ 0.3 $ 0.3 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Schedule of Stockholders Equity | Changes in shareholders' equity for the nine months ended September 30, 2019 are as follows: Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Treasury Stock Total Permanent Shareholders' Equity Redeemable non-controlling interest (in millions) Shares Amount Balance, December 31, 2018 20.7 $ 0.2 $ 301.0 $ 603.3 $ (45.5 ) $ (1.3 ) $ 857.7 $ — Adoption of new accounting standard — — — 11.5 (11.5 ) — — — Net income — — — 13.1 — — 13.1 — Other comprehensive income — — — — 6.8 — 6.8 — Dividends — — — (5.3 ) — — (5.3 ) — Share repurchases — — (2.4 ) — — — (2.4 ) — Incentive plan activity 0.1 — 1.2 — — — 1.2 — Balance, March 31, 2019 20.8 0.2 299.8 622.6 (50.2 ) (1.3 ) 871.1 — Net income — — — 23.9 — — 23.9 — Other comprehensive loss — — — — (2.6 ) — (2.6 ) — Dividends — — — (5.2 ) — — (5.2 ) — Share repurchases (0.2 ) — (12.6 ) — — — (12.6 ) — Incentive plan activity — — 1.6 — — — 1.6 — Balance, June 30, 2019 20.6 0.2 288.8 641.3 (52.8 ) (1.3 ) 876.2 — LeanTeq acquisition — — — — — — — 28.0 Net loss — — — (1.5 ) — — (1.5 ) — Other comprehensive income — — — — 5.2 — 5.2 — Dividends — — — (5.2 ) — — (5.2 ) — Incentive plan activity — — 1.7 — — — 1.7 — Balance, September 30, 2019 20.6 $ 0.2 $ 290.5 $ 634.6 $ (47.6 ) $ (1.3 ) $ 876.4 $ 28.0 Changes in shareholders' equity for the nine months ended September 30, 2018 are as follows: Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Treasury Stock Total Shareholders' Equity (in millions) Shares Amount Balance, December 31, 2017 21.3 $ 0.2 $ 347.9 $ 604.4 $ (48.4 ) $ (1.3 ) $ 902.8 Adoption of new accounting standard — — — (0.3 ) — — (0.3 ) Net income — — — 12.6 — — 12.6 Other comprehensive income — — — — 9.8 — 9.8 Dividends — — — (5.2 ) — — (5.2 ) Share repurchases (0.2 ) — (16.9 ) — — — (16.9 ) Incentive plan activity 0.1 — (1.7 ) — — — (1.7 ) Balance, March 31, 2018 21.2 0.2 329.3 611.5 (38.6 ) (1.3 ) 901.1 Net income — — — 9.9 — — 9.9 Other comprehensive loss — — — — (9.9 ) — (9.9 ) Dividends — — — (5.1 ) — — (5.1 ) Share repurchases (0.5 ) — (33.0 ) — — — (33.0 ) Incentive plan activity — — 1.7 — — — 1.7 Balance, June 30, 2018 20.7 0.2 298.0 616.3 (48.5 ) (1.3 ) 864.7 Net income — — — 24.2 — — 24.2 Other comprehensive income — — — — 11.8 — 11.8 Dividends — — — (5.0 ) — — (5.0 ) Share repurchases — — (0.1 ) — — — (0.1 ) Incentive plan activity — — 1.2 — — — 1.2 Balance, September 30, 2018 20.7 $ 0.2 $ 299.1 $ 635.5 $ (36.7 ) $ (1.3 ) $ 896.8 |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019 and 2018 were as follows: Quarters Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in millions) Sales Sealing Products $ 226.9 $ 249.6 $ 690.7 $ 737.2 Engineered Products 72.9 78.1 231.4 249.4 Power Systems 74.0 61.4 201.1 167.2 373.8 389.1 1,123.2 1,153.8 Intersegment sales (0.8 ) (0.9 ) (2.9 ) (3.2 ) Net sales $ 373.0 $ 388.2 $ 1,120.3 $ 1,150.6 Segment Profit Sealing Products $ 19.4 $ 35.9 $ 69.6 $ 78.9 Engineered Products 9.0 8.4 25.3 34.9 Power Systems 8.9 8.7 24.6 12.5 Total segment profit 37.3 53.0 119.5 126.3 Corporate expenses (7.5 ) (7.6 ) (23.7 ) (24.8 ) Interest expense, net (3.8 ) (5.9 ) (12.5 ) (20.8 ) Other expense, net (25.8 ) (15.0 ) (30.3 ) (17.6 ) Income before income taxes $ 0.2 $ 24.5 $ 53.0 $ 63.1 |
Schedule of Total Assets Segment | Segment assets are as follows: September 30, December 31, (in millions) Sealing Products $ 1,379.0 $ 1,009.3 Engineered Products 229.0 220.5 Power Systems 261.9 266.1 Corporate 199.8 219.9 $ 2,069.7 $ 1,715.8 |
Disaggregation of Revenue | Below is a summary of our third party sales by major end market with which we do business for the quarters ended September 30, 2019 and 2018 : Quarter Ended September 30, 2019 (in millions) Sealing Products Engineered Products Power Systems Total Aerospace $ 16.1 $ 3.8 $ — $ 19.9 Automotive 0.5 17.8 — 18.3 Chemical and material processing 14.7 12.2 — 26.9 Food and pharmaceutical 13.0 0.2 — 13.2 General industrial 37.7 23.4 — 61.1 Medium-duty/heavy-duty truck 89.7 0.6 — 90.3 Navy and marine 0.2 — 63.3 63.5 Oil and gas 15.6 7.8 0.6 24.0 Power generation 11.9 2.5 9.9 24.3 Semiconductors 25.5 — — 25.5 Other 1.3 4.5 0.2 6.0 Total third party sales $ 226.2 $ 72.8 $ 74.0 $ 373.0 Quarter Ended September 30, 2018 (in millions) Sealing Products Engineered Products Power Systems Total Aerospace $ 14.3 $ 2.2 $ — $ 16.5 Automotive 1.3 20.7 — 22.0 Chemical and material processing 15.4 12.3 — 27.7 Food and pharmaceutical 9.5 0.2 — 9.7 General industrial 30.4 24.9 — 55.3 Medium-duty/heavy-duty truck 107.6 0.5 — 108.1 Navy and marine 0.3 — 46.7 47.0 Oil and gas 13.9 10.4 3.3 27.6 Power generation 14.1 3.6 10.5 28.2 Semiconductors 31.0 — — 31.0 Other 11.0 3.2 0.9 15.1 Total third party sales $ 248.8 $ 78.0 $ 61.4 $ 388.2 Below is a summary of our third party sales by major end market with which we do business for the nine months ended September 30, 2019 and 2018 : Nine Months Ended September 30, 2019 (in millions) Sealing Products Engineered Products Power Systems Total Aerospace $ 43.0 $ 9.5 $ — $ 52.5 Automotive 2.0 63.6 — 65.6 Chemical and material processing 43.3 37.4 — 80.7 Food and pharmaceutical 32.2 0.5 — 32.7 General industrial 123.6 74.1 — 197.7 Medium-duty/heavy-duty truck 276.7 0.9 — 277.6 Navy and marine 0.6 — 167.0 167.6 Oil and gas 46.6 29.6 3.0 79.2 Power generation 35.2 7.2 30.7 73.1 Semiconductors 78.0 — — 78.0 Other 7.1 8.1 0.4 15.6 Total third party sales $ 688.3 $ 230.9 $ 201.1 $ 1,120.3 Nine Months Ended September 30, 2018 (in millions) Sealing Products Engineered Products Power Systems Total Aerospace $ 39.2 $ 6.5 $ — $ 45.7 Automotive 4.3 76.2 — 80.5 Chemical and material processing 39.6 39.1 — 78.7 Food and pharmaceutical 27.5 0.7 — 28.2 General industrial 125.2 78.0 — 203.2 Medium-duty/heavy-duty truck 302.9 0.8 — 303.7 Navy and marine 0.6 — 118.2 118.8 Oil and gas 41.7 33.6 7.5 82.8 Power generation 46.9 8.9 39.1 94.9 Semiconductors 89.6 — — 89.6 Other 17.0 5.1 2.4 24.5 Total third party sales $ 734.5 $ 248.9 $ 167.2 $ 1,150.6 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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, 2019 December 31, 2018 (in millions) Assets Time deposits $ 27.4 $ 33.4 Foreign currency derivatives 17.2 4.5 Deferred compensation assets 10.2 8.6 $ 54.8 $ 46.5 Liabilities Deferred compensation liabilities $ 10.5 $ 8.9 |
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, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value (in millions) Long-term debt $ 666.3 $ 698.1 $ 464.9 $ 462.1 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
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 quarter ended September 30, 2019 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (8.8 ) $ (44.0 ) $ (52.8 ) Other comprehensive income before reclassifications 3.9 — 3.9 Amounts reclassified from accumulated other comprehensive loss — 1.3 1.3 Net current-period other comprehensive income (loss) 3.9 1.3 5.2 Ending balance $ (4.9 ) $ (42.7 ) $ (47.6 ) Changes in accumulated other comprehensive loss by component (after tax) for the quarter ended September 30, 2018 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (9.0 ) $ (39.5 ) $ (48.5 ) Other comprehensive income (loss) before reclassifications 3.0 (2.0 ) 1.0 Amounts reclassified from accumulated other comprehensive loss — 10.8 10.8 Net current-period other comprehensive income 3.0 8.8 11.8 Ending balance $ (6.0 ) $ (30.7 ) $ (36.7 ) Changes in accumulated other comprehensive loss by component (after tax) for the nine months ended September 30, 2019 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (10.6 ) $ (34.9 ) $ (45.5 ) Adoption of new accounting standard — (11.5 ) (11.5 ) Adjusted beginning balance (10.6 ) (46.4 ) (57.0 ) Other comprehensive income before reclassifications 5.7 — 5.7 Amounts reclassified from accumulated other comprehensive loss — 3.7 3.7 Net current-period other comprehensive income 5.7 3.7 9.4 Ending balance $ (4.9 ) $ (42.7 ) $ (47.6 ) Changes in accumulated other comprehensive loss by component (after tax) for the nine months ended September 30, 2018 are as follows: (in millions) Unrealized Translation Adjustments Pension and Other Postretirement Plans Total Beginning balance $ (6.8 ) $ (41.6 ) $ (48.4 ) Other comprehensive income (loss) before reclassifications 0.8 (2.0 ) (1.2 ) Amounts reclassified from accumulated other comprehensive loss — 12.9 12.9 Net current-period other comprehensive income 0.8 10.9 11.7 Ending balance $ (6.0 ) $ (30.7 ) $ (36.7 ) |
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, 2019 and 2018 are as follows: Details about Accumulated Other Comprehensive Loss Components Amount Reclassified from Accumulated Other Affected Statement of Operations Caption Quarters Ended Nine Months Ended (in millions) 2019 2018 2019 2018 Pension and other postretirement plans adjustments: Actuarial losses $ 1.7 $ 1.1 $ 5.0 $ 4.0 (1) Prior service costs 0.1 0.1 0.2 0.2 (1) Settlement loss — 12.8 — 12.8 (1) Total before tax $ 1.8 $ 14.0 $ 5.2 $ 17.0 Income before income taxes Tax benefit (0.5 ) (3.2 ) (1.5 ) (4.1 ) Income tax expense Net of tax $ 1.3 $ 10.8 $ 3.7 $ 12.9 Net income (loss) (1) These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. As these are components of net periodic pension cost other than service cost, the affected Statement of Operations caption is other (non-operating) expense (See Note 11, “Pensions and Postretirement Benefits ” for additional details). |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Product Warranty Liability | Changes in the product warranty liability for the nine months ended September 30, 2019 and 2018 are as follows: 2019 2018 (in millions) Balance at beginning of year $ 11.7 $ 5.3 Net charges to expense 6.7 5.8 Settlements made (4.7 ) (2.3 ) Balance at end of period $ 13.7 $ 8.8 |
Supplemental Guarantor Financ_2
Supplemental Guarantor Financial Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Condensed Financial Information Disclosure [Abstract] | |
Condensed Income Statement | ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended September 30, 2019 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 266.3 $ 143.4 $ (36.7 ) $ 373.0 Cost of sales — 197.7 97.0 (36.7 ) 258.0 Gross profit — 68.6 46.4 — 115.0 Operating expenses: Selling, general and administrative 11.5 45.1 27.5 — 84.1 Other — 1.4 0.9 — 2.3 Total operating expenses 11.5 46.5 28.4 — 86.4 Operating income (loss) (11.5 ) 22.1 18.0 — 28.6 Interest income (expense), net (3.0 ) (1.0 ) 0.2 — (3.8 ) Other expense — (24.5 ) (0.1 ) — (24.6 ) Income (loss) before income taxes (14.5 ) (3.4 ) 18.1 — 0.2 Income tax benefit (expense) — 4.3 (6.0 ) — (1.7 ) Income (loss) before equity in earnings of subsidiaries (14.5 ) 0.9 12.1 — (1.5 ) Equity in earnings of subsidiaries, net of tax 13.0 12.1 — (25.1 ) — Net income (loss) $ (1.5 ) $ 13.0 $ 12.1 $ (25.1 ) $ (1.5 ) Comprehensive income $ 3.7 $ 8.0 $ 5.8 $ (13.8 ) $ 3.7 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Quarter Ended September 30, 2018 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 279.3 $ 153.2 $ (44.3 ) $ 388.2 Cost of sales — 203.6 104.8 (44.3 ) 264.1 Gross profit — 75.7 48.4 — 124.1 Operating expenses: Selling, general and administrative 11.3 39.1 28.5 — 78.9 Other (0.1 ) 0.8 0.3 — 1.0 Total operating expenses 11.2 39.9 28.8 — 79.9 Operating income (loss) (11.2 ) 35.8 19.6 — 44.2 Interest income (expense), net (5.4 ) (0.6 ) 0.1 — (5.9 ) Other expense — (13.7 ) (0.1 ) — (13.8 ) Income (loss) before income taxes (16.6 ) 21.5 19.6 — 24.5 Income tax benefit (expense) 2.6 2.2 (5.1 ) — (0.3 ) Income (loss) before equity in earnings of subsidiaries (14.0 ) 23.7 14.5 — 24.2 Equity in earnings of subsidiaries, net of tax 38.2 14.5 — (52.7 ) — Net income $ 24.2 $ 38.2 $ 14.5 $ (52.7 ) $ 24.2 Comprehensive income $ 36.0 $ 51.7 $ 19.2 $ (70.9 ) $ 36.0 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2019 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 799.8 $ 440.2 $ (119.7 ) $ 1,120.3 Cost of sales — 587.4 299.4 (119.7 ) 767.1 Gross profit — 212.4 140.8 — 353.2 Operating expenses: Selling, general and administrative 35.7 134.3 85.7 — 255.7 Other 0.4 2.0 2.3 — 4.7 Total operating expenses 36.1 136.3 88.0 — 260.4 Operating income (loss) (36.1 ) 76.1 52.8 — 92.8 Interest income (expense), net (9.4 ) (3.9 ) 0.8 — (12.5 ) Other expense — (27.1 ) (0.2 ) — (27.3 ) Income (loss) before income taxes (45.5 ) 45.1 53.4 — 53.0 Income tax benefit (expense) 3.8 (4.1 ) (17.2 ) — (17.5 ) Income (loss) before equity in earnings of subsidiaries (41.7 ) 41.0 36.2 — 35.5 Equity in earnings of subsidiaries, net of tax 77.2 36.2 — (113.4 ) — Net income $ 35.5 $ 77.2 $ 36.2 $ (113.4 ) $ 35.5 Comprehensive income $ 44.9 $ 73.2 $ 32.6 $ (105.8 ) $ 44.9 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2018 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated Net sales $ — $ 810.9 $ 465.0 $ (125.3 ) $ 1,150.6 Cost of sales — 603.4 307.5 (125.3 ) 785.6 Gross profit — 207.5 157.5 — 365.0 Operating expenses: Selling, general and administrative 34.7 134.7 91.0 — 260.4 Other — 5.5 0.8 — 6.3 Total operating expenses 34.7 140.2 91.8 — 266.7 Operating income (loss) (34.7 ) 67.3 65.7 — 98.3 Interest income (expense), net (17.6 ) (3.7 ) 0.5 — (20.8 ) Other expense — (14.1 ) (0.3 ) — (14.4 ) Income (loss) before income taxes (52.3 ) 49.5 65.9 — 63.1 Income tax benefit (expense) 10.2 (8.0 ) (18.6 ) — (16.4 ) Income (loss) before equity in earnings of subsidiaries (42.1 ) 41.5 47.3 — 46.7 Equity in earnings of subsidiaries, net of tax 88.8 47.3 — (136.1 ) — Net income $ 46.7 $ 88.8 $ 47.3 $ (136.1 ) $ 46.7 Comprehensive income $ 58.4 $ 96.2 $ 43.8 $ (140.0 ) $ 58.4 |
Condensed Cash Flow Statement | ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2019 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated NET CASH PROVIDED BY OPERATING ACTIVITIES $ 83.1 $ 30.2 $ 55.9 $ (18.5 ) $ 150.7 INVESTING ACTIVITIES Purchases of property, plant and equipment — (17.0 ) (6.8 ) — (23.8 ) Proceeds from sale of business — 3.6 — — 3.6 Acquisitions, net of cash acquired — (271.2 ) (39.2 ) — (310.4 ) Proceeds from sale of property, plant, and equipment 0.4 0.4 — 0.8 Other — (2.6 ) (0.3 ) — (2.9 ) Net cash used in investing activities — (286.8 ) (45.9 ) — (332.7 ) FINANCING ACTIVITIES Net payments on loans between subsidiaries (47.4 ) 52.5 (5.1 ) — — Intercompany dividends — — (18.5 ) 18.5 Proceeds from debt — 566.9 — — 566.9 Repayments of debt — (365.1 ) — — (365.1 ) Repurchase of common stock (15.0 ) — (15.0 ) Dividends paid (15.7 ) — (15.7 ) Other (5.0 ) — — — (5.0 ) Net cash provided by (used in) financing activities (83.1 ) 254.3 (23.6 ) 18.5 166.1 Effect of exchange rate changes on cash and cash equivalents — — (1.6 ) — (1.6 ) Net decrease in cash and cash equivalents — (2.3 ) (15.2 ) — (17.5 ) Cash and cash equivalents at beginning of period — 2.3 127.3 — 129.6 Cash and cash equivalents at end of period $ — $ — $ 112.1 $ — $ 112.1 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2018 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated NET CASH PROVIDED BY OPERATING ACTIVITIES $ 69.5 $ 145.6 $ 57.6 $ (114.3 ) $ 158.4 INVESTING ACTIVITIES Purchases of property, plant and equipment — (37.5 ) (8.2 ) — (45.7 ) Receipts from derivative contracts 9.3 — — — 9.3 Proceeds from sale of property, plant and equipment — 26.0 0.6 — 26.6 Other — (1.8 ) (0.2 ) — (2.0 ) Net cash provided by (used in) investing activities 9.3 (13.3 ) (7.8 ) — (11.8 ) FINANCING ACTIVITIES Net payments on loans between subsidiaries (8.0 ) 8.4 (0.4 ) — — Intercompany dividends — — (114.3 ) 114.3 — Proceeds from debt — 454.9 — — 454.9 Repayments of debt — (594.4 ) — — (594.4 ) Repurchase of common stock (50.0 ) — — — (50.0 ) Dividends paid (15.3 ) — — — (15.3 ) Other (5.5 ) (1.2 ) — — (6.7 ) Net cash used in financing activities (78.8 ) (132.3 ) (114.7 ) 114.3 (211.5 ) Effect of exchange rate changes on cash and cash equivalents — — (4.5 ) — (4.5 ) Net decrease in cash and cash equivalents — — (69.4 ) — (69.4 ) Cash and cash equivalents at beginning of period — — 189.3 — 189.3 Cash and cash equivalents at end of period $ — $ — $ 119.9 $ — $ 119.9 |
Condensed Balance Sheet | ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING BALANCE SHEETS (UNAUDITED) As of September 30, 2019 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets Cash and cash equivalents $ — $ — $ 112.1 $ — $ 112.1 Accounts receivable, net 0.2 200.3 86.6 — 287.1 Intercompany receivables — 16.8 11.4 (28.2 ) — Inventories — 153.3 72.2 — 225.5 Income tax receivable 27.3 0.3 10.9 — 38.5 Prepaid expenses and other current assets 5.7 22.1 6.6 — 34.4 Total current assets 33.2 392.8 299.8 (28.2 ) 697.6 Property, plant and equipment, net — 195.6 89.3 — 284.9 Goodwill — 291.1 193.9 — 485.0 Other intangible assets, net — 232.7 261.6 — 494.3 Intercompany receivables — 2.8 5.1 (7.9 ) — Investment in subsidiaries 1,218.7 665.4 — (1,884.1 ) — Other assets 31.9 39.6 36.4 — 107.9 Total assets $ 1,283.8 $ 1,820.0 $ 886.1 $ (1,920.2 ) $ 2,069.7 LIABILITIES AND EQUITY Current liabilities Current maturities of long-term debt $ — $ 0.4 $ — $ — $ 0.4 Accounts payable 2.0 71.4 32.2 — 105.6 Intercompany payables — 11.4 16.8 (28.2 ) — Accrued expenses 20.5 112.9 67.4 — 200.8 Total current liabilities 22.5 196.1 116.4 (28.2 ) 306.8 Long-term debt 345.2 320.4 0.3 — 665.9 Intercompany payables 3.7 1.4 2.8 (7.9 ) — Other liabilities 36.0 55.4 101.2 — 192.6 Total liabilities 407.4 573.3 220.7 (36.1 ) 1,165.3 Redeemable non-controlling interest — 28.0 — — 28.0 Shareholders’ equity 876.4 1,218.7 665.4 (1,884.1 ) 876.4 Total liabilities and equity $ 1,283.8 $ 1,820.0 $ 886.1 $ (1,920.2 ) $ 2,069.7 ENPRO INDUSTRIES, INC. CONDENSED CONSOLIDATING BALANCE SHEETS (UNAUDITED) As of December 31, 2018 (in millions) Guarantor Non-guarantor Parent Subsidiaries Subsidiaries Eliminations Consolidated ASSETS Current assets Cash and cash equivalents $ — $ 2.3 $ 127.3 $ — $ 129.6 Accounts receivable, net — 210.3 76.3 — 286.6 Intercompany receivables — 19.0 8.9 (27.9 ) — Inventories — 155.3 77.8 — 233.1 Income tax receivable 42.9 0.3 6.4 — 49.6 Prepaid expenses and other current assets 4.9 20.3 8.0 — 33.2 Total current assets 47.8 407.5 304.7 (27.9 ) 732.1 Property, plant and equipment, net 2.2 209.7 89.3 — 301.2 Goodwill — 261.0 72.7 — 333.7 Other intangible assets, net — 242.2 55.1 — 297.3 Intercompany receivables — 53.9 — (53.9 ) — Investment in subsidiaries 1,246.4 387.7 — (1,634.1 ) — Other assets 13.6 25.3 12.6 — 51.5 Total assets $ 1,310.0 $ 1,587.3 $ 534.4 $ (1,715.9 ) $ 1,715.8 LIABILITIES AND EQUITY Current liabilities Current maturities of long-term debt $ 2.1 $ 0.3 $ — $ — $ 2.4 Accounts payable 2.1 99.0 38.1 — 139.2 Intercompany payables — 8.9 19.0 (27.9 ) — Accrued expenses 13.9 82.8 53.7 — 150.4 Total current liabilities 18.1 191.0 110.8 (27.9 ) 292.0 Long-term debt 345.0 117.5 — — 462.5 Intercompany payables 51.1 — 2.8 (53.9 ) — Other liabilities 38.1 32.4 33.1 — 103.6 Total liabilities 452.3 340.9 146.7 (81.8 ) 858.1 Shareholders’ equity 857.7 1,246.4 387.7 (1,634.1 ) 857.7 Total liabilities and equity $ 1,310.0 $ 1,587.3 $ 534.4 $ (1,715.9 ) $ 1,715.8 |
Overview, Basis of Presentati_3
Overview, Basis of Presentation and Recently Issued Authoritative Accounting Guidance (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Jan. 01, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Right-of-use assets | $ 37.8 | |
Lease liability | 38.1 | |
Pension and Other Postretirement Plans | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Adoption of new accounting standard | $ 11.5 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Right-of-use assets | $ 30 | |
Lease liability | $ 30 |
Acquisitions and Divestiture -
Acquisitions and Divestiture - Acquisitions Narrative (Details) $ in Millions | Sep. 25, 2019USD ($)installmentsellerlocation | Jul. 02, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) |
Business Acquisition [Line Items] | |||||||
Acquisitions, net of cash acquired | $ 310.4 | $ 0 | |||||
Goodwill | $ 485 | 485 | $ 333.7 | ||||
Net sales | 373 | $ 388.2 | 1,120.3 | 1,150.6 | |||
Pre-tax income | 0.2 | $ 24.5 | 53 | $ 63.1 | |||
LeanTeq and Aseptic | |||||||
Business Acquisition [Line Items] | |||||||
Acquisition-related costs | 5.6 | 6.7 | $ 6.7 | ||||
Goodwill | $ 152.5 | ||||||
Expected tax deductible goodwill | $ 2.7 | ||||||
Expected tax deductible goodwill term | 15 years | ||||||
Definite-lived intangible assets | $ 219 | ||||||
Indemnification assets | 5.4 | ||||||
Contingent liabilities | 8.2 | ||||||
Net sales | 2.9 | ||||||
Pre-tax income | 0.7 | ||||||
LeanTeq and Aseptic | Customer relationships, proprietary technology, trade names, favorable leasehold interests and non-competition agreements | |||||||
Business Acquisition [Line Items] | |||||||
Definite-lived intangible assets | $ 217.9 | ||||||
Weighted average amortization period | 16 years | ||||||
LeanTeq and Aseptic | Trade Names | |||||||
Business Acquisition [Line Items] | |||||||
Definite-lived intangible assets | $ 1.1 | ||||||
LeanTeq | |||||||
Business Acquisition [Line Items] | |||||||
Acquisitions, net of cash acquired | $ 271.2 | ||||||
Number of sellers | seller | 2 | ||||||
Acquisition-related costs | $ 5.6 | $ 6.4 | |||||
LeanTeq | Lunar | |||||||
Business Acquisition [Line Items] | |||||||
Percent of ownership by rollover equity sellers | 10.00% | ||||||
Fair value of rollover equity | $ 28 | ||||||
Rollover equity right term following third anniversary of closing | 90 days | ||||||
Rollover equity rights payable installments | installment | 2 | ||||||
Rollover equity rights payable installments term | 12 months | ||||||
Rollover equity rights, discount for certain events | 20.00% | ||||||
Rollover equity, calculated compensation amount | $ 6.4 | ||||||
LeanTeq | Taiwan | |||||||
Business Acquisition [Line Items] | |||||||
Number of locations | location | 2 | ||||||
LeanTeq | U.S. | |||||||
Business Acquisition [Line Items] | |||||||
Number of locations | location | 1 | ||||||
Aseptic | |||||||
Business Acquisition [Line Items] | |||||||
Percent acquired | 100.00% | ||||||
Consideration transferred | $ 39.2 |
Acquisitions and Divestiture _2
Acquisitions and Divestiture - Schedules (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 25, 2019 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 485 | $ 485 | $ 333.7 | |||
LeanTeq and Aseptic | ||||||
Business Acquisition [Line Items] | ||||||
Accounts receivable | $ 9.8 | |||||
Property, plant and equipment | 7.9 | |||||
Goodwill | 152.5 | |||||
Other intangible assets | 219 | |||||
Other assets | 17 | |||||
Deferred income taxes | (43.6) | |||||
Liabilities assumed | (24.2) | |||||
Redeemable non-controlling interest | (28) | |||||
Purchase price allocation | $ 310.4 | |||||
Pro forma net sales | 379.8 | $ 397.7 | 1,149.3 | $ 1,177.7 | ||
Pro forma net income | $ 1.6 | $ 22.5 | $ 36.6 | $ 36.7 |
Acquisitions and Divestiture _3
Acquisitions and Divestiture - Divestiture (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Dec. 31, 2019 | Sep. 30, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2020 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Proceeds from sale of business | $ 3.6 | $ 0 | ||||
Certain Assets and Liabilities of Brake Products Business | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Loss on disposal | $ 15.2 | |||||
Proceeds from sale of business | $ 7 | |||||
Sale of Facility | Forecast | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Proceeds from sale of business | $ 3 | $ 0.4 | ||||
Sale of Facility | Other Expense | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Loss on disposal | $ 0.6 | 0.6 | ||||
Sale of Business | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Proceeds from sale of business | 3.6 | |||||
Sale of Business | Other Expense | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Loss on disposal | $ 14.6 | 14.6 | ||||
Non-Cash Loss on Sale of Business | Other Expense | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Loss on disposal | 11.4 | |||||
Contract Cancellation, Severance and Other | Other Expense | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Loss on disposal | $ 3.2 |
Revenue from Contracts with C_3
Revenue from Contracts with Customers - Schedule of Information Regarding Contracts Accounted for Under Percentage-of-Completion Method (Detail) - Other Liabilities - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Cumulative revenues recognized on uncompleted contracts | $ 455.9 | $ 452.5 |
Cumulative billings on uncompleted contracts | 438.6 | 393.9 |
Revenues and billing on uncompleted contracts | $ 17.3 | $ 58.6 |
Revenue from Contracts with C_4
Revenue from Contracts with Customers - Schedule of Uncompleted Contracts Reflected in Consolidated Balance Sheets (Detail) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accrued expenses (billings in excess of revenue recognized) | $ (40.6) | $ (5.5) |
Accounts Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accounts receivable, net (contract revenue recognized in excess of billings) | 57.7 | 63.9 |
Accrued Liabilities | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Accrued expenses (billings in excess of revenue recognized) | (40.4) | (5.3) |
Other Liabilities | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Revenues and billing on uncompleted contracts | $ 17.3 | $ 58.6 |
Revenue from Contracts with C_5
Revenue from Contracts with Customers - Contract with Customer, Asset and Liability (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Contract with Customer, Liabilities [Roll Forward] | ||
Balance at beginning of period | $ 5.5 | |
Additional billings in excess of revenue recognized | 63.2 | |
Revenue recognized | (28.1) | |
Balance at end of period | 40.6 | |
Retainage deposit | 1.9 | $ 1 |
Performance obligation | $ 404.3 |
Revenue from Contracts with C_6
Revenue from Contracts with Customers - Other (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-10-01 | Sep. 30, 2019 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation, percentage | 88.00% |
Remaining performance obligation, expected timing | 1 year |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | ||||
Effective tax rate | 878.70% | 1.20% | 33.00% | 26.00% |
Federal statutory income tax rate | 21.00% |
Earnings (Loss) Per Share - Sch
Earnings (Loss) 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, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Numerator (basic and diluted): | ||||||||
Net income (loss) | $ (1.5) | $ 23.9 | $ 13.1 | $ 24.2 | $ 9.9 | $ 12.6 | $ 35.5 | $ 46.7 |
Denominator: | ||||||||
Weighted-average shares – basic (in shares) | 20.6 | 20.7 | 20.7 | 21 | ||||
Share-based awards (in shares) | 0 | 0.2 | 0.1 | 0.2 | ||||
Weighted-average shares – diluted (in shares) | 20.6 | 20.9 | 20.8 | 21.2 | ||||
Earnings (loss) per share: | ||||||||
Basic (in dollars per share) | $ (0.08) | $ 1.17 | $ 1.71 | $ 2.22 | ||||
Diluted (in dollars per share) | $ (0.08) | $ 1.16 | $ 1.71 | $ 2.20 | ||||
Shares excluded (in shares) | 0.1 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Detail) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Finished products | $ 141.7 | $ 142.9 |
Work in process | 36.8 | 33.6 |
Raw materials and supplies | 58.3 | 67.7 |
Gross inventories | 236.8 | 244.2 |
Reserve to reduce certain inventories to LIFO basis | (11.3) | (11.1) |
Total inventories | $ 225.5 | $ 233.1 |
Goodwill and Other Intangible_3
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, 2019USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | $ 333.7 |
Acquisitions of businesses | 152.5 |
Divestiture of business | (1.3) |
Foreign currency translation | 0.1 |
Goodwill, ending balance | 485 |
Sealing Products | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 311.3 |
Acquisitions of businesses | 152.5 |
Divestiture of business | (1.3) |
Foreign currency translation | (0.1) |
Goodwill, ending balance | 462.4 |
Engineered Products | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 10.8 |
Acquisitions of businesses | 0 |
Divestiture of business | 0 |
Foreign currency translation | 0.1 |
Goodwill, ending balance | 10.9 |
Power Systems | |
Goodwill [Roll Forward] | |
Goodwill, beginning balance | 11.6 |
Acquisitions of businesses | 0 |
Divestiture of business | 0 |
Foreign currency translation | 0.1 |
Goodwill, ending balance | $ 11.7 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Schedule of Identifiable Intangible Assets (Detail) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 670.5 | $ 460.4 |
Accumulated Amortization | 255.2 | 242.2 |
Total | 749.5 | 539.5 |
Trademarks | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-Lived: | 79 | 79.1 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 472.3 | 284.5 |
Accumulated Amortization | 157.9 | 150.2 |
Existing technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 124.5 | 112.3 |
Accumulated Amortization | 49.4 | 45.1 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 39.7 | 35.3 |
Accumulated Amortization | 23.8 | 23.1 |
Other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 34 | 28.3 |
Accumulated Amortization | $ 24.1 | $ 23.8 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||
Amortization expense | $ 7.4 | $ 7 | $ 21.4 | $ 21.9 | |
Sealing Products | |||||
Segment Reporting Information [Line Items] | |||||
Accumulated impairment losses | $ 27.8 | $ 27.8 | $ 27.8 | ||
Engineered Products | |||||
Segment Reporting Information [Line Items] | |||||
Accumulated impairment losses | $ 154.8 |
Leases - Narrative and Other In
Leases - Narrative and Other Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | |
Lessee, Lease, Description [Line Items] | ||||
Lease term not recorded on balance sheet | 12 months | |||
Operating lease cost | $ 3 | $ 8.9 | ||
Operating cash flows from operating leases | 3.1 | 9.3 | ||
Short-term and variable lease costs | 0.6 | 1.6 | ||
New right-of-use assets | $ 10.3 | $ 16.3 | ||
Weighted average remaining lease term for operating lease | 5 years 8 months 12 days | 5 years 8 months 12 days | ||
Weighted average operating discount rate used to determine the operating lease liability (percent) | 4.10% | 4.10% | ||
Net rent expense | $ 13.5 | |||
Right-of-use assets | $ 37.8 | $ 37.8 | ||
Lease liability | $ 38.1 | $ 38.1 | ||
Building | ||||
Lessee, Lease, Description [Line Items] | ||||
Remaining lease term | 12 years | |||
Lease renewal term | 5 years | 5 years | ||
Building | Forecast | ||||
Lessee, Lease, Description [Line Items] | ||||
Right-of-use assets | $ 0.7 | |||
Lease liability | $ 0.7 | |||
Vehicle, equipment, and other leases | ||||
Lessee, Lease, Description [Line Items] | ||||
Remaining lease term | 7 years | |||
Percent of operating lease assets and liabilities | 13.00% | 13.00% | ||
Real estate | ||||
Lessee, Lease, Description [Line Items] | ||||
Percent of operating lease assets and liabilities | 87.00% | 87.00% |
Leases - Balance Sheet Classifi
Leases - Balance Sheet Classification (Details) $ in Millions | Sep. 30, 2019USD ($) |
Leases [Abstract] | |
Right-of-use assets | $ 37.8 |
Current liability | 10 |
Long-term liability | 28.1 |
Total liability | $ 38.1 |
Leases - Maturities of Operatin
Leases - Maturities of Operating Lease Liabilities (Details) $ in Millions | Sep. 30, 2019USD ($) |
Operating leases | |
Remainder of 2019 | $ 3.2 |
2020 | 10.7 |
2021 | 8.2 |
2022 | 5.7 |
2023 | 4.6 |
Thereafter | 11.4 |
Total lease payments | 43.8 |
Imputed interest | (5) |
Lessee, Operating Lease, Liability, Future Leases | (0.7) |
Present value of lease liabilities | $ 38.1 |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) $ in Millions | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
2019 | $ 11.5 |
2020 | 9 |
2021 | 6.2 |
2022 | 4.4 |
2023 | 3.4 |
Thereafter | 2.7 |
Total minimum payments | $ 37.2 |
Accrued Expenses - Schedule of
Accrued Expenses - Schedule of Accrued Expenses (Detail) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Salaries, wages and employee benefits | $ 53.8 | $ 59.5 |
Interest | 9.4 | 4.9 |
Customer advances | 42.2 | 7.1 |
Environmental | 16.3 | 16.4 |
Warranty | 4.9 | 10.9 |
Income and other taxes | 27.9 | 21.8 |
Operating lease liabilities | 10 | |
Other | 36.3 | 29.8 |
Accrued expenses | $ 200.8 | $ 150.4 |
Long-Term Debt - Narrative (Det
Long-Term Debt - Narrative (Details) - USD ($) | Sep. 25, 2019 | Oct. 17, 2018 | Sep. 30, 2019 | Sep. 30, 2019 | Oct. 31, 2018 |
Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Expansion threshold | $ 225,000,000 | ||||
Expansion threshold percent | 100.00% | ||||
Capacity available for specific purpose | $ 100,000,000 | $ 100,000,000 | |||
Credit facility borrowing capacity | 212,800,000 | 212,800,000 | |||
Letter of credit outstanding | $ 17,500,000 | $ 17,500,000 | |||
Revolving Credit Facility | LIBOR | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 1.50% | ||||
Revolving Credit Facility | Base Rate | |||||
Line of Credit Facility [Line Items] | |||||
Basis spread on variable rate | 0.50% | ||||
Term Loan | |||||
Line of Credit Facility [Line Items] | |||||
Periodic payment, years one to three, percentage of original principal amount | 2.50% | ||||
Loan facility for one year | 5.00% | 5.00% | |||
Loan facility for two years | 1.25% | 1.25% | |||
Term Loan | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | $ 150,000,000 | ||||
Long-term line of credit | $ 150,000,000 | $ 150,000,000 | |||
Line of Credit | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Debt term | 5 years | ||||
Borrowing capacity | $ 400,000,000 | ||||
Commitment fee on unused amount | 0.175% | ||||
Long-term line of credit | $ 169,700,000 | $ 169,700,000 | |||
Senior Notes | |||||
Line of Credit Facility [Line Items] | |||||
Senior notes | $ 350,000,000 | ||||
Stated interest rate | 5.75% | ||||
Redemption price as a percentage of principal | 100.00% |
Pensions and Postretirement B_3
Pensions and Postretirement Benefits - Schedule of Net Periodic Benefit Cost (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Pension Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 1.1 | $ 1.2 | $ 3.4 | $ 3.7 |
Interest cost | 3.1 | 2.9 | 9.2 | 9.7 |
Expected return on plan assets | (4) | (4.2) | (12) | (14.9) |
Amortization of prior service cost | 0 | 0 | 0.1 | 0.1 |
Amortization of net loss | 1.7 | 1.1 | 5 | 4 |
Settlement | 0 | 12.8 | 0 | 12.8 |
Net periodic benefit cost | 1.9 | 13.8 | 5.7 | 15.4 |
Other Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0 | 0 | 0.1 | 0.1 |
Interest cost | 0 | 0 | 0.1 | 0.1 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of prior service cost | 0.1 | 0.1 | 0.1 | 0.1 |
Amortization of net loss | 0 | 0 | 0 | 0 |
Settlement | 0 | 0 | ||
Net periodic benefit cost | $ 0.1 | $ 0.1 | $ 0.3 | 0.3 |
U.S. | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Contributions | $ 20 |
Shareholders' Equity - Changes
Shareholders' Equity - Changes in Shareholders' Equity (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning balance | $ 876.2 | $ 871.1 | $ 857.7 | $ 864.7 | $ 901.1 | $ 902.8 | $ 857.7 | $ 902.8 |
Adoption of accounting standard | 0 | (0.3) | ||||||
Net income | (1.5) | 23.9 | 13.1 | 24.2 | 9.9 | 12.6 | 35.5 | 46.7 |
Other comprehensive income (loss) | 5.2 | (2.6) | 6.8 | 11.8 | (9.9) | 9.8 | 11.7 | |
Dividends | (5.2) | (5.2) | (5.3) | (5) | (5.1) | (5.2) | ||
Share repurchases | (12.6) | (2.4) | (0.1) | (33) | (16.9) | |||
Incentive plan activity | 1.7 | 1.6 | 1.2 | 1.2 | 1.7 | (1.7) | ||
Ending balance | $ 876.4 | $ 876.2 | $ 871.1 | $ 896.8 | $ 864.7 | $ 901.1 | $ 876.4 | $ 896.8 |
Common Stock | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Balance (in shares) | 20,600,000 | 20,800,000 | 20,700,000 | 20,700,000 | 21,200,000 | 21,300,000 | 20,700,000 | 21,300,000 |
Beginning balance | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 |
Shares repurchases (in shares) | 0 | (200,000) | (500,000) | (200,000) | (200,000) | |||
Incentive plan activity (in shares) | 100,000 | 100,000 | ||||||
Balance (in shares) | 20,600,000 | 20,600,000 | 20,800,000 | 20,700,000 | 20,700,000 | 21,200,000 | 20,600,000 | 20,700,000 |
Ending balance | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 | $ 0.2 |
Additional Paid-in Capital | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning balance | 288.8 | 299.8 | 301 | 298 | 329.3 | 347.9 | 301 | 347.9 |
Share repurchases | (12.6) | (2.4) | (0.1) | (33) | (16.9) | |||
Incentive plan activity | 1.7 | 1.6 | 1.2 | 1.2 | 1.7 | (1.7) | ||
Ending balance | 290.5 | 288.8 | 299.8 | 299.1 | 298 | 329.3 | 290.5 | 299.1 |
Retained Earnings | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning balance | 641.3 | 622.6 | 603.3 | 616.3 | 611.5 | 604.4 | 603.3 | 604.4 |
Adoption of accounting standard | 11.5 | (0.3) | ||||||
Net income | (1.5) | 23.9 | 13.1 | 24.2 | 9.9 | 12.6 | ||
Dividends | (5.2) | (5.2) | (5.3) | (5) | (5.1) | (5.2) | ||
Ending balance | 634.6 | 641.3 | 622.6 | 635.5 | 616.3 | 611.5 | 634.6 | 635.5 |
Accumulated Other Comprehensive Loss | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning balance | (52.8) | (50.2) | (45.5) | (48.5) | (38.6) | (48.4) | (45.5) | (48.4) |
Adoption of accounting standard | (11.5) | |||||||
Other comprehensive income (loss) | 5.2 | (2.6) | 6.8 | 11.8 | (9.9) | 9.8 | 9.4 | |
Ending balance | (47.6) | (52.8) | (50.2) | (36.7) | (48.5) | (38.6) | (47.6) | (36.7) |
Treasury Stock | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning balance | (1.3) | (1.3) | (1.3) | (1.3) | (1.3) | (1.3) | (1.3) | (1.3) |
Ending balance | (1.3) | (1.3) | (1.3) | $ (1.3) | $ (1.3) | $ (1.3) | (1.3) | $ (1.3) |
Redeemable non-controlling interest | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Beginning Balance | 0 | 0 | 0 | 0 | ||||
LeanTeq acquisition | 28 | |||||||
Ending Balance | $ 28 | $ 0 | $ 0 | $ 28 |
Shareholders' Equity - Narrativ
Shareholders' Equity - Narrative (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Oct. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Oct. 31, 2018 | |
Subsequent Event [Line Items] | |||||||||
Dividends paid | $ (15,700,000) | $ (15,300,000) | |||||||
Cash dividends per share (in dollars per share) | $ 0.25 | $ 0.24 | $ 0.75 | $ 0.72 | |||||
Repurchase of common stock | $ 15,000,000 | $ 50,000,000 | |||||||
Subsequent Event | |||||||||
Subsequent Event [Line Items] | |||||||||
Cash dividends per share (in dollars per share) | $ 0.25 | ||||||||
Common Stock | |||||||||
Subsequent Event [Line Items] | |||||||||
Shares repurchases (in shares) | 0 | 200,000 | 500,000 | 200,000 | 200,000 | ||||
Share Repurchase Plan | |||||||||
Subsequent Event [Line Items] | |||||||||
Authorized amount | $ 50,000,000 | ||||||||
Repurchase of common stock | $ 15,000,000 | ||||||||
Remaining amount of authorized purchases | $ 35,000,000 | $ 35,000,000 |
Business Segment Information -
Business Segment Information - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2019Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Business Segment Information _2
Business Segment Information - Schedule of Segment Operating Results and Other Financial Data (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 373 | $ 388.2 | $ 1,120.3 | $ 1,150.6 |
Segment profit | 28.6 | 44.2 | 92.8 | 98.3 |
Other expense, net | (24.6) | (13.8) | (27.3) | (14.4) |
Income before income taxes | 0.2 | 24.5 | 53 | 63.1 |
Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 373.8 | 389.1 | 1,123.2 | 1,153.8 |
Segment profit | 37.3 | 53 | 119.5 | 126.3 |
Intersegment sales | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0.8 | 0.9 | 2.9 | 3.2 |
Corporate expense | ||||
Segment Reporting Information [Line Items] | ||||
Segment profit | (7.5) | (7.6) | (23.7) | (24.8) |
Interest expense, net | (3.8) | (5.9) | (12.5) | (20.8) |
Other expense, net | (25.8) | (15) | (30.3) | (17.6) |
Sealing Products | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 226.2 | 248.8 | 688.3 | 734.5 |
Sealing Products | Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 226.9 | 249.6 | 690.7 | 737.2 |
Segment profit | 19.4 | 35.9 | 69.6 | 78.9 |
Engineered Products | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 72.8 | 78 | 230.9 | 248.9 |
Engineered Products | Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 72.9 | 78.1 | 231.4 | 249.4 |
Segment profit | 9 | 8.4 | 25.3 | 34.9 |
Power Systems | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 74 | 61.4 | 201.1 | 167.2 |
Power Systems | Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 74 | 61.4 | 201.1 | 167.2 |
Segment profit | $ 8.9 | $ 8.7 | $ 24.6 | $ 12.5 |
Business Segment Information _3
Business Segment Information - Schedule of Assets and Long Lived Assets Segment (Detail) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Schedule Of Assets By Segment [Line Items] | ||
Assets | $ 2,069.7 | $ 1,715.8 |
Operating segments | Sealing Products | ||
Schedule Of Assets By Segment [Line Items] | ||
Assets | 1,379 | 1,009.3 |
Operating segments | Engineered Products | ||
Schedule Of Assets By Segment [Line Items] | ||
Assets | 229 | 220.5 |
Operating segments | Power Systems | ||
Schedule Of Assets By Segment [Line Items] | ||
Assets | 261.9 | 266.1 |
Corporate expense | ||
Schedule Of Assets By Segment [Line Items] | ||
Assets | $ 199.8 | $ 219.9 |
Business Segment Information _4
Business Segment Information - Revenue by End Market (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 373 | $ 388.2 | $ 1,120.3 | $ 1,150.6 |
Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 226.2 | 248.8 | 688.3 | 734.5 |
Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 72.8 | 78 | 230.9 | 248.9 |
Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 74 | 61.4 | 201.1 | 167.2 |
Aerospace | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 19.9 | 16.5 | 52.5 | 45.7 |
Aerospace | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 16.1 | 14.3 | 43 | 39.2 |
Aerospace | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 3.8 | 2.2 | 9.5 | 6.5 |
Aerospace | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Automotive | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 18.3 | 22 | 65.6 | 80.5 |
Automotive | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0.5 | 1.3 | 2 | 4.3 |
Automotive | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 17.8 | 20.7 | 63.6 | 76.2 |
Automotive | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Chemical and material processing | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 26.9 | 27.7 | 80.7 | 78.7 |
Chemical and material processing | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 14.7 | 15.4 | 43.3 | 39.6 |
Chemical and material processing | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 12.2 | 12.3 | 37.4 | 39.1 |
Chemical and material processing | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Food and pharmaceutical | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 13.2 | 9.7 | 32.7 | 28.2 |
Food and pharmaceutical | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 13 | 9.5 | 32.2 | 27.5 |
Food and pharmaceutical | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0.2 | 0.2 | 0.5 | 0.7 |
Food and pharmaceutical | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
General industrial | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 61.1 | 55.3 | 197.7 | 203.2 |
General industrial | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 37.7 | 30.4 | 123.6 | 125.2 |
General industrial | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 23.4 | 24.9 | 74.1 | 78 |
General industrial | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Medium-duty/heavy-duty truck | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 90.3 | 108.1 | 277.6 | 303.7 |
Medium-duty/heavy-duty truck | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 89.7 | 107.6 | 276.7 | 302.9 |
Medium-duty/heavy-duty truck | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0.6 | 0.5 | 0.9 | 0.8 |
Medium-duty/heavy-duty truck | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Navy and marine | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 63.5 | 47 | 167.6 | 118.8 |
Navy and marine | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0.2 | 0.3 | 0.6 | 0.6 |
Navy and marine | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Navy and marine | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 63.3 | 46.7 | 167 | 118.2 |
Oil and gas | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 24 | 27.6 | 79.2 | 82.8 |
Oil and gas | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 15.6 | 13.9 | 46.6 | 41.7 |
Oil and gas | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 7.8 | 10.4 | 29.6 | 33.6 |
Oil and gas | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0.6 | 3.3 | 3 | 7.5 |
Power generation | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 24.3 | 28.2 | 73.1 | 94.9 |
Power generation | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 11.9 | 14.1 | 35.2 | 46.9 |
Power generation | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 2.5 | 3.6 | 7.2 | 8.9 |
Power generation | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 9.9 | 10.5 | 30.7 | 39.1 |
Semiconductors | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 25.5 | 31 | 78 | 89.6 |
Semiconductors | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 25.5 | 31 | 78 | 89.6 |
Semiconductors | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Semiconductors | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 6 | 15.1 | 15.6 | 24.5 |
Other | Sealing Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 1.3 | 11 | 7.1 | 17 |
Other | Engineered Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 4.5 | 3.2 | 8.1 | 5.1 |
Other | Power Systems | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 0.2 | $ 0.9 | $ 0.4 | $ 2.4 |
Derivatives and Hedging (Detail
Derivatives and Hedging (Details) € in Millions, $ in Millions | Sep. 30, 2019USD ($) | May 31, 2019USD ($) | May 31, 2019EUR (€) | Sep. 30, 2018USD ($) | Sep. 30, 2018EUR (€) |
Summary of Credit Derivatives [Abstract] | |||||
Notional amount | $ 100 | $ 200 | |||
Amount of hedged item | € | € 89.6 | € 172.8 | |||
Weighted average interest rate | 3.50% | 3.50% | 2.80% | 2.80% | |
Derivative asset | $ 17.2 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | $ 54.8 | $ 46.5 |
Level 1 | Time deposits | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Time deposits | 27.4 | 33.4 |
Level 1 | Deferred compensation assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Assets measured at fair value | 10.2 | 8.6 |
Liabilities measured at fair value | 10.5 | 8.9 |
Level 2 | Foreign currency derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Foreign currency derivatives | $ 17.2 | $ 4.5 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Carrying Value of Financial Instruments (Detail) - USD ($) $ in Millions | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value Disclosures [Abstract] | ||
Long-term debt, Carrying Value | $ 666.3 | $ 464.9 |
Long-term debt, Fair Value | $ 698.1 | $ 462.1 |
Accumulated Other Comprehensi_3
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, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Accumulated Other Comprehensive Income [Roll Forward] | ||||||||
Beginning balance | $ 876.2 | $ 871.1 | $ 857.7 | $ 864.7 | $ 901.1 | $ 902.8 | $ 857.7 | $ 902.8 |
Other comprehensive income (loss) before reclassifications | 3.9 | 1 | (1.2) | |||||
Amounts reclassified from accumulated other comprehensive loss | 1.3 | 10.8 | 12.9 | |||||
Net current-period other comprehensive income | 5.2 | (2.6) | 6.8 | 11.8 | (9.9) | 9.8 | 11.7 | |
Ending balance | 876.4 | 876.2 | 871.1 | 896.8 | 864.7 | 901.1 | 876.4 | 896.8 |
Unrealized Translation Adjustments | ||||||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||||||
Beginning balance | (8.8) | (10.6) | (9) | (6.8) | (10.6) | (6.8) | ||
Adoption of new accounting standard | 0 | |||||||
Adjusted beginning balance | (10.6) | |||||||
Other comprehensive income (loss) before reclassifications | 3.9 | 3 | 5.7 | 0.8 | ||||
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | 0 | 0 | ||||
Net current-period other comprehensive income | 3.9 | 3 | 5.7 | 0.8 | ||||
Ending balance | (4.9) | (8.8) | (6) | (9) | (4.9) | (6) | ||
Pension and Other Postretirement Plans | ||||||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||||||
Beginning balance | (44) | (34.9) | (39.5) | (41.6) | (34.9) | (41.6) | ||
Adoption of new accounting standard | 11.5 | |||||||
Adjusted beginning balance | (46.4) | |||||||
Other comprehensive income (loss) before reclassifications | 0 | (2) | 0 | (2) | ||||
Amounts reclassified from accumulated other comprehensive loss | 1.3 | 10.8 | 3.7 | 12.9 | ||||
Net current-period other comprehensive income | 1.3 | 8.8 | 3.7 | 10.9 | ||||
Ending balance | (42.7) | (44) | (30.7) | (39.5) | (42.7) | (30.7) | ||
Accumulated Other Comprehensive Loss | ||||||||
Accumulated Other Comprehensive Income [Roll Forward] | ||||||||
Beginning balance | (52.8) | (50.2) | (45.5) | (48.5) | (38.6) | (48.4) | (45.5) | (48.4) |
Adoption of new accounting standard | (11.5) | |||||||
Adjusted beginning balance | (57) | |||||||
Other comprehensive income (loss) before reclassifications | 5.7 | |||||||
Amounts reclassified from accumulated other comprehensive loss | 3.7 | |||||||
Net current-period other comprehensive income | 5.2 | (2.6) | 6.8 | 11.8 | (9.9) | 9.8 | 9.4 | |
Ending balance | $ (47.6) | $ (52.8) | $ (50.2) | $ (36.7) | $ (48.5) | $ (38.6) | $ (47.6) | $ (36.7) |
Accumulated Other Comprehensi_4
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, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||
Actuarial losses | $ (24.6) | $ (13.8) | $ (27.3) | $ (14.4) | ||||
Tax benefit | (1.7) | (0.3) | (17.5) | (16.4) | ||||
Net income (loss) | (1.5) | $ 23.9 | $ 13.1 | 24.2 | $ 9.9 | $ 12.6 | 35.5 | 46.7 |
Amount Reclassified from Accumulated Other Comprehensive Loss | Pension and Other Postretirement Plans | ||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||
Actuarial losses | 1.7 | 1.1 | 5 | 4 | ||||
Prior service costs | 0.1 | 0.1 | 0.2 | 0.2 | ||||
Settlement loss | 0 | 12.8 | 0 | 12.8 | ||||
Total before tax | 1.8 | 14 | 5.2 | 17 | ||||
Tax benefit | (0.5) | (3.2) | (1.5) | (4.1) | ||||
Net income (loss) | $ 1.3 | $ 10.8 | $ 3.7 | $ 12.9 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) € in Millions | Apr. 06, 2017EUR (€) | Sep. 30, 2003sitemi | Oct. 31, 2019USD ($) | Sep. 30, 2019USD ($)sitemi | Dec. 31, 2018USD ($) | Sep. 30, 2018site | Sep. 30, 2017USD ($) | Jun. 30, 2016USD ($)site | Dec. 31, 2015USD ($)site | Jun. 30, 2014USD ($) | Sep. 30, 2019USD ($)sitemi | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2019EUR (€)sitemi | Jan. 31, 2019property | Oct. 31, 2016USD ($) | Mar. 31, 2016USD ($) | Sep. 30, 2015site | Apr. 30, 2015USD ($) | Dec. 31, 2014USD ($) |
Site Contingency [Line Items] | ||||||||||||||||||||
Number of sites subject to remediation | site | 21 | 21 | 21 | |||||||||||||||||
Number of sites, cost in excess of 100K | site | 16 | 16 | 16 | |||||||||||||||||
Cost per site minimis threshold | $ 100,000 | |||||||||||||||||||
Number of sites, discontinued operations | site | 18 | 18 | 18 | |||||||||||||||||
Number of sites, active operations | site | 3 | 3 | 3 | |||||||||||||||||
Number of sites, investigation completed | site | 16 | 16 | 16 | |||||||||||||||||
Number of sites investigation in progress | site | 5 | 5 | 5 | |||||||||||||||||
Number of sites remediation for soil and groundwater contamination | site | 14 | 14 | 14 | |||||||||||||||||
Environmental | $ 34,600,000 | $ 31,100,000 | $ 34,600,000 | $ 31,100,000 | ||||||||||||||||
Number of other potentially responsible parties | site | 70 | 120 | ||||||||||||||||||
Estimate of cost | $ 726,000,000 | |||||||||||||||||||
Estimate low end | $ 165,000,000 | |||||||||||||||||||
Provision for new losses | 1,000,000 | $ 1,900,000 | $ 1,100,000 | $ 1,100,000 | ||||||||||||||||
Investigate sites notice from EPA | site | 6 | |||||||||||||||||||
Investigative sites | site | 8 | |||||||||||||||||||
Accrual component amount | 2,200,000 | 2,200,000 | ||||||||||||||||||
Loss contingency percentage of damages allocated to company | 65.00% | |||||||||||||||||||
Loss contingency percentage of damages allocated to counterparty | 35.00% | |||||||||||||||||||
Estimate of possible loss | € | € 0.4 | |||||||||||||||||||
Estimated insurance recoveries | 25,000,000 | 25,000,000 | ||||||||||||||||||
Insurance recoveries to date | 22,000,000 | |||||||||||||||||||
Estimated recovery for non-GST Trust claimants | 10,000,000 | 10,000,000 | ||||||||||||||||||
Threshold of recovery before shared in trust | 3,000,000 | 3,000,000 | ||||||||||||||||||
Lower Passaic River Study Area, Focused Feasibility Study, April 11, 2014 | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Environmental | 2,800,000 | 2,800,000 | $ 3,500,000 | |||||||||||||||||
Onondaga Site EPA Remedial Investigation | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Environmental | 10,000,000 | 10,000,000 | ||||||||||||||||||
Provision for new losses | 3,500,000 | |||||||||||||||||||
Coltec Industries Inc. | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Environmental | $ 7,500,000 | $ 7,500,000 | $ 1,300,000 | |||||||||||||||||
Provision for new losses | $ 3,500,000 | $ 5,700,000 | ||||||||||||||||||
Minimum | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Portion of site subject to remediation | mi | 8 | 8 | 8 | |||||||||||||||||
Estimate of loss exposure in excess of accrual | € | € 1.8 | |||||||||||||||||||
Loss exposure in excess of accrual | € | 7.9 | |||||||||||||||||||
Estimate of possible loss | € | 5.1 | |||||||||||||||||||
Loss accrual | € | 0.4 | |||||||||||||||||||
Minimum | Lower Passaic River Study Area, Focused Feasibility Study, April 11, 2014 | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Estimate of loss exposure in excess of accrual | $ 953,000,000 | |||||||||||||||||||
Maximum | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Portion of site subject to remediation | mi | 17 | 9 | 9 | 9 | ||||||||||||||||
Estimate of loss exposure in excess of accrual | 2.1 | $ 1,730,000,000 | $ 1,380,000,000 | |||||||||||||||||
Loss exposure in excess of accrual | € | 10.2 | |||||||||||||||||||
Estimate of possible loss | € | € 6.6 | |||||||||||||||||||
Arizona | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Investigate sites notice from EPA | site | 2 | 2 | ||||||||||||||||||
Mississippi | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Provision for new losses | $ 4,400,000 | |||||||||||||||||||
Number of property owners | property | 27 | |||||||||||||||||||
Mississippi | Subsequent Event | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Provision for new losses | $ 3,000,000 | |||||||||||||||||||
Environmental Remediation | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Loss in period | $ 700,000 | |||||||||||||||||||
Asbestos Issue | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Insurance coverage amount | 6,700,000 | 6,700,000 | ||||||||||||||||||
Insurance available for future claims | 6,700,000 | 6,700,000 | ||||||||||||||||||
Estimated insurance recoveries, year one | 4,200,000 | 4,200,000 | ||||||||||||||||||
Estimated insurance recoveries, year two | 2,500,000 | 2,500,000 | ||||||||||||||||||
Asbestos Issue | GST, LLC | ||||||||||||||||||||
Site Contingency [Line Items] | ||||||||||||||||||||
Amount recovered | $ 8,800,000 | $ 8,800,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Changes in Carrying Amount of Product Warranty Liability (Detail) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Balance at beginning of year | $ 11.7 | $ 5.3 |
Net charges to expense | 6.7 | 5.8 |
Settlements made | (4.7) | (2.3) |
Balance at end of year | $ 13.7 | $ 8.8 |
Supplemental Guarantor Financ_3
Supplemental Guarantor Financial Information - Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Condensed Financial Statements, Captions [Line Items] | ||||||||
Net sales | $ 373 | $ 388.2 | $ 1,120.3 | $ 1,150.6 | ||||
Cost of sales | 258 | 264.1 | 767.1 | 785.6 | ||||
Gross profit | 115 | 124.1 | 353.2 | 365 | ||||
Operating expenses: | ||||||||
Selling, general and administrative | 84.1 | 78.9 | 255.7 | 260.4 | ||||
Other | 2.3 | 1 | 4.7 | 6.3 | ||||
Total operating expenses | 86.4 | 79.9 | 260.4 | 266.7 | ||||
Operating income (loss) | 28.6 | 44.2 | 92.8 | 98.3 | ||||
Interest income (expense), net | (3.8) | (5.9) | (12.5) | (20.8) | ||||
Other expense | (24.6) | (13.8) | (27.3) | (14.4) | ||||
Income (loss) before income taxes | 0.2 | 24.5 | 53 | 63.1 | ||||
Tax benefit | (1.7) | (0.3) | (17.5) | (16.4) | ||||
Income (loss) before equity in earnings of subsidiaries | (1.5) | 24.2 | 35.5 | 46.7 | ||||
Equity in earnings of subsidiaries, net of tax | 0 | 0 | 0 | 0 | ||||
Net income (loss) | (1.5) | $ 23.9 | $ 13.1 | 24.2 | $ 9.9 | $ 12.6 | 35.5 | 46.7 |
Comprehensive income | 3.7 | 36 | 44.9 | 58.4 | ||||
Eliminations | ||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||
Net sales | (36.7) | (44.3) | (119.7) | (125.3) | ||||
Cost of sales | (36.7) | (44.3) | (119.7) | (125.3) | ||||
Gross profit | 0 | 0 | 0 | 0 | ||||
Operating expenses: | ||||||||
Selling, general and administrative | 0 | 0 | 0 | 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 | ||||
Tax benefit | 0 | 0 | 0 | 0 | ||||
Income (loss) before equity in earnings of subsidiaries | 0 | 0 | 0 | 0 | ||||
Equity in earnings of subsidiaries, net of tax | (25.1) | (52.7) | (113.4) | (136.1) | ||||
Net income (loss) | (25.1) | (52.7) | (113.4) | (136.1) | ||||
Comprehensive income | (13.8) | (70.9) | (105.8) | (140) | ||||
Parent | Reportable Legal Entities | ||||||||
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 | 11.5 | 11.3 | 35.7 | 34.7 | ||||
Other | 0 | (0.1) | 0.4 | 0 | ||||
Total operating expenses | 11.5 | 11.2 | 36.1 | 34.7 | ||||
Operating income (loss) | (11.5) | (11.2) | (36.1) | (34.7) | ||||
Interest income (expense), net | (3) | (5.4) | (9.4) | (17.6) | ||||
Other expense | 0 | 0 | 0 | 0 | ||||
Income (loss) before income taxes | (14.5) | (16.6) | (45.5) | (52.3) | ||||
Tax benefit | 0 | 2.6 | 3.8 | 10.2 | ||||
Income (loss) before equity in earnings of subsidiaries | (14.5) | (14) | (41.7) | (42.1) | ||||
Equity in earnings of subsidiaries, net of tax | 13 | 38.2 | 77.2 | 88.8 | ||||
Net income (loss) | (1.5) | 24.2 | 35.5 | 46.7 | ||||
Comprehensive income | 3.7 | 36 | 44.9 | 58.4 | ||||
Guarantor Subsidiaries | Reportable Legal Entities | ||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||
Net sales | 266.3 | 279.3 | 799.8 | 810.9 | ||||
Cost of sales | 197.7 | 203.6 | 587.4 | 603.4 | ||||
Gross profit | 68.6 | 75.7 | 212.4 | 207.5 | ||||
Operating expenses: | ||||||||
Selling, general and administrative | 45.1 | 39.1 | 134.3 | 134.7 | ||||
Other | 1.4 | 0.8 | 2 | 5.5 | ||||
Total operating expenses | 46.5 | 39.9 | 136.3 | 140.2 | ||||
Operating income (loss) | 22.1 | 35.8 | 76.1 | 67.3 | ||||
Interest income (expense), net | (1) | (0.6) | (3.9) | (3.7) | ||||
Other expense | (24.5) | (13.7) | (27.1) | (14.1) | ||||
Income (loss) before income taxes | (3.4) | 21.5 | 45.1 | 49.5 | ||||
Tax benefit | 4.3 | 2.2 | (4.1) | (8) | ||||
Income (loss) before equity in earnings of subsidiaries | 0.9 | 23.7 | 41 | 41.5 | ||||
Equity in earnings of subsidiaries, net of tax | 12.1 | 14.5 | 36.2 | 47.3 | ||||
Net income (loss) | 13 | 38.2 | 77.2 | 88.8 | ||||
Comprehensive income | 8 | 51.7 | 73.2 | 96.2 | ||||
Non-guarantor Subsidiaries | Reportable Legal Entities | ||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||
Net sales | 143.4 | 153.2 | 440.2 | 465 | ||||
Cost of sales | 97 | 104.8 | 299.4 | 307.5 | ||||
Gross profit | 46.4 | 48.4 | 140.8 | 157.5 | ||||
Operating expenses: | ||||||||
Selling, general and administrative | 27.5 | 28.5 | 85.7 | 91 | ||||
Other | 0.9 | 0.3 | 2.3 | 0.8 | ||||
Total operating expenses | 28.4 | 28.8 | 88 | 91.8 | ||||
Operating income (loss) | 18 | 19.6 | 52.8 | 65.7 | ||||
Interest income (expense), net | 0.2 | 0.1 | 0.8 | 0.5 | ||||
Other expense | (0.1) | (0.1) | (0.2) | (0.3) | ||||
Income (loss) before income taxes | 18.1 | 19.6 | 53.4 | 65.9 | ||||
Tax benefit | (6) | (5.1) | (17.2) | (18.6) | ||||
Income (loss) before equity in earnings of subsidiaries | 12.1 | 14.5 | 36.2 | 47.3 | ||||
Equity in earnings of subsidiaries, net of tax | 0 | 0 | 0 | 0 | ||||
Net income (loss) | 12.1 | 14.5 | 36.2 | 47.3 | ||||
Comprehensive income | $ 5.8 | $ 19.2 | $ 32.6 | $ 43.8 |
Supplemental Guarantor Financ_4
Supplemental Guarantor Financial Information - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | $ 150.7 | $ 158.4 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (23.8) | (45.7) |
Proceeds from sale of business | 3.6 | 0 |
Acquisitions, net of cash acquired | (310.4) | 0 |
Receipts from settlements of derivative contracts | 0 | 9.3 |
Proceeds from sale of property, plant, and equipment | 0.8 | 26.6 |
Other | (2.9) | (2) |
Net cash used in investing activities | (332.7) | (11.8) |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | 0 | 0 |
Intercompany dividends | 0 | |
Proceeds from debt | 566.9 | 454.9 |
Repayments of debt | (365.1) | (594.4) |
Repurchase of common stock | (15) | (50) |
Dividends paid | (15.7) | (15.3) |
Other | (5) | (6.7) |
Net cash provided by (used in) financing activities | 166.1 | (211.5) |
Effect of exchange rate changes on cash and cash equivalents | (1.6) | (4.5) |
Net decrease in cash and cash equivalents | (17.5) | (69.4) |
Cash and cash equivalents at beginning of period | 129.6 | 189.3 |
Cash and cash equivalents at end of period | 112.1 | 119.9 |
Eliminations | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | (18.5) | (114.3) |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | 0 | 0 |
Proceeds from sale of business | 0 | |
Acquisitions, net of cash acquired | 0 | |
Receipts from settlements of derivative contracts | 0 | |
Proceeds from sale of property, plant, and equipment | 0 | 0 |
Other | 0 | 0 |
Net cash used in investing activities | 0 | 0 |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | 0 | 0 |
Intercompany dividends | 18.5 | 114.3 |
Proceeds from debt | 0 | 0 |
Repayments of debt | 0 | 0 |
Repurchase of common stock | 0 | 0 |
Dividends paid | 0 | 0 |
Other | 0 | 0 |
Net cash provided by (used in) financing activities | 18.5 | 114.3 |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net 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 | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | 83.1 | 69.5 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | 0 | 0 |
Proceeds from sale of business | 0 | |
Acquisitions, net of cash acquired | 0 | |
Receipts from settlements of derivative contracts | 9.3 | |
Proceeds from sale of property, plant, and equipment | 0 | |
Other | 0 | 0 |
Net cash used in investing activities | 0 | 9.3 |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | (47.4) | (8) |
Intercompany dividends | 0 | 0 |
Proceeds from debt | 0 | 0 |
Repayments of debt | 0 | 0 |
Repurchase of common stock | (15) | (50) |
Dividends paid | (15.7) | (15.3) |
Other | (5) | (5.5) |
Net cash provided by (used in) financing activities | (83.1) | (78.8) |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net 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 | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | 30.2 | 145.6 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (17) | (37.5) |
Proceeds from sale of business | 3.6 | |
Acquisitions, net of cash acquired | (271.2) | |
Receipts from settlements of derivative contracts | 0 | |
Proceeds from sale of property, plant, and equipment | 0.4 | 26 |
Other | (2.6) | (1.8) |
Net cash used in investing activities | (286.8) | (13.3) |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | 52.5 | 8.4 |
Intercompany dividends | 0 | 0 |
Proceeds from debt | 566.9 | 454.9 |
Repayments of debt | (365.1) | (594.4) |
Repurchase of common stock | 0 | |
Dividends paid | 0 | |
Other | 0 | (1.2) |
Net cash provided by (used in) financing activities | 254.3 | (132.3) |
Effect of exchange rate changes on cash and cash equivalents | 0 | 0 |
Net decrease in cash and cash equivalents | (2.3) | 0 |
Cash and cash equivalents at beginning of period | 2.3 | 0 |
Cash and cash equivalents at end of period | 0 | 0 |
Non-guarantor Subsidiaries | Reportable Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | 55.9 | 57.6 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (6.8) | (8.2) |
Proceeds from sale of business | 0 | |
Acquisitions, net of cash acquired | (39.2) | |
Receipts from settlements of derivative contracts | 0 | |
Proceeds from sale of property, plant, and equipment | 0.4 | 0.6 |
Other | (0.3) | (0.2) |
Net cash used in investing activities | (45.9) | (7.8) |
FINANCING ACTIVITIES | ||
Net payments on loans between subsidiaries | (5.1) | (0.4) |
Intercompany dividends | (18.5) | (114.3) |
Proceeds from debt | 0 | 0 |
Repayments of debt | 0 | 0 |
Repurchase of common stock | 0 | |
Dividends paid | 0 | |
Other | 0 | 0 |
Net cash provided by (used in) financing activities | (23.6) | (114.7) |
Effect of exchange rate changes on cash and cash equivalents | (1.6) | (4.5) |
Net decrease in cash and cash equivalents | (15.2) | (69.4) |
Cash and cash equivalents at beginning of period | 127.3 | 189.3 |
Cash and cash equivalents at end of period | $ 112.1 | $ 119.9 |
Supplemental Guarantor Financ_5
Supplemental Guarantor Financial Information - Condensed Consolidating Balance Sheets (Details) - USD ($) $ in Millions | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets | ||||||||
Cash and cash equivalents | $ 112.1 | $ 129.6 | ||||||
Accounts receivable, net | 287.1 | 286.6 | ||||||
Intercompany receivables | 0 | 0 | ||||||
Inventories | 225.5 | 233.1 | ||||||
Income tax receivable | 38.5 | 49.6 | ||||||
Prepaid expenses and other current assets | 34.4 | 33.2 | ||||||
Total current assets | 697.6 | 732.1 | ||||||
Property, plant and equipment, net | 284.9 | 301.2 | ||||||
Goodwill | 485 | 333.7 | ||||||
Other intangible assets, net | 494.3 | 297.3 | ||||||
Intercompany receivables | 0 | 0 | ||||||
Investment in subsidiaries | 0 | 0 | ||||||
Other assets | 107.9 | 51.5 | ||||||
Total assets | 2,069.7 | 1,715.8 | ||||||
Current liabilities | ||||||||
Current maturities of long-term debt | 0.4 | 2.4 | ||||||
Accounts payable | 105.6 | 139.2 | ||||||
Intercompany payables | 0 | 0 | ||||||
Accrued expenses | 200.8 | 150.4 | ||||||
Total current liabilities | 306.8 | 292 | ||||||
Long-term debt | 665.9 | 462.5 | ||||||
Intercompany payables | 0 | 0 | ||||||
Other liabilities | 192.6 | 103.6 | ||||||
Total liabilities | 1,165.3 | 858.1 | ||||||
Redeemable non-controlling interest | 28 | 0 | ||||||
Shareholders’ equity | 876.4 | $ 876.2 | $ 871.1 | 857.7 | $ 896.8 | $ 864.7 | $ 901.1 | $ 902.8 |
Total liabilities and equity | 2,069.7 | 1,715.8 | ||||||
Eliminations | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 0 | 0 | ||||||
Accounts receivable, net | 0 | 0 | ||||||
Intercompany receivables | (28.2) | (27.9) | ||||||
Inventories | 0 | 0 | ||||||
Income tax receivable | 0 | 0 | ||||||
Prepaid expenses and other current assets | 0 | 0 | ||||||
Total current assets | (28.2) | (27.9) | ||||||
Property, plant and equipment, net | 0 | 0 | ||||||
Goodwill | 0 | 0 | ||||||
Other intangible assets, net | 0 | 0 | ||||||
Intercompany receivables | (7.9) | (53.9) | ||||||
Investment in subsidiaries | (1,884.1) | (1,634.1) | ||||||
Other assets | 0 | 0 | ||||||
Total assets | (1,920.2) | (1,715.9) | ||||||
Current liabilities | ||||||||
Current maturities of long-term debt | 0 | 0 | ||||||
Accounts payable | 0 | 0 | ||||||
Intercompany payables | (28.2) | (27.9) | ||||||
Accrued expenses | 0 | 0 | ||||||
Total current liabilities | (28.2) | (27.9) | ||||||
Long-term debt | 0 | 0 | ||||||
Intercompany payables | (7.9) | (53.9) | ||||||
Other liabilities | 0 | 0 | ||||||
Total liabilities | (36.1) | (81.8) | ||||||
Redeemable non-controlling interest | 0 | |||||||
Shareholders’ equity | (1,884.1) | (1,634.1) | ||||||
Total liabilities and equity | (1,920.2) | (1,715.9) | ||||||
Parent | ||||||||
Current liabilities | ||||||||
Redeemable non-controlling interest | 0 | |||||||
Parent | Reportable Legal Entities | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 0 | 0 | ||||||
Accounts receivable, net | 0.2 | 0 | ||||||
Intercompany receivables | 0 | 0 | ||||||
Inventories | 0 | 0 | ||||||
Income tax receivable | 27.3 | 42.9 | ||||||
Prepaid expenses and other current assets | 5.7 | 4.9 | ||||||
Total current assets | 33.2 | 47.8 | ||||||
Property, plant and equipment, net | 0 | 2.2 | ||||||
Goodwill | 0 | 0 | ||||||
Other intangible assets, net | 0 | 0 | ||||||
Intercompany receivables | 0 | 0 | ||||||
Investment in subsidiaries | 1,218.7 | 1,246.4 | ||||||
Other assets | 31.9 | 13.6 | ||||||
Total assets | 1,283.8 | 1,310 | ||||||
Current liabilities | ||||||||
Current maturities of long-term debt | 0 | 2.1 | ||||||
Accounts payable | 2 | 2.1 | ||||||
Intercompany payables | 0 | 0 | ||||||
Accrued expenses | 20.5 | 13.9 | ||||||
Total current liabilities | 22.5 | 18.1 | ||||||
Long-term debt | 345.2 | 345 | ||||||
Intercompany payables | 3.7 | 51.1 | ||||||
Other liabilities | 36 | 38.1 | ||||||
Total liabilities | 407.4 | 452.3 | ||||||
Shareholders’ equity | 876.4 | 857.7 | ||||||
Total liabilities and equity | 1,283.8 | 1,310 | ||||||
Guarantor Subsidiaries | ||||||||
Current liabilities | ||||||||
Redeemable non-controlling interest | 28 | |||||||
Guarantor Subsidiaries | Reportable Legal Entities | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 0 | 2.3 | ||||||
Accounts receivable, net | 200.3 | 210.3 | ||||||
Intercompany receivables | 16.8 | 19 | ||||||
Inventories | 153.3 | 155.3 | ||||||
Income tax receivable | 0.3 | 0.3 | ||||||
Prepaid expenses and other current assets | 22.1 | 20.3 | ||||||
Total current assets | 392.8 | 407.5 | ||||||
Property, plant and equipment, net | 195.6 | 209.7 | ||||||
Goodwill | 291.1 | 261 | ||||||
Other intangible assets, net | 232.7 | 242.2 | ||||||
Intercompany receivables | 2.8 | 53.9 | ||||||
Investment in subsidiaries | 665.4 | 387.7 | ||||||
Other assets | 39.6 | 25.3 | ||||||
Total assets | 1,820 | 1,587.3 | ||||||
Current liabilities | ||||||||
Current maturities of long-term debt | 0.4 | 0.3 | ||||||
Accounts payable | 71.4 | 99 | ||||||
Intercompany payables | 11.4 | 8.9 | ||||||
Accrued expenses | 112.9 | 82.8 | ||||||
Total current liabilities | 196.1 | 191 | ||||||
Long-term debt | 320.4 | 117.5 | ||||||
Intercompany payables | 1.4 | 0 | ||||||
Other liabilities | 55.4 | 32.4 | ||||||
Total liabilities | 573.3 | 340.9 | ||||||
Shareholders’ equity | 1,218.7 | 1,246.4 | ||||||
Total liabilities and equity | 1,820 | 1,587.3 | ||||||
Non-guarantor Subsidiaries | ||||||||
Current liabilities | ||||||||
Redeemable non-controlling interest | 0 | |||||||
Non-guarantor Subsidiaries | Reportable Legal Entities | ||||||||
Current assets | ||||||||
Cash and cash equivalents | 112.1 | 127.3 | ||||||
Accounts receivable, net | 86.6 | 76.3 | ||||||
Intercompany receivables | 11.4 | 8.9 | ||||||
Inventories | 72.2 | 77.8 | ||||||
Income tax receivable | 10.9 | 6.4 | ||||||
Prepaid expenses and other current assets | 6.6 | 8 | ||||||
Total current assets | 299.8 | 304.7 | ||||||
Property, plant and equipment, net | 89.3 | 89.3 | ||||||
Goodwill | 193.9 | 72.7 | ||||||
Other intangible assets, net | 261.6 | 55.1 | ||||||
Intercompany receivables | 5.1 | 0 | ||||||
Investment in subsidiaries | 0 | 0 | ||||||
Other assets | 36.4 | 12.6 | ||||||
Total assets | 886.1 | 534.4 | ||||||
Current liabilities | ||||||||
Current maturities of long-term debt | 0 | 0 | ||||||
Accounts payable | 32.2 | 38.1 | ||||||
Intercompany payables | 16.8 | 19 | ||||||
Accrued expenses | 67.4 | 53.7 | ||||||
Total current liabilities | 116.4 | 110.8 | ||||||
Long-term debt | 0.3 | 0 | ||||||
Intercompany payables | 2.8 | 2.8 | ||||||
Other liabilities | 101.2 | 33.1 | ||||||
Total liabilities | 220.7 | 146.7 | ||||||
Shareholders’ equity | 665.4 | 387.7 | ||||||
Total liabilities and equity | $ 886.1 | $ 534.4 |