Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 07, 2020 | Jun. 28, 2019 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Fortune Brands Home & Security, Inc. | ||
Entity Central Index Key | 0001519751 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Interactive Data Current | Yes | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Public Float | $ 7,953,512,286 | ||
Entity Common Stock, Shares Outstanding | 139,971,698 | ||
Entity Shell Company | false | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Trading Symbol | FBHS | ||
Security Exchange Name | NYSE | ||
Entity File Number | 1-35166 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 62-1411546 | ||
Entity Address, Address Line One | 520 Lake Cook Road | ||
Entity Address, City or Town | Deerfield | ||
Entity Address, State or Province | IL | ||
Entity Address, Postal Zip Code | 60015-5611 | ||
City Area Code | 847 | ||
Local Phone Number | 484-4400 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Documents Incorporated by Reference | Certain information contained in the registrant’s proxy statement for its Annual Meeting of Stockholders to be held on April 28, |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Income Statement [Abstract] | ||||
NET SALES | $ 5,764.6 | $ 5,485.1 | $ 5,283.3 | |
Cost of products sold | 3,712.2 | 3,525.7 | 3,358.3 | |
Selling, general and administrative expenses | 1,256.3 | 1,241.4 | 1,196.9 | |
Amortization of intangible assets | 41.4 | 36.1 | 31.7 | |
Loss on sale of product line (see Note 4) | 2.4 | |||
Asset impairment charges | 41.5 | 62.6 | 3.2 | |
Restructuring charges | 14.7 | 24.1 | 8.3 | |
OPERATING INCOME | 698.5 | 595.2 | 682.5 | |
Interest expense | 94.2 | 74.5 | 49.4 | |
Other expense (income), net | 29 | (16.3) | (1.7) | |
Income from continuing operations before income taxes | 575.3 | 537 | 634.8 | |
Income taxes | 144 | 147 | 159.5 | |
Income from continuing operations, net of tax | 431.3 | 390 | 475.3 | |
Loss from discontinued operations, net of tax | (0.2) | (2.6) | ||
NET INCOME | 431.3 | 389.8 | 472.7 | |
Less: Noncontrolling interests | (0.6) | 0.2 | 0.1 | |
NET INCOME ATTRIBUTABLE TO FORTUNE BRANDS | $ 431.9 | $ 389.6 | $ 472.6 | |
BASIC EARNINGS (LOSS) PER COMMON SHARE | ||||
Continuing operations | $ 3.09 | $ 2.69 | $ 3.10 | |
Discontinuing operations | (0.02) | |||
Net income attributable to Fortune Brands common shareholders | 3.09 | 2.69 | 3.08 | |
DILUTED EARNINGS (LOSS) PER COMMON SHARE | ||||
Continuing operations | 3.06 | 2.66 | 3.05 | |
Discontinuing operations | (0.02) | |||
Net income attributable to Fortune Brands common shareholders | $ 3.06 | $ 2.66 | $ 3.03 | |
Basic average number of shares outstanding | [1] | 139.9 | 144.6 | 153.2 |
Diluted average number of shares outstanding | [1] | 141.3 | 146.4 | 155.8 |
[1] | Reflects the impact of share repurchases during the years ended December 31, 2019, 2018 and 2017, respectively. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Statement Of Income And Comprehensive Income [Abstract] | ||||
NET INCOME | $ 431.3 | $ 389.8 | $ 472.7 | |
Other comprehensive (loss) income, before tax: | ||||
Foreign currency translation adjustments | 13.8 | (31.1) | 33.8 | |
Unrealized gains (losses) on derivatives: | ||||
Unrealized holding gains (losses) arising during period | 4.8 | 10.1 | (1.8) | |
Less: reclassification adjustment for gains included in net income | (4.4) | (2.1) | (0.9) | |
Unrealized gains (losses) on derivatives | 0.4 | 8 | (2.7) | |
Defined benefit plans: | ||||
Net actuarial (loss) gains arising during period | (15.9) | (4.2) | 6.2 | |
Less: amortization of prior service credit included in net periodic pension cost | (5.1) | |||
Defined benefit plans | (15.9) | (4.2) | 1.1 | |
Other comprehensive (loss) income, before tax | (1.7) | (27.3) | 32.2 | |
Income tax benefit (expense) related to items of other comprehensive income | [1] | 4.7 | (0.5) | 0.5 |
Other comprehensive income (loss), net of tax | 3 | (27.8) | 32.7 | |
COMPREHENSIVE INCOME | 434.3 | 362 | 505.4 | |
Less: comprehensive income attributable to noncontrolling interest | (0.6) | 0.2 | ||
COMPREHENSIVE INCOME ATTRIBUTABLE TO FORTUNE BRANDS | $ 434.9 | $ 361.8 | $ 505.4 | |
[1] |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Unrealized (losses) gains on derivatives, tax | $ 0.9 | $ (1.4) | $ 0.9 |
Defined benefit plans, tax | $ 3.8 | $ 0.9 | $ (0.4) |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | |
Current assets | |||
Cash and cash equivalents | $ 387.9 | $ 262.9 | |
Accounts receivable less allowances for discounts and doubtful accounts | 624.8 | 571.7 | |
Inventories | 718.6 | 678.9 | |
Other current assets | 166.9 | 172.6 | |
TOTAL CURRENT ASSETS | 1,898.2 | 1,686.1 | |
Property, plant and equipment, net of accumulated depreciation | 824.2 | 813.4 | |
Operating lease assets | 165.6 | ||
Goodwill | [1] | 2,090.2 | 2,080.3 |
Other intangible assets, net of accumulated amortization | 1,168.9 | 1,246.8 | |
Other assets | 144.2 | 138 | |
TOTAL ASSETS | 6,291.3 | 5,964.6 | |
Current liabilities | |||
Short-term debt | 399.7 | 525 | |
Accounts payable | 460 | 459 | |
Other current liabilities | 549.6 | 508.1 | |
TOTAL CURRENT LIABILITIES | 1,409.3 | 1,492.1 | |
Long-term debt | 1,784.6 | 1,809 | |
Deferred income taxes | 157.2 | 162.6 | |
Accrued defined benefit plans | 201.4 | 163.3 | |
Operating lease liabilities | 139.8 | ||
Other non-current liabilities | 171.2 | 157.6 | |
TOTAL LIABILITIES | 3,863.5 | 3,784.6 | |
Commitments (Note 19) and Contingencies (Note 24) | |||
Equity | |||
Common stock | [2] | 1.8 | 1.8 |
Paid-in capital | 2,813.8 | 2,766 | |
Accumulated other comprehensive loss | (72.6) | (67) | |
Retained earnings | 1,763 | 1,448.1 | |
Treasury stock | (2,079.4) | (1,970.7) | |
TOTAL FORTUNE BRANDS EQUITY | 2,426.6 | 2,178.2 | |
Noncontrolling interests | 1.2 | 1.8 | |
TOTAL EQUITY | 2,427.8 | 2,180 | |
TOTAL LIABILITIES AND EQUITY | $ 6,291.3 | $ 5,964.6 | |
[1] | Net of accumulated impairment losses of $399.5 million in the Doors & Security segment. | ||
[2] | Common stock, par value $0.01 per share, 181.9 million shares and 180.6 million shares issued at December 31, 2019 and 2018, respectively. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares issued | 181.9 | 180.6 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
OPERATING ACTIVITIES | ||||
Net income | $ 431.3 | $ 389.8 | $ 472.7 | |
Non-cash expense (income): | ||||
Depreciation | 111.3 | 113.5 | 98.6 | |
Amortization of intangible assets | 41.4 | 36.1 | 31.7 | |
Non-cash lease expense | 35.9 | |||
Stock-based compensation | 30.5 | 36.1 | 43 | |
(Gain) loss on sale of property, plant and equipment | (0.4) | 1.2 | 0.9 | |
Loss on sale of product line | 2.4 | |||
Asset impairment charges | 43.2 | 62.6 | 15.3 | |
Recognition of actuarial losses (gains) | 34.1 | 3.8 | (0.5) | |
Deferred taxes | (7.5) | 2.8 | (18.7) | |
Amortization of deferred financing costs | 3.4 | 2.3 | 2 | |
Changes in assets and liabilities including effects subsequent to acquisitions | ||||
(Increase) decrease in accounts receivable | (50.7) | 9.8 | 1 | |
Increase in inventories | (38.3) | (55) | (24.8) | |
Increase in accounts payable | 8.7 | 21 | 24 | |
Increase in other assets | (10.5) | (24.7) | (28.3) | |
(Decrease) increase in accrued taxes | (5.3) | 9.5 | (24.4) | |
Increase (decrease) in accrued expenses and other liabilities | 10.1 | (4.8) | 5.4 | |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 637.2 | 604 | 600.3 | |
INVESTING ACTIVITIES | ||||
Capital expenditures | [1] | (131.8) | (150.1) | (165) |
Proceeds from the disposition of assets | 4.2 | 6.1 | 0.4 | |
Proceeds from sale of product line | 1.5 | |||
Cost of acquisitions, net of cash acquired | (465.6) | (124.6) | ||
Cost of investments in equity securities | (28.7) | |||
Other investing activities, net | 4 | |||
NET CASH USED IN INVESTING ACTIVITIES | (127.6) | (634.3) | (287.7) | |
FINANCING ACTIVITIES | ||||
(Decrease) increase in short-term debt | (525) | 525 | ||
Issuance of long-term debt | 1,719.3 | 2,191.2 | 640 | |
Repayment of long-term debt | (1,345) | (1,890) | (565) | |
Proceeds from the exercise of stock options | 17.3 | 4.9 | 28.5 | |
Employee withholding taxes paid related to stock-based compensation | (8.7) | (14) | (10.6) | |
Deferred acquisition payments | (19) | (13.1) | (17.9) | |
Dividends to stockholders | (123) | (115.2) | (110.3) | |
Treasury stock purchases | (100) | (694.6) | (214.8) | |
Other financing activities, net | (5.6) | (1) | ||
NET CASH USED IN FINANCING ACTIVITIES | (389.7) | (6.8) | (250.1) | |
Effect of foreign exchange rate changes on cash | 4.3 | (15.2) | 9 | |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 124.2 | (52.3) | 71.5 | |
Cash, cash equivalents and restricted cash at beginning of year | [2] | 270.7 | 323 | 251.5 |
Cash, cash equivalents and restricted cash at end of year | [2] | 394.9 | 270.7 | 323 |
Cash paid during the year for | ||||
Interest | 81 | 63.4 | 44.4 | |
Income taxes paid directly to taxing authorities | 144.5 | 114.2 | 169.7 | |
Dividends declared but not paid | $ 33.5 | $ 30.9 | $ 30.4 | |
[1] | Capital expenditures of $10.0 million, $16.7 million and $17.2 million that have not been paid as of December 31, 2019, 2018 and 2017, respectively, were excluded from the Consolidated Statement of Cash Flows. | |||
[2] | Restricted cash of $0.9 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Capital expenditures incurred but not yet paid | $ 10 | $ 16.7 | $ 17.2 |
Restricted Cash | $ 0 | ||
Other Current Assets [Member] | |||
Restricted Cash | 0.9 | 0.9 | |
Other Assets [Member] | |||
Restricted Cash | $ 6.1 | $ 6.9 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) $ in Millions | Total | Common Stock | Paid-In Capital | Accumulated Other Comprehensive (Loss) Income | Retained Earnings | Treasury Stock | Non- controlling Interests |
Beginning Balance at Dec. 31, 2016 | $ 2,363 | $ 1.7 | $ 2,653.8 | $ (71.9) | $ 814.6 | $ (1,036.7) | $ 1.5 |
Comprehensive income: | |||||||
Net income | 472.7 | 472.6 | 0.1 | ||||
Other comprehensive income (loss) | 32.7 | 32.7 | |||||
Stock options exercised | 28.5 | 28.5 | |||||
Stock-based compensation | 32 | 42.6 | (10.6) | ||||
Treasury stock purchase | (214.8) | (214.8) | |||||
Dividends | (113) | (113) | |||||
Ending Balance at Dec. 31, 2017 | 2,601.1 | 1.7 | 2,724.9 | (39.2) | 1,174.2 | (1,262.1) | 1.6 |
Comprehensive income: | |||||||
Net income | 389.8 | 389.6 | 0.2 | ||||
Other comprehensive income (loss) | (27.8) | (27.8) | |||||
Stock options exercised | 5.1 | 0.1 | 5 | ||||
Stock-based compensation | 22.1 | 36.1 | (14) | ||||
Treasury stock purchase | (694.6) | (694.6) | |||||
Dividends | (115.7) | (115.7) | |||||
Ending Balance at Dec. 31, 2018 | 2,180 | 1.8 | 2,766 | (67) | 1,448.1 | (1,970.7) | 1.8 |
Comprehensive income: | |||||||
Net income | 431.3 | 431.9 | (0.6) | ||||
Other comprehensive income (loss) | 3 | 3 | |||||
Stock options exercised | 17.3 | 17.3 | |||||
Stock-based compensation | 21.8 | 30.5 | (8.7) | ||||
Adoption of ASU 2018-02 | (8.6) | 8.6 | |||||
Treasury stock purchase | (100) | (100) | |||||
Dividends | (125.6) | (125.6) | |||||
Ending Balance at Dec. 31, 2019 | $ 2,427.8 | $ 1.8 | $ 2,813.8 | $ (72.6) | $ 1,763 | $ (2,079.4) | $ 1.2 |
Consolidated Statements of Eq_2
Consolidated Statements of Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement Of Stockholders Equity [Abstract] | |||
Dividends per Common share | $ 0.90 | $ 0.82 | $ 0.74 |
Background and Basis of Present
Background and Basis of Presentation | 12 Months Ended |
Dec. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Background and Basis of Presentation | 1. Background and Basis of Presentation The Company is a leading home and security products company with a portfolio of leading branded products used for residential home repair, remodeling, new construction and security applications. References to “Fortune Brands,” “the Company,” “we,” “our” and “us” refer to Fortune Brands Home & Security, Inc. and its consolidated subsidiaries as a whole, unless the context otherwise requires. Basis of Presentation The consolidated financial statements in this Annual Report on Form 10-K have been derived from the accounts of the Company and its wholly-owned subsidiaries. The Company’s consolidated financial statements are based on a fiscal year ending December 31. Certain of the Company’s subsidiaries operate on a 52 or 53 week fiscal year ending during the month of December. In September 2018, we acquired Fiberon. The financial results of Fiberon were included in the Company’s consolidated statements of income and statements of cash flow beginning in September 2018 and the consolidated balance sheet as of December 31, 2018. The results of operations are included in the Doors & Security segment. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies Use of Estimates The presentation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires us to make estimates and assumptions that affect reported amounts and related disclosures. Actual results in future periods could differ from those estimates. Cash and Cash Equivalents Highly liquid investments with an original maturity of three months or less are included in cash and cash equivalents. Allowances for Doubtful Accounts Trade receivables are recorded at the stated amount, less allowances for discounts and doubtful accounts. The allowances for doubtful accounts represent estimated uncollectible receivables associated with potential customer defaults on contractual obligations (usually due to customers’ potential insolvency) or discounts related to early payment of accounts receivables by our customers. The allowances include provisions for certain customers where a risk of default has been specifically identified. In addition, the allowances include a provision for customer defaults on a general formula basis when it is determined that the risk of some default is probable and estimable, but cannot yet be associated with specific customers. The assessment of the likelihood of customer defaults is based on various factors, including the length of time the receivables are past due, historical collection experience and existing economic conditions. In accordance with this policy, our allowance for doubtful accounts was $3.0 million and $3.7 million as of December 31, 2019 and 2018, respectively. Inventories Inventory provisions are recorded to reduce inventory to the net realizable dollar value for obsolete or slow moving inventory based on assumptions about future demand and marketability of products, the impact of new product introductions, inventory levels and turns, product spoilage and specific identification of items, such as product discontinuance, engineering/material changes, or regulatory-related changes. During the fourth quarter of 2018, we determined that it was preferable to change our accounting policy from last-in, first-out (“LIFO”) to FIFO for product groups in which metals comprise a significant portion of inventory cost. We believe this change is preferable because it results in a uniform method to value our inventory across all our segments, improves comparability with our peers, and is expected to better reflect the current value of inventory on the consolidated balance sheets. The change in costing method, which affected our Plumbing and Doors & Security segments, was recognized during the fourth quarter of 2018, by adjusting the cost of inventories to FIFO, resulting in a pretax benefit of approximately $7.3 million ($5.5 million after tax) to Cost of products sold in the consolidated statements of income for the year ended December 31, 2018. The impact of this change was not material to our 2017 results of operations and therefore we did not retrospectively apply the change in accounting policy. There were no inventories valued using LIFO as of December 31, 2019 or 2018. Property, Plant and Equipment Property, plant and equipment are carried at cost. Depreciation is provided, principally on a straight-line basis, over the estimated useful lives of the assets. Gains or losses resulting from dispositions are included in operating income. Betterments and renewals, which improve and extend the life of an asset, are capitalized; maintenance and repair costs are expensed as incurred. Assets held for use to be disposed of at a future date are depreciated over the remaining useful life. Assets to be sold are written down to fair value less costs to sell at the time the assets are being actively marketed for sale. Estimated useful lives of the related assets are as follows: Buildings and leasehold improvements 15 to 40 years Machinery and equipment 3 to 15 years Software 3 to 7 years Long-lived Assets In accordance with ASC requirements for Property, Plant and Equipment, a long-lived asset (including amortizable identifiable intangible assets) or asset group held for use is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. When such events occur, we compare the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or asset group to the carrying amount of a long-lived asset or asset group. The cash flows are based on our best estimate of future cash flows derived from the most recent business projections. If this comparison indicates that there is an impairment, the amount of the impairment is calculated based on fair value. Fair value is estimated primarily using discounted expected future cash flows on a market-participant basis. During 2019, we recorded an impairment of $1.7 million related to a long-lived asset to be disposed of in cost of products sold. No impairments of long-lived assets were recorded during 2018. During 2017, we recorded an impairment of $5.1 million related to a long-lived asset to be disposed of in selling, general and administrative expenses. Leases Operating lease assets and operating lease liabilities are recognized based on the present value of the future lease payments over the lease term at commencement date. As most of our lease contracts do not provide an explicit interest rate, we use our incremental borrowing rate in determining the present value of future lease payments. Our incremental borrowing rates include estimates related to the impact of collateralization and the economic environment where the leased asset is located. The operating lease assets also include any prepaid lease payments and initial direct costs incurred, but exclude lease incentives received at lease commencement. Our lease terms include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Our leases have remaining lease terms of 1 to 36 years, some of which may include options to extend or terminate the lease. Operating lease expense is recognized on a straight-line basis over the lease term. We do not recognize leases with an initial term of twelve months or less on the balance sheet and instead recognize the related lease payments as expense in the statement of comprehensive income on a straight-line basis over the lease term. We account for lease and non-lease components as a single lease component for all asset classes. Additionally, for certain equipment leases, we apply a portfolio approach and account for multiple lease components as a single lease component. Certain of our lease agreements include variable rental payments, including rental payments adjusted periodically for inflation. Variable rental payments are expensed during the period they are incurred and therefore are excluded from our lease assets and liabilities. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Goodwill and Indefinite-lived Intangible Assets In accordance with ASC requirements for Intangibles—Goodwill and Other, goodwill is tested for impairment at least annually in the fourth quarter, and written down when impaired. An interim impairment test is performed if an event occurs or conditions change that would more likely than not reduce the fair value of the reporting unit below the carrying value. To evaluate the recoverability of goodwill, we first assess qualitative factors to determine whether it is more likely than not that goodwill is impaired. Qualitative factors include changes in volume, margin, customers and the industry. If it is deemed more likely than not that goodwill for a reporting unit is impaired, we will perform a quantitative impairment test using a weighting of the income and market approaches. For the income approach, we use a discounted cash flow model, estimating the future cash flows of the reporting units to which the goodwill relates and then discounting the future cash flows at a market-participant-based discount rate. In determining the estimated future cash flows, we consider current and projected future levels of income based on management’s plans for that business; business trends, prospects and market and economic conditions; and market-participant considerations. Furthermore, our cash flow projections used to assess impairment of our goodwill and other intangible assets are significantly influenced by our projection for the U.S. home products market, our annual operating plans finalized in the fourth quarter of each year, and our ability to execute on various planned cost reduction initiatives supporting operating income improvements. Our projection for the U.S. home products market is inherently uncertain and is subject to a number of factors, such as employment, home prices, credit availability, new home starts and the rate of home foreclosures. For the market approach, we apply market multiples for peer groups to the current operating results of the reporting units to determine each reporting unit’s fair value. The Company’s reporting units are operating segments, or one level below operating segments when appropriate. When the estimated fair value of a reporting unit is less than its carrying value, we measure and recognize the amount of the goodwill impairment loss based on that difference. The significant assumptions that are used to determine the estimated fair value for goodwill impairment testing include the following: third-party market forecasts of U.S. new home starts and home repair and remodel spending; management’s sales, operating income and cash flow forecasts; peer company EBITDA earnings multiples; the market-participant-based discount rate; and the perpetuity growth rate. Our estimates of reporting unit fair values are based on certain assumptions that may differ from our historical and future actual operating performance. Specifically, assumptions related to growth in the new construction and repair and remodel segments of the U.S. home products markets drive our forecasted sales growth. The market forecasts are developed using independent third-party forecasts from multiple sources. In addition, estimated future operating income and cash flow consider our historical performance at similar levels of sales volume and management’s future operating plans as reflected in annual and long-term plans that are reviewed and approved by management. Purchased intangible assets other than goodwill are amortized over their useful lives unless those lives are determined to be indefinite. The determination of the useful life of an intangible asset other than goodwill is based on factors including historical tradename performance with respect to consumer name recognition, geographic market presence, market share, plans for ongoing tradename support and promotion, customer attrition rates, and other relevant factors. Certain of our tradenames have been assigned an indefinite life as we currently anticipate that these tradenames will contribute cash flows to the Company indefinitely. Indefinite-lived intangible assets are not amortized, but are evaluated at least annually to determine whether the indefinite useful life is appropriate. We measure the fair value of identifiable intangible assets upon acquisition and we review for impairment annually in the fourth quarter and whenever market or business events indicate there may be a potential impairment of that intangible. Impairment losses are recorded to the extent that the carrying value of the indefinite-lived intangible asset exceeds its fair value. The significant assumptions that are used to determine the estimated fair value for indefinite-lived intangible assets upon acquisition and subsequent impairment testing are forecasted revenue growth rates; the assumed royalty rate; and the market-participant discount rate. We measure fair value of our indefinite-lived tradenames using the standard relief-from-royalty approach which estimates the present value of royalty income that could be hypothetically earned by licensing the brand name to a third party over the remaining useful life. The determination of fair value using this technique requires the use of estimates and assumptions related to forecasted revenue growth rates, the assumed royalty rate and the market-participant discount rate. We first assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired. Qualitative factors include changes in volume, customers and the industry. If it is deemed more likely than not that an intangible asset is impaired, we will perform a quantitative impairment test. Events or circumstances that could have a potential negative effect on the estimated fair value of our reporting units and indefinite-lived tradenames include: lower than forecasted revenues, actual new construction and repair and remodel growth rates that fall below our assumptions, actions of key customers, increases in discount rates, continued economic uncertainty, higher levels of unemployment, weak consumer confidence, lower levels of discretionary consumer spending, a decrease in royalty rates and decline in the trading price of our common stock. We cannot predict the occurrence of certain events or changes in circumstances that might adversely affect the carrying value of goodwill and indefinite-lived assets. Investments in Equity Securities In accordance with ASC requirements for Investments – equity securities, we account for non-controlling investments in equity securities at fair value, with any gains or losses recognized through other income and expense. Equity securities without readily determinable fair values are recorded at cost minus impairment, plus or minus any changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. During the fourth quarter of 2018, our Plumbing segment entered into strategic partnerships with several companies who incorporate technology into plumbing-related products, and at the same time acquired non-controlling equity interests in some of our partners. This includes an investment in Flo Technologies, Inc. (“Flo”), a U.S. manufacturer of a comprehensive water monitoring and shut-off system with leak detection and proactive leak detection technologies. In January 2020, we reached an agreement to acquire 100% of Flo’s outstanding shares in a multi-phase transaction. In January 2020, we acquired additional shares in exchange for $52.1 million in cash, including direct transaction costs, which combined with our existing investment resulted in majority ownership of the outstanding shares. From January 2020, we will apply the equity method of accounting to our investment in Flo as the minority shareholders have substantive participating rights which preclude consolidation in our results of operations and statements of financial position and cash flows. The substantive participating rights are due to expire in the first quarter of 2021, at which time we will obtain control of, and begin consolidating, Flo in our results. The second phase, scheduled to occur in the first quarter of 2022, will result in the acquisition of the remaining outstanding shares of Flo for a price based on Flo’s 2021 sales and earnings. As of December 31, 2019, all of our investments in our strategic partners do not have readily determinable fair values. As of December 31, 2019 and 2018, the carrying value of our investments was $29.2 million and $28.7 million, respectively, which is included in other assets within our Consolidated Balance Sheet. Defined Benefit Plans We have a number of pension plans in the United States, covering many of the Company’s employees. In addition, the Company provides postretirement health care and life insurance benefits to certain retirees. Service cost for 2019 relates to benefit accruals in an hourly Union defined benefit plan in our Doors & Security segment. Benefit accruals under all other defined benefit pension plans were frozen as of December 31, 2016. We record amounts relating to these plans based on calculations in accordance with ASC requirements for Compensation – Retirement Benefits, which include various actuarial assumptions, including discount rates, assumed rates of return, compensation increases, turnover rates and health care cost trend rates. We recognize changes in the fair value of pension plan assets and net actuarial gains or losses in excess of 10 percent of the greater of the fair value of pension plan assets or each plan’s projected benefit obligation (the “corridor”) in earnings immediately upon remeasurement, which is at least annually in the fourth quarter of each year. We review our actuarial assumptions on an annual basis and make modifications to the assumptions based on current economic conditions and trends. The discount rate used to measure obligations is based on a spot-rate yield curve on a plan-by-plan basis that matches projected future benefit payments with the appropriate interest rate applicable to the timing of the projected future benefit payments. The expected rate of return on plan assets is determined based on the nature of the plans’ investments, our current asset allocation and our expectations for long-term rates of return. Compensation increases reflect expected future compensation trends. For postretirement benefits, our health care trend rate assumption is based on historical cost increases and expectations for long-term increases. The cost or benefit of plan changes, such as increasing or decreasing benefits for prior employee service (prior service cost), is deferred and included in expense on a straight-line basis over the average remaining service period of the related employees. We believe that the assumptions utilized in recording obligations under our plans, which are presented in Note 16, “Defined Benefit Plans,” are reasonable based on our experience and on advice from our independent actuaries; however, differences in actual experience or changes in the assumptions may materially affect our financial position and results of operations. We will continue to monitor these assumptions as market conditions warrant. Insurance Reserves We provide for expenses associated with workers’ compensation and product liability obligations when such amounts are probable and can be reasonably estimated. The accruals are adjusted as new information develops or circumstances change that would affect the estimated liability. Litigation Contingencies Our businesses are subject to risks related to threatened or pending litigation and are routinely defendants in lawsuits associated with the normal conduct of business. Liabilities and costs associated with litigation-related loss contingencies require estimates and judgments based on our knowledge of the facts and circumstances surrounding each matter and the advice of our legal counsel. We record liabilities for litigation-related losses when a loss is probable and we can reasonably estimate the amount of the loss in accordance with ASC requirements for Contingencies. We evaluate the measurement of recorded liabilities each reporting period based on the then-current facts and circumstances specific to each matter. The ultimate losses incurred upon final resolution of litigation-related loss contingencies may differ materially from the estimated liability recorded at any particular balance sheet date. Changes in estimates are recorded in earnings in the period in which such changes occur. Income Taxes In accordance with ASC requirements for Income Taxes, we establish deferred tax liabilities or assets for temporary differences between financial and tax reporting bases and subsequently adjust them to reflect changes in tax rates expected to be in effect when the temporary differences reverse. We record a valuation allowance reducing deferred tax assets when it is more likely than not that such assets will not be realized. We record liabilities for uncertain income tax positions based on a two-step process. The first step is recognition, where we evaluate whether an individual tax position has a likelihood of greater than 50% of being sustained upon examination based on the technical merits of the position, including resolution of any related appeals or litigation processes. For tax positions that are currently estimated to have a less than 50% likelihood of being sustained, no tax benefit is recorded. For tax positions that have met the recognition threshold in the first step, we perform the second step of measuring the benefit to be recorded. The actual benefits ultimately realized may differ from our estimates. In future periods, changes in facts, circumstances, and new information may require us to change the recognition and measurement estimates with regard to individual tax positions. Changes in recognition and measurement estimates are recorded in the consolidated statement of income and consolidated balance sheet in the period in which such changes occur. As of December 31, 2019, we had liabilities for unrecognized tax benefits pertaining to uncertain tax positions totaling $88.0 million. It is reasonably possible that the unrecognized tax benefits may decrease in the range of $3.1 million to $3.8 million in the next 12 months primarily as a result of the conclusion of U.S. federal, state and foreign income tax proceedings. The Tax Act, enacted on December 22, 2017, made significant changes to the U.S. Internal Revenue Code including a reduction in the corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017, an exemption from federal income tax for dividends received from foreign subsidiaries, and an imposition of a one-time transition tax on the deemed repatriation of cumulative foreign earnings and profits as of December 31, 2017. Revenue Recognition The Company recognizes revenue for the sale of goods based on its assessment of when control transfers to our customers. Refer to Note 15 for additional information. Cost of Products Sold Cost of products sold includes all costs to make products saleable, such as labor costs, inbound freight, purchasing and receiving costs, inspection costs and internal transfer costs. In addition, all depreciation expense associated with assets used to manufacture products and make them saleable is included in cost of products sold. Customer Program Costs Customer programs and incentives are a common practice in our businesses. Our businesses incur customer program costs to obtain favorable product placement, to promote sales of products and to maintain competitive pricing. We record estimates to reduce revenue for customer programs and incentives, which are considered variable consideration, and include price discounts, volume-based incentives, promotions and cooperative advertising when revenue is recognized in order to determine the amount of consideration the Company will ultimately be entitled to receive. These estimates are based on historical and projected experience for each type of customer. In addition, for certain customer program incentives, we receive an identifiable benefit (goods or services) in exchange for the consideration given and record the associated expenditure in selling, general and administrative expenses. Volume allowances are accrued based on management’s estimates of customer volume achievement and other factors incorporated into customer agreements, such as new products, store sell-through, merchandising support, levels of returns and customer training. Management periodically reviews accruals for these rebates and allowances, and adjusts accruals when circumstances indicate (typically as a result of a change in volume expectations). The costs typically recognized in “selling, general and administrative expenses” include product displays, point of sale materials and media production costs. The costs typically recognized in selling, general and administrative expenses include product displays, point of sale materials and media production costs. The costs included in the selling, general and administrative expenses category were $66.3 million, $66.5 million and $62.4 million for the years ended December 31, 2019, 2018 and 2017, respectively. Selling, General and Administrative Expenses Selling, general and administrative expenses include advertising costs; marketing costs; selling costs, including commissions; research and development costs; shipping and handling costs, including warehousing costs; and general and administrative expenses. Shipping and handling costs included in selling, general and administrative expenses were $225.5 million, $215.9 million and $204.7 million in 2019, 2018 and 2017, respectively . Advertising costs, which amounted to $251.7 million, $243.6 million and $233.2 million in 2019, 2018 and 2017, respectively, are principally expensed as incurred. Advertising costs paid to customers as pricing rebates include product displays, marketing administration costs, media production costs and point of sale materials. Advertising costs recorded as a reduction to net sales, primarily cooperative advertising, were $74.0 million, $72.4 million and $65.6 million in 2019, 2018 and 2017, respectively. Advertising costs recorded in selling, general and administrative expenses were $177.7 million, $171.2 million and $167.6 million in 2019, 2018 and 2017, respectively. Research and development expenses include product development, product improvement, product engineering and process improvement costs. Research and development expenses, which were $48.2 million, $50.3 million and $50.7 million in 2019, 2018 and 2017, respectively, are expensed as incurred. Stock-based Compensation Stock-based compensation expense, measured as the fair value of an award on the date of grant, is recognized in the financial statements over the period that an employee is required to provide services in exchange for the award. The fair value of each option award is measured on the date of grant using the Black-Scholes option-pricing model. The fair value of each performance share award is based on the average of the high and low share prices on the date of grant and the probability of meeting performance targets. The fair value of each restricted stock unit granted is equal to the average of the high and low share prices on the date of grant. See Note 14, “Stock-Based Compensation,” for additional information. Earnings Per Share Earnings per common share is calculated by dividing net income attributable to Fortune Brands by the weighted-average number of shares of common stock outstanding during the year. Diluted earnings per common share include the impact of all potentially dilutive securities outstanding during the year. See Note 22, “Earnings Per Share,” for further discussion. Foreign Currency Translation Foreign currency balance sheet accounts are translated into U.S. dollars at the actual rates of exchange at the balance sheet date. Income and expenses are translated at the average rates of exchange in effect during the period for the foreign subsidiaries where the local currency is the functional currency. The related translation adjustments are made directly to a separate component of the “accumulated other comprehensive income” (“AOCI”) caption in equity. Transactions denominated in a currency other than the functional currency of a subsidiary are translated into functional currency with resulting transaction gains or losses recorded in other expense, net. Derivative Financial Instruments In accordance with ASC requirements for Derivatives and Hedging, we recognize all derivative contracts as either assets or liabilities on the balance sheet, and the measurement of those instruments is at fair value. If the derivative is designated as a fair value hedge and is effective, the changes in the fair value of the derivative and of the hedged item attributable to the hedged risk are recognized in earnings in the same period. If the derivative is designated as a cash flow hedge, the changes in the fair value of the derivative are recorded in other comprehensive income (“OCI”) and are recognized in the consolidated statement of income when the hedged item affects earnings. If the derivative is designated as an effective economic hedge of the net investment in a foreign operation, the changes in the fair value of the derivative is reported in the cumulative translation adjustment section of OCI. Similar to foreign currency translation adjustments, these changes in fair value are recognized in earnings only when realized upon sale or upon complete or substantially complete liquidation of the investment in the foreign entity. Deferred currency gains of $4.1 million, $2.2 million and $0.4 million (before tax impact) were reclassified into earnings for the year ended December 31, 2019, 2018 and 2017, respectively. Based on foreign exchange rates as of December 31, 2019, we estimate that $2.3 million of net derivative gain included in AOCI as of December 31, 2019 will be reclassified to earnings within the next twelve months. Recently Issued Accounting Standards Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, which requires lessees to recognize almost all leases on their balance sheet as “right-of-use” assets and lease liabilities but recognize related expenses in a manner similar to previous accounting guidance. The guidance also eliminates previous real estate-specific provisions for all entities. In January 2018, the FASB issued ASU 2018-01, which clarifies the application of the new leases guidance to land easements. In July 2018, the FASB issued ASU 2018-10 and ASU 2018-11, which clarify certain guidance included in ASU 2016-02 and introduces a new optional transition method, which does not require revisions to comparative periods. We adopted this standard as of January 1, 2019 using the transition method introduced by ASU 2018-11, which does not require revisions to comparative periods. We elected to implement the transition package of practical expedients permitted within the new standard, which among other things, allows us to carryforward the historical lease classification. In addition, we elected the hindsight practical expedient to determine the lease term for existing leases. Adoption of the new standard resulted in the recording of lease assets and lease liabilities of approximately $177.2 million and $182.6 million, respectively, as of January 1, 2019. The difference between the lease assets and lease liabilities primarily relates to accrued rent and unamortized lease incentives recorded in accordance with the previous leasing guidance. The new standard did not materially impact our consolidated statements of income or cash flows. Improvements to Accounting for Hedging Activities In August 2017, the FASB issued ASU 2017-12, which amends the current hedge accounting model. The new standard eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item (which is consistent with our prior practice). The change in fair value for qualifying cash flow and net investment hedges is included in other comprehensive loss (until they are reclassified into the income statement). The standard also eased certain documentation and assessment requirements and modified the accounting for components excluded from the assessment of hedge effectiveness. We adopted this standard as of January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In February 2018, the FASB issued ASU 2018-02, which permits companies to reclassify to retained earnings the tax effects stranded in accumulated other comprehensive income (“AOCI”) as a result of the U.S. Tax Cuts and Jobs Act of 2017. We adopted this standard on January 1, 2019, which resulted in a reclassification of $8.6 million between accumulated other comprehensive loss and retained earnings in our consolidated statement of equity. Improvements to Nonemployee Share-Based Payment Accounting In June 2018, the FASB issued ASU 2018-07, which simplifies the accounting for share-based arrangements with nonemployees. The new guidance generally aligns the accounting for share-based awards to nonemployees with the guidance for |
Balance Sheet Information
Balance Sheet Information | 12 Months Ended |
Dec. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Balance Sheet Information | 3. Balance Sheet Information Supplemental information on our year-end consolidated balance sheets is as follows: (In millions) 2019 2018 Inventories: Raw materials and supplies $ 274.4 $ 227.4 Work in process 72.2 66.4 Finished products 372.0 385.1 Total inventories $ 718.6 $ 678.9 Property, plant and equipment: Land and improvements $ 66.3 $ 66.8 Buildings and improvements to leaseholds 510.2 500.1 Machinery and equipment 1,316.2 1,249.0 Construction in progress 89.8 95.8 Property, plant and equipment, gross 1,982.5 1,911.7 Less: accumulated depreciation 1,158.3 1,098.3 Property, plant and equipment, net of accumulated depreciation $ 824.2 $ 813.4 Other current liabilities: Accrued salaries, wages and other compensation $ 109.7 $ 85.9 Accrued customer programs 179.5 167.8 Accrued taxes 39.3 57.7 Dividends payable 33.5 30.9 Other accrued expenses 187.6 165.8 Total other current liabilities $ 549.6 $ 508.1 |
Acquisitions and Dispositions
Acquisitions and Dispositions | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisitions and Dispositions | 4. Acquisitions and Dispositions In September 2018, we acquired 100% of the membership interests of Fiber Composites LLC (“Fiberon”), a leading U.S. manufacturer of outdoor performance materials used in decking and railing products for a total purchase price of approximately $470.0 million, subject to certain post-closing adjustments. The acquisition of Fiberon provided category expansion and product extension opportunities into the outdoor living space for our Doors & Security segment. Fiberon’s net sales and operating income in 2018 were not material to the Company. We have not included pro forma financial information as it is immaterial to our consolidated statements of comprehensive income. We financed the transaction using cash on hand and borrowings under our revolving credit and term loan facilities. The results of operations are included in the Doors & Security segment from the date of the acquisition. Goodwill related to this acquisition is deductible for income tax purposes. The following table summarizes the final allocation of the purchase price to the fair value of assets acquired and liabilities assumed as of the date of the acquisition. (In millions) Accounts receivable $ 18.8 Inventories 50.9 Property, plant and equipment 45.7 Goodwill 177.7 Identifiable intangible assets 195.0 Other assets 4.8 Total assets 492.9 Accounts payable 16.8 Other liabilities and accruals 16.3 Net assets acquired $ 459.8 Goodwill includes expected sales and cost synergies. Identifiable intangible assets primarily consist of customer relationships and tradenames. In October 2017, we acquired Victoria+Albert, a UK-based premium brand of standalone bathtubs, sinks, tub fillers, faucets and other accessories. In July 2017, we acquired Shaws, a UK-based luxury plumbing products company that specializes in manufacturing and selling fireclay sinks and selling brassware and accessories. The total combined consideration paid was approximately $165 million, including $38.9 million of additional purchase price consideration paid related to post-closing adjustments and deferred acquisition payments during 2019 and 2018. Net sales and operating income in 2017 from these acquisitions were not material to the Company. We financed the transactions using cash on hand and borrowings under our existing revolving and term loan credit facilities. The results of the operations are included in the Plumbing segment from the respective dates of acquisition. Goodwill related to these acquisitions is not deductible for income tax purposes. In April 2017, we completed the sale of Field ID, our cloud-based inspection and safety compliance software product line included in our Doors & Security segment. We recorded a pre-tax loss of $2.4 million and a pre-tax impairment charge to write down the long-lived assets included in this disposal group to fair value of $3.2 million as a result of this sale (See Note 8). The estimated tax expense on the sale was insignificant. Field ID did not qualify for presentation as a discontinued operation in our financial statements. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2019 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Discontinued Operations | 5. Discontinued Operations In the twelve months ended December 31, 2018 and 2017, the loss on discontinued operations of $0.2 million and $2.6 million, respectively, is primarily related to the prior sale of the Waterloo tool storage and Simonton window businesses. |
Goodwill and Identifiable Intan
Goodwill and Identifiable Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Identifiable Intangible Assets | 6. Goodwill and Identifiable Intangible Assets We had goodwill of $2,090.2 million and $2,080.3 million as of December 31, 2019 and 2018, respectively. The change in the net carrying amount of goodwill by segment was as follows: (In millions) Cabinets Plumbing Doors & Security Total Goodwill Balance at December 31, 2017 (a) $ 926.3 $ 745.2 $ 240.5 $ 1,912.0 2018 translation adjustments (2.3 ) (5.9 ) (1.4 ) (9.6 ) Acquisition-related adjustments — 4.4 173.5 177.9 Balance at December 31, 2018 (a) $ 924.0 $ 743.7 $ 412.6 $ 2,080.3 2019 translation adjustments 1.5 3.6 0.5 5.6 Acquisition-related adjustments — — 4.3 4.3 Balance at December 31, 2019 (a) $ 925.5 $ 747.3 $ 417.4 $ 2,090.2 (a) Net of accumulated impairment losses of $399.5 million in the Doors & Security segment. We also had identifiable intangible assets, principally tradenames and customer relationships, of $1,168.9 million and $1,246.8 million as of December 31, 2019 and 2018, respectively. The $34.0 The gross carrying value and accumulated amortization by class of intangible assets as of December 31, 2019 and 2018 were as follows: As of December 31, 2019 As of December 31, 2018 (In millions) Gross Carrying Amounts Accumulated Amortization Net Book Value Gross Carrying Amounts Accumulated Amortization Net Book Value Indefinite-lived tradenames $ 635.6 $ — $ 635.6 $ 673.9 $ — $ 673.9 Amortizable intangible assets Tradenames 20.6 (12.9 ) 7.7 19.8 (11.9 ) 7.9 Customer and contractual relationships 803.9 (299.6 ) 504.3 800.3 (260.2 ) 540.1 Patents/proprietary technology 73.4 (52.1 ) 21.3 73.5 (48.6 ) 24.9 Total 897.9 (364.6 ) 533.3 893.6 (320.7 ) 572.9 Total identifiable intangibles $ 1,533.5 $ (364.6 ) $ 1,168.9 $ 1,567.5 $ (320.7 ) $ 1,246.8 Amortizable intangible assets, principally customer relationships, are subject to amortization on a straight-line basis over their estimated useful life, ranging from 2 to 30 years, based on the assessment of a number of factors that may impact useful life which include customer attrition rates and other relevant factors. We expect to record intangible amortization of approximately $42 million in 2020, $42 million in 2021, $40 million in 2022, $39 million in 2023, and $38 million in 2024. In the fourth quarter of 2019, we recognized an impairment charge of $12.0 million related to an indefinite-lived tradename in our Cabinets segment. This charge was the result of a strategic shift associated with new segment leadership and acceleration of our capacity rebalancing initiatives from custom cabinetry products to value-based cabinetry products as a result of lower than expected sales of custom cabinetry products compared to prior forecasts. As of December 31, 2019, the estimated fair value of this tradename equaled its carrying value of $38.6 million. In the third quarter of 2019, we recognized an impairment charge of $29.5 million related to a second indefinite-lived tradename in our Cabinets segment, which was primarily the result of a continuing shift in consumer demand from semi-custom cabinetry products to value-priced cabinetry products, which led to consecutive downward adjustments of internal sales forecasts and future growth rates associated with the tradename. In the fourth quarter of 2018, we recorded an impairment charge of $35.5 million related to the same indefinite-lived tradename, which was primarily the result of lower than forecasted sales during the fourth quarter of 2018 as well as projected changes in the mix of revenue across our tradenames in future periods, including the impact of more moderate industry growth expectations, which were finalized during our annual planning process conducted during the fourth quarter of 2018. As of December 31, 2019, the estimated fair value of this tradename exceeded its carrying value of $85.0 million by less than 10%. During the third quarter of 2018, we recorded a pre-tax impairment charge of $27.1 million related to a third indefinite-lived tradename within the Cabinets segment. This charge was primarily the result of reduced revenue growth expectations associated with Cabinets operations in Canada, including the announced closure of Company-owned retail locations. As of December 31, 2019, the estimated fair value of this tradename exceeded its carrying value of $39.1 million by less than 10%. The fair values of the impaired tradenames were measured using the relief-from-royalty approach, which estimates the present value of royalty income that could be hypothetically earned by licensing the tradename to a third party over its remaining useful life. Some of the more significant assumptions inherent in estimating the fair values include forecasted revenue growth rates for the tradename, assumed royalty rate, and a market-participant discount rate that reflects the level of risk associated with the tradenames’ future revenues and profitability. We selected the assumptions used in the financial forecasts using historical data, supplemented by current and anticipated market conditions, estimated growth rates, and management plans. These assumptions represent level 3 inputs of the fair value hierarchy (refer to Note 11). A reduction in the estimated fair value of these three tradenames could trigger additional impairment charges in future periods. Events or circumstances that could have a potential negative effect on the estimated fair value of our reporting units and indefinite-lived tradenames include: lower than forecasted revenues, actual new construction and repair and remodel growth rates that fall below our assumptions, actions of key customers, increases in discount rates, continued economic uncertainty, higher levels of unemployment, weak consumer confidence, lower levels of discretionary consumer spending, a decrease in royalty rates and a decline in the trading price of our common stock. We cannot predict the occurrence of certain events or changes in circumstances that might adversely affect the carrying value of goodwill and indefinite-lived assets. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | 7. Leases As discussed in Note 2, we adopted ASU 2016-02 as of January 1, 2019. We have operating and finance leases for buildings and certain machinery and equipment. Operating leases are included in operating lease assets, other current liabilities, and operating lease liabilities in our consolidated balance sheets. Amounts recognized for finance leases as of and for the year ended December 31, 2019 were immaterial. Operating lease expense recognized in the consolidated statement of comprehensive income for the year ended December 31, 2019 was $51.0 Other information related to leases was as follows: (In millions, except lease term and discount rate) December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 41.3 Right-of-use assets obtained in exchange for operating lease obligations $ 24.5 Weighted average remaining lease term - operating leases 7.1 years Weighted average discount rate - operating leases 4.2 % Total lease payments under non-cancellable operating leases as of December 31, 2019 were as follows: (In millions) Year Ending December 31, 2020 $ 39.1 2021 33.4 2022 26.8 2023 22.6 2024 18.9 Thereafter 61.4 Total lease payments 202.2 Less imputed interest (29.3 ) Total $ 172.9 Reported as of December 31, 2019 Other current liabilities $ 33.1 Operating lease liabilities 139.8 Total $ 172.9 |
Asset Impairment Charges
Asset Impairment Charges | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Asset Impairment Charges | 8. Asset Impairment Charges In January 2017, we committed to a plan to sell Field ID, our cloud-based inspection and safety compliance software product line included in our Doors & Security segment. In accordance with FASB Accounting Standards Codification (“ASC”) 360, as a result of our decision to sell, during the first quarter of 2017 we recorded $3.2 million of pre-tax impairment charges to write down the long-lived assets included in this disposal group to fair value, based upon their estimated fair value less cost to sell. These charges consisted of approximately $3.0 million for definite-lived intangible assets and $0.2 million for fixed assets. We completed the sale of Field ID in April 2017. |
External Debt and Financing Arr
External Debt and Financing Arrangements | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
External Debt and Financing Arrangements | 9. External Debt and Financing Arrangements Unsecured Senior Notes At December 31, 2019, the Company had aggregate outstanding notes in the principal amount of $2.2 billion, with varying maturities (the “Notes”). The Notes are unsecured senior obligations of the Company. The following table provides a summary of the Company’s outstanding Notes, including the carrying value of the Notes, net of underwriting commissions, price discounts, and debt issuance costs as of December 31, 2019 and December 31, 2018: (in millions) Net Carrying Value Coupon Rate Principal Amount Issuance Date Maturity Date December 31, 2019 December 31, 2018 3.000% Senior Notes $ 400.0 June 2015 June 2020 $ 399.7 $ 399.0 4.000% Senior Notes 500.0 June 2015 June 2025 495.8 495.0 4.000% Senior Notes (the “2018 Notes”) 600.0 September 2018 September 2023 596.1 595.0 3.250% Senior Notes (the “2019 Notes”) 700.0 September 2019 September 2029 692.7 — Total Senior Notes $ 2,200.0 $ 2,184.3 $ 1,489.0 In September 2019, we issued $700 million of unsecured senior notes (“2019 Notes”) in a registered public offering. The 2019 Notes are due in 2029 with a coupon rate of 3.25%. The Company used the proceeds from the 2019 Notes offering to repay in full the Company’s $350 million term loan and to pay down outstanding balances under our revolving credit facility . In September 2018, we issued $600 million of unsecured senior notes (“2018 Notes”) in a registered public offering. The 2018 Notes are due in 2023 with a coupon rate of 4%. We used the proceeds from the 2018 Notes offering to pay down our revolving credit facility. Notes payments during the next five years as of December 31, 2019 are $400 million in 2020, zero in 2021 through 2022 and $600 million in 2023 through 2024. Credit Facilities In September 2019, the Company entered into a second amended and restated $1.25 billion revolving credit facility (the “2019 Revolving Credit Agreement”), and borrowings thereunder will be used for general corporate purposes. The terms and conditions of the 2019 Revolving Credit Agreement, including the total commitment amount, essentially remained the same as under the previous credit agreement, except that the maturity date was extended to September 2024. Borrowings amounting to $165.0 million were rolled-over from the prior revolving credit facility into the 2019 Revolving Credit Agreement. Interest rates under the 2019 Revolving Credit Agreement are variable based on LIBOR at the time of the borrowing and the Company’s long-term credit rating and can range from LIBOR + 0.91% to LIBOR + 1.4%. The amendment also includes a covenant under which the Company is required to maintain a minimum ratio of consolidated EBITDA to consolidated interest expense of 3.0 to 1.0. Adjusted EBITDA is defined as consolidated net income before interest expense, income taxes, depreciation, amortization of intangible assets, losses from asset impairments, and certain other one-time adjustments. In addition, the amendment includes a covenant under which the Company’s ratio of consolidated debt minus certain cash and cash equivalents to consolidated EBITDA generally may not exceed 3.5 to 1.0. This amendment and restatement of the credit agreement was a non-cash transaction for the Company. On December 31, 2019 and December 31, 2018, our outstanding borrowings under these credit facilities were zero In September 2019, the Company used the proceeds from the 2019 Notes to repay the full outstanding balance on the Term Loan entered into in March 2018 and subsequently amended in August 2018 and March 2019 (the “Term Loan”). Following the March 2019 amendment, the Term Loan provided for borrowings of $350 million and was scheduled to mature in March 2020. At December 31, 2019 and December 31, 2018, amounts due under the Term Loan were zero and $525.0 million, respectively, which is included within Short-term debt in the consolidated balance sheets. We currently have uncommitted bank lines of credit in China, which provide for unsecured borrowings for working capital of up to $17.5 million in aggregate as of December 31, 2019 and $23.5 million in aggregate as of December 31, 2018, of which zero was outstanding as of December 31, 2019 and 2018. The components of long-term debt were as follows: (In millions) 2019 2018 Notes $ 2,184.3 $ 1,489.0 $1,250 million revolving credit agreement due September 2024 — 320.0 Term Loan (due March 2020) — 525.0 Total debt 2,184.3 2,334.0 Less: current portion 399.7 525.0 Total long-term debt $ 1,784.6 $ 1,809.0 In our debt agreements, there are normal and customary events of default which would permit the lenders to accelerate the debt if not cured within applicable grace |
Financial Instruments
Financial Instruments | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Financial Instruments | 10. Financial Instruments We do not enter into financial instruments for trading or speculative purposes. We principally use financial instruments to reduce the impact of changes in foreign currency exchange rates and commodities used as raw materials in our products. The principal derivative financial instruments we enter into on a routine basis are foreign exchange contracts. Derivative financial instruments are recorded at fair value. The counterparties to derivative contracts are major financial institutions. We are subject to credit risk on these contracts equal to the fair value of these instruments. Management currently believes that the risk of incurring material losses is unlikely and that the losses, if any, would be immaterial to the Company. Raw materials used by the Company are subject to price volatility caused by weather, supply conditions, geopolitical and economic variables, and other unpredictable external factors. As a result, from time to time, we enter into commodity swaps to manage the price risk associated with forecasted purchases of materials used in our operations. We account for these commodity derivatives as economic hedges or cash flow hedges. Changes in the fair value of economic hedges are recorded directly into current period earnings. There were no material commodity swap contracts outstanding for the years ended December 31, 2019 and 2018. We enter into foreign exchange contracts primarily to hedge forecasted sales and purchases denominated in select foreign currencies, thereby limiting currency risk that would otherwise result from changes in exchange rates. The periods of the foreign exchange contracts correspond to the periods of the forecasted transactions, which generally do not exceed 12 to 15 months subsequent to the latest balance sheet date. For derivative instruments that are designated as fair value hedges, the gain or loss on the derivative instrument, as well as the offsetting loss or gain on the hedged item, are recognized on the same line of the statement of income. The changes in the fair value of cash flow hedges are reported in other comprehensive income (“OCI”) and are recognized in the statement of income when the hedged item affects earnings. The changes in fair value for net investment hedges are recognized in the statement of income when realized upon sale or upon complete or substantially complete liquidation of the investment in the foreign entity. In addition, changes in the fair value of all economic hedge transactions are immediately recognized in current period earnings. Our primary foreign currency hedge contracts pertain to the Canadian dollar, the British pound, the Chinese yuan and the Mexican peso. The gross U.S. dollar equivalent notional amount of all foreign currency derivative hedges outstanding at December 31, 2019 was $388.8 million, representing a net settlement asset of $0.7 million. Based on foreign exchange rates as of December 31, 2019, we estimate that $2.3 million of net derivative gains included in accumulated other comprehensive income as of December 31, 2019 will be reclassified to earnings within the next twelve months. The fair values of foreign exchange and commodity derivative instruments on the consolidated balance sheets as of December 31, 2019 and 2018 were: Fair Value (In millions) Location 2019 2018 Assets: Foreign exchange contracts Other current assets $ 2.9 $ 5.3 Commodity contracts Other current assets 0.1 — Net investment hedges Other current assets — 0.7 Total assets $ 3.0 $ 6.0 Liabilities: Foreign exchange contracts Other current liabilities $ 2.2 $ 1.9 Net investment hedges Other current liabilities 0.3 — Total liabilities $ 2.5 $ 1.9 The effects of derivative financial instruments on the consolidated statements of income in 2019, 2018 and 2017 were: (In millions) Classification and Amount of Gain (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships 2019 Cost of products sold Interest expense Other expense, net Total amounts per Consolidated Statements of Income $ 3,712.2 $ 94.2 $ 29.0 The effects of fair value and cash flow hedging: Gain (loss) on fair value hedging relationships Foreign exchange contracts: Hedged items 4.0 Derivative designated as hedging instruments (3.0 ) Gain (loss) on cash flow hedging relationships Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 4.1 Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income (0.1 ) Interest rate contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 0.4 (In millions) Classification and Amount of Gain (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships 2018 Cost of products sold Interest expense Other income, net Total amounts per Consolidated Statements of Income $ 3,525.7 $ 74.5 $ 16.3 The effects of fair value and cash flow hedging: Gain (loss) on fair value hedging relationships Foreign exchange contracts: Hedged items (3.4 ) Derivative designated as hedging instruments 5.0 Gain (loss) on cash flow hedging relationships Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 2.2 Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income (0.2 ) Interest rate contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 0.1 (In millions) Classification and Amount of Gain (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships 2017 Cost of products sold Interest expense Other income, net Total amounts per Consolidated Statements of Income $ 3,358.3 $ 49.4 $ 1.7 The effects of fair value and cash flow hedging: Gain (loss) on fair value hedging relationships Foreign exchange contracts: Hedged items 2.7 Derivative designated as hedging instruments (3.5 ) Gain (loss) on cash flow hedging relationships Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 0.4 Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 0.5 Interest rate contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income - The cash flow hedges recognized in other comprehensive income were net gains (losses) of $4.8 million, $10.1 million and ($1.8) million in 2019, 2018 and 2017 respectively. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 11. Fair Value Measurements ASC requirements for Fair Value Measurements and Disclosures establish a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels. Level 1 inputs, the highest priority, are quoted prices in active markets for identical assets or liabilities. Level 2 inputs reflect other than quoted prices included in level 1 that are either observable directly or through corroboration with observable market data. Level 3 inputs are unobservable inputs due to little or no market activity for the asset or liability, such as internally-developed valuation models. We do not have any assets or liabilities measured at fair value on a recurring basis that are level 3, except for pension assets discussed in Note 16. The carrying value and fair value of debt as of December 31, 2019 and 2018 were as follows: (In millions) December 31, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value Revolving credit facility $ — $ — $ 320.0 $ 320.0 Term Loan — — 525.0 525.0 Senior Notes, net of underwriting commissions and price discounts 2,184.3 2,271.4 1,489.0 1,490.4 The estimated fair value of our term loan and revolving credit facility is determined primarily using broker quotes, which are level 2 inputs. The estimated fair value of our Senior Notes is determined by using quoted market prices of our debt securities, which are level 1 inputs. Assets and liabilities measured at fair value on a recurring basis as of December 31, 2019 and 2018 were as follows: (In millions) Fair Value 2019 2018 Assets: Derivative asset financial instruments (level 2) $ 3.0 $ 6.0 Deferred compensation program assets (level 2) 12.1 9.3 Total assets $ 15.1 $ 15.3 Liabilities: Derivative liability financial instruments (level 2) $ 2.5 $ 1.9 The principal derivative financial instruments we enter into on a routine basis are foreign exchange contracts. In addition, from time to time, we enter into commodity swaps. Derivative financial instruments are recorded at fair value. |
Capital Stock
Capital Stock | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Capital Stock | 12. Capital Stock The Company has 750 million authorized shares of common stock, par value $0.01 per share and 60 million authorized shares of preferred stock, par value $0.01 per share. The number of shares of common stock and treasury stock and the share activity for 2019 and 2018 were as follows: Common Shares Treasury Shares 2019 2018 2019 2018 Balance at the beginning of the year 140,498,981 151,906,797 40,110,623 27,879,929 Stock plan shares issued 1,281,198 822,878 — — Shares surrendered by optionees (185,141 ) (230,550 ) 185,141 230,550 Common stock repurchases (2,039,551 ) (12,000,144 ) 2,039,551 12,000,144 Balance at the end of the year 139,555,487 140,498,981 42,335,315 40,110,623 At December 31, 2019, no shares of our preferred stock were outstanding. Our Board of Directors has the authority, without action by the Company’s stockholders, to designate and issue our preferred stock in one or more series and to designate the rights, preferences, limitations and privileges of each series of preferred stock, which may be greater than the rights of the Company’s common stock. In 2019, we repurchased 2.0 million shares of outstanding common stock under the Company’s share repurchase program for $100.0 million. As of December 31, 2019, the Company’s total remaining share repurchase authorization under the remaining program was approximately $314 million. The share repurchase program does not obligate the Company to repurchase any specific dollar amount or number of shares and may be suspended or discontinued at any time. In December 2019, our Board of Directors declared a cash dividend of $0.24 per share of common stock, which represents an increase of 9% from the previous dividend. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Accumulated Other Comprehensive (Loss) Income | 13. Accumulated Other Comprehensive (Loss) Income The reclassifications out of accumulated other comprehensive (loss) income for the years ended December 31, 2019 and 2018 were as follows: (In millions) Details about Accumulated Other Comprehensive Income Components Affected Line Item in the Consolidated Statements of Income 2019 2018 Gains (losses) on cash flow hedges Foreign exchange contracts $ 4.1 $ 2.2 Cost of products sold Interest rate contracts 0.4 0.1 Interest expense Commodity contracts (0.1 ) (0.2 ) Cost of products sold 4.4 2.1 Total before tax (0.6 ) (0.4 ) Tax expense $ 3.8 $ 1.7 Net of tax Defined benefit plan items Recognition of actuarial losses (34.1 ) (3.8 ) (a) 8.3 0.8 Tax expense $ (25.8 ) $ (3.0 ) Net of tax Total reclassifications for the period $ (22.0 ) $ (1.3 ) Net of tax (a) These accumulated other comprehensive (loss) income components are included in the computation of net periodic benefit cost. Refer to Note 16, “Defined Benefit Plans,” for additional information. Total accumulated other comprehensive (loss) income consists of net income and other changes in business equity from transactions and other events from sources other than shareholders. It includes currency translation gains and losses, unrealized gains and losses from derivative instruments designated as cash flow hedges, and defined benefit plan adjustments. The after-tax components of and changes in accumulated other comprehensive (loss) income were as follows: (In millions) Foreign Currency Adjustments Derivative Hedging Gain (Loss) Defined Benefit Plan Adjustments Accumulated Other Comprehensive (Loss) Income Balance at December 31, 2016 $ (28.0 ) $ (0.6 ) $ (43.3 ) $ (71.9 ) Amounts classified into accumulated other comprehensive (loss) income 33.8 (1.0 ) 4.3 37.1 Amounts reclassified from accumulated other comprehensive (loss) income into earnings — (0.8 ) (3.6 ) (4.4 ) Net current period other comprehensive (loss) income 33.8 (1.8 ) 0.7 32.7 Balance at December 31, 2017 $ 5.8 $ (2.4 ) $ (42.6 ) $ (39.2 ) Amounts classified into accumulated other comprehensive (loss) income (31.1 ) 8.3 (6.3 ) (29.1 ) Amounts reclassified into earnings — (1.7 ) 3.0 1.3 Net current period other comprehensive (loss) income (31.1 ) 6.6 (3.3 ) (27.8 ) Balance at December 31, 2018 $ (25.3 ) $ 4.2 $ (45.9 ) $ (67.0 ) Amounts classified into accumulated other comprehensive (loss) income 13.8 5.1 (37.9 ) (19.0 ) Amounts reclassified into earnings — (3.8 ) 25.8 22.0 Adoption of ASU 2018-02 — — (8.6 ) (8.6 ) Net current period other comprehensive (loss) income 13.8 1.3 (20.7 ) (5.6 ) Balance at December 31, 2019 $ (11.5 ) $ 5.5 $ (66.6 ) $ (72.6 ) |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation | 14. Stock-Based Compensation As of December 31, 2019, we had awards outstanding under two Long-Term Incentive Plans, the Fortune Brands Home & Security, Inc. 2013 Long-Term Incentive Plan (the “Plan”) and the 2011 Long-Term Incentive Plan (the “2011 Plan”, and together with the Plan - the “Plans”). Our stockholders approved the Plan in 2013, which Upon the exercise or payment of stock-based awards, shares of common stock are issued from authorized common shares. Stock-based compensation expense from continuing operations was as follows: (In millions) 2019 2018 2017 Stock option awards $ 7.0 $ 8.6 $ 7.4 Restricted stock units 19.4 21.3 21.6 Performance awards 4.2 6.3 13.6 Director awards 1.2 1.0 1.0 Total pre-tax expense 31.8 37.2 43.6 Tax benefit 6.0 6.2 15.2 Total after tax expense $ 25.8 $ 31.0 $ 28.4 Included in compensation costs are cash-settled restricted stock units of $1.4 million that are classified as a liability. Compensation costs that were capitalized in inventory were not material. Restricted Stock Units Restricted stock units have been granted to officers and certain employees of the Company and represent the right to receive unrestricted shares of Company common stock subject to continued employment through each vesting date. three-year A summary of activity with respect to restricted stock units outstanding under the Plans for the year ended December 31, 2019 was as follows: Number of Restricted Stock Units Weighted-Average Grant-Date Fair Value Non-vested at December 31, 2018 660,375 $ 58.63 Granted 468,617 49.46 Vested (314,482 ) 57.51 Forfeited (58,028 ) 52.78 Non-vested at December 31, 2019 756,482 $ 53.89 The remaining unrecognized pre-tax compensation cost related to restricted stock units at December 31, 2019 was approximately $19.2 million, and the weighted-average period of time over which this cost will be recognized is 1.8 years. The fair value of restricted stock units that vested during 2019, 2018 and 2017 was $15.2 million, $22.2 million and $20.3 million, respectively. Stock Option Awards Stock options were granted to officers and certain employees of the Company and represent the right to purchase shares of Company common stock subject to continued employment through each vesting date. Stock options granted under the Plans generally vest over a three-year All stock-based compensation to employees is required to be measured at fair value and expensed over the requisite service period. We recognize compensation expense on awards on a straight-line basis over the requisite service period for the entire award. The fair value of Fortune Brands options was estimated at the date of grant using a Black-Scholes option pricing model with the assumptions shown in the following table: 2019 2018 2017 Current expected dividend yield 1.5 % 1.3% 1.4% Expected volatility 27.0 % 24.0% 26.0% Risk-free interest rate 2.5 % 2.6% 1.9% Expected term 5 years 5 years 5.5 years The determination of expected volatility is based on a blended peer group volatility for companies in similar industries, at a similar stage of life and with similar A summary of Fortune Brands stock option activity related to Fortune Brands and former employees of Fortune Brands, Inc., the Company from which we spun off from in 2011, for the year ended December 31, 2019 was as follows: Options Weighted- Average Exercise Price Outstanding at December 31, 2018 4,023,822 $ 40.83 Granted 652,559 47.85 Exercised (760,807 ) 22.71 Expired/forfeited (90,358 ) 56.35 Outstanding at December 31, 2019 3,825,216 $ 45.27 Options outstanding and exercisable at December 31, 2019 were as follows: Options Outstanding (a) Options Exercisable (b) Range Of Exercise Prices Options Outstanding Weighted- Average Remaining Contractual Life Weighted- Average Exercise Price Options Exercisable Weighted- Average Exercise Price 13.00 to 20.00 623,901 1.7 16.74 623,901 16.74 20.01 to 65.41 3,201,315 6.6 50.83 2,044,336 48.91 3,825,216 5.8 $ 45.27 2,668,237 $ 41.39 (a) (b) The remaining unrecognized compensation cost related to unvested awards at December 31, 2019 was $4.9 million, and the weighted-average period of time over which this cost will be recognized is 1.6 years. The fair value of options that vested during the years ended December 31, 2019, 2018 and 2017 was $7.1 million, $6.7 million and $6.8 million, respectively. The intrinsic value of Fortune Brands stock options exercised in the years ended December 31, 2019, 2018 and 2017 was $26.0 million, $8.7 million and $70.6 million, respectively. Performance Awards Performance share awards were granted to officers and certain employees of the Company and represent the right to earn The following table summarizes information about Number of Performance Share Awards Weighted-Average Grant-Date Fair Value Non-vested at December 31, 2018 409,091 $ 57.50 Granted 310,471 47.77 Vested (126,700 ) 50.85 Forfeited (37,205 ) 55.74 Non-vested at December 31, 2019 555,657 $ 53.71 The remaining unrecognized pre-tax compensation cost related to performance share awards at December 31, 2019 was approximately $7.0 million, and the weighted-average period of time over which this cost will be recognized is 1.8 years. The fair value of performance share awards that vested during 2019 was $8.3 million (186,249 shares). Director Awards Stock awards are used as part of the compensation provided to outside directors under the Plan. Awards are issued annually in the second quarter. In addition, outside directors can elect to have director fees paid in stock or can elect to defer payment of stock. Compensation cost is expensed at the time of an award based on the fair value of a share at the date of the award. In 2019, 2018 and 2017, we awarded 21,746, 19,109 and 15,311 shares of Company common stock to outside directors with a weighted average fair value on the date of the award of $54.48, $54.93 and $63.43, respectively. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Revenue | 15. Revenue Our principal performance obligations are the sale of kitchen and bath cabinets, faucets and accessories, fiberglass and steel entry-door systems and locks, safes, safety, security devices and decking (collectively, “goods” or “products”). We recognize revenue for the sale of goods based on our assessment of when control transfers to our customers. For the majority of our sales, we recognize revenue at the point in time when we ship product from our facilities to our customers. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods to our customers. Payment terms on our product sales normally range from 30 to 90 days. Taxes assessed by a governmental authority that we collect are excluded from revenue. The expected costs associated with our contractual warranties will continue to be recognized as expense when the products are sold. See Note 19, “Product Warranties,” for further discussion. We record estimates to reduce revenue for customer programs and incentives, which are considered variable consideration, and include price discounts, volume-based incentives, promotions and cooperative advertising when revenue is recognized in order to determine the amount of consideration the Company will ultimately be entitled to receive. These estimates are based on historical and projected experience for each type of customer. In addition, for certain customer program incentives, we receive an identifiable benefit (goods or services) in exchange for the consideration given and record the associated expenditure in selling, general and administrative expenses. We account for shipping and handling costs that occur after the customer has obtained control of a product as a fulfillment activity (i.e., as an expense) rather than as a promised service (i.e., as a revenue element). These costs are classified within selling, general and administrative expenses. Settlement of our outstanding accounts receivable balances is normally within 30 to 90 days of the original sale transaction date. Obligations arise for us from customer rights to return our goods for any reason, including among others, product obsolescence, stock rotations, trade-in agreements for newer products and upon termination of a customer contract. We estimate future product returns at the time of sale based on historical experience and record a corresponding refund obligation, which amounted to $16.9 million and $14.8 million as of December 31, 2019 and 2018, respectively. Refund obligations are classified within other current liabilities in our consolidated balance sheet. Return assets related to the refund obligation are measured at the carrying amount of the goods at the time of sale, less any expected costs to recover the goods and any expected reduction in value. Return assets are classified within other current assets and were approximately $2.6 million and $2.3 million as of December 31, 2019 and 2018, respectively. The Company disaggregates revenue from contracts with customers into (i) major sales distribution channels in the U.S. and (ii) total sales to customers outside the U.S. market as these categories depict the nature, amount, timing and uncertainty of revenues and cash flows that are affected by economic factors. The following table disaggregates our consolidated revenue by major sales distribution channels for the years ended December 31, 2019 and 2018. (In millions) December 31, 2019 December 31, 2018 Wholesalers (a) $ 2,682.8 $ 2,607.3 Home Center retailers (b) 1,606.7 1,452.3 Other retailers (c) 304.8 311.6 Builder direct 229.4 235.4 U.S. net sales 4,823.7 4,606.6 International (d) 940.9 878.5 Net sales $ 5,764.6 $ 5,485.1 ( a ) ( b ) ( c ) ( d ) Practical Expedients Incremental costs of obtaining a contract include only those costs the Company incurs that would not have been incurred if the contract had not been obtained. These costs are required to be recognized as assets and amortized over the period that the related goods or services transfer to the customer. As a practical expedient, we expense as incurred costs to obtain a contract when the expected amortization period is one year or less. These costs are recorded within selling, general and administrative expenses. |
Defined Benefit Plans
Defined Benefit Plans | 12 Months Ended |
Dec. 31, 2019 | |
Compensation And Retirement Disclosure [Abstract] | |
Defined Benefit Plans | 16. Defined Benefit Plans We have a number of pension plans in the United States, covering many of the Company’s employees; however, the majority of these plans have been frozen to new participants and benefit accruals were frozen for active participants on December 31, 2016. The plans provide for payment of retirement benefits, mainly commencing between the ages of 55 and 65. After meeting certain qualifications, an employee acquires a vested right to future benefits. The benefits payable under the plans are generally determined on the basis of an employee’s length of service and/or earnings. Employer contributions to the plans are made, as necessary, to ensure legal funding requirements are satisfied. Also, from time to time, we may make contributions in excess of the legal funding requirements. Service cost for 2019 relates to benefit accruals in an hourly Union defined benefit plan in our Doors & Security segment, which is the only remaining plan where benefit accruals have not been frozen. Net actuarial gains and losses occur when actual experience differs from any of the assumptions used to value defined benefit plans or when assumptions change as they may each year. The primary factors contributing to actuarial gains and losses are changes in the discount rate used to value obligations as of the measurement date and the differences between expected and actual returns on pension plan assets. In addition, t he Company provides postretirement health care and life insurance benefits to certain retirees. (In millions) Pension Benefits Postretirement Benefits Obligations and Funded Status at December 31 2019 2018 2019 2018 Change in the Projected Benefit Obligation (PBO): Projected benefit obligation at beginning of year $ 763.2 $ 832.4 $ 1.4 $ 1.6 Service cost 0.4 0.5 0.2 — Interest cost 32.9 30.7 0.2 — Plan amendments — — 1.6 — Actuarial loss (gain) 121.6 (63.1 ) 1.0 (0.2 ) Benefits paid (41.0 ) (37.3 ) (0.7 ) — Curtailment gain — — (0.1 ) — Projected benefit obligation at end of year $ 877.1 $ 763.2 $ 3.6 $ 1.4 Accumulated benefit obligation at end of year (excludes the impact of future compensation increases) $ 877.1 $ 763.2 $ — $ — Change in Plan Assets: Fair value of plan assets at beginning of year $ 599.6 $ 656.6 $ — $ — Actual return on plan assets 106.8 (30.7 ) — — Employer contributions 11.8 11.0 0.7 — Benefits paid (41.0 ) (37.3 ) (0.7 ) — Fair value of plan assets at end of year $ 677.2 $ 599.6 $ — $ — Funded status (Fair value of plan assets less PBO) $ (199.9 ) $ (163.6 ) $ (3.6 ) $ (1.4 ) The actuarial loss (gain) is primarily a result of changes in discount rates from year to year. The accumulated benefit obligation exceeds the fair value of assets for all pension plans. Amounts recognized in the consolidated balance sheets consist of: Pension Benefits Postretirement Benefits (In millions) 2019 2018 2019 2018 Current benefit payment liability $ (1.4 ) $ (1.5 ) $ (0.7 ) $ (0.2 ) Accrued benefit liability (198.5 ) (162.1 ) (2.9 ) (1.2 ) Net amount recognized $ (199.9 ) $ (163.6 ) $ (3.6 ) $ (1.4 ) As of December 31, 2019, we adopted the new Society of Actuaries MP-2019 mortality tables, resulting in an immaterial increase in plan benefit obligation, and deferred actuarial losses in accumulated other comprehensive income. As of December 31, 2018, we adopted the new Society of Actuaries MP-2018 mortality tables, resulting in an immaterial decrease of our pension benefit obligation, and deferred actuarial losses in accumulated other comprehensive income. The amounts in accumulated other comprehensive loss on the consolidated balance sheets that have not yet been recognized as components of net periodic benefit cost were as follows: (In millions) Pension Benefits Postretirement Benefits Net actuarial loss at December 31, 2017 $ 67.2 $ — Recognition of actuarial (loss) gain (3.9 ) 0.1 Current year actuarial loss (gain) 8.5 (0.4 ) Net actuarial loss (gain) at December 31, 2018 $ 71.8 $ (0.3 ) Recognition of actuarial (loss) gain (34.1 ) (0.6 ) Current year actuarial loss 50.1 0.6 Net actuarial loss due to curtailment (0.1 ) — Net actuarial loss (gain) at December 31, 2019 $ 87.7 $ (0.3 ) Components of net periodic benefit cost were as follows: Components of Net Periodic Benefit (Income) Cost Pension Benefits Postretirement Benefits (In millions) 2019 2018 2017 2019 2018 2017 Service cost $ 0.4 $ 0.5 $ 0.6 $ 0.2 $ — $ — Interest cost 32.9 30.7 33.3 0.2 — — Expected return on plan assets (35.2 ) (41.0 ) (37.3 ) — — — Recognition of actuarial losses (gains) 34.1 3.9 0.9 0.6 (0.1 ) (1.4 ) Settlement/Curtailment losses (gains) 0.1 — — (0.1 ) — — Amortization of prior service credits — — — 0.2 — (5.1 ) Net periodic benefit cost (income) $ 32.3 $ (5.9 ) $ (2.5 ) $ 1.1 $ (0.1 ) $ (6.5 ) Assumptions Pension Benefits Postretirement Benefits 2019 2018 2017 2019 2018 2017 Weighted-Average Assumptions Used to Determine Benefit Obligations at December 31: Discount rate 3.3 % 4.4 % 3.8 % 6.4 % 4.2 % 3.4 % Weighted-Average Assumptions Used to Determine Net Cost for Years Ended December 31: Discount rate 4.4 % 3.8 % 4.3 % 4.2 % 3.4 % 3.4 % Expected long-term rate of return on plan assets 4.9 % 6.0 % 6.4 % — — — Postretirement Benefits 2019 2018 Assumed Health Care Cost Trend Rates Used to Determine Benefit Obligations and Net Cost at December 31: Health care cost trend rate assumed for next year 6.7/7.8 % (a) 6.9/8.0 % (a) Rate that the cost trend rate is assumed to decline (the ultimate trend rate) 4.5 % 4.5 % Year that the rate reaches the ultimate trend rate 2027 2027 (a) Plan Assets The fair value of the pension assets by major category of plan assets as of December 31, 2019 and 2018 were as follows: (In millions) Total as of balance sheet date 2019 2018 Group annuity/insurance contracts (level 3) $ 24.2 $ 23.6 Collective trusts: Cash and cash equivalents 7.8 7.7 Equity 245.3 197.7 Fixed income 355.0 324.6 Multi-strategy hedge funds 23.2 22.0 Real estate 21.7 24.0 Total $ 677.2 $ 599.6 A reconciliation of Level 3 measurements was as follows: Group annuity/ insurance contracts (In millions) 2019 2018 January 1 $ 23.6 $ 23.3 Actual return on assets related to assets still held 0.6 0.3 December 31 $ 24.2 $ 23.6 Our defined benefit plans Master Trust own a variety of investment assets. All of these investment assets, except for group annuity/insurance contracts are measured using net asset value per share as a practical expedient per ASC 820. Following the retrospective adoption of ASU 2015-07 (Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share) we excluded all investments measured using net asset value per share in the amount of $653.0 million and $576.0 million as of December 31, 2019 and 2018, respectively, from the tabular fair value hierarchy disclosure. The terms and conditions for redemptions vary for each class of the investment assets valued at net asset value per share as a practical expedient. Real estate assets may be redeemed quarterly with a 45 day redemption notice period. Investment assets in multi-strategy hedge funds may be redeemed semi-annually with a 95 day redemption notice period. Equity, fixed income and cash and cash equivalents have no specified redemption frequency and notice period and may be redeemed daily. As of December 31, 2019 we do not have an intent to sell or otherwise dispose of these investment assets at prices different than the net asset value per share. Our investment strategy is to optimize investment returns through a diversified portfolio of investments, taking into consideration underlying plan liabilities and asset volatility. The defined benefit asset allocation policy of the plans allow for an equity allocation of 0% to 75%, a fixed income allocation of 25% to 100%, a cash allocation of up to 25% and other investments of up to 20%. Asset allocations are based on the underlying liability structure. All retirement asset allocations are reviewed periodically to ensure the allocation meets the needs of the liability structure. Our 2020 expected blended long-term rate of return on plan assets of 4.9% was determined based on the nature of the plans’ investments, our current asset allocation and projected long-term rates of return from pension investment consultants. Estimated Future Retirement Benefit Payments The following retirement benefit payments are expected to be paid: (In millions) Pension Benefits Postretirement Benefits 2020 $ 41.2 $ 0.4 2021 42.4 0.4 2022 43.5 0.3 2023 44.5 0.3 2024 45.8 0.3 Years 2025-2029 239.6 2.1 Estimated future retirement benefit payments above are estimates and could change significantly based on differences between actuarial assumptions and actual events and decisions related to lump sum distribution options that are available to participants in certain plans. Defined Contribution Plan Contributions We sponsor a number of defined contribution plans. Contributions are determined under various formulas. Cash contributions by the Company related to these plans amounted to $36.3 million, $29.5 million and $29.1 million in 2019, 2018 and 2017, respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 17. Income Taxes The components of income from continuing operations before income taxes and noncontrolling interests were as follows: (In millions) 2019 2018 2017 Domestic operations $ 438.2 $ 456.7 $ 554.7 Foreign operations 137.1 80.3 80.1 Income before income taxes and noncontrolling interests $ 575.3 $ 537.0 $ 634.8 A reconciliation of income taxes at the 35% federal statutory income tax rate for 2017 and 21% for 2018 and 2019 to the income tax provision reported was as follows: (In millions) 2019 2018 2017 Income tax expense computed at federal statutory income tax rate $ 120.8 $ 112.8 $ 222.2 Other income taxes, net of federal tax benefit 18.0 13.7 13.4 Foreign taxes at a different rate than U.S. federal statutory income tax rate 1.4 3.5 (8.3 ) Tax benefit on income attributable to domestic production activities — — (10.9 ) Net adjustments for uncertain tax positions 7.5 4.1 11.6 Share-based compensation (ASU 2016-09) (3.7 ) (2.1 ) (23.9 ) Tax Act impact — 5.5 (25.7 ) Deferred tax impact of state tax rate changes 3.1 3.5 (2.0 ) Valuation allowance increase (decrease) 3.4 3.0 (5.2 ) Miscellaneous other, net (6.5 ) 3.0 (11.7 ) Income tax expense as reported $ 144.0 $ 147.0 $ 159.5 Effective income tax rate 25.0 % 27.4 % 25.1 % The 2019 and 2018 effective income tax rates were favorably impacted by a tax benefit related to share-based compensation and were unfavorably impacted by a valuation allowance increase, state and local taxes, unfavorable tax rates in foreign jurisdictions, and increases in uncertain tax positions. The 2018 effective income tax rate was also unfavorably impacted by an adjustment to the provisional net benefit recorded in 2017 under the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). The 2017 effective income tax rate was favorably impacted by the Tax Act, a tax benefit related to share-based compensation, the tax benefit attributable to the Domestic Production Activity Deduction and favorable tax rates in foreign jurisdictions, partially offset by state and local taxes and increases to uncertain tax positions. The Tax Act, enacted on December 22, 2017, made significant changes to the U.S. Internal Revenue Code including a reduction in the corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017, an exemption from federal income tax for dividends received from foreign subsidiaries and an imposition of a one-time transition tax on the deemed repatriation of cumulative foreign earnings as of December 31, 2017. A reconciliation of the beginning and ending amount of unrecognized tax benefits (“UTBs”) was as follows: (In millions) 2019 2018 2017 Unrecognized tax benefits—beginning of year $ 83.5 $ 87.5 $ 58.2 Gross additions—current year tax positions 9.2 9.1 31.0 Gross additions—prior year tax positions 2.9 9.3 10.9 Gross additions (reductions)—purchase accounting adjustments — 1.0 4.0 Gross reductions—prior year tax positions (6.9 ) (14.5 ) (9.4 ) Gross reductions—settlements with taxing authorities (0.7 ) (8.9 ) (7.2 ) Unrecognized tax benefits—end of year $ 88.0 $ 83.5 $ 87.5 The amount of UTBs that, if recognized as of December 31, 2019, would affect the Company’s effective tax rate was $72.4 million. It is reasonably possible that, within the next twelve months, total UTBs may decrease in the range of $3.1 million to $3.8 million primarily as a result of the conclusion of U.S. federal, state and foreign income tax proceedings. We classify interest and penalty accruals related to UTBs as income tax expense. In 2019, we recognized an interest and penalty expense of approximately $3.0 million. In 2018, we recognized an interest and penalty expense of approximately $2.2 million. In 2017, we recognized an interest and penalty expense of approximately $2.0 million. At December 31, 2019 and 2018, we had accruals for the payment of interest and penalties of $16.1 million and $14.4 million, respectively. We file income tax returns in the U.S., various state and foreign jurisdictions. The Company is currently under examination by the U.S. Internal Revenue Service for the periods related to 2017 and 2018, and open and subject to examination for 2016. In addition to the U.S., we have tax years that remain open and subject to examination by tax authorities in the following major taxing jurisdictions: Canada for years after 2014, Mexico for years after 2014 and China for years after 2015. Income taxes in 2019, 2018 and 2017 were as follows: (In millions) 2019 2018 2017 Current Federal $ 94.9 $ 93.5 $ 133.1 Foreign 35.1 26.4 22.4 State and other 21.5 24.1 22.8 Deferred Federal, state and other (4.4 ) 4.8 (27.2 ) Foreign (3.1 ) (1.8 ) 8.4 Total income tax expense $ 144.0 $ 147.0 $ 159.5 The components of net deferred tax assets (liabilities) as of December 31, 2019 and 2018 were as follows: (In millions) 2019 2018 Deferred tax assets: Compensation and benefits $ 37.6 $ 31.5 Defined benefit plans 50.8 39.3 Capitalized inventories 18.2 16.1 Accounts receivable 5.1 5.4 Other accrued expenses 58.8 55.2 Net operating loss and other tax carryforwards 22.4 21.2 Valuation allowance (16.8 ) (13.3 ) Miscellaneous 3.9 2.5 Total deferred tax assets 180.0 157.9 Deferred tax liabilities: Fixed assets (70.4 ) (60.2 ) Intangible assets (222.9 ) (224.6 ) Investment in partnership (7.4 ) (3.8 ) Miscellaneous (19.2 ) (20.0 ) Total deferred tax liabilities (319.9 ) (308.6 ) Net deferred tax liability $ (139.9 ) $ (150.7 ) In accordance with ASC requirements for Income Taxes, deferred taxes were classified in the consolidated balance sheets as of December 31, 2019 and 2018 as follows: (In millions) 2019 2018 Other assets 17.3 11.9 Deferred income taxes (157.2 ) (162.6 ) Net deferred tax liability $ (139.9 ) $ (150.7 ) As of December 31, 2019 and 2018, the Company had deferred tax assets relating to net operating losses, capital losses, and other tax carryforwards of $22.4 million and $21.2 million, respectively, of which approximately $7.9 million will expire between 2020 and 2024, and the remainder of which will expire in 2025 and thereafter. The Company has provided a valuation allowance to reduce the carrying value of certain of these deferred tax assets, as management has concluded that, based on the available evidence, it is more likely than not that the deferred tax assets will not be fully realized . Under the Tax Act, the accumulated foreign earnings and profits of the Company’s foreign subsidiaries as of December 31, 2017 are subject to a deemed repatriation tax and should not be subject to additional U.S. federal income tax upon an actual repatriation of those earnings. As a result, the Company has recorded an estimated tax liability of $9.7 million for foreign and state taxes that would be payable on a distribution of those earnings and profits. We have not provided for deferred taxes on the remaining book over tax outside basis differences of our foreign subsidiaries. The outside basis differences of foreign subsidiaries considered indefinitely reinvested totaled approximately $133.6 million at December 31, 2019. The associated deferred tax liability on this basis difference is less than $3 million. |
Restructuring and Other Charges
Restructuring and Other Charges | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring And Related Activities [Abstract] | |
Restructuring and Other Charges | 18. Restructuring and Other Charges Pre-tax restructuring and other charges for the year ended December 31, 2019 were as follows: Year Ended December 31, 2019 Other Charges (a) (In millions) Restructuring Charges Cost of Products Sold SG&A (b) Total Charges Cabinets $ 10.2 $ (0.1 ) $ 0.6 $ 10.7 Plumbing 2.8 2.6 2.8 8.2 Doors & Security 1.7 1.6 — 3.3 Total $ 14.7 $ 4.1 $ 3.4 $ 22.2 (a) “Other Charges” represent charges or gains directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such charges or gains may include losses on disposal of inventories, trade receivables allowances from exiting product lines, write-off of displays from exiting a customer relationship, accelerated depreciation resulting from the closure of facilities, and gains and losses on the sale of previously closed facilities. (b) Selling, general and administrative expenses Restructuring and other charges in 2019 largely related to severance costs and costs associated with closing facilities across all of our segments. Pre-tax restructuring and other charges for the year ended December 31, 2018 were as follows: Year Ended December 31, 2018 Other Charges (a) (In millions) Restructuring Charges Cost of Products Sold SG&A (b) Total Charges Cabinets $ 16.8 $ 9.1 $ 0.3 $ 26.2 Plumbing 2.6 0.6 0.1 3.3 Doors & Security 4.7 2.4 (1.2 ) 5.9 Total $ 24.1 $ 12.1 $ (0.8 ) $ 35.4 (a) “Other Charges” represent charges or gains directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such charges or gains may include losses on disposal of inventories, trade receivables allowances from exiting product lines, accelerated depreciation resulting from the closure of facilities, and gains and losses on the sale of previously closed facilities. (b) Selling, general and administrative expenses Restructuring and other charges in 2018 are largely related to our initiatives to consolidate and rationalize our manufacturing footprint and discontinue certain product lines in our Cabinets segment and severance costs within all our segments. Pre-tax restructuring and other charges for the year ended December 31, 2017 were as follows: Year Ended December 31, 2017 Other Charges (a) (In millions) Restructuring Charges Cost of Products Sold SG&A (b) Total Charges Cabinets $ 1.4 $ 1.6 $ 2.2 $ 5.2 Plumbing 2.8 — — 2.8 Doors & Security 4.1 5.6 0.8 10.5 Total $ 8.3 $ 7.2 $ 3.0 $ 18.5 (a) “Other Charges” represent charges or gains directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such charges or gains may include losses on disposal of inventories, trade receivables allowances from exiting product lines, accelerated depreciation resulting from the closure of facilities, and gains and losses on the sale of previously closed facilities. (b) Selling, general and administrative expenses Restructuring and other charges in 2017 primarily related to losses on disposal of inventory associated with exiting a product line in our Doors & Security segment and exiting a customer relationship in our Cabinets segment, as well as severance costs within all of our segments. Reconciliation of Restructuring Liability (In millions) Balance at 12/31/18 2019 Provision Cash Expenditures (a) Non-Cash Write-offs Balance at 12/31/19 Workforce reduction costs $ 9.9 $ 13.5 $ (16.6 ) $ (0.1 ) $ 6.7 Other 0.6 1.2 (1.4 ) (0.3 ) 0.1 $ 10.5 $ 14.7 $ (18.0 ) $ (0.4 ) $ 6.8 (a) (In millions) Balance at 12/31/17 2018 Provision Cash Expenditures (a) Non-Cash Write-offs Balance at 12/31/18 Workforce reduction costs $ 5.0 $ 21.4 $ (16.3 ) $ (0.2 ) $ 9.9 Other 0.8 2.7 (2.4 ) (0.5 ) 0.6 $ 5.8 $ 24.1 $ (18.7 ) $ (0.7 ) $ 10.5 ( a ) |
Commitments
Commitments | 12 Months Ended |
Dec. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments | 19. Commitments Purchase Obligations Purchase obligations of the Company as of December 31, 2019 were $408.5 million, of which $373.9 million is due within one year. Purchase obligations include contracts for raw materials and finished goods purchases, selling and administrative services, and capital expenditures. Lease Commitments Future minimum rental payments under non-cancelable operating leases as of December 31, 2018 were as follows: (In millions) 2019 $ 37.8 2020 29.6 2021 23.4 2022 18.9 2023 13.8 Remainder 58.8 Total minimum rental payments $ 182.3 Total rental expense for all operating leases (reduced by immaterial amounts from subleases) amount to $48.4 million and $42.1 million in 2018 and 2017, respectively. These expenses and minimum rental payments were determined in accordance with the previous leasing guidance (ASC 840). Accordingly, the minimum payments exclude optional lease payments that we can avoid. The minimum lease payments as of December 31, 2019, disclosed in Note 7, are determined in accordance with the new leasing guidance (ASC 842), which include optional lease payments if we are reasonably certain to incur them. Product Warranties We generally record warranty expense related to contractual warranty terms at the time of sale. We may also provide customer concessions for claims made outside of the contractual warranty terms and those expenses are recorded in the period in which the concession is made. We offer our customers various warranty terms based on the type of product that is sold. Warranty expense is determined based on historic claim experience and the nature of the product category. The following table summarizes activity related to our product warranty liability for the years ended December 31, 2019, 2018 and 2017. (In millions) 2019 2018 2017 Reserve balance at the beginning of the year $ 24.9 $ 17.2 $ 16.2 Provision for warranties issued 25.4 25.1 25.1 Settlements made (in cash or in kind) (25.8 ) (25.7 ) (24.3 ) Acquisition — 8.9 — Foreign currency 0.2 (0.6 ) 0.2 Reserve balance at end of year $ 24.7 $ 24.9 $ 17.2 |
Information on Business Segment
Information on Business Segments | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Information on Business Segments | 20. Information on Business Segments We report our operating segments based on how operating results are regularly reviewed by our chief operating decision maker for making decisions about resource allocations to segments and assessing performance. The Company’s operating segments and types of products from which each segment derives revenues are described below. The Cabinets segment includes custom, semi-custom and stock cabinetry for the kitchen, bath and other parts of the home under brand names including Aristokraft, Diamond, Mid-Continent, Kitchen Craft, Homecrest, Omega, StarMark, Ultracraft, Kemper, Schrock, Decora and Mantra actuarial gains and losses arising from the periodic remeasurement of our liabilities. Corporate The Company’s subsidiaries operate principally in the United States, Canada, Mexico, China and Western Europe. (In millions) 2019 2018 2017 Net sales: Cabinets $ 2,388.5 $ 2,418.6 $ 2,467.1 Plumbing 2,027.2 1,883.3 1,720.8 Doors & Security 1,348.9 1,183.2 1,095.4 Net sales $ 5,764.6 $ 5,485.1 $ 5,283.3 Net sales to two of the Company’s customers, The Home Depot, Inc. (“The Home Depot”) and Lowe’s Companies, Inc. (“Lowe’s”) each accounted for greater than 10% of the Company’s net sales in 2019, 2018 and 2017. All segments sell to both The Home Depot and Lowe’s. Net sales to The Home Depot were 14%, 13% and 13% of net sales in 2019, 2018 and 2017, respectively. Net sales to Lowe’s were 14%, 14% and 14% of net sales in 2019, 2018 and 2017, respectively. (In millions) 2019 2018 2017 Operating income: Cabinets $ 178.3 $ 143.5 $ 267.2 Plumbing 427.6 375.3 358.5 Doors & Security 172.3 155.6 146.9 Less: Corporate expenses (a) (79.7 ) (79.2 ) (90.1 ) Operating income $ 698.5 $ 595.2 $ 682.5 (a) Below is a table detailing Corporate expenses: General and administrative expense $ (79.7 ) $ (79.2 ) $ (85.0 ) Long-lived asset impairment — — (5.1 ) Total Corporate expenses $ (79.7 ) $ (79.2 ) $ (90.1 ) (In millions) 2019 2018 2017 Total assets: Cabinets $ 2,355.7 $ 2,318.7 $ 2,416.3 Plumbing 2,110.8 1,943.1 1,854.1 Doors & Security 1,596.6 1,526.0 1,032.2 Corporate 228.2 176.8 208.8 Total assets $ 6,291.3 $ 5,964.6 $ 5,511.4 Depreciation expense: Cabinets $ 44.3 $ 50.9 $ 42.8 Plumbing 32.0 29.1 26.9 Doors & Security 32.3 30.2 25.9 Corporate 2.7 3.3 3.0 Depreciation expense $ 111.3 $ 113.5 $ 98.6 Amortization of intangible assets: Cabinets $ 17.8 $ 19.6 $ 19.7 Plumbing 10.3 10.4 7.7 Doors & Security 13.3 6.1 4.3 Amortization of intangible assets $ 41.4 $ 36.1 $ 31.7 Capital expenditures: Cabinets $ 30.9 $ 73.8 $ 63.4 Plumbing 35.7 41.4 43.5 Doors & Security 63.6 34.3 40.1 Corporate 1.6 0.6 18.0 Capital expenditures, gross 131.8 150.1 165.0 Less: proceeds from disposition of assets (4.2 ) (6.1 ) (0.4 ) Capital expenditures, net $ 127.6 $ 144.0 $ 164.6 Net sales by geographic region (a) United States $ 4,823.7 $ 4,606.6 $ 4,492.2 Canada 401.0 433.1 427.6 China 355.4 260.6 202.3 Other international 184.5 184.8 161.2 Net sales $ 5,764.6 $ 5,485.1 $ 5,283.3 Property, plant and equipment, net: United States $ 641.9 $ 628.9 $ 562.3 Mexico 103.2 103.4 89.0 Canada 43.9 46.0 50.5 China 22.5 22.5 24.8 Other international 12.7 12.6 13.4 Property, plant and equipment, net $ 824.2 $ 813.4 $ 740.0 (a) Based on country of destination |
Quarterly Financial Data
Quarterly Financial Data | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data | 21. Quarterly Financial Data Unaudited (In millions, except per share amounts) 2019 1 st 2 nd 3 rd 4 th Full Year Net sales $ 1,327.9 $ 1,507.2 $ 1,459.0 $ 1,470.5 $ 5,764.6 Gross profit 458.8 537.6 524.2 531.8 2,052.4 Operating income 135.6 202.4 168.0 192.5 698.5 Income from continuing operations, net of tax 84.5 137.1 105.7 104.0 431.3 Income (loss) from discontinued operations, net of tax — — — — — Net income 84.5 137.1 105.7 104.0 431.3 Net income attributable to Fortune Brands 84.7 137.5 105.6 104.1 431.9 Basic earnings (loss) per common share Continuing operations 0.60 0.98 0.76 0.75 3.09 Discontinued operations — — — — — Net income attributable to Fortune Brands 0.60 0.98 0.76 0.75 3.09 Diluted earnings (loss) per common share Continuing operations 0.60 0.97 0.75 0.74 3.06 Discontinued operations — — — — — Net income attributable to Fortune Brands 0.60 0.97 0.75 0.74 3.06 2018 1 st 2 nd 3 rd 4 th Full Year Net sales $ 1,254.6 $ 1,429.0 $ 1,380.8 $ 1,420.7 $ 5,485.1 Gross profit 439.6 524.1 493.9 501.8 1,959.4 Operating income 119.4 188.6 147.1 140.1 595.2 Income from continuing operations, net of tax 75.1 129.7 99.9 85.3 390.0 Income (loss) from discontinued operations, net of tax (0.2 ) — — — (0.2 ) Net income 74.9 129.7 99.9 85.3 389.8 Net income attributable to Fortune Brands 75.0 129.6 99.8 85.2 389.6 Basic earnings (loss) per common share Continuing operations 0.50 0.89 0.70 0.60 2.69 Discontinued operations — — — — — Net income attributable to Fortune Brands 0.50 0.89 0.70 0.60 2.69 Diluted earnings (loss) per common share Continuing operations 0.49 0.88 0.69 0.60 2.66 Discontinued operations — — — — — Net income attributable to Fortune Brands 0.49 0.88 0.69 0.60 2.66 In 2019, we recorded pre-tax defined benefit plan actuarial loss of $34.1 million—$2.1 million of actuarial loss ($1.6 million after tax) in the third quarter and $32.0 million of actuarial losses ($24.2 In 2018, we recorded pre-tax defined benefit plan actuarial loss of $3.8 million—$0.3 million of actuarial loss ($0.2 million after tax) in the third quarter and $3.5 million of actuarial losses ($2.8 million after tax) in the fourth quarter. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 22. Earnings Per Share The computations of earnings (loss) per common share were as follows: (In millions, except per share data) 2019 2018 2017 Income from continuing operations, net of tax $ 431.3 $ 390.0 $ 475.3 Less: Noncontrolling interests (0.6 ) 0.2 0.1 Income from continuing operations for EPS 431.9 389.8 475.2 Income (loss) from discontinued operations — (0.2 ) (2.6 ) Net income attributable to Fortune Brands $ 431.9 $ 389.6 $ 472.6 Earnings (loss) per common share Basic Continuing operations $ 3.09 $ 2.69 $ 3.10 Discontinued operations — — (0.02 ) Net income attributable to Fortune Brands common stockholders $ 3.09 $ 2.69 $ 3.08 Diluted Continuing operations $ 3.06 $ 2.66 $ 3.05 Discontinued operations — — (0.02 ) Net income attributable to Fortune Brands common stockholders $ 3.06 $ 2.66 $ 3.03 Basic average shares outstanding (a) 139.9 144.6 153.2 Stock-based awards 1.4 1.8 2.6 Diluted average shares outstanding (a) 141.3 146.4 155.8 Antidilutive stock-based awards excluded from weighted-average number of shares outstanding for diluted earnings per share 1.8 1.5 0.5 (a) Reflects the impact of share repurchases during the years ended December 31, 2019, 2018 and 2017, respectively. |
Other Expense (Income), Net
Other Expense (Income), Net | 12 Months Ended |
Dec. 31, 2019 | |
Other Income And Expenses [Abstract] | |
Other Expense (Income), Net | 23. Other Expense (Income), Net The components of other expense (income), net for the years ended December 31, 2019, 2018 and 2017 were as follows: (In millions) 2019 2018 2017 Defined benefit plan $ 31.9 $ (6.5 ) $ (9.6 ) Asset impairment charge — — 7.0 Foreign currency (gains)/losses (0.7 ) (2.0 ) 0.9 Ineffective portion of cash flow hedge — (3.8 ) — Other items, net (2.2 ) (4.0 ) — Total other expense (income), net $ 29.0 $ (16.3 ) $ (1.7 ) In January 2019, During 2017, we recorded an impairment charge of $7.0 million pertaining to a cost method investment in a development stage home products company due to an other-than-temporary decline in its fair value. As a result of the impairment, the carrying value of the investment was reduced to zero and the Company is not subject to further impairment or funding obligations with regard to this investment. |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Loss Contingency [Abstract] | |
Contingencies | 24. Contingencies Litigation The Company is a defendant in lawsuits that are ordinary routine litigation matters incidental to its businesses. It is not possible to predict the outcome of the pending actions, and, as with any litigation, it is possible that these actions could be decided unfavorably to the Company. The Company believes that there are meritorious defenses to these actions and that these actions will not have a material adverse effect upon the Company’s results of operations, cash flows or financial condition, and, where appropriate, these actions are being vigorously contested. Accordingly, the Company believes the likelihood of material loss is remote. Environmental Compliance with federal, state and local laws regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment, did not have a material effect on capital expenditures, earnings or the competitive position of Fortune Brands. We are involved in remediation activities to clean up hazardous wastes as required by federal and state laws. Liabilities for remediation costs of each site are based on our best estimate of undiscounted future costs, excluding possible insurance recoveries or recoveries from other third parties. Uncertainties about the status of laws, regulations, technology and information related to individual sites make it difficult to develop estimates of future environmental remediation exposures. Some of the potential liabilities relate to sites we own, and some relate to sites we no longer own or never owned. Several of our subsidiaries have been designated as potentially responsible parties (“PRP”) under “Superfund” or similar state laws. As of December 31, 2019, ten such instances have not been dismissed, settled or otherwise resolved. In 2019, none of our subsidiaries were identified as a PRP in a new instance and no instances were settled, dismissed or otherwise resolved. In most instances where our subsidiaries are named as a PRP, we enter into cost-sharing arrangements with other PRPs. We give notice to insurance carriers of potential PRP liability, but very rarely, if ever, receive reimbursement from insurance for PRP costs. We believe that the cost of complying with the present environmental protection laws, before considering estimated recoveries either from other PRPs or insurance, will not have a material adverse effect on our results of operations, cash flows or financial condition. At December 31, 2019 and 2018, we had accruals of $0.2 and $0.6 million, respectively, relating to environmental compliance and cleanup including, but not limited to, the above mentioned Superfund sites. |
Schedule II Valuation and Quali
Schedule II Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2019 | |
Valuation And Qualifying Accounts [Abstract] | |
Schedule II Valuation and Qualifying Accounts | Schedule II Valuation and Qualifying Accounts For the years ended December 31, 2019, 2018 and 2017 (In millions) Balance at Beginning of Period Charged to Expense Reclassifications (c) Write-offs and Deductions (a) Business Acquisition (b) Balance at End of Period 2019: Allowance for cash discounts and sales allowances $ 84.6 $ 198.6 $ — $ 186.3 $ — $ 96.9 Allowance for doubtful accounts 3.7 1.6 — 2.3 — 3.0 Allowance for deferred tax assets 13.3 3.5 — — — 16.8 2018: Allowance for cash discounts and sales allowances $ 84.0 $ 216.1 $ (16.0 ) $ 199.5 $ — $ 84.6 Allowance for doubtful accounts 3.3 1.5 — 1.4 0.3 3.7 Allowance for deferred tax assets 11.0 2.3 — — — 13.3 2017: Allowance for cash discounts, returns and sales allowances $ 68.2 $ 205.7 $ 3.0 $ 192.9 $ — $ 84.0 Allowance for doubtful accounts 7.4 0.2 — 4.5 0.2 3.3 Allowance for deferred tax assets 16.4 (5.4 ) — — — 11.0 (a) (b) (c) |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The presentation of financial statements in accordance with U.S. generally accepted accounting principles (“GAAP”) requires us to make estimates and assumptions that affect reported amounts and related disclosures. Actual results in future periods could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Highly liquid investments with an original maturity of three months or less are included in cash and cash equivalents. |
Allowances for Doubtful Accounts | Allowances for Doubtful Accounts Trade receivables are recorded at the stated amount, less allowances for discounts and doubtful accounts. The allowances for doubtful accounts represent estimated uncollectible receivables associated with potential customer defaults on contractual obligations (usually due to customers’ potential insolvency) or discounts related to early payment of accounts receivables by our customers. The allowances include provisions for certain customers where a risk of default has been specifically identified. In addition, the allowances include a provision for customer defaults on a general formula basis when it is determined that the risk of some default is probable and estimable, but cannot yet be associated with specific customers. The assessment of the likelihood of customer defaults is based on various factors, including the length of time the receivables are past due, historical collection experience and existing economic conditions. In accordance with this policy, our allowance for doubtful accounts was $3.0 million and $3.7 million as of December 31, 2019 and 2018, respectively. |
Inventories | Inventories Inventory provisions are recorded to reduce inventory to the net realizable dollar value for obsolete or slow moving inventory based on assumptions about future demand and marketability of products, the impact of new product introductions, inventory levels and turns, product spoilage and specific identification of items, such as product discontinuance, engineering/material changes, or regulatory-related changes. During the fourth quarter of 2018, we determined that it was preferable to change our accounting policy from last-in, first-out (“LIFO”) to FIFO for product groups in which metals comprise a significant portion of inventory cost. We believe this change is preferable because it results in a uniform method to value our inventory across all our segments, improves comparability with our peers, and is expected to better reflect the current value of inventory on the consolidated balance sheets. The change in costing method, which affected our Plumbing and Doors & Security segments, was recognized during the fourth quarter of 2018, by adjusting the cost of inventories to FIFO, resulting in a pretax benefit of approximately $7.3 million ($5.5 million after tax) to Cost of products sold in the consolidated statements of income for the year ended December 31, 2018. The impact of this change was not material to our 2017 results of operations and therefore we did not retrospectively apply the change in accounting policy. There were no inventories valued using LIFO as of December 31, 2019 or 2018. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are carried at cost. Depreciation is provided, principally on a straight-line basis, over the estimated useful lives of the assets. Gains or losses resulting from dispositions are included in operating income. Betterments and renewals, which improve and extend the life of an asset, are capitalized; maintenance and repair costs are expensed as incurred. Assets held for use to be disposed of at a future date are depreciated over the remaining useful life. Assets to be sold are written down to fair value less costs to sell at the time the assets are being actively marketed for sale. Estimated useful lives of the related assets are as follows: Buildings and leasehold improvements 15 to 40 years Machinery and equipment 3 to 15 years Software 3 to 7 years |
Long-lived Assets | Long-lived Assets In accordance with ASC requirements for Property, Plant and Equipment, a long-lived asset (including amortizable identifiable intangible assets) or asset group held for use is tested for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. When such events occur, we compare the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset or asset group to the carrying amount of a long-lived asset or asset group. The cash flows are based on our best estimate of future cash flows derived from the most recent business projections. If this comparison indicates that there is an impairment, the amount of the impairment is calculated based on fair value. Fair value is estimated primarily using discounted expected future cash flows on a market-participant basis. During 2019, we recorded an impairment of $1.7 million related to a long-lived asset to be disposed of in cost of products sold. No impairments of long-lived assets were recorded during 2018. During 2017, we recorded an impairment of $5.1 million related to a long-lived asset to be disposed of in selling, general and administrative expenses. |
Leases | Leases Operating lease assets and operating lease liabilities are recognized based on the present value of the future lease payments over the lease term at commencement date. As most of our lease contracts do not provide an explicit interest rate, we use our incremental borrowing rate in determining the present value of future lease payments. Our incremental borrowing rates include estimates related to the impact of collateralization and the economic environment where the leased asset is located. The operating lease assets also include any prepaid lease payments and initial direct costs incurred, but exclude lease incentives received at lease commencement. Our lease terms include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Our leases have remaining lease terms of 1 to 36 years, some of which may include options to extend or terminate the lease. Operating lease expense is recognized on a straight-line basis over the lease term. We do not recognize leases with an initial term of twelve months or less on the balance sheet and instead recognize the related lease payments as expense in the statement of comprehensive income on a straight-line basis over the lease term. We account for lease and non-lease components as a single lease component for all asset classes. Additionally, for certain equipment leases, we apply a portfolio approach and account for multiple lease components as a single lease component. Certain of our lease agreements include variable rental payments, including rental payments adjusted periodically for inflation. Variable rental payments are expensed during the period they are incurred and therefore are excluded from our lease assets and liabilities. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. |
Goodwill and Indefinite-lived Intangible Assets | Goodwill and Indefinite-lived Intangible Assets In accordance with ASC requirements for Intangibles—Goodwill and Other, goodwill is tested for impairment at least annually in the fourth quarter, and written down when impaired. An interim impairment test is performed if an event occurs or conditions change that would more likely than not reduce the fair value of the reporting unit below the carrying value. To evaluate the recoverability of goodwill, we first assess qualitative factors to determine whether it is more likely than not that goodwill is impaired. Qualitative factors include changes in volume, margin, customers and the industry. If it is deemed more likely than not that goodwill for a reporting unit is impaired, we will perform a quantitative impairment test using a weighting of the income and market approaches. For the income approach, we use a discounted cash flow model, estimating the future cash flows of the reporting units to which the goodwill relates and then discounting the future cash flows at a market-participant-based discount rate. In determining the estimated future cash flows, we consider current and projected future levels of income based on management’s plans for that business; business trends, prospects and market and economic conditions; and market-participant considerations. Furthermore, our cash flow projections used to assess impairment of our goodwill and other intangible assets are significantly influenced by our projection for the U.S. home products market, our annual operating plans finalized in the fourth quarter of each year, and our ability to execute on various planned cost reduction initiatives supporting operating income improvements. Our projection for the U.S. home products market is inherently uncertain and is subject to a number of factors, such as employment, home prices, credit availability, new home starts and the rate of home foreclosures. For the market approach, we apply market multiples for peer groups to the current operating results of the reporting units to determine each reporting unit’s fair value. The Company’s reporting units are operating segments, or one level below operating segments when appropriate. When the estimated fair value of a reporting unit is less than its carrying value, we measure and recognize the amount of the goodwill impairment loss based on that difference. The significant assumptions that are used to determine the estimated fair value for goodwill impairment testing include the following: third-party market forecasts of U.S. new home starts and home repair and remodel spending; management’s sales, operating income and cash flow forecasts; peer company EBITDA earnings multiples; the market-participant-based discount rate; and the perpetuity growth rate. Our estimates of reporting unit fair values are based on certain assumptions that may differ from our historical and future actual operating performance. Specifically, assumptions related to growth in the new construction and repair and remodel segments of the U.S. home products markets drive our forecasted sales growth. The market forecasts are developed using independent third-party forecasts from multiple sources. In addition, estimated future operating income and cash flow consider our historical performance at similar levels of sales volume and management’s future operating plans as reflected in annual and long-term plans that are reviewed and approved by management. Purchased intangible assets other than goodwill are amortized over their useful lives unless those lives are determined to be indefinite. The determination of the useful life of an intangible asset other than goodwill is based on factors including historical tradename performance with respect to consumer name recognition, geographic market presence, market share, plans for ongoing tradename support and promotion, customer attrition rates, and other relevant factors. Certain of our tradenames have been assigned an indefinite life as we currently anticipate that these tradenames will contribute cash flows to the Company indefinitely. Indefinite-lived intangible assets are not amortized, but are evaluated at least annually to determine whether the indefinite useful life is appropriate. We measure the fair value of identifiable intangible assets upon acquisition and we review for impairment annually in the fourth quarter and whenever market or business events indicate there may be a potential impairment of that intangible. Impairment losses are recorded to the extent that the carrying value of the indefinite-lived intangible asset exceeds its fair value. The significant assumptions that are used to determine the estimated fair value for indefinite-lived intangible assets upon acquisition and subsequent impairment testing are forecasted revenue growth rates; the assumed royalty rate; and the market-participant discount rate. We measure fair value of our indefinite-lived tradenames using the standard relief-from-royalty approach which estimates the present value of royalty income that could be hypothetically earned by licensing the brand name to a third party over the remaining useful life. The determination of fair value using this technique requires the use of estimates and assumptions related to forecasted revenue growth rates, the assumed royalty rate and the market-participant discount rate. We first assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired. Qualitative factors include changes in volume, customers and the industry. If it is deemed more likely than not that an intangible asset is impaired, we will perform a quantitative impairment test. |
Equity securities | Investments in Equity Securities In accordance with ASC requirements for Investments – equity securities, we account for non-controlling investments in equity securities at fair value, with any gains or losses recognized through other income and expense. Equity securities without readily determinable fair values are recorded at cost minus impairment, plus or minus any changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. During the fourth quarter of 2018, our Plumbing segment entered into strategic partnerships with several companies who incorporate technology into plumbing-related products, and at the same time acquired non-controlling equity interests in some of our partners. This includes an investment in Flo Technologies, Inc. (“Flo”), a U.S. manufacturer of a comprehensive water monitoring and shut-off system with leak detection and proactive leak detection technologies. In January 2020, we reached an agreement to acquire 100% of Flo’s outstanding shares in a multi-phase transaction. In January 2020, we acquired additional shares in exchange for $52.1 million in cash, including direct transaction costs, which combined with our existing investment resulted in majority ownership of the outstanding shares. From January 2020, we will apply the equity method of accounting to our investment in Flo as the minority shareholders have substantive participating rights which preclude consolidation in our results of operations and statements of financial position and cash flows. The substantive participating rights are due to expire in the first quarter of 2021, at which time we will obtain control of, and begin consolidating, Flo in our results. The second phase, scheduled to occur in the first quarter of 2022, will result in the acquisition of the remaining outstanding shares of Flo for a price based on Flo’s 2021 sales and earnings. As of December 31, 2019, all of our investments in our strategic partners do not have readily determinable fair values. As of December 31, 2019 and 2018, the carrying value of our investments was $29.2 million and $28.7 million, respectively, which is included in other assets within our Consolidated Balance Sheet. |
Defined Benefit Plans | Defined Benefit Plans We have a number of pension plans in the United States, covering many of the Company’s employees. In addition, the Company provides postretirement health care and life insurance benefits to certain retirees. Service cost for 2019 relates to benefit accruals in an hourly Union defined benefit plan in our Doors & Security segment. Benefit accruals under all other defined benefit pension plans were frozen as of December 31, 2016. We record amounts relating to these plans based on calculations in accordance with ASC requirements for Compensation – Retirement Benefits, which include various actuarial assumptions, including discount rates, assumed rates of return, compensation increases, turnover rates and health care cost trend rates. We recognize changes in the fair value of pension plan assets and net actuarial gains or losses in excess of 10 percent of the greater of the fair value of pension plan assets or each plan’s projected benefit obligation (the “corridor”) in earnings immediately upon remeasurement, which is at least annually in the fourth quarter of each year. We review our actuarial assumptions on an annual basis and make modifications to the assumptions based on current economic conditions and trends. The discount rate used to measure obligations is based on a spot-rate yield curve on a plan-by-plan basis that matches projected future benefit payments with the appropriate interest rate applicable to the timing of the projected future benefit payments. The expected rate of return on plan assets is determined based on the nature of the plans’ investments, our current asset allocation and our expectations for long-term rates of return. Compensation increases reflect expected future compensation trends. For postretirement benefits, our health care trend rate assumption is based on historical cost increases and expectations for long-term increases. The cost or benefit of plan changes, such as increasing or decreasing benefits for prior employee service (prior service cost), is deferred and included in expense on a straight-line basis over the average remaining service period of the related employees. We believe that the assumptions utilized in recording obligations under our plans, which are presented in Note 16, “Defined Benefit Plans,” are reasonable based on our experience and on advice from our independent actuaries; however, differences in actual experience or changes in the assumptions may materially affect our financial position and results of operations. We will continue to monitor these assumptions as market conditions warrant. |
Insurance Reserves | Insurance Reserves We provide for expenses associated with workers’ compensation and product liability obligations when such amounts are probable and can be reasonably estimated. The accruals are adjusted as new information develops or circumstances change that would affect the estimated liability. |
Litigation Contingencies | Litigation Contingencies Our businesses are subject to risks related to threatened or pending litigation and are routinely defendants in lawsuits associated with the normal conduct of business. Liabilities and costs associated with litigation-related loss contingencies require estimates and judgments based on our knowledge of the facts and circumstances surrounding each matter and the advice of our legal counsel. We record liabilities for litigation-related losses when a loss is probable and we can reasonably estimate the amount of the loss in accordance with ASC requirements for Contingencies. We evaluate the measurement of recorded liabilities each reporting period based on the then-current facts and circumstances specific to each matter. The ultimate losses incurred upon final resolution of litigation-related loss contingencies may differ materially from the estimated liability recorded at any particular balance sheet date. Changes in estimates are recorded in earnings in the period in which such changes occur. |
Income Taxes | Income Taxes In accordance with ASC requirements for Income Taxes, we establish deferred tax liabilities or assets for temporary differences between financial and tax reporting bases and subsequently adjust them to reflect changes in tax rates expected to be in effect when the temporary differences reverse. We record a valuation allowance reducing deferred tax assets when it is more likely than not that such assets will not be realized. We record liabilities for uncertain income tax positions based on a two-step process. The first step is recognition, where we evaluate whether an individual tax position has a likelihood of greater than 50% of being sustained upon examination based on the technical merits of the position, including resolution of any related appeals or litigation processes. For tax positions that are currently estimated to have a less than 50% likelihood of being sustained, no tax benefit is recorded. For tax positions that have met the recognition threshold in the first step, we perform the second step of measuring the benefit to be recorded. The actual benefits ultimately realized may differ from our estimates. In future periods, changes in facts, circumstances, and new information may require us to change the recognition and measurement estimates with regard to individual tax positions. Changes in recognition and measurement estimates are recorded in the consolidated statement of income and consolidated balance sheet in the period in which such changes occur. As of December 31, 2019, we had liabilities for unrecognized tax benefits pertaining to uncertain tax positions totaling $88.0 million. It is reasonably possible that the unrecognized tax benefits may decrease in the range of $3.1 million to $3.8 million in the next 12 months primarily as a result of the conclusion of U.S. federal, state and foreign income tax proceedings. The Tax Act, enacted on December 22, 2017, made significant changes to the U.S. Internal Revenue Code including a reduction in the corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017, an exemption from federal income tax for dividends received from foreign subsidiaries, and an imposition of a one-time transition tax on the deemed repatriation of cumulative foreign earnings and profits as of December 31, 2017. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue for the sale of goods based on its assessment of when control transfers to our customers. Refer to Note 15 for additional information. |
Cost of Products Sold | Cost of Products Sold Cost of products sold includes all costs to make products saleable, such as labor costs, inbound freight, purchasing and receiving costs, inspection costs and internal transfer costs. In addition, all depreciation expense associated with assets used to manufacture products and make them saleable is included in cost of products sold. |
Customer Program Costs | Customer Program Costs Customer programs and incentives are a common practice in our businesses. Our businesses incur customer program costs to obtain favorable product placement, to promote sales of products and to maintain competitive pricing. We record estimates to reduce revenue for customer programs and incentives, which are considered variable consideration, and include price discounts, volume-based incentives, promotions and cooperative advertising when revenue is recognized in order to determine the amount of consideration the Company will ultimately be entitled to receive. These estimates are based on historical and projected experience for each type of customer. In addition, for certain customer program incentives, we receive an identifiable benefit (goods or services) in exchange for the consideration given and record the associated expenditure in selling, general and administrative expenses. Volume allowances are accrued based on management’s estimates of customer volume achievement and other factors incorporated into customer agreements, such as new products, store sell-through, merchandising support, levels of returns and customer training. Management periodically reviews accruals for these rebates and allowances, and adjusts accruals when circumstances indicate (typically as a result of a change in volume expectations). The costs typically recognized in “selling, general and administrative expenses” include product displays, point of sale materials and media production costs. The costs typically recognized in selling, general and administrative expenses include product displays, point of sale materials and media production costs. The costs included in the selling, general and administrative expenses category were $66.3 million, $66.5 million and $62.4 million for the years ended December 31, 2019, 2018 and 2017, respectively. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative expenses include advertising costs; marketing costs; selling costs, including commissions; research and development costs; shipping and handling costs, including warehousing costs; and general and administrative expenses. Shipping and handling costs included in selling, general and administrative expenses were $225.5 million, $215.9 million and $204.7 million in 2019, 2018 and 2017, respectively . Advertising costs, which amounted to $251.7 million, $243.6 million and $233.2 million in 2019, 2018 and 2017, respectively, are principally expensed as incurred. Advertising costs paid to customers as pricing rebates include product displays, marketing administration costs, media production costs and point of sale materials. Advertising costs recorded as a reduction to net sales, primarily cooperative advertising, were $74.0 million, $72.4 million and $65.6 million in 2019, 2018 and 2017, respectively. Advertising costs recorded in selling, general and administrative expenses were $177.7 million, $171.2 million and $167.6 million in 2019, 2018 and 2017, respectively. Research and development expenses include product development, product improvement, product engineering and process improvement costs. Research and development expenses, which were $48.2 million, $50.3 million and $50.7 million in 2019, 2018 and 2017, respectively, are expensed as incurred. |
Stock-based Compensation | Stock-based Compensation Stock-based compensation expense, measured as the fair value of an award on the date of grant, is recognized in the financial statements over the period that an employee is required to provide services in exchange for the award. The fair value of each option award is measured on the date of grant using the Black-Scholes option-pricing model. The fair value of each performance share award is based on the average of the high and low share prices on the date of grant and the probability of meeting performance targets. The fair value of each restricted stock unit granted is equal to the average of the high and low share prices on the date of grant. See Note 14, “Stock-Based Compensation,” for additional information. |
Earnings Per Share | Earnings Per Share Earnings per common share is calculated by dividing net income attributable to Fortune Brands by the weighted-average number of shares of common stock outstanding during the year. Diluted earnings per common share include the impact of all potentially dilutive securities outstanding during the year. See Note 22, “Earnings Per Share,” for further discussion. |
Foreign Currency Translation | Foreign Currency Translation Foreign currency balance sheet accounts are translated into U.S. dollars at the actual rates of exchange at the balance sheet date. Income and expenses are translated at the average rates of exchange in effect during the period for the foreign subsidiaries where the local currency is the functional currency. The related translation adjustments are made directly to a separate component of the “accumulated other comprehensive income” (“AOCI”) caption in equity. Transactions denominated in a currency other than the functional currency of a subsidiary are translated into functional currency with resulting transaction gains or losses recorded in other expense, net. |
Derivative Financial Instruments | Derivative Financial Instruments In accordance with ASC requirements for Derivatives and Hedging, we recognize all derivative contracts as either assets or liabilities on the balance sheet, and the measurement of those instruments is at fair value. If the derivative is designated as a fair value hedge and is effective, the changes in the fair value of the derivative and of the hedged item attributable to the hedged risk are recognized in earnings in the same period. If the derivative is designated as a cash flow hedge, the changes in the fair value of the derivative are recorded in other comprehensive income (“OCI”) and are recognized in the consolidated statement of income when the hedged item affects earnings. If the derivative is designated as an effective economic hedge of the net investment in a foreign operation, the changes in the fair value of the derivative is reported in the cumulative translation adjustment section of OCI. Similar to foreign currency translation adjustments, these changes in fair value are recognized in earnings only when realized upon sale or upon complete or substantially complete liquidation of the investment in the foreign entity. Deferred currency gains of $4.1 million, $2.2 million and $0.4 million (before tax impact) were reclassified into earnings for the year ended December 31, 2019, 2018 and 2017, respectively. Based on foreign exchange rates as of December 31, 2019, we estimate that $2.3 million of net derivative gain included in AOCI as of December 31, 2019 will be reclassified to earnings within the next twelve months. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards Leases In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, which requires lessees to recognize almost all leases on their balance sheet as “right-of-use” assets and lease liabilities but recognize related expenses in a manner similar to previous accounting guidance. The guidance also eliminates previous real estate-specific provisions for all entities. In January 2018, the FASB issued ASU 2018-01, which clarifies the application of the new leases guidance to land easements. In July 2018, the FASB issued ASU 2018-10 and ASU 2018-11, which clarify certain guidance included in ASU 2016-02 and introduces a new optional transition method, which does not require revisions to comparative periods. We adopted this standard as of January 1, 2019 using the transition method introduced by ASU 2018-11, which does not require revisions to comparative periods. We elected to implement the transition package of practical expedients permitted within the new standard, which among other things, allows us to carryforward the historical lease classification. In addition, we elected the hindsight practical expedient to determine the lease term for existing leases. Adoption of the new standard resulted in the recording of lease assets and lease liabilities of approximately $177.2 million and $182.6 million, respectively, as of January 1, 2019. The difference between the lease assets and lease liabilities primarily relates to accrued rent and unamortized lease incentives recorded in accordance with the previous leasing guidance. The new standard did not materially impact our consolidated statements of income or cash flows. Improvements to Accounting for Hedging Activities In August 2017, the FASB issued ASU 2017-12, which amends the current hedge accounting model. The new standard eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item (which is consistent with our prior practice). The change in fair value for qualifying cash flow and net investment hedges is included in other comprehensive loss (until they are reclassified into the income statement). The standard also eased certain documentation and assessment requirements and modified the accounting for components excluded from the assessment of hedge effectiveness. We adopted this standard as of January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In February 2018, the FASB issued ASU 2018-02, which permits companies to reclassify to retained earnings the tax effects stranded in accumulated other comprehensive income (“AOCI”) as a result of the U.S. Tax Cuts and Jobs Act of 2017. We adopted this standard on January 1, 2019, which resulted in a reclassification of $8.6 million between accumulated other comprehensive loss and retained earnings in our consolidated statement of equity. Improvements to Nonemployee Share-Based Payment Accounting In June 2018, the FASB issued ASU 2018-07, which simplifies the accounting for share-based arrangements with nonemployees. The new guidance generally aligns the accounting for share-based awards to nonemployees with the guidance for share-based awards to employees. The guidance was effective for the Company’s fiscal year beginning January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. Codification Improvements In July 2018, the FASB issued ASU 2018-09, which includes technical corrections, clarifications, and other minor improvements to various areas including business combinations, fair value measurements and hedging. The transition and effective date guidance is based on the facts and circumstances of each amendment. Some of the amendments in this standard were effective immediately, while others were effective for the Company’s fiscal year beginning January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. Changes to the Disclosure Requirements for Defined Benefit Plans In August 2018, the FASB issued ASU 2018-14, which removes several disclosure requirements, including the amount in AOCI expected to be recognized in income over the next fiscal year and the effects of a 1% change in assumed health care cost trend rates. The standard also adds new requirements to disclose reasons for significant gains and losses related to changes in the benefit obligation for the period and weighted-average interest crediting rates for plans with promised interest crediting rates. We adopted this guidance on January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. Financial Instruments—Credit Losses In June 2016, the FASB issued ASU 2016-13, which changes the impairment model for most financial assets and certain other instruments that are not measured at fair value through net income. The new guidance applies to most financial assets measured at amortized cost, including trade and other receivables and loans as well as off-balance-sheet credit exposures (e.g., loan commitments and standby letters of credit). The standard will replace the “incurred loss” approach under the current guidance with an “expected loss” model that requires an entity to estimate its lifetime “expected credit loss.” The standard is effective for the Company’s fiscal year beginning January 1, 2020 with early adoption permitted beginning January 1, 2019. We do not expect the adoption of this guidance to have a material effect on our financial statements. Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-13, which removes the requirement to disclose: 1) amount of and reasons for transfers between Levels 1 and 2 of the fair value hierarchy, 2) policy for timing of transfers between levels, and 3) valuation processes for Level 3 investments. In addition, this guidance modifies and adds other disclosure requirements, which primarily relate to valuation of Level 3 assets and liabilities. The guidance is effective for the Company’s fiscal year beginning January 1, 2020, with early adoption permitted. We do not expect the adoption of this guidance to have a material effect on our financial statements. Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract In August 2018, the FASB issued ASU 2018-15, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. Costs to obtain software, including configuration and integration with legacy IT systems, coding and testing, including parallel process phases are eligible for capitalization under the new standard. In addition, activities that would be expensed include costs related to vendor demonstrations, determining performance and technology requirements and training activities. The standard is effective for the Company’s fiscal year beginning January 1, 2020, with early adoption permitted. We do not expect the adoption of this guidance to have a material effect on our financial statements. Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU 2019-12, which is intended to simplify accounting for income taxes and improve consistency in application. ASU 2019-12 amends certain elements of income tax accounting, including but not limited to intraperiod tax allocations, step-ups in tax basis of goodwill, and calculating taxes on year-to-date losses in interim periods. The guidance is effective for the Company’s fiscal year beginning January 1, 2021, with early adoption permitted. We are assessing the impact that the adoption of this guidance will have on our financial statements. Clarifications in Accounting for Equity Securities In January 2020, the FASB issued ASU 2020-01, which clarifies the interactions between accounting for equity investments (ASC 321), equity method accounting (ASC 323) and derivatives and hedges (ASC 815). As a result of the ASU, when entities apply the measurement alternative to non-controlling equity investments under ASC 321, and must transition to the equity method of accounting because of an observable transaction, existing investments should be remeasured immediately before applying the equity method of accounting. Additionally, it states that if entities hold non-derivative forward contracts or purchased call options to acquire equity securities, such instruments should be measured using the fair value principles of ASC 321 before settlement or exercise. The guidance is effective for the Company’s fiscal year beginning on January 1, 2021, with early adoption permitted. We are assessing the impact that the adoption of this guidance will have on our financial statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Estimated Useful Lives of Property, Plant and Equipment | Estimated useful lives of the related assets are as follows: Buildings and leasehold improvements 15 to 40 years Machinery and equipment 3 to 15 years Software 3 to 7 years |
Balance Sheet Information (Tabl
Balance Sheet Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Supplemental Information on Balance Sheets | Supplemental information on our year-end consolidated balance sheets is as follows: (In millions) 2019 2018 Inventories: Raw materials and supplies $ 274.4 $ 227.4 Work in process 72.2 66.4 Finished products 372.0 385.1 Total inventories $ 718.6 $ 678.9 Property, plant and equipment: Land and improvements $ 66.3 $ 66.8 Buildings and improvements to leaseholds 510.2 500.1 Machinery and equipment 1,316.2 1,249.0 Construction in progress 89.8 95.8 Property, plant and equipment, gross 1,982.5 1,911.7 Less: accumulated depreciation 1,158.3 1,098.3 Property, plant and equipment, net of accumulated depreciation $ 824.2 $ 813.4 Other current liabilities: Accrued salaries, wages and other compensation $ 109.7 $ 85.9 Accrued customer programs 179.5 167.8 Accrued taxes 39.3 57.7 Dividends payable 33.5 30.9 Other accrued expenses 187.6 165.8 Total other current liabilities $ 549.6 $ 508.1 |
Acquisitions and Dispositions (
Acquisitions and Dispositions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Final Allocation of Purchase Price to Fair Value of Assets Acquired and Liabilities Assumed | The following table summarizes the final allocation of the purchase price to the fair value of assets acquired and liabilities assumed as of the date of the acquisition. (In millions) Accounts receivable $ 18.8 Inventories 50.9 Property, plant and equipment 45.7 Goodwill 177.7 Identifiable intangible assets 195.0 Other assets 4.8 Total assets 492.9 Accounts payable 16.8 Other liabilities and accruals 16.3 Net assets acquired $ 459.8 |
Goodwill and Identifiable Int_2
Goodwill and Identifiable Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Change in Net Carrying Amount of Goodwill by Segment | The change in the net carrying amount of goodwill by segment was as follows: (In millions) Cabinets Plumbing Doors & Security Total Goodwill Balance at December 31, 2017 (a) $ 926.3 $ 745.2 $ 240.5 $ 1,912.0 2018 translation adjustments (2.3 ) (5.9 ) (1.4 ) (9.6 ) Acquisition-related adjustments — 4.4 173.5 177.9 Balance at December 31, 2018 (a) $ 924.0 $ 743.7 $ 412.6 $ 2,080.3 2019 translation adjustments 1.5 3.6 0.5 5.6 Acquisition-related adjustments — — 4.3 4.3 Balance at December 31, 2019 (a) $ 925.5 $ 747.3 $ 417.4 $ 2,090.2 (a) Net of accumulated impairment losses of $399.5 million in the Doors & Security segment. |
Gross Carrying Value and Accumulated Amortization by Class of Identifiable Intangible Assets | The gross carrying value and accumulated amortization by class of intangible assets as of December 31, 2019 and 2018 were as follows: As of December 31, 2019 As of December 31, 2018 (In millions) Gross Carrying Amounts Accumulated Amortization Net Book Value Gross Carrying Amounts Accumulated Amortization Net Book Value Indefinite-lived tradenames $ 635.6 $ — $ 635.6 $ 673.9 $ — $ 673.9 Amortizable intangible assets Tradenames 20.6 (12.9 ) 7.7 19.8 (11.9 ) 7.9 Customer and contractual relationships 803.9 (299.6 ) 504.3 800.3 (260.2 ) 540.1 Patents/proprietary technology 73.4 (52.1 ) 21.3 73.5 (48.6 ) 24.9 Total 897.9 (364.6 ) 533.3 893.6 (320.7 ) 572.9 Total identifiable intangibles $ 1,533.5 $ (364.6 ) $ 1,168.9 $ 1,567.5 $ (320.7 ) $ 1,246.8 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Other Information Related to Leases | Other information related to leases was as follows: (In millions, except lease term and discount rate) December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 41.3 Right-of-use assets obtained in exchange for operating lease obligations $ 24.5 Weighted average remaining lease term - operating leases 7.1 years Weighted average discount rate - operating leases 4.2 % |
Lease Payments Under Non-Cancellable Leases | Total lease payments under non-cancellable operating leases as of December 31, 2019 were as follows: (In millions) Year Ending December 31, 2020 $ 39.1 2021 33.4 2022 26.8 2023 22.6 2024 18.9 Thereafter 61.4 Total lease payments 202.2 Less imputed interest (29.3 ) Total $ 172.9 Reported as of December 31, 2019 Other current liabilities $ 33.1 Operating lease liabilities 139.8 Total $ 172.9 |
External Debt and Financing A_2
External Debt and Financing Arrangements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Outstanding Notes | The following table provides a summary of the Company’s outstanding Notes, including the carrying value of the Notes, net of underwriting commissions, price discounts, and debt issuance costs as of December 31, 2019 and December 31, 2018: (in millions) Net Carrying Value Coupon Rate Principal Amount Issuance Date Maturity Date December 31, 2019 December 31, 2018 3.000% Senior Notes $ 400.0 June 2015 June 2020 $ 399.7 $ 399.0 4.000% Senior Notes 500.0 June 2015 June 2025 495.8 495.0 4.000% Senior Notes (the “2018 Notes”) 600.0 September 2018 September 2023 596.1 595.0 3.250% Senior Notes (the “2019 Notes”) 700.0 September 2019 September 2029 692.7 — Total Senior Notes $ 2,200.0 $ 2,184.3 $ 1,489.0 |
Components of Long-Term Debt | The components of long-term debt were as follows: (In millions) 2019 2018 Notes $ 2,184.3 $ 1,489.0 $1,250 million revolving credit agreement due September 2024 — 320.0 Term Loan (due March 2020) — 525.0 Total debt 2,184.3 2,334.0 Less: current portion 399.7 525.0 Total long-term debt $ 1,784.6 $ 1,809.0 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Fair Values of Derivative Instruments | The fair values of foreign exchange and commodity derivative instruments on the consolidated balance sheets as of December 31, 2019 and 2018 were: Fair Value (In millions) Location 2019 2018 Assets: Foreign exchange contracts Other current assets $ 2.9 $ 5.3 Commodity contracts Other current assets 0.1 — Net investment hedges Other current assets — 0.7 Total assets $ 3.0 $ 6.0 Liabilities: Foreign exchange contracts Other current liabilities $ 2.2 $ 1.9 Net investment hedges Other current liabilities 0.3 — Total liabilities $ 2.5 $ 1.9 |
Effects of Derivative Financial Instruments on Consolidated Statements of Income | The effects of derivative financial instruments on the consolidated statements of income in 2019, 2018 and 2017 were: (In millions) Classification and Amount of Gain (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships 2019 Cost of products sold Interest expense Other expense, net Total amounts per Consolidated Statements of Income $ 3,712.2 $ 94.2 $ 29.0 The effects of fair value and cash flow hedging: Gain (loss) on fair value hedging relationships Foreign exchange contracts: Hedged items 4.0 Derivative designated as hedging instruments (3.0 ) Gain (loss) on cash flow hedging relationships Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 4.1 Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income (0.1 ) Interest rate contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 0.4 (In millions) Classification and Amount of Gain (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships 2018 Cost of products sold Interest expense Other income, net Total amounts per Consolidated Statements of Income $ 3,525.7 $ 74.5 $ 16.3 The effects of fair value and cash flow hedging: Gain (loss) on fair value hedging relationships Foreign exchange contracts: Hedged items (3.4 ) Derivative designated as hedging instruments 5.0 Gain (loss) on cash flow hedging relationships Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 2.2 Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income (0.2 ) Interest rate contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 0.1 (In millions) Classification and Amount of Gain (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships 2017 Cost of products sold Interest expense Other income, net Total amounts per Consolidated Statements of Income $ 3,358.3 $ 49.4 $ 1.7 The effects of fair value and cash flow hedging: Gain (loss) on fair value hedging relationships Foreign exchange contracts: Hedged items 2.7 Derivative designated as hedging instruments (3.5 ) Gain (loss) on cash flow hedging relationships Foreign exchange contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 0.4 Commodity contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income 0.5 Interest rate contracts: Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income - |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Carrying Value and Fair Value of Debt | The carrying value and fair value of debt as of December 31, 2019 and 2018 were as follows: (In millions) December 31, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value Revolving credit facility $ — $ — $ 320.0 $ 320.0 Term Loan — — 525.0 525.0 Senior Notes, net of underwriting commissions and price discounts 2,184.3 2,271.4 1,489.0 1,490.4 |
Assets and Liabilities Measured at Fair Value on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis as of December 31, 2019 and 2018 were as follows: (In millions) Fair Value 2019 2018 Assets: Derivative asset financial instruments (level 2) $ 3.0 $ 6.0 Deferred compensation program assets (level 2) 12.1 9.3 Total assets $ 15.1 $ 15.3 Liabilities: Derivative liability financial instruments (level 2) $ 2.5 $ 1.9 |
Capital Stock (Tables)
Capital Stock (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Common Stock and Treasury Stock Activity | The number of shares of common stock and treasury stock and the share activity for 2019 and 2018 were as follows: Common Shares Treasury Shares 2019 2018 2019 2018 Balance at the beginning of the year 140,498,981 151,906,797 40,110,623 27,879,929 Stock plan shares issued 1,281,198 822,878 — — Shares surrendered by optionees (185,141 ) (230,550 ) 185,141 230,550 Common stock repurchases (2,039,551 ) (12,000,144 ) 2,039,551 12,000,144 Balance at the end of the year 139,555,487 140,498,981 42,335,315 40,110,623 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive (Loss) Income (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Reclassifications Out of Accumulated Other Comprehensive (Loss) Income | The reclassifications out of accumulated other comprehensive (loss) income for the years ended December 31, 2019 and 2018 were as follows: (In millions) Details about Accumulated Other Comprehensive Income Components Affected Line Item in the Consolidated Statements of Income 2019 2018 Gains (losses) on cash flow hedges Foreign exchange contracts $ 4.1 $ 2.2 Cost of products sold Interest rate contracts 0.4 0.1 Interest expense Commodity contracts (0.1 ) (0.2 ) Cost of products sold 4.4 2.1 Total before tax (0.6 ) (0.4 ) Tax expense $ 3.8 $ 1.7 Net of tax Defined benefit plan items Recognition of actuarial losses (34.1 ) (3.8 ) (a) 8.3 0.8 Tax expense $ (25.8 ) $ (3.0 ) Net of tax Total reclassifications for the period $ (22.0 ) $ (1.3 ) Net of tax (a) These accumulated other comprehensive (loss) income components are included in the computation of net periodic benefit cost. Refer to Note 16, “Defined Benefit Plans,” for additional information. |
After-Tax Components of and Changes in Accumulated Other Comprehensive (Loss) Income | The after-tax components of and changes in accumulated other comprehensive (loss) income were as follows: (In millions) Foreign Currency Adjustments Derivative Hedging Gain (Loss) Defined Benefit Plan Adjustments Accumulated Other Comprehensive (Loss) Income Balance at December 31, 2016 $ (28.0 ) $ (0.6 ) $ (43.3 ) $ (71.9 ) Amounts classified into accumulated other comprehensive (loss) income 33.8 (1.0 ) 4.3 37.1 Amounts reclassified from accumulated other comprehensive (loss) income into earnings — (0.8 ) (3.6 ) (4.4 ) Net current period other comprehensive (loss) income 33.8 (1.8 ) 0.7 32.7 Balance at December 31, 2017 $ 5.8 $ (2.4 ) $ (42.6 ) $ (39.2 ) Amounts classified into accumulated other comprehensive (loss) income (31.1 ) 8.3 (6.3 ) (29.1 ) Amounts reclassified into earnings — (1.7 ) 3.0 1.3 Net current period other comprehensive (loss) income (31.1 ) 6.6 (3.3 ) (27.8 ) Balance at December 31, 2018 $ (25.3 ) $ 4.2 $ (45.9 ) $ (67.0 ) Amounts classified into accumulated other comprehensive (loss) income 13.8 5.1 (37.9 ) (19.0 ) Amounts reclassified into earnings — (3.8 ) 25.8 22.0 Adoption of ASU 2018-02 — — (8.6 ) (8.6 ) Net current period other comprehensive (loss) income 13.8 1.3 (20.7 ) (5.6 ) Balance at December 31, 2019 $ (11.5 ) $ 5.5 $ (66.6 ) $ (72.6 ) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Pre-Tax Stock-Based Compensation Expense from Continuing Operations | Stock-based compensation expense from continuing operations was as follows: (In millions) 2019 2018 2017 Stock option awards $ 7.0 $ 8.6 $ 7.4 Restricted stock units 19.4 21.3 21.6 Performance awards 4.2 6.3 13.6 Director awards 1.2 1.0 1.0 Total pre-tax expense 31.8 37.2 43.6 Tax benefit 6.0 6.2 15.2 Total after tax expense $ 25.8 $ 31.0 $ 28.4 |
Restricted Stock Units Activity | A summary of activity with respect to restricted stock units outstanding under the Plans for the year ended December 31, 2019 was as follows: Number of Restricted Stock Units Weighted-Average Grant-Date Fair Value Non-vested at December 31, 2018 660,375 $ 58.63 Granted 468,617 49.46 Vested (314,482 ) 57.51 Forfeited (58,028 ) 52.78 Non-vested at December 31, 2019 756,482 $ 53.89 |
Black-Scholes Option Pricing Model Assumptions used to Estimate Fair Value of Options | The fair value of Fortune Brands options was estimated at the date of grant using a Black-Scholes option pricing model with the assumptions shown in the following table: 2019 2018 2017 Current expected dividend yield 1.5 % 1.3% 1.4% Expected volatility 27.0 % 24.0% 26.0% Risk-free interest rate 2.5 % 2.6% 1.9% Expected term 5 years 5 years 5.5 years |
Stock Option Activity | A summary of Fortune Brands stock option activity related to Fortune Brands and former employees of Fortune Brands, Inc., the Company from which we spun off from in 2011, for the year ended December 31, 2019 was as follows: Options Weighted- Average Exercise Price Outstanding at December 31, 2018 4,023,822 $ 40.83 Granted 652,559 47.85 Exercised (760,807 ) 22.71 Expired/forfeited (90,358 ) 56.35 Outstanding at December 31, 2019 3,825,216 $ 45.27 |
Options Outstanding and Exercisable | Options outstanding and exercisable at December 31, 2019 were as follows: Options Outstanding (a) Options Exercisable (b) Range Of Exercise Prices Options Outstanding Weighted- Average Remaining Contractual Life Weighted- Average Exercise Price Options Exercisable Weighted- Average Exercise Price 13.00 to 20.00 623,901 1.7 16.74 623,901 16.74 20.01 to 65.41 3,201,315 6.6 50.83 2,044,336 48.91 3,825,216 5.8 $ 45.27 2,668,237 $ 41.39 (a) (b) |
Summarizes Information of Performance Share Awards | The following table summarizes information about Number of Performance Share Awards Weighted-Average Grant-Date Fair Value Non-vested at December 31, 2018 409,091 $ 57.50 Granted 310,471 47.77 Vested (126,700 ) 50.85 Forfeited (37,205 ) 55.74 Non-vested at December 31, 2019 555,657 $ 53.71 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Disaggregation of Revenue | The following table disaggregates our consolidated revenue by major sales distribution channels for the years ended December 31, 2019 and 2018. (In millions) December 31, 2019 December 31, 2018 Wholesalers (a) $ 2,682.8 $ 2,607.3 Home Center retailers (b) 1,606.7 1,452.3 Other retailers (c) 304.8 311.6 Builder direct 229.4 235.4 U.S. net sales 4,823.7 4,606.6 International (d) 940.9 878.5 Net sales $ 5,764.6 $ 5,485.1 ( a ) ( b ) ( c ) ( d ) |
Defined Benefit Plans (Tables)
Defined Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Compensation And Retirement Disclosure [Abstract] | |
Obligations and Funded Status | (In millions) Pension Benefits Postretirement Benefits Obligations and Funded Status at December 31 2019 2018 2019 2018 Change in the Projected Benefit Obligation (PBO): Projected benefit obligation at beginning of year $ 763.2 $ 832.4 $ 1.4 $ 1.6 Service cost 0.4 0.5 0.2 — Interest cost 32.9 30.7 0.2 — Plan amendments — — 1.6 — Actuarial loss (gain) 121.6 (63.1 ) 1.0 (0.2 ) Benefits paid (41.0 ) (37.3 ) (0.7 ) — Curtailment gain — — (0.1 ) — Projected benefit obligation at end of year $ 877.1 $ 763.2 $ 3.6 $ 1.4 Accumulated benefit obligation at end of year (excludes the impact of future compensation increases) $ 877.1 $ 763.2 $ — $ — Change in Plan Assets: Fair value of plan assets at beginning of year $ 599.6 $ 656.6 $ — $ — Actual return on plan assets 106.8 (30.7 ) — — Employer contributions 11.8 11.0 0.7 — Benefits paid (41.0 ) (37.3 ) (0.7 ) — Fair value of plan assets at end of year $ 677.2 $ 599.6 $ — $ — Funded status (Fair value of plan assets less PBO) $ (199.9 ) $ (163.6 ) $ (3.6 ) $ (1.4 ) |
Amounts Recognized in Consolidated Balance Sheets | Amounts recognized in the consolidated balance sheets consist of: Pension Benefits Postretirement Benefits (In millions) 2019 2018 2019 2018 Current benefit payment liability $ (1.4 ) $ (1.5 ) $ (0.7 ) $ (0.2 ) Accrued benefit liability (198.5 ) (162.1 ) (2.9 ) (1.2 ) Net amount recognized $ (199.9 ) $ (163.6 ) $ (3.6 ) $ (1.4 ) |
Amounts in Accumulated Other Comprehensive Loss that have not yet been Recognized as Components of Net Periodic Benefit Cost | The amounts in accumulated other comprehensive loss on the consolidated balance sheets that have not yet been recognized as components of net periodic benefit cost were as follows: (In millions) Pension Benefits Postretirement Benefits Net actuarial loss at December 31, 2017 $ 67.2 $ — Recognition of actuarial (loss) gain (3.9 ) 0.1 Current year actuarial loss (gain) 8.5 (0.4 ) Net actuarial loss (gain) at December 31, 2018 $ 71.8 $ (0.3 ) Recognition of actuarial (loss) gain (34.1 ) (0.6 ) Current year actuarial loss 50.1 0.6 Net actuarial loss due to curtailment (0.1 ) — Net actuarial loss (gain) at December 31, 2019 $ 87.7 $ (0.3 ) |
Components of Net Periodic Benefit Cost for Pension and Postretirement Benefits | Components of net periodic benefit cost were as follows: Components of Net Periodic Benefit (Income) Cost Pension Benefits Postretirement Benefits (In millions) 2019 2018 2017 2019 2018 2017 Service cost $ 0.4 $ 0.5 $ 0.6 $ 0.2 $ — $ — Interest cost 32.9 30.7 33.3 0.2 — — Expected return on plan assets (35.2 ) (41.0 ) (37.3 ) — — — Recognition of actuarial losses (gains) 34.1 3.9 0.9 0.6 (0.1 ) (1.4 ) Settlement/Curtailment losses (gains) 0.1 — — (0.1 ) — — Amortization of prior service credits — — — 0.2 — (5.1 ) Net periodic benefit cost (income) $ 32.3 $ (5.9 ) $ (2.5 ) $ 1.1 $ (0.1 ) $ (6.5 ) |
Schedule of Assumptions Used | Assumptions Pension Benefits Postretirement Benefits 2019 2018 2017 2019 2018 2017 Weighted-Average Assumptions Used to Determine Benefit Obligations at December 31: Discount rate 3.3 % 4.4 % 3.8 % 6.4 % 4.2 % 3.4 % Weighted-Average Assumptions Used to Determine Net Cost for Years Ended December 31: Discount rate 4.4 % 3.8 % 4.3 % 4.2 % 3.4 % 3.4 % Expected long-term rate of return on plan assets 4.9 % 6.0 % 6.4 % — — — |
Assumed Health Care Cost Trend Rates Used to Determine Benefit Obligations and Net Cost | Postretirement Benefits 2019 2018 Assumed Health Care Cost Trend Rates Used to Determine Benefit Obligations and Net Cost at December 31: Health care cost trend rate assumed for next year 6.7/7.8 % (a) 6.9/8.0 % (a) Rate that the cost trend rate is assumed to decline (the ultimate trend rate) 4.5 % 4.5 % Year that the rate reaches the ultimate trend rate 2027 2027 (a) |
Fair Value of Pension Assets by Major Category of Plan Assets | The fair value of the pension assets by major category of plan assets as of December 31, 2019 and 2018 were as follows: (In millions) Total as of balance sheet date 2019 2018 Group annuity/insurance contracts (level 3) $ 24.2 $ 23.6 Collective trusts: Cash and cash equivalents 7.8 7.7 Equity 245.3 197.7 Fixed income 355.0 324.6 Multi-strategy hedge funds 23.2 22.0 Real estate 21.7 24.0 Total $ 677.2 $ 599.6 |
Reconciliation of Level Three Measurements | A reconciliation of Level 3 measurements was as follows: Group annuity/ insurance contracts (In millions) 2019 2018 January 1 $ 23.6 $ 23.3 Actual return on assets related to assets still held 0.6 0.3 December 31 $ 24.2 $ 23.6 |
Schedule of Expected Benefit Payments | The following retirement benefit payments are expected to be paid: (In millions) Pension Benefits Postretirement Benefits 2020 $ 41.2 $ 0.4 2021 42.4 0.4 2022 43.5 0.3 2023 44.5 0.3 2024 45.8 0.3 Years 2025-2029 239.6 2.1 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Components of Loss Income Before Income Taxes and Noncontrolling Interests | The components of income from continuing operations before income taxes and noncontrolling interests were as follows: (In millions) 2019 2018 2017 Domestic operations $ 438.2 $ 456.7 $ 554.7 Foreign operations 137.1 80.3 80.1 Income before income taxes and noncontrolling interests $ 575.3 $ 537.0 $ 634.8 |
Reconciliation of Income Taxes at Federal Statutory Income Tax Rate to Income Taxes from Continuing Operations | A reconciliation of income taxes at the 35% federal statutory income tax rate for 2017 and 21% for 2018 and 2019 to the income tax provision reported was as follows: (In millions) 2019 2018 2017 Income tax expense computed at federal statutory income tax rate $ 120.8 $ 112.8 $ 222.2 Other income taxes, net of federal tax benefit 18.0 13.7 13.4 Foreign taxes at a different rate than U.S. federal statutory income tax rate 1.4 3.5 (8.3 ) Tax benefit on income attributable to domestic production activities — — (10.9 ) Net adjustments for uncertain tax positions 7.5 4.1 11.6 Share-based compensation (ASU 2016-09) (3.7 ) (2.1 ) (23.9 ) Tax Act impact — 5.5 (25.7 ) Deferred tax impact of state tax rate changes 3.1 3.5 (2.0 ) Valuation allowance increase (decrease) 3.4 3.0 (5.2 ) Miscellaneous other, net (6.5 ) 3.0 (11.7 ) Income tax expense as reported $ 144.0 $ 147.0 $ 159.5 Effective income tax rate 25.0 % 27.4 % 25.1 % |
Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits (“UTBs”) was as follows: (In millions) 2019 2018 2017 Unrecognized tax benefits—beginning of year $ 83.5 $ 87.5 $ 58.2 Gross additions—current year tax positions 9.2 9.1 31.0 Gross additions—prior year tax positions 2.9 9.3 10.9 Gross additions (reductions)—purchase accounting adjustments — 1.0 4.0 Gross reductions—prior year tax positions (6.9 ) (14.5 ) (9.4 ) Gross reductions—settlements with taxing authorities (0.7 ) (8.9 ) (7.2 ) Unrecognized tax benefits—end of year $ 88.0 $ 83.5 $ 87.5 |
Summary of Income Tax | Income taxes in 2019, 2018 and 2017 were as follows: (In millions) 2019 2018 2017 Current Federal $ 94.9 $ 93.5 $ 133.1 Foreign 35.1 26.4 22.4 State and other 21.5 24.1 22.8 Deferred Federal, state and other (4.4 ) 4.8 (27.2 ) Foreign (3.1 ) (1.8 ) 8.4 Total income tax expense $ 144.0 $ 147.0 $ 159.5 |
Components of Net Deferred Tax Assets Liabilities | The components of net deferred tax assets (liabilities) as of December 31, 2019 and 2018 were as follows: (In millions) 2019 2018 Deferred tax assets: Compensation and benefits $ 37.6 $ 31.5 Defined benefit plans 50.8 39.3 Capitalized inventories 18.2 16.1 Accounts receivable 5.1 5.4 Other accrued expenses 58.8 55.2 Net operating loss and other tax carryforwards 22.4 21.2 Valuation allowance (16.8 ) (13.3 ) Miscellaneous 3.9 2.5 Total deferred tax assets 180.0 157.9 Deferred tax liabilities: Fixed assets (70.4 ) (60.2 ) Intangible assets (222.9 ) (224.6 ) Investment in partnership (7.4 ) (3.8 ) Miscellaneous (19.2 ) (20.0 ) Total deferred tax liabilities (319.9 ) (308.6 ) Net deferred tax liability $ (139.9 ) $ (150.7 ) In accordance with ASC requirements for Income Taxes, deferred taxes were classified in the consolidated balance sheets as of December 31, 2019 and 2018 as follows: (In millions) 2019 2018 Other assets 17.3 11.9 Deferred income taxes (157.2 ) (162.6 ) Net deferred tax liability $ (139.9 ) $ (150.7 ) |
Restructuring and Other Charg_2
Restructuring and Other Charges (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring And Related Activities [Abstract] | |
Pre-tax Restructuring and Other Charges | Pre-tax restructuring and other charges for the year ended December 31, 2019 were as follows: Year Ended December 31, 2019 Other Charges (a) (In millions) Restructuring Charges Cost of Products Sold SG&A (b) Total Charges Cabinets $ 10.2 $ (0.1 ) $ 0.6 $ 10.7 Plumbing 2.8 2.6 2.8 8.2 Doors & Security 1.7 1.6 — 3.3 Total $ 14.7 $ 4.1 $ 3.4 $ 22.2 (a) “Other Charges” represent charges or gains directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such charges or gains may include losses on disposal of inventories, trade receivables allowances from exiting product lines, write-off of displays from exiting a customer relationship, accelerated depreciation resulting from the closure of facilities, and gains and losses on the sale of previously closed facilities. (b) Selling, general and administrative expenses Restructuring and other charges in 2019 largely related to severance costs and costs associated with closing facilities across all of our segments. Pre-tax restructuring and other charges for the year ended December 31, 2018 were as follows: Year Ended December 31, 2018 Other Charges (a) (In millions) Restructuring Charges Cost of Products Sold SG&A (b) Total Charges Cabinets $ 16.8 $ 9.1 $ 0.3 $ 26.2 Plumbing 2.6 0.6 0.1 3.3 Doors & Security 4.7 2.4 (1.2 ) 5.9 Total $ 24.1 $ 12.1 $ (0.8 ) $ 35.4 (a) “Other Charges” represent charges or gains directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such charges or gains may include losses on disposal of inventories, trade receivables allowances from exiting product lines, accelerated depreciation resulting from the closure of facilities, and gains and losses on the sale of previously closed facilities. (b) Selling, general and administrative expenses Restructuring and other charges in 2018 are largely related to our initiatives to consolidate and rationalize our manufacturing footprint and discontinue certain product lines in our Cabinets segment and severance costs within all our segments. Pre-tax restructuring and other charges for the year ended December 31, 2017 were as follows: Year Ended December 31, 2017 Other Charges (a) (In millions) Restructuring Charges Cost of Products Sold SG&A (b) Total Charges Cabinets $ 1.4 $ 1.6 $ 2.2 $ 5.2 Plumbing 2.8 — — 2.8 Doors & Security 4.1 5.6 0.8 10.5 Total $ 8.3 $ 7.2 $ 3.0 $ 18.5 (a) “Other Charges” represent charges or gains directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such charges or gains may include losses on disposal of inventories, trade receivables allowances from exiting product lines, accelerated depreciation resulting from the closure of facilities, and gains and losses on the sale of previously closed facilities. (b) Selling, general and administrative expenses |
Reconciliation of Restructuring Liability | Reconciliation of Restructuring Liability (In millions) Balance at 12/31/18 2019 Provision Cash Expenditures (a) Non-Cash Write-offs Balance at 12/31/19 Workforce reduction costs $ 9.9 $ 13.5 $ (16.6 ) $ (0.1 ) $ 6.7 Other 0.6 1.2 (1.4 ) (0.3 ) 0.1 $ 10.5 $ 14.7 $ (18.0 ) $ (0.4 ) $ 6.8 (a) (In millions) Balance at 12/31/17 2018 Provision Cash Expenditures (a) Non-Cash Write-offs Balance at 12/31/18 Workforce reduction costs $ 5.0 $ 21.4 $ (16.3 ) $ (0.2 ) $ 9.9 Other 0.8 2.7 (2.4 ) (0.5 ) 0.6 $ 5.8 $ 24.1 $ (18.7 ) $ (0.7 ) $ 10.5 ( a ) |
Commitments (Tables)
Commitments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Future Minimum Rental Payments under Non-Cancelable Operating Leases | Future minimum rental payments under non-cancelable operating leases as of December 31, 2018 were as follows: (In millions) 2019 $ 37.8 2020 29.6 2021 23.4 2022 18.9 2023 13.8 Remainder 58.8 Total minimum rental payments $ 182.3 |
Activity Related to Product Warranty Liability | The following table summarizes activity related to our product warranty liability for the years ended December 31, 2019, 2018 and 2017. (In millions) 2019 2018 2017 Reserve balance at the beginning of the year $ 24.9 $ 17.2 $ 16.2 Provision for warranties issued 25.4 25.1 25.1 Settlements made (in cash or in kind) (25.8 ) (25.7 ) (24.3 ) Acquisition — 8.9 — Foreign currency 0.2 (0.6 ) 0.2 Reserve balance at end of year $ 24.7 $ 24.9 $ 17.2 |
Information on Business Segme_2
Information on Business Segments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Net Sales and Operating Income by Segment | The Company’s subsidiaries operate principally in the United States, Canada, Mexico, China and Western Europe. (In millions) 2019 2018 2017 Net sales: Cabinets $ 2,388.5 $ 2,418.6 $ 2,467.1 Plumbing 2,027.2 1,883.3 1,720.8 Doors & Security 1,348.9 1,183.2 1,095.4 Net sales $ 5,764.6 $ 5,485.1 $ 5,283.3 (In millions) 2019 2018 2017 Operating income: Cabinets $ 178.3 $ 143.5 $ 267.2 Plumbing 427.6 375.3 358.5 Doors & Security 172.3 155.6 146.9 Less: Corporate expenses (a) (79.7 ) (79.2 ) (90.1 ) Operating income $ 698.5 $ 595.2 $ 682.5 (a) Below is a table detailing Corporate expenses: General and administrative expense $ (79.7 ) $ (79.2 ) $ (85.0 ) Long-lived asset impairment — — (5.1 ) Total Corporate expenses $ (79.7 ) $ (79.2 ) $ (90.1 ) (In millions) 2019 2018 2017 Total assets: Cabinets $ 2,355.7 $ 2,318.7 $ 2,416.3 Plumbing 2,110.8 1,943.1 1,854.1 Doors & Security 1,596.6 1,526.0 1,032.2 Corporate 228.2 176.8 208.8 Total assets $ 6,291.3 $ 5,964.6 $ 5,511.4 Depreciation expense: Cabinets $ 44.3 $ 50.9 $ 42.8 Plumbing 32.0 29.1 26.9 Doors & Security 32.3 30.2 25.9 Corporate 2.7 3.3 3.0 Depreciation expense $ 111.3 $ 113.5 $ 98.6 Amortization of intangible assets: Cabinets $ 17.8 $ 19.6 $ 19.7 Plumbing 10.3 10.4 7.7 Doors & Security 13.3 6.1 4.3 Amortization of intangible assets $ 41.4 $ 36.1 $ 31.7 Capital expenditures: Cabinets $ 30.9 $ 73.8 $ 63.4 Plumbing 35.7 41.4 43.5 Doors & Security 63.6 34.3 40.1 Corporate 1.6 0.6 18.0 Capital expenditures, gross 131.8 150.1 165.0 Less: proceeds from disposition of assets (4.2 ) (6.1 ) (0.4 ) Capital expenditures, net $ 127.6 $ 144.0 $ 164.6 Net sales by geographic region (a) United States $ 4,823.7 $ 4,606.6 $ 4,492.2 Canada 401.0 433.1 427.6 China 355.4 260.6 202.3 Other international 184.5 184.8 161.2 Net sales $ 5,764.6 $ 5,485.1 $ 5,283.3 Property, plant and equipment, net: United States $ 641.9 $ 628.9 $ 562.3 Mexico 103.2 103.4 89.0 Canada 43.9 46.0 50.5 China 22.5 22.5 24.8 Other international 12.7 12.6 13.4 Property, plant and equipment, net $ 824.2 $ 813.4 $ 740.0 (a) Based on country of destination |
Quarterly Financial Data (Table
Quarterly Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data | Unaudited (In millions, except per share amounts) 2019 1 st 2 nd 3 rd 4 th Full Year Net sales $ 1,327.9 $ 1,507.2 $ 1,459.0 $ 1,470.5 $ 5,764.6 Gross profit 458.8 537.6 524.2 531.8 2,052.4 Operating income 135.6 202.4 168.0 192.5 698.5 Income from continuing operations, net of tax 84.5 137.1 105.7 104.0 431.3 Income (loss) from discontinued operations, net of tax — — — — — Net income 84.5 137.1 105.7 104.0 431.3 Net income attributable to Fortune Brands 84.7 137.5 105.6 104.1 431.9 Basic earnings (loss) per common share Continuing operations 0.60 0.98 0.76 0.75 3.09 Discontinued operations — — — — — Net income attributable to Fortune Brands 0.60 0.98 0.76 0.75 3.09 Diluted earnings (loss) per common share Continuing operations 0.60 0.97 0.75 0.74 3.06 Discontinued operations — — — — — Net income attributable to Fortune Brands 0.60 0.97 0.75 0.74 3.06 2018 1 st 2 nd 3 rd 4 th Full Year Net sales $ 1,254.6 $ 1,429.0 $ 1,380.8 $ 1,420.7 $ 5,485.1 Gross profit 439.6 524.1 493.9 501.8 1,959.4 Operating income 119.4 188.6 147.1 140.1 595.2 Income from continuing operations, net of tax 75.1 129.7 99.9 85.3 390.0 Income (loss) from discontinued operations, net of tax (0.2 ) — — — (0.2 ) Net income 74.9 129.7 99.9 85.3 389.8 Net income attributable to Fortune Brands 75.0 129.6 99.8 85.2 389.6 Basic earnings (loss) per common share Continuing operations 0.50 0.89 0.70 0.60 2.69 Discontinued operations — — — — — Net income attributable to Fortune Brands 0.50 0.89 0.70 0.60 2.69 Diluted earnings (loss) per common share Continuing operations 0.49 0.88 0.69 0.60 2.66 Discontinued operations — — — — — Net income attributable to Fortune Brands 0.49 0.88 0.69 0.60 2.66 |
Earning Per Share (Tables)
Earning Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Computations of Earnings (Loss) per Common Share | The computations of earnings (loss) per common share were as follows: (In millions, except per share data) 2019 2018 2017 Income from continuing operations, net of tax $ 431.3 $ 390.0 $ 475.3 Less: Noncontrolling interests (0.6 ) 0.2 0.1 Income from continuing operations for EPS 431.9 389.8 475.2 Income (loss) from discontinued operations — (0.2 ) (2.6 ) Net income attributable to Fortune Brands $ 431.9 $ 389.6 $ 472.6 Earnings (loss) per common share Basic Continuing operations $ 3.09 $ 2.69 $ 3.10 Discontinued operations — — (0.02 ) Net income attributable to Fortune Brands common stockholders $ 3.09 $ 2.69 $ 3.08 Diluted Continuing operations $ 3.06 $ 2.66 $ 3.05 Discontinued operations — — (0.02 ) Net income attributable to Fortune Brands common stockholders $ 3.06 $ 2.66 $ 3.03 Basic average shares outstanding (a) 139.9 144.6 153.2 Stock-based awards 1.4 1.8 2.6 Diluted average shares outstanding (a) 141.3 146.4 155.8 Antidilutive stock-based awards excluded from weighted-average number of shares outstanding for diluted earnings per share 1.8 1.5 0.5 (a) Reflects the impact of share repurchases during the years ended December 31, 2019, 2018 and 2017, respectively. |
Other Expense (Income) Net (Tab
Other Expense (Income) Net (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Other Income And Expenses [Abstract] | |
Components of Other Expense (Income), Net | The components of other expense (income), net for the years ended December 31, 2019, 2018 and 2017 were as follows: (In millions) 2019 2018 2017 Defined benefit plan $ 31.9 $ (6.5 ) $ (9.6 ) Asset impairment charge — — 7.0 Foreign currency (gains)/losses (0.7 ) (2.0 ) 0.9 Ineffective portion of cash flow hedge — (3.8 ) — Other items, net (2.2 ) (4.0 ) — Total other expense (income), net $ 29.0 $ (16.3 ) $ (1.7 ) |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||
Jan. 31, 2020 | Dec. 31, 2019 | Aug. 31, 2018 | Jul. 31, 2018 | Jun. 30, 2018 | Jun. 30, 2016 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | Dec. 31, 2016 | |
Significant Of Accounting Policies [Line Items] | |||||||||||||
Highly liquid investments included in cash and cash equivalents, maturity period | 3 months | ||||||||||||
Allowances for doubtful accounts | $ 3,000,000 | $ 3,000,000 | $ 3,700,000 | ||||||||||
Change in Accounting Estimate, Description | During the fourth quarter of 2018, we determined that it was preferable to change our accounting policy from last-in, first-out (“LIFO”) to FIFO for product groups in which metals comprise a significant portion of inventory cost. | ||||||||||||
Impairment of long-lived asset | $ 3,000,000 | 0 | |||||||||||
Investments | 29,200,000 | $ 29,200,000 | 28,700,000 | ||||||||||
Impairment of Investments | 0 | $ 7,000,000 | |||||||||||
Unrecognized tax benefits pertaining to uncertain tax positions | $ 88,000,000 | 88,000,000 | 83,500,000 | 87,500,000 | $ 58,200,000 | ||||||||
Advertising costs | 251,700,000 | 243,600,000 | 233,200,000 | ||||||||||
Advertising costs, reduction to net sales | 74,000,000 | 72,400,000 | 65,600,000 | ||||||||||
Research and development expenses | 48,200,000 | 50,300,000 | 50,700,000 | ||||||||||
New Accounting Pronouncement or Change in Accounting Principle, Description | Codification Improvements In July 2018, the FASB issued ASU 2018-09, which includes technical corrections, clarifications, and other minor improvements to various areas including business combinations, fair value measurements and hedging. The transition and effective date guidance is based on the facts and circumstances of each amendment. Some of the amendments in this standard were effective immediately, while others were effective for the Company’s fiscal year beginning January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. | Improvements to Nonemployee Share-Based Payment Accounting In June 2018, the FASB issued ASU 2018-07, which simplifies the accounting for share-based arrangements with nonemployees. The new guidance generally aligns the accounting for share-based awards to nonemployees with the guidance for share-based awards to employees. The guidance was effective for the Company’s fiscal year beginning January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. | Financial Instruments—Credit Losses In June 2016, the FASB issued ASU 2016-13, which changes the impairment model for most financial assets and certain other instruments that are not measured at fair value through net income. The new guidance applies to most financial assets measured at amortized cost, including trade and other receivables and loans as well as off-balance-sheet credit exposures (e.g., loan commitments and standby letters of credit). The standard will replace the “incurred loss” approach under the current guidance with an “expected loss” model that requires an entity to estimate its lifetime “expected credit loss.” The standard is effective for the Company’s fiscal year beginning January 1, 2020 with early adoption permitted beginning January 1, 2019. We do not expect the adoption of this guidance to have a material effect on our financial statements. | ||||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | $ (22,000,000) | (1,300,000) | |||||||||||
Accounting Standards Update 2016-02 [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Operating Lease, Right-of-Use Asset | $ 177,200,000 | ||||||||||||
Operating lease liabilities | $ 182,600,000 | ||||||||||||
Accounting Standards Update 2017-12 [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
New Accounting Pronouncement or Change in Accounting Principle, Description | In August 2017, the FASB issued ASU 2017-12, which amends the current hedge accounting model. The new standard eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item (which is consistent with our prior practice). The change in fair value for qualifying cash flow and net investment hedges is included in other comprehensive loss (until they are reclassified into the income statement). The standard also eased certain documentation and assessment requirements and modified the accounting for components excluded from the assessment of hedge effectiveness. We adopted this standard as of January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. | ||||||||||||
Accounting Standards Update 2018 02 [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | $ 8,600,000 | ||||||||||||
Accounting Standards Update 2018-14 [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
New Accounting Pronouncement or Change in Accounting Principle, Description | Changes to the Disclosure Requirements for Defined Benefit Plans In August 2018, the FASB issued ASU 2018-14, which removes several disclosure requirements, including the amount in AOCI expected to be recognized in income over the next fiscal year and the effects of a 1% change in assumed health care cost trend rates. The standard also adds new requirements to disclose reasons for significant gains and losses related to changes in the benefit obligation for the period and weighted-average interest crediting rates for plans with promised interest crediting rates. We adopted this guidance on January 1, 2019. The adoption of this standard did not have a material effect on our financial statements. | ||||||||||||
Effect of health care cost trend rate | 1.00% | ||||||||||||
Accounting Standards Update 2018-13 [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
New Accounting Pronouncement or Change in Accounting Principle, Description | Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-13, which removes the requirement to disclose: 1) amount of and reasons for transfers between Levels 1 and 2 of the fair value hierarchy, 2) policy for timing of transfers between levels, and 3) valuation processes for Level 3 investments. In addition, this guidance modifies and adds other disclosure requirements, which primarily relate to valuation of Level 3 assets and liabilities. The guidance is effective for the Company’s fiscal year beginning January 1, 2020, with early adoption permitted. We do not expect the adoption of this guidance to have a material effect on our financial statements. Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract In August 2018, the FASB issued ASU 2018-15, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. Costs to obtain software, including configuration and integration with legacy IT systems, coding and testing, including parallel process phases are eligible for capitalization under the new standard. In addition, activities that would be expensed include costs related to vendor demonstrations, determining performance and technology requirements and training activities. The standard is effective for the Company’s fiscal year beginning January 1, 2020, with early adoption permitted. We do not expect the adoption of this guidance to have a material effect on our financial statements. | ||||||||||||
Accounting Standards Update 2019-12 [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
New Accounting Pronouncement or Change in Accounting Principle, Description | Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU 2019-12, which is intended to simplify accounting for income taxes and improve consistency in application. ASU 2019-12 amends certain elements of income tax accounting, including but not limited to intraperiod tax allocations, step-ups in tax basis of goodwill, and calculating taxes on year-to-date losses in interim periods. The guidance is effective for the Company’s fiscal year beginning January 1, 2021, with early adoption permitted. We are assessing the impact that the adoption of this guidance will have on our financial statements. | ||||||||||||
Accounting Standards Update 2020-01 [Member] | Subsequent Event [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
New Accounting Pronouncement or Change in Accounting Principle, Description | Clarifications in Accounting for Equity Securities In January 2020, the FASB issued ASU 2020-01, which clarifies the interactions between accounting for equity investments (ASC 321), equity method accounting (ASC 323) and derivatives and hedges (ASC 815). As a result of the ASU, when entities apply the measurement alternative to non-controlling equity investments under ASC 321, and must transition to the equity method of accounting because of an observable transaction, existing investments should be remeasured immediately before applying the equity method of accounting. Additionally, it states that if entities hold non-derivative forward contracts or purchased call options to acquire equity securities, such instruments should be measured using the fair value principles of ASC 321 before settlement or exercise. The guidance is effective for the Company’s fiscal year beginning on January 1, 2021, with early adoption permitted. We are assessing the impact that the adoption of this guidance will have on our financial statements. | ||||||||||||
Cash flow hedge [Member] | Foreign exchange contracts [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Gain (loss) reclassified from Accumulated OCI into earnings | 4,100,000 | 2,200,000 | 400,000 | ||||||||||
Estimated amount of net derivative gain in other comprehensive income reclassified to earnings within 12 months | $ 2,300,000 | 2,300,000 | |||||||||||
Minimum [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Reasonably possible decrease in unrecognized tax benefits | 3,100,000 | 3,100,000 | |||||||||||
Maximum [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Reasonably possible decrease in unrecognized tax benefits | 3,800,000 | 3,800,000 | |||||||||||
Selling, general and administrative Expenses [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Impairment of long-lived asset | 5,100,000 | ||||||||||||
Customer program costs | 66,300,000 | 66,500,000 | 62,400,000 | ||||||||||
Shipping and handling costs | 225,500,000 | 215,900,000 | 204,700,000 | ||||||||||
Advertising costs | 177,700,000 | 171,200,000 | 167,600,000 | ||||||||||
Cost of products sold [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Impairment of long-lived asset | 1,700,000 | ||||||||||||
Cost of products sold [Member] | Foreign exchange contracts [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Gain (loss) reclassified from Accumulated OCI into earnings | 4,100,000 | 2,200,000 | $ 400,000 | ||||||||||
Metals inventories [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
LIFO inventories | $ 0 | $ 0 | $ 0 | ||||||||||
Change in Accounting Method Accounted for as Change in Estimate [Member] | |||||||||||||
Significant Of Accounting Policies [Line Items] | |||||||||||||
Adjustment to cost of inventories to FIFO pre-tax benefit | $ 7,300,000 | ||||||||||||
Adjustment To Cost Of Inventories to FIFO Post Tax Benefit | $ 5,500,000 |
Significant Accounting Polici_5
Significant Accounting Policies - Estimated Useful Lives of Property, Plant and Equipment (Detail) | 12 Months Ended |
Dec. 31, 2019 | |
Buildings and Leasehold Improvements | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 15 years |
Buildings and Leasehold Improvements | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 40 years |
Machinery and Equipment | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 3 years |
Machinery and Equipment | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 15 years |
Software | Minimum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 3 years |
Software | Maximum [Member] | |
Property Plant And Equipment [Line Items] | |
Property, plant and equipment, estimated useful life | 7 years |
Balance Sheet Information - Sup
Balance Sheet Information - Supplemental Information on Balance Sheets (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Inventories: | |||
Raw materials and supplies | $ 274.4 | $ 227.4 | |
Work in process | 72.2 | 66.4 | |
Finished products | 372 | 385.1 | |
Total inventories | 718.6 | 678.9 | |
Property, plant and equipment: | |||
Land and improvements | 66.3 | 66.8 | |
Buildings and improvements to leaseholds | 510.2 | 500.1 | |
Machinery and equipment | 1,316.2 | 1,249 | |
Construction in progress | 89.8 | 95.8 | |
Property, plant and equipment, gross | 1,982.5 | 1,911.7 | |
Less: accumulated depreciation | 1,158.3 | 1,098.3 | |
Property, plant and equipment, net of accumulated depreciation | 824.2 | 813.4 | $ 740 |
Other current liabilities: | |||
Accrued salaries, wages and other compensation | 109.7 | 85.9 | |
Accrued customer programs | 179.5 | 167.8 | |
Accrued taxes | 39.3 | 57.7 | |
Dividends payable | 33.5 | 30.9 | |
Other accrued expenses | 187.6 | 165.8 | |
Total other current liabilities | $ 549.6 | $ 508.1 |
Acquisitions and Dispositions -
Acquisitions and Dispositions - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Sep. 30, 2018 | Apr. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | ||||||
Loss on sale of product line | $ (2.4) | $ (2.4) | ||||
Asset impairment charges | $ 3.2 | $ 3.2 | $ 41.5 | $ 62.6 | $ 3.2 | |
Fiberon [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition consideration price paid | $ 470 | |||||
Business acquisition, membership interest acquired | 100.00% | |||||
Victoria Plus Albert and Shaws [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business acquisition consideration price paid | 165 | |||||
Business acquisition additional purchase price consideration | $ 38.9 |
Acquisitions and Dispositions_2
Acquisitions and Dispositions - Final Allocation of Purchase Price to Fair Value of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | ||||
Goodwill | [1] | $ 2,090.2 | $ 2,080.3 | $ 1,912 |
Fiberon [Member] | ||||
Business Acquisition [Line Items] | ||||
Accounts receivable | 18.8 | |||
Inventories | 50.9 | |||
Property, plant and equipment | 45.7 | |||
Goodwill | 177.7 | |||
Identifiable intangible assets | 195 | |||
Other assets | 4.8 | |||
Total assets | 492.9 | |||
Accounts payable | 16.8 | |||
Other liabilities and accruals | 16.3 | |||
Net assets acquired | $ 459.8 | |||
[1] | Net of accumulated impairment losses of $399.5 million in the Doors & Security segment. |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Loss on discontinued operations | $ (0.2) | $ (0.2) | $ (2.6) |
Waterloo Tool Storage and Simonton Window Business | |||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||
Loss on discontinued operations | $ (0.2) | $ (2.6) |
Goodwill and Identifiable Int_3
Goodwill and Identifiable Intangible Assets - Additional Information (Detail) $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2019USD ($)asset-group | Dec. 31, 2017USD ($) | ||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Goodwill | [1] | $ 2,090.2 | $ 2,080.3 | $ 2,090.2 | $ 1,912 | ||
Other intangible assets, net of accumulated amortization | 1,168.9 | 1,246.8 | 1,168.9 | ||||
Expected intangible amortization expense in 2020 | 42 | 42 | |||||
Expected intangible amortization expense in 2021 | 42 | 42 | |||||
Expected intangible amortization expense in 2022 | 40 | 40 | |||||
Expected intangible amortization expense in 2023 | 39 | 39 | |||||
Expected intangible amortization expense in 2024 | 38 | 38 | |||||
Gross Carrying Amounts, Indefinite-lived tradenames | 635.6 | 673.9 | $ 635.6 | ||||
Tradenames and Customer Relationship [Member] | Minimum [Member] | |||||||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Amortizable identifiable intangible assets, estimated useful life | 2 years | ||||||
Tradenames and Customer Relationship [Member] | Maximum [Member] | |||||||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Amortizable identifiable intangible assets, estimated useful life | 30 years | ||||||
Cabinets [Member] | |||||||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Goodwill | [1] | 925.5 | 924 | $ 925.5 | $ 926.3 | ||
Decrease in gross identifiable intangible assets | 34 | ||||||
Impairment of intangible assets, trade names | $ 41.5 | ||||||
Number of tradenames | asset-group | 3 | ||||||
Cabinets [Member] | Trade Names [Member] | |||||||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Impairment of intangible assets, trade names | 12 | ||||||
Gross Carrying Amounts, Indefinite-lived tradenames | 38.6 | $ 38.6 | |||||
Cabinets [Member] | Second Indefinite-Lived Trade Name [Member] | |||||||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Impairment of intangible assets, trade names | $ 29.5 | $ 35.5 | |||||
Gross Carrying Amounts, Indefinite-lived tradenames | 85 | 85 | |||||
Cabinets [Member] | Third Indefinite Lived-Trade Name [Member] | |||||||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Impairment of intangible assets, trade names | $ 27.1 | ||||||
Gross Carrying Amounts, Indefinite-lived tradenames | $ 39.1 | $ 39.1 | |||||
Cabinets [Member] | Maximum [Member] | Second Indefinite-Lived Trade Name [Member] | |||||||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Estimated fair value in excess of carrying amount | 10.00% | ||||||
Cabinets [Member] | Maximum [Member] | Third Indefinite Lived-Trade Name [Member] | |||||||
Goodwill and Identifiable Intangible Assets [Line Items] | |||||||
Estimated fair value in excess of carrying amount | 10.00% | ||||||
[1] | Net of accumulated impairment losses of $399.5 million in the Doors & Security segment. |
Goodwill and Identifiable Int_4
Goodwill and Identifiable Intangible Assets - Change in Net Carrying Amount of Goodwill by Segment (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | ||
Goodwill [Line Items] | |||
Beginning Balance | [1] | $ 2,080.3 | $ 1,912 |
Translation adjustments | 5.6 | (9.6) | |
Acquisition-related adjustments | 4.3 | 177.9 | |
Ending Balance | [1] | 2,090.2 | 2,080.3 |
Cabinets [Member] | |||
Goodwill [Line Items] | |||
Beginning Balance | [1] | 924 | 926.3 |
Translation adjustments | 1.5 | (2.3) | |
Ending Balance | [1] | 925.5 | 924 |
Plumbing [Member] | |||
Goodwill [Line Items] | |||
Beginning Balance | [1] | 743.7 | 745.2 |
Translation adjustments | 3.6 | (5.9) | |
Acquisition-related adjustments | 4.4 | ||
Ending Balance | [1] | 747.3 | 743.7 |
Doors & Security [Member] | |||
Goodwill [Line Items] | |||
Beginning Balance | [1] | 412.6 | 240.5 |
Translation adjustments | 0.5 | (1.4) | |
Acquisition-related adjustments | 4.3 | 173.5 | |
Ending Balance | [1] | $ 417.4 | $ 412.6 |
[1] | Net of accumulated impairment losses of $399.5 million in the Doors & Security segment. |
Goodwill and Identifiable Int_5
Goodwill and Identifiable Intangible Assets - Change in Net Carrying Amount of Goodwill by Segment (Parenthetical) (Detail) $ in Millions | Dec. 31, 2019USD ($) |
Doors & Security [Member] | |
Goodwill [Line Items] | |
Accumulated impairment losses | $ 399.5 |
Goodwill and Identifiable Int_6
Goodwill and Identifiable Intangible Assets - Gross Carrying Value and Accumulated Amortization by Class of Identifiable Intangible Assets (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Intangible Assets [Line Items] | ||
Gross Carrying Amounts, Indefinite-lived tradenames | $ 635.6 | $ 673.9 |
Net Book Value, Indefinite-lived tradenames | 635.6 | 673.9 |
Gross Carrying Amounts, Finite Lived | 897.9 | 893.6 |
Accumulated Amortization, Finite Lived | (364.6) | (320.7) |
Net Book Value, Finite Lived | 533.3 | 572.9 |
Gross Carrying Amounts, Total identifiable intangibles | 1,533.5 | 1,567.5 |
Accumulated Amortization, Total identifiable intangibles | (364.6) | (320.7) |
Net Book Value, Total identifiable intangibles | 1,168.9 | 1,246.8 |
Tradenames [Member] | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amounts, Finite Lived | 20.6 | 19.8 |
Accumulated Amortization, Finite Lived | (12.9) | (11.9) |
Net Book Value, Finite Lived | 7.7 | 7.9 |
Customer and contractual relationships [Member] | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amounts, Finite Lived | 803.9 | 800.3 |
Accumulated Amortization, Finite Lived | (299.6) | (260.2) |
Net Book Value, Finite Lived | 504.3 | 540.1 |
Patents/proprietary technology [Member] | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amounts, Finite Lived | 73.4 | 73.5 |
Accumulated Amortization, Finite Lived | (52.1) | (48.6) |
Net Book Value, Finite Lived | $ 21.3 | $ 24.9 |
Leases - Additional Information
Leases - Additional Information (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 51 |
Variable lease cost | $ 8.2 |
Leases - Other Information Rela
Leases - Other Information Related to Leases (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cash paid for amounts included in the measurement of lease liabilities: | |
Operating cash flows from operating leases | $ 41.3 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 24.5 |
Weighted average remaining lease term - operating leases | 7 years 1 month 6 days |
Weighted average discount rate - operating leases | 4.20% |
Leases - Total Lease Payments U
Leases - Total Lease Payments Under Non-Cancellable Leases (Detail) $ in Millions | Dec. 31, 2019USD ($) |
Operating Leased Assets [Line Items] | |
2020 | $ 39.1 |
2021 | 33.4 |
2022 | 26.8 |
2023 | 22.6 |
2024 | 18.9 |
Thereafter | 61.4 |
Total lease payments | 202.2 |
Less imputed interest | (29.3) |
Total minimum rental payments | 172.9 |
Other Current Liabilities [Member] | |
Operating Leased Assets [Line Items] | |
Operating lease liabilities | 33.1 |
Operating leases liabilities [Member] | |
Operating Leased Assets [Line Items] | |
Operating lease liabilities | $ 139.8 |
Asset Impairment Charges - Addi
Asset Impairment Charges - Additional information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Apr. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |||||
Asset impairment charge | $ 3,200,000 | $ 3,200,000 | $ 41,500,000 | $ 62,600,000 | $ 3,200,000 |
Definite-lived intangible assets | 3,000,000 | $ 0 | |||
Fixed Assets | $ 200,000 |
External Debt and Financing A_3
External Debt and Financing Arrangements - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | ||||||
Aggregate outstanding notes | $ 2,200 | |||||
Repayment of long-term debt | 1,345 | $ 1,890 | $ 565 | |||
Term loan maturity period | 2019-03 | |||||
Uncommitted bank lines of credit, which provide for unsecured borrowings for working capital | $ 17.5 | $ 23.5 | ||||
Weighted-average interest rates on borrowings | 0.00% | 0.00% | ||||
Term Loan Facility [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Senior unsecured notes, price | $ 350 | |||||
Repayment of long-term debt | 350 | |||||
Term loan maturity period | 2020-03 | |||||
Term loan, outstanding borrowings | $ 0 | $ 525 | ||||
Debt instrument, description | In September 2019, the Company used the proceeds from the 2019 Notes to repay the full outstanding balance on the Term Loan entered into in March 2018 and subsequently amended in August 2018 and March 2019 (the “Term Loan”). Following the March 2019 amendment, the Term Loan provided for borrowings of $350 million and was scheduled to mature in March 2020. | |||||
2019 Senior Notes [Member] | Notes due 2029 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Senior unsecured notes, price | $ 700 | |||||
Senior unsecured notes, maturity year | 2029 | |||||
Senior unsecured notes, coupon rate | 3.25% | |||||
2018 Senior Notes [Member] | Notes due 2023 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Senior unsecured notes, price | $ 600 | |||||
Senior unsecured notes, maturity year | 2023 | |||||
Senior unsecured notes, coupon rate | 4.00% | |||||
Senior Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Senior unsecured notes, price | $ 2,200 | |||||
Long-term debt payments in 2020 | 400 | |||||
Long-term debt payments in 2021 | 0 | |||||
Long-term debt payments in 2022 | 0 | |||||
Long-term debt payments in 2023 | 600 | |||||
Long-term debt payments in 2023 through 2024 | $ 600 | |||||
2019 Revolving Credit Agreement [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,250 | |||||
Term loan maturity period | 2024-09 | |||||
Rollover amount from prior credit facility included in current facility | $ 165 | |||||
Debt Instrument, Description of Variable Rate Basis | Interest rates under the 2019 Revolving Credit Agreement are variable based on LIBOR at the time of the borrowing and the Company’s long-term credit rating and can range from LIBOR + 0.91% to LIBOR + 1.4%. | |||||
Debt instrument, covenant description | The amendment also includes a covenant under which the Company is required to maintain a minimum ratio of consolidated EBITDA to consolidated interest expense of 3.0 to 1.0. Adjusted EBITDA is defined as consolidated net income before interest expense, income taxes, depreciation, amortization of intangible assets, losses from asset impairments, and certain other one-time adjustments. In addition, the amendment includes a covenant under which the Company’s ratio of consolidated debt minus certain cash and cash equivalents to consolidated EBITDA generally may not exceed 3.5 to 1.0. | |||||
Required minimum ratio of consolidated EBITDA to consolidated interest expense | 3 | |||||
Ratio of consolidated debt minus certain cash and cash equivalents to consolidated EBITDA | 3.5 | |||||
Term loan, outstanding borrowings | $ 0 | $ 320 | ||||
2019 Revolving Credit Agreement [Member] | LIBOR [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate over LIBOR | 0.91% | |||||
2019 Revolving Credit Agreement [Member] | LIBOR [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate over LIBOR | 1.40% |
External Debt and Financing A_4
External Debt and Financing Arrangements - Summary of Outstanding Notes (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | ||
Net Carrying Value | $ 2,184.3 | $ 2,334 |
Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | 2,200 | |
Net Carrying Value | 2,184.3 | 1,489 |
3.000% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | $ 400 | |
Issuance Date | 2015-06 | |
Maturity Date | 2020-06 | |
Net Carrying Value | $ 399.7 | 399 |
4.000% Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | $ 500 | |
Issuance Date | 2015-06 | |
Maturity Date | 2025-06 | |
Net Carrying Value | $ 495.8 | 495 |
4.000% Senior Notes [Member] | 2018 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | $ 600 | |
Issuance Date | 2018-09 | |
Maturity Date | 2023-09 | |
Net Carrying Value | $ 596.1 | $ 595 |
3.250% Senior Notes [Member] | 2019 Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Principal Amount | $ 700 | |
Issuance Date | 2019-09 | |
Maturity Date | 2029-09 | |
Net Carrying Value | $ 692.7 |
External Debt and Financing A_5
External Debt and Financing Arrangements - Components of Long-Term Debt (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 2,184.3 | $ 2,334 |
Less: current portion | 399.7 | 525 |
Long-term debt | 1,784.6 | 1,809 |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | 320 | |
Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 2,184.3 | 1,489 |
Term Loan [Member] | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 525 |
External Debt and Financing A_6
External Debt and Financing Arrangements - Components of Long-Term Debt (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,250 | $ 1,250 |
Revolving credit facility, expiration date | 2024-09 | 2024-09 |
Term Loan [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument, maturity date | 2020-03 | 2020-03 |
Financial Instruments - Additio
Financial Instruments - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Derivative [Line Items] | |||
Net settlement asset | $ 700,000 | ||
Derivative instrument gain (loss) | 4,800,000 | $ 10,100,000 | $ (1,800,000) |
Foreign exchange contracts [Member] | |||
Derivative [Line Items] | |||
Notional amount of foreign currency derivative hedges | 388,800,000 | ||
Cash flow hedge [Member] | |||
Derivative [Line Items] | |||
Derivative instrument gain (loss) | 4,800,000 | $ 10,100,000 | $ (1,800,000) |
Cash flow hedge [Member] | Foreign exchange contracts [Member] | |||
Derivative [Line Items] | |||
Estimated amount of net derivative gain in accumulated other comprehensive income reclassified to earnings within 12 months | $ 2,300,000 | ||
Minimum [Member] | |||
Derivative [Line Items] | |||
Foreign exchange contracts period | 12 months | ||
Maximum [Member] | |||
Derivative [Line Items] | |||
Foreign exchange contracts period | 15 months |
Financial Instruments - Fair Va
Financial Instruments - Fair Values of Derivative Instruments (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 3 | $ 6 |
Derivative liabilities, fair value | 2.5 | 1.9 |
Net investment hedges [Member] | Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 0.7 | |
Net investment hedges [Member] | Other Current Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | 0.3 | |
Foreign exchange contracts [Member] | Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | 2.9 | 5.3 |
Foreign exchange contracts [Member] | Other Current Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities, fair value | 2.2 | $ 1.9 |
Commodity Contracts [Member] | Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets, fair value | $ 0.1 |
Financial Instruments - Classif
Financial Instruments - Classification and Amount of Gain (Loss) Recognized in Income on Fair Value and Cash Flow Hedging Relationships (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Cost of products sold [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | $ 3,712.2 | $ 3,525.7 | $ 3,358.3 |
Cost of products sold [Member] | Foreign exchange contracts [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income | 4.1 | 2.2 | 0.4 |
Cost of products sold [Member] | Commodity Contracts [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income | (0.1) | (0.2) | 0.5 |
Interest expense [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | 94.2 | 74.5 | 49.4 |
Interest expense [Member] | Interest rate contracts [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Amount of gain or (loss) reclassified from accumulated other comprehensive (loss) income into income | 0.4 | 0.1 | |
Other expense, net [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | 29 | ||
Other expense, net [Member] | Foreign exchange contracts [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | 4 | ||
Other expense, net [Member] | Foreign exchange contracts [Member] | Designated as hedging instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | $ (3) | ||
Other income, net [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | 16.3 | 1.7 | |
Other income, net [Member] | Foreign exchange contracts [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | (3.4) | 2.7 | |
Other income, net [Member] | Foreign exchange contracts [Member] | Designated as hedging instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | $ 5 | $ (3.5) |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) | Dec. 31, 2019USD ($) |
Fair Value Disclosures [Abstract] | |
Assets or liabilities measured at fair value on recurring basis | $ 0 |
Fair Value Measurements - Carry
Fair Value Measurements - Carrying Value and Fair Value of Debt (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Carrying Value | Term Loan Facility [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 525 | |
Carrying Value | Senior Unsecured Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 2,184.3 | 1,489 |
Fair Value | Term Loan Facility [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 525 | |
Fair Value | Senior Unsecured Notes [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 2,271.4 | 1,490.4 |
Revolving Credit Facility [Member] | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | 320 | |
Revolving Credit Facility [Member] | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair Value | $ 320 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset financial instruments (level 2) | $ 3 | $ 6 |
Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 15.1 | 15.3 |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative asset financial instruments (level 2) | 3 | 6 |
Deferred compensation program assets (level 2) | 12.1 | 9.3 |
Derivative liability financial instruments (level 2) | $ 2.5 | $ 1.9 |
Capital Stock - Additional Info
Capital Stock - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Equity [Abstract] | |||
Common stock, shares authorized | 750,000,000 | 750,000,000 | |
Common stock, par value | $ 0.01 | $ 0.01 | |
Preferred stock, shares authorized | 60,000,000 | 60,000,000 | |
Preferred stock, par value | $ 0.01 | $ 0.01 | |
Preferred stock, shares outstanding | 0 | ||
Common stock repurchases | 2,039,551 | 12,000,144 | |
Treasury stock purchases | $ 100 | $ 694.6 | $ 214.8 |
Stock repurchase program, remaining authorized repurchase amount | $ 314 | ||
Percentage of increase in quarterly cash dividend | 9.00% | ||
Dividend declared, per share | $ 0.24 |
Capital Stock - Common Stock an
Capital Stock - Common Stock and Treasury Stock Activity (Detail) - shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Common shares | ||
Balance at the beginning of the year | 140,498,981 | 151,906,797 |
Stock plan shares issued | 1,281,198 | 822,878 |
Shares surrendered by optionees | (185,141) | (230,550) |
Common stock repurchases | (2,039,551) | (12,000,144) |
Balance at the end of the year | 139,555,487 | 140,498,981 |
Treasury shares | ||
Balance at the beginning of the year | 40,110,623 | 27,879,929 |
Shares surrendered by optionees | 185,141 | 230,550 |
Common stock repurchases | 2,039,551 | 12,000,144 |
Balance at the end of the year | 42,335,315 | 40,110,623 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive (Loss) Income - Reclassifications Out of Accumulated Other Comprehensive (Loss) Income (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Cost of products sold | $ 3,712.2 | $ 3,525.7 | $ 3,358.3 | |||||||||
Interest expense | 94.2 | 74.5 | 49.4 | |||||||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 575.3 | 537 | 634.8 | |||||||||
Tax (expense) benefit | (144) | (147) | (159.5) | |||||||||
Income from continuing operations, net of tax | $ 104 | $ 105.7 | $ 137.1 | $ 84.5 | $ 85.3 | $ 99.9 | $ 129.7 | $ 75.1 | 431.3 | 390 | 475.3 | |
Reclassification from Accumulated Other Comprehensive Income (Loss), Current Period, Net of Tax | (22) | (1.3) | ||||||||||
Derivative Hedging Losses (Gains) [Member] | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Reclassification from Accumulated Other Comprehensive Income (Loss), Current Period, Net of Tax | 3.8 | 1.7 | 0.8 | |||||||||
Actuarial losses [Member] | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | [1] | (34.1) | (3.8) | |||||||||
Defined benefit plan items [Member] | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Reclassification from AOCI, Current Period, Tax | 8.3 | 0.8 | ||||||||||
Reclassification from Accumulated Other Comprehensive Income (Loss), Current Period, Net of Tax | (25.8) | (3) | $ 3.6 | |||||||||
Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Derivative Hedging Losses (Gains) [Member] | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | 4.4 | 2.1 | ||||||||||
Tax (expense) benefit | (0.6) | (0.4) | ||||||||||
Income from continuing operations, net of tax | 3.8 | 1.7 | ||||||||||
Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Derivative Hedging Losses (Gains) [Member] | Foreign exchange contracts [Member] | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Cost of products sold | 4.1 | 2.2 | ||||||||||
Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Derivative Hedging Losses (Gains) [Member] | Interest rate contracts [Member] | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Interest expense | 0.4 | 0.1 | ||||||||||
Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Derivative Hedging Losses (Gains) [Member] | Commodity Contracts [Member] | ||||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||||||||
Cost of products sold | $ (0.1) | $ (0.2) | ||||||||||
[1] | These accumulated other comprehensive (loss) income components are included in the computation of net periodic benefit cost. Refer to Note 16, “Defined Benefit Plans,” for additional information. |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive (Loss) Income - After-Tax Components of and Changes in Accumulated Other Comprehensive (Loss) Income (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | $ 2,180 | $ 2,601.1 | $ 2,363 |
Amounts reclassified from accumulated other comprehensive (loss) income into earnings | 22 | 1.3 | |
Ending Balance | 2,427.8 | 2,180 | 2,601.1 |
ASU 2018-02 [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Amounts reclassified from accumulated other comprehensive (loss) income into earnings | (8.6) | ||
Foreign Currency Adjustments [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | (25.3) | 5.8 | (28) |
Amounts classified into accumulated other comprehensive (loss) income | 13.8 | (31.1) | 33.8 |
Other comprehensive (loss) income, net of tax | 13.8 | (31.1) | 33.8 |
Ending Balance | (11.5) | (25.3) | 5.8 |
Derivative Hedging Losses (Gains) [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | 4.2 | (2.4) | (0.6) |
Amounts classified into accumulated other comprehensive (loss) income | 5.1 | 8.3 | (1) |
Amounts reclassified from accumulated other comprehensive (loss) income into earnings | (3.8) | (1.7) | (0.8) |
Other comprehensive (loss) income, net of tax | 1.3 | 6.6 | (1.8) |
Ending Balance | 5.5 | 4.2 | (2.4) |
Defined benefit plan items [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | (45.9) | (42.6) | (43.3) |
Amounts classified into accumulated other comprehensive (loss) income | (37.9) | (6.3) | 4.3 |
Amounts reclassified from accumulated other comprehensive (loss) income into earnings | 25.8 | 3 | (3.6) |
Other comprehensive (loss) income, net of tax | (20.7) | (3.3) | 0.7 |
Ending Balance | (66.6) | (45.9) | (42.6) |
Defined benefit plan items [Member] | ASU 2018-02 [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Adoption of ASU 2018-02 | (8.6) | ||
Accumulated Other Comprehensive (Loss) Income [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Beginning Balance | (67) | (39.2) | (71.9) |
Amounts classified into accumulated other comprehensive (loss) income | (19) | (29.1) | 37.1 |
Amounts reclassified from accumulated other comprehensive (loss) income into earnings | 22 | 1.3 | (4.4) |
Other comprehensive (loss) income, net of tax | (5.6) | (27.8) | 32.7 |
Ending Balance | (72.6) | $ (67) | $ (39.2) |
Accumulated Other Comprehensive (Loss) Income [Member] | ASU 2018-02 [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Adoption of ASU 2018-02 | $ (8.6) |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) $ / shares in Units, term in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)term$ / sharesshares | Dec. 31, 2018USD ($)$ / sharesshares | Dec. 31, 2017USD ($)$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Incentive Plan, common stock available for issuance | shares | 3,400,000 | ||
Number of long term incentive plans | term | 2 | ||
Incentive Plan, options vesting period | 3 years | ||
Unrecognized compensation cost, weighted-average recognition period | 1 year 9 months 18 days | ||
Incentive Plan, options maturity period | 10 years | ||
Incentive Plan, weighted-average grant date fair value of stock options granted | $ / shares | $ 11.36 | $ 14.14 | $ 13.49 |
Unrecognized compensation cost related to unvested option | $ 4.9 | ||
Fair value of options vested | 7.1 | $ 6.7 | $ 6.8 |
Intrinsic value of stock options exercised | $ 26 | 8.7 | 70.6 |
Performance Condition Achievement | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Vested | shares | (186,249) | ||
Restricted Stock Units | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Compensation costs classified as liability | $ 1.4 | ||
Incentive Plan, options vesting period | 3 years | ||
Unrecognized pre-tax compensation cost | $ 19.2 | ||
Fair value of performance share awards vested | $ 15.2 | $ 22.2 | $ 20.3 |
Stock Option Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized compensation cost, weighted-average recognition period | 1 year 7 months 6 days | ||
Performance Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Unrecognized pre-tax compensation cost | $ 7 | ||
Unrecognized compensation cost, weighted-average recognition period | 1 year 9 months 18 days | ||
Fair value of performance share awards vested | $ 8.3 | ||
Vested | shares | (126,700) | ||
Director Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock awards issued | shares | 21,746 | 19,109 | 15,311 |
Common stock issued to outside directors | $ / shares | $ 54.48 | $ 54.93 | $ 63.43 |
Stock-Based Compensation - Pre-
Stock-Based Compensation - Pre-Tax Stock-Based Compensation Expense from Continuing Operations (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | $ 31.8 | $ 37.2 | $ 43.6 |
Tax benefit | 6 | 6.2 | 15.2 |
Total after tax expense | 25.8 | 31 | 28.4 |
Stock Option Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | 7 | 8.6 | 7.4 |
Restricted Stock Units | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | 19.4 | 21.3 | 21.6 |
Performance Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | 4.2 | 6.3 | 13.6 |
Director Awards | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Stock-based compensation | $ 1.2 | $ 1 | $ 1 |
Stock-Based Compensation - Rest
Stock-Based Compensation - Restricted Stock Units Activity (Detail) - Restricted Stock Units | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Number of Restricted Stock Units | |
Non-vested at December 31, 2018 | shares | 660,375 |
Granted | shares | 468,617 |
Vested | shares | (314,482) |
Forfeited | shares | (58,028) |
Non-vested at December 31, 2019 | shares | 756,482 |
Weighted-Average Grant-Date Fair Value | |
Non-vested at December 31, 2018 | $ / shares | $ 58.63 |
Granted | $ / shares | 49.46 |
Vested | $ / shares | 57.51 |
Forfeited | $ / shares | 52.78 |
Non-vested at December 31, 2019 | $ / shares | $ 53.89 |
Stock-Based Compensation - Blac
Stock-Based Compensation - Black-Scholes Option Pricing Model Assumptions used to Estimate Fair Value of Options (Detail) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |||
Current expected dividend yield | 1.50% | 1.30% | 1.40% |
Expected volatility | 27.00% | 24.00% | 26.00% |
Risk-free interest rate | 2.50% | 2.60% | 1.90% |
Expected term | 5 years | 5 years | 5 years 6 months |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Option Activity (Detail) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Options | |
Outstanding at December 31, 2018 | shares | 4,023,822 |
Granted | shares | 652,559 |
Exercised | shares | (760,807) |
Expired/forfeited | shares | (90,358) |
Outstanding at December 31, 2019 | shares | 3,825,216 |
Weighted-Average Exercise Price | |
Outstanding at December 31, 2018 | $ / shares | $ 40.83 |
Granted | $ / shares | 47.85 |
Exercised | $ / shares | 22.71 |
Expired/forfeited | $ / shares | 56.35 |
Outstanding at December 31, 2019 | $ / shares | $ 45.27 |
Stock-Based Compensation - Opti
Stock-Based Compensation - Options Outstanding and Exercisable (Detail) | 12 Months Ended | |
Dec. 31, 2019$ / sharesshares | ||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | ||
Options Outstanding | shares | 3,825,216 | [1] |
Options Outstanding, Weighted-Average Remaining Contractual Life | 5 years 9 months 18 days | [1] |
Options Outstanding, Weighted-Average Exercise Price | $ 45.27 | [1] |
Options Exercisable | shares | 2,668,237 | [2] |
Options Exercisable, Weighted-Average Exercise Price | $ 41.39 | [2] |
Exercise Price Range One | ||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | ||
Range of Exercise Prices, Lower limit | 13 | |
Range of Exercise Prices, upper limit | $ 20 | |
Options Outstanding | shares | 623,901 | [1] |
Options Outstanding, Weighted-Average Remaining Contractual Life | 1 year 8 months 12 days | [1] |
Options Outstanding, Weighted-Average Exercise Price | $ 16.74 | [1] |
Options Exercisable | shares | 623,901 | [2] |
Options Exercisable, Weighted-Average Exercise Price | $ 16.74 | [2] |
Exercise Price Range Two | ||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price Range [Line Items] | ||
Range of Exercise Prices, Lower limit | 20.01 | |
Range of Exercise Prices, upper limit | $ 65.41 | |
Options Outstanding | shares | 3,201,315 | [1] |
Options Outstanding, Weighted-Average Remaining Contractual Life | 6 years 7 months 6 days | [1] |
Options Outstanding, Weighted-Average Exercise Price | $ 50.83 | [1] |
Options Exercisable | shares | 2,044,336 | [2] |
Options Exercisable, Weighted-Average Exercise Price | $ 48.91 | [2] |
[1] | At December 31, 2019, the aggregate intrinsic value of options outstanding was $76.8 million. | |
[2] | At December 31, 2019 the weighted-average remaining contractual life of options exercisable was 4.6 years and the aggregate intrinsic value of options exercisable was $63.9 million. |
Stock-Based Compensation - Op_2
Stock-Based Compensation - Options Outstanding and Exercisable (Parenthetical) (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Options outstanding, aggregate intrinsic value | $ 76.8 |
Options exercisable, weighted-average remaining contractual life | 4 years 7 months 6 days |
Options exercisable, aggregate intrinsic value | $ 63.9 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summarizes Information of Performance Share Awards (Detail) - Performance Awards | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Non-vested at December 31, 2018 | shares | 409,091 |
Granted | shares | 310,471 |
Vested | shares | (126,700) |
Forfeited | shares | (37,205) |
Non-vested at December 31, 2019 | shares | 555,657 |
Non-vested at December 31, 2018 | $ / shares | $ 57.50 |
Granted | $ / shares | 47.77 |
Vested | $ / shares | 50.85 |
Forfeited | $ / shares | 55.74 |
Non-vested at December 31, 2019 | $ / shares | $ 53.71 |
Revenue - Additional Informatio
Revenue - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | ||
Payment term on product sales range, description | Payment terms on our product sales normally range from 30 to 90 days. | |
Other current liabilities [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Refund obligation | $ 16.9 | $ 14.8 |
Other Current Assets [Member] | ||
Disaggregation of Revenue [Line Items] | ||
Contract with customer, right to recover product, current | $ 2.6 | $ 2.3 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | ||
Disaggregation of Revenue [Line Items] | |||
Net sales | $ 5,764.6 | $ 5,485.1 | |
Wholesalers [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | [1] | 2,682.8 | 2,607.3 |
Home Center retailers [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | [2] | 1,606.7 | 1,452.3 |
Other retailers [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | [3] | 304.8 | 311.6 |
Builder direct [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 229.4 | 235.4 | |
United States [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | 4,823.7 | 4,606.6 | |
International [Member] | |||
Disaggregation of Revenue [Line Items] | |||
Net sales | [4] | $ 940.9 | $ 878.5 |
[1] | Represents sales to customers whose business is oriented towards builders, professional trades and home remodelers, inclusive of sales through our customers’ respective internet website portals. | ||
[2] | Represents sales to the three largest “Do-It-Yourself” retailers; The Home Depot, Inc., Lowes Companies, Inc. and Menards, Inc., inclusive of sales through their respective internet website portals. | ||
[3] | Represents sales principally to our mass merchant and standalone independent e-commerce customers. | ||
[4] | Represents sales in markets outside the United States, principally in Canada, China, Europe and Mexico. |
Defined Benefit Plans - Additio
Defined Benefit Plans - Additional Information (Detail) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019USD ($)age | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined Contribution Plan, cash contributions | $ | $ 36.3 | $ 29.5 | $ 29.1 |
Cash and cash equivalents | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit asset allocation, maximum | 25.00% | ||
Other Investment | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit asset allocation, maximum | 20.00% | ||
Real estate [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Assets redemption notice period | 45 days | ||
Investment Assets [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Assets redemption notice period | 95 days | ||
Fair Value Measured at Net Asset Value Per Share [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Investments measured using net asset value per share | $ | $ 653 | $ 576 | |
Minimum [Member] | Equity Securities | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit asset allocation, maximum | 0.00% | ||
Minimum [Member] | Fixed income | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit asset allocation, maximum | 25.00% | ||
Maximum [Member] | Equity Securities | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit asset allocation, maximum | 75.00% | ||
Maximum [Member] | Fixed income | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit asset allocation, maximum | 100.00% | ||
Pension Benefits [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit plans, blended long-term rate of return on plan assets | 4.90% | 6.00% | 6.40% |
Pension Benefits [Member] | Minimum [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit plans, retirement benefits payment commencement age | age | 55 | ||
Pension Benefits [Member] | Maximum [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined benefit plans, retirement benefits payment commencement age | age | 65 |
Defined Benefit Plans - Obligat
Defined Benefit Plans - Obligations and Funded Status (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Change in the Projected Benefit Obligation (PBO): | |||
Recognition of actuarial losses (gains) | $ 34.1 | $ 3.8 | $ (0.5) |
Change in Plan Assets: | |||
Beginning balance | 599.6 | ||
Ending balance | 677.2 | 599.6 | |
Pension Benefits [Member] | |||
Change in the Projected Benefit Obligation (PBO): | |||
Projected benefit obligation at beginning of year | 763.2 | 832.4 | |
Service cost | 0.4 | 0.5 | |
Interest cost | 32.9 | 30.7 | |
Recognition of actuarial losses (gains) | 121.6 | (63.1) | |
Benefits paid | (41) | (37.3) | |
Projected benefit obligation at end of year | 877.1 | 763.2 | 832.4 |
Accumulated benefit obligation at end of year (excludes the impact of future compensation increases) | 877.1 | 763.2 | |
Change in Plan Assets: | |||
Beginning balance | 599.6 | 656.6 | |
Actual return on plan assets | 106.8 | (30.7) | |
Employer contributions | 11.8 | 11 | |
Benefits paid | (41) | (37.3) | |
Ending balance | 677.2 | 599.6 | 656.6 |
Funded status (Fair value of plan assets less PBO) | (199.9) | (163.6) | |
Postretirement Benefits [Member] | |||
Change in the Projected Benefit Obligation (PBO): | |||
Projected benefit obligation at beginning of year | 1.4 | 1.6 | |
Service cost | 0.2 | ||
Interest cost | 0.2 | ||
Plan amendments | 1.6 | ||
Recognition of actuarial losses (gains) | 1 | (0.2) | |
Benefits paid | (0.7) | ||
Curtailment gain | (0.1) | ||
Projected benefit obligation at end of year | 3.6 | 1.4 | $ 1.6 |
Change in Plan Assets: | |||
Employer contributions | 0.7 | ||
Benefits paid | (0.7) | ||
Funded status (Fair value of plan assets less PBO) | $ (3.6) | $ (1.4) |
Defined Benefit Plans - Amounts
Defined Benefit Plans - Amounts Recognized in Consolidated Balance Sheets (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Defined Benefit Plan Disclosure [Line Items] | ||
Accrued benefit liability | $ (201.4) | $ (163.3) |
Pension Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Current benefit payment liability | (1.4) | (1.5) |
Accrued benefit liability | (198.5) | (162.1) |
Net amount recognized | (199.9) | (163.6) |
Postretirement Benefits [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Current benefit payment liability | (0.7) | (0.2) |
Accrued benefit liability | (2.9) | (1.2) |
Net amount recognized | $ (3.6) | $ (1.4) |
Defined Benefit Plans - Amoun_2
Defined Benefit Plans - Amounts in Accumulated Other Comprehensive loss that have not yet been Recognized as Components of Net Periodic Benefit Cost (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Recognition of actuarial (loss) gain | $ (34.1) | $ (3.8) | $ 0.5 |
Pension Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Recognition of actuarial (loss) gain | (121.6) | 63.1 | |
Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Recognition of actuarial (loss) gain | (1) | 0.2 | |
Other Accumulated Other Comprehensive Income | Pension Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Beginning Balance | 71.8 | 67.2 | |
Recognition of actuarial (loss) gain | (34.1) | (3.9) | |
Current year actuarial loss (gain) | 50.1 | 8.5 | |
Net actuarial loss due to curtailment | (0.1) | ||
Ending Balance | 87.7 | 71.8 | $ 67.2 |
Other Accumulated Other Comprehensive Income | Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Beginning Balance | (0.3) | ||
Recognition of actuarial (loss) gain | (0.6) | 0.1 | |
Current year actuarial loss (gain) | 0.6 | (0.4) | |
Ending Balance | $ (0.3) | $ (0.3) |
Defined Benefit Plans - Compone
Defined Benefit Plans - Components of Net Periodic Benefit Cost for Pension and Postretirement Benefits (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Recognition of actuarial losses (gains) | $ 34.1 | $ 3.8 | $ (0.5) |
Pension Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 0.4 | 0.5 | |
Interest cost | 32.9 | 30.7 | |
Recognition of actuarial losses (gains) | 121.6 | (63.1) | |
Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 0.2 | ||
Interest cost | 0.2 | ||
Recognition of actuarial losses (gains) | 1 | (0.2) | |
Net Periodic Benefit Cost | Pension Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 0.4 | 0.5 | 0.6 |
Interest cost | 32.9 | 30.7 | 33.3 |
Expected return on plan assets | (35.2) | (41) | (37.3) |
Recognition of actuarial losses (gains) | 34.1 | 3.9 | 0.9 |
Settlement/Curtailment losses (gains) | 0.1 | ||
Net periodic benefit cost (income) | 32.3 | (5.9) | (2.5) |
Net Periodic Benefit Cost | Postretirement Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | 0.2 | ||
Interest cost | 0.2 | ||
Recognition of actuarial losses (gains) | 0.6 | (0.1) | (1.4) |
Settlement/Curtailment losses (gains) | (0.1) | ||
Amortization of prior service credits | 0.2 | (5.1) | |
Net periodic benefit cost (income) | $ 1.1 | $ (0.1) | $ (6.5) |
Defined Benefit Plans - Schedul
Defined Benefit Plans - Schedule of Assumptions Used (Detail) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Pension Benefits [Member] | |||
Weighted-Average Assumptions Used to Determine Benefit Obligations at December 31: | |||
Discount rate | 3.30% | 4.40% | 3.80% |
Weighted-Average Assumptions Used to Determine Net Cost for Years Ended December 31: | |||
Discount rate | 4.40% | 3.80% | 4.30% |
Expected long-term rate of return on plan assets | 4.90% | 6.00% | 6.40% |
Postretirement Benefits [Member] | |||
Weighted-Average Assumptions Used to Determine Benefit Obligations at December 31: | |||
Discount rate | 6.40% | 4.20% | 3.40% |
Weighted-Average Assumptions Used to Determine Net Cost for Years Ended December 31: | |||
Discount rate | 4.20% | 3.40% | 3.40% |
Defined Benefit Plans - Assumed
Defined Benefit Plans - Assumed Health Care Cost Trend Rates Used to Determine Benefit Obligations and Net Cost (Detail) - Postretirement Benefits [Member] | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | ||
Defined Benefit Plan Disclosure [Line Items] | |||
Rate that the cost trend rate is assumed to decline (the ultimate trend rate) | 4.50% | 4.50% | |
Year that the rate reaches the ultimate trend rate | 2027 | 2027 | |
Pre Age Sixty Five | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Health care cost trend rate assumed for next year | [1] | 6.70% | 6.90% |
Post Age Sixty Five | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Health care cost trend rate assumed for next year | [1] | 7.80% | 8.00% |
[1] | The pre-65 initial health care cost trend rate is shown first / followed by the post-65 rate. |
Defined Benefit Plans - Fair Va
Defined Benefit Plans - Fair Value of Pension Assets by Major Category of Plan Assets (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of pension assets | $ 677.2 | $ 599.6 | |
Group annuity/insurance contracts (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of pension assets | 24.2 | 23.6 | $ 23.3 |
Cash and cash equivalents | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of pension assets | 7.8 | 7.7 | |
Equity | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of pension assets | 245.3 | 197.7 | |
Fixed income | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of pension assets | 355 | 324.6 | |
Multi-strategy hedge funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of pension assets | 23.2 | 22 | |
Real estate | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of pension assets | $ 21.7 | $ 24 |
Defined Benefit Plans - Reconci
Defined Benefit Plans - Reconciliation of Level Three Measurements (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Beginning balance | $ 599.6 | |
Ending balance | 677.2 | $ 599.6 |
Group annuity/insurance contracts (Level 3) | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Beginning balance | 23.6 | 23.3 |
Actual return on assets related to assets still held | 0.6 | 0.3 |
Ending balance | $ 24.2 | $ 23.6 |
Defined Benefit Plans - Sched_2
Defined Benefit Plans - Schedule of Expected Benefit Payments (Detail) $ in Millions | Dec. 31, 2019USD ($) |
Pension Benefits [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
2020 | $ 41.2 |
2021 | 42.4 |
2022 | 43.5 |
2023 | 44.5 |
2024 | 45.8 |
Years 2025-2029 | 239.6 |
Postretirement Benefits [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
2020 | 0.4 |
2021 | 0.4 |
2022 | 0.3 |
2023 | 0.3 |
2024 | 0.3 |
Years 2025-2029 | $ 2.1 |
Income Taxes - Components of Lo
Income Taxes - Components of Loss Income Before Income Taxes and Noncontrolling Interests (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Domestic operations | $ 438.2 | $ 456.7 | $ 554.7 |
Foreign operations | 137.1 | 80.3 | 80.1 |
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest | $ 575.3 | $ 537 | $ 634.8 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Taxes [Line Items] | ||||
Reconciliation of income taxes | 35.00% | 21.00% | 21.00% | 35.00% |
Unrecognized tax benefits that would impact effective tax rate | $ 72,400,000 | |||
Unrecognized tax expense (benefits), interest and penalty expense (benefit) recognized | 3,000,000 | $ 2,200,000 | $ 2,000,000 | |
Unrecognized tax benefits, accrued interest and penalties | 16,100,000 | 14,400,000 | ||
Deferred tax assets, net operating losses and other tax carryforwards | 22,400,000 | $ 21,200,000 | ||
Deferred tax assets, net operating losses and other tax carryforwards | 7,900,000 | |||
Undistributed earnings of foreign subsidiaries | 133,600,000 | |||
Deferred tax liabilities of Foreign Subsidiaries | 3,000,000 | |||
Foreign and State Tax [Member] | ||||
Income Taxes [Line Items] | ||||
Income tax liability for foreign and state taxes | 9,700,000 | |||
Minimum [Member] | ||||
Income Taxes [Line Items] | ||||
Reasonably possible decrease in unrecognized tax benefits | $ 3,100,000 | |||
Deferred tax assets, remaining net operating losses and other tax carryforwards expiration period | 2024 | |||
Maximum [Member] | ||||
Income Taxes [Line Items] | ||||
Reasonably possible decrease in unrecognized tax benefits | $ 3,800,000 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Taxes at Federal Statutory Income Tax Rate (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Income tax expense computed at federal statutory income tax rate | $ 120.8 | $ 112.8 | $ 222.2 |
Other income taxes, net of federal tax benefit | 18 | 13.7 | 13.4 |
Foreign taxes at a different rate than U.S. federal statutory income tax rate | 1.4 | 3.5 | (8.3) |
Tax benefit on income attributable to domestic production activities | (10.9) | ||
Net adjustments for uncertain tax positions | 7.5 | 4.1 | 11.6 |
Share-based compensation (ASU 2016-09) | (3.7) | (2.1) | (23.9) |
Tax Act impact | 5.5 | (25.7) | |
Deferred tax impact of state tax rate changes | 3.1 | 3.5 | (2) |
Valuation allowance increase (decrease) | 3.4 | 3 | (5.2) |
Miscellaneous other, net | (6.5) | 3 | (11.7) |
Income tax expense as reported | $ 144 | $ 147 | $ 159.5 |
Effective income tax rate | 25.00% | 27.40% | 25.10% |
Income Taxes - Reconciliation_2
Income Taxes - Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Unrecognized tax benefits—beginning of year | $ 83.5 | $ 87.5 | $ 58.2 |
Gross additions—current year tax positions | 9.2 | 9.1 | 31 |
Gross additions—prior year tax positions | 2.9 | 9.3 | 10.9 |
Gross additions (reductions)—purchase accounting adjustments | 1 | 4 | |
Gross reductions—prior year tax positions | (6.9) | (14.5) | (9.4) |
Gross reductions—settlements with taxing authorities | (0.7) | (8.9) | (7.2) |
Unrecognized tax benefits—end of year | $ 88 | $ 83.5 | $ 87.5 |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current | |||
Federal | $ 94.9 | $ 93.5 | $ 133.1 |
Foreign | 35.1 | 26.4 | 22.4 |
State and other | 21.5 | 24.1 | 22.8 |
Deferred | |||
Federal, state and other | (4.4) | 4.8 | (27.2) |
Foreign | (3.1) | (1.8) | 8.4 |
Income tax expense as reported | $ 144 | $ 147 | $ 159.5 |
Income Taxes - Components of Ne
Income Taxes - Components of Net Deferred Tax Assets Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Compensation and benefits | $ 37.6 | $ 31.5 |
Defined benefit plans | 50.8 | 39.3 |
Capitalized inventories | 18.2 | 16.1 |
Accounts receivable | 5.1 | 5.4 |
Other accrued expenses | 58.8 | 55.2 |
Net operating loss and other tax carryforwards | 22.4 | 21.2 |
Valuation allowance | (16.8) | (13.3) |
Miscellaneous | 3.9 | 2.5 |
Total deferred tax assets | 180 | 157.9 |
Deferred tax liabilities: | ||
Fixed assets | (70.4) | (60.2) |
Intangible assets | (222.9) | (224.6) |
Investment in partnership | (7.4) | (3.8) |
Miscellaneous | (19.2) | (20) |
Total deferred tax liabilities | (319.9) | (308.6) |
Net deferred tax liability | (139.9) | (150.7) |
Other assets | 17.3 | 11.9 |
Deferred income taxes | $ (157.2) | $ (162.6) |
Restructuring and Other Charg_3
Restructuring and Other Charges - Pre-tax Restructuring and Other Charges (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | $ 14.7 | $ 24.1 | $ 8.3 | ||||
Total Charges | 22.2 | 35.4 | 18.5 | ||||
Cost of products sold [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Other Charges | 4.1 | [1] | 12.1 | [2] | 7.2 | [2] | |
Selling, general and administrative Expenses [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Other Charges | [3] | 3.4 | [1] | (0.8) | [2] | 3 | [2] |
Operating Segments [Member] | Cabinets [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 10.2 | 16.8 | 1.4 | ||||
Total Charges | 10.7 | 26.2 | 5.2 | ||||
Operating Segments [Member] | Cabinets [Member] | Cost of products sold [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Other Charges | (0.1) | [1] | 9.1 | [2] | 1.6 | [2] | |
Operating Segments [Member] | Cabinets [Member] | Selling, general and administrative Expenses [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Other Charges | [3] | 0.6 | [1] | 0.3 | [2] | 2.2 | [2] |
Operating Segments [Member] | Plumbing [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 2.8 | 2.6 | 2.8 | ||||
Total Charges | 8.2 | 3.3 | 2.8 | ||||
Operating Segments [Member] | Plumbing [Member] | Cost of products sold [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Other Charges | 2.6 | [1] | 0.6 | [2] | |||
Operating Segments [Member] | Plumbing [Member] | Selling, general and administrative Expenses [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Other Charges | [3] | 2.8 | [1] | 0.1 | [2] | ||
Operating Segments [Member] | Doors & Security [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 1.7 | 4.7 | 4.1 | ||||
Total Charges | 3.3 | 5.9 | 10.5 | ||||
Operating Segments [Member] | Doors & Security [Member] | Cost of products sold [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Other Charges | $ 1.6 | [1] | 2.4 | [2] | 5.6 | [2] | |
Operating Segments [Member] | Doors & Security [Member] | Selling, general and administrative Expenses [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Other Charges | [2],[3] | $ (1.2) | $ 0.8 | ||||
[1] | “Other Charges” represent charges or gains directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such charges or gains may include losses on disposal of inventories, trade receivables allowances from exiting product lines, write-off of displays from exiting a customer relationship, accelerated depreciation resulting from the closure of facilities, and gains and losses on the sale of previously closed facilities. | ||||||
[2] | “Other Charges” represent charges or gains directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such charges or gains may include losses on disposal of inventories, trade receivables allowances from exiting product lines, accelerated depreciation resulting from the closure of facilities, and gains and losses on the sale of previously closed facilities. | ||||||
[3] | Selling, general and administrative expenses |
Restructuring and Other Charg_4
Restructuring and Other Charges - Reconciliation of Restructuring Liability (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | $ 10.5 | $ 5.8 | ||
Provision | 14.7 | 24.1 | $ 8.3 | |
Cash Expenditures | [1] | (18) | (18.7) | |
Non-Cash Write-offs | (0.4) | (0.7) | ||
Ending Balance | 6.8 | 10.5 | 5.8 | |
Workforce Reduction Costs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | 9.9 | 5 | ||
Provision | 13.5 | 21.4 | ||
Cash Expenditures | [1] | (16.6) | (16.3) | |
Non-Cash Write-offs | (0.1) | (0.2) | ||
Ending Balance | 6.7 | 9.9 | 5 | |
Other [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | 0.6 | 0.8 | ||
Provision | 1.2 | 2.7 | ||
Cash Expenditures | [1] | (1.4) | (2.4) | |
Non-Cash Write-offs | (0.3) | (0.5) | ||
Ending Balance | $ 0.1 | $ 0.6 | $ 0.8 | |
[1] | Cash expenditures primarily related to severance charges. |
Commitments - Additional Inform
Commitments - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |||
Purchase obligations | $ 408.5 | ||
Purchase obligations due in one year | $ 373.9 | ||
Operating leases, rent expense net | $ 48.4 | $ 42.1 |
Commitments - Future Minimum Re
Commitments - Future Minimum Rental Payments under Non-Cancelable Operating Leases (Detail) $ in Millions | Dec. 31, 2018USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2019 | $ 37.8 |
2020 | 29.6 |
2021 | 23.4 |
2022 | 18.9 |
2023 | 13.8 |
Remainder | 58.8 |
Total minimum rental payments | $ 182.3 |
Commitments - Activity Related
Commitments - Activity Related to Product Warranty Liability (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |||
Reserve balance at the beginning of the year | $ 24.9 | $ 17.2 | $ 16.2 |
Provision for warranties issued | 25.4 | 25.1 | 25.1 |
Settlements made (in cash or in kind) | (25.8) | (25.7) | (24.3) |
Acquisition | 8.9 | ||
Foreign currency | 0.2 | (0.6) | 0.2 |
Reserve balance at end of year | $ 24.7 | $ 24.9 | $ 17.2 |
Information on Business Segme_3
Information on Business Segments - Net Sales and Operating Income by Segment (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Net sales | $ 1,470,500,000 | $ 1,459,000,000 | $ 1,507,200,000 | $ 1,327,900,000 | $ 1,420,700,000 | $ 1,380,800,000 | $ 1,429,000,000 | $ 1,254,600,000 | $ 5,764,600,000 | $ 5,485,100,000 | $ 5,283,300,000 | ||
Operating income | 192,500,000 | $ 168,000,000 | $ 202,400,000 | $ 135,600,000 | 140,100,000 | $ 147,100,000 | $ 188,600,000 | $ 119,400,000 | 698,500,000 | 595,200,000 | 682,500,000 | ||
Long-lived asset impairment | $ (3,000,000) | 0 | |||||||||||
Assets | 6,291,300,000 | 5,964,600,000 | 6,291,300,000 | 5,964,600,000 | 5,511,400,000 | ||||||||
Depreciation expense | 111,300,000 | 113,500,000 | 98,600,000 | ||||||||||
Amortization of intangible assets | 41,400,000 | 36,100,000 | 31,700,000 | ||||||||||
Capital expenditures, gross | [1] | 131,800,000 | 150,100,000 | 165,000,000 | |||||||||
Less: proceeds from disposition of assets | (4,200,000) | (6,100,000) | (400,000) | ||||||||||
Capital expenditures, net | 127,600,000 | 144,000,000 | 164,600,000 | ||||||||||
Property, plant and equipment, net | 824,200,000 | 813,400,000 | 824,200,000 | 813,400,000 | 740,000,000 | ||||||||
United States [Member] | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Net sales | [2] | 4,823,700,000 | 4,606,600,000 | 4,492,200,000 | |||||||||
Property, plant and equipment, net | 641,900,000 | 628,900,000 | 641,900,000 | 628,900,000 | 562,300,000 | ||||||||
Canada | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Net sales | [2] | 401,000,000 | 433,100,000 | 427,600,000 | |||||||||
Property, plant and equipment, net | 43,900,000 | 46,000,000 | 43,900,000 | 46,000,000 | 50,500,000 | ||||||||
China | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Net sales | [2] | 355,400,000 | 260,600,000 | 202,300,000 | |||||||||
Property, plant and equipment, net | 22,500,000 | 22,500,000 | 22,500,000 | 22,500,000 | 24,800,000 | ||||||||
Other International | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Net sales | [2] | 184,500,000 | 184,800,000 | 161,200,000 | |||||||||
Property, plant and equipment, net | 12,700,000 | 12,600,000 | 12,700,000 | 12,600,000 | 13,400,000 | ||||||||
Mexico | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Property, plant and equipment, net | 103,200,000 | 103,400,000 | 103,200,000 | 103,400,000 | 89,000,000 | ||||||||
Corporate [Member] | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Operating income | [3] | (79,700,000) | (79,200,000) | (90,100,000) | |||||||||
General and administrative expense | (79,700,000) | (79,200,000) | (85,000,000) | ||||||||||
Long-lived asset impairment | (5,100,000) | ||||||||||||
Total Corporate expenses | (79,700,000) | (79,200,000) | (90,100,000) | ||||||||||
Assets | 228,200,000 | 176,800,000 | 228,200,000 | 176,800,000 | 208,800,000 | ||||||||
Depreciation expense | 2,700,000 | 3,300,000 | 3,000,000 | ||||||||||
Capital expenditures, gross | 1,600,000 | 600,000 | 18,000,000 | ||||||||||
Cabinets [Member] | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Assets | 2,355,700,000 | 2,318,700,000 | 2,355,700,000 | 2,318,700,000 | 2,416,300,000 | ||||||||
Depreciation expense | 44,300,000 | 50,900,000 | 42,800,000 | ||||||||||
Amortization of intangible assets | 17,800,000 | 19,600,000 | 19,700,000 | ||||||||||
Capital expenditures, gross | 30,900,000 | 73,800,000 | 63,400,000 | ||||||||||
Cabinets [Member] | Operating Segments [Member] | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Net sales | 2,388,500,000 | 2,418,600,000 | 2,467,100,000 | ||||||||||
Operating income | 178,300,000 | 143,500,000 | 267,200,000 | ||||||||||
Plumbing [Member] | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Assets | 2,110,800,000 | 1,943,100,000 | 2,110,800,000 | 1,943,100,000 | 1,854,100,000 | ||||||||
Depreciation expense | 32,000,000 | 29,100,000 | 26,900,000 | ||||||||||
Amortization of intangible assets | 10,300,000 | 10,400,000 | 7,700,000 | ||||||||||
Capital expenditures, gross | 35,700,000 | 41,400,000 | 43,500,000 | ||||||||||
Plumbing [Member] | Operating Segments [Member] | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Net sales | 2,027,200,000 | 1,883,300,000 | 1,720,800,000 | ||||||||||
Operating income | 427,600,000 | 375,300,000 | 358,500,000 | ||||||||||
Doors & Security [Member] | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Assets | $ 1,596,600,000 | $ 1,526,000,000 | 1,596,600,000 | 1,526,000,000 | 1,032,200,000 | ||||||||
Depreciation expense | 32,300,000 | 30,200,000 | 25,900,000 | ||||||||||
Amortization of intangible assets | 13,300,000 | 6,100,000 | 4,300,000 | ||||||||||
Capital expenditures, gross | 63,600,000 | 34,300,000 | 40,100,000 | ||||||||||
Doors & Security [Member] | Operating Segments [Member] | |||||||||||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||||||||||||
Net sales | 1,348,900,000 | 1,183,200,000 | 1,095,400,000 | ||||||||||
Operating income | $ 172,300,000 | $ 155,600,000 | $ 146,900,000 | ||||||||||
[1] | Capital expenditures of $10.0 million, $16.7 million and $17.2 million that have not been paid as of December 31, 2019, 2018 and 2017, respectively, were excluded from the Consolidated Statement of Cash Flows. | ||||||||||||
[2] | Based on country of destination | ||||||||||||
[3] | (a) Below is a table detailing Corporate expenses: General and administrative expense $ (79.7 ) $ (79.2 ) $ (85.0 ) Long-lived asset impairment — — (5.1 ) Total Corporate expenses $ (79.7 ) $ (79.2 ) $ (90.1 ) |
Information on Business Segme_4
Information on Business Segments - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Number of customers accounted for greater than 10% of net sales | 2 | 2 | 2 |
Customer Concentration Risk | Net Sales | The Home Depot, Inc. | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Percentage of net sales to major customer | 14.00% | 13.00% | 13.00% |
Customer Concentration Risk | Net Sales | Lowe's Companies, Inc | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Percentage of net sales to major customer | 14.00% | 14.00% | 14.00% |
Quarterly Financial Data - Sche
Quarterly Financial Data - Schedule of Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Data [Abstract] | |||||||||||
Net sales | $ 1,470.5 | $ 1,459 | $ 1,507.2 | $ 1,327.9 | $ 1,420.7 | $ 1,380.8 | $ 1,429 | $ 1,254.6 | $ 5,764.6 | $ 5,485.1 | $ 5,283.3 |
Gross profit | 531.8 | 524.2 | 537.6 | 458.8 | 501.8 | 493.9 | 524.1 | 439.6 | 2,052.4 | 1,959.4 | |
Operating income | 192.5 | 168 | 202.4 | 135.6 | 140.1 | 147.1 | 188.6 | 119.4 | 698.5 | 595.2 | 682.5 |
Income from continuing operations, net of tax | 104 | 105.7 | 137.1 | 84.5 | 85.3 | 99.9 | 129.7 | 75.1 | 431.3 | 390 | 475.3 |
Loss from discontinued operations, net of tax | (0.2) | (0.2) | (2.6) | ||||||||
Net income | 104 | 105.7 | 137.1 | 84.5 | 85.3 | 99.9 | 129.7 | 74.9 | 431.3 | 389.8 | $ 472.7 |
Net income attributable to Fortune Brands | $ 104.1 | $ 105.6 | $ 137.5 | $ 84.7 | $ 85.2 | $ 99.8 | $ 129.6 | $ 75 | $ 431.9 | $ 389.6 | |
Basic earnings (loss) per common share | |||||||||||
Continuing operations | $ 0.75 | $ 0.76 | $ 0.98 | $ 0.60 | $ 0.60 | $ 0.70 | $ 0.89 | $ 0.50 | $ 3.09 | $ 2.69 | $ 3.10 |
Discontinued operations | (0.02) | ||||||||||
Net income attributable to Fortune Brands | 0.75 | 0.76 | 0.98 | 0.60 | 0.60 | 0.70 | 0.89 | 0.50 | 3.09 | 2.69 | 3.08 |
DILUTED EARNINGS (LOSS) PER COMMON SHARE | |||||||||||
Continuing operations | 0.74 | 0.75 | 0.97 | 0.60 | 0.60 | 0.69 | 0.88 | 0.49 | 3.06 | 2.66 | 3.05 |
Discontinuing operations | (0.02) | ||||||||||
Net income attributable to Fortune Brands | $ 0.74 | $ 0.75 | $ 0.97 | $ 0.60 | $ 0.60 | $ 0.69 | $ 0.88 | $ 0.49 | $ 3.06 | $ 2.66 | $ 3.03 |
Quarterly Financial Data - Addi
Quarterly Financial Data - Additional Information (Detail) - Trade Names [Member] - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Quarterly Financial Information [Line Items] | ||||||
Pre-tax defined benefit plan actuarial gains (losses) | $ 32 | $ 2.1 | $ 3.5 | $ 0.3 | $ 34.1 | $ 3.8 |
After-tax defined benefit plan actuarial gains (losses) | $ 24.2 | $ 1.6 | $ 2.8 | $ 0.2 |
Earnings Per Share - Computatio
Earnings Per Share - Computations of Earnings (Loss) per Common Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Earnings Per Share [Abstract] | ||||||||||||
Income from continuing operations, net of tax | $ 104 | $ 105.7 | $ 137.1 | $ 84.5 | $ 85.3 | $ 99.9 | $ 129.7 | $ 75.1 | $ 431.3 | $ 390 | $ 475.3 | |
Less: Noncontrolling interests | (0.6) | 0.2 | 0.1 | |||||||||
Income from continuing operations for EPS | 431.9 | 389.8 | 475.2 | |||||||||
Income (loss) from discontinued operations | (0.2) | (2.6) | ||||||||||
NET INCOME ATTRIBUTABLE TO FORTUNE BRANDS | $ 431.9 | $ 389.6 | $ 472.6 | |||||||||
BASIC EARNINGS (LOSS) PER COMMON SHARE | ||||||||||||
Continuing operations | $ 0.75 | $ 0.76 | $ 0.98 | $ 0.60 | $ 0.60 | $ 0.70 | $ 0.89 | $ 0.50 | $ 3.09 | $ 2.69 | $ 3.10 | |
Discontinuing operations | (0.02) | |||||||||||
Net income attributable to Fortune Brands common shareholders | 0.75 | 0.76 | 0.98 | 0.60 | 0.60 | 0.70 | 0.89 | 0.50 | 3.09 | 2.69 | 3.08 | |
Diluted | ||||||||||||
Continuing operations | 0.74 | 0.75 | 0.97 | 0.60 | 0.60 | 0.69 | 0.88 | 0.49 | 3.06 | 2.66 | 3.05 | |
Discontinuing operations | (0.02) | |||||||||||
Net income attributable to Fortune Brands common shareholders | $ 0.74 | $ 0.75 | $ 0.97 | $ 0.60 | $ 0.60 | $ 0.69 | $ 0.88 | $ 0.49 | $ 3.06 | $ 2.66 | $ 3.03 | |
Basic average number of shares outstanding | [1] | 139.9 | 144.6 | 153.2 | ||||||||
Stock-based awards | 1.4 | 1.8 | 2.6 | |||||||||
Diluted average shares outstanding | [1] | 141.3 | 146.4 | 155.8 | ||||||||
Antidilutive stock-based awards excluded from weighted-average number of shares outstanding for diluted earnings per share | 1.8 | 1.5 | 0.5 | |||||||||
[1] | Reflects the impact of share repurchases during the years ended December 31, 2019, 2018 and 2017, respectively. |
Other Expense (Income), Net - C
Other Expense (Income), Net - Components of Other Expense (Income), Net (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Other Income And Expenses [Abstract] | |||
Defined benefit plan | $ 31.9 | $ (6.5) | $ (9.6) |
Asset impairment charge | 7 | ||
Foreign currency (gains)/losses | (0.7) | (2) | 0.9 |
Ineffective portion of cash flow hedge | (3.8) | ||
Other items, net | (2.2) | (4) | |
Total other expense (income), net | $ 29 | $ (16.3) | $ (1.7) |
Other Expense (Income), Net - A
Other Expense (Income), Net - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Other Income And Expenses [Abstract] | ||
Ineffective portion of cash flow hedges | $ 3.8 | |
Impairment charge | $ 7 |
Contingencies - Additional Info
Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Loss Contingency [Abstract] | ||
Accruals, relating to environmental compliance and clean up | $ 0.2 | $ 0.6 |
Schedule II Valuation and Qua_2
Schedule II Valuation and Qualifying Accounts (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Allowance for cash discounts, returns and sales allowances | ||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line items] | ||||
Balance at Beginning of Period | $ 84.6 | $ 84 | $ 68.2 | |
Charged to Expense | 198.6 | 216.1 | 205.7 | |
Reclassifications | [1] | (16) | 3 | |
Write-offs, and Deductions | [2] | 186.3 | 199.5 | 192.9 |
Balance at End of Period | 96.9 | 84.6 | 84 | |
Allowance for doubtful accounts | ||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line items] | ||||
Balance at Beginning of Period | 3.7 | 3.3 | 7.4 | |
Charged to Expense | 1.6 | 1.5 | 0.2 | |
Write-offs, and Deductions | [2] | 2.3 | 1.4 | 4.5 |
Business Acquisition | [3] | 0.3 | 0.2 | |
Balance at End of Period | 3 | 3.7 | 3.3 | |
Allowance for deferred tax assets | ||||
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line items] | ||||
Balance at Beginning of Period | 13.3 | 11 | 16.4 | |
Charged to Expense | 3.5 | 2.3 | (5.4) | |
Balance at End of Period | $ 16.8 | $ 13.3 | $ 11 | |
[1] | Represents reclassification of reserve for returns to a separate liability account due to our adoption of the revenue recognition standard and a reclassification of sales allowances to certain customer program liabilities across all segments during 2018. 2017 represents a reclassification of certain customer program liabilities to sales allowances (reduction to accounts receivable) in the Doors & Security segment. | |||
[2] | Net of recoveries of amounts written off in prior years and immaterial foreign currency impact. | |||
[3] | Represents purchase accounting adjustment related to the Fiberon acquisition within our Doors and Security segment in 2018. 2017 represents a valuation allowance on an acquired net operating loss carryforward (Norcraft Canada). |