Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Feb. 05, 2015 | Jun. 30, 2014 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | ALSN | ||
Entity Registrant Name | ALLISON TRANSMISSION HOLDINGS INC | ||
Entity Central Index Key | 1411207 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 180,053,650 | ||
Entity Public Float | $5,148,600,000 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Current Assets | ||
Cash and cash equivalents | $263 | $184.70 |
Accounts receivable - net of allowance for doubtful accounts of $0.3 and $0.4, respectively | 207.4 | 175.1 |
Inventories | 143.5 | 160.4 |
Deferred income taxes, net | 119.7 | 58.1 |
Other current assets | 24.4 | 28.6 |
Total Current Assets | 758 | 606.9 |
Property, plant and equipment, net | 514.6 | 563.4 |
Intangible assets, net | 1,512 | 1,610.80 |
Goodwill | 1,941 | 1,941 |
Deferred income taxes, net | 1.3 | 1.1 |
Other non-current assets | 77.3 | 89.4 |
TOTAL ASSETS | 4,804.20 | 4,812.60 |
Current Liabilities | ||
Accounts payable | 151.7 | 150.4 |
Product warranty liability | 24 | 37.4 |
Current portion of long-term debt | 17.9 | 17.9 |
Deferred revenue | 20.6 | 29.2 |
Other current liabilities | 131.7 | 152.3 |
Total Current Liabilities | 345.9 | 387.2 |
Product warranty liability | 59.6 | 53.1 |
Deferred revenue | 48.7 | 43.2 |
Long-term debt | 2,502.60 | 2,660.40 |
Deferred income taxes | 238.2 | 76.2 |
Other non-current liabilities | 211.4 | 153.7 |
TOTAL LIABILITIES | 3,406.40 | 3,373.80 |
Commitments and contingencies (see NOTE 17) | ||
STOCKHOLDERS' EQUITY | ||
Preferred stock, $0.01 par value, 100,000,000 shares authorized, none issued and outstanding | ||
Paid in capital | 1,651 | 1,631.80 |
Accumulated deficit | -215.5 | -173.8 |
Accumulated other comprehensive loss, net of tax | -39.5 | -21 |
TOTAL STOCKHOLDERS' EQUITY | 1,397.80 | 1,438.80 |
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | 4,804.20 | 4,812.60 |
Common Stock | ||
STOCKHOLDERS' EQUITY | ||
Common stock | 1.8 | 1.8 |
Non-voting Common Stock | ||
STOCKHOLDERS' EQUITY | ||
Common stock | $0 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, except Share data, unless otherwise specified | ||
Allowance for doubtful accounts receivables | $0.30 | $0.40 |
Preferred stock, par value | $0.01 | $0.01 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common Stock | ||
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 1,880,000,000 | 1,880,000,000 |
Common stock, shares issued | 179,488,247 | 183,375,436 |
Common stock, shares outstanding | 179,488,247 | 183,375,436 |
Non-voting Common Stock | ||
Common stock, par value | $0.01 | $0.01 |
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, shares issued | 0 | 1,185 |
Common stock, shares outstanding | 0 | 1,185 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Net sales | $2,127.40 | $1,926.80 | $2,141.80 |
Cost of sales | 1,151.50 | 1,084.90 | 1,187.50 |
Gross profit | 975.9 | 841.9 | 954.3 |
Selling, general and administrative expenses | 344.6 | 334.9 | 419 |
Engineering - research and development | 103.8 | 97.1 | 115.1 |
Loss associated with impairment of long-lived assets | 15.4 | ||
Operating income | 512.1 | 409.9 | 420.2 |
Interest income | 0.9 | 0.8 | 0.9 |
Interest expense | -139.3 | -133.7 | -152.1 |
Other expense, net | -5.6 | -10.9 | -52.8 |
Income before income taxes | 368.1 | 266.1 | 216.2 |
Income tax (expense) benefit | -139.5 | -100.7 | 298 |
Net income | 228.6 | 165.4 | 514.2 |
Basic earnings per share attributable to common stockholders | $1.27 | $0.90 | $2.83 |
Diluted earnings per share attributable to common stockholders | $1.25 | $0.88 | $2.76 |
Dividends declared per common share | $0.51 | $0.42 | $0.18 |
Other comprehensive (loss) income, net of tax: | |||
Foreign currency translation | -7.4 | -5 | -0.7 |
Pension and OPEB liability adjustment | -9.1 | 29 | 15.1 |
Available-for-sale securities | -2 | -1.1 | -1.3 |
Total other comprehensive (loss) income, net of tax | -18.5 | 22.9 | 13.1 |
Comprehensive income | $210.10 | $188.30 | $527.30 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | $228.60 | $165.40 | $514.20 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Amortization of intangible assets | 98.8 | 105.3 | 150 |
Depreciation of property, plant and equipment | 93.8 | 98.7 | 102.5 |
Deferred income taxes | 131.8 | 98 | -303.8 |
Excess tax benefit from stock-based compensation | -24.6 | -13.7 | -5.3 |
Loss associated with impairment of long-lived assets | 15.4 | ||
Stock-based compensation | 14.7 | 13.7 | 6.4 |
Amortization of deferred financing costs | 8.1 | 10.9 | 14.5 |
Unrealized gain on derivatives | -4.7 | -32.8 | -26.2 |
Impairment loss on investments in technology-related initiatives | 2 | 5 | 14.4 |
Loss on repayments and repurchases of long-term debt | 0.5 | 0.8 | 22.1 |
Other | 5.2 | 2.1 | 2.1 |
Changes in assets and liabilities: | |||
Accounts receivable | -35.8 | -9.9 | 29.9 |
Inventories | 12.7 | -4.4 | -1.8 |
Accounts payable | 2.1 | 17.6 | -29.4 |
Other assets and liabilities | 8.3 | -3.2 | 7.9 |
Net cash provided by operating activities | 556.9 | 453.5 | 497.5 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Additions of long-lived assets | -64.1 | -74.4 | -123.9 |
Investments in technology-related initiatives | -5.8 | -8.8 | -14.4 |
Collateral for interest rate derivatives | 1.7 | 1.2 | -1 |
Proceeds from disposal of assets | 0.3 | 0.5 | 0.6 |
Net cash used for investing activities | -67.9 | -81.5 | -138.7 |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Repurchase of common stock | -249.8 | -99.5 | |
Payments on long-term debt | -157.6 | -142.4 | -245.4 |
Dividend payments | -91.6 | -77.1 | -32.8 |
Proceeds from exercise of stock options | 59.6 | 46.3 | 29 |
Excess tax benefit from stock-based compensation | 24.6 | 13.7 | 5.3 |
Taxes paid related to net share settlement of equity awards | -8.4 | -3.6 | |
Debt financing costs | -0.9 | -14.9 | -20.2 |
Repurchases of long-term debt | -326.9 | ||
Payments on notes payable | -2.5 | ||
Net cash used for financing activities | -424.1 | -277.5 | -593.5 |
Effect of exchange rate changes on cash | 13.4 | 10 | 0.9 |
Net increase (decrease) during period | 78.3 | 104.5 | -233.8 |
Cash and cash equivalents at beginning of period | 184.7 | 80.2 | 314 |
Cash and cash equivalents at end of period | 263 | 184.7 | 80.2 |
Supplemental disclosures: | |||
Interest paid | 140 | 159.2 | 167.3 |
Income taxes paid | $5 | $3.80 | $10.70 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock | Non-voting Common Stock | Treasury Stock | Paid-in Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss), net of tax |
In Millions | |||||||
Stockholders Equity, Beginning Balance at Dec. 31, 2011 | $821.70 | $1.80 | $0 | ($0.20) | $1,560.80 | ($683.70) | ($57) |
Stock-based compensation | 6.4 | 6.4 | |||||
Pension and OPEB liability adjustment | 15.1 | 15.1 | |||||
Foreign currency translation adjustment | -0.7 | -0.7 | |||||
Available-for-sale securities | -1.3 | -1.3 | |||||
Issuance of common stock | 29 | 0 | 29 | ||||
Dividends on common stock | -32.8 | -32.8 | |||||
Excess tax benefit from stock-based compensation | 5.3 | 5.3 | |||||
Net income | 514.2 | 514.2 | |||||
Stockholders Equity, Ending Balance at Dec. 31, 2012 | 1,356.90 | 1.8 | 0 | -0.2 | 1,601.50 | -202.3 | -43.9 |
Stock-based compensation | 13.7 | 13.7 | |||||
Pension and OPEB liability adjustment | 29 | 29 | |||||
Foreign currency translation adjustment | -5 | -5 | |||||
Available-for-sale securities | -1.1 | -1.1 | |||||
Issuance of common stock | 42.6 | 0 | 42.6 | ||||
Repurchase of common stock | -99.5 | 0 | -39.7 | -59.8 | |||
Retirement of treasury stock | 0.2 | 0.2 | |||||
Dividends on common stock | -77.1 | -77.1 | |||||
Excess tax benefit from stock-based compensation | 13.7 | 13.7 | |||||
Net income | 165.4 | 165.4 | |||||
Stockholders Equity, Ending Balance at Dec. 31, 2013 | 1,438.80 | 1.8 | 0 | 1,631.80 | -173.8 | -21 | |
Stock-based compensation | 14.7 | 14.7 | |||||
Pension and OPEB liability adjustment | -9.1 | -9.1 | |||||
Foreign currency translation adjustment | -7.4 | -7.4 | |||||
Available-for-sale securities | -2 | -2 | |||||
Issuance of common stock | 51 | 0 | 51 | ||||
Repurchase of common stock | -249.8 | 0 | 0 | -71.1 | -178.7 | ||
Dividends on common stock | -91.6 | -91.6 | |||||
Excess tax benefit from stock-based compensation | 24.6 | 24.6 | |||||
Net income | 228.6 | 228.6 | |||||
Stockholders Equity, Ending Balance at Dec. 31, 2014 | $1,397.80 | $1.80 | $1,651 | ($215.50) | ($39.50) |
OVERVIEW
OVERVIEW | 12 Months Ended | |
Dec. 31, 2014 | ||
OVERVIEW | NOTE 1. | OVERVIEW |
Overview | ||
Allison Transmission Holdings, Inc. and its subsidiaries (“Allison,” the “Company” or “we”) design and manufacture commercial and defense fully-automatic transmissions. The business was founded in 1915 and has been headquartered in Indianapolis, Indiana since inception. Allison was an operating unit of General Motors Corporation (“Old GM”) from 1929 until 2007, when Allison once again became a stand-alone company. In March 2012, Allison began trading on the New York Stock Exchange under the symbol, “ALSN”. | ||
We have approximately 2,700 employees and 13 different transmission product lines. Although approximately 80% percent of revenues were generated in North America in 2014, we have a global presence by serving customers in Europe, Asia, South America and Africa. We serve customers through an independent network of approximately 1,400 independent distributor and dealer locations worldwide. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||
Dec. 31, 2014 | |||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Basis of Presentation and Principles of Consolidation | |||
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The information herein reflects all normal recurring material adjustments, which are, in the opinion of management, necessary for the fair statements of the results for the periods presented. The consolidated financial statements herein consist of all wholly-owned domestic and foreign subsidiaries with all significant intercompany transactions eliminated. | |||
These consolidated financial statements present the financial position, results of comprehensive income, cash flows and statements of equity. Certain immaterial reclassifications have been made in the consolidated financial statements of prior periods to conform to the current period presentation. These reclassifications have no impact on previously reported net income, total stockholders’ equity or cash flows. | |||
Use of Estimates | |||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses. Significant estimates include, but are not limited to, allowance for doubtful accounts, sales allowances, government price adjustments, fair market values and future cash flows associated with goodwill, indefinite-life intangibles, long-lived asset impairment tests, useful lives for depreciation and amortization, warranty liability, determination of discount and other assumptions for pension and other postretirement benefit expense, income taxes and deferred tax valuation allowances, derivative valuation, and contingencies. The Company’s accounting policies involve the application of judgments and assumptions made by management that include inherent risks and uncertainties. Actual results could differ materially from these estimates. Changes in estimates are recorded in results of operations in the period that the events or circumstances giving rise to such changes occur. | |||
Segment Reporting | |||
In accordance with the Financial Accounting Standards Board (“FASB”) authoritative accounting guidance on segment reporting, the Company has one operating segment and reportable segment. The Company is in one line of business, which is the manufacture and distribution of fully-automatic transmissions. | |||
Government Grants | |||
The Company recognizes government grants when there is reasonable assurance that the Company will comply with the conditions attached to the grant arrangement and the funds will be received. When the government grants relate to reimbursement of costs, the grant income is recognized in Other expense, net in the Consolidated Statements of Comprehensive Income. When the government grants relate to a reimbursement of capital expenditures, the grants are recognized as a reduction of the basis of the assets in the Consolidated Balance Sheets. | |||
Cash and Cash Equivalents | |||
Cash equivalents are defined as short-term, highly-liquid investments with original maturities of 90 days or less. Under the Company’s cash management system, checks issued but not presented to banks may result in book overdraft balances for accounting purposes and are classified within Accounts payable in the Consolidated Balance Sheets. The change in book overdrafts is reported as a component of operating cash flows for Accounts payable. | |||
Marketable Securities | |||
The Company determines the appropriate classification of all marketable securities as “held-to-maturity,” “available-for-sale” or “trading” at the time of purchase, and re-evaluates such classifications as of each balance sheet date. As of December 31, 2014, the Company’s marketable securities are classified as either available-for-sale or trading. | |||
Available-for-sale securities are carried at fair value with the unrealized gain or loss reported in Accumulated other comprehensive loss (“AOCL”). Unrealized gains or losses considered to be “other-than-temporary” are recognized in income. Trading securities are carried at fair value with the unrealized gain or loss recognized in Other expense, net. The fair value of the Company’s investment securities is determined by currently available market prices. See NOTE 6 for more details. | |||
Allowance for Doubtful Accounts | |||
The allowance for doubtful trade accounts receivable reflects estimated losses to be incurred in the collection of the receivables. Estimated losses are based on historical collection experience as well as a review by management of the current status of all receivables. Account balances are charged against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. | |||
Inventories | |||
Inventories are stated at the lower of cost or market. The Company determines cost using the first-in, first-out method. The Company analyzes inventory on a quarterly basis to determine whether it is excess or obsolete inventory. Any decline in carrying value of estimated excess or obsolete inventory is recorded as a reduction of inventory and as an expense included in Cost of sales in the period it is identified. | |||
Property, Plant and Equipment | |||
Property, plant and equipment are recorded at cost less accumulated depreciation. Depreciation expense is recorded using the straight-line method over the following estimated lives: | |||
Range in Years | |||
Land improvements | 5 – 30 | ||
Buildings and building improvements | 10 – 40 | ||
Machinery and equipment | 2 – 20 | ||
Software | 2 – 5 | ||
Special tools | 2 – 10 | ||
Software represents the costs of software developed or obtained for internal use. Software costs are amortized on a straight-line basis over their estimated useful lives. Software assets are reviewed for impairment when events or circumstances indicate that the carrying value may not be recoverable over the remaining lives of the assets. Upgrades and enhancements are capitalized if they result in added functionality, which enables the software to perform tasks it was previously incapable of performing. Software maintenance, training, data conversion and business process reengineering costs are expensed in the period in which they are incurred. | |||
Special tooling represents the costs to design and develop tools, dies, jigs and other items owned by the Company and used in the manufacture of components by suppliers under long-term supply agreements. Special tooling is depreciated over the tool’s expected life. Special tooling used in the development of new technology is expensed as incurred. Engineering, testing and other costs incurred in the design and development of production parts are expensed as incurred. | |||
Impairment of Long-Lived Assets | |||
The carrying value of long-lived assets is evaluated whenever events or circumstances indicate that the carrying value of an asset may not be recoverable. Events or circumstances that would result in an impairment review primarily include a significant change in the use of an asset, or the planned sale or disposal of an asset. The asset would be considered impaired when there is no future use planned for the asset or the future net undiscounted cash flows generated by the asset or asset group are less than its carrying value. An impairment loss would be recognized based on the amount by which the carrying value exceeds fair value. | |||
Assumptions and estimates used to determine cash flows in the evaluation of impairment and the fair values used to determine the impairment are subject to a degree of judgment and complexity. Any changes to the assumptions and estimates resulting from changes in actual results or market conditions from those anticipated may affect the carrying value of long-lived assets and could result in an impairment charge. | |||
As a result of events and circumstances in the fourth quarter of 2014, the Company reviewed certain of its long-lived assets related to the production of the H3000 and H4000 hybrid-propulsion systems, resulting in a $15.4 million loss recorded for the year ended December 31, 2014. The loss, determined by using future net discounted cash flows, included approximately $1.7 million of accrued expenses related to the impairment of the long-lived assets. Deteriorating market conditions for hybrid-propulsion vehicles, principally as a result of decreased fuel costs, alternative fuels and other technologies, significantly contributed to the future cash flows of the related assets being less than the carrying value of those assets. | |||
Goodwill and Other Intangible Assets | |||
Goodwill represents the excess of purchase price paid over the fair value of net assets acquired. In accordance with the FASB’s authoritative accounting guidance on goodwill, the Company does not amortize goodwill but rather evaluates it for impairment on an annual basis, or more often if events or circumstances change that could cause goodwill to become impaired. Goodwill is tested for impairment at the reporting unit level, which is the same as the Company’s one operating and reportable segment. The Company has elected to perform its annual impairment test on October 31 of every year. A multi-step impairment test is performed on goodwill. In Step 0, the Company has the option to evaluate various qualitative factors to determine the likelihood of impairment. If determined that the fair value is more likely than not less than the carrying value, then the Company is required to perform Step 1. If the Company does not elect to perform Step 0, it can voluntarily proceed directly to Step 1. In Step 1, the Company performs a quantitative analysis to compare the fair value of its reporting unit to its carrying value including goodwill. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that unit, goodwill is not considered impaired, and the Company is not required to perform further testing. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then the Company must perform Step 2 of the impairment test in order to determine the implied fair value of the reporting unit’s goodwill. If the carrying value of a reporting unit’s goodwill exceeds its implied fair value, then the Company would record an impairment loss equal to the difference. | |||
Goodwill impairment testing for 2014 was performed by assessing certain qualitative trends and factors. The Company’s qualitative assessment included an assessment of business changes, economic outlook, financial trends and forecasts, growth rates, credit ratings, equity ratings, discount rates, industry data and other relevant qualitative factors. Events or circumstances that could unfavorably impact the key assumptions include lower net sales driven by market conditions, our inability to execute on marketing programs and/or delay in the introduction of new products, lower gross margins as a result of market conditions or failure to obtain forecasted cost reductions, or a higher discount rate as a result of market conditions. While unpredictable and inherently uncertain, the Company believes its forecast estimates are reasonable and incorporate assumptions that similar market participants would use in their estimates of fair value. These trends and factors were compared to, and based on, the assumptions used in the quantitative assessment performed in 2013. After reviewing various qualitative factors, the Company’s 2014 annual goodwill impairment test indicated that the fair value of the reporting unit more likely than not exceeded its carrying value, indicating no impairment. | |||
Other intangible assets have both indefinite and finite useful lives. Intangible assets with indefinite useful lives, such as the Company’s trade name, are not amortized but are tested annually for impairment. The Company has elected to perform our annual trade name impairment test on October 31 of every year and follow a similar multi-step impairment test that is performed on goodwill. After reviewing various qualitative factors, the Company’s 2014 annual trade name impairment test indicated that the fair value of the trade name more likely than not exceeded its carrying value, indicating no impairment. The qualitative review included an assessment of various key assumptions and factors including, among others, an assessment of business changes, economic outlooks, financial trends and forecasts, royalty savings rates, credit ratings, equity ratings and discount rates. Events or circumstances that could unfavorably impact the key assumptions include lower net sales driven by market conditions, our inability to execute on marketing programs and/or delay in introduction of new products, and higher discount rate as a result of market conditions. While unpredictable and inherently uncertain, we believe the forecast estimates are reasonable and incorporate those assumptions that similar market participants would use in their estimates of fair value. These trends and factors were compared to, and based on, the assumptions used in the quantitative assessment performed in 2013. After reviewing various qualitative factors, the fair value of trade name exceeded the respective carrying value. | |||
Intangible assets with finite lives are amortized over their estimated useful lives and reviewed for impairment when circumstances change that would create a triggering event. Customer relationships are amortized over the life in which expected benefits are to be consumed. The other remaining finite useful life intangibles are amortized on a straight-line basis over their useful lives. The Company evaluates the remaining useful life of the other intangible assets on a periodic basis to determine whether events or circumstances warrant a revision to the remaining useful life. Assumptions and estimates about future values and remaining useful lives of the Company’s intangible and other long-lived assets are complex and subjective. They can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors, such as changes in the Company’s business strategy and internal forecasts. Although management believes the historical assumptions and estimates are reasonable and appropriate, different assumptions and estimates could materially impact the Company’s reported financial results. | |||
NOTE 5 provides further information on Goodwill and Other intangible assets. | |||
Deferred Financing Costs | |||
Deferred financing costs are stated at cost as a component of other non-current assets and amortized over the life of the related debt using the effective interest method. Amortization of deferred financing costs is recorded as part of interest expense and totaled $8.1 million, $10.9 million and $14.5 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||
Financial Instruments | |||
The Company’s cash equivalents are invested in U.S. Government backed securities and recorded at fair value in the Consolidated Balance Sheets. The carrying values of accounts receivable and accounts payable approximate fair value due to their short-term nature. The Company’s financial derivative instruments, including interest rate swaps and foreign currency and commodity forward contracts are carried at fair value on the Consolidated Balance Sheets. Refer to NOTE 6 for more detail. The Company’s long-term debt obligations are carried at historical amounts with the Company providing fair value disclosure in NOTE 7. | |||
Insurable Liabilities | |||
The Company records liabilities for its medical, workers’ compensation, long-term disability, product, general and auto liabilities. The determination of these liabilities and related expenses is dependent on claims experience. For most of these liabilities, claims incurred but not yet reported are estimated based upon historical claims experience. | |||
Revenue Recognition | |||
The Company records sales when title has transferred to the customer, there is evidence of an agreement, the sales price is fixed or determinable, delivery has occurred or services have been rendered, and collectability is reasonably assured. The Company sells Extended Transmission Coverage (“ETC”) for which sales are deferred. ETC sales are recognized ratably over the period of the ETC, which typically ranges from two to five years after initial sale. Costs associated with ETC programs are recorded as incurred during the extended period. Distributor and customer sales incentives, consisting of allowances and other rebates, are estimated at the time of sale based upon the Company’s history and experience and are recorded as a reduction to Net sales. Incentive programs are generally product specific or region specific. Some factors used in estimating the cost of incentives include the number of transmissions that will be affected by the incentive program and rate of acceptance of any incentive program. If the actual number of affected transmissions differs from this estimate, or if a different mix of incentives is actually paid, the impact on Net sales would be recorded in the period that the change was identified. Consideration given to commercial customers recorded as a reduction of Net sales in the Consolidated Statements of Comprehensive Income included $66.9 million, $65.2 million, and $59.9 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||
Sales under U.S. government production contracts are recorded when the product is accepted, title has transferred to the U.S. government, the sales price is fixed or determinable, and delivery has occurred. Deferred revenue arises from cash received in advance of the culmination of the earnings process and is recognized as revenue in future periods when the applicable revenue recognition criteria have been met. Under the terms of the U.S. government contracts, there are certain price reduction clauses and provisions for potential price reductions which are estimated at the time of sale based upon the Company’s history and experience and are recorded as a reduction to Net sales. Potential reductions may be attributed to a change in projected sales volumes or plant efficiencies which impact overall costs. As of December 31, 2014 and 2013, the Company had $63.1 million and $49.6 million recorded in the price reduction reserve account, respectively. | |||
Due to requests from the U.S. government, the Company billed, but did not ship certain tracked transmissions during 2013. Based on the lack of a fixed delivery date from the U.S. government, the Company deferred approximately $8.8 million of net sales for these transmissions until they were shipped in 2014. See NOTE 10 for additional details. | |||
The Company classifies shipping and handling billed to customers in Net sales and shipping and handling costs in Cost of sales, in accordance with authoritative accounting guidance. | |||
The Company contracts with various third parties to provide engineering services. These services are recorded as Net sales in accordance with the terms of the contract. The saleable engineering recorded was $7.4 million, 12.4 million and $7.8 million for the years ended December 31, 2014, 2013 and 2012, respectively. The associated costs are recorded in Cost of sales. | |||
Warranty | |||
Provisions for estimated expenses related to product warranties are made at the time products are sold. Warranty claims arise when a transmission fails while in service during the relevant warranty period. The warranty reserve is adjusted in Selling, general and administrative expenses based on the Company’s current and historical warranty claims paid and associated repair costs. These estimates are established using historical information including the nature, frequency, and average cost of warranty claims and are adjusted as actual information becomes available. From time to time, the Company may initiate a specific field action program. As a result of the uncertainty surrounding the nature and frequency of specific field action programs, the liability for such programs is recorded when the Company commits to an action. The Company reviews and assesses the liability for these programs on a quarterly basis. The Company also assesses its ability to recover certain costs from its suppliers and records a receivable from the supplier when it believes a recovery is probable. | |||
Research and Development | |||
The Company incurs costs in connection with research and development programs that are expected to contribute to future earnings. Such costs are charged to Engineering — research and development as incurred. | |||
Foreign Currency Translation | |||
Most of the subsidiaries outside the United States prepare financial statements in currencies other than the U.S. dollar. The functional currency for all these subsidiaries is the local currency, except for the Company’s Hong Kong and Middle East subsidiaries which currently use the U.S. dollar as their functional currency. Balances are translated at period-end exchange rates for assets and liabilities and monthly weighted-average exchange rates for revenues and expenses. The translation gains (losses) are stated as a component of AOCL as disclosed in NOTE 16. | |||
Derivative Instruments | |||
In the normal course of business, the Company is exposed to fluctuations in interest rates, foreign currency exchange rates, and commodity prices. The risk is managed through the use of financial derivative instruments including interest rate swaps and commodity and foreign currency forward contracts. Despite the fact that the Company either has not elected or does not qualify for hedge accounting treatment on all of its derivative instruments, the contracts are used strictly as an economic hedge and not for speculative purposes. As necessary, the Company adjusts the values of the derivative instruments for counter-party or credit risk. NOTE 8 provides further information on the accounting treatment of the Company’s derivative instruments. | |||
Income Taxes | |||
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. The future tax benefits associated with operating loss and tax credit carryforwards are recognized as deferred tax assets. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. | |||
The need to establish a valuation allowance against the deferred tax assets is assessed periodically based on a more-likely-than-not realization threshold, in accordance with the FASB’s authoritative accounting guidance on income taxes. Appropriate consideration is given to all positive and negative evidence related to that realization. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward periods, and experience with tax attributes expiring unused and tax planning alternatives. The weight given to these considerations depends upon the degree to which they can be objectively verified. | |||
Stock-Based Compensation | |||
The Company maintains a stock-based compensation plan which allows employees (including executive officers), consultants and directors to receive equity awards. The Company has adopted the FASB’s authoritative accounting guidance on share-based payments and recognizes the fair value of the awards as compensation expense over the vesting period. The accounting guidance also requires that forfeitures be estimated over the vesting period of an award instead of being recognized as a reduction of compensation expense when the forfeiture actually occurs. | |||
Pension and Post-retirement Benefit Plans | |||
For pension and other post-retirement benefits (“OPEB”) plans in which employees participate, costs are determined within the FASB’s authoritative accounting guidance set forth in employers’ defined benefit pensions including accounting for settlements and curtailments of defined benefit pension plans, termination of benefits and accounting for post-retirement benefits other than pensions. In accordance with the authoritative accounting guidance, the Company recognizes the funded status of its defined benefit pension plans and OPEB plan in its Consolidated Balance Sheets with a corresponding adjustment to AOCL, net of tax. | |||
Post-retirement benefit costs consist of service cost, interest cost on accrued obligations and the expected return on assets (calculated using a smoothed market value of assets). Any difference between actual and expected returns on assets during a year and actuarial gains and losses on liabilities together with any prior service costs are charged (or credited) to income over the average remaining service lives of employees. | |||
The benefit cost components shown in the Consolidated Statements of Comprehensive Income are based upon various actuarial assumptions and methodologies as prescribed by authoritative accounting guidance. These assumptions include discount rates, expected return on plan assets, health care cost trend rates, inflation, rate of compensation increases, population demographics, mortality rates and other factors. The Company reviews all actuarial assumptions on an annual basis. Changes in key economic indicators can change these assumptions. These assumptions, along with the actual value of assets at the measurement date, will impact the calculation of pension expenses for the year. For instance, the effect of a one percentage point decrease in the assumed discount rate would result in an increase in the December 31, 2014 defined benefit pension plans obligation of approximately $20.0 million. Similarly, a one percentage point decrease in the assumed discount rate would result in an increase in the December 31, 2014 OPEB obligation of approximately $23.7 million. | |||
Recently Issued Accounting Pronouncements | |||
In August 2014, the FASB issued authoritative accounting guidance on the disclosure of uncertainties about an entity’s ability to continue as a going concern. The guidance requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that financial statements are available to be issued when applicable) and to provide related footnote disclosures. The guidance is effective prospectively for fiscal years beginning after December 15, 2016, but can be early-adopted. While the adoption of this guidance is not expected to have an effect on the Company’s consolidated financial statements, it could affect the disclosure applied under these circumstances in the future. | |||
In May 2014, the FASB issued authoritative accounting guidance on a company’s accounting for revenue from contracts with customers. The guidance applies to all companies that enter into contracts with customers to transfer goods, service or nonfinancial assets. The guidance requires these companies to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires improved disclosures regarding the nature, timing, amount and uncertainty of revenue that is recognized. The guidance is effective prospectively for fiscal years beginning after December 15, 2016. Management is currently assessing the potential impact of the adoption of this guidance on the Company’s consolidated financial statements. |
INVENTORIES
INVENTORIES | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
INVENTORIES | NOTE 3. | INVENTORIES | |||||||
Inventories consisted of the following components (dollars in millions): | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Purchased parts and raw materials | $ | 72.3 | $ | 79.7 | |||||
Work in progress | 6.1 | 5.7 | |||||||
Service parts | 46.5 | 45.8 | |||||||
Finished goods | 18.6 | 29.2 | |||||||
Total inventories | $ | 143.5 | $ | 160.4 | |||||
Inventory components shipped to third parties, primarily cores, parts to re-manufacturers, and parts to contract manufacturers, in which the Company has an obligation to buy back, are included in purchased parts and raw materials, with an offsetting liability in Other current liabilities. See NOTE 12, “Other Current Liabilities” for more information. |
PROPERTY_PLANT_AND_EQUIPMENT
PROPERTY, PLANT AND EQUIPMENT | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
PROPERTY, PLANT AND EQUIPMENT | NOTE 4. | PROPERTY, PLANT AND EQUIPMENT | |||||||
The cost and accumulated depreciation of property, plant and equipment are as follows (dollars in millions): | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Land and land improvements | $ | 23.6 | $ | 20.3 | |||||
Buildings and building improvements | 281.6 | 271.4 | |||||||
Machinery and equipment | 576.2 | 567.7 | |||||||
Software | 117 | 112.9 | |||||||
Special tools | 143.6 | 143.4 | |||||||
Construction in progress | 39.9 | 48.6 | |||||||
Total property, plant and equipment | 1.181.9 | 1,164.30 | |||||||
Accumulated depreciation | (667.3 | ) | (600.9 | ) | |||||
Property, plant and equipment, net | $ | 514.6 | $ | 563.4 | |||||
Depreciation of property, plant and equipment was $93.8 million, $98.7 million and $102.5 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||
During 2014, the Company recorded an impairment of certain machinery and equipment, and special tools associated with the production of the H3000 and H4000 hybrid-propulsion systems. See NOTE 2, “Impairment of long-lived assets” for more information. |
GOODWILL_AND_OTHER_INTANGIBLE_
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 5. | GOODWILL AND OTHER INTANGIBLE ASSETS | |||||||||||||||||||||||
As of December 31, 2014 and 2013, the carrying amount of the Company’s Goodwill was $1,941.0 million. | |||||||||||||||||||||||||
The following presents a summary of other intangible assets (dollars in millions): | |||||||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||||||
Intangible | Accumulated | Intangible | Intangible | Accumulated | Intangible | ||||||||||||||||||||
assets, gross | amortization | assets, net | assets, gross | amortization | assets, net | ||||||||||||||||||||
Other intangible assets: | |||||||||||||||||||||||||
Trade name | $ | 870 | $ | — | $ | 870 | $ | 870 | $ | — | $ | 870 | |||||||||||||
Customer relationships - defense | 62.3 | (27.9 | ) | 34.4 | 62.3 | (24.4 | ) | 37.9 | |||||||||||||||||
Customer relationships - commercial | 831.8 | (426.9 | ) | 404.9 | 831.8 | (374.9 | ) | 456.9 | |||||||||||||||||
Proprietary technology | 476.3 | (282.0 | ) | 194.3 | 476.3 | (243.9 | ) | 232.4 | |||||||||||||||||
Non-compete agreement | 17.3 | (12.8 | ) | 4.5 | 17.3 | (11.1 | ) | 6.2 | |||||||||||||||||
Patented technology - defense | 28.2 | (24.5 | ) | 3.7 | 28.2 | (21.2 | ) | 7 | |||||||||||||||||
Tooling rights | 4.5 | (4.3 | ) | 0.2 | 4.5 | (4.1 | ) | 0.4 | |||||||||||||||||
Patented technology - commercial | 260.6 | (260.6 | ) | — | 260.6 | (260.6 | ) | — | |||||||||||||||||
Total | $ | 2,551.00 | $ | (1,039.0 | ) | $ | 1,512.00 | $ | 2,551.00 | $ | (940.2 | ) | $ | 1,610.80 | |||||||||||
Amortization of intangible assets was $98.8 million, $105.3 million and $150.0 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||||||||||||||||||
As of December 31, 2014, the net carrying value of the Company’s Goodwill and Other intangible assets, net was $3,453.0 million. | |||||||||||||||||||||||||
Amortization expense related to other intangible assets for the next five years and thereafter is expected to be (dollars in millions): | |||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | ||||||||||||||||||||
Amortization expense | $ | 97.1 | $ | 92.4 | $ | 89.7 | $ | 87.2 | $ | 85.7 | $ | 189.9 | |||||||||||||
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | NOTE 6. | FAIR VALUE OF FINANCIAL INSTRUMENTS | |||||||||||||||||||||||
In accordance with the FASB’s authoritative accounting guidance on fair value measurements, fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company primarily applies the market approach for recurring fair value measurements and utilizes the best available information that maximizes the use of observable inputs and minimizes the use of unobservable inputs. The Company is able to classify fair value balances based on the observability of those inputs. The accounting guidance establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy defined by the relevant guidance are as follows: | |||||||||||||||||||||||||
Level 1 — Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, listed equities and publicly traded bonds. | |||||||||||||||||||||||||
Level 2 — Pricing inputs are other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reported date. Level 2 includes financial instruments that are valued using quoted prices in markets that are not active and those financial instruments that are valued using models or other valuation methodologies. These models are primarily industry standard models that consider various assumptions, including quoted forward prices for commodities, time value, volatility factors, and current market and contractual prices for the underlying instruments, as well as other relevant economic measures. Substantially all of these assumptions are observable in the marketplace throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the marketplace. | |||||||||||||||||||||||||
Level 3 — Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methodologies that result in management’s best estimate of fair value. At each balance sheet date, the Company performs an analysis of all instruments subject to authoritative accounting guidance and includes, in Level 3, all of those whose fair value is based on significant unobservable inputs. As of December 31, 2014 and 2013, the Company did not have any Level 3 financial assets or liabilities. | |||||||||||||||||||||||||
The Company’s assets and liabilities that are measured at fair value include cash and cash equivalents, available-for-sale securities, derivative instruments, assets held in a rabbi trust and a deferred compensation obligation. The Company’s cash equivalents consist of short-term U.S. government backed securities. The Company’s available-for-sale securities consist of ordinary shares of Torotrak plc (“Torotrak”) associated with a license and exclusivity agreement with Torotrak. Torotrak’s listed shares are traded on the London Stock Exchange under the ticker symbol “TRK.” The Company’s derivative instruments consist of interest rate swaps, foreign currency forward contracts and commodity swaps. The Company’s assets held in the rabbi trust consist principally of publicly available mutual funds and target date retirement funds. The Company’s deferred compensation obligation is directly related to the fair value of assets held in the rabbi trust. | |||||||||||||||||||||||||
The Company’s valuation techniques used to calculate the fair value of cash and cash equivalents, available-for-sale securities, assets held in the rabbi trust and the deferred compensation obligation represent a market approach in active markets for identical assets that qualify as Level 1 in the fair value hierarchy. The Company’s valuation techniques used to calculate the fair value of derivative instruments represent a market approach with observable inputs that qualify as Level 2 in the fair value hierarchy. | |||||||||||||||||||||||||
The foreign currency contracts consist of forward rate contracts which are intended to hedge exposure of transactions denominated in certain currencies and reduce the impact of currency price volatility on the Company’s financial results. The commodity contracts consist of forward rate contracts which are intended to hedge exposure of transactions involving purchases of component parts and energy to power our facilities, reducing the impact of commodity price volatility on the Company’s financial results. | |||||||||||||||||||||||||
For the fair value measurement of foreign currency derivatives, the Company uses forward foreign exchange rates received from the issuing financial institution. These rates are periodically corroborated by comparing to third-party broker quotes. The foreign currency hedges are accounted for within the authoritative accounting guidance set forth on accounting for derivative instruments and hedging activities and have been recorded at fair value based upon quoted market rates. The fair values are included in Other current and non-current assets and liabilities in the Consolidated Balance Sheets. The Company generally does not elect to apply hedge accounting for these foreign currency contracts, and as a result, unrealized fair value adjustments and realized gains and losses are recorded in Other expense, net in the Consolidated Statements of Comprehensive Income during the period of change. | |||||||||||||||||||||||||
For the fair value measurement of commodity derivatives, the Company uses forward prices received from the issuing financial institution. These rates are periodically corroborated by comparing to third-party broker quotes. The commodity derivatives are accounted for within the authoritative accounting guidance set forth on accounting for derivative instruments and hedging activities and have been recorded at fair value based upon quoted market rates. The fair values are included in Other current and non-current assets and liabilities in the Consolidated Balance Sheets. The Company has either not qualified for or not elected hedge accounting treatment for these commodity contracts, and as a result, unrealized fair value adjustments and realized gains and losses are recorded in Other expense, net in the Consolidated Statements of Comprehensive Income. | |||||||||||||||||||||||||
For the fair value measurement of interest rate derivatives, the Company uses valuations from the issuing financial institution. The Company corroborates the valuation through the use of third-party valuation services using a standard replacement valuation model. The floating-to-fixed interest rate swaps are based on the London Interbank Offered Rate (“LIBOR”) which is observable at commonly quoted intervals. The fair values are included in other current and non-current assets and liabilities in the Consolidated Balance Sheets. The Company has not qualified for hedge accounting treatment for the interest rate swaps and, as a result, fair value adjustments are charged directly to Interest expense in the Consolidated Statements of Comprehensive Income. | |||||||||||||||||||||||||
The following table summarizes the fair value of the Company’s financial assets and (liabilities) as of December 31 (dollars in millions): | |||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||
Quoted Prices in Active | Significant Other | TOTAL | |||||||||||||||||||||||
Markets for Identical | Observable Inputs (Level 2) | ||||||||||||||||||||||||
Assets (Level 1) | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||
Cash equivalents | $ | 55 | $ | 5 | $ | — | $ | — | $ | 55 | $ | 5 | |||||||||||||
Available-for-sale securities | 8.6 | 8.2 | — | — | 8.6 | 8.2 | |||||||||||||||||||
Rabbi trust assets | 2.9 | 1.3 | — | — | 2.9 | 1.3 | |||||||||||||||||||
Deferred compensation obligation | (2.9 | ) | (1.3 | ) | — | — | (2.9 | ) | (1.3 | ) | |||||||||||||||
Derivative assets | — | — | 0 | 1.6 | 0 | 1.6 | |||||||||||||||||||
Derivative liabilities | — | — | (15.4 | ) | (21.4 | ) | (15.4 | ) | (21.4 | ) | |||||||||||||||
Total | $ | 63.6 | $ | 13.2 | $ | (15.4 | ) | $ | (19.8 | ) | $ | 48.2 | $ | (6.6 | ) | ||||||||||
DEBT
DEBT | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
DEBT | NOTE 7. | DEBT | |||||||||||||||||||
Long-term debt and maturities are as follows (dollars in millions): | |||||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Long-term debt: | |||||||||||||||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | $ | 283.6 | $ | 423.5 | |||||||||||||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | 1,765.60 | 1,783.50 | |||||||||||||||||||
Senior Notes, fixed 7.125%, due 2019 | 471.3 | 471.3 | |||||||||||||||||||
Total long-term debt | $ | 2,520.50 | $ | 2,678.30 | |||||||||||||||||
Less: current maturities of long-term debt | 17.9 | 17.9 | |||||||||||||||||||
Total long-term debt less current portion | $ | 2,502.60 | $ | 2,660.40 | |||||||||||||||||
Principal payments required on long-term debt during the next five years are as follows: | |||||||||||||||||||||
Required Principal Payments | |||||||||||||||||||||
(dollars in millions) | 2015 | 2016 | 2017 | 2018 | 2019 | ||||||||||||||||
Payment | $ | 17.9 | $ | 17.9 | $ | 301.4 | $ | 17.9 | $ | 2,165.40 | |||||||||||
As of December 31, 2014, the Company had $283.6 million of indebtedness associated with Allison Transmission, Inc.’s (“ATI”), the Company’s wholly-owned subsidiary, Senior Secured Credit Facility Term B-2 Loan due 2017 (“Term B-2 Loan”) and $1,765.6 million of indebtedness associated with ATI’s Senior Secured Credit Facility Term B-3 Loan due 2019 (“Term B-3 Loan” and together with the Term B-2 Loan and revolving credit facility, the “Senior Secured Credit Facility”). The Company also had indebtedness of $471.3 million of ATI’s 7.125% senior cash pay notes due May 2019 (“7.125% Senior Notes”). | |||||||||||||||||||||
The fair value of the Company’s long-term debt obligations as of December 31, 2014 was $2,515.9 million. The fair value is based on quoted Level 2 market prices of the Company’s debt as of December 31, 2014. It is not expected that the Company would be able to repurchase a significant amount of its debt at these levels. The difference between the fair value and carrying value of the long-term debt is driven primarily by trends in the financial markets. | |||||||||||||||||||||
Senior Secured Credit Facility | |||||||||||||||||||||
In March 2012, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $801.1 million in principal amount of term loan debt from August 2014 to August 2017 and to increase the applicable margin at the Company’s option to either (a) 3.50% over the LIBOR or (b) 2.50% over the greater of the prime lending rate provided by the British Banking Association or the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50%. As a result of the debt modification, the Company recorded an additional $2.3 million as deferred financing fees in the Consolidated Balance Sheets and extended the amortization period of $5.1 million of deferred financing fees from 2014 to 2017. | |||||||||||||||||||||
In August 2012, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $850.0 million of term loan debt from August 2014 to August 2019 and to increase the applicable margin at the Company’s option to either (a) 3.25% or 3.00%, subject to the Company’s total leverage ratio, over the LIBOR (which may not be less than 1.00%) or (b) 2.25% or 2.00%, subject to the Company’s total leverage ratio, over the greater of the prime lending rate provided by the British Banking Association or the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.5% (which may not be less than 2.00%). The amendment was treated as an extinguishment of debt under GAAP, and thus the Company expensed $4.5 million of deferred financing fees and recorded $16.1 million of new deferred financing fees in the consolidated financial statements. | |||||||||||||||||||||
In October 2012, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $300.0 million of term loan debt from August 2014 to August 2019 and to increase the applicable margin at the Company’s option to either (a) 3.25% or 3.00%, subject to the Company’s total leverage ratio, over the LIBOR (which may not be less than 1.00%) or (b) 2.25% or 2.00%, subject to the Company’s total leverage ratio, over the greater of the prime lending rate provided by the British Banking Association or the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50% (which may not be less than 2.00%). The amendment was treated as an extinguishment of debt under GAAP, and thus the Company expensed $1.4 million of deferred financing fees and recorded $1.8 million of new deferred financing fees in the consolidated financial statements. | |||||||||||||||||||||
In February 2013, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to refinance $793.1 million of term loan debt and decrease the applicable margin for such term loans at the Company’s option to either (a) 3.00% over the LIBOR or (b) 2.00% over the greater of the prime lending rate provided by the British Banking Association or the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50%. In February 2013, ATI also entered into an additional amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $411.4 million of term loan debt from August 2014 to August 2017 and to increase the applicable margin at the Company’s option to either (a) 3.00% over the LIBOR or (b) 2.00% over the greater of the prime lending rate provided by the British Banking Association or the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50%. The February 2013 amendments were treated as a modification of debt under GAAP, and the Company expensed $1.0 million of deferred financing fees and recorded $1.6 million of new deferred financing fees in the consolidated financial statements. | |||||||||||||||||||||
In August 2013, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to refinance $1,139.3 million of term loan debt and decrease the applicable margin for such term loans at the Company’s option to either (a) 2.75% or 2.50%, subject to the Company’s total leverage ratio, over the LIBOR (which may not be less than 1.00%) or (b) 1.75% or 1.50%, subject to the Company’s total leverage ratio, over the greater of the prime lending rate provided by the British Banking Association or the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50% (which may not be less than 2.00%). The amendment was treated as a modification of debt under GAAP, and thus the Company expensed $2.1 million of deferred financing fees and recorded $1.0 million of new deferred financing fees in the consolidated financial statements. | |||||||||||||||||||||
In December 2013, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $650.0 million of term loan debt from August 2017 to August 2019 and to reduce the applicable margin at the Company’s option to either (a) 2.75% or 2.50%, subject to the Company’s total leverage ratio, over the LIBOR (which may not be less than 1.00%) or (b) 1.75% or 1.50%, subject to the Company’s total leverage ratio, over the greater of the prime lending rate provided by the British Banking Association or the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50% (which may not be less than 2.00%). The amendment also extended the maturity of the revolving credit facility to January 2019, increased the borrowing capacity to $410.0 million, reduced the interest rate spread to either 2.25%, 2.00% or 1.75% on LIBOR loans or 1.25%, 1.00% or 0.75% on Base Rate loans, subject to the Company’s total leverage ratio, reduced the commitment fee to either 0.375% or 0.25%, subject to the Company’s total leverage ratio, and increased the letters of credit sublimit to $75.0 million. Lastly, the amendment changed the requirement of the maximum total senior secured leverage ratio, so that it is only applicable to the revolving portion of the Senior Secured Credit Facility and is tested only when revolving commitments (including letters of credit) remain outstanding at the end of any fiscal quarter. The amendment to the term loans was treated as a modification of debt under GAAP, and thus the Company expensed $0.5 million of deferred financing fees and recorded $10.1 million of new deferred financing fees in the consolidated financial statements. The amendment to the revolving portion of the Senior Secured Credit Facility was treated as a modification of debt under GAAP, and thus the Company expensed $0.4 million of deferred financing fees and recorded $2.1 million of new deferred financing fees in the consolidated financial statements. | |||||||||||||||||||||
In April 2014, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to refinance Term B-2 Loan. The interest rate margin applicable to such refinanced loan is at the Company’s option, either (a) 2.75% over the LIBOR or (b) 1.75% over the greater of the prime lending rate provided by the British Banking Association or the federal funds effective rate published by the Federal Reserve Bank of New York plus 0.50%. The Company recorded $0.3 million of new deferred financing fees in the condensed consolidated financial statements. As of December 31, 2014, these rates were approximately 2.92% and 3.75% on the Term B-2 Loan and Term B-3 Loan, respectively, and the weighted average rate on the Senior Secured Credit Facility was approximately 3.64%. The Senior Secured Credit Facility requires minimum quarterly principal payments on the Term B-2 Loan and Term B-3 Loan as well as prepayments from certain net cash proceeds of non-ordinary course asset sales and casualty and condemnation events and from a percentage of excess cash flow, if applicable. Due to voluntary prepayments, the Company has fulfilled all Term B-2 Loan required quarterly payments through its maturity date of 2017. During 2014, the Company made principal payments of $140.0 million on the Term B-2 Loan, resulting in a loss of $0.5 million associated with the write off of related deferred debt issuance costs. The minimum required quarterly principal payment on the Term B-3 Loan is $4.5 million and remains through its maturity date of 2019. As of December 31, 2014, there had been no payments required for certain net cash proceeds of non-ordinary course asset sales and casualty and condemnation events. The remaining principal balance on each loan is due upon maturity. | |||||||||||||||||||||
The Senior Secured Credit Facility is collateralized by a lien on substantially all assets of the Company including all of ATI’s capital stock and all of the capital stock or other equity interest held by the Company, ATI and each of the Company’s existing and future U.S. subsidiary guarantors (subject to certain limitations for equity interests of foreign subsidiaries and other exceptions set forth in the terms of the Senior Secured Credit Facility). | |||||||||||||||||||||
In accordance with the Senior Secured Credit Facility, net cash proceeds of non-ordinary course asset sales, casualty and condemnation events will only be required to prepay the term loan if the Company does not reinvest or commit to reinvest such net cash proceeds in assets to be used in its business or to make certain other permitted investments within 15 months of the related transaction or event, subject to certain limitations. The Company must apply 50% of its annual excess cash flow (as defined in the Senior Secured Credit Facility) to the prepayment of the Senior Secured Credit Facility, however this percentage reduces to certain levels and eventually to zero upon achievement of certain total senior secured leverage ratios. For the year ended December 31, 2014 and 2013, the Company was not required to make an excess cash flow payment. | |||||||||||||||||||||
The Senior Secured Credit Facility also provides for revolving credit borrowings. In 2014, ATI increased the revolving commitments available under the revolving portion of the Senior Secured Credit Facility to $465.0 million, net of an allowance for up to $75.0 million in outstanding letters of credit commitments. The increase was treated as a modification of debt under GAAP, and thus the Company recorded $0.6 million of new deferred financing fees in the consolidated financial statements. As of December 31, 2014, the Company had $455.1 million available under the revolving credit facility, net of $9.9 million in letters of credit. During 2014, the Company made one withdrawal and payment on the revolving credit facility as part of its debt management plans. The maximum amount outstanding at any time during the year on the revolving credit facility was $40.0 million, and the entire balance was repaid within the quarter it was borrowed. Revolving credit borrowings bear interest at a variable base rate plus an applicable margin based on the Company’s total leverage ratio. As of December 31, 2014, this rate would have been approximately 1.92%. In addition, there is an annual commitment fee, based on the Company’s total leverage ratio, which as of December 31, 2014, was equal to 0.25% of the average unused revolving credit borrowings available under the Senior Secured Credit Facility. Revolving credit borrowings are payable at the option of the Company throughout the term of the Senior Secured Credit Facility with the balance due in January 2019. | |||||||||||||||||||||
The revolving portion of the Senior Secured Credit Facility requires the Company to maintain a specified maximum total senior secured leverage ratio of 5.50x when revolving loan commitments remain outstanding at the end of a fiscal quarter. On March 12, 2014, however, the revolving lenders holding a majority of the revolving loan commitments permanently waived and agreed that no event of default would result from any non-compliance so long as there were no revolving loans outstanding as of the last day of any fiscal quarter. As of December 31, 2014, the Company had no revolving loans outstanding; however the Company would have been in compliance with the maximum total senior secured leverage ratio, achieving a 2.42x ratio. Additionally within the terms of the Senior Secured Credit Facility, a senior secured leverage ratio at or below 3.50x results in the elimination of excess cash flow payments on the Senior Secured Credit Facility for the applicable year. The Senior Secured Credit Facility also provides certain financial incentives based on our total leverage ratio. A total leverage ratio at or below 4.00x results in a 25 basis point reduction to the applicable margin on the revolving credit facility, and a total leverage ratio at or below 3.50x results in a 12.5 basis point reduction to the revolving credit facility commitment fee and an additional 25 basis point reduction to the applicable margin on the revolving credit facility. A total leverage ratio at or below 3.25x results in a 25 basis point reduction to the applicable margin on our Term B-3 Loan. These reductions would remain in effect as long as the Company achieves a total leverage ratio at or below the related threshold. As of December 31, 2014, the total leverage ratio was 3.05x. | |||||||||||||||||||||
In addition, the Senior Secured Credit Facility, among other things, includes customary restrictions (subject to certain exceptions) on the Company’s ability to incur certain indebtedness, grant certain liens, make certain investments, declare or pay certain dividends, or repurchase shares of the Company’s common stock. As of December 31, 2014, the Company is in compliance with all covenants under the Senior Secured Credit Facility. | |||||||||||||||||||||
Senior Notes | |||||||||||||||||||||
In May 2011, the Company completed an offering of $500.0 million of the 7.125% Senior Notes. The Company may from time to time seek to retire the 7.125% Senior Notes through cash purchases and/or exchanges for equity securities, in open market purchases, privately negotiated transactions, contractual redemptions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors. The amounts involved may be material. Prior to May 15, 2015, the Company may redeem some or all of the 7.125% Senior Notes by paying the applicable “make-whole” premium. At any time on or after May 15, 2015, the Company may redeem some or all of the 7.125% Senior Notes at specified redemption prices in the governing indenture. | |||||||||||||||||||||
The 7.125% Senior Notes are unsecured and guaranteed by the subsidiaries that guarantee the Senior Secured Credit Facility and will be unconditionally guaranteed, jointly and severally, by any future domestic subsidiaries that guarantee the Senior Secured Credit Facility. The indenture governing the 7.125% Senior Notes contains negative covenants restricting or limiting the Company’s ability to, among other things: incur or guarantee additional indebtedness, incur liens, pay dividends on, redeem or repurchase the Company’s capital stock, make certain investments, permit payment or dividend restrictions on certain of the Company’s subsidiaries, sell assets, engage in certain transactions with affiliates, and consolidate or merge or sell all or substantially all of the Company’s assets. Certain of these covenants would be suspended if the 7.125% Senior Notes were to reach investment grade. |
DERIVATIVES
DERIVATIVES | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
DERIVATIVES | NOTE 8. | DERIVATIVES | |||||||||||||||||||
The Company is exposed to certain financial risk from volatility in interest rates, foreign exchange rates and commodity prices. The risk is managed through the use of financial derivative instruments including interest rate swaps, foreign currency forward contracts and commodity swaps. The Company’s current derivative instruments are used strictly as an economic hedge and not for speculative purposes. As necessary, the Company adjusts the values of the derivative instruments for counter-party or credit risk. | |||||||||||||||||||||
Interest Rate | |||||||||||||||||||||
The Company is subject to interest rate risk related to the Senior Secured Credit Facility and enters into interest rate swap contracts that are based on the LIBOR to manage a portion of this exposure. The Company has not elected hedge accounting treatment for these derivatives, and as a result, fair value adjustments are charged directly to Interest expense in the Consolidated Statements of Comprehensive Income. A summary of the Company’s interest rate derivatives as of December 31, 2014 and December 31, 2013 follows (dollars in millions): | |||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||
Notional | Fair Value | Notional | Fair Value | ||||||||||||||||||
Amount | Amount | ||||||||||||||||||||
3.75% Interest Rate Swap H, Aug 2011 – Aug 2014 | $ | — | $ | — | $ | 350 | $ | (7.2 | ) | ||||||||||||
3.77% Interest Rate Swap I, Aug 2011 – Aug 2014 | — | — | 350 | (7.2 | ) | ||||||||||||||||
2.96% Interest Rate Swap J, Aug 2013 – Aug 2014 | — | — | 125 | (2.0 | ) | ||||||||||||||||
3.05% Interest Rate Swap K, Aug 2013 – Aug 2014 | — | — | 125 | (2.0 | ) | ||||||||||||||||
3.44% Interest Rate Swap L, Aug 2016 – Aug 2019* | 75 | (2.3 | ) | 75 | (0.4 | ) | |||||||||||||||
3.43% Interest Rate Swap M, Aug 2016 – Aug 2019* | 100 | (3.0 | ) | 100 | (0.4 | ) | |||||||||||||||
3.37% Interest Rate Swap N, Aug 2016 – Aug 2019* | 75 | (2.1 | ) | 75 | (0.2 | ) | |||||||||||||||
3.19% Interest Rate Swap O, Aug 2016 – Aug 2019* | 75 | (1.7 | ) | 75 | 0.2 | ||||||||||||||||
3.08% Interest Rate Swap P, Aug 2016 – Aug 2019* | 75 | (1.5 | ) | 75 | 0.4 | ||||||||||||||||
2.99% Interest Rate Swap Q, Aug 2016 – Aug 2019* | 50 | (0.9 | ) | 50 | 0.4 | ||||||||||||||||
2.98% Interest Rate Swap R, Aug 2016 – Aug 2019* | 50 | (0.9 | ) | 50 | 0.4 | ||||||||||||||||
2.73% Interest Rate Swap S, Aug 2016 – Aug 2019* | 50 | (0.5 | ) | — | — | ||||||||||||||||
2.74% Interest Rate Swap T, Aug 2016 – Aug 2019* | 75 | (0.8 | ) | — | — | ||||||||||||||||
2.66% Interest Rate Swap U, Aug 2016 – Aug 2019* | 50 | (0.4 | ) | — | — | ||||||||||||||||
2.60% Interest Rate Swap V, Aug 2016 – Aug 2019* | 50 | (0.3 | ) | — | — | ||||||||||||||||
2.40% Interest Rate Swap W, Aug 2016 – Aug 2019* | 25 | 0 | — | — | |||||||||||||||||
* includes LIBOR floor of 1.00% | $ | 750 | $ | (14.4 | ) | $ | 1,450.00 | $ | (18.0 | ) | |||||||||||
As of December 31, 2014, the Company did not have any interest rate derivatives subject to credit-risk or collateral requirement. As of December 31, 2013, certain of the Company’s interest rate derivatives contained credit-risk and collateral contingent features under which downgrades in the Company’s credit rating would have required the Company to increase its collateral. As of December 31, 2013, certain interest rate derivatives also contained provisions under which the Company was required to post additional collateral if the LIBOR interest rate curve reached certain levels. | |||||||||||||||||||||
As of December 31, 2014 and December 31, 2013, the Company had recorded cash collateral of $0.0 million and $1.7 million, respectively, in Other current assets in the Condensed Consolidated Balance Sheets, as the balances are subject to frequent change. | |||||||||||||||||||||
Currency Exchange | |||||||||||||||||||||
The Company’s business is subject to foreign exchange rate risk. As a result, the Company enters into various forward rate contracts that qualify as derivatives under the authoritative accounting guidance to manage certain of these exposures. Forward contracts are used to hedge forecasted transactions and known exposure of payables denominated in a foreign currency. The Company generally has not elected to apply hedge accounting under the authoritative accounting guidance and recorded the unrealized fair value adjustments and realized gains and losses associated with these contracts in Other expense, net in the Consolidated Statements of Comprehensive Income during the period of change. | |||||||||||||||||||||
The following table summarizes the outstanding foreign currency forward contracts as of December 31, 2014 and 2013 (amounts in millions): | |||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||
Notional | Fair Value | Notional | Fair Value | ||||||||||||||||||
Amount | Amount | ||||||||||||||||||||
Japanese Yen (JPY) | ¥ | 300 | $ | (0.3 | ) | ¥ | 600 | $ | (0.3 | ) | |||||||||||
$ | (0.3 | ) | $ | (0.3 | ) | ||||||||||||||||
Commodity | |||||||||||||||||||||
The Company’s business is subject to commodity price risk, primarily with component suppliers. As a result, the Company enters into various commodity swap contracts that qualify as derivatives under the authoritative accounting guidance to manage certain of these exposures. Swap contracts are used to hedge forecasted transactions either of the commodity or of components containing the commodity. The Company has not qualified for hedge accounting treatment for these commodity contracts, and as a result, unrealized fair value adjustments and realized gains and losses associated with these contracts were charged directly to Other expense, net in the Consolidated Statements of Comprehensive Income during the period of change. | |||||||||||||||||||||
The following table summarizes the outstanding commodity swaps as of December 31, 2014 and December 31, 2013 (dollars in millions): | |||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||
Notional | Quantity | Fair Value | Notional | Quantity | Fair Value | ||||||||||||||||
Amount | Amount | ||||||||||||||||||||
Aluminum | $ | 11.3 | 6,200 metric tons | $ | (0.7 | ) | $ | 23.8 | 11,875 metric tons | $ | (1.6 | ) | |||||||||
Natural Gas | $ | 0.2 | 60,000 MMBtu | 0 | $ | 0.3 | 90,000 MMBtu | 0 | |||||||||||||
$ | (0.7 | ) | $ | (1.6 | ) | ||||||||||||||||
The following tabular disclosures further describe the Company’s derivative instruments and their impact on the financial condition of the Company (dollars in millions): | |||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||
Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | ||||||||||||||||||
Derivatives not designated as hedging instruments | |||||||||||||||||||||
Foreign currency contracts | Other current | $ | (0.3 | ) | Other current | $ | (0.3 | ) | |||||||||||||
liabilities | liabilities | ||||||||||||||||||||
Commodity contracts | Other current and | 0.1 | |||||||||||||||||||
non-current assets | |||||||||||||||||||||
Other current and | (0.7 | ) | Other current and | (1.7 | ) | ||||||||||||||||
non-current liabilities | non-current liabilities | ||||||||||||||||||||
Interest rate contracts | Other non- | 1.5 | |||||||||||||||||||
current assets | |||||||||||||||||||||
Other non- | (14.4 | ) | Other current and | (19.5 | ) | ||||||||||||||||
current liabilities | non-current liabilities | ||||||||||||||||||||
Total derivatives not designated as hedging instruments | $ | (15.4 | ) | $ | (19.9 | ) | |||||||||||||||
The fair values of the derivatives are recorded between Other current and non-current assets and Other current and non-current liabilities as appropriate in the Consolidated Balance Sheets. As of December 31, 2014, the amount recorded to Other current liabilities for foreign currency contracts was ($0.3) million. The amounts recorded to Other current and non-current liabilities for commodity contracts were ($0.6) million and ($0.1) million, respectively. The amounts recorded to Other non-current liabilities for interest rate contracts were ($14.4) million, respectively. | |||||||||||||||||||||
As of December 31, 2013, the amount recorded to Other current liabilities for foreign currency contracts was ($0.3) million. The amounts recorded to Other current and non-current assets for commodity contracts were $0.1 million and $0.0 million, respectively. The amounts recorded to Other current and non-current liabilities for commodity contracts were ($1.5) million and ($0.2) million, respectively. The amount recorded to Other non-current assets for interest rate contracts was $1.5 million. The amounts recorded to Other current and non-current liabilities for interest rate contracts were ($18.5) million and ($1.0) million, respectively. | |||||||||||||||||||||
The impact on the Company’s Consolidated Statements of Comprehensive Income related to foreign currency and commodity contracts can be found in NOTE 11, and the following tabular disclosure describes the location and impact on the Company’s results of operations related to unrealized gain (loss) on interest rate derivatives (dollars in millions): | |||||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Location of impact on results of operations | |||||||||||||||||||||
Interest expense | $ | 3.5 | $ | 34.3 | $ | 25.5 |
PRODUCT_WARRANTY_LIABILITIES
PRODUCT WARRANTY LIABILITIES | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
PRODUCT WARRANTY LIABILITIES | NOTE 9. | PRODUCT WARRANTY LIABILITIES | |||||||||||
Product warranty liability activities consist of the following (dollars in millions): | |||||||||||||
Year ended | Year ended | Year ended | |||||||||||
December 31, | December 31, | December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||||
Beginning balance | $ | 90.5 | $ | 109.7 | $ | 115.4 | |||||||
Payments | (35.0 | ) | (38.7 | ) | (47.3 | ) | |||||||
Increase in liability (warranty issued during period) | 26.8 | 28.4 | 25.5 | ||||||||||
Net adjustments to liability | 0.7 | (9.6 | ) | 15.3 | |||||||||
Accretion (for Predecessor liabilities) | 0.6 | 0.7 | 0.8 | ||||||||||
Ending balance | $ | 83.6 | $ | 90.5 | $ | 109.7 | |||||||
As of December 31, 2014, the current and non-current product warranty liabilities were $24.0 million and $59.6 million, respectively. As of December 31, 2013, the current and non-current product warranty liabilities were $37.4 million and $53.1 million, respectively. | |||||||||||||
During June 2007, Old GM recognized the estimated cost of replacing the Dual Power Inverter Module (“DPIM”) used on H 40/50 EP hybrid systems. Certain units were falling short of their expected service life and Allison Transmission (the “Predecessor”), an operating unit of General Motors Corporation, decided to cover repair or replacement for an extended period. The Company is responsible for the first $12.0 million of qualified cost while General Motors Company (“GM”) is responsible for the next $34.0 million of costs, with any amount over $46.0 million being shared one-third by the Company and two-thirds by GM for shipments through June 30, 2009. | |||||||||||||
During 2014, the Company completed an analysis of its DPIM extended coverage program and determined, based on current claims, that the product warranty liability should be increased by $3.9 million. This resulted in a $2.9 million increase in the GM DPIM receivable and a $1.0 million unfavorable adjustment to the Consolidated Statements of Comprehensive Income. As of December 31, 2014, the DPIM liability was $48.5 million with an associated receivable from GM of $28.7 million. Through December 31, 2014, the Company had paid approximately $32.8 million in DPIM claims and received approximately $14.9 million in reimbursement from GM. The Company will continue to review the total DPIM liability and GM receivable for any changes in estimates as additional data becomes available. | |||||||||||||
During 2013, the Company completed an analysis of its DPIM extended coverage program and determined, based on current claims, that the product warranty liability should be reduced by $8.2 million. This resulted in a $5.8 million reduction in the GM DPIM receivable and a $2.4 million favorable adjustment to the Consolidated Statements of Comprehensive Income. As of December 31, 2013, the DPIM liability was $44.6 million with an associated receivable from GM of $25.8 million. Through December 31, 2013, the Company had paid approximately $25.5 million in DPIM claims and received approximately $9.1 million in reimbursement from GM. | |||||||||||||
During 2012, the Company completed an analysis of its DPIM extended coverage program and determined, based on current claims, that the product liability should be reduced by $7.9 million. This resulted in a $7.3 million reduction in the GM DPIM receivable and a $0.6 million favorable adjustment to the Consolidated Statements of Comprehensive Income. As part of the analysis, it was also determined that design issues related to the early introduction of the replacement DPIM unit resulted in a $10.0 million increase to the product warranty liability. As the replacement DPIM unit is the responsibility of the Company and not covered by the asset purchase agreement dated June 28, 2007 (“Asset Purchase Agreement”), the Company recorded a $10.0 million charge to the Consolidated Statements of Comprehensive Income. | |||||||||||||
The remaining adjustments to the total liability in 2014, 2013 and 2012 were the result of general changes in estimates for various products as additional claims data and field information became available. |
DEFERRED_REVENUE
DEFERRED REVENUE | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
DEFERRED REVENUE | NOTE 10. | DEFERRED REVENUE | |||||||||||
As of December 31, 2014, the current and non-current deferred revenue for Extended Transmission Coverage (“ETC”) were $20.3 million and $48.7 million, respectively. As of December 31, 2013, the current and non-current deferred revenue for ETC were $20.4 million and $43.2 million, respectively. | |||||||||||||
Deferred revenue for ETC activity (dollars in millions): | |||||||||||||
Year ended | Year ended | Year ended | |||||||||||
December 31, | December 31, | December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||||
Beginning balance | $ | 63.6 | $ | 63.5 | $ | 60.5 | |||||||
Increases | 26.2 | 21.1 | 22.9 | ||||||||||
Revenue earned | (20.8 | ) | (21.0 | ) | (19.9 | ) | |||||||
Ending balance | $ | 69 | $ | 63.6 | $ | 63.5 | |||||||
Deferred revenue recorded in current liabilities related to unearned net sales for defense contracts for the years ended December 31, 2014, 2013 and 2012 was approximately $0.3 million, $8.8 million and $0.7 million, respectively. | |||||||||||||
Due to requests from the U.S. government, the Company billed, but did not ship certain tracked transmissions during 2013. Based on the lack of a fixed delivery date from the U.S. government, the Company deferred approximately $8.8 million of net sales for these transmissions until they were shipped in 2014. | |||||||||||||
OTHER_EXPENSE_NET
OTHER EXPENSE, NET | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
OTHER EXPENSE, NET | NOTE 11. | OTHER EXPENSE, NET | |||||||||||
Other expense, net consists of the following (dollars in millions): | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Loss on intercompany foreign exchange | $ | (5.4 | ) | $ | (2.3 | ) | $ | — | |||||
Grant program income | 2.6 | 5.2 | 11.5 | ||||||||||
Impairment loss on investments in technology-related initiatives | (2.0 | ) | (5.0 | ) | (14.4 | ) | |||||||
Gain on negotiation of commercial agreement | 2 | — | — | ||||||||||
Public offering fees and expenses | (1.4 | ) | (1.6 | ) | (6.1 | ) | |||||||
Unrealized gain (loss) on derivative contracts (see NOTE 8) | 1.2 | (1.5 | ) | 0.9 | |||||||||
Realized loss on derivative contracts (see NOTE 8) | (1.0 | ) | (2.8 | ) | (1.3 | ) | |||||||
Loss on foreign exchange | (1.0 | ) | (2.4 | ) | (2.6 | ) | |||||||
Loss on repayments and repurchases of long-term debt (see NOTE 7) | (0.5 | ) | (0.8 | ) | (22.1 | ) | |||||||
Termination of services agreement | — | — | (16.0 | ) | |||||||||
Loss on re-measurement of employee benefit plans (see NOTE 13) | — | — | (2.3 | ) | |||||||||
Other | (0.1 | ) | 0.3 | (0.4 | ) | ||||||||
Total | $ | (5.6 | ) | $ | (10.9 | ) | $ | (52.8 | ) | ||||
During 2014 and 2013, the Company recorded a loss of $5.4 and $2.3 million, respectively, resulting from intercompany financing transactions related to investments in plant assets for the Company’s India facility. | |||||||||||||
During 2014, the Company fulfilled its obligations to the U.S. Department of Energy related to the development of hybrid-propulsion systems manufacturing capacity in the U.S. (the “Grant Program”). All applicable costs associated with the Grant Program have been charged to Engineering — research and development while the Government’s matching reimbursement was recorded to Other expense, net in the Consolidated Statements of Comprehensive Income. | |||||||||||||
For the years ended December 31, 2014, 2013 and 2012, the Company made $2.0 million, $5.0 million and 14.4 million investments as part of an agreement to expand our position in transmission technologies. Due to various uncertainties surrounding the investments including, but not limited to, the startup nature of the underlying business, its continued negative cash flow, undercapitalization and unproven business plan, the Company has impaired the investments to zero as of December 31, 2014, 2013 and 2012. |
OTHER_CURRENT_LIABILITIES
OTHER CURRENT LIABILITIES | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
OTHER CURRENT LIABILITIES | NOTE 12. | OTHER CURRENT LIABILITIES | |||||||
Other current liabilities consist of the following (dollars in millions): | |||||||||
As of | As of | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Payroll and related costs | $ | 50.9 | $ | 32.7 | |||||
Sales allowances | 25.5 | 26.9 | |||||||
Defense price reduction reserve | 16.2 | 26.8 | |||||||
Vendor buyback obligation | 13.2 | 11.8 | |||||||
Taxes payable | 8.5 | 8.6 | |||||||
Accrued interest payable | 5.2 | 11.2 | |||||||
Derivative liabilities | 0.8 | 20.2 | |||||||
Other accruals | 11.4 | 14.1 | |||||||
Total | $ | 131.7 | $ | 152.3 | |||||
EMPLOYEE_BENEFIT_PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
EMPLOYEE BENEFIT PLANS | NOTE 13. | EMPLOYEE BENEFIT PLANS | |||||||||||||||||||||||
The Company’s hourly defined benefit pension plan generally provides benefits of negotiated, stated amounts for each year of service as well as significant supplemental benefits for employees who retire with 30 years of service before normal retirement age. For all hourly employees hired after May 18, 2008, the defined benefit pension plan was replaced with a defined contribution pension plan, and the company-sponsored retiree healthcare was also eliminated for those hired after May 18, 2008. The charge to expense for the hourly defined contribution pension plan was $1.3 million, $1.0 million and $0.9 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||||||||||||||||||
In accordance with the Asset Purchase Agreement, the Company’s hourly employees who retired prior to October 2, 2011 (the “Cutoff Date”) will have their pension and OPEB paid by GM. The Company was required, pursuant to the Asset Purchase Agreement, to transfer pension assets to GM’s pension plan to cover the Company’s portion of its pension liability related to the employees who retired prior to the Cutoff Date. During the second quarter of 2012, the Company completed the transfer of its pension obligation for certain qualified hourly employees to GM’s pension plan. The transfer required a re-measurement of the hourly defined benefit pension plan resulting in a one-time non-cash settlement charge of $2.3 million recorded in Other expense, net in the Consolidated Statements of Comprehensive Income and a $4.2 million reduction to the Company’s pension liability with corresponding adjustments to AOCL, net of tax. This resulted in a $17.9 million gain to the Company’s 2011 actuarial valuation. Employees that retire subsequent to the Cutoff Date will have their Allison pension and OPEB paid by the Company and their GM pension benefit paid by GM. | |||||||||||||||||||||||||
The Company’s salaried defined benefit plan covering salaried employees with a service date prior to January 1, 2001 is generally based on years of service and compensation history. The salaried defined contribution retirement savings plan requires the Company to match employee contributions up to certain predefined limits based upon eligible base salary. In addition to the matching contribution, the Company is required to make a contribution equal to 1% of eligible base salary for salaried employees with a service date on or after January 1, 1993 to cover certain benefits in retirement that are different from salaried employees with a service date prior to January 1, 1993. In addition, for salaried employees with a service date on or after January 1, 2001, the Company is required to contribute to its defined contribution retirement savings plan an amount equal to 4% of eligible base salary under the program. The charge to expense for the salaried defined contribution retirement savings plan was $5.4 million, $5.4 million and $5.1 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||||||||||||||||||||||||
The Company is also responsible for OPEB costs (medical, dental, vision, and life insurance) for hourly employees hired prior to May 19, 2008. Post-retirement benefit costs consist of service cost, interest cost on accrued obligations and the expected return on assets (calculated using a smoothed market value of assets). Any difference between actual and expected returns on assets during a year and actuarial gains and losses on liabilities together with any prior service costs are charged (or credited) to income over the average remaining service lives of employees. The benefit cost components shown in the Consolidated Statements of Comprehensive Income are based upon certain data specific to the Company, actuarial assumptions that were used for OPEB accounting disclosures, and certain allocation methodologies such as population demographics. The plan is unfunded and any future payments will be funded by the Company’s operating cash flows. As of December 31, 2014 and 2013, the Company had an estimated OPEB liability for hourly employees hired prior to May 19, 2008, excluding those employees eligible to retire at the time of the sale of the Company (“the Acquisition Transaction”), of $136.0 million and $120.7 million, respectively. | |||||||||||||||||||||||||
As part of the Health Care Reform Act enacted in 2010, the Company has evaluated the impact on “High-cost Health Plans” in which employers offering health plan coverage exceeding certain thresholds must pay an excise tax equal to 40% of the value of the plan that exceeds the threshold amount. Although the excise tax does not come into effect until 2018, the Company has recorded $4.0 million in its OPEB liability as of December 31, 2014 with a corresponding adjustment to AOCL, net of tax. | |||||||||||||||||||||||||
The Company provides contributions to certain international benefit plans; however, these contributions are not material for periods presented. | |||||||||||||||||||||||||
For all pension and OPEB plans in which employees participate, costs are determined within the FASB’s authoritative accounting guidance set forth on employers’ defined benefit pensions including accounting for settlements and curtailments of defined benefit pension plans, termination of benefits and accounting for post-retirement benefits other than pensions. In accordance with the authoritative accounting guidance, the Company recognizes the funded status of its defined benefit pension plans and OPEB plan in its Consolidated Balance Sheets with a corresponding adjustment to AOCL, net of tax. | |||||||||||||||||||||||||
Information about the net periodic benefit cost and other changes recognized in AOCL for the pension and post-retirement benefit plans is as follows (dollars in millions): | |||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | Year ended | Year ended | Year ended | ||||||||||||||||||||
December 31, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||
Net Periodic Benefit Cost: | |||||||||||||||||||||||||
Service cost | $ | 13.2 | $ | 16.3 | $ | 15.2 | $ | 2.2 | $ | 3.3 | $ | 3.9 | |||||||||||||
Interest cost | 5 | 4 | 4.1 | 5.9 | 5.8 | 7.2 | |||||||||||||||||||
Expected return on assets | (7.7 | ) | (6.7 | ) | (5.9 | ) | — | — | — | ||||||||||||||||
Prior service cost | 0.1 | 0.1 | 0.1 | (3.6 | ) | (3.6 | ) | — | |||||||||||||||||
Loss (gain) | — | 0.7 | 1.2 | (0.7 | ) | — | — | ||||||||||||||||||
Settlement loss | — | — | 2.3 | — | — | — | |||||||||||||||||||
Net Periodic Benefit Cost | $ | 10.6 | $ | 14.4 | $ | 17 | $ | 3.8 | $ | 5.5 | $ | 11.1 | |||||||||||||
Other changes recognized in other comprehensive income: | |||||||||||||||||||||||||
Prior service credit | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (28.9 | ) | ||||||||||||
Net loss (gain) | 2.1 | (18.4 | ) | (2.1 | ) | 7.8 | (30.7 | ) | 3.8 | ||||||||||||||||
Amortizations | (0.1 | ) | (0.8 | ) | (3.6 | ) | 4.3 | 3.6 | — | ||||||||||||||||
Total recognized – other comprehensive income | $ | 2 | $ | (19.2 | ) | $ | (5.7 | ) | $ | 12.1 | $ | (27.1 | ) | $ | (25.1 | ) | |||||||||
The table below provides the weighted-average actuarial assumptions used to determine the net periodic benefit cost. | |||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | Year ended | Year ended | Year ended | ||||||||||||||||||||
December 31, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||
Discount rate | 4.8 | % | 3.9 | % | 4.6 | % | 4.9 | % | 4.1 | % | 4.6 | % | |||||||||||||
Rate of compensation increase (salaried) | 3 | % | 3 | % | 4 | % | N/A | N/A | N/A | ||||||||||||||||
Expected return on assets | 6.8 | % | 7 | % | 7 | % | N/A | N/A | N/A | ||||||||||||||||
The table below provides the weighted-average actuarial assumptions used to determine the benefit obligations of the Company’s plans. | |||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Discount rate | 3.9 | % | 4.8 | % | 4 | % | 4.9 | % | |||||||||||||||||
Rate of compensation increase (salaried) | 3 | % | 3 | % | N/A | N/A | |||||||||||||||||||
The Company’s pension and OPEB costs are calculated using various actuarial assumptions and methodologies as prescribed by authoritative accounting guidance. These assumptions include discount rates, expected return on plan assets, health care cost trend rates, inflation, rate of compensation increases, mortality rates and other factors. The Company reviews all actuarial assumptions on an annual basis. | |||||||||||||||||||||||||
The discount rate is used to determine the present value of the Company’s benefit obligations. The Company’s discount rate is determined by matching the plans projected cash flows to a yield curve based on long-term, fixed income debt instruments available as of the measurement date of December 31, 2014. | |||||||||||||||||||||||||
The overall expected rate of return on plan assets is based upon historical and expected future returns consistent with the expected benefit duration of the plan for each asset group adjusted for investment and administrative fees. | |||||||||||||||||||||||||
During 2014, the Society of Actuaries finalized a new mortality table and a new mortality improvement scale that increased the anticipated longevity of life. As of December 31, 2014, as a result of the updated mortality assumption, the Company recorded an additional $2.9 million and $4.1 million in its defined benefit pension benefit obligation and OPEB obligation, respectively. | |||||||||||||||||||||||||
Health care cost trends are used to project future post-retirement benefits payable from the Company’s plans. For the Company’s December 31, 2014 obligations, future post-retirement medical care costs were forecasted assuming an initial annual increase of 6.70%, decreasing to 4.50% by the year 2027. Future post-retirement prescription drug costs were forecasted assuming an initial annual increase of 6.00%, decreasing to 4.50% by the year 2027. | |||||||||||||||||||||||||
As health care costs trends have a significant effect on the amounts reported, an increase and decrease of one-percentage-point would have the following effects in the year ended December 31, 2014 (dollars in millions): | |||||||||||||||||||||||||
1% Increase | 1% Decrease | ||||||||||||||||||||||||
Effect on total of service and interest cost | $ | 1.7 | $ | (1.3 | ) | ||||||||||||||||||||
Effect on post-retirement benefit obligation | $ | 28.6 | $ | (22.3 | ) | ||||||||||||||||||||
The following table provides a reconciliation of the changes in the net benefit obligations and fair value of plan assets for the years ended December 31, 2014, 2013 and 2012 (dollars in millions): | |||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | Year ended | Year ended | Year ended | ||||||||||||||||||||
December 31, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||
Benefit Obligations: | |||||||||||||||||||||||||
Net benefit obligation at beginning of year | $ | 105.9 | $ | 103.3 | $ | 99.7 | $ | 120.7 | $ | 142.6 | $ | 156.6 | |||||||||||||
Service cost | 13.2 | 16.3 | 15.2 | 2.2 | 3.3 | 3.9 | |||||||||||||||||||
Interest cost | 5 | 4 | 4.1 | 5.9 | 5.8 | 7.2 | |||||||||||||||||||
Plan Amendments | — | — | — | — | — | (28.9 | ) | ||||||||||||||||||
Settlements | — | — | (18.8 | ) | — | — | — | ||||||||||||||||||
Benefits paid | (1.5 | ) | (0.8 | ) | (0.4 | ) | (0.6 | ) | (0.3 | ) | — | ||||||||||||||
Actuarial loss (gain) | 10.9 | (16.9 | ) | 3.5 | 7.8 | (30.7 | ) | 3.8 | |||||||||||||||||
Net benefit obligation at end of year | $ | 133.5 | $ | 105.9 | $ | 103.3 | $ | 136 | $ | 120.7 | $ | 142.6 | |||||||||||||
Fair Value of Plan Assets: | |||||||||||||||||||||||||
Fair value of plan assets at beginning of year | $ | 108.6 | $ | 89.4 | $ | 83.4 | $ | — | $ | — | $ | — | |||||||||||||
Actual return on plan assets | 16.4 | 8.2 | 11.5 | — | — | — | |||||||||||||||||||
Employer contributions | 11.8 | 11.8 | 13.7 | 0.6 | 0.3 | — | |||||||||||||||||||
Settlements | — | — | (18.8 | ) | — | — | — | ||||||||||||||||||
Benefits paid | (1.5 | ) | (0.8 | ) | (0.4 | ) | (0.6 | ) | (0.3 | ) | — | ||||||||||||||
Fair value of plan assets at end of year | $ | 135.3 | $ | 108.6 | $ | 89.4 | $ | — | $ | — | $ | — | |||||||||||||
Net Funded Status | $ | 1.8 | $ | 2.7 | $ | (13.9 | ) | $ | (136.0 | ) | $ | (120.7 | ) | $ | (142.6 | ) | |||||||||
In the second quarter of 2012, the Company completed its negotiation with GM to determine the amount of pension assets to be transferred from the Company to GM as required by the Asset Purchase Agreement. The Company transferred $18.8 million of plan assets to GM to settle this obligation. | |||||||||||||||||||||||||
In the fourth quarter of 2012, the Company and the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (“UAW”) Local 933 entered into a new five year collective bargaining agreement that expires in November 2017. The multi-tiered wage and benefit structure from the prior agreement was retained and the parties agreed to additional changes, such as implementing a new retirement health care plan and eliminating the consumer price index based cost of living allowance that had been part of the prior agreement. As a result, the Company recorded a $28.9 million favorable adjustment to the net benefit obligation. | |||||||||||||||||||||||||
The Company’s pension plan assets consist of money market funds, mutual funds and listed equities. The Company’s valuation techniques used to fair value pension plan assets represents a market approach in active markets for identical assets that qualifies as Level 1 in the fair value hierarchy. | |||||||||||||||||||||||||
The fair values of plan assets for the Company’s pension plans as of December 31, 2014 and 2013 are as follows (dollars in millions): | |||||||||||||||||||||||||
Quoted Prices in Active Markets | |||||||||||||||||||||||||
for Identical Assets (Level 1) | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Asset Category | Fair Value | % | Fair Value | % | |||||||||||||||||||||
Cash and cash equivalents | $ | 8.6 | 6 | % | $ | 3.6 | 3 | % | |||||||||||||||||
Diversified equity securities | 57.8 | 43 | 51.5 | 48 | |||||||||||||||||||||
Diversified debt securities | 68.9 | 51 | 53.5 | 49 | |||||||||||||||||||||
Total | $ | 135.3 | 100 | % | $ | 108.6 | 100 | % | |||||||||||||||||
The Company’s investment strategy with respect to pension plan assets is to invest the assets in accordance with laws and regulations. The long-term primary objectives for the Company’s pension assets are to provide results that meet or exceed the plans’ actuarially assumed long-term rate of return without subjecting the funds to undue risk. To achieve these objectives the Company has established the following targets: | |||||||||||||||||||||||||
Target | |||||||||||||||||||||||||
Asset Category | Hourly | Salary | |||||||||||||||||||||||
Cash and cash equivalents | 5 | % | 8 | % | |||||||||||||||||||||
Diversified equity securities | 39 | 46 | |||||||||||||||||||||||
Diversified debt securities | 56 | 46 | |||||||||||||||||||||||
Total | 100 | % | 100 | % | |||||||||||||||||||||
Through 2014, the Company’s investment committee has continued to evaluate the investments and take steps toward the established targets. | |||||||||||||||||||||||||
The following table discloses the amounts recognized in the balance sheet and in AOCL at December 31, 2014 and 2013, on a pre-tax basis (dollars in millions): | |||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Amounts Recognized in Balance Sheet: | |||||||||||||||||||||||||
Noncurrent assets | $ | 7.9 | $ | 7.4 | $ | — | $ | — | |||||||||||||||||
Current liabilities | — | — | (1.2 | ) | (1.4 | ) | |||||||||||||||||||
Noncurrent liabilities | (6.1 | ) | (4.7 | ) | (134.8 | ) | (119.3 | ) | |||||||||||||||||
Total asset (liability) | $ | 1.8 | $ | 2.7 | $ | (136.0 | ) | $ | (120.7 | ) | |||||||||||||||
Accumulated Other Comprehensive Loss: | |||||||||||||||||||||||||
Prior service (cost) credit | $ | (0.1 | ) | $ | (0.2 | ) | $ | 21.7 | $ | 25.4 | |||||||||||||||
Actuarial gain | 0.6 | 2.7 | 8.6 | 17.1 | |||||||||||||||||||||
Total | $ | 0.5 | $ | 2.5 | $ | 30.3 | $ | 42.5 | |||||||||||||||||
The amounts in AOCL expected to be amortized and recognized as a component of net periodic benefit cost in 2015 are as follows (dollars in millions): | |||||||||||||||||||||||||
2015 | |||||||||||||||||||||||||
Pension | Post-retirement | ||||||||||||||||||||||||
Plans | Benefits | ||||||||||||||||||||||||
Prior service (cost) credit | $ | (1.0 | ) | $ | 3.6 | ||||||||||||||||||||
Actuarial loss | 1 | — | |||||||||||||||||||||||
Total | $ | 0 | $ | 3.6 | |||||||||||||||||||||
The accumulated benefit obligation for the Company’s pension plans as of December 31, 2014 and 2013 was $129.7 million and $103.1 million, respectively. | |||||||||||||||||||||||||
As of December 31, 2014 and 2013, the projected benefit obligation, the accumulated benefit obligation, and the fair value of plan assets for pension plans with a projected benefit obligation in excess of plan assets and for pension plans with an accumulated benefit obligation in excess of plan assets were as follows (dollars in millions): | |||||||||||||||||||||||||
Hourly Plan | Salary Plan | ||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Plans with projected benefit obligation in excess of plan assets: | |||||||||||||||||||||||||
Projected benefit obligation | N/A | 1 | N/A | 1 | $ | 71.4 | $ | 53.8 | |||||||||||||||||
Fair value of plan assets | N/A | 1 | N/A | 1 | $ | 65.3 | $ | 49.1 | |||||||||||||||||
Plans with accumulated benefit obligation in excess of plan assets: | |||||||||||||||||||||||||
Accumulated benefit obligation | N/A | 1 | N/A | 1 | $ | 67.6 | $ | 50.9 | |||||||||||||||||
Fair value of plan assets | N/A | 1 | N/A | 1 | $ | 65.3 | $ | 49.1 | |||||||||||||||||
1 | As of December 31, 2014 and 2013, the hourly defined benefit pension plan had plan assets greater than both the projected benefit obligation and accumulated benefit obligation. | ||||||||||||||||||||||||
Information about expected cash flows for the Company’s pension and post-retirement benefit plans is as follows (dollars in millions): | |||||||||||||||||||||||||
Pension | Post-retirement | ||||||||||||||||||||||||
Plans | Benefits | ||||||||||||||||||||||||
Employer Contributions: | |||||||||||||||||||||||||
2015 expected contributions | $ | 2 | $ | 1.2 | |||||||||||||||||||||
Expected Benefit Payments: | |||||||||||||||||||||||||
2015 | 2.3 | 1.2 | |||||||||||||||||||||||
2016 | 3 | 1.7 | |||||||||||||||||||||||
2017 | 3.8 | 2.4 | |||||||||||||||||||||||
2018 | 4.6 | 3.2 | |||||||||||||||||||||||
2019 | 5.5 | 3.9 | |||||||||||||||||||||||
2020-2024 | 40.6 | 27.7 | |||||||||||||||||||||||
Expected benefit payments for pension and post-retirement benefits will be paid from plan trusts or corporate assets. The Company’s funding policy is to contribute amounts annually that are at least equal to the amounts required by applicable laws and regulations or to directly fund payments to plan participants. Additional discretionary contributions will be made when deemed appropriate to meet the Company’s long-term obligation to the plans. | |||||||||||||||||||||||||
In June 2012, the Company established a non-qualified deferred compensation plan (“Deferred Compensation Plan”) for a select group of management. Under the terms of the plan, the Company has utilized a rabbi trust to accumulate assets to fund its promise to pay benefits under the Deferred Compensation Plan. The rabbi trust is an irrevocable trust, which restricts any use of funds (operational or otherwise) by the Company other than to pay benefits under the Deferred Compensation Plan, and prevents immediate taxation of contributed amounts. Funds are accumulated through both employee deferrals and a company match. Funds can be invested by the employee into a diversified group of investment options, which have been selected by the Company’s investment committee, that are all categorized as Level 1 in the fair value hierarchy. The company match resulted in a charge of $0.2 million, $0.3 million, and $0.1 million to the Consolidated Statements of Comprehensive Income for the years ended December 31, 2014, 2013 and 2012, respectively, and the fair value of the rabbi trust plan assets and deferred compensation obligation was $2.9 million and $1.3 million as of December 31, 2014 and 2013, respectively. |
STOCKBASED_COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
STOCK-BASED COMPENSATION | NOTE 14. | STOCK-BASED COMPENSATION | |||||||||||
In March 2012, the Company’s Board of Directors adopted and the Company’s stockholders approved the Allison Transmission Holdings, Inc. 2011 Equity Incentive Award Plan (“2011 Plan”), which became effective as of the day prior to the consummation of the Company’s initial public offering. Under the 2011 Plan, certain employees (including executive officers), consultants and directors are eligible to receive equity-based compensation, including non-qualified stock options, incentive stock options, restricted stock, dividend equivalents, stock payments, restricted stock units (“RSU”), performance awards, stock appreciation rights and other equity-based awards, or any combination thereof. The 2011 Plan limits the aggregate number of shares of common stock available for issue to 15.3 million and will expire on, and no option or other equity award may be granted pursuant to the 2011 Plan after, the tenth anniversary of the date the 2011 Plan was approved by the Board of Directors. | |||||||||||||
Prior to the adoption of the 2011 Plan, the Company’s equity-based awards were granted under the Equity Incentive Plan of Allison Transmission Holdings, Inc. (“Prior Plan”). As of the effective date of the 2011 Plan, no new awards will be granted under the Prior Plan, but the Prior Plan will continue to govern the equity awards issued under the Prior Plan. | |||||||||||||
Restricted Stock Units | |||||||||||||
RSUs were issued to certain employees in 2014, 2013 and 2012, and certain directors in 2014 and 2013 under the 2011 Plan at fair market value at the date of grant. These awards entitle the holder to receive one common share for each RSU upon vesting, which generally occurs over either one, two or three years upon continued performance of services by the RSU holders. A summary of RSU activity as of December 31, 2014, 2013 and 2012, and changes during the period then ended is presented below: | |||||||||||||
Non-vested RSUs: | RSUs | Weighted-Average | |||||||||||
(in millions) | Grant-Date | ||||||||||||
Fair Value | |||||||||||||
Non-vested as of December 31, 2011 | — | $ | — | ||||||||||
Granted | 1 | 20.2 | |||||||||||
Vested | — | — | |||||||||||
Forfeited | — | — | |||||||||||
Non-vested as of December 31, 2012 | 1 | $ | 20.2 | ||||||||||
Granted | 0.2 | 23.31 | |||||||||||
Vested | (0.4 | ) | 20.23 | ||||||||||
Forfeited | — | — | |||||||||||
Non-vested as of December 31, 2013 | 0.8 | $ | 20.9 | ||||||||||
Granted | 0 | 29.85 | |||||||||||
Vested | (0.6 | ) | 20.32 | ||||||||||
Forfeited | — | — | |||||||||||
Non-vested as of December 31, 2014 | 0.2 | $ | 26.57 | ||||||||||
As of December 31, 2014 and 2013, there were $3.0 million and $10.4 million, respectively, of unrecognized compensation cost related to non-vested RSU compensation arrangements granted under the 2011 Plan. This cost is expected to be recognized, on a straight line basis, over a period of approximately two years. RSU incentive compensation expense recorded was $9.8 million, $12.0 million and $0.9 million for the years ended December 31, 2014, 2013 and 2012, respectively. The total fair value of RSUs vested during the years ended December 31, 2014, 2013 and 2012 was approximately $20.2 million, $9.0 million and $0.0 million, respectively. | |||||||||||||
Pursuant to the share withholding provisions of the 2011 Plan and the related RSU award agreement, certain employees, in lieu of paying withholding taxes on the vesting of RSUs, authorized the withholding of an aggregate of approximately 0.3 million and 0.1 million shares, respectively of the Company’s common stock to satisfy their minimum statutory tax withholding requirements related to such vesting events during 2014 and 2013. The withheld shares were recorded as a reduction to equity on the applicable vesting dates of approximately $8.4 million and $3.6 million during 2014 and 2013, respectively. | |||||||||||||
Restricted Stock | |||||||||||||
Restricted stock was granted to certain employees in 2014 under the 2011 Plan at fair market value on the date of grant. The restrictions lapse upon continued performance by the restricted stock holders on the vest date which generally occurs over one, two or three years. A summary of restricted stock activity as of December 31, 2014 and changes during the period then ended is presented below: | |||||||||||||
Non-vested Shares: | Restricted | Weighted-Average | |||||||||||
Stock | Grant-Date Fair | ||||||||||||
(in millions) | Value | ||||||||||||
Non-vested as of December 31, 2013 | — | $ | — | ||||||||||
Granted | 0.2 | 29.47 | |||||||||||
Vested | — | — | |||||||||||
Forfeited | — | — | |||||||||||
Non-vested as of December 31, 2014 | 0.2 | $ | 29.47 | ||||||||||
As of December 2014, there was $3.4 million of unrecognized compensation cost related to non-vested restricted stock compensation arrangements granted under the 2011 Plan. This cost is expected to be recognized, on a straight line basis, over a period of approximately 2 years. Restricted stock incentive compensation expense recorded was $1.6 million for the year ended December 31, 2014. | |||||||||||||
Stock Options | |||||||||||||
Stock options granted under the Prior Plan after the completion of the Acquisition Transaction and through March 2012, have a per share exercise price based on the fair market value of the Company at the date of grant. Stock options granted under the 2011 Plan have a per share exercise price based on the closing price of a share of the Company’s common stock as reported by the NYSE on the date of grant. All stock options expire 10 years after the grant date. The options vest upon the continued performance of services by the option holder over time, with either 20% or 33% of the award vesting on each anniversary of the grant date over three to five years for awards under the Prior Plan and 100% in December of the year that is two years after the year of grant under the 2011 Plan. Upon termination of employment for reasons other than cause, retirement before the age of 65 with less than 90 points (calculated as age plus years of service), death or disability, the options shall cease to be exercisable ninety days following the date of the optionees’ termination of service. Upon termination of employment for cause, the options shall not be exercisable on the date of such termination. Upon termination of employment for retirement at or after the age of 65, the options shall cease to be exercisable three years following such date. Upon termination of employment for retirement before the age of 65 with 90 or more points, the options shall cease to be exercisable two years following such date. Upon termination of employment for death or disability, the options shall cease to be exercisable twelve months following such date. | |||||||||||||
In accordance with the FASB’s authoritative accounting guidance on stock compensation, each option grant is to be recorded at fair value. When options are granted, the Company uses a Black-Scholes option pricing model to calculate the fair value of each option award using the assumptions noted in the following table: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Expected volatility | 38 | % | 51 | % | N/A | ||||||||
Expected dividend yield | 1.6 | % | 1.2 | % | N/A | ||||||||
Expected term (in years) | 5.5 | 5.4 | N/A | ||||||||||
Expected forfeitures | 0 | % | 0 | % | N/A | ||||||||
Risk-free rate | 1.7 | % | 1.6 | % | N/A | ||||||||
Expected volatility is based on “the average volatilities of otherwise similar public entities” as defined by authoritative accounting guidance. The Company currently pays a $0.15 dividend per quarter. The expected term is derived from the average of the weighted vesting life and the contractual term. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. | |||||||||||||
A summary of option activity as of December 31, 2014, 2013 and 2012, and changes during the period then ended is presented below: | |||||||||||||
Options | Weighted- | Weighted-Average | |||||||||||
(in millions) | Average Exercise | Remaining | |||||||||||
Price | Contractual Term | ||||||||||||
Outstanding as of December 31, 2011 | 14.9 | $ | 13.4 | 4.94 years | |||||||||
Exercisable as of December 31, 2011 | 11.5 | $ | 13.37 | 4.88 years | |||||||||
Granted | — | — | |||||||||||
Exercised | (2.7 | ) | — | ||||||||||
Forfeited or expired | (0.3 | ) | — | ||||||||||
Outstanding as of December 31, 2012 | 11.9 | $ | 14.01 | 4.93 years | |||||||||
Exercisable as of December 31, 2012 | 11.8 | $ | 14.02 | 4.91 years | |||||||||
Granted | 0.6 | $ | 23.39 | ||||||||||
Exercised | (3.8 | ) | — | ||||||||||
Forfeited or expired | — | — | |||||||||||
Outstanding as of December 31, 2013 | 8.7 | $ | 15.33 | 4.30 years | |||||||||
Exercisable as of December 31, 2013 | 8.1 | $ | 14.79 | 3.94 years | |||||||||
Granted | 0.4 | $ | 30.23 | ||||||||||
Exercised | (4.2 | ) | — | ||||||||||
Forfeited or expired | — | — | |||||||||||
Outstanding as of December 31, 2014 | 4.9 | $ | 17.49 | 4.19 years | |||||||||
Exercisable as of December 31, 2014 | 3.9 | $ | 15.32 | 3.08 years | |||||||||
The weighted-average grant-date fair value of options granted during the years ended December 31, 2014, 2013 and 2012 was $9.51, $9.76 and $0.0, respectively. The total fair value of stock options vested during the years ended December 31, 2014, 2013 and 2012 was $0.0 million, $0.7 million and $7.5 million, respectively. The total intrinsic value of stock options exercised during the years ended December 31, 2014, 2013 and 2012 was $82.3 million, $58.0 million and $24.6 million, respectively. The aggregate intrinsic value of stock options outstanding and exercisable was $80.4 million and $72.5 million as of December 31, 2014, and $106.8 million and $103.8 million as of December 31, 2013, respectively. | |||||||||||||
A summary of the status of the Company’s non-vested stock options as of December 31, 2014, 2013 and 2012, and changes during the period ended December 31, 2014, 2013 and 2012 is presented below: | |||||||||||||
Non-vested Stock Options: | Options | Weighted-Average | |||||||||||
(in millions) | Grant-Date | ||||||||||||
Fair Value | |||||||||||||
Non-vested at December 31, 2011 | 3.4 | $ | 2.81 | ||||||||||
Granted | — | — | |||||||||||
Vested | (2.9 | ) | 2.58 | ||||||||||
Forfeited | (0.3 | ) | 4 | ||||||||||
Non-vested at December 31, 2012 | 0.2 | $ | 4.34 | ||||||||||
Granted | 0.6 | 9.76 | |||||||||||
Vested | (0.2 | ) | 3.59 | ||||||||||
Forfeited | — | — | |||||||||||
Non-vested at December 31, 2013 | 0.6 | $ | 9.06 | ||||||||||
Granted | 0.4 | 9.51 | |||||||||||
Vested | — | — | |||||||||||
Forfeited | — | — | |||||||||||
Non-vested at December 31, 2014 | 1 | $ | 9.44 | ||||||||||
As of December 31, 2014, 2013 and 2012, there was $4.8 million, $4.2 million and $0.5 million, respectively, of unrecognized compensation cost related to non-vested stock option compensation arrangements granted under the Prior Plan and the 2011 Plan. This cost is expected to be recognized, on a straight line basis, over a period of approximately two years. Stock option incentive compensation expense recorded was $3.3 million, $1.7 million and $5.5 million for the years ended December 31, 2014, 2013 and 2012, respectively. |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
INCOME TAXES | NOTE 15. | INCOME TAXES | |||||||||||
Income before income taxes included the following (dollars in millions): | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
U.S. income | $ | 355.1 | $ | 259 | $ | 204.1 | |||||||
Foreign income | 13 | 7.1 | 12.1 | ||||||||||
Total | $ | 368.1 | $ | 266.1 | $ | 216.2 | |||||||
The provision for income tax expense (benefit) was estimated as follows (dollars in millions): | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Estimated current income taxes: | |||||||||||||
U.S. federal | $ | 1.6 | $ | 0.2 | $ | 1.5 | |||||||
Foreign | 6.3 | 1.9 | 3.9 | ||||||||||
U.S. state and local | (0.2 | ) | 0.6 | 0.4 | |||||||||
Total Current | 7.7 | 2.7 | 5.8 | ||||||||||
Deferred income tax expense (credit), net: | |||||||||||||
U.S. federal | 125.6 | 87.6 | (282.5 | ) | |||||||||
Foreign | (0.3 | ) | 0.1 | 0.1 | |||||||||
U.S. state and local | 6.5 | 10.3 | (21.4 | ) | |||||||||
Total Deferred | 131.8 | 98 | (303.8 | ) | |||||||||
Total income tax expense (benefit) | $ | 139.5 | $ | 100.7 | $ | (298.0 | ) | ||||||
Cash paid for income taxes for the years ended December 31, 2014, 2013 and 2012 was $5.0 million, $3.8 million and $10.7 million, respectively. | |||||||||||||
A reconciliation of the provision for income tax expense (benefit) compared with the amounts at the U.S. federal statutory rate is as follows (dollars in millions): | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Tax at U.S. statutory income tax rate | $ | 128.9 | $ | 93.1 | $ | 75.7 | |||||||
Foreign rate differential | (2.3 | ) | (0.7 | ) | (2.6 | ) | |||||||
Non-deductible expenses | 3.9 | 0.8 | 4.2 | ||||||||||
Valuation allowance | 2.6 | 1 | (384.1 | ) | |||||||||
State tax expense | 4 | 7.3 | 5.7 | ||||||||||
Adjustment to deferred tax expense | 2.4 | (0.3 | ) | 2.2 | |||||||||
Other adjustments | (0.0 | ) | (0.5 | ) | 0.9 | ||||||||
Total income tax expense (benefit) | $ | 139.5 | $ | 100.7 | $ | (298.0 | ) | ||||||
The Company has not recognized any deferred tax liabilities associated with investments and earnings in foreign subsidiaries as they are intended to be permanent in duration. Such amounts may become taxable upon an actual or deemed repatriation in the future; however, at this time, management believes any related unrecognized deferred tax liability is immaterial. | |||||||||||||
Temporary differences and carryforwards that gave rise to deferred tax assets and liabilities included the following (dollars in millions): | |||||||||||||
As of | As of | ||||||||||||
December 31, | December 31, | ||||||||||||
2014 | 2013 | ||||||||||||
Deferred tax assets: | |||||||||||||
Inventories | $ | 5.1 | $ | 4.6 | |||||||||
Warranty accrual | 30.5 | 32.7 | |||||||||||
Sales allowances and rebates | 6.7 | 7.9 | |||||||||||
Deferred revenue | 25.7 | 24 | |||||||||||
Post-retirement health care | 5.7 | — | |||||||||||
Intangibles | 77.3 | 83.6 | |||||||||||
Other accrued liabilities | 32.7 | 27.2 | |||||||||||
Unrealized loss on interest rate derivatives | 5.7 | 3.7 | |||||||||||
Operating loss carryforwards | 107.8 | 140.7 | |||||||||||
Stock based compensation | 6.9 | 12.5 | |||||||||||
Technology-related investments | 6.6 | 6.8 | |||||||||||
Loan fees | — | 0.9 | |||||||||||
Other | 16.4 | 10.4 | |||||||||||
Total Deferred tax assets | 327.1 | 355 | |||||||||||
Valuation allowances | (5.2 | ) | (2.8 | ) | |||||||||
Deferred tax liabilities: | |||||||||||||
Property, plant and equipment | (20.2 | ) | (22.0 | ) | |||||||||
Goodwill | (320.8 | ) | (280.3 | ) | |||||||||
Trade name | (90.3 | ) | (60.6 | ) | |||||||||
Product warranty liabilities | (4.3 | ) | (5.6 | ) | |||||||||
Pension | — | (0.5 | ) | ||||||||||
Post-retirement health care | — | (0.2 | ) | ||||||||||
Other | (3.5 | ) | — | ||||||||||
Total Deferred tax liabilities | (439.1 | ) | (369.2 | ) | |||||||||
Net Deferred tax liability | $ | (117.2 | ) | $ | (17.0 | ) | |||||||
Of the estimated net operating loss carryforwards as of December 31, 2014, approximately 91% relates to U.S. federal net operating loss carryforwards and approximately 9% relates to the U.S. state net operating loss carryforwards. Substantially all U.S. Federal and State operating loss carryforwards will not expire until 2027-2032. As of December 31, 2014, the Company had $253.3 million of net operating loss carryforwards for U.S. federal income tax purposes. If the Company continues to generate taxable income, it expects to utilize the remaining U.S. federal net operating loss carryforwards as early as the first quarter of 2016. | |||||||||||||
Management has determined, based on an evaluation of available objective and subjective evidence, that it is more likely than not that certain foreign deferred tax assets will not be realized and therefore continue to offset these deferred tax assets with a valuation allowance of $5.2 million and $2.8 million as of December 31, 2014 and 2013, respectively. | |||||||||||||
In accordance with the FASB’s authoritative guidance on accounting for uncertainty in income taxes, the Company has recorded a liability for unrecognized tax benefits related to the 2010 Research & Development Credit. The accounting guidance prescribes a recognition threshold and measurement attributes for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Management does not anticipate any significant changes in the balance within the coming year. All of the Company’s returns (when filed) will remain subject to examination by the various taxing authorities for the duration of the applicable statute of limitations (generally three years from the earlier of the date of filing or the due date of the return). The change in the liability for unrecognized tax benefits are as follows (dollars in millions): | |||||||||||||
December 31, 2012 | $ | — | |||||||||||
December 31, 2013 | $ | 2.3 | |||||||||||
Increases in unrecognized tax benefits as a result of current year activity | 0.2 | ||||||||||||
December 31, 2014 | $ | 2.5 | |||||||||||
For the years ended December 31, 2014, 2013 and 2012, the Company recognized no interest and penalties in the Consolidated Statements of Comprehensive Income. The Company follows a policy of recording any tax related interest or penalties in Income tax expense. |
OTHER_COMPREHENSIVE_LOSS
OTHER COMPREHENSIVE LOSS | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
OTHER COMPREHENSIVE LOSS | NOTE 16. | OTHER COMPREHENSIVE LOSS | |||||||||||
The changes in components of accumulated other comprehensive loss consisted of the following (dollars in millions): | |||||||||||||
Before Tax | Tax (Expense) | After Tax | |||||||||||
Benefit | |||||||||||||
Balance at December 31, 2011 | $ | (33.2 | ) | $ | (23.8 | ) | $ | (57.0 | ) | ||||
Foreign currency translation | (0.7 | ) | — | (0.7 | ) | ||||||||
Pension and OPEB liability adjustment | 26.7 | (11.6 | ) | 15.1 | |||||||||
Available-for-sale securities | (2.0 | ) | 0.7 | (1.3 | ) | ||||||||
Net current period other comprehensive loss | $ | 24 | $ | (10.9 | ) | $ | 13.1 | ||||||
Balance at December 31, 2012 | $ | (9.2 | ) | $ | (34.7 | ) | $ | (43.9 | ) | ||||
Foreign currency translation | (5.0 | ) | — | (5.0 | ) | ||||||||
Pension and OPEB liability adjustment | 46.4 | (17.4 | ) | 29 | |||||||||
Available-for-sale securities | (1.9 | ) | 0.8 | (1.1 | ) | ||||||||
Net current period other comprehensive income | $ | 39.5 | $ | (16.6 | ) | $ | 22.9 | ||||||
Balance at December 31, 2013 | $ | 30.3 | $ | (51.3 | ) | $ | (21.0 | ) | |||||
Foreign currency translation | (7.4 | ) | — | (7.4 | ) | ||||||||
Pension and OPEB liability adjustment | (14.6 | ) | 5.5 | (9.1 | ) | ||||||||
Available-for-sale securities | (3.2 | ) | 1.2 | (2.0 | ) | ||||||||
Net current period other comprehensive loss | $ | (25.2 | ) | $ | 6.7 | $ | (18.5 | ) | |||||
Balance at December 31, 2014 | $ | 5.1 | $ | (44.6 | ) | $ | (39.5 | ) | |||||
The following table shows the location in the Consolidated Statements of Comprehensive Income affected by reclassifications from AOCL (dollars in millions): | |||||||||||||
For the year ended December 31, 2014 | |||||||||||||
AOCL Components | Amount | Affected line item in the consolidated | |||||||||||
reclassified from | statements of comprehensive income | ||||||||||||
AOCL | |||||||||||||
Amortization of defined benefit pension items: | |||||||||||||
Prior service cost | $ | 3.2 | Cost of sales | ||||||||||
0.3 | Selling, general and | ||||||||||||
administrative | |||||||||||||
0.1 | Engineering – research and | ||||||||||||
development | |||||||||||||
Actuarial loss | 0.7 | Cost of sales | |||||||||||
(0.0 | ) | Selling, general and | |||||||||||
administrative | |||||||||||||
(0.0 | ) | Engineering – research and | |||||||||||
development | |||||||||||||
Total reclassifications, before tax | 4.3 | Income before income | |||||||||||
taxes | |||||||||||||
Income tax expense | (1.6 | ) | Tax expense | ||||||||||
Total reclassifications | $ | 2.7 | Net of tax | ||||||||||
Prior service cost and actuarial loss are included in the computation of the Company’s net periodic benefit cost. Please see NOTE 13 for additional details. |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
COMMITMENTS AND CONTINGENCIES | NOTE 17. | COMMITMENTS AND CONTINGENCIES | |||
Operating Leases | |||||
The Company leases certain facilities under various operating leases. Rent expense under the non-cancelable operating leases was $5.4 million, $5.7 million, and $5.5million for the years ended December 31, 2014, 2013 and 2012, respectively. Certain leases contain renewal options. | |||||
As of December 31, 2014, future payments under non-cancelable operating leases are as follows over each of the next five years and thereafter (dollars in millions): | |||||
2015 | $ | 4.6 | |||
2016 | 2.8 | ||||
2017 | 1.7 | ||||
2018 | 0.8 | ||||
2019 | 0.6 | ||||
Thereafter | 2 | ||||
Total | $ | 12.5 | |||
Claims, Disputes, and Litigation | |||||
The Company is party to various legal actions and administrative proceedings and subject to various claims arising in the ordinary course of business. These proceedings primarily involve commercial claims, product liability claims, personal injury claims and workers’ compensation claims. The Company believes that the ultimate liability, if any, in excess of amounts already provided for in the consolidated financial statements or covered by insurance on the disposition of these matters will not have a material adverse effect on the financial position, results of operations or cash flows of the Company. |
CONCENTRATION_OF_RISK
CONCENTRATION OF RISK | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
CONCENTRATION OF RISK | NOTE 18. | CONCENTRATION OF RISK | |||||||||||
As of December 31, 2014 and 2013, the Company employed approximately 2,700 employees, respectively with 90% of those employees in the U.S. Approximately 60% of the Company’s U.S. employees were represented by unions and subject to a collective bargaining agreement as of December 31, 2014 and 2013. In addition, many of the hourly employees outside the U.S. are represented by various unions. The Company is currently operating under a collective bargaining agreement with the UAW Local 933 that expires in November 2017. | |||||||||||||
Three customers accounted for greater than 10% of net sales within the last three years presented. | |||||||||||||
Years ended December 31, | |||||||||||||
% of net sales | 2014 | 2013 | 2012 | ||||||||||
Daimler AG | 17 | % | 17 | % | 13 | % | |||||||
Navistar, Inc. | 10 | % | 10 | % | 11 | % | |||||||
Oshkosh Corporation | 4 | % | 8 | % | 11 | % | |||||||
No other customers accounted for more than 10% of net sales of the Company during the years ended December 31, 2014, 2013 or 2012. | |||||||||||||
Three customers accounted for greater than 10% of outstanding accounts receivable within the last two years presented. | |||||||||||||
% of accounts receivable | As of | As of | |||||||||||
December 31, | December 31, | ||||||||||||
2014 | 2013 | ||||||||||||
Daimler AG | 15 | % | 15 | % | |||||||||
Navistar, Inc. | 12 | % | 10 | % | |||||||||
AB Volvo. | 8 | % | 11 | % | |||||||||
No other customers accounted for more than 10% of the outstanding accounts receivable as of December 31, 2014 or December 31, 2013. | |||||||||||||
One supplier accounted for greater than 10% of materials purchased for the periods presented: | |||||||||||||
Years ended December 31, | |||||||||||||
% of material purchased | 2014 | 2013 | 2012 | ||||||||||
Linamar Corporation Inc. | 10 | % | 13 | % | 13 | % | |||||||
No other supplier accounted for more than 10% of materials purchased during the years ended December 31, 2014, 2013 or 2012. |
CERTAIN_RELATIONSHIPS_AND_RELA
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | 12 Months Ended | |
Dec. 31, 2014 | ||
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | NOTE 19. | CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS |
Investment funds affiliated with the Sponsors sold their common stock through a series of public offerings from March 2012 through September 2014. As of December 31, 2014, investment funds affiliated with the Sponsors no longer own any shares of the Company’s outstanding common stock. Pursuant to an amended and restated stockholders agreement, a majority of the Board of Directors had previously been designated by the Sponsors; however, as a result of their no longer owning any shares of the Company’s common stock, the Sponsors no longer have the right to designate members of the Board of Directors. | ||
Senior Notes Held by Executive Officers | ||
As of December 31, 2014, Lawrence E. Dewey, our Chairman, President and Chief Executive Officer, and David S. Graziosi, our Executive Vice President, Chief Financial Officer and Treasurer, held approximately $100,000 and $450,000, respectively, in aggregate principal amount of the 7.125% Senior Notes. | ||
Repurchase of Common Stock held by Sponsors | ||
During 2014, the Company completed four secondary public offerings in September, June, April and February of 5,392,499, 40,250,000, 25,000,000, and 28,750,000 shares of its common stock held by investment funds affiliated with the Sponsors at public offering prices, less underwriting discounts and commissions, of $30.46, $29.95, $29.78 and $29.17 per share, respectively. In connection with certain of the offerings, the Company repurchased from the underwriters 5,000,000 shares in June 2014 and 3,428,179 shares in February 2014 at the prices paid by the underwriters and subsequently retired those shares. | ||
During 2013, the Company completed three secondary public offerings in August, November and December of 23,805,000, 15,000,000 and 12,500,000 shares of its common stock held by investment funds affiliated with the Sponsors at a public offering price, less underwriting discounts and commissions, of $21.18, $23.10 and $25.56 per share, respectively. In connection with the offering in August, the Company repurchased from the underwriters 4,700,000 shares of the 23,805,000 shares at the price paid by the underwriters and subsequently retired those shares. |
COMMON_STOCK
COMMON STOCK | 12 Months Ended | |
Dec. 31, 2014 | ||
COMMON STOCK | NOTE 20. | COMMON STOCK |
The Company’s current stock repurchase program was announced on October 30, 2014. The Board authorized management to repurchase up to $500.0 million of its common stock on the open market or through privately negotiated transactions through December 31, 2016. The timing and amount of stock purchases are subject to market conditions and corporate needs. This stock repurchase program may be extended, modified, suspended or discontinued at any time at the Company’s discretion. As of December 31, 2014, $500.0 million remained available for stock repurchases under the repurchase program. |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
EARNINGS PER SHARE | NOTE 21. | EARNINGS PER SHARE | |||||||||||
The Company presents both basic and diluted earnings per share (“EPS”) amounts. Basic EPS is calculated by dividing net income by the weighted average number of common shares outstanding during the reporting period. Diluted EPS is calculated by dividing net income by the weighted average number of common shares and common equivalent shares outstanding during the reporting period that are calculated using the treasury stock method for stock-based awards. The treasury stock method assumes that the Company uses the proceeds from the exercise of awards to repurchase common stock at the average market price during the period. The assumed proceeds under the treasury stock method include the purchase price that the grantee will pay in the future, compensation cost for future service that the Company has not yet recognized and any tax benefits that would be credited to additional paid-in-capital when the award generates a tax deduction. If there would be a shortfall resulting in a charge to additional paid-in-capital, such an amount would be a reduction of the proceeds to the extent of the gains. The diluted weighted-average common shares outstanding exclude the anti-dilutive effect of certain stock options since such options had an exercise price in excess of the monthly average market value of our common stock. As of December 31, 2014, there were no outstanding anti-dilutive stock options. | |||||||||||||
The following table reconciles the numerators and denominators used to calculate basic EPS and diluted EPS (in millions, except per share data): | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income | $ | 228.6 | $ | 165.4 | $ | 514.2 | |||||||
Weighted average shares of common stock outstanding | 179.8 | 184.5 | 182 | ||||||||||
Dilutive effect stock-based awards | 2.5 | 3.4 | 4.2 | ||||||||||
Diluted weighted average shares of common stock outstanding | 182.3 | 187.9 | 186.2 | ||||||||||
Basic earnings per share attributable to common stockholders | $ | 1.27 | $ | 0.9 | $ | 2.83 | |||||||
Diluted earnings per share attributable to common stockholders | $ | 1.25 | $ | 0.88 | $ | 2.76 | |||||||
GEOGRAPHIC_INFORMATION
GEOGRAPHIC INFORMATION | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
GEOGRAPHIC INFORMATION | NOTE 22. | GEOGRAPHIC INFORMATION | |||||||||||
The Company had the following net sales by country as follows (dollars in millions): | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States | $ | 1,578.00 | $ | 1,354.30 | $ | 1,509.60 | |||||||
China | 128.7 | 141 | 136.4 | ||||||||||
Canada | 85.1 | 88.6 | 123 | ||||||||||
Japan | 45.8 | 37 | 52 | ||||||||||
Germany | 38.1 | 53.9 | 39.1 | ||||||||||
United Kingdom | 36.8 | 42.5 | 74.1 | ||||||||||
Other | 214.9 | 209.5 | 207.6 | ||||||||||
Total | $ | 2,127.40 | $ | 1,926.80 | $ | 2,141.80 | |||||||
The Company had net long-lived assets by country as follows (dollars in millions): | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States | $ | 442.6 | $ | 478.7 | $ | 493.6 | |||||||
India | 51.5 | 59.9 | 76.8 | ||||||||||
Hungary | 15.1 | 18.1 | 18.4 | ||||||||||
Others | 5.4 | 6.7 | 7.4 | ||||||||||
Total | $ | 514.6 | $ | 563.4 | $ | 596.2 | |||||||
QUARTERLY_FINANCIAL_INFORMATIO
QUARTERLY FINANCIAL INFORMATION | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
QUARTERLY FINANCIAL INFORMATION | NOTE 23. QUARTERLY FINANCIAL INFORMATION | ||||||||||||||||
The following is a summary of the unaudited quarterly results of operations. The Company believes that all adjustments considered necessary for a fair presentation in accordance with GAAP have been included (unaudited, in millions, except per share data). | |||||||||||||||||
Quarters ended, | |||||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||||
2014 | |||||||||||||||||
Net sales | $ | 493.6 | $ | 536.1 | $ | 553.3 | $ | 544.4 | |||||||||
Gross profit | 222.5 | 238.5 | 259.3 | 255.6 | |||||||||||||
Operating income | 114.8 | 132.2 | 147.3 | 117.8 | |||||||||||||
Income before income taxes | 79.3 | 94.7 | 116.3 | 77.8 | |||||||||||||
Net income | 52.1 | 57.2 | 68.8 | 50.5 | |||||||||||||
Basic earnings per share | $ | 0.29 | $ | 0.32 | $ | 0.38 | $ | 0.28 | |||||||||
Diluted earnings per share | $ | 0.28 | $ | 0.31 | $ | 0.38 | $ | 0.28 | |||||||||
2013 | |||||||||||||||||
Net sales | $ | 457.4 | $ | 512.1 | $ | 466.3 | $ | 491 | |||||||||
Gross profit | 198.3 | 226.1 | 206.1 | 211.4 | |||||||||||||
Operating income | 81.4 | 117.7 | 111.2 | 99.6 | |||||||||||||
Income before income taxes | 44.4 | 81.8 | 72.4 | 67.5 | |||||||||||||
Net income | 27.5 | 50.5 | 44.5 | 42.9 | |||||||||||||
Basic earnings per share | $ | 0.15 | $ | 0.27 | $ | 0.24 | $ | 0.24 | |||||||||
Diluted earnings per share | $ | 0.15 | $ | 0.26 | $ | 0.24 | $ | 0.23 |
Schedule_IParent_Company_only_
Schedule I-Parent Company only Balance Sheets | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Schedule I-Parent Company only Balance Sheets | Allison Transmission Holdings, Inc. | ||||||||||||
Schedule I—Parent Company only Balance Sheets | |||||||||||||
(dollars in millions) | |||||||||||||
December 31, | December 31, | ||||||||||||
2014 | 2013 | ||||||||||||
ASSETS | |||||||||||||
Current Assets: | |||||||||||||
Cash | $ | — | $ | — | |||||||||
Total Current Assets | — | — | |||||||||||
Investments in and advances to subsidiaries | 1,397.80 | 1,438.80 | |||||||||||
TOTAL ASSETS | $ | 1,397.80 | $ | 1,438.80 | |||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||
Current Liabilities: | |||||||||||||
Accounts payable | $ | — | $ | — | |||||||||
Total Current Liabilities | — | — | |||||||||||
Capital stock | 1.8 | 1.8 | |||||||||||
Additional paid-in-capital | 1,651.00 | 1,631.80 | |||||||||||
Treasury stock | — | — | |||||||||||
Accumulated deficit | (215.5 | ) | (173.8 | ) | |||||||||
Accumulated other comprehensive loss, net of tax | (39.5 | ) | (21.0 | ) | |||||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,397.80 | $ | 1,438.80 | |||||||||
The accompanying note is an integral part of the Parent Company only financial statements. | |||||||||||||
Allison Transmission Holdings, Inc. | |||||||||||||
Schedule I—Parent Company only Statements of Comprehensive Income | |||||||||||||
(dollars in millions) | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net sales | $ | — | $ | — | $ | — | |||||||
General and administrative fees | — | — | — | ||||||||||
Total operating income | — | — | — | ||||||||||
Other income: | |||||||||||||
Equity earnings of consolidated subsidiary | 228.6 | 165.4 | 514.2 | ||||||||||
Income before income taxes | 228.6 | 165.4 | 514.2 | ||||||||||
Income tax expense | — | — | — | ||||||||||
Net income | $ | 228.6 | $ | 165.4 | $ | 514.2 | |||||||
Comprehensive income | $ | 228.6 | $ | 165.4 | $ | 514.2 | |||||||
The accompanying note is an integral part of the Parent Company only financial statements. | |||||||||||||
Allison Transmission Holdings, Inc. | |||||||||||||
Schedule I—Parent Company only Statements of Cash Flows | |||||||||||||
(dollars in millions) | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||||
Net income | $ | 228.6 | $ | 165.4 | $ | 514.2 | |||||||
Deduct items included in net income not providing cash: | |||||||||||||
Equity in earnings in consolidated subsidiary | (228.6 | ) | (165.4 | ) | (514.2 | ) | |||||||
Net cash provided by operating activities | — | — | — | ||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||||
Investments in subsidiaries | (59.6 | ) | (46.3 | ) | (29.0 | ) | |||||||
Dividends | 91.6 | 77.1 | 32.8 | ||||||||||
Net cash provided by investing activities | 32 | 30.8 | 3.8 | ||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||||
Capital contributions | 59.6 | 46.3 | 29 | ||||||||||
Dividends | (91.6 | ) | (77.1 | ) | (32.8 | ) | |||||||
Net cash used in financing activities | (32.0 | ) | (30.8 | ) | (3.8 | ) | |||||||
Net increase (decrease) during period | — | — | — | ||||||||||
Cash and cash equivalents at beginning of period | — | — | — | ||||||||||
Cash and cash equivalents at end of period | $ | — | $ | — | $ | — | |||||||
The accompanying note is an integral part of the Parent Company only financial statements. | |||||||||||||
Allison Transmission Holdings, Inc. | |||||||||||||
Schedule I—Parent Company only Footnote | |||||||||||||
NOTE 1—BASIS OF PRESENTATION | |||||||||||||
Allison Transmission Holdings, Inc. (the “Parent Company”) is a holding company that conducts all of its business operations through its subsidiaries. There are restrictions on the Parent Company’s ability to obtain funds from its subsidiaries through dividends (refer to NOTE 7 of the Consolidated Financial Statements). The entire amount of our consolidated net assets was subject to restrictions on payment of dividends at the end of December 31, 2014, 2013 and 2012. Accordingly, these financial statements have been presented on a “parent-only” basis. Under a parent-only presentation, the Parent Company’s investments in its consolidated subsidiaries are presented under the equity method of accounting. These parent-only financial statements should be read in conjunction with Allison Transmission Holdings, Inc.’s audited Consolidated Financial Statements included elsewhere herein. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation | ||
The consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The information herein reflects all normal recurring material adjustments, which are, in the opinion of management, necessary for the fair statements of the results for the periods presented. The consolidated financial statements herein consist of all wholly-owned domestic and foreign subsidiaries with all significant intercompany transactions eliminated. | |||
These consolidated financial statements present the financial position, results of comprehensive income, cash flows and statements of equity. Certain immaterial reclassifications have been made in the consolidated financial statements of prior periods to conform to the current period presentation. These reclassifications have no impact on previously reported net income, total stockholders’ equity or cash flows. | |||
Use of Estimates | Use of Estimates | ||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenue and expenses. Significant estimates include, but are not limited to, allowance for doubtful accounts, sales allowances, government price adjustments, fair market values and future cash flows associated with goodwill, indefinite-life intangibles, long-lived asset impairment tests, useful lives for depreciation and amortization, warranty liability, determination of discount and other assumptions for pension and other postretirement benefit expense, income taxes and deferred tax valuation allowances, derivative valuation, and contingencies. The Company’s accounting policies involve the application of judgments and assumptions made by management that include inherent risks and uncertainties. Actual results could differ materially from these estimates. Changes in estimates are recorded in results of operations in the period that the events or circumstances giving rise to such changes occur. | |||
Segment Reporting | Segment Reporting | ||
In accordance with the Financial Accounting Standards Board (“FASB”) authoritative accounting guidance on segment reporting, the Company has one operating segment and reportable segment. The Company is in one line of business, which is the manufacture and distribution of fully-automatic transmissions. | |||
Government Grants | Government Grants | ||
The Company recognizes government grants when there is reasonable assurance that the Company will comply with the conditions attached to the grant arrangement and the funds will be received. When the government grants relate to reimbursement of costs, the grant income is recognized in Other expense, net in the Consolidated Statements of Comprehensive Income. When the government grants relate to a reimbursement of capital expenditures, the grants are recognized as a reduction of the basis of the assets in the Consolidated Balance Sheets. | |||
Cash and Cash Equivalents | Cash and Cash Equivalents | ||
Cash equivalents are defined as short-term, highly-liquid investments with original maturities of 90 days or less. Under the Company’s cash management system, checks issued but not presented to banks may result in book overdraft balances for accounting purposes and are classified within Accounts payable in the Consolidated Balance Sheets. The change in book overdrafts is reported as a component of operating cash flows for Accounts payable. | |||
Marketable Securities | Marketable Securities | ||
The Company determines the appropriate classification of all marketable securities as “held-to-maturity,” “available-for-sale” or “trading” at the time of purchase, and re-evaluates such classifications as of each balance sheet date. As of December 31, 2014, the Company’s marketable securities are classified as either available-for-sale or trading. | |||
Available-for-sale securities are carried at fair value with the unrealized gain or loss reported in Accumulated other comprehensive loss (“AOCL”). Unrealized gains or losses considered to be “other-than-temporary” are recognized in income. Trading securities are carried at fair value with the unrealized gain or loss recognized in Other expense, net. The fair value of the Company’s investment securities is determined by currently available market prices. See NOTE 6 for more details. | |||
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts | ||
The allowance for doubtful trade accounts receivable reflects estimated losses to be incurred in the collection of the receivables. Estimated losses are based on historical collection experience as well as a review by management of the current status of all receivables. Account balances are charged against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. | |||
Inventories | Inventories | ||
Inventories are stated at the lower of cost or market. The Company determines cost using the first-in, first-out method. The Company analyzes inventory on a quarterly basis to determine whether it is excess or obsolete inventory. Any decline in carrying value of estimated excess or obsolete inventory is recorded as a reduction of inventory and as an expense included in Cost of sales in the period it is identified. | |||
Property, Plant and Equipment | Property, Plant and Equipment | ||
Property, plant and equipment are recorded at cost less accumulated depreciation. Depreciation expense is recorded using the straight-line method over the following estimated lives: | |||
Range in Years | |||
Land improvements | 5 – 30 | ||
Buildings and building improvements | 10 – 40 | ||
Machinery and equipment | 2 – 20 | ||
Software | 2 – 5 | ||
Special tools | 2 – 10 | ||
Software represents the costs of software developed or obtained for internal use. Software costs are amortized on a straight-line basis over their estimated useful lives. Software assets are reviewed for impairment when events or circumstances indicate that the carrying value may not be recoverable over the remaining lives of the assets. Upgrades and enhancements are capitalized if they result in added functionality, which enables the software to perform tasks it was previously incapable of performing. Software maintenance, training, data conversion and business process reengineering costs are expensed in the period in which they are incurred. | |||
Special tooling represents the costs to design and develop tools, dies, jigs and other items owned by the Company and used in the manufacture of components by suppliers under long-term supply agreements. Special tooling is depreciated over the tool’s expected life. Special tooling used in the development of new technology is expensed as incurred. Engineering, testing and other costs incurred in the design and development of production parts are expensed as incurred. | |||
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets | ||
The carrying value of long-lived assets is evaluated whenever events or circumstances indicate that the carrying value of an asset may not be recoverable. Events or circumstances that would result in an impairment review primarily include a significant change in the use of an asset, or the planned sale or disposal of an asset. The asset would be considered impaired when there is no future use planned for the asset or the future net undiscounted cash flows generated by the asset or asset group are less than its carrying value. An impairment loss would be recognized based on the amount by which the carrying value exceeds fair value. | |||
Assumptions and estimates used to determine cash flows in the evaluation of impairment and the fair values used to determine the impairment are subject to a degree of judgment and complexity. Any changes to the assumptions and estimates resulting from changes in actual results or market conditions from those anticipated may affect the carrying value of long-lived assets and could result in an impairment charge. | |||
As a result of events and circumstances in the fourth quarter of 2014, the Company reviewed certain of its long-lived assets related to the production of the H3000 and H4000 hybrid-propulsion systems, resulting in a $15.4 million loss recorded for the year ended December 31, 2014. The loss, determined by using future net discounted cash flows, included approximately $1.7 million of accrued expenses related to the impairment of the long-lived assets. Deteriorating market conditions for hybrid-propulsion vehicles, principally as a result of decreased fuel costs, alternative fuels and other technologies, significantly contributed to the future cash flows of the related assets being less than the carrying value of those assets. | |||
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets | ||
Goodwill represents the excess of purchase price paid over the fair value of net assets acquired. In accordance with the FASB’s authoritative accounting guidance on goodwill, the Company does not amortize goodwill but rather evaluates it for impairment on an annual basis, or more often if events or circumstances change that could cause goodwill to become impaired. Goodwill is tested for impairment at the reporting unit level, which is the same as the Company’s one operating and reportable segment. The Company has elected to perform its annual impairment test on October 31 of every year. A multi-step impairment test is performed on goodwill. In Step 0, the Company has the option to evaluate various qualitative factors to determine the likelihood of impairment. If determined that the fair value is more likely than not less than the carrying value, then the Company is required to perform Step 1. If the Company does not elect to perform Step 0, it can voluntarily proceed directly to Step 1. In Step 1, the Company performs a quantitative analysis to compare the fair value of its reporting unit to its carrying value including goodwill. If the fair value of the reporting unit exceeds the carrying value of the net assets assigned to that unit, goodwill is not considered impaired, and the Company is not required to perform further testing. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then the Company must perform Step 2 of the impairment test in order to determine the implied fair value of the reporting unit’s goodwill. If the carrying value of a reporting unit’s goodwill exceeds its implied fair value, then the Company would record an impairment loss equal to the difference. | |||
Goodwill impairment testing for 2014 was performed by assessing certain qualitative trends and factors. The Company’s qualitative assessment included an assessment of business changes, economic outlook, financial trends and forecasts, growth rates, credit ratings, equity ratings, discount rates, industry data and other relevant qualitative factors. Events or circumstances that could unfavorably impact the key assumptions include lower net sales driven by market conditions, our inability to execute on marketing programs and/or delay in the introduction of new products, lower gross margins as a result of market conditions or failure to obtain forecasted cost reductions, or a higher discount rate as a result of market conditions. While unpredictable and inherently uncertain, the Company believes its forecast estimates are reasonable and incorporate assumptions that similar market participants would use in their estimates of fair value. These trends and factors were compared to, and based on, the assumptions used in the quantitative assessment performed in 2013. After reviewing various qualitative factors, the Company’s 2014 annual goodwill impairment test indicated that the fair value of the reporting unit more likely than not exceeded its carrying value, indicating no impairment. | |||
Other intangible assets have both indefinite and finite useful lives. Intangible assets with indefinite useful lives, such as the Company’s trade name, are not amortized but are tested annually for impairment. The Company has elected to perform our annual trade name impairment test on October 31 of every year and follow a similar multi-step impairment test that is performed on goodwill. After reviewing various qualitative factors, the Company’s 2014 annual trade name impairment test indicated that the fair value of the trade name more likely than not exceeded its carrying value, indicating no impairment. The qualitative review included an assessment of various key assumptions and factors including, among others, an assessment of business changes, economic outlooks, financial trends and forecasts, royalty savings rates, credit ratings, equity ratings and discount rates. Events or circumstances that could unfavorably impact the key assumptions include lower net sales driven by market conditions, our inability to execute on marketing programs and/or delay in introduction of new products, and higher discount rate as a result of market conditions. While unpredictable and inherently uncertain, we believe the forecast estimates are reasonable and incorporate those assumptions that similar market participants would use in their estimates of fair value. These trends and factors were compared to, and based on, the assumptions used in the quantitative assessment performed in 2013. After reviewing various qualitative factors, the fair value of trade name exceeded the respective carrying value. | |||
Intangible assets with finite lives are amortized over their estimated useful lives and reviewed for impairment when circumstances change that would create a triggering event. Customer relationships are amortized over the life in which expected benefits are to be consumed. The other remaining finite useful life intangibles are amortized on a straight-line basis over their useful lives. The Company evaluates the remaining useful life of the other intangible assets on a periodic basis to determine whether events or circumstances warrant a revision to the remaining useful life. Assumptions and estimates about future values and remaining useful lives of the Company’s intangible and other long-lived assets are complex and subjective. They can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors, such as changes in the Company’s business strategy and internal forecasts. Although management believes the historical assumptions and estimates are reasonable and appropriate, different assumptions and estimates could materially impact the Company’s reported financial results. | |||
NOTE 5 provides further information on Goodwill and Other intangible assets. | |||
Deferred Financing Costs | Deferred Financing Costs | ||
Deferred financing costs are stated at cost as a component of other non-current assets and amortized over the life of the related debt using the effective interest method. Amortization of deferred financing costs is recorded as part of interest expense and totaled $8.1 million, $10.9 million and $14.5 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||
Financial Instruments | Financial Instruments | ||
The Company’s cash equivalents are invested in U.S. Government backed securities and recorded at fair value in the Consolidated Balance Sheets. The carrying values of accounts receivable and accounts payable approximate fair value due to their short-term nature. The Company’s financial derivative instruments, including interest rate swaps and foreign currency and commodity forward contracts are carried at fair value on the Consolidated Balance Sheets. Refer to NOTE 6 for more detail. The Company’s long-term debt obligations are carried at historical amounts with the Company providing fair value disclosure in NOTE 7. | |||
Insurable Liabilities | Insurable Liabilities | ||
The Company records liabilities for its medical, workers’ compensation, long-term disability, product, general and auto liabilities. The determination of these liabilities and related expenses is dependent on claims experience. For most of these liabilities, claims incurred but not yet reported are estimated based upon historical claims experience. | |||
Revenue Recognition | Revenue Recognition | ||
The Company records sales when title has transferred to the customer, there is evidence of an agreement, the sales price is fixed or determinable, delivery has occurred or services have been rendered, and collectability is reasonably assured. The Company sells Extended Transmission Coverage (“ETC”) for which sales are deferred. ETC sales are recognized ratably over the period of the ETC, which typically ranges from two to five years after initial sale. Costs associated with ETC programs are recorded as incurred during the extended period. Distributor and customer sales incentives, consisting of allowances and other rebates, are estimated at the time of sale based upon the Company’s history and experience and are recorded as a reduction to Net sales. Incentive programs are generally product specific or region specific. Some factors used in estimating the cost of incentives include the number of transmissions that will be affected by the incentive program and rate of acceptance of any incentive program. If the actual number of affected transmissions differs from this estimate, or if a different mix of incentives is actually paid, the impact on Net sales would be recorded in the period that the change was identified. Consideration given to commercial customers recorded as a reduction of Net sales in the Consolidated Statements of Comprehensive Income included $66.9 million, $65.2 million, and $59.9 million for the years ended December 31, 2014, 2013 and 2012, respectively. | |||
Sales under U.S. government production contracts are recorded when the product is accepted, title has transferred to the U.S. government, the sales price is fixed or determinable, and delivery has occurred. Deferred revenue arises from cash received in advance of the culmination of the earnings process and is recognized as revenue in future periods when the applicable revenue recognition criteria have been met. Under the terms of the U.S. government contracts, there are certain price reduction clauses and provisions for potential price reductions which are estimated at the time of sale based upon the Company’s history and experience and are recorded as a reduction to Net sales. Potential reductions may be attributed to a change in projected sales volumes or plant efficiencies which impact overall costs. As of December 31, 2014 and 2013, the Company had $63.1 million and $49.6 million recorded in the price reduction reserve account, respectively. | |||
Due to requests from the U.S. government, the Company billed, but did not ship certain tracked transmissions during 2013. Based on the lack of a fixed delivery date from the U.S. government, the Company deferred approximately $8.8 million of net sales for these transmissions until they were shipped in 2014. See NOTE 10 for additional details. | |||
The Company classifies shipping and handling billed to customers in Net sales and shipping and handling costs in Cost of sales, in accordance with authoritative accounting guidance. | |||
The Company contracts with various third parties to provide engineering services. These services are recorded as Net sales in accordance with the terms of the contract. The saleable engineering recorded was $7.4 million, 12.4 million and $7.8 million for the years ended December 31, 2014, 2013 and 2012, respectively. The associated costs are recorded in Cost of sales. | |||
Warranty | Warranty | ||
Provisions for estimated expenses related to product warranties are made at the time products are sold. Warranty claims arise when a transmission fails while in service during the relevant warranty period. The warranty reserve is adjusted in Selling, general and administrative expenses based on the Company’s current and historical warranty claims paid and associated repair costs. These estimates are established using historical information including the nature, frequency, and average cost of warranty claims and are adjusted as actual information becomes available. From time to time, the Company may initiate a specific field action program. As a result of the uncertainty surrounding the nature and frequency of specific field action programs, the liability for such programs is recorded when the Company commits to an action. The Company reviews and assesses the liability for these programs on a quarterly basis. The Company also assesses its ability to recover certain costs from its suppliers and records a receivable from the supplier when it believes a recovery is probable. | |||
Research and Development | Research and Development | ||
The Company incurs costs in connection with research and development programs that are expected to contribute to future earnings. Such costs are charged to Engineering — research and development as incurred. | |||
Foreign Currency Translation | Foreign Currency Translation | ||
Most of the subsidiaries outside the United States prepare financial statements in currencies other than the U.S. dollar. The functional currency for all these subsidiaries is the local currency, except for the Company’s Hong Kong and Middle East subsidiaries which currently use the U.S. dollar as their functional currency. Balances are translated at period-end exchange rates for assets and liabilities and monthly weighted-average exchange rates for revenues and expenses. The translation gains (losses) are stated as a component of AOCL as disclosed in NOTE 16. | |||
Derivative Instruments | Derivative Instruments | ||
In the normal course of business, the Company is exposed to fluctuations in interest rates, foreign currency exchange rates, and commodity prices. The risk is managed through the use of financial derivative instruments including interest rate swaps and commodity and foreign currency forward contracts. Despite the fact that the Company either has not elected or does not qualify for hedge accounting treatment on all of its derivative instruments, the contracts are used strictly as an economic hedge and not for speculative purposes. As necessary, the Company adjusts the values of the derivative instruments for counter-party or credit risk. NOTE 8 provides further information on the accounting treatment of the Company’s derivative instruments. | |||
Income Taxes | Income Taxes | ||
Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. The future tax benefits associated with operating loss and tax credit carryforwards are recognized as deferred tax assets. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. | |||
The need to establish a valuation allowance against the deferred tax assets is assessed periodically based on a more-likely-than-not realization threshold, in accordance with the FASB’s authoritative accounting guidance on income taxes. Appropriate consideration is given to all positive and negative evidence related to that realization. This assessment considers, among other matters, the nature, frequency and severity of recent losses, forecasts of future profitability, the duration of statutory carryforward periods, and experience with tax attributes expiring unused and tax planning alternatives. The weight given to these considerations depends upon the degree to which they can be objectively verified. | |||
Stock-Based Compensation | Stock-Based Compensation | ||
The Company maintains a stock-based compensation plan which allows employees (including executive officers), consultants and directors to receive equity awards. The Company has adopted the FASB’s authoritative accounting guidance on share-based payments and recognizes the fair value of the awards as compensation expense over the vesting period. The accounting guidance also requires that forfeitures be estimated over the vesting period of an award instead of being recognized as a reduction of compensation expense when the forfeiture actually occurs. | |||
Pension and Post-retirement Benefit Plans | Pension and Post-retirement Benefit Plans | ||
For pension and other post-retirement benefits (“OPEB”) plans in which employees participate, costs are determined within the FASB’s authoritative accounting guidance set forth in employers’ defined benefit pensions including accounting for settlements and curtailments of defined benefit pension plans, termination of benefits and accounting for post-retirement benefits other than pensions. In accordance with the authoritative accounting guidance, the Company recognizes the funded status of its defined benefit pension plans and OPEB plan in its Consolidated Balance Sheets with a corresponding adjustment to AOCL, net of tax. | |||
Post-retirement benefit costs consist of service cost, interest cost on accrued obligations and the expected return on assets (calculated using a smoothed market value of assets). Any difference between actual and expected returns on assets during a year and actuarial gains and losses on liabilities together with any prior service costs are charged (or credited) to income over the average remaining service lives of employees. | |||
The benefit cost components shown in the Consolidated Statements of Comprehensive Income are based upon various actuarial assumptions and methodologies as prescribed by authoritative accounting guidance. These assumptions include discount rates, expected return on plan assets, health care cost trend rates, inflation, rate of compensation increases, population demographics, mortality rates and other factors. The Company reviews all actuarial assumptions on an annual basis. Changes in key economic indicators can change these assumptions. These assumptions, along with the actual value of assets at the measurement date, will impact the calculation of pension expenses for the year. For instance, the effect of a one percentage point decrease in the assumed discount rate would result in an increase in the December 31, 2014 defined benefit pension plans obligation of approximately $20.0 million. Similarly, a one percentage point decrease in the assumed discount rate would result in an increase in the December 31, 2014 OPEB obligation of approximately $23.7 million. | |||
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements | ||
In August 2014, the FASB issued authoritative accounting guidance on the disclosure of uncertainties about an entity’s ability to continue as a going concern. The guidance requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that financial statements are available to be issued when applicable) and to provide related footnote disclosures. The guidance is effective prospectively for fiscal years beginning after December 15, 2016, but can be early-adopted. While the adoption of this guidance is not expected to have an effect on the Company’s consolidated financial statements, it could affect the disclosure applied under these circumstances in the future. | |||
In May 2014, the FASB issued authoritative accounting guidance on a company’s accounting for revenue from contracts with customers. The guidance applies to all companies that enter into contracts with customers to transfer goods, service or nonfinancial assets. The guidance requires these companies to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance also requires improved disclosures regarding the nature, timing, amount and uncertainty of revenue that is recognized. The guidance is effective prospectively for fiscal years beginning after December 15, 2016. Management is currently assessing the potential impact of the adoption of this guidance on the Company’s consolidated financial statements. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||
Dec. 31, 2014 | |||
Property And Equipment Estimated Useful Lives | Depreciation expense is recorded using the straight-line method over the following estimated lives: | ||
Range in Years | |||
Land improvements | 5 – 30 | ||
Buildings and building improvements | 10 – 40 | ||
Machinery and equipment | 2 – 20 | ||
Software | 2 – 5 | ||
Special tools | 2 – 10 |
INVENTORIES_Tables
INVENTORIES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Components of Inventories | Inventories consisted of the following components (dollars in millions): | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Purchased parts and raw materials | $ | 72.3 | $ | 79.7 | |||||
Work in progress | 6.1 | 5.7 | |||||||
Service parts | 46.5 | 45.8 | |||||||
Finished goods | 18.6 | 29.2 | |||||||
Total inventories | $ | 143.5 | $ | 160.4 | |||||
PROPERTY_PLANT_AND_EQUIPMENT_T
PROPERTY, PLANT AND EQUIPMENT (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Property Plant and Equipment Cost and Accumulated Depreciation | The cost and accumulated depreciation of property, plant and equipment are as follows (dollars in millions): | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Land and land improvements | $ | 23.6 | $ | 20.3 | |||||
Buildings and building improvements | 281.6 | 271.4 | |||||||
Machinery and equipment | 576.2 | 567.7 | |||||||
Software | 117 | 112.9 | |||||||
Special tools | 143.6 | 143.4 | |||||||
Construction in progress | 39.9 | 48.6 | |||||||
Total property, plant and equipment | 1.181.9 | 1,164.30 | |||||||
Accumulated depreciation | (667.3 | ) | (600.9 | ) | |||||
Property, plant and equipment, net | $ | 514.6 | $ | 563.4 | |||||
GOODWILL_AND_OTHER_INTANGIBLE_1
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Summary of Other Intangible Assets | The following presents a summary of other intangible assets (dollars in millions): | ||||||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||||||
Intangible | Accumulated | Intangible | Intangible | Accumulated | Intangible | ||||||||||||||||||||
assets, gross | amortization | assets, net | assets, gross | amortization | assets, net | ||||||||||||||||||||
Other intangible assets: | |||||||||||||||||||||||||
Trade name | $ | 870 | $ | — | $ | 870 | $ | 870 | $ | — | $ | 870 | |||||||||||||
Customer relationships - defense | 62.3 | (27.9 | ) | 34.4 | 62.3 | (24.4 | ) | 37.9 | |||||||||||||||||
Customer relationships - commercial | 831.8 | (426.9 | ) | 404.9 | 831.8 | (374.9 | ) | 456.9 | |||||||||||||||||
Proprietary technology | 476.3 | (282.0 | ) | 194.3 | 476.3 | (243.9 | ) | 232.4 | |||||||||||||||||
Non-compete agreement | 17.3 | (12.8 | ) | 4.5 | 17.3 | (11.1 | ) | 6.2 | |||||||||||||||||
Patented technology - defense | 28.2 | (24.5 | ) | 3.7 | 28.2 | (21.2 | ) | 7 | |||||||||||||||||
Tooling rights | 4.5 | (4.3 | ) | 0.2 | 4.5 | (4.1 | ) | 0.4 | |||||||||||||||||
Patented technology - commercial | 260.6 | (260.6 | ) | — | 260.6 | (260.6 | ) | — | |||||||||||||||||
Total | $ | 2,551.00 | $ | (1,039.0 | ) | $ | 1,512.00 | $ | 2,551.00 | $ | (940.2 | ) | $ | 1,610.80 | |||||||||||
Amortization Expense Related to Other Intangible Assets for Next Five Years and Thereafter | Amortization expense related to other intangible assets for the next five years and thereafter is expected to be (dollars in millions): | ||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | ||||||||||||||||||||
Amortization expense | $ | 97.1 | $ | 92.4 | $ | 89.7 | $ | 87.2 | $ | 85.7 | $ | 189.9 | |||||||||||||
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Summary of Fair Value of Financial Assets and (Liabilities) | The following table summarizes the fair value of the Company’s financial assets and (liabilities) as of December 31 (dollars in millions): | ||||||||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||||
Quoted Prices in Active | Significant Other | TOTAL | |||||||||||||||||||||||
Markets for Identical | Observable Inputs (Level 2) | ||||||||||||||||||||||||
Assets (Level 1) | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||
Cash equivalents | $ | 55 | $ | 5 | $ | — | $ | — | $ | 55 | $ | 5 | |||||||||||||
Available-for-sale securities | 8.6 | 8.2 | — | — | 8.6 | 8.2 | |||||||||||||||||||
Rabbi trust assets | 2.9 | 1.3 | — | — | 2.9 | 1.3 | |||||||||||||||||||
Deferred compensation obligation | (2.9 | ) | (1.3 | ) | — | — | (2.9 | ) | (1.3 | ) | |||||||||||||||
Derivative assets | — | — | 0 | 1.6 | 0 | 1.6 | |||||||||||||||||||
Derivative liabilities | — | — | (15.4 | ) | (21.4 | ) | (15.4 | ) | (21.4 | ) | |||||||||||||||
Total | $ | 63.6 | $ | 13.2 | $ | (15.4 | ) | $ | (19.8 | ) | $ | 48.2 | $ | (6.6 | ) | ||||||||||
DEBT_Tables
DEBT (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Summary of Long-Term Debt and Maturities | Long-term debt and maturities are as follows (dollars in millions): | ||||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||
Long-term debt: | |||||||||||||||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | $ | 283.6 | $ | 423.5 | |||||||||||||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | 1,765.60 | 1,783.50 | |||||||||||||||||||
Senior Notes, fixed 7.125%, due 2019 | 471.3 | 471.3 | |||||||||||||||||||
Total long-term debt | $ | 2,520.50 | $ | 2,678.30 | |||||||||||||||||
Less: current maturities of long-term debt | 17.9 | 17.9 | |||||||||||||||||||
Total long-term debt less current portion | $ | 2,502.60 | $ | 2,660.40 | |||||||||||||||||
Principal Payments Required on Long Term Debt | Principal payments required on long-term debt during the next five years are as follows: | ||||||||||||||||||||
Required Principal Payments | |||||||||||||||||||||
(dollars in millions) | 2015 | 2016 | 2017 | 2018 | 2019 | ||||||||||||||||
Payment | $ | 17.9 | $ | 17.9 | $ | 301.4 | $ | 17.9 | $ | 2,165.40 |
DERIVATIVES_Tables
DERIVATIVES (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Summary of Company's Interest Rate Derivatives | A summary of the Company’s interest rate derivatives as of December 31, 2014 and December 31, 2013 follows (dollars in millions): | ||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||
Notional | Fair Value | Notional | Fair Value | ||||||||||||||||||
Amount | Amount | ||||||||||||||||||||
3.75% Interest Rate Swap H, Aug 2011 – Aug 2014 | $ | — | $ | — | $ | 350 | $ | (7.2 | ) | ||||||||||||
3.77% Interest Rate Swap I, Aug 2011 – Aug 2014 | — | — | 350 | (7.2 | ) | ||||||||||||||||
2.96% Interest Rate Swap J, Aug 2013 – Aug 2014 | — | — | 125 | (2.0 | ) | ||||||||||||||||
3.05% Interest Rate Swap K, Aug 2013 – Aug 2014 | — | — | 125 | (2.0 | ) | ||||||||||||||||
3.44% Interest Rate Swap L, Aug 2016 – Aug 2019* | 75 | (2.3 | ) | 75 | (0.4 | ) | |||||||||||||||
3.43% Interest Rate Swap M, Aug 2016 – Aug 2019* | 100 | (3.0 | ) | 100 | (0.4 | ) | |||||||||||||||
3.37% Interest Rate Swap N, Aug 2016 – Aug 2019* | 75 | (2.1 | ) | 75 | (0.2 | ) | |||||||||||||||
3.19% Interest Rate Swap O, Aug 2016 – Aug 2019* | 75 | (1.7 | ) | 75 | 0.2 | ||||||||||||||||
3.08% Interest Rate Swap P, Aug 2016 – Aug 2019* | 75 | (1.5 | ) | 75 | 0.4 | ||||||||||||||||
2.99% Interest Rate Swap Q, Aug 2016 – Aug 2019* | 50 | (0.9 | ) | 50 | 0.4 | ||||||||||||||||
2.98% Interest Rate Swap R, Aug 2016 – Aug 2019* | 50 | (0.9 | ) | 50 | 0.4 | ||||||||||||||||
2.73% Interest Rate Swap S, Aug 2016 – Aug 2019* | 50 | (0.5 | ) | — | — | ||||||||||||||||
2.74% Interest Rate Swap T, Aug 2016 – Aug 2019* | 75 | (0.8 | ) | — | — | ||||||||||||||||
2.66% Interest Rate Swap U, Aug 2016 – Aug 2019* | 50 | (0.4 | ) | — | — | ||||||||||||||||
2.60% Interest Rate Swap V, Aug 2016 – Aug 2019* | 50 | (0.3 | ) | — | — | ||||||||||||||||
2.40% Interest Rate Swap W, Aug 2016 – Aug 2019* | 25 | 0 | — | — | |||||||||||||||||
* includes LIBOR floor of 1.00% | $ | 750 | $ | (14.4 | ) | $ | 1,450.00 | $ | (18.0 | ) | |||||||||||
Derivative Instruments and their Impact on the Financial Condition | The following tabular disclosures further describe the Company’s derivative instruments and their impact on the financial condition of the Company (dollars in millions): | ||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||
Balance Sheet Location | Fair Value | Balance Sheet Location | Fair Value | ||||||||||||||||||
Derivatives not designated as hedging instruments | |||||||||||||||||||||
Foreign currency contracts | Other current | $ | (0.3 | ) | Other current | $ | (0.3 | ) | |||||||||||||
liabilities | liabilities | ||||||||||||||||||||
Commodity contracts | Other current and | 0.1 | |||||||||||||||||||
non-current assets | |||||||||||||||||||||
Other current and | (0.7 | ) | Other current and | (1.7 | ) | ||||||||||||||||
non-current liabilities | non-current liabilities | ||||||||||||||||||||
Interest rate contracts | Other non- | 1.5 | |||||||||||||||||||
current assets | |||||||||||||||||||||
Other non- | (14.4 | ) | Other current and | (19.5 | ) | ||||||||||||||||
current liabilities | non-current liabilities | ||||||||||||||||||||
Total derivatives not designated as hedging instruments | $ | (15.4 | ) | $ | (19.9 | ) | |||||||||||||||
Interest Rate Derivative Instruments and their Impact on the Results of Operations | The impact on the Company’s Consolidated Statements of Comprehensive Income related to foreign currency and commodity contracts can be found in NOTE 11, and the following tabular disclosure describes the location and impact on the Company’s results of operations related to unrealized gain (loss) on interest rate derivatives (dollars in millions): | ||||||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||
Location of impact on results of operations | |||||||||||||||||||||
Interest expense | $ | 3.5 | $ | 34.3 | $ | 25.5 | |||||||||||||||
Foreign Currency Forward Contract | |||||||||||||||||||||
Notional Amount and Fair Value of Derivatives | The following table summarizes the outstanding foreign currency forward contracts as of December 31, 2014 and 2013 (amounts in millions): | ||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||
Notional | Fair Value | Notional | Fair Value | ||||||||||||||||||
Amount | Amount | ||||||||||||||||||||
Japanese Yen (JPY) | ¥ | 300 | $ | (0.3 | ) | ¥ | 600 | $ | (0.3 | ) | |||||||||||
$ | (0.3 | ) | $ | (0.3 | ) | ||||||||||||||||
Commodity contracts | |||||||||||||||||||||
Notional Amount and Fair Value of Derivatives | The following table summarizes the outstanding commodity swaps as of December 31, 2014 and December 31, 2013 (dollars in millions): | ||||||||||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||||||||||
Notional | Quantity | Fair Value | Notional | Quantity | Fair Value | ||||||||||||||||
Amount | Amount | ||||||||||||||||||||
Aluminum | $ | 11.3 | 6,200 metric tons | $ | (0.7 | ) | $ | 23.8 | 11,875 metric tons | $ | (1.6 | ) | |||||||||
Natural Gas | $ | 0.2 | 60,000 MMBtu | 0 | $ | 0.3 | 90,000 MMBtu | 0 | |||||||||||||
$ | (0.7 | ) | $ | (1.6 | ) | ||||||||||||||||
PRODUCT_WARRANTY_LIABILITIES_T
PRODUCT WARRANTY LIABILITIES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Product Warranty Liability Activities | Product warranty liability activities consist of the following (dollars in millions): | ||||||||||||
Year ended | Year ended | Year ended | |||||||||||
December 31, | December 31, | December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||||
Beginning balance | $ | 90.5 | $ | 109.7 | $ | 115.4 | |||||||
Payments | (35.0 | ) | (38.7 | ) | (47.3 | ) | |||||||
Increase in liability (warranty issued during period) | 26.8 | 28.4 | 25.5 | ||||||||||
Net adjustments to liability | 0.7 | (9.6 | ) | 15.3 | |||||||||
Accretion (for Predecessor liabilities) | 0.6 | 0.7 | 0.8 | ||||||||||
Ending balance | $ | 83.6 | $ | 90.5 | $ | 109.7 | |||||||
DEFERRED_REVENUE_Tables
DEFERRED REVENUE (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Deferred Revenue for Extended Transmission Coverage Activity | Deferred revenue for ETC activity (dollars in millions): | ||||||||||||
Year ended | Year ended | Year ended | |||||||||||
December 31, | December 31, | December 31, | |||||||||||
2014 | 2013 | 2012 | |||||||||||
Beginning balance | $ | 63.6 | $ | 63.5 | $ | 60.5 | |||||||
Increases | 26.2 | 21.1 | 22.9 | ||||||||||
Revenue earned | (20.8 | ) | (21.0 | ) | (19.9 | ) | |||||||
Ending balance | $ | 69 | $ | 63.6 | $ | 63.5 | |||||||
OTHER_EXPENSE_NET_Tables
OTHER EXPENSE, NET (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Computation of Other Expense, Net | Other expense, net consists of the following (dollars in millions): | ||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Loss on intercompany foreign exchange | $ | (5.4 | ) | $ | (2.3 | ) | $ | — | |||||
Grant program income | 2.6 | 5.2 | 11.5 | ||||||||||
Impairment loss on investments in technology-related initiatives | (2.0 | ) | (5.0 | ) | (14.4 | ) | |||||||
Gain on negotiation of commercial agreement | 2 | — | — | ||||||||||
Public offering fees and expenses | (1.4 | ) | (1.6 | ) | (6.1 | ) | |||||||
Unrealized gain (loss) on derivative contracts (see NOTE 8) | 1.2 | (1.5 | ) | 0.9 | |||||||||
Realized loss on derivative contracts (see NOTE 8) | (1.0 | ) | (2.8 | ) | (1.3 | ) | |||||||
Loss on foreign exchange | (1.0 | ) | (2.4 | ) | (2.6 | ) | |||||||
Loss on repayments and repurchases of long-term debt (see NOTE 7) | (0.5 | ) | (0.8 | ) | (22.1 | ) | |||||||
Termination of services agreement | — | — | (16.0 | ) | |||||||||
Loss on re-measurement of employee benefit plans (see NOTE 13) | — | — | (2.3 | ) | |||||||||
Other | (0.1 | ) | 0.3 | (0.4 | ) | ||||||||
Total | $ | (5.6 | ) | $ | (10.9 | ) | $ | (52.8 | ) | ||||
OTHER_CURRENT_LIABILITIES_Tabl
OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Summary of Other Current Liabilities | Other current liabilities consist of the following (dollars in millions): | ||||||||
As of | As of | ||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Payroll and related costs | $ | 50.9 | $ | 32.7 | |||||
Sales allowances | 25.5 | 26.9 | |||||||
Defense price reduction reserve | 16.2 | 26.8 | |||||||
Vendor buyback obligation | 13.2 | 11.8 | |||||||
Taxes payable | 8.5 | 8.6 | |||||||
Accrued interest payable | 5.2 | 11.2 | |||||||
Derivative liabilities | 0.8 | 20.2 | |||||||
Other accruals | 11.4 | 14.1 | |||||||
Total | $ | 131.7 | $ | 152.3 | |||||
EMPLOYEE_BENEFIT_PLANS_Tables
EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Net Periodic Benefit Costs | Information about the net periodic benefit cost and other changes recognized in AOCL for the pension and post-retirement benefit plans is as follows (dollars in millions): | ||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | Year ended | Year ended | Year ended | ||||||||||||||||||||
December 31, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||
Net Periodic Benefit Cost: | |||||||||||||||||||||||||
Service cost | $ | 13.2 | $ | 16.3 | $ | 15.2 | $ | 2.2 | $ | 3.3 | $ | 3.9 | |||||||||||||
Interest cost | 5 | 4 | 4.1 | 5.9 | 5.8 | 7.2 | |||||||||||||||||||
Expected return on assets | (7.7 | ) | (6.7 | ) | (5.9 | ) | — | — | — | ||||||||||||||||
Prior service cost | 0.1 | 0.1 | 0.1 | (3.6 | ) | (3.6 | ) | — | |||||||||||||||||
Loss (gain) | — | 0.7 | 1.2 | (0.7 | ) | — | — | ||||||||||||||||||
Settlement loss | — | — | 2.3 | — | — | — | |||||||||||||||||||
Net Periodic Benefit Cost | $ | 10.6 | $ | 14.4 | $ | 17 | $ | 3.8 | $ | 5.5 | $ | 11.1 | |||||||||||||
Other changes recognized in other comprehensive income: | |||||||||||||||||||||||||
Prior service credit | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (28.9 | ) | ||||||||||||
Net loss (gain) | 2.1 | (18.4 | ) | (2.1 | ) | 7.8 | (30.7 | ) | 3.8 | ||||||||||||||||
Amortizations | (0.1 | ) | (0.8 | ) | (3.6 | ) | 4.3 | 3.6 | — | ||||||||||||||||
Total recognized – other comprehensive income | $ | 2 | $ | (19.2 | ) | $ | (5.7 | ) | $ | 12.1 | $ | (27.1 | ) | $ | (25.1 | ) | |||||||||
Health Care Costs Trends | As health care costs trends have a significant effect on the amounts reported, an increase and decrease of one-percentage-point would have the following effects in the year ended December 31, 2014 (dollars in millions): | ||||||||||||||||||||||||
1% Increase | 1% Decrease | ||||||||||||||||||||||||
Effect on total of service and interest cost | $ | 1.7 | $ | (1.3 | ) | ||||||||||||||||||||
Effect on post-retirement benefit obligation | $ | 28.6 | $ | (22.3 | ) | ||||||||||||||||||||
Reconciliation of Changes in Net Benefit Obligations and Fair Value of Plan Assets | The following table provides a reconciliation of the changes in the net benefit obligations and fair value of plan assets for the years ended December 31, 2014, 2013 and 2012 (dollars in millions): | ||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | Year ended | Year ended | Year ended | ||||||||||||||||||||
December 31, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||
Benefit Obligations: | |||||||||||||||||||||||||
Net benefit obligation at beginning of year | $ | 105.9 | $ | 103.3 | $ | 99.7 | $ | 120.7 | $ | 142.6 | $ | 156.6 | |||||||||||||
Service cost | 13.2 | 16.3 | 15.2 | 2.2 | 3.3 | 3.9 | |||||||||||||||||||
Interest cost | 5 | 4 | 4.1 | 5.9 | 5.8 | 7.2 | |||||||||||||||||||
Plan Amendments | — | — | — | — | — | (28.9 | ) | ||||||||||||||||||
Settlements | — | — | (18.8 | ) | — | — | — | ||||||||||||||||||
Benefits paid | (1.5 | ) | (0.8 | ) | (0.4 | ) | (0.6 | ) | (0.3 | ) | — | ||||||||||||||
Actuarial loss (gain) | 10.9 | (16.9 | ) | 3.5 | 7.8 | (30.7 | ) | 3.8 | |||||||||||||||||
Net benefit obligation at end of year | $ | 133.5 | $ | 105.9 | $ | 103.3 | $ | 136 | $ | 120.7 | $ | 142.6 | |||||||||||||
Fair Value of Plan Assets: | |||||||||||||||||||||||||
Fair value of plan assets at beginning of year | $ | 108.6 | $ | 89.4 | $ | 83.4 | $ | — | $ | — | $ | — | |||||||||||||
Actual return on plan assets | 16.4 | 8.2 | 11.5 | — | — | — | |||||||||||||||||||
Employer contributions | 11.8 | 11.8 | 13.7 | 0.6 | 0.3 | — | |||||||||||||||||||
Settlements | — | — | (18.8 | ) | — | — | — | ||||||||||||||||||
Benefits paid | (1.5 | ) | (0.8 | ) | (0.4 | ) | (0.6 | ) | (0.3 | ) | — | ||||||||||||||
Fair value of plan assets at end of year | $ | 135.3 | $ | 108.6 | $ | 89.4 | $ | — | $ | — | $ | — | |||||||||||||
Net Funded Status | $ | 1.8 | $ | 2.7 | $ | (13.9 | ) | $ | (136.0 | ) | $ | (120.7 | ) | $ | (142.6 | ) | |||||||||
Fair Value of Plan Assets | The fair values of plan assets for the Company’s pension plans as of December 31, 2014 and 2013 are as follows (dollars in millions): | ||||||||||||||||||||||||
Quoted Prices in Active Markets | |||||||||||||||||||||||||
for Identical Assets (Level 1) | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Asset Category | Fair Value | % | Fair Value | % | |||||||||||||||||||||
Cash and cash equivalents | $ | 8.6 | 6 | % | $ | 3.6 | 3 | % | |||||||||||||||||
Diversified equity securities | 57.8 | 43 | 51.5 | 48 | |||||||||||||||||||||
Diversified debt securities | 68.9 | 51 | 53.5 | 49 | |||||||||||||||||||||
Total | $ | 135.3 | 100 | % | $ | 108.6 | 100 | % | |||||||||||||||||
Schedule of Allocation of Plan Assets | To achieve these objectives the Company has established the following targets: | ||||||||||||||||||||||||
Target | |||||||||||||||||||||||||
Asset Category | Hourly | Salary | |||||||||||||||||||||||
Cash and cash equivalents | 5 | % | 8 | % | |||||||||||||||||||||
Diversified equity securities | 39 | 46 | |||||||||||||||||||||||
Diversified debt securities | 56 | 46 | |||||||||||||||||||||||
Total | 100 | % | 100 | % | |||||||||||||||||||||
Amounts Recognized in Balance Sheet and in Accumulated Other Comprehensive Income AOCI | The following table discloses the amounts recognized in the balance sheet and in AOCL at December 31, 2014 and 2013, on a pre-tax basis (dollars in millions): | ||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Amounts Recognized in Balance Sheet: | |||||||||||||||||||||||||
Noncurrent assets | $ | 7.9 | $ | 7.4 | $ | — | $ | — | |||||||||||||||||
Current liabilities | — | — | (1.2 | ) | (1.4 | ) | |||||||||||||||||||
Noncurrent liabilities | (6.1 | ) | (4.7 | ) | (134.8 | ) | (119.3 | ) | |||||||||||||||||
Total asset (liability) | $ | 1.8 | $ | 2.7 | $ | (136.0 | ) | $ | (120.7 | ) | |||||||||||||||
Accumulated Other Comprehensive Loss: | |||||||||||||||||||||||||
Prior service (cost) credit | $ | (0.1 | ) | $ | (0.2 | ) | $ | 21.7 | $ | 25.4 | |||||||||||||||
Actuarial gain | 0.6 | 2.7 | 8.6 | 17.1 | |||||||||||||||||||||
Total | $ | 0.5 | $ | 2.5 | $ | 30.3 | $ | 42.5 | |||||||||||||||||
Amounts in Accumulated Other Comprehensive Income AOCI Expected to be Amortized and Recognized as Component of Net Periodic Benefit Cost in Two Thousand Thirteen | The amounts in AOCL expected to be amortized and recognized as a component of net periodic benefit cost in 2015 are as follows (dollars in millions): | ||||||||||||||||||||||||
2015 | |||||||||||||||||||||||||
Pension | Post-retirement | ||||||||||||||||||||||||
Plans | Benefits | ||||||||||||||||||||||||
Prior service (cost) credit | $ | (1.0 | ) | $ | 3.6 | ||||||||||||||||||||
Actuarial loss | 1 | — | |||||||||||||||||||||||
Total | $ | 0 | $ | 3.6 | |||||||||||||||||||||
Projected and Accumulated Benefit Obligation and Fair Value of Plan Assets for Pension Plans with Projected Benefit Obligation in Excess of Plan Assets | As of December 31, 2014 and 2013, the projected benefit obligation, the accumulated benefit obligation, and the fair value of plan assets for pension plans with a projected benefit obligation in excess of plan assets and for pension plans with an accumulated benefit obligation in excess of plan assets were as follows (dollars in millions): | ||||||||||||||||||||||||
Hourly Plan | Salary Plan | ||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Plans with projected benefit obligation in excess of plan assets: | |||||||||||||||||||||||||
Projected benefit obligation | N/A | 1 | N/A | 1 | $ | 71.4 | $ | 53.8 | |||||||||||||||||
Fair value of plan assets | N/A | 1 | N/A | 1 | $ | 65.3 | $ | 49.1 | |||||||||||||||||
Plans with accumulated benefit obligation in excess of plan assets: | |||||||||||||||||||||||||
Accumulated benefit obligation | N/A | 1 | N/A | 1 | $ | 67.6 | $ | 50.9 | |||||||||||||||||
Fair value of plan assets | N/A | 1 | N/A | 1 | $ | 65.3 | $ | 49.1 | |||||||||||||||||
1 | As of December 31, 2014 and 2013, the hourly defined benefit pension plan had plan assets greater than both the projected benefit obligation and accumulated benefit obligation. | ||||||||||||||||||||||||
Expected Cash Flows for Pension and Post-Retirement Benefit Plans | Information about expected cash flows for the Company’s pension and post-retirement benefit plans is as follows (dollars in millions): | ||||||||||||||||||||||||
Pension | Post-retirement | ||||||||||||||||||||||||
Plans | Benefits | ||||||||||||||||||||||||
Employer Contributions: | |||||||||||||||||||||||||
2015 expected contributions | $ | 2 | $ | 1.2 | |||||||||||||||||||||
Expected Benefit Payments: | |||||||||||||||||||||||||
2015 | 2.3 | 1.2 | |||||||||||||||||||||||
2016 | 3 | 1.7 | |||||||||||||||||||||||
2017 | 3.8 | 2.4 | |||||||||||||||||||||||
2018 | 4.6 | 3.2 | |||||||||||||||||||||||
2019 | 5.5 | 3.9 | |||||||||||||||||||||||
2020-2024 | 40.6 | 27.7 | |||||||||||||||||||||||
Benefit Obligation | |||||||||||||||||||||||||
Weighted-Average Actuarial Assumptions | The table below provides the weighted-average actuarial assumptions used to determine the benefit obligations of the Company’s plans. | ||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
As of December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Discount rate | 3.9 | % | 4.8 | % | 4 | % | 4.9 | % | |||||||||||||||||
Rate of compensation increase (salaried) | 3 | % | 3 | % | N/A | N/A | |||||||||||||||||||
Benefit Costs | |||||||||||||||||||||||||
Weighted-Average Actuarial Assumptions | The table below provides the weighted-average actuarial assumptions used to determine the net periodic benefit cost. | ||||||||||||||||||||||||
Pension Plans | Post-retirement Benefits | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | Year ended | Year ended | Year ended | ||||||||||||||||||||
December 31, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||
2014 | 2013 | 2012 | 2014 | 2013 | 2012 | ||||||||||||||||||||
Discount rate | 4.8 | % | 3.9 | % | 4.6 | % | 4.9 | % | 4.1 | % | 4.6 | % | |||||||||||||
Rate of compensation increase (salaried) | 3 | % | 3 | % | 4 | % | N/A | N/A | N/A | ||||||||||||||||
Expected return on assets | 6.8 | % | 7 | % | 7 | % | N/A | N/A | N/A |
STOCKBASED_COMPENSATION_Tables
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Assumptions Used to Calculate Fair Value of Option Award | When options are granted, the Company uses a Black-Scholes option pricing model to calculate the fair value of each option award using the assumptions noted in the following table: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Expected volatility | 38 | % | 51 | % | N/A | ||||||||
Expected dividend yield | 1.6 | % | 1.2 | % | N/A | ||||||||
Expected term (in years) | 5.5 | 5.4 | N/A | ||||||||||
Expected forfeitures | 0 | % | 0 | % | N/A | ||||||||
Risk-free rate | 1.7 | % | 1.6 | % | N/A | ||||||||
Option Activity | A summary of option activity as of December 31, 2014, 2013 and 2012, and changes during the period then ended is presented below: | ||||||||||||
Options | Weighted- | Weighted-Average | |||||||||||
(in millions) | Average Exercise | Remaining | |||||||||||
Price | Contractual Term | ||||||||||||
Outstanding as of December 31, 2011 | 14.9 | $ | 13.4 | 4.94 years | |||||||||
Exercisable as of December 31, 2011 | 11.5 | $ | 13.37 | 4.88 years | |||||||||
Granted | — | — | |||||||||||
Exercised | (2.7 | ) | — | ||||||||||
Forfeited or expired | (0.3 | ) | — | ||||||||||
Outstanding as of December 31, 2012 | 11.9 | $ | 14.01 | 4.93 years | |||||||||
Exercisable as of December 31, 2012 | 11.8 | $ | 14.02 | 4.91 years | |||||||||
Granted | 0.6 | $ | 23.39 | ||||||||||
Exercised | (3.8 | ) | — | ||||||||||
Forfeited or expired | — | — | |||||||||||
Outstanding as of December 31, 2013 | 8.7 | $ | 15.33 | 4.30 years | |||||||||
Exercisable as of December 31, 2013 | 8.1 | $ | 14.79 | 3.94 years | |||||||||
Granted | 0.4 | $ | 30.23 | ||||||||||
Exercised | (4.2 | ) | — | ||||||||||
Forfeited or expired | — | — | |||||||||||
Outstanding as of December 31, 2014 | 4.9 | $ | 17.49 | 4.19 years | |||||||||
Exercisable as of December 31, 2014 | 3.9 | $ | 15.32 | 3.08 years | |||||||||
Restricted Stock Units (RSUs) | |||||||||||||
Non-Vested Shares Activity | A summary of RSU activity as of December 31, 2014, 2013 and 2012, and changes during the period then ended is presented below: | ||||||||||||
Non-vested RSUs: | RSUs | Weighted-Average | |||||||||||
(in millions) | Grant-Date | ||||||||||||
Fair Value | |||||||||||||
Non-vested as of December 31, 2011 | — | $ | — | ||||||||||
Granted | 1 | 20.2 | |||||||||||
Vested | — | — | |||||||||||
Forfeited | — | — | |||||||||||
Non-vested as of December 31, 2012 | 1 | $ | 20.2 | ||||||||||
Granted | 0.2 | 23.31 | |||||||||||
Vested | (0.4 | ) | 20.23 | ||||||||||
Forfeited | — | — | |||||||||||
Non-vested as of December 31, 2013 | 0.8 | $ | 20.9 | ||||||||||
Granted | 0 | 29.85 | |||||||||||
Vested | (0.6 | ) | 20.32 | ||||||||||
Forfeited | — | — | |||||||||||
Non-vested as of December 31, 2014 | 0.2 | $ | 26.57 | ||||||||||
Employee Stock Option | |||||||||||||
Non-Vested Shares Activity | A summary of the status of the Company’s non-vested stock options as of December 31, 2014, 2013 and 2012, and changes during the period ended December 31, 2014, 2013 and 2012 is presented below: | ||||||||||||
Non-vested Stock Options: | Options | Weighted-Average | |||||||||||
(in millions) | Grant-Date | ||||||||||||
Fair Value | |||||||||||||
Non-vested at December 31, 2011 | 3.4 | $ | 2.81 | ||||||||||
Granted | — | — | |||||||||||
Vested | (2.9 | ) | 2.58 | ||||||||||
Forfeited | (0.3 | ) | 4 | ||||||||||
Non-vested at December 31, 2012 | 0.2 | $ | 4.34 | ||||||||||
Granted | 0.6 | 9.76 | |||||||||||
Vested | (0.2 | ) | 3.59 | ||||||||||
Forfeited | — | — | |||||||||||
Non-vested at December 31, 2013 | 0.6 | $ | 9.06 | ||||||||||
Granted | 0.4 | 9.51 | |||||||||||
Vested | — | — | |||||||||||
Forfeited | — | — | |||||||||||
Non-vested at December 31, 2014 | 1 | $ | 9.44 | ||||||||||
Restricted Stock | |||||||||||||
Non-Vested Shares Activity | A summary of restricted stock activity as of December 31, 2014 and changes during the period then ended is presented below: | ||||||||||||
Non-vested Shares: | Restricted | Weighted-Average | |||||||||||
Stock | Grant-Date Fair | ||||||||||||
(in millions) | Value | ||||||||||||
Non-vested as of December 31, 2013 | — | $ | — | ||||||||||
Granted | 0.2 | 29.47 | |||||||||||
Vested | — | — | |||||||||||
Forfeited | — | — | |||||||||||
Non-vested as of December 31, 2014 | 0.2 | $ | 29.47 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Loss Before Income Taxes | Income before income taxes included the following (dollars in millions): | ||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
U.S. income | $ | 355.1 | $ | 259 | $ | 204.1 | |||||||
Foreign income | 13 | 7.1 | 12.1 | ||||||||||
Total | $ | 368.1 | $ | 266.1 | $ | 216.2 | |||||||
Provision for Income Tax Expense | The provision for income tax expense (benefit) was estimated as follows (dollars in millions): | ||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Estimated current income taxes: | |||||||||||||
U.S. federal | $ | 1.6 | $ | 0.2 | $ | 1.5 | |||||||
Foreign | 6.3 | 1.9 | 3.9 | ||||||||||
U.S. state and local | (0.2 | ) | 0.6 | 0.4 | |||||||||
Total Current | 7.7 | 2.7 | 5.8 | ||||||||||
Deferred income tax expense (credit), net: | |||||||||||||
U.S. federal | 125.6 | 87.6 | (282.5 | ) | |||||||||
Foreign | (0.3 | ) | 0.1 | 0.1 | |||||||||
U.S. state and local | 6.5 | 10.3 | (21.4 | ) | |||||||||
Total Deferred | 131.8 | 98 | (303.8 | ) | |||||||||
Total income tax expense (benefit) | $ | 139.5 | $ | 100.7 | $ | (298.0 | ) | ||||||
Reconciliation of Provision for Income Tax Expense (Benefit) | A reconciliation of the provision for income tax expense (benefit) compared with the amounts at the U.S. federal statutory rate is as follows (dollars in millions): | ||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Tax at U.S. statutory income tax rate | $ | 128.9 | $ | 93.1 | $ | 75.7 | |||||||
Foreign rate differential | (2.3 | ) | (0.7 | ) | (2.6 | ) | |||||||
Non-deductible expenses | 3.9 | 0.8 | 4.2 | ||||||||||
Valuation allowance | 2.6 | 1 | (384.1 | ) | |||||||||
State tax expense | 4 | 7.3 | 5.7 | ||||||||||
Adjustment to deferred tax expense | 2.4 | (0.3 | ) | 2.2 | |||||||||
Other adjustments | (0.0 | ) | (0.5 | ) | 0.9 | ||||||||
Total income tax expense (benefit) | $ | 139.5 | $ | 100.7 | $ | (298.0 | ) | ||||||
Deferred Tax Assets and Liabilities | Temporary differences and carryforwards that gave rise to deferred tax assets and liabilities included the following (dollars in millions): | ||||||||||||
As of | As of | ||||||||||||
December 31, | December 31, | ||||||||||||
2014 | 2013 | ||||||||||||
Deferred tax assets: | |||||||||||||
Inventories | $ | 5.1 | $ | 4.6 | |||||||||
Warranty accrual | 30.5 | 32.7 | |||||||||||
Sales allowances and rebates | 6.7 | 7.9 | |||||||||||
Deferred revenue | 25.7 | 24 | |||||||||||
Post-retirement health care | 5.7 | — | |||||||||||
Intangibles | 77.3 | 83.6 | |||||||||||
Other accrued liabilities | 32.7 | 27.2 | |||||||||||
Unrealized loss on interest rate derivatives | 5.7 | 3.7 | |||||||||||
Operating loss carryforwards | 107.8 | 140.7 | |||||||||||
Stock based compensation | 6.9 | 12.5 | |||||||||||
Technology-related investments | 6.6 | 6.8 | |||||||||||
Loan fees | — | 0.9 | |||||||||||
Other | 16.4 | 10.4 | |||||||||||
Total Deferred tax assets | 327.1 | 355 | |||||||||||
Valuation allowances | (5.2 | ) | (2.8 | ) | |||||||||
Deferred tax liabilities: | |||||||||||||
Property, plant and equipment | (20.2 | ) | (22.0 | ) | |||||||||
Goodwill | (320.8 | ) | (280.3 | ) | |||||||||
Trade name | (90.3 | ) | (60.6 | ) | |||||||||
Product warranty liabilities | (4.3 | ) | (5.6 | ) | |||||||||
Pension | — | (0.5 | ) | ||||||||||
Post-retirement health care | — | (0.2 | ) | ||||||||||
Other | (3.5 | ) | — | ||||||||||
Total Deferred tax liabilities | (439.1 | ) | (369.2 | ) | |||||||||
Net Deferred tax liability | $ | (117.2 | ) | $ | (17.0 | ) | |||||||
Liability for Unrecognized Tax Benefit | The change in the liability for unrecognized tax benefits are as follows (dollars in millions): | ||||||||||||
December 31, 2012 | $ | — | |||||||||||
December 31, 2013 | $ | 2.3 | |||||||||||
Increases in unrecognized tax benefits as a result of current year activity | 0.2 | ||||||||||||
December 31, 2014 | $ | 2.5 | |||||||||||
OTHER_COMPREHENSIVE_LOSS_Table
OTHER COMPREHENSIVE LOSS (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Changes in Components of Accumulated Other Comprehensive Loss | The changes in components of accumulated other comprehensive loss consisted of the following (dollars in millions): | ||||||||||||
Before Tax | Tax (Expense) | After Tax | |||||||||||
Benefit | |||||||||||||
Balance at December 31, 2011 | $ | (33.2 | ) | $ | (23.8 | ) | $ | (57.0 | ) | ||||
Foreign currency translation | (0.7 | ) | — | (0.7 | ) | ||||||||
Pension and OPEB liability adjustment | 26.7 | (11.6 | ) | 15.1 | |||||||||
Available-for-sale securities | (2.0 | ) | 0.7 | (1.3 | ) | ||||||||
Net current period other comprehensive loss | $ | 24 | $ | (10.9 | ) | $ | 13.1 | ||||||
Balance at December 31, 2012 | $ | (9.2 | ) | $ | (34.7 | ) | $ | (43.9 | ) | ||||
Foreign currency translation | (5.0 | ) | — | (5.0 | ) | ||||||||
Pension and OPEB liability adjustment | 46.4 | (17.4 | ) | 29 | |||||||||
Available-for-sale securities | (1.9 | ) | 0.8 | (1.1 | ) | ||||||||
Net current period other comprehensive income | $ | 39.5 | $ | (16.6 | ) | $ | 22.9 | ||||||
Balance at December 31, 2013 | $ | 30.3 | $ | (51.3 | ) | $ | (21.0 | ) | |||||
Foreign currency translation | (7.4 | ) | — | (7.4 | ) | ||||||||
Pension and OPEB liability adjustment | (14.6 | ) | 5.5 | (9.1 | ) | ||||||||
Available-for-sale securities | (3.2 | ) | 1.2 | (2.0 | ) | ||||||||
Net current period other comprehensive loss | $ | (25.2 | ) | $ | 6.7 | $ | (18.5 | ) | |||||
Balance at December 31, 2014 | $ | 5.1 | $ | (44.6 | ) | $ | (39.5 | ) | |||||
Consolidated Statements of Comprehensive Income Affected by Reclassifications from by AOCL | The following table shows the location in the Consolidated Statements of Comprehensive Income affected by reclassifications from AOCL (dollars in millions): | ||||||||||||
For the year ended December 31, 2014 | |||||||||||||
AOCL Components | Amount | Affected line item in the consolidated | |||||||||||
reclassified from | statements of comprehensive income | ||||||||||||
AOCL | |||||||||||||
Amortization of defined benefit pension items: | |||||||||||||
Prior service cost | $ | 3.2 | Cost of sales | ||||||||||
0.3 | Selling, general and | ||||||||||||
administrative | |||||||||||||
0.1 | Engineering – research and | ||||||||||||
development | |||||||||||||
Actuarial loss | 0.7 | Cost of sales | |||||||||||
(0.0 | ) | Selling, general and | |||||||||||
administrative | |||||||||||||
(0.0 | ) | Engineering – research and | |||||||||||
development | |||||||||||||
Total reclassifications, before tax | 4.3 | Income before income | |||||||||||
taxes | |||||||||||||
Income tax expense | (1.6 | ) | Tax expense | ||||||||||
Total reclassifications | $ | 2.7 | Net of tax | ||||||||||
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Future Payments under Non-Cancelable Operating Leases | As of December 31, 2014, future payments under non-cancelable operating leases are as follows over each of the next five years and thereafter (dollars in millions): | ||||
2015 | $ | 4.6 | |||
2016 | 2.8 | ||||
2017 | 1.7 | ||||
2018 | 0.8 | ||||
2019 | 0.6 | ||||
Thereafter | 2 | ||||
Total | $ | 12.5 | |||
CONCENTRATION_OF_RISK_Tables
CONCENTRATION OF RISK (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Schedules of Concentration of Risk by Risk Factor | Three customers accounted for greater than 10% of net sales within the last three years presented. | ||||||||||||
Years ended December 31, | |||||||||||||
% of net sales | 2014 | 2013 | 2012 | ||||||||||
Daimler AG | 17 | % | 17 | % | 13 | % | |||||||
Navistar, Inc. | 10 | % | 10 | % | 11 | % | |||||||
Oshkosh Corporation | 4 | % | 8 | % | 11 | % | |||||||
No other customers accounted for more than 10% of net sales of the Company during the years ended December 31, 2014, 2013 or 2012. | |||||||||||||
Three customers accounted for greater than 10% of outstanding accounts receivable within the last two years presented. | |||||||||||||
% of accounts receivable | As of | As of | |||||||||||
December 31, | December 31, | ||||||||||||
2014 | 2013 | ||||||||||||
Daimler AG | 15 | % | 15 | % | |||||||||
Navistar, Inc. | 12 | % | 10 | % | |||||||||
AB Volvo. | 8 | % | 11 | % | |||||||||
No other customers accounted for more than 10% of the outstanding accounts receivable as of December 31, 2014 or December 31, 2013. | |||||||||||||
One supplier accounted for greater than 10% of materials purchased for the periods presented: | |||||||||||||
Years ended December 31, | |||||||||||||
% of material purchased | 2014 | 2013 | 2012 | ||||||||||
Linamar Corporation Inc. | 10 | % | 13 | % | 13 | % |
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Reconciliation of Numerators and Denominators Used to Calculate Basic EPS and Diluted EPS | The following table reconciles the numerators and denominators used to calculate basic EPS and diluted EPS (in millions, except per share data): | ||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income | $ | 228.6 | $ | 165.4 | $ | 514.2 | |||||||
Weighted average shares of common stock outstanding | 179.8 | 184.5 | 182 | ||||||||||
Dilutive effect stock-based awards | 2.5 | 3.4 | 4.2 | ||||||||||
Diluted weighted average shares of common stock outstanding | 182.3 | 187.9 | 186.2 | ||||||||||
Basic earnings per share attributable to common stockholders | $ | 1.27 | $ | 0.9 | $ | 2.83 | |||||||
Diluted earnings per share attributable to common stockholders | $ | 1.25 | $ | 0.88 | $ | 2.76 | |||||||
GEOGRAPHIC_INFORMATION_Tables
GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Net Sales by Country | The Company had the following net sales by country as follows (dollars in millions): | ||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States | $ | 1,578.00 | $ | 1,354.30 | $ | 1,509.60 | |||||||
China | 128.7 | 141 | 136.4 | ||||||||||
Canada | 85.1 | 88.6 | 123 | ||||||||||
Japan | 45.8 | 37 | 52 | ||||||||||
Germany | 38.1 | 53.9 | 39.1 | ||||||||||
United Kingdom | 36.8 | 42.5 | 74.1 | ||||||||||
Other | 214.9 | 209.5 | 207.6 | ||||||||||
Total | $ | 2,127.40 | $ | 1,926.80 | $ | 2,141.80 | |||||||
Schedule of Disclosure of Long-Lived Assets by Geographic Location | The Company had net long-lived assets by country as follows (dollars in millions): | ||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
United States | $ | 442.6 | $ | 478.7 | $ | 493.6 | |||||||
India | 51.5 | 59.9 | 76.8 | ||||||||||
Hungary | 15.1 | 18.1 | 18.4 | ||||||||||
Others | 5.4 | 6.7 | 7.4 | ||||||||||
Total | $ | 514.6 | $ | 563.4 | $ | 596.2 | |||||||
QUARTERLY_FINANCIAL_INFORMATIO1
QUARTERLY FINANCIAL INFORMATION (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Quarterly Data | The following is a summary of the unaudited quarterly results of operations. The Company believes that all adjustments considered necessary for a fair presentation in accordance with GAAP have been included (unaudited, in millions, except per share data). | ||||||||||||||||
Quarters ended, | |||||||||||||||||
March 31 | June 30 | September 30 | December 31 | ||||||||||||||
2014 | |||||||||||||||||
Net sales | $ | 493.6 | $ | 536.1 | $ | 553.3 | $ | 544.4 | |||||||||
Gross profit | 222.5 | 238.5 | 259.3 | 255.6 | |||||||||||||
Operating income | 114.8 | 132.2 | 147.3 | 117.8 | |||||||||||||
Income before income taxes | 79.3 | 94.7 | 116.3 | 77.8 | |||||||||||||
Net income | 52.1 | 57.2 | 68.8 | 50.5 | |||||||||||||
Basic earnings per share | $ | 0.29 | $ | 0.32 | $ | 0.38 | $ | 0.28 | |||||||||
Diluted earnings per share | $ | 0.28 | $ | 0.31 | $ | 0.38 | $ | 0.28 | |||||||||
2013 | |||||||||||||||||
Net sales | $ | 457.4 | $ | 512.1 | $ | 466.3 | $ | 491 | |||||||||
Gross profit | 198.3 | 226.1 | 206.1 | 211.4 | |||||||||||||
Operating income | 81.4 | 117.7 | 111.2 | 99.6 | |||||||||||||
Income before income taxes | 44.4 | 81.8 | 72.4 | 67.5 | |||||||||||||
Net income | 27.5 | 50.5 | 44.5 | 42.9 | |||||||||||||
Basic earnings per share | $ | 0.15 | $ | 0.27 | $ | 0.24 | $ | 0.24 | |||||||||
Diluted earnings per share | $ | 0.15 | $ | 0.26 | $ | 0.24 | $ | 0.23 |
Overview_Additional_Informatio
Overview - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
Product | |
Customer | |
Employee | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | |
Transmission product lines | 13 |
Worldwide independent distributor and dealer locations | 1,400 |
Number of employees | 2,700 |
Revenues | North America | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Line Items] | |
Concentration of risk, percentage | 80.00% |
Recovered_Sheet1
Summary of Significant Accounting Polices - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Segment | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Number of operating segment | 1 | ||
Number of reportable segment | 1 | ||
Highly-liquid investments with original maturities | 90 days | ||
Loss associated with impairment of long-lived assets | $15.40 | ||
Accrued expenses related to impaired long-lived assets | 1.7 | ||
Amortization of deferred financing costs | 8.1 | 10.9 | 14.5 |
Sales incentives | 66.9 | 65.2 | 59.9 |
Military price reduction reserve | 63.1 | 49.6 | |
Deferred revenue recognized | 8.8 | ||
Engineering services revenue | 7.4 | 12.4 | 7.8 |
Increase in defined benefit obligation due to one percentage point decrease in assumed discount rate | 22.3 | ||
Pension Plans | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Increase in defined benefit obligation due to one percentage point decrease in assumed discount rate | 20 | ||
Post-retirement Benefits | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Increase in defined benefit obligation due to one percentage point decrease in assumed discount rate | $23.70 | ||
Minimum | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Extended Transmission Coverage sales, recognition period | 2 years | ||
Maximum | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Extended Transmission Coverage sales, recognition period | 5 years |
Property_Plant_and_Equipment_E
Property Plant and Equipment Estimated Lives (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
Minimum | Land Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 5 years |
Minimum | Building and Building Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 10 years |
Minimum | Machinery and Equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 2 years |
Minimum | Software | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 2 years |
Minimum | Special tools | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 2 years |
Maximum | Land Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 30 years |
Maximum | Building and Building Improvements | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 40 years |
Maximum | Machinery and Equipment | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 20 years |
Maximum | Software | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 5 years |
Maximum | Special tools | |
Property, Plant and Equipment [Line Items] | |
Property, plant and equipment, estimated Lives | 10 years |
Components_of_Inventories_Deta
Components of Inventories (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Inventory [Line Items] | ||
Purchased parts and raw materials | $72.30 | $79.70 |
Work in progress | 6.1 | 5.7 |
Service parts | 46.5 | 45.8 |
Finished goods | 18.6 | 29.2 |
Total inventories | $143.50 | $160.40 |
Cost_and_Accumulated_Depreciat
Cost and Accumulated Depreciation of Property Plant and Equipment (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | |||
Property, Plant and Equipment [Line Items] | |||
Land and land improvements | $23.60 | $20.30 | |
Buildings and building improvements | 281.6 | 271.4 | |
Machinery and equipment | 576.2 | 567.7 | |
Software | 117 | 112.9 | |
Special tools | 143.6 | 143.4 | |
Construction in progress | 39.9 | 48.6 | |
Total property, plant and equipment | 1,181.90 | 1,164.30 | |
Accumulated depreciation | -667.3 | -600.9 | |
Property, plant and equipment, net | $514.60 | $563.40 | $596.20 |
Property_Plant_and_Equipment_A
Property Plant and Equipment - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Property, Plant and Equipment [Line Items] | |||
Depreciation of property, plant and equipment | $93.80 | $98.70 | $102.50 |
Recovered_Sheet2
Goodwill and Other Intangible Assets - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill [Line Items] | |||
Goodwill | $1,941 | $1,941 | |
Amortization of intangible assets | 98.8 | 105.3 | 150 |
Net carrying value of Goodwill and other intangible assets | $3,453 |
Summary_of_Goodwill_and_Other_
Summary of Goodwill and Other Intangible Assets (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Goodwill and Intangible Assets Disclosure [Line Items] | ||
Trade name | $870 | $870 |
Intangible assets, gross | 2,551 | 2,551 |
Accumulated amortization | -1,039 | -940.2 |
Intangible assets, net | 1,512 | 1,610.80 |
Customer relationships - defense | ||
Goodwill and Intangible Assets Disclosure [Line Items] | ||
Intangible assets, gross | 62.3 | 62.3 |
Accumulated amortization | -27.9 | -24.4 |
Intangible assets, net | 34.4 | 37.9 |
Customer relationships - commercial | ||
Goodwill and Intangible Assets Disclosure [Line Items] | ||
Intangible assets, gross | 831.8 | 831.8 |
Accumulated amortization | -426.9 | -374.9 |
Intangible assets, net | 404.9 | 456.9 |
Proprietary technology | ||
Goodwill and Intangible Assets Disclosure [Line Items] | ||
Intangible assets, gross | 476.3 | 476.3 |
Accumulated amortization | -282 | -243.9 |
Intangible assets, net | 194.3 | 232.4 |
Non-compete agreement | ||
Goodwill and Intangible Assets Disclosure [Line Items] | ||
Intangible assets, gross | 17.3 | 17.3 |
Accumulated amortization | -12.8 | -11.1 |
Intangible assets, net | 4.5 | 6.2 |
Patented technology - defense | ||
Goodwill and Intangible Assets Disclosure [Line Items] | ||
Intangible assets, gross | 28.2 | 28.2 |
Accumulated amortization | -24.5 | -21.2 |
Intangible assets, net | 3.7 | 7 |
Tooling rights | ||
Goodwill and Intangible Assets Disclosure [Line Items] | ||
Intangible assets, gross | 4.5 | 4.5 |
Accumulated amortization | -4.3 | -4.1 |
Intangible assets, net | 0.2 | 0.4 |
Patented technology - commercial | ||
Goodwill and Intangible Assets Disclosure [Line Items] | ||
Intangible assets, gross | 260.6 | 260.6 |
Accumulated amortization | ($260.60) | ($260.60) |
Expected_Amortization_Expense_
Expected Amortization Expense Related to Other Intangible Assets (Detail) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Finite-Lived Intangible Assets | |
2015 | $97.10 |
2016 | 92.4 |
2017 | 89.7 |
2018 | 87.2 |
2019 | 85.7 |
Thereafter | $189.90 |
Fair_Value_of_Financial_Assets
Fair Value of Financial Assets and Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | $55 | $5 |
Available-for-sale securities | 8.6 | 8.2 |
Rabbi trust assets | 2.9 | 1.3 |
Deferred compensation obligation | -2.9 | -1.3 |
Derivative assets | 0 | 1.6 |
Derivative liabilities | -15.4 | -21.4 |
Total | 48.2 | -6.6 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 55 | 5 |
Available-for-sale securities | 8.6 | 8.2 |
Rabbi trust assets | 2.9 | 1.3 |
Deferred compensation obligation | -2.9 | -1.3 |
Total | 63.6 | 13.2 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 0 | 1.6 |
Derivative liabilities | -15.4 | -21.4 |
Total | ($15.40) | ($19.80) |
Long_Term_Debt_and_Maturities_
Long Term Debt and Maturities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $2,520.50 | $2,678.30 |
Less: current maturities of long-term debt | 17.9 | 17.9 |
Total long-term debt less current portion | 2,502.60 | 2,660.40 |
Total long-term debt | 2,520.50 | 2,678.30 |
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 283.6 | 423.5 |
Total long-term debt | 283.6 | 423.5 |
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 1,765.60 | 1,783.50 |
Total long-term debt | 1,765.60 | 1,783.50 |
Senior Notes, fixed 7.125%, due 2019 | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 471.3 | 471.3 |
Total long-term debt | $471.30 | $471.30 |
Long_Term_Debt_and_Maturities_1
Long Term Debt and Maturities (Parenthetical) (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | |
Debt Instrument [Line Items] | |
Debt instrument, due date | 2017 |
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | |
Debt Instrument [Line Items] | |
Debt instrument, due date | 2019 |
Senior Notes, fixed 7.125%, due 2019 | |
Debt Instrument [Line Items] | |
Interest rate of Senior Notes | 7.13% |
Debt instrument, due date | 2019 |
Principal_Payments_Required_on
Principal Payments Required on Long Term Debt (Detail) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Long Term Debt [Line Items] | |
2015 | $17.90 |
2016 | 17.9 |
2017 | 301.4 |
2018 | 17.9 |
2019 | $2,165.40 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 12 Months Ended | 1 Months Ended | ||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Aug. 31, 2012 | Dec. 31, 2007 | Feb. 28, 2013 | Dec. 31, 2013 | Aug. 30, 2013 | Oct. 31, 2012 | Apr. 30, 2014 |
Debt Instrument [Line Items] | ||||||||||
Total long-term debt | $2,520.50 | $2,678.30 | $2,678.30 | |||||||
Fair value of long-term debt obligations | 2,515.90 | |||||||||
Additional deferred financing fees recorded | 0.9 | 14.9 | 20.2 | |||||||
Deferred financing fees | 8.1 | 10.9 | 14.5 | |||||||
Long-term debt repayment | 157.6 | 142.4 | 245.4 | |||||||
Losses associated with deferred debt issuance costs on principal payments | 0.5 | 0.8 | 22.1 | |||||||
Total leverage ratio | 305.00% | |||||||||
Maximum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Annual excess cash flow to prepay term loan | 50.00% | |||||||||
Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Extended Senior Secured Credit Facility, principal amount | 801.1 | |||||||||
Applicable margin over base rate | 3.50% | |||||||||
Additional deferred financing fees recorded | 16.1 | |||||||||
Debt instrument face amount | 850 | |||||||||
Weighted average rate on the Senior Secured Credit Facility | 3.64% | |||||||||
Line of Credit | Amendment Agreement | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Deferred financing fees | 4.5 | |||||||||
Line of Credit | Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 0.50% | 0.50% | ||||||||
Line of Credit | Variable Interest Rate Option One | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 3.00% | |||||||||
Line of Credit | Variable Interest Rate Option One | Prime Rate or Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.00% | |||||||||
Line of Credit | Variable Interest Rate Option Two | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 3.25% | |||||||||
Line of Credit | Variable Interest Rate Option Two | Prime Rate or Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.25% | |||||||||
Line of Credit | Minimum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Extended period of amortization on deferred financing fees | 2014 | |||||||||
Line of Credit | Maximum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Extended period of amortization on deferred financing fees | 2017 | |||||||||
Senior Secured Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Additional deferred financing fees recorded | 1.6 | |||||||||
Deferred financing fees | 1 | |||||||||
Revolving Credit Facility | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Additional deferred financing fees recorded | 2.1 | |||||||||
Deferred financing fees | 0.6 | 0.4 | ||||||||
Revolving credit borrowings | 465 | 410 | 410 | |||||||
Maturity date of revolving credit borrowings | 2019-01 | 2019-01 | ||||||||
Line of Credit Facility, commitment fee percentage | 0.25% | |||||||||
Maximum amount of letters of credit commitments available under the revolving credit facility | 75 | 75 | 75 | |||||||
Maximum amount outstanding at any time on the revolving credit facility | 40 | |||||||||
Available revolving credit facility | 455.1 | |||||||||
Letters of Credit | 9.9 | |||||||||
Revolving credit borrowings, interest rate | 1.92% | |||||||||
Required senior secured leverage ratio | 550.00% | |||||||||
Achieved senior secured leverage ratio | 242.00% | |||||||||
Minimum senior secured leverage ratio | 350.00% | |||||||||
Basis point reduction to applicable margin, resulting from total leverage ratio below minimum | 0.25% | |||||||||
Basis point reduction to commitment fee, resulting from total leverage ratio below minimum | 0.13% | |||||||||
Revolving Credit Facility | Variable Interest Rate Option One | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.25% | |||||||||
Revolving Credit Facility | Variable Interest Rate Option One | Base Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 1.25% | |||||||||
Revolving Credit Facility | Variable Interest Rate Option Two | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.00% | |||||||||
Revolving Credit Facility | Variable Interest Rate Option Two | Base Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 1.00% | |||||||||
Revolving Credit Facility | Variable Interest Rate Option Three | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 1.75% | |||||||||
Revolving Credit Facility | Variable Interest Rate Option Three | Base Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 0.75% | |||||||||
Revolving Credit Facility | Minimum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, commitment fee percentage | 0.25% | |||||||||
Revolving Credit Facility | Maximum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Line of Credit Facility, commitment fee percentage | 0.38% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, due 2017 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Additional deferred financing fees recorded | 2.3 | |||||||||
Deferred financing fees for which the amortization period was extended as a result of debt modification | 5.1 | |||||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total long-term debt | 1,765.60 | 1,783.50 | 1,783.50 | |||||||
Additional deferred financing fees recorded | 10.1 | 1 | 1.8 | |||||||
Debt instrument face amount | 650 | 650 | ||||||||
Senior Secured Credit Facility, extended maturity date | 2019-08 | 2019-08 | ||||||||
Variable interest rate, description | In August 2012, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $850.0 million of term loan debt from August 2014 to August 2019 and to increase the applicable margin at the Company's option to either (a) 3.25% or 3.00%, subject to the Company's total leverage ratio, over the LIBOR (which may not be less than 1.00%) or (b) 2.25% or 2.00%, subject to the Company's total leverage ratio, | |||||||||
Deferred financing fees | 0.5 | 2.1 | 1.4 | |||||||
Total interest rate for term loan | 3.75% | |||||||||
Principal payments on term loans | 4.5 | |||||||||
Debt instrument, due date | 2019 | |||||||||
Basis point reduction to applicable margin, resulting from total leverage ratio below minimum | 0.25% | |||||||||
Total leverage ratio | 325.00% | |||||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Credit facility refinanced amount | 1,139.30 | |||||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | Prime Rate or Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 0.50% | 0.50% | 0.50% | |||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | Variable Interest Rate Option One | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.75% | 2.75% | 3.25% | |||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | Variable Interest Rate Option One | Prime Rate or Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 1.75% | 1.75% | 2.25% | |||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | Variable Interest Rate Option Two | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.50% | 2.50% | 3.00% | |||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | Variable Interest Rate Option Two | Prime Rate or Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 1.50% | 1.50% | 2.00% | |||||||
Senior Secured Credit Facility Term B-3 Loan, variable, due 2019 | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior Secured Credit Facility, extended maturity date | 2019-08 | |||||||||
Variable interest rate, description | In October 2012, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $300.0 million of term loan debt from August 2014 to August 2019 and to increase the applicable margin at the Company's option to either (a) 3.25% or 3.00%, subject to the Company's total leverage ratio, over the LIBOR (which may not be less than 1.00%) or (b) 2.25% or 2.00%, subject to the Company's total leverage ratio, | |||||||||
Credit facility refinance description | In August 2013, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to refinance $1,139.3 million of term loan debt and decrease the applicable margin for such term loans at the Company's option to either (a) 2.75% or 2.50%, subject to the Company's total leverage ratio, over the LIBOR (which may not be less than 1.00%) or (b) 1.75% or 1.50%, subject to the Company's total leverage ratio, over the greater of the prime lending | In December 2013, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $650.0 million of term loan debt from August 2017 to August 2019 and to reduce the applicable margin at the Company's option to either (a) 2.75% or 2.50%, subject to the Company's total leverage ratio, over the LIBOR (which may not be less than 1.00%) or (b) 1.75% or 1.50%, subject to the Company's total leverage ratio | ||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total long-term debt | 283.6 | 423.5 | 423.5 | |||||||
Variable interest rate, description | In February 2013, ATI also entered into an additional amendment with the term loan lenders under its Senior Secured Credit Facility to extend the maturity of $411.4 million of term loan debt from August 2014 to August 2017 and to increase the applicable margin at the Company's option to either (a) 3.00% over the LIBOR or (b) 2.00% over the greater of the prime lending rate | |||||||||
Deferred financing fees | 0.3 | |||||||||
Credit facility refinance description | In February 2013, ATI entered into an amendment with the term loan lenders under its Senior Secured Credit Facility to refinance $793.1 million of term loan debt and decrease the applicable margin for such term loans at the Company's option to either (a) 3.00% over the LIBOR or (b) 2.00% over the greater of the prime lending rate | |||||||||
Total interest rate for term loan | 2.92% | |||||||||
Debt instrument, due date | 2017 | |||||||||
Long-term debt repayment | 140 | |||||||||
Losses associated with deferred debt issuance costs on principal payments | 0.5 | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Amendment | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior Secured Credit Facility Term loan, due date | 2017-08 | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 0.50% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.75% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | LIBOR | Refinanced Term Loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 3.00% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | LIBOR | Amendment | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 3.00% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Prime Rate or Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 1.75% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Prime Rate or Federal Funds Rate | Refinanced Term Loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 0.50% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Prime Rate or Federal Funds Rate | Amendment | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.00% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Minimum | Prime Rate or Federal Funds Rate | Refinanced Term Loan | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.00% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Line of Credit | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Debt instrument face amount | 411.4 | |||||||||
Credit facility refinanced amount | 793.1 | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Line of Credit | LIBOR | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 3.00% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Line of Credit | Prime Rate or Federal Funds Rate | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Applicable margin over base rate | 2.00% | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Line of Credit | Minimum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Extended period of amortization on deferred financing fees | 2014 | |||||||||
Senior Secured Credit Facility Term B-2 Loan, variable, due 2017 | Line of Credit | Maximum | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Extended period of amortization on deferred financing fees | 2017 | |||||||||
Senior Secured Credit Facility Term B-1 Loan, variable, due 2014 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Senior Secured Credit Facility Term loan, due date | 2014-08 | |||||||||
Senior Notes, fixed 7.125%, due 2019 | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Total long-term debt | 471.3 | 471.3 | 471.3 | |||||||
Interest rate of Senior Notes | 7.13% | |||||||||
Debt instrument face amount | $500 | |||||||||
Debt instrument, due date | 2019 | |||||||||
Senior Notes, fixed 7.125%, due 2019 | Allison Transmission Inc. | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Interest rate of Senior Notes | 7.13% |
Summary_of_Companys_Interest_R
Summary of Company's Interest Rate Derivatives (Detail) (Derivatives not designated as hedging instruments, USD $) | Dec. 31, 2014 | Dec. 31, 2013 | ||
In Millions, unless otherwise specified | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | $750 | $1,450 | ||
Fair Value | -14.4 | -18 | ||
3.75% Interest Rate Swap H, Aug 2011 - Aug 2014 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 350 | |||
Fair Value | -7.2 | |||
3.77% Interest Rate Swap I, Aug 2011 - Aug 2014 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 350 | |||
Fair Value | -7.2 | |||
2.96% Interest Rate Swap J, Aug 2013 - Aug 2014 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 125 | |||
Fair Value | -2 | |||
3.05% Interest Rate Swap K, Aug 2013 - Aug 2014 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 125 | |||
Fair Value | -2 | |||
3.44% Interest Rate Swap L, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 75 | [1] | 75 | [1] |
Fair Value | -2.3 | [1] | -0.4 | [1] |
3.43% Interest Rate Swap M, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 100 | [1] | 100 | [1] |
Fair Value | -3 | [1] | -0.4 | [1] |
3.37% Interest Rate Swap N, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 75 | [1] | 75 | [1] |
Fair Value | -2.1 | [1] | -0.2 | [1] |
3.19% Interest Rate Swap O, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 75 | [1] | 75 | [1] |
Fair Value | -1.7 | [1] | 0.2 | [1] |
3.08% Interest Rate Swap P, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 75 | [1] | 75 | [1] |
Fair Value | -1.5 | [1] | 0.4 | [1] |
2.99% Interest Rate Swap Q, Aug 2016 - Aug 2014 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 50 | [1] | 50 | [1] |
Fair Value | -0.9 | [1] | 0.4 | [1] |
2.98% Interest Rate Swap R, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 50 | [1] | 50 | [1] |
Fair Value | -0.9 | [1] | 0.4 | [1] |
2.73% Interest Rate Swap S, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 50 | [1] | ||
Fair Value | -0.5 | [1] | ||
2.74% Interest Rate Swap T, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 75 | [1] | ||
Fair Value | -0.8 | [1] | ||
2.66% Interest Rate Swap U, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 50 | [1] | ||
Fair Value | -0.4 | [1] | ||
2.60% Interest Rate Swap V, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 50 | [1] | ||
Fair Value | -0.3 | [1] | ||
2.40% Interest Rate Swap W, Aug 2016 - Aug 2019 | ||||
Derivatives, Fair Value [Line Items] | ||||
Notional Amount | 25 | [1] | ||
Fair Value | $0 | [1] | ||
[1] | includes LIBOR floor of 1.00% |
Summary_of_Companys_Interest_R1
Summary of Company's Interest Rate Derivatives (Parenthetical) (Detail) (Derivatives not designated as hedging instruments) | Dec. 31, 2014 | Dec. 31, 2013 |
LIBOR | ||
Derivatives, Fair Value [Line Items] | ||
LIBOR floor | 1.00% | 1.00% |
3.75% Interest Rate Swap H, Aug 2011 - Aug 2014 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 3.75% | 3.75% |
3.77% Interest Rate Swap I, Aug 2011 - Aug 2014 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 3.77% | 3.77% |
2.96% Interest Rate Swap J, Aug 2013 - Aug 2014 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 2.96% | 2.96% |
3.05% Interest Rate Swap K, Aug 2013 - Aug 2014 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 3.05% | 3.05% |
3.44% Interest Rate Swap L, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 3.44% | 3.44% |
3.43% Interest Rate Swap M, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 3.43% | 3.43% |
3.37% Interest Rate Swap N, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 3.37% | 3.37% |
3.19% Interest Rate Swap O, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 3.19% | 3.19% |
3.08% Interest Rate Swap P, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 3.08% | 3.08% |
2.99% Interest Rate Swap Q, Aug 2016 - Aug 2014 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 2.99% | 2.99% |
2.98% Interest Rate Swap R, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 2.98% | 2.98% |
2.73% Interest Rate Swap S, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 2.73% | 2.73% |
2.74% Interest Rate Swap T, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 2.74% | 2.74% |
2.66% Interest Rate Swap U, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 2.66% | 2.66% |
2.60% Interest Rate Swap V, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 2.60% | 2.60% |
2.40% Interest Rate Swap W, Aug 2016 - Aug 2019 | ||
Derivatives, Fair Value [Line Items] | ||
Derivative, Fixed Interest Rate | 2.40% | 2.40% |
Derivatives_Additional_Informa
Derivatives - Additional Information (Detail) (Derivatives not designated as hedging instruments, USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Derivative [Line Items] | ||
Amount of collateral recorded in Other current assets | $0 | $1.70 |
Foreign currency contracts | Other current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -0.3 | -0.3 |
Commodity contracts | Other current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -0.6 | -1.5 |
Commodity contracts | Other current assets | ||
Derivative [Line Items] | ||
Derivative Assets, Fair Value | 0.1 | |
Commodity contracts | Other non-current assets | ||
Derivative [Line Items] | ||
Derivative Assets, Fair Value | 0 | |
Commodity contracts | Other non-current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -0.1 | -0.2 |
Interest rate contracts | Other current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -18.5 | |
Interest rate contracts | Other non-current assets | ||
Derivative [Line Items] | ||
Derivative Assets, Fair Value | 1.5 | |
Interest rate contracts | Other non-current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | ($14.40) | ($1) |
Summary_of_Outstanding_Foreign
Summary of Outstanding Foreign Currency Forward Contracts (Detail) (Derivatives not designated as hedging instruments) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 |
In Millions, unless otherwise specified | USD ($) | USD ($) | Foreign currency contracts | Foreign currency contracts | Foreign currency contracts | Foreign currency contracts | Foreign currency contracts | Foreign currency contracts |
USD ($) | USD ($) | Japanese Yen | Japanese Yen | Japanese Yen | Japanese Yen | |||
USD ($) | JPY (¥) | USD ($) | JPY (¥) | |||||
Derivatives, Fair Value [Line Items] | ||||||||
Assets Fair Value | ($0.30) | ($0.30) | ||||||
Liabilities Fair Value | -0.3 | -0.3 | ||||||
Notional Amount | $750 | $1,450 | ¥ 300 | ¥ 600 |
Summary_of_Outstanding_Commodi
Summary of Outstanding Commodity Swaps (Detail) (Derivatives not designated as hedging instruments, USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
t | t | |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional Amount | $750 | $1,450 |
Fair value | -15.4 | -19.9 |
Commodity contracts | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Fair value | -0.7 | -1.6 |
Commodity contracts | Aluminum | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional Amount | 11.3 | 23.8 |
Quantity | 6,200 | 11,875 |
Fair value | -0.7 | -1.6 |
Commodity contracts | Natural Gas | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Notional Amount | 0.2 | 0.3 |
Quantity | 60,000 | 90,000 |
Fair value | $0 | $0 |
Companys_Derivative_Instrument
Company's Derivative Instruments and their Impact on Financial Condition of Company (Detail) (Derivatives not designated as hedging instruments, USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Derivative [Line Items] | ||
Total derivatives not designated as hedging instruments | ($15.40) | ($19.90) |
Foreign currency contracts | Other current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -0.3 | -0.3 |
Commodity contracts | ||
Derivative [Line Items] | ||
Total derivatives not designated as hedging instruments | -0.7 | -1.6 |
Commodity contracts | Other current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -0.6 | -1.5 |
Commodity contracts | Other current and non-current assets | ||
Derivative [Line Items] | ||
Derivative Assets, Fair Value | 0.1 | |
Commodity contracts | Other current and non-current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -0.7 | -1.7 |
Commodity contracts | Other non-current assets | ||
Derivative [Line Items] | ||
Derivative Assets, Fair Value | 0 | |
Interest rate contracts | Other current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -18.5 | |
Interest rate contracts | Other current and non-current liabilities | ||
Derivative [Line Items] | ||
Derivative Liability, Fair Value | -14.4 | -19.5 |
Interest rate contracts | Other non-current assets | ||
Derivative [Line Items] | ||
Derivative Assets, Fair Value | $1.50 |
Impact_on_the_Companys_Results
Impact on the Company's Results of Operations Related to Unrealized Gain (Loss) on Interest Rate Derivatives (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Derivative [Line Items] | |||
Unrealized gain on derivatives | $4.70 | $32.80 | $26.20 |
Derivatives not designated as hedging instruments | Interest rate contracts | Interest expense | |||
Derivative [Line Items] | |||
Unrealized gain on derivatives | $3.50 | $34.30 | $25.50 |
Product_Warranty_Liability_Act
Product Warranty Liability Activities (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Guarantor Obligations [Line Items] | |||
Beginning balance | $90.50 | $109.70 | $115.40 |
Payments | -35 | -38.7 | -47.3 |
Increase in liability (warranty issued during period) | 26.8 | 28.4 | 25.5 |
Net adjustments to liability | 0.7 | -9.6 | 15.3 |
Accretion (for Predecessor liabilities) | 0.6 | 0.7 | 0.8 |
Ending balance | $83.60 | $90.50 | $109.70 |
Product_Warranty_Liabilities_A
Product Warranty Liabilities - Additional Information (Detail) (USD $) | 12 Months Ended | 1 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2007 | Dec. 31, 2011 |
Guarantor Obligations [Line Items] | |||||
Product warranty liability, current | $24 | $37.40 | |||
Product warranty liability, non-current | 59.6 | 53.1 | |||
Increase (decrease) in extended Product liability | 3.9 | 8.2 | -7.9 | ||
Product warranty accrual reduction charged to DPIM receivable | 7.3 | ||||
Product warranty accrual reduction charged to comprehensive income | -1 | 2.4 | 0.6 | ||
Warranty liability | 83.6 | 90.5 | 109.7 | 115.4 | |
Warranty claims paid | 35 | 38.7 | 47.3 | ||
Product warranty accrual additional reserve | 10 | ||||
Extended Product warranty, charge to the Consolidated Statements of Comprehensive Income (Loss) | 10 | ||||
General Motors | |||||
Guarantor Obligations [Line Items] | |||||
Product warranty accrual reduction charged to DPIM receivable | 2.9 | 5.8 | |||
Reimbursement received | 14.9 | 9.1 | |||
Dual Power Inverter Module | |||||
Guarantor Obligations [Line Items] | |||||
Product warranty, qualified cost | 12 | ||||
Product warranty, qualified cost sharing ratio | 33.30% | ||||
Warranty liability | 48.5 | 44.6 | |||
Warranty claims paid | 32.8 | 25.5 | |||
Dual Power Inverter Module | General Motors | |||||
Guarantor Obligations [Line Items] | |||||
Product warranty, qualified cost | 34 | ||||
Product warranty, qualified cost sharing ratio | 66.70% | ||||
Other receivable | 28.7 | 25.8 | |||
Dual Power Inverter Module | Product Warranty | |||||
Guarantor Obligations [Line Items] | |||||
Product warranty, qualified cost | $46 |
Deferred_Revenue_Additional_In
Deferred Revenue - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred Revenue [Line Items] | |||
Deferred revenue current liabilities | $20.60 | $29.20 | |
Deferred revenue non-current liabilities | 48.7 | 43.2 | |
Deferred revenue recognized | 8.8 | ||
Extended Transmission Coverage | |||
Deferred Revenue [Line Items] | |||
Deferred revenue current liabilities | 20.3 | 20.4 | |
Deferred revenue non-current liabilities | 48.7 | 43.2 | |
Deferred revenue recognized | 20.8 | 21 | 19.9 |
U S Government Contracts | |||
Deferred Revenue [Line Items] | |||
Deferred revenue current liabilities | 0.3 | 8.8 | 0.7 |
Deferred revenue recognized | $8.80 |
Deferred_Revenue_for_ETC_Activ
Deferred Revenue for ETC Activity (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Deferred Revenue [Line Items] | |||
Revenue earned | ($8.80) | ||
Extended Transmission Coverage | |||
Deferred Revenue [Line Items] | |||
Beginning balance | 63.6 | 63.5 | 60.5 |
Increases | 26.2 | 21.1 | 22.9 |
Revenue earned | -20.8 | -21 | -19.9 |
Ending balance | $69 | $63.60 | $63.50 |
Other_Expense_Net_Detail
Other Expense Net (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Components of Other Income (Expense) [Line Items] | |||
Loss on intercompany foreign exchange | ($5.40) | ($2.30) | |
Grant program income | 2.6 | 5.2 | 11.5 |
Impairment loss on investments in technology-related initiatives | -2 | -5 | -14.4 |
Gain on negotiation of commercial agreement | 2 | ||
Public offering fees and expenses | -1.4 | -1.6 | -6.1 |
Unrealized gain (loss) on derivative contracts (see NOTE 8) | 1.2 | -1.5 | 0.9 |
Realized loss on derivative contracts (see NOTE 8) | -1 | -2.8 | -1.3 |
Loss on foreign exchange | -1 | -2.4 | -2.6 |
Loss on repayments and repurchases of long-term debt (see NOTE 7) | -0.5 | -0.8 | -22.1 |
Termination of services agreement | -16 | ||
Loss on re-measurement of employee benefit plans (see NOTE 13) | -2.3 | ||
Other | -0.1 | 0.3 | -0.4 |
Total | ($5.60) | ($10.90) | ($52.80) |
Other_Expense_Net_Additional_I
Other Expense, Net - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Other Income Expense [Line Items] | |||
Loss on intercompany foreign exchange | $5.40 | $2.30 | |
Payment for expansion of transmission technologies | $2 | $5 | $14.40 |
Other_Current_Liabilities_Deta
Other Current Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Other Current Liabilities [Line Items] | ||
Payroll and related costs | $50.90 | $32.70 |
Sales allowances | 25.5 | 26.9 |
Defense price reduction reserve | 16.2 | 26.8 |
Vendor buyback obligation | 13.2 | 11.8 |
Taxes payable | 8.5 | 8.6 |
Accrued interest payable | 5.2 | 11.2 |
Derivative liabilities | 0.8 | 20.2 |
Other accruals | 11.4 | 14.1 |
Total | $131.70 | $152.30 |
Employee_Benefit_Plans_Additio
Employee Benefit Plans - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||||
In Millions, unless otherwise specified | Dec. 31, 2012 | Jun. 30, 2012 | Dec. 31, 2014 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Actuarial gain (loss) | $17.90 | |||||
Non-cash settlement charge | 2.3 | |||||
Reduction in pension liability | 4.2 | |||||
Excise tax as a percentage of value of plan that exceeds the threshold amount | 40.00% | |||||
Effect of excise tax on post-retirement benefit obligation | 4 | |||||
Agreement period under post-retirement health care benefits | 5 years | |||||
Favorable adjustment to benefit obligation | -28.9 | |||||
Collective bargaining agreement, expiration period | 2017-11 | 2017-11 | ||||
Accumulated benefit obligation | 129.7 | 103.1 | ||||
Nonqualified Deferred Compensation Plan | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Deferred compensation expense | 0.2 | 0.3 | 0.1 | |||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Nonqualified Deferred Compensation Plan | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Plan assets, fair value | 2.9 | 2.9 | ||||
Plan obligation, fair value | 1.3 | 1.3 | ||||
Salary Plan | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Defined contribution plan expense | 5.4 | 5.4 | 5.1 | |||
Defined contribution plan, employer contribution for employee with severance date on or after January 1, 1993 | 1.00% | |||||
Defined contribution plan, employer matching contribution | 4.00% | |||||
Future Post Retirement Medical Care Costs | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Health care cost trend rate | 6.70% | |||||
Health care cost ultimate trend rate | 4.50% | |||||
Health care cost ultimate trend year | 2027 | |||||
Future Post Retirement Prescription Drug Costs | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Health care cost trend rate | 6.00% | |||||
Health care cost ultimate trend rate | 4.50% | |||||
Health care cost ultimate trend year | 2027 | |||||
Hourly Plan | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Defined benefit plan, service period before normal retirement age | 30 years | |||||
Defined contribution plan expense | 1.3 | 1 | 0.9 | |||
Post-retirement Benefits | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Actuarial gain (loss) | 7.8 | -30.7 | 3.8 | |||
Net benefit obligation | 142.6 | 136 | 156.6 | 120.7 | 142.6 | |
Deferred compensation obligation, additional recorded as a result of updated mortality assumption | 4.1 | |||||
Favorable adjustment to benefit obligation | -28.9 | |||||
Pension Plans | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Actuarial gain (loss) | 10.9 | -16.9 | 3.5 | |||
Net benefit obligation | 103.3 | 133.5 | 99.7 | 105.9 | 103.3 | |
Deferred compensation obligation, additional recorded as a result of updated mortality assumption | 2.9 | |||||
Asset Purchase Agreement | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Plan assets transferred | 18.8 | |||||
Hourly Employee | Post-retirement Benefits | ||||||
Schedule Of Defined Contribution Plans Disclosures [Line Items] | ||||||
Net benefit obligation | $136 | $120.70 |
Employee_Benefit_Plans_Detail
Employee Benefit Plans (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of Employee Benefit Plans [Line Items] | |||
Total recognized - other comprehensive income | $9.10 | ($29) | ($15.10) |
Pension Plans | |||
Schedule of Employee Benefit Plans [Line Items] | |||
Service cost | 13.2 | 16.3 | 15.2 |
Interest cost | 5 | 4 | 4.1 |
Expected return on assets | -7.7 | -6.7 | -5.9 |
Prior service cost | 0.1 | 0.1 | 0.1 |
Loss (gain) | 0.7 | 1.2 | |
Settlement loss | 2.3 | ||
Net Periodic Benefit Cost | 10.6 | 14.4 | 17 |
Net loss (gain) | 2.1 | -18.4 | -2.1 |
Amortizations | -0.1 | -0.8 | -3.6 |
Total recognized - other comprehensive income | 2 | -19.2 | -5.7 |
Post-retirement Benefits | |||
Schedule of Employee Benefit Plans [Line Items] | |||
Service cost | 2.2 | 3.3 | 3.9 |
Interest cost | 5.9 | 5.8 | 7.2 |
Prior service cost | -3.6 | -3.6 | |
Loss (gain) | -0.7 | ||
Net Periodic Benefit Cost | 3.8 | 5.5 | 11.1 |
Prior service credit | -28.9 | ||
Net loss (gain) | 7.8 | -30.7 | 3.8 |
Amortizations | 4.3 | 3.6 | |
Total recognized - other comprehensive income | $12.10 | ($27.10) | ($25.10) |
WeightedAverage_Actuarial_Assu
Weighted-Average Actuarial Assumptions Used to Determine Net Periodic Benefit Cost (Detail) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Pension Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Discount rate | 4.80% | 3.90% | 4.60% |
Rate of compensation increase (salaried) | 3.00% | 3.00% | 4.00% |
Expected return on assets | 6.80% | 7.00% | 7.00% |
Post-retirement Benefits | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Discount rate | 4.90% | 4.10% | 4.60% |
WeightedAverage_Actuarial_Assu1
Weighted-Average Actuarial Assumptions Used to Determine Benefit Obligations (Detail) | Dec. 31, 2014 | Dec. 31, 2013 |
Pension Plans | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Discount rate | 3.90% | 4.80% |
Rate of compensation increase (salaried) | 3.00% | 3.00% |
Post-retirement Benefits | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Discount rate | 4.00% | 4.90% |
Health_Care_Costs_Trends_Detai
Health Care Costs Trends (Detail) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2014 |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Effect of 1% increase on total of service and interest cost | $1.70 |
Effect of 1% increase on post-retirement benefit obligation | 28.6 |
Effect of 1% decrease on total of service and interest cost | -1.3 |
Effect of 1% decrease on post-retirement benefit obligation | ($22.30) |
Reconciliation_of_Changes_in_N
Reconciliation of Changes in Net Benefit Obligations and Fair Value of Plan Assets (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Benefit Obligations: | |||||
Plan Amendments | ($28.90) | ||||
Actuarial loss (gain) | 17.9 | ||||
Pension Plans | |||||
Benefit Obligations: | |||||
Net benefit obligation at beginning of year | 105.9 | 103.3 | 99.7 | ||
Service cost | 13.2 | 16.3 | 15.2 | ||
Interest cost | 5 | 4 | 4.1 | ||
Settlements | -18.8 | ||||
Benefits paid | -1.5 | -0.8 | -0.4 | ||
Actuarial loss (gain) | 10.9 | -16.9 | 3.5 | ||
Net benefit obligation at end of year | 103.3 | 133.5 | 105.9 | 103.3 | |
Fair Value of Plan Assets: | |||||
Fair value of plan assets at beginning of year | 108.6 | 89.4 | 83.4 | ||
Actual return on plan assets | 16.4 | 8.2 | 11.5 | ||
Employer contributions | 11.8 | 11.8 | 13.7 | ||
Settlements | -18.8 | ||||
Benefits paid | -1.5 | -0.8 | -0.4 | ||
Fair value of plan assets at end of year | 89.4 | 135.3 | 108.6 | 89.4 | |
Net Funded Status | -13.9 | 1.8 | 2.7 | -13.9 | |
Post-retirement Benefits | |||||
Benefit Obligations: | |||||
Net benefit obligation at beginning of year | 120.7 | 142.6 | 156.6 | ||
Service cost | 2.2 | 3.3 | 3.9 | ||
Interest cost | 5.9 | 5.8 | 7.2 | ||
Plan Amendments | -28.9 | ||||
Benefits paid | -0.6 | -0.3 | |||
Actuarial loss (gain) | 7.8 | -30.7 | 3.8 | ||
Net benefit obligation at end of year | 142.6 | 136 | 120.7 | 142.6 | |
Fair Value of Plan Assets: | |||||
Employer contributions | 0.6 | 0.3 | |||
Benefits paid | -0.6 | -0.3 | |||
Net Funded Status | ($142.60) | ($136) | ($120.70) | ($142.60) |
Fair_Value_of_Plan_Assets_by_A
Fair Value of Plan Assets by Asset Category (Detail) (Quoted Prices in Active Markets for Identical Assets (Level 1), USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Fair Value of Plan Assets | $135.30 | $108.60 |
Percentage of plan assets | 100.00% | 100.00% |
Cash and Cash Equivalents | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Fair Value of Plan Assets | 8.6 | 3.6 |
Percentage of plan assets | 6.00% | 3.00% |
Diversified equity Securities | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Fair Value of Plan Assets | 57.8 | 51.5 |
Percentage of plan assets | 43.00% | 48.00% |
Diversified debt Securities | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Fair Value of Plan Assets | $68.90 | $53.50 |
Percentage of plan assets | 51.00% | 49.00% |
Plan_Asset_Allocation_Detail
Plan Asset Allocation (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
Hourly Plan | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Target allocation | 100.00% |
Hourly Plan | Cash and Cash Equivalents | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Target allocation | 5.00% |
Hourly Plan | Diversified equity Securities | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Target allocation | 39.00% |
Hourly Plan | Diversified debt Securities | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Target allocation | 56.00% |
Salary Plan | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Target allocation | 100.00% |
Salary Plan | Cash and Cash Equivalents | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Target allocation | 8.00% |
Salary Plan | Diversified equity Securities | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Target allocation | 46.00% |
Salary Plan | Diversified debt Securities | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Target allocation | 46.00% |
Amounts_Recognized_in_Balance_
Amounts Recognized in Balance Sheet and Accumulated Other Comprehensive Income AOCI (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | |||
Pension Plans | |||
Amounts Recognized in Balance Sheet: | |||
Noncurrent assets | $7.90 | $7.40 | |
Noncurrent liabilities | -6.1 | -4.7 | |
Total asset (liability) | 1.8 | 2.7 | -13.9 |
Accumulated Other Comprehensive Loss: | |||
Prior service (cost) credit | -0.1 | -0.2 | |
Actuarial gain | 0.6 | 2.7 | |
Total | 0.5 | 2.5 | |
Post-retirement Benefits | |||
Amounts Recognized in Balance Sheet: | |||
Current liabilities | -1.2 | -1.4 | |
Noncurrent liabilities | -134.8 | -119.3 | |
Total asset (liability) | -136 | -120.7 | -142.6 |
Accumulated Other Comprehensive Loss: | |||
Prior service (cost) credit | 21.7 | 25.4 | |
Actuarial gain | 8.6 | 17.1 | |
Total | $30.30 | $42.50 |
Amounts_in_Accumulated_Other_C
Amounts in Accumulated Other Comprehensive Income AOCI Expected to be Amortized and Recognized as Component of Net Periodic Benefit Cost in Two Thousand Thirteen (Detail) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2014 |
Pension Plans | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Prior service (cost) credit | ($1) |
Actuarial loss | 1 |
Total | 0 |
Post-retirement Benefits | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Prior service (cost) credit | 3.6 |
Total | $3.60 |
Projected_and_Accumulated_Bene
Projected and Accumulated Benefit Obligation and Fair Value of Plan Assets for Pension Plans with Projected Benefit Obligation in Excess of Plan Assets (Detail) (Salary Plan, USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Salary Plan | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Projected benefit obligation | $71.40 | $53.80 |
Fair value of plan assets | 65.3 | 49.1 |
Accumulated benefit obligation | 67.6 | 50.9 |
Fair value of plan assets | $65.30 | $49.10 |
Expected_Cash_Flows_for_Pensio
Expected Cash Flows for Pension and Post-Retirement Benefit Plans (Detail) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2014 |
Pension Plans | |
Employer Contributions: | |
2015 expected contributions | $2 |
Expected Benefit Payments: | |
2015 | 2.3 |
2016 | 3 |
2017 | 3.8 |
2018 | 4.6 |
2019 | 5.5 |
2020-2024 | 40.6 |
Post-retirement Benefits | |
Employer Contributions: | |
2015 expected contributions | 1.2 |
Expected Benefit Payments: | |
2015 | 1.2 |
2016 | 1.7 |
2017 | 2.4 |
2018 | 3.2 |
2019 | 3.9 |
2020-2024 | $27.70 |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 24, 2012 | Mar. 31, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Aggregate number of shares of common stock available for issuance under the 2011 Plan | 15,300,000 | |||||
Common stock conversion ratio for each RSU upon vesting | 1 | |||||
Unrecognized compensation cost, expected period for recognition | 2 years | |||||
Incentive compensation expense | $3.30 | $1.70 | $5.50 | |||
Taxes paid related to net share settlement of equity awards | 8.4 | 3.6 | ||||
Option expiration period | 10 years | |||||
Dividend per-share | $0.15 | $0.51 | $0.42 | $0.18 | ||
Weighted-average grant-date fair value of options granted | $9.51 | $9.76 | $0 | |||
Total fair value of stock options vested | 0 | 0.7 | 7.5 | |||
Total intrinsic value of stock options exercised | 82.3 | 58 | 24.6 | |||
Aggregate intrinsic value of stock options outstanding | 80.4 | 80.4 | 106.8 | |||
Aggregate intrinsic value of stock options exercisable | 72.5 | 72.5 | 103.8 | |||
Unrecognized compensation cost related to non-vested share-based compensation arrangements | 4.8 | 4.8 | 4.2 | 0.5 | ||
For reason other than death or disability | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Period following optionees' termination options cease to be exercisable | 90 days | |||||
Termination for retirement after the age of 65 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Period following optionees' termination options cease to be exercisable | 3 years | |||||
Termination Due To Death | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Period following optionees' termination options cease to be exercisable | 12 months | |||||
Employee Stock Option | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Option vesting percentage on each anniversary of grant date | 100.00% | 100.00% | ||||
Option Vesting period | 2 years | |||||
Employee Stock Option | Minimum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Option vesting percentage on each anniversary of grant date | 20.00% | 20.00% | ||||
Option Vesting period | 3 years | |||||
Employee Stock Option | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Option vesting percentage on each anniversary of grant date | 33.00% | 33.00% | ||||
Option Vesting period | 5 years | |||||
Restricted Stock Units (RSUs) | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost | 3 | 3 | 10.4 | |||
Unrecognized compensation cost, expected period for recognition | 2 years | |||||
Incentive compensation expense | 9.8 | 12 | 0.9 | |||
Total fair value of RSUs vested | 20.2 | 9 | 0 | |||
Number of shares paying for withholding taxes | 300,000 | 100,000 | ||||
Taxes paid related to net share settlement of equity awards | 8.4 | 3.6 | ||||
Restricted Stock Units (RSUs) | Vesting Schedule One | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock awards, vesting term | 1 year | |||||
Restricted Stock Units (RSUs) | Vesting Schedule Two | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock awards, vesting term | 2 years | |||||
Restricted Stock Units (RSUs) | Vesting Schedule Three | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock awards, vesting term | 3 years | |||||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost | 3.4 | 3.4 | ||||
Unrecognized compensation cost, expected period for recognition | 2 years | |||||
Incentive compensation expense | $1.60 | |||||
Restricted Stock | Vesting Schedule One | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock awards, vesting term | 1 year | |||||
Restricted Stock | Vesting Schedule Two | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock awards, vesting term | 2 years | |||||
Restricted Stock | Vesting Schedule Three | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock awards, vesting term | 3 years |
Summary_of_RSU_Activity_Detail
Summary of RSU Activity (Detail) (Restricted Stock Units (RSUs), USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Restricted Stock Units (RSUs) | |||
Non-vested RSUs: | |||
Beginning balance | 0.8 | 1 | |
Granted | 0 | 0.2 | 1 |
Vested | -0.6 | -0.4 | |
Forfeited | 0 | 0 | 0 |
Ending balance | 0.2 | 0.8 | 1 |
Weighted-Average Grant-Date Fair Value | |||
Beginning balance | $20.90 | $20.20 | |
Granted | $29.85 | $23.31 | $20.20 |
Vested | $20.32 | $20.23 | |
Forfeited | $0 | $0 | $0 |
Ending balance | $26.57 | $20.90 | $20.20 |
Summary_of_Restricted_Stock_Ac
Summary of Restricted Stock Activity (Detail) (Restricted Stock, USD $) | 12 Months Ended |
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 |
Restricted Stock | |
Non-vested Shares: | |
Granted | 0.2 |
Vested | 0 |
Forfeited | 0 |
Ending balance | 0.2 |
Weighted-Average Grant-Date Fair Value | |
Granted | $29.47 |
Vested | $0 |
Forfeited | $0 |
Ending balance | $29.47 |
Assumptions_Used_to_Calculate_
Assumptions Used to Calculate Fair Value of Options (Detail) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 38.00% | 51.00% | |
Expected dividend yield | 1.60% | 1.20% | |
Expected term (in years) | 5 years 6 months | 5 years 4 months 24 days | 0 years |
Expected forfeitures | 0.00% | 0.00% | |
Risk-free rate | 1.70% | 1.60% |
Option_Activity_Detail
Option Activity (Detail) (USD $) | 12 Months Ended | |||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Options | ||||
Outstanding stock options, beginning balance | 8.7 | 11.9 | 14.9 | |
Granted | 0.4 | 0.6 | ||
Exercised | -4.2 | -3.8 | -2.7 | |
Forfeited or expired | -0.3 | |||
Outstanding stock options, ending balance | 4.9 | 8.7 | 11.9 | 14.9 |
Exercisable stock options | 3.9 | 8.1 | 11.8 | 11.5 |
Weighted-Average Exercise | ||||
Outstanding stock options | $15.33 | $14.01 | $13.40 | |
Granted | $30.23 | $23.39 | ||
Exercised | $0 | $0 | $0 | |
Forfeited or expired | $0 | $0 | $0 | |
Outstanding stock options | $17.49 | $15.33 | $14.01 | $13.40 |
Exercisable stock options | $15.32 | $14.79 | $14.02 | $13.37 |
Weighted-Average Remaining | ||||
Outstanding stock options | 4 years 2 months 9 days | 4 years 3 months 18 days | 4 years 11 months 5 days | 4 years 11 months 9 days |
Exercisable stock options | 3 years 29 days | 3 years 11 months 9 days | 4 years 10 months 28 days | 4 years 10 months 17 days |
NonVested_Shares_Activity_Deta
Non-Vested Shares Activity (Detail) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Non-vested Stock Options: | |||
Beginning Balance | 0.6 | 0.2 | 3.4 |
Granted | 0.4 | 0.6 | |
Vested | -0.2 | -2.9 | |
Forfeited | -0.3 | ||
Ending Balance | 1 | 0.6 | 0.2 |
Weighted-Average Grant-Date | |||
Beginning Balance | $9.06 | $4.34 | $2.81 |
Granted | $9.51 | $9.76 | |
Vested | $3.59 | $2.58 | |
Forfeited | $4 | ||
Ending Balance | $9.44 | $9.06 | $4.34 |
Income_Before_Income_Taxes_Det
Income Before Income Taxes (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of Components of Income Before Income Tax Expense (Benefit) [Line Items] | |||
U.S. income | $355.10 | $259 | $204.10 |
Foreign income | 13 | 7.1 | 12.1 |
Total | $368.10 | $266.10 | $216.20 |
Provision_for_Income_Tax_Expen
Provision for Income Tax Expense (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Estimated current income taxes: | |||
U.S. federal | $1.60 | $0.20 | $1.50 |
Foreign | 6.3 | 1.9 | 3.9 |
U.S. state and local | -0.2 | 0.6 | 0.4 |
Total Current | 7.7 | 2.7 | 5.8 |
Deferred income tax expense (credit), net: | |||
U.S. federal | 125.6 | 87.6 | -282.5 |
Foreign | -0.3 | 0.1 | 0.1 |
U.S. state and local | 6.5 | 10.3 | -21.4 |
Total Deferred | 131.8 | 98 | -303.8 |
Total income tax expense (benefit) | $139.50 | $100.70 | ($298) |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Taxes [Line Items] | |||
Income taxes paid | $5 | $3.80 | $10.70 |
Net operating loss carryforwards, federal | 91.00% | ||
Net operating loss carryforwards, state | 9.00% | ||
Operating loss carryforwards | 253.3 | ||
Valuation allowances | $5.20 | $2.80 | |
Minimum | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards, expiration year | 2027 | ||
Maximum | |||
Income Taxes [Line Items] | |||
Net operating loss carryforwards, expiration year | 2032 |
Reconciliation_of_Provision_fo
Reconciliation of Provision for Income Tax Expense (Benefit) (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Reconciliation of Provision of Income Taxes [Line Items] | |||
Tax at U.S. statutory income tax rate | $128.90 | $93.10 | $75.70 |
Foreign rate differential | -2.3 | -0.7 | -2.6 |
Non-deductible expenses | 3.9 | 0.8 | 4.2 |
Valuation allowance | 2.6 | 1 | -384.1 |
State tax expense | 4 | 7.3 | 5.7 |
Adjustment to deferred tax expense | 2.4 | -0.3 | 2.2 |
Other adjustments | 0 | -0.5 | 0.9 |
Total income tax expense (benefit) | $139.50 | $100.70 | ($298) |
Deferred_Tax_Assets_and_Liabil
Deferred Tax Assets and Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Deferred tax assets: | ||
Inventories | $5.10 | $4.60 |
Warranty accrual | 30.5 | 32.7 |
Sales allowances and rebates | 6.7 | 7.9 |
Deferred revenue | 25.7 | 24 |
Post-retirement health care | 5.7 | |
Intangibles | 77.3 | 83.6 |
Other accrued liabilities | 32.7 | 27.2 |
Unrealized loss on interest rate derivatives | 5.7 | 3.7 |
Operating loss carryforwards | 107.8 | 140.7 |
Stock based compensation | 6.9 | 12.5 |
Technology-related investments | 6.6 | 6.8 |
Loan fees | 0.9 | |
Other | 16.4 | 10.4 |
Total Deferred tax assets | 327.1 | 355 |
Valuation allowances | -5.2 | -2.8 |
Deferred tax liabilities: | ||
Property, plant and equipment | -20.2 | -22 |
Goodwill | -320.8 | -280.3 |
Product warranty liabilities | -4.3 | -5.6 |
Pension | -0.5 | |
Post-retirement health care | -0.2 | |
Other | -3.5 | |
Total Deferred tax liabilities | -439.1 | -369.2 |
Net Deferred tax liability | -117.2 | -17 |
Trade Name | ||
Deferred tax liabilities: | ||
Trade name | ($90.30) | ($60.60) |
Liability_for_Unrecognized_Tax
Liability for Unrecognized Tax Benefit (Detail) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2014 |
Income Tax Contingency [Line Items] | |
Unrecognized Tax Benefits, Beginning Balance | $2.30 |
Increases in unrecognized tax benefits as a result of current year activity | 0.2 |
Unrecognized Tax Benefits, Ending Balance | $2.50 |
Changes_in_Components_of_Accum
Changes in Components of Accumulated Other Comprehensive Loss (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Comprehensive Income (Loss) [Line Items] | |||
Beginning balance | $30.30 | ($9.20) | ($33.20) |
Foreign currency translation, before tax | -7.4 | -5 | -0.7 |
Pension and OPEB liability adjustment, before tax | -14.6 | 46.4 | 26.7 |
Available-for-sale securities, before tax | -3.2 | -1.9 | -2 |
Net current period other comprehensive income (loss) | -25.2 | 39.5 | 24 |
Ending balance | 5.1 | 30.3 | -9.2 |
Beginning balance | -51.3 | -34.7 | -23.8 |
Foreign currency translation, tax expense | 0 | 0 | 0 |
Pension and OPEB liability adjustment, tax expense | 5.5 | -17.4 | -11.6 |
Available-for-sale securities, tax expense | 1.2 | 0.8 | 0.7 |
Net current period other comprehensive income (loss) | 6.7 | -16.6 | -10.9 |
Ending balance | -44.6 | -51.3 | -34.7 |
Beginning Balance | -21 | -43.9 | -57 |
Foreign currency translation, after tax | -7.4 | -5 | -0.7 |
Pension and OPEB liability adjustment, after tax | -9.1 | 29 | 15.1 |
Available-for-sale securities, after tax | -2 | -1.1 | -1.3 |
Total other comprehensive (loss) income, net of tax | -18.5 | 22.9 | 13.1 |
Ending balance | ($39.50) | ($21) | ($43.90) |
Consolidated_Statement_of_Comp
Consolidated Statement of Comprehensive Income Affected by Reclassification from AOCL (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Cost of sales | ($1,151.50) | ($1,084.90) | ($1,187.50) | ||||||||
Selling, general and administrative expenses | -344.6 | -334.9 | -419 | ||||||||
Engineering - research and development | -103.8 | -97.1 | -115.1 | ||||||||
Income before income taxes | 77.8 | 116.3 | 94.7 | 79.3 | 67.5 | 72.4 | 81.8 | 44.4 | 368.1 | 266.1 | 216.2 |
Income tax (expense) benefit | -139.5 | -100.7 | 298 | ||||||||
Total reclassifications | 50.5 | 68.8 | 57.2 | 52.1 | 42.9 | 44.5 | 50.5 | 27.5 | 228.6 | 165.4 | 514.2 |
Reclassified from AOCL | Prior service cost | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Cost of sales | 3.2 | ||||||||||
Selling, general and administrative expenses | 0.3 | ||||||||||
Engineering - research and development | 0.1 | ||||||||||
Reclassified from AOCL | Actuarial loss | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Cost of sales | 0.7 | ||||||||||
Selling, general and administrative expenses | 0 | ||||||||||
Engineering - research and development | 0 | ||||||||||
Reclassified from AOCL | Accumulated Defined Benefit Plans Adjustment | |||||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||||
Income before income taxes | 4.3 | ||||||||||
Income tax (expense) benefit | -1.6 | ||||||||||
Total reclassifications | $2.70 |
Recovered_Sheet3
Commitments and Contingencies - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Commitments and Contingencies Disclosure [Line Items] | |||
Rent expense | $5.40 | $5.70 | $5.50 |
Future_Payments_under_NonCance
Future Payments under Non-Cancelable Operating Leases (Detail) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Operating Leased Assets [Line Items] | |
2015 | $4.60 |
2016 | 2.8 |
2017 | 1.7 |
2018 | 0.8 |
2019 | 0.6 |
Thereafter | 2 |
Total | $12.50 |
Concentration_of_Risk_Addition
Concentration of Risk - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Employee | Customer | |||
Concentration Risk [Line Items] | ||||
Number of employees | 2,700 | 2,700 | ||
Collective bargaining agreement, expiration date | 2017-11 | 2017-11 | ||
Employees in the U.S | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 90.00% | 90.00% | ||
Unionized employees subject to collective bargaining agreement | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 60.00% | 60.00% | ||
Sales Revenue, Goods, Net | ||||
Concentration Risk [Line Items] | ||||
Number of significant customers | 3 | 3 | 3 | 3 |
Accounts Receivable | ||||
Concentration Risk [Line Items] | ||||
Number of significant customers | 3 | 3 | ||
Supplier Concentration Risk | ||||
Concentration Risk [Line Items] | ||||
Number of significant suppliers | 1 | 1 | 1 |
Customers_Accounted_for_Greate
Customers Accounted for Greater Than Ten Percent of Net Sales (Detail) (Sales Revenue, Goods, Net) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Daimler AG | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 17.00% | 17.00% | 13.00% |
Navistar Inc | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 10.00% | 10.00% | 11.00% |
Oshkosh Corporation | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 4.00% | 8.00% | 11.00% |
Customers_Accounted_for_Greate1
Customers Accounted for Greater Than Ten Percent of Accounts Receivable (Detail) (Accounts Receivable) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Daimler AG | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 15.00% | 15.00% |
A B Volvo | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 8.00% | 11.00% |
Navistar Inc | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 12.00% | 10.00% |
Supplier_Accounted_for_Greater
Supplier Accounted for Greater Than Ten Percent of Materials Purchased (Detail) (Supplier Concentration Risk, Linamar Corporation Inc.) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Supplier Concentration Risk | Linamar Corporation Inc. | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 10.00% | 13.00% | 13.00% |
Recovered_Sheet4
Certain Relationships and Related Party Transactions - Additional Information (Detail) (USD $) | 12 Months Ended | 1 Months Ended | 12 Months Ended | |
Dec. 31, 2014 | Jun. 30, 2014 | Feb. 28, 2014 | Dec. 31, 2013 | |
Fixed 7.125% Senior Notes | ||||
Related Party Transaction [Line Items] | ||||
Senior Notes, stated interest rate | 7.13% | |||
Secondary Public Offering in September | ||||
Related Party Transaction [Line Items] | ||||
Secondary offering of common stock | 5,392,499 | |||
Common stock, price per share | $30.46 | |||
Secondary Public Offering in June | ||||
Related Party Transaction [Line Items] | ||||
Secondary offering of common stock | 40,250,000 | |||
Common stock, price per share | $29.95 | |||
Secondary Public Offering in April | ||||
Related Party Transaction [Line Items] | ||||
Secondary offering of common stock | 25,000,000 | |||
Common stock, price per share | $29.78 | |||
Secondary Public Offering in February | ||||
Related Party Transaction [Line Items] | ||||
Secondary offering of common stock | 28,750,000 | |||
Common stock, price per share | $29.17 | |||
Secondary Public Offering | ||||
Related Party Transaction [Line Items] | ||||
Stock repurchased from underwriter | 5,000,000 | 3,428,179 | ||
Secondary Public Offering in August | ||||
Related Party Transaction [Line Items] | ||||
Secondary offering of common stock | 23,805,000 | |||
Common stock, price per share | $21.18 | |||
Stock repurchased from underwriter | 4,700,000 | |||
Secondary Public Offering in November | ||||
Related Party Transaction [Line Items] | ||||
Secondary offering of common stock | 15,000,000 | |||
Common stock, price per share | $23.10 | |||
Secondary Public Offering in December | ||||
Related Party Transaction [Line Items] | ||||
Secondary offering of common stock | 12,500,000 | |||
Common stock, price per share | $25.56 | |||
Lawrence E. Dewey | Fixed 7.125% Senior Notes | ||||
Related Party Transaction [Line Items] | ||||
Senior notes held by executive officers | $100,000 | |||
David S. Graziosi | Fixed 7.125% Senior Notes | ||||
Related Party Transaction [Line Items] | ||||
Senior notes held by executive officers | $450,000 |
Common_Stock_Additional_Inform
Common Stock - Additional Information (Detail) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Common Stock Disclosure [Line Items] | |
Common stock, repurchases authorized | $500 |
Common stock, remained available for stock repurchases | $500 |
Earnings_Per_Share_Additional_
Earnings Per Share - Additional Information (Detail) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2014 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |
Anti-dilutive stock options not included in the diluted EPS computation | 0 |
Reconciliation_of_Numerators_a
Reconciliation of Numerators and Denominators Used to Calculate Basic EPS and Diluted EPS (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Computation of Earnings Per Share [Line Items] | |||||||||||
Net income | $50.50 | $68.80 | $57.20 | $52.10 | $42.90 | $44.50 | $50.50 | $27.50 | $228.60 | $165.40 | $514.20 |
Weighted average shares of common stock outstanding | 179.8 | 184.5 | 182 | ||||||||
Dilutive effect stock-based awards | 2.5 | 3.4 | 4.2 | ||||||||
Diluted weighted average shares of common stock outstanding | 182.3 | 187.9 | 186.2 | ||||||||
Basic earnings per share attributable to common stockholders | $0.28 | $0.38 | $0.32 | $0.29 | $0.24 | $0.24 | $0.27 | $0.15 | $1.27 | $0.90 | $2.83 |
Diluted earnings per share attributable to common stockholders | $0.28 | $0.38 | $0.31 | $0.28 | $0.23 | $0.24 | $0.26 | $0.15 | $1.25 | $0.88 | $2.76 |
Net_Sales_by_Country_Detail
Net Sales by Country (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | $544.40 | $553.30 | $536.10 | $493.60 | $491 | $466.30 | $512.10 | $457.40 | $2,127.40 | $1,926.80 | $2,141.80 |
UNITED STATES | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | 1,578 | 1,354.30 | 1,509.60 | ||||||||
CHINA | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | 128.7 | 141 | 136.4 | ||||||||
CANADA | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | 85.1 | 88.6 | 123 | ||||||||
JAPAN | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | 45.8 | 37 | 52 | ||||||||
GERMANY | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | 38.1 | 53.9 | 39.1 | ||||||||
UNITED KINGDOM | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | 36.8 | 42.5 | 74.1 | ||||||||
Other Countries | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Total net sales | $214.90 | $209.50 | $207.60 |
Net_LongLived_Assets_by_Countr
Net Long-Lived Assets by Country (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, net | $514.60 | $563.40 | $596.20 |
UNITED STATES | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, net | 442.6 | 478.7 | 493.6 |
INDIA | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, net | 51.5 | 59.9 | 76.8 |
HUNGARY | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, net | 15.1 | 18.1 | 18.4 |
Other Countries | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, net | $5.40 | $6.70 | $7.40 |
Recovered_Sheet5
Quarterly Financial Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Quarterly Financial Information [Line Items] | |||||||||||
Net sales | $544.40 | $553.30 | $536.10 | $493.60 | $491 | $466.30 | $512.10 | $457.40 | $2,127.40 | $1,926.80 | $2,141.80 |
Gross profit | 255.6 | 259.3 | 238.5 | 222.5 | 211.4 | 206.1 | 226.1 | 198.3 | 975.9 | 841.9 | 954.3 |
Operating income | 117.8 | 147.3 | 132.2 | 114.8 | 99.6 | 111.2 | 117.7 | 81.4 | 512.1 | 409.9 | 420.2 |
Income before income taxes | 77.8 | 116.3 | 94.7 | 79.3 | 67.5 | 72.4 | 81.8 | 44.4 | 368.1 | 266.1 | 216.2 |
Net income | $50.50 | $68.80 | $57.20 | $52.10 | $42.90 | $44.50 | $50.50 | $27.50 | $228.60 | $165.40 | $514.20 |
Basic earnings per share | $0.28 | $0.38 | $0.32 | $0.29 | $0.24 | $0.24 | $0.27 | $0.15 | $1.27 | $0.90 | $2.83 |
Diluted earnings per share | $0.28 | $0.38 | $0.31 | $0.28 | $0.23 | $0.24 | $0.26 | $0.15 | $1.25 | $0.88 | $2.76 |
Schedule_I_Parent_Company_Only
Schedule I Parent Company Only Balance Sheets (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Millions, unless otherwise specified | ||||
Current Assets: | ||||
Cash | $263 | $184.70 | $80.20 | $314 |
Total Current Assets | 758 | 606.9 | ||
TOTAL ASSETS | 4,804.20 | 4,812.60 | ||
Current Liabilities: | ||||
Accounts payable | 151.7 | 150.4 | ||
Total Current Liabilities | 345.9 | 387.2 | ||
Capital stock | 1,397.80 | 1,438.80 | 1,356.90 | 821.7 |
Additional paid-in-capital | 1,651 | 1,631.80 | ||
Accumulated deficit | -215.5 | -173.8 | ||
Accumulated other comprehensive loss, net of tax | -39.5 | -21 | -43.9 | -57 |
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | 4,804.20 | 4,812.60 | ||
Parent Company | ||||
Current Assets: | ||||
Cash | 0 | 0 | 0 | 0 |
Total Current Assets | 0 | 0 | ||
Investments in and advances to subsidiaries | 1,397.80 | 1,438.80 | ||
TOTAL ASSETS | 1,397.80 | 1,438.80 | ||
Current Liabilities: | ||||
Accounts payable | 0 | 0 | ||
Total Current Liabilities | 0 | 0 | ||
Capital stock | 1.8 | 1.8 | ||
Additional paid-in-capital | 1,651 | 1,631.80 | ||
Treasury stock | 0 | 0 | ||
Accumulated deficit | -215.5 | -173.8 | ||
Accumulated other comprehensive loss, net of tax | -39.5 | -21 | ||
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY | $1,397.80 | $1,438.80 |
Schedule_I_Parent_Company_Only1
Schedule I Parent Company Only Statements of Comprehensive Income (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Condensed Financial Statements, Captions [Line Items] | |||||||||||
Net sales | $544.40 | $553.30 | $536.10 | $493.60 | $491 | $466.30 | $512.10 | $457.40 | $2,127.40 | $1,926.80 | $2,141.80 |
Operating income | 117.8 | 147.3 | 132.2 | 114.8 | 99.6 | 111.2 | 117.7 | 81.4 | 512.1 | 409.9 | 420.2 |
Other income: | |||||||||||
Income before income taxes | 77.8 | 116.3 | 94.7 | 79.3 | 67.5 | 72.4 | 81.8 | 44.4 | 368.1 | 266.1 | 216.2 |
Income tax expense | -139.5 | -100.7 | 298 | ||||||||
Net income | 50.5 | 68.8 | 57.2 | 52.1 | 42.9 | 44.5 | 50.5 | 27.5 | 228.6 | 165.4 | 514.2 |
Comprehensive income | 210.1 | 188.3 | 527.3 | ||||||||
Parent Company | |||||||||||
Condensed Financial Statements, Captions [Line Items] | |||||||||||
Net sales | 0 | 0 | 0 | ||||||||
General and administrative fees | 0 | 0 | 0 | ||||||||
Operating income | 0 | 0 | 0 | ||||||||
Other income: | |||||||||||
Equity earnings of consolidated subsidiary | 228.6 | 165.4 | 514.2 | ||||||||
Income before income taxes | 228.6 | 165.4 | 514.2 | ||||||||
Income tax expense | 0 | 0 | 0 | ||||||||
Net income | 228.6 | 165.4 | 514.2 | ||||||||
Comprehensive income | $228.60 | $165.40 | $514.20 |
Recovered_Sheet6
Schedule I Parent Company only Statements of Cash Flows (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | $228.60 | $165.40 | $514.20 |
Deduct items included in net income not providing cash: | |||
Net cash provided by operating activities | 556.9 | 453.5 | 497.5 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Net cash used for investing activities | -67.9 | -81.5 | -138.7 |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Dividends | -91.6 | -77.1 | -32.8 |
Net cash used for financing activities | -424.1 | -277.5 | -593.5 |
Net increase (decrease) during period | 78.3 | 104.5 | -233.8 |
Cash and cash equivalents at beginning of period | 184.7 | 80.2 | 314 |
Cash and cash equivalents at end of period | 263 | 184.7 | 80.2 |
Parent Company | |||
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net income | 228.6 | 165.4 | 514.2 |
Deduct items included in net income not providing cash: | |||
Equity in earnings in consolidated subsidiary | -228.6 | -165.4 | -514.2 |
Net cash provided by operating activities | 0 | 0 | 0 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Investments in subsidiaries | -59.6 | -46.3 | -29 |
Dividends | 91.6 | 77.1 | 32.8 |
Net cash used for investing activities | 32 | 30.8 | 3.8 |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Capital contributions | 59.6 | 46.3 | 29 |
Dividends | -91.6 | -77.1 | -32.8 |
Net cash used for financing activities | -32 | -30.8 | -3.8 |
Net increase (decrease) during period | 0 | 0 | 0 |
Cash and cash equivalents at beginning of period | 0 | 0 | 0 |
Cash and cash equivalents at end of period | $0 | $0 | $0 |