Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Mar. 13, 2018 | Jul. 31, 2017 | |
Document And Entity Information | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jan. 31, 2018 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Entity Current Reporting Status | Yes | ||
Entity Registrant Name | KLX Inc. | ||
Entity Central Index Key | 1,617,898 | ||
Current Fiscal Year End Date | --01-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Common Stock, Shares Outstanding | 50,740,101 | ||
Entity Public Float | $ 2,614 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Jan. 31, 2018 | Jan. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 255.3 | $ 277.3 |
Accounts receivable–trade, less allowance for doubtful accounts ($12.0 at January 31, 2018 and $13.5 at January 31, 2017) | 316.1 | 261.3 |
Inventories, net | 1,407.9 | 1,381.4 |
Other current assets | 51.7 | 39.6 |
Total current assets | 2,031 | 1,959.6 |
Property and equipment, net of accumulated depreciation ($191.1 at January 31, 2018 and $149.4 at January 31, 2017) | 286.4 | 248.3 |
Goodwill | 1,056.8 | 996.4 |
Identifiable intangible assets, net | 308.6 | 314.8 |
Deferred income taxes | 74.5 | 147 |
Other assets | 32.7 | 32.2 |
Total assets | 3,790 | 3,698.3 |
Current liabilities: | ||
Accounts payable | 180.8 | 166 |
Accrued liabilities | 106.7 | 91.1 |
Total current liabilities | 287.5 | 257.1 |
Long-term debt | 1,184.6 | 1,182 |
Deferred income taxes | 5.9 | 5 |
Other non-current liabilities | 42.1 | 33.1 |
Commitments, contingencies and off-balance sheet arrangements (Note 8) | ||
Stockholders' equity: | ||
Preferred stock, $0.01 par value; 1.0 million shares authorized; no shares outstanding | ||
Common stock, $0.01 par value; 250.0 million shares authorized; 54.6 million shares issued as of January 31, 2018 and 53.5 million shares issued as of January 31, 2017 | 0.5 | 0.5 |
Additional paid-in capital | 2,756.5 | 2,686.5 |
Treasury stock: 3.8 million shares at January 31, 2018 and 1.5 million shares at January 31, 2017 | (182.7) | (54.4) |
Accumulated deficit | (280) | (328) |
Accumulated other comprehensive loss | (24.4) | (83.5) |
Total stockholders' equity | 2,269.9 | 2,221.1 |
Total liabilities and equity | $ 3,790 | $ 3,698.3 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jan. 31, 2018 | Jan. 31, 2017 |
Consolidated Balance Sheets | ||
Accounts receivable - trade, allowance for doubtful accounts | $ 12 | $ 13.5 |
Property and equipment, accumulated depreciation | $ 191.1 | $ 149.4 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding | 0 | |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 250,000,000 | 250,000,000 |
Common stock, shares issued | 54,600,000 | 53,500,000 |
Treasury stock | 3,800,000 | 1,500,000 |
Consolidated Statements of Earn
Consolidated Statements of Earnings and Comprehensive Income - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Consolidated Statements of Earnings and Comprehensive Income | |||
Product revenues | $ 1,420.2 | $ 1,340.9 | $ 1,312.5 |
Service revenues | 320.6 | 153.2 | 254.9 |
Total revenues | 1,740.8 | 1,494.1 | 1,567.4 |
Cost of sales - products | 994.7 | 942.2 | 918.1 |
Cost of sales - services | 269.1 | 183.9 | 284.3 |
Total cost of sales | 1,263.8 | 1,126.1 | 1,202.4 |
Selling, general and administrative | 260.7 | 238.6 | 261.6 |
Goodwill impairment charge | 0 | 0 | 310.4 |
Long-lived asset impairment charge | 329.8 | ||
Operating earnings (loss) | 216.3 | 129.4 | (536.8) |
Interest expense | 75.8 | 75.9 | 77.3 |
Earnings (loss) before income taxes | 140.5 | 53.5 | (614.1) |
Income tax expense (benefit) | 87.1 | 5.3 | (228.3) |
Net earnings (loss) | 53.4 | 48.2 | (385.8) |
Other comprehensive income (loss): | |||
Foreign currency translation adjustment | 59.1 | (9.3) | (18.7) |
Comprehensive income (loss) | $ 112.5 | $ 38.9 | $ (404.5) |
Net earnings (loss) per share - basic | $ 1.06 | $ 0.93 | $ (7.39) |
Net earnings (loss) per share - diluted | $ 1.04 | $ 0.92 | $ (7.39) |
Weighted average common shares - basic | 50.5 | 51.8 | 52.2 |
Weighted average common shares - diluted | 51.3 | 52.2 | 52.2 |
Consolidated and Combined State
Consolidated and Combined Statements Of Stockholders' Equity - USD ($) shares in Millions, $ in Millions | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings (Deficit) | Accumulated Other Comprehensive Income (Loss) | Total |
Balance at Jan. 31, 2015 | $ 0.5 | $ 2,644.8 | $ 11.3 | $ (55.5) | $ 2,601.1 | |
Balance (shares) at Jan. 31, 2015 | 52.8 | |||||
Sale of stock under employee stock purchase plan | 1.8 | 1.8 | ||||
Return to provision true-up related to pre spin-off and other | 1 | 1 | ||||
Purchase of treasury stock | $ (12.5) | (12.5) | ||||
Restricted stock grants, net of forfeitures and restricted stock unit vesting | 14.8 | 0.8 | 15.6 | |||
Restricted stock grants, net of forfeitures and restricted stock unit vesting (in shares) | 0.5 | |||||
Net earnings (loss) | (385.8) | (385.8) | ||||
Net foreign currency translation adjustments | (18.7) | (18.7) | ||||
Balance at Jan. 31, 2016 | $ 0.5 | 2,662.4 | (12.5) | (373.7) | (74.2) | 2,202.5 |
Balance (shares) at Jan. 31, 2016 | 53.3 | |||||
Sale of stock under employee stock purchase plan | 2 | 2 | ||||
Purchase of treasury stock | (41.9) | (41.9) | ||||
Restricted stock grants, net of forfeitures and restricted stock unit vesting | 22.1 | (2.5) | 19.6 | |||
Restricted stock grants, net of forfeitures and restricted stock unit vesting (in shares) | 0.2 | |||||
Net earnings (loss) | 48.2 | 48.2 | ||||
Net foreign currency translation adjustments | (9.3) | (9.3) | ||||
Balance at Jan. 31, 2017 | $ 0.5 | 2,686.5 | (54.4) | (328) | (83.5) | 2,221.1 |
Balance (shares) at Jan. 31, 2017 | 53.5 | |||||
Sale of stock under employee stock purchase plan | 2.3 | 2.3 | ||||
Purchase of treasury stock | (128.3) | (128.3) | ||||
Restricted stock grants, net of forfeitures and restricted stock unit vesting | 67.7 | (7) | 60.7 | |||
Restricted stock grants, net of forfeitures and restricted stock unit vesting (in shares) | 1.1 | |||||
Net earnings (loss) | 53.4 | 53.4 | ||||
Net foreign currency translation adjustments | 59.1 | 59.1 | ||||
Cumulative effect of adoption of new accounting principle (See Note 1) | 1.6 | 1.6 | ||||
Balance at Jan. 31, 2018 | $ 0.5 | $ 2,756.5 | $ (182.7) | $ (280) | $ (24.4) | $ 2,269.9 |
Balance (shares) at Jan. 31, 2018 | 54.6 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||
Net earnings (loss) | $ 53.4 | $ 48.2 | $ (385.8) |
Adjustments to reconcile net earnings (loss) to net cash flows provided by (used in) operating activities: | |||
Depreciation and amortization | 66.1 | 66.9 | 75 |
Deferred income taxes | 80.9 | 6.2 | (229.3) |
Asset impairment charge | 640.2 | ||
Non-cash compensation | 26.4 | 20.2 | 15.8 |
Amortization of deferred financing fees | 4.5 | 4.3 | 4 |
Tax impact from prior sales of restricted stock | 0.2 | ||
Provision for inventory reserve | 17.2 | 20.7 | 7.7 |
Change in allowance for doubtful accounts and sales returns | 0.2 | 3.2 | 3.3 |
Loss on disposal of property and equipment | 1.3 | 3.3 | 2.9 |
Changes in operating assets and liabilities, net of effects from acquisitions: | |||
Accounts receivable | (44.4) | 6.9 | 40.3 |
Inventories | (9.2) | (5) | 18 |
Other current and non-current assets | (19.5) | (4.6) | 2.7 |
Accounts payable | 9.9 | 11 | 3.4 |
Other current and non-current liabilities | 19.8 | (30.4) | 18.8 |
Net cash flows provided by operating activities | 206.6 | 150.9 | 217.2 |
CASH FLOWS FROM INVESTING ACTIVITIES: | |||
Capital expenditures | (84.9) | (35.5) | (130.5) |
Acquisitions, net of cash acquired | (64.8) | (220.8) | (4.3) |
Net cash flows used in investing activities | (149.7) | (256.3) | (134.8) |
CASH FLOWS FROM FINANCING ACTIVITIES: | |||
Purchase of treasury stock | (92.1) | (44.9) | (9.5) |
Cash proceeds from stock issuance | 2 | 1.5 | 1.5 |
Tax impact from prior sales of restricted stock | (0.2) | ||
Deferred acquisition payments | (90.9) | ||
Net cash flows used in financing activities | (90.1) | (43.4) | (99.1) |
Effect of foreign exchange rate changes on cash and cash equivalents | 11.2 | (1.7) | (2.7) |
Net decrease in cash and cash equivalents | (22) | (150.5) | (19.4) |
Cash and cash equivalents, beginning of period | 277.3 | 427.8 | 447.2 |
Cash and cash equivalents, end of period | 255.3 | 277.3 | 427.8 |
Cash paid during period for: | |||
Income taxes paid, net of refunds | 6.6 | 6.1 | 13.2 |
Interest | 73 | 72.1 | 71 |
Supplemental schedule of non-cash activities: | |||
Accrued property additions | $ 9.1 | $ 2.7 | 8.3 |
Treasury stock. | $ 3 |
Description of Business and Sum
Description of Business and Summary of Significant Accounting Policies | 12 Months Ended |
Jan. 31, 2018 | |
Description of Business and Summary of Significant Accounting Policies | |
Description of Business and Summary of Significant Accounting Policies | 1. DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Business We believe, based on our experience in the industry, that we are the world’s leading distributor and value‑added service provider of aerospace fasteners and other consumables, offering one of the broadest ranges of aerospace hardware and consumables and inventory management services, selling to essentially every major airline in the world as well as leading maintenance, repair and overhaul (“MRO”) providers, the leading airframe manufacturers and their first and second tier suppliers. The Company also provides technical services and associated rental equipment to land‑based oil and gas exploration and drilling companies often in remote locations. Basis of Presentation The Company’s consolidated financial statements include KLX and its wholly owned subsidiaries were prepared in accordance with accounting principles generally accepted in the United States (GAAP). All intercompany transactions and account balances within the Company have been eliminated. Use of Estimates —The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and related disclosures. Actual results could differ from those estimates. Revenue Recognition —Sales of products and services are recorded when the earnings process is complete. This generally occurs when the products are shipped to the customer in accordance with the contract or purchase order, risk of loss and title has passed to the customer, collectability is reasonably assured and pricing is fixed and determinable. In instances where title does not pass to the customer upon shipment, the Company recognizes revenue upon delivery or customer acceptance, depending on the terms of the sales contract. Management provides allowances for credits and returns, based on historic experience, and adjusts such allowances as considered necessary. In connection with the sales of its products, the Company also provides certain supply chain management services to certain of its customers. These services include the timely replenishment of products at the customer site, while also minimizing the customer’s on‑hand inventory. These services are provided by the Company contemporaneously with the delivery of the product, and as such, once the product is delivered, the Company does not have a post‑delivery obligation to provide services to the customer. The price of such services is generally included in the price of the products delivered to the customer, and revenue is recognized upon delivery of the product, at which point, the Company has satisfied its obligations to the customer. The Company does not account for these services as a separate element, as the services do not have stand‑alone value and cannot be separated from the product element of the arrangement. Service revenues from oilfield technical services and related rental equipment are recorded when services are performed and/or equipment is rented pursuant to a completed purchase order or master services agreement (“MSA”) that sets forth firm pricing and payment terms. Income Taxes —The Company provides deferred income taxes for temporary differences between the amounts of assets and liabilities recognized for financial reporting purposes and such amounts recognized for income tax purposes. Deferred income taxes are computed using enacted tax rates that are expected to be in effect when the temporary differences reverse. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion or the entire deferred tax asset will not be realized. The Company records uncertain tax positions within income tax expense and classifies interest and penalties related to income taxes as income tax expense. Cash Equivalents —The Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. Accounts Receivable, Net —The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and the customer’s current creditworthiness, as determined by review of their current credit information. The Company continuously monitors collections and payments from its customers and maintains a provision for estimated credit losses based upon historical experience and any specific customer collection issues that have been identified. The allowance for doubtful accounts at January 31, 2018 and 2017 was $12.0 and $13.5, respectively. Inventories —Inventories, made up of finished goods, primarily consist of aerospace fasteners and consumables. The Company values inventories at the lower of cost and net realizable value, using first‑in, first‑out or weighted average cost method. During the year ended January 31, 2017 (“Fiscal 2016”), the Company revised its methodology for estimating the provision required for excess and obsolete (“E&O”) inventories. The new methodology more adequately considers historical demand of our inventory to project future demand in order to estimate the provision required for E&O inventories. Other factors considered in the methodology include expected market growth rates and related elements. The implementation of the new methodology did not impact any prior period reserve for E&O inventory. Demand for the Company’s products can fluctuate from period to period depending on customer activity. In accordance with industry practice, costs in inventory include amounts relating to long-term contracts with long production cycles and to inventory items with long production cycles, some of which are not expected to be realized within one year. As a result, the Company’s operating cycle is greater than a year and is closely tied to the lifecycle of an airframe. Inventory reserves were approximately $72.4 and $59.6 as of January 31, 2018 and 2017, respectively. Substantially all of the Company’s inventory is comprised of aerospace grade fasteners which support OEM production and the aftermarket over the life of the airframe. Inventory with a limited shelf life is continually monitored and reserved for in advance of expiration. The reserve for inventory with limited shelf life is not material to the Company’s financial statements. Property and Equipment, Net —Property and equipment are stated at cost and depreciated generally under the straight‑line method over their estimated useful lives of one to thirty years (or the lesser of the term of the lease for leasehold improvements, as appropriate). Goodwill and Intangible Assets, Net —Under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 350, Intangibles — Goodwill and Other (“ASC 350”), goodwill and indefinite‑lived intangible assets are reviewed at least annually for impairment. Acquired intangible assets with definite lives are amortized over their individual useful lives. Other intangible assets are amortized using the straight‑line method over periods ranging from five to thirty years. As of January 31, 2018, the Company had two reporting units, which were determined based on the guidelines contained in FASB ASC Topic 350, Subtopic 20, Section 35. Each reporting unit constitutes a business, for which there is discrete financial information available that is regularly reviewed by the management of the Company. Goodwill is tested at least annually as of December 31 st , and management assesses whether there has been any impairment in the value of goodwill by comparing the fair value to the net carrying value of the reporting units. If the carrying value exceeds its estimated fair value, an impairment loss is recognized for the difference in accordance with the Company’s adoption of the new accounting principle discussed below. In this event, the asset is written down accordingly. The fair values of the reporting units for goodwill impairment testing is determined using valuation techniques based on estimates, judgments and assumptions management believes are appropriate in the circumstances. The indefinite‑lived intangible asset is tested at least annually for impairment. Impairment for the intangible asset with an indefinite life exists if the carrying value of the intangible asset exceeds its fair value. The fair value of the indefinite‑lived intangible asset is determined using valuation techniques based on estimates, judgments and assumptions management believes are appropriate in the circumstances. For the years ended January 31, 2018 and 2017, the Company’s annual impairment testing yielded no impairments of goodwill or the indefinite‑lived intangible asset. For the year ended January 31, 2016, the Company determined goodwill related to the Energy Services Group (“ESG”) reporting unit was fully impaired and recorded a pre-tax impairment charge related to ESG’s goodwill of $310.4. Long‑Lived Assets —The Company assesses potential impairments to its long‑lived assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered. An impairment loss is recognized when the undiscounted cash flows expected to be generated by an asset (or group of assets) is less than its carrying amount. Any required impairment loss is measured as the amount by which the asset’s carrying value exceeds its fair value and is recorded as a reduction in the carrying value of the related asset and a charge to operating results. For the years ended January 31, 2018 and 2017, there were no impairments of long lived assets. For the year ended January 31, 2016, the Company used a combination of cost and market approaches for determining the fair value of the ESG asset group’s long-lived assets and recognized impairment charges related to identified intangibles and property and equipment of $177.8 and $152.0, respectively. Common Stock Equivalents —The Company has potential common stock equivalents related to its outstanding restricted stock awards, restricted stock units and employee stock purchase plan. These potential common stock equivalents are not included in diluted loss per share for any period presented in which there is a net loss because the effect would have been anti‑dilutive. Accounting for Stock‑Based Compensation —The Company accounts for share‑based compensation arrangements in accordance with the provisions of FASB ASC 718, Compensation—Stock Compensation (“ASC 718”), whereby share‑based compensation cost is measured on the date of grant, based on the fair value of the award, and is recognized over the requisite service period. All unvested shares of restricted stock granted by B/E Aerospace, Inc. (our Former Parent) were converted into unvested shares of KLX on the distribution date at a ratio equal to 1.8139. Compensation cost recognized during the three years ended January 31, 2018 (“Fiscal 2017”) related to unvested shares converted on the distribution date and new shares of KLX restricted stock and stock options granted during the three years ended January 31, 2018. The Company has established a qualified Employee Stock Purchase Plan. The Employee Stock Purchase Plan allows qualified employees (as defined in the plan) to participate in the purchase of designated shares of KLX’s common stock at a price equal to 85% of the closing price for each semi‑annual stock purchase period. The fair value of employee purchase rights represents the difference between the closing price of KLX’s shares on the date of purchase and the purchase price of the shares. The value of the rights under this Plan granted during the years ended January 31, 2018, 2017 and 2016 was $0.4, $0.3 and $0.3, respectively. Foreign Currency Translation —The assets and liabilities of subsidiaries located outside the United States are translated into U.S. dollars at the rates of exchange in effect at the balance sheet dates. Revenue and expense items are translated at the average exchange rates prevailing during the period. Gains and losses resulting from foreign currency transactions are recognized currently in income, and those resulting from translation of financial statements are accumulated as a separate component of equity and accumulated other comprehensive income (loss). The Company’s European subsidiaries primarily utilize the British pound or the Euro as their local functional currency. Treasury Stock - The Company may periodically repurchase shares of its common stock from employees for the satisfaction of their individual payroll tax withholding upon vesting of restricted stock and restricted stock units in connection with the Company’s Long-Term Incentive Plan (“LTIP”). The Company’s repurchases of common stock are recorded at the average cost of the common stock. As part of the LTIP, the Company repurchased 713,210 and 35,009 shares of its common stock for $48.9 and $1.5 during the years ended January 31, 2018 and 2017. In January 2016, the Board of Directors authorized a $100.0 share repurchase under the existing $250.0 share repurchase program. In March 2017, the Board of Directors authorized an increase in the Company’s share repurchase authority from $100.0 to $200.0. During Fiscal 2017, the Company repurchased 1,652,661 shares of common stock at an average price of $48.04 per share for a total of $79.4 as part of the share repurchase program. During Fiscal 2016, the Company repurchased 982,062 shares of common stock at an average price of $41.20 per share for a total of $40.5 as part of the share repurchase program. Concentration of Risk —In Aerospace Solutions Group (“ASG”), the Company’s products and services are primarily concentrated within the aerospace industry with customers consisting primarily of commercial airlines, a wide variety of business jet customers and commercial aircraft manufacturers and their suppliers. In ESG, the Company provides products and services to energy industry customers who focus on developing and producing oil and gas onshore in North America. The Company’s management performs ongoing credit evaluations on the financial condition of all of its customers and maintains allowances for uncollectible accounts receivable based on expected collectability. Credit losses have historically been within management’s expectations and the provisions established. Significant customers change from year to year, in the case of ASG, depending on the level of refurbishment activity and/or the level of new aircraft purchases by such customers, and in the case of ESG, depending on the level of exploration and production activity and the use of our services. During the years ended January 31, 2018, 2017 and 2016, no single customer accounted for more than 10% of the Company’s consolidated revenues. Recent Accounting Pronouncements In May 2017, the FASB issued Accounting Standards Update (“ASU”) 2017-09, Compensation–Stock Compensation (Topic 718). This ASU was issued to provide clarity and reduce diversity in practice regarding the application of guidance on the modification of equity awards. The ASU states that an entity should account for the effects of a modification unless all of the following are met: the fair value, vesting conditions and the classification of the instrument as equity or liability of the modified award is the same as that of the original award immediately before such award is modified. The guidance is effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual reporting periods with early adoption permitted and should be applied prospectively to an award modified on or after the adoption date. The Company does not expect a material impact upon adoption of this ASU to its consolidated financial statements as the Company historically has accounted for all modifications in accordance with Topic 718 and has not been subject to the exception described under this ASU. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other. ASU 2017-04 simplifies the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendment should be applied on a prospective basis. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted, and the Company adopted the new standard during the fourth quarter of 2017. The adoption of ASU 2017-04 did not have an impact on the Company’s consolidated financial statements; however, the Company will no longer perform the second step of the goodwill impairment test where applicable in future impairment tests. In January 2017, the FASB issued ASU 2017-01, Business Combinations. This update clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The adoption of ASU 2017-01 is not expected to have a material impact on the Company’s consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, which eliminates a current exception in U.S. GAAP to the recognition of the income tax effects of temporary differences that result from intra-entity transfers of non-inventory assets. The intra-entity exception is being eliminated under the ASU. The standard is required to be applied on a modified retrospective basis and will be effective beginning with the first quarter of 2018. Early adoption is permitted, and the Company adopted the new standard during the first quarter of 2017, which resulted in the elimination of a $7.7 long-term prepaid tax balance and the recognition of a $8.8 longterm deferred tax asset with the offset recorded to the accumulated deficit. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”) related to how certain cash receipts and payments are presented and classified in the statement of cash flows. These cash flow issues include debt prepayment or extinguishment costs, settlement of zero-coupon debt, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, distributions received from equity method investees, beneficial interests in securitization transactions, and separately identifiable cash flows. This ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years with early adoption permitted and should be applied retrospectively. The Company does not expect a material impact upon adoption of this ASU to its consolidated financial statements as the Company’s consolidated statements of cash flows are not impacted by the eight issues listed above, with the exception of the contingent consideration payments, which will not be presented in the year of adoption. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation – Stock Compensation. The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments, including that excess tax benefits and shortfalls be recorded as income tax benefit or expense in the income statement, rather than equity, and requires excess tax benefits from stock-based compensation to be classified in cash flow from operations. The Company adopted the new standard during the first quarter of 2017 in compliance with the effective date, which resulted in the recognition of a $0.5 long-term deferred tax asset with the offset recorded to accumulated deficit. Prior year periods have been adjusted to conform to the current year presentation. With respect to forfeitures, the Company will continue to estimate the number of awards expected to be forfeited upon award issuance. In February 2016, the FASB issued ASU 2016-02, Leases , which supersedes ASC Topic 840, Leases , and creates a new topic, ASC Topic 842, Leases . This update is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Earlier adoption is permitted. ASU 2016-02 requires lessees to recognize a lease liability and a lease asset for all leases, including operating leases, with a term greater than 12 months on its balance sheet. The update also expands the required quantitative and qualitative disclosures surrounding leases. ASU 2016-02 will be applied using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the effect of this update on its consolidated financial statements. In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers, which updated the guidance in ASC Topic 606, Revenue Recognition. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should identify the contract(s) with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract and recognize revenue when (or as) the entity satisfies a performance obligation. In August 2015, the FASB deferred the effective date for implementation of ASU 2014-09 by one year and during 2016, the FASB issued various related accounting standard updates, which clarified revenue accounting principles and provided supplemental adoption guidance. The guidance under ASU 2014-09 is effective for fiscal years beginning after December 15, 2017, including interim reporting periods within that year. To assess the impact of this guidance, the Company established a cross functional implementation project team, inventoried its revenue streams and contracts with customers at its two segments and applied the principles of the guidance against a selection of contracts to assist in the determination of potential revenue accounting differences. No individually significant implementation matters were identified, and our revenue will be recognized on a “point-in-time” basis for product revenues and over time for service revenues under the new standard, which is consistent with current practice. The Company implemented internal controls, policies and processes to comply with the new standard. The Company adopted ASC Topic 606 in the first quarter of 2018 using the modified retrospective method of adoption, which resulted in no changes to the opening consolidated balance sheet as of February 1, 2018. Prior period consolidated statements of earnings and comprehensive income will remain unchanged. |
Business Combinations
Business Combinations | 12 Months Ended |
Jan. 31, 2018 | |
Business Combinations | |
Business Combinations | 2. BUSINESS COMBINATIONS On May 17, 2016, the Company acquired Herndon Aerospace & Defense LLC (“Herndon”), an aftermarket aerospace supply chain management and consumables hardware distributor servicing principally aftermarket military depots as well as the commercial aerospace aftermarket for an aggregate purchase price of $220.8 (net of cash acquired). The excess of the purchase price over the fair value of the net identifiable assets acquired approximated $119.6, of which $68.9 was allocated to identifiable intangible assets consisting of customer contracts and relationships and covenants not to compete and $50.7 is included in goodwill. The primary items that generated the goodwill recognized were the premium paid by the Company for future earnings potential and the value of the assembled workforce that does not qualify for separate recognition. The useful life assigned to the customer contracts and relationships is 20 years, and the covenants not to compete are being amortized over their contractual periods of five years. The Herndon acquisition was accounted for as a purchase under FASB ASC 805, Business Combinations (“ASC 805”). The assets purchased and liabilities assumed have been reflected in the accompanying consolidated balance sheets as of January 31, 2018 and 2017. The results of operations for the Herndon acquisition are included in the accompanying consolidated and combined statements of earnings from the date of acquisition. The following table summarizes the fair values of assets acquired and liabilities assumed in the Herndon acquisition in accordance with ASC 805: Accounts receivable-trade $ 12.3 Inventories 103.8 Other current and non-current assets 3.7 Property and equipment 2.1 Goodwill 50.7 Identified intangibles 68.9 Accounts payable (9.7) Other current and non-current liabilities (11.0) Total consideration paid $ 220.8 The majority of goodwill and intangible assets are expected to be deductible for tax purposes. The Company has substantially integrated Herndon into its ASG segment systems. As a result, it is not practicable to report stand-alone revenues and operating earnings of the acquired business since the acquisition date. On a pro forma basis to give effect to the Herndon acquisition, as if it occurred on February 1, 2015, revenues and net earnings for the years ended January 31, 2017 and 2016 would have been as follows: UNAUDITED YEAR ENDED January 31, 2017 January 31, 2016 Pro forma Pro forma Revenues $ 1,544.3 $ 1,699.8 Net earnings (loss) 51.7 (376.7) Earnings (loss) per diluted share 0.99 (7.21) The Company acquired two new product lines immediately prior to the end of the fourth quarter of Fiscal 2017. The first purchase includes high performance fasteners and precision components and assemblies dedicated to aircraft engine manufacturing. The second group of products will enable us to offer our customers technical products, systems, and expertise in motion and control applications, including hydraulics, pneumatics, fluid connectors, filtration, electrical control systems, seals, compressors and engineered systems for both OEM and aftermarket applications. The Company acquired the two product lines for an aggregate purchase price of $64.8, which were accounted for as purchases under ASC 805 and primarily consisting of inventory, accounts receivable, goodwill and intangibles and accounts payable and other current liabilities. The acquisitions did not have a material impact on the accompanying consolidated financial statements. The valuation of the acquired assets related to the product line acquisitions arenot yet complete, and as such, the Company has not yet finalized its allocation of the purchase price for the acquisitions. |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Jan. 31, 2018 | |
Property and Equipment, Net | |
Property and Equipment, Net | 3. PROPERTY AND EQUIPMENT, NET Property and equipment consist of the following: Useful January 31, January 31, Life (Years) 2018 2017 Land, buildings and improvements 1 - 30 $ 48.7 $ 40.9 Machinery 2 - 20 142.1 119.8 Computer equipment and software 1 - 15 123.7 105.5 Furniture and equipment 3 - 20 163.0 131.5 477.5 397.7 Less accumulated depreciation 191.1 149.4 $ 286.4 $ 248.3 Depreciation expense was $46.8, $47.3 and $51.3 for the years ended January 31, 2018, 2017 and 2016, respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Jan. 31, 2018 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | 4. GOODWILL AND LONG-LIVED ASSETS, NET The following sets forth the intangible assets by major asset class, all of which were acquired through business purchase transactions: January 31, 2018 January 31, 2017 Useful Life Original Accumulated Net Book Original Accumulated Net Book (Years) Cost Amortization Value Cost Amortization Value Customer contracts and relationships - 30 $ 413.6 $ 128.8 $ 284.8 $ 422.0 $ 129.1 $ 292.9 Covenants not to compete 5 2.2 0.7 1.5 5.5 3.6 1.9 Developed technologies 15 3.3 0.5 2.8 3.3 0.2 3.1 Trade names Indefinite 19.5 - 19.5 16.9 - 16.9 $ 438.6 $ 130.0 $ 308.6 $ 447.7 $ 132.9 $ 314.8 Amortization expense of intangible assets was $19.3, $19.6 and $23.7 for the years ended January 31, 2018, 2017 and 2016, respectively. Amortization expense related to intangible assets is expected to be approximately $19.0 in each of the next five years. In accordance with ASC 350, goodwill is not amortized but is subject to an annual impairment test. For the years ended January 31, 2018 and 2017, the Company’s annual impairment testing yielded no impairments of goodwill or the indefinite lived intangible asset. During the year ended January 31, 2016, the continued downturn in the oil and gas industry, including the nearly 75% decrease in the number of onshore drilling rigs and the resulting significant cutbacks in the capital expenditures of our customers, represented a significant adverse change in the business climate, which indicated that the ESG reporting unit’s goodwill was impaired and ESG asset group’s long-lived assets may not be recoverable. As a result, during the third quarter ended October 31, 2015, the Company performed an interim goodwill impairment test and a long-lived asset recoverability test. The results of the goodwill impairment testing indicated that goodwill was impaired which resulted in a $310.4 pre-tax goodwill impairment charge for the year ended January 31, 2016. Long-lived assets, such as property and equipment and purchased intangibles subject to amortization, are tested for impairment when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered. An impairment loss is recognized when the undiscounted cash flows expected to be generated by an asset (or group of assets) is less than its carrying amount. Any required impairment loss is measured as the amount by which the asset’s carrying value exceeds its fair value and is recorded as a reduction in the carrying value of the related asset and a charge to operating results. For the years ended January 31, 2018 and 2017, there were no impairments of long-lived assets. For the year ended January 31, 2016, the Company performed a long-lived asset impairment analysis and concluded the carrying amount of the long-lived assets exceeded the undiscounted cash flows of the ESG asset group. As a result, we recorded a $329.8 long-lived asset impairment charge, $177.8 related to identified intangible assets and $152.0 related to property and equipment for the year ended January 31, 2016. The goodwill and long-lived asset impairment charges reflected the full value of the goodwill and identified intangible assets attributable to the ESG segment. The accumulated goodwill impairment losses (incurred in 2008 and 2015) totaled $601.1 as of January 31, 2016. The changes in the carrying amount of goodwill for the years ended January 31, 2018, 2017 and 2016 are as follows: Balance, January 31, 2016 $ 954.9 Acquisitions 50.8 Purchase Price Adjustments (2.5) Effect of foreign currency translation (6.8) Balance, January 31, 2017 996.4 Acquisitions 17.3 Purchase Price Adjustments (0.1) Effect of foreign currency translation 43.2 Balance, January 31, 2018 $ 1,056.8 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jan. 31, 2018 | |
Related Party Transactions | |
Related Party Transactions | 5. RELATED PARTY TRANSACTIONS On December 17, 2014, Former Parent created an independent public company through a spin ‑ off of its ASG and ESG businesses to Former Parent’s stockholders (“Spin ‑ Off”). In connection with the Spin‑off, we have created some of the functions that were previously provided to us through corporate allocations from B/E Aerospace in‑house. We also entered into certain agreements with B/E Aerospace relating to transition services and IT services through April 2017. In addition, we entered into an employee matters agreement and a tax sharing and indemnification agreement with B/E Aerospace in connection with the Spin‑off. Expenses incurred under those agreements were not material for the year ended January 31, 2018 and totaled $8.7 for the year ended January 31, 2017. On April 13, 2017, B/E Aerospace was acquired by Rockwell Collins, Inc. and is no longer a related party. Sales to B/E Aerospace were $4.4 through April 12, 2017 and $24.1 and $19.0 for the years ended January 31, 2017 and 2016. |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Jan. 31, 2018 | |
Accrued Liabilities | |
Accrued Liabilities | 6. ACCRUED LIABILITIES Accrued liabilities consist of the following: January 31, 2018 January 31, 2017 Accrued salaries, vacation and related benefits $ 37.2 $ 31.6 Accrued commissions 10.9 8.7 Income taxes payable 10.7 10.3 Accrued interest 11.7 11.7 Other accrued liabilities 36.2 28.8 $ 106.7 $ 91.1 |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Jan. 31, 2018 | |
Long-Term Debt | |
Long-Term Debt | 7. LONG‑TERM DEBT Long-term debt consists of the following: January 31, 2018 January 31, 2017 Senior unsecured notes $ 1,200.0 $ 1,200.0 Less unamortized original issue discount and debt issue costs 15.4 18.0 $ 1,184.6 $ 1,182.0 In December 2014, in connection with the Spin‑off, the Company issued $1,200.0 aggregate principal amount of 5.875% senior unsecured notes due 2022 (the “5.875% Notes”), in an offering pursuant to the Securities Act of 1933, as amended. The net proceeds from the issuance of the 5.875% Notes were approximately $1,172.1, of which $750.0 was distributed to Former Parent, leaving KLX with net proceeds of approximately $422.1. The 5.875% Notes are senior unsecured debt obligations of the Company. We also entered into a $500.0 secured revolving credit facility dated as of December 16, 2014, which was amended and restated to a $750.0 secured revolving credit facility as of May 19, 2015 (the “Revolving Credit Facility”). As of January 31, 2018 and 2017, long‑term debt consisted of $1,200.0 of our 5.875% Notes. Letters of credit outstanding under the Revolving Credit Facility aggregated $5.8 at January 31, 2018. The Revolving Credit Facility is tied to a borrowing base formula, has no financial covenants and has $744.2 of availability as of January 31, 2018. The Revolving Credit Facility bears interest at an annual rate equal to the London interbank offered rate (“LIBOR”) plus the applicable margin (as defined), and expires in May 2020. No amounts were outstanding under the Revolving Credit Facility as of January 31, 2018 or 2017. Maturities of long‑term debt are as follows: Year Ending January 31, 2019 $ — 2020 — 2021 — 2022 — 2023 1,200.0 Thereafter — Total $ 1,200.0 Interest expense amounted to $75.8, $75.9 and $77.7 for the years ended January 31, 2018, 2017 and 2016, respectively. |
Commitments, Contingencies and
Commitments, Contingencies and Off-Balance Sheet Arrangements | 12 Months Ended |
Jan. 31, 2018 | |
Commitments, Contingencies and Off-Balance Sheet Arrangements | |
Commitments, Contingencies and Off-Balance Sheet Arrangements | 8. COMMITMENTS, CONTINGENCIES AND OFF‑BALANCE‑SHEET ARRANGEMENTS Lease Commitments —The Company finances its use of certain facilities and equipment under committed lease arrangements provided by various institutions. Since the terms of these arrangements meet the accounting definition of operating lease arrangements, the aggregate sum of future minimum lease payments is not reflected on the consolidated and combined balance sheets. At January 31, 2018, future minimum lease payments under these arrangements approximated $190.1, of which $166.0 is related to long‑term real estate leases. Rent expense for the years ended January 31, 2018, 2017 and 2016 was $39.8, $28.9 and $37.7, respectively. Future payments under operating leases with terms greater than one year as of January 31, 2018 are as follows: Year Ending January 31, 2019 $ 31.2 2020 30.1 2021 24.7 2022 20.6 2023 15.0 Thereafter 68.5 Total $ 190.1 Litigation —The Company is a defendant in various legal actions arising in the normal course of business, the outcomes of which, in the opinion of management, neither individually nor in the aggregate are likely to result in a material adverse effect on the Company’s consolidated and combined financial statements. Indemnities, Commitments and Guarantees —During its normal course of business, the Company has made certain indemnities, commitments and guarantees under which it may be required to make payments in relation to certain transactions. These indemnities include indemnities to various lessors in connection with facility leases for certain claims arising from such facility or lease and indemnities to other parties to certain acquisition agreements. The duration of these indemnities, commitments and guarantees varies, and in certain cases, is indefinite. Many of these indemnities, commitments and guarantees provide for limitations on the maximum potential future payments the Company could be obligated to make. However, the Company is unable to estimate the maximum amount of liability related to its indemnities, commitments and guarantees because such liabilities are contingent upon the occurrence of events that are not reasonably determinable. Management believes that any liability for these indemnities, commitments and guarantees would not be material to the accompanying consolidated and combined financial statements. Accordingly, no significant amounts have been accrued for indemnities, commitments and guarantees. The Company has employment and compensation agreements with key officers of the Company. An agreement with one of the officers provides for the officer to earn a minimum of $1.0 per year, subject to increases as determined from time to time by the Company's Board of Directors or the Compensation Committee of the Board of Directors, for a three-year period from the effective date (as defined in such agreement), with automatic extension by one year on each anniversary of the effective date of the agreement unless either party provides notice of non-renewal, as well as quarterly contributions to a tax-deferred compensation plan which in the aggregate, on an annual basis, would amount to a contribution equal to 100% of such officer's base salary in effect at the time, to be reduced to 30% effective for fiscal quarters commencing on or after February 1, 2017. One other agreement provides for an officer to receive annual minimum compensation of $0.7 per year, which may be increased in the discretion of the Company’s Board of Directors or the Compensation Committee of the Board of Directors, for a three-year period from the effective date (as defined in such agreement) with automatic extension by one year on each anniversary of the effective date of the agreement unless either party provides notice of non-renewal, and to receive quarterly contributions to a tax-deferred compensation plan which in the aggregate, on an annual basis, would amount to a contribution equal to 100% of such officer’s base salary in effect at the time. In addition, the Company has employment agreements with certain other key members of management expiring on various dates. The Company's employment agreements generally provide for certain protections in the event of a change of control. These protections generally include the payment of severance and related benefits under certain circumstances in the event of a change of control. |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 31, 2018 | |
Income Taxes | |
Income Taxes | 9. INCOME TAXES The Company determined the provision for income taxes using the asset and liability approach. Under this approach, deferred income taxes represent the expected future tax consequences of temporary differences between the carrying amounts and tax basis of assets and liabilities. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. In assessing the need for a valuation allowance, the Company looked to the future reversal of existing taxable temporary differences, taxable income in carryback years and the feasibility of tax planning strategies and estimated future taxable income. The need for a valuation allowance can be affected by changes to tax laws, changes to statutory tax rates and changes to future taxable income estimates. The Company recognizes tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such positions are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. As of January 31, 2018, the Company has recorded a tax indemnity payable to B/E Aerospace totaling $6.4, of which $1.8 is classified in other current liabilities and $4.6 is classified in other long‑term liabilities. Components of earnings (loss) before incomes taxes were: Year Ended January 31, 2018 2017 2016 Earnings (loss) before income taxes United States $ 128.3 $ 41.3 $ (624.4) Foreign 12.2 12.2 10.3 Earnings (loss) before income taxes $ 140.5 $ 53.5 $ (614.1) Income tax expense (benefit) consists of the following: Year Ended January 31, 2018 2017 2016 Current: Federal $ (0.2) $ — $ 0.7 State 0.8 0.3 (1.5) Foreign 5.1 (1.3) 3.8 5.7 (1.0) 3.0 Deferred: Federal 79.8 14.4 (213.3) State 2.9 1.3 (17.4) Foreign (1.3) (9.4) (0.6) 81.4 6.3 (231.3) Total income tax expense (benefit) $ 87.1 $ 5.3 $ (228.3) The difference between income tax expense (benefit) and the amount computed by applying the statutory U.S. federal income tax rate (33.8% for the year ended January 31, 2018 and 35% for the years ended January 31, 2017 and 2016) to the pre‑tax earnings consists of the following: Year Ended January 31, 2018 2017 2016 Statutory federal income tax expense (benefit) $ 47.5 $ 18.7 $ (214.9) U.S. state income taxes 3.4 1.5 (17.5) Foreign tax rate differential (0.1) 0.1 (0.2) Change in unrecognized tax benefits 0.2 (7.8) 0.4 Change in valuation allowance on foreign 6.3 (1.6) 5.3 Other, net 0.7 1.3 2.0 Non-taxable/non-deductible items (6.0) (6.9) (3.4) Stock compensation (7.2) — — Change in tax rate 42.3 — — $ 87.1 $ 5.3 $ (228.3) The tax effects of temporary differences and carryforwards that give rise to deferred income tax assets and liabilities consist of the following: January 31, 2018 January 31, 2017 Deferred tax assets: Inventory reserves $ 19.8 $ 24.8 Accrued liabilities 9.8 12.9 Intangible Assets 13.4 44.2 Net operating loss carryforward 70.3 81.2 Inventory capitalization 9.3 14.9 Other 14.8 19.9 137.4 197.9 Deferred tax liabilities: Intangible assets (13.7) (12.8) Depreciation (30.3) (25.3) (44.0) (38.1) Net deferred tax asset before valuation allowance 93.4 159.8 Valuation allowance (24.8) (17.8) Net deferred tax asset $ 68.6 $ 142.0 A reconciliation of the beginning and ending amounts of gross uncertain tax positions is presented below: January 31, 2018 January 31, 2017 January 31, 2016 Unrecognized tax benefit at beginning of period $ 7.2 $ 9.0 $ 9.4 Additions for current year tax positions 0.1 4.6 — Additions for prior year tax positions — 1.3 — Decreases for prior year tax positions — (7.6) — Foreign currency fluctuations 1.1 (0.1) (0.4) Unrecognized tax benefit at end of period $ 8.4 $ 7.2 $ 9.0 Included in the balance of unrecognized tax benefits as of January 31, 2018, 2017 and 2016 are $5.6, $4.4 and $9.0, respectively, of tax benefits that, if recognized, would affect the effective tax rate. The Company does not anticipate that the total unrecognized tax benefits will significantly change due to the settlement of audits or the expiration of statutes of limitation within twelve months of this reporting date. The Company classifies interest and penalties related to income tax as income tax expense. The amount included in the Company’s liability for unrecognized tax benefits for interest and penalties was immaterial as of January 31, 2018, 2017 and 2016. The Company is subject to taxation in the United States, various states and foreign jurisdictions. The Company has significant operations in the United States, the United Kingdom, France and Germany. Tax years that remain subject to examinations by major tax jurisdictions vary by legal entity but are generally open for the U.S. for tax years ending in 2014 and after and outside the U.S. for the tax years ending after 2007. As of January 31, 2018, the Company has federal net operating loss carryforwards of $157.4 expiring beginning in 2035 and state net operating loss carryforwards of $134.6 expiring between 2020 and 2035 with the majority expiring in 2035. The Company has $117.8 of foreign net operating loss carryforwards as of January 31, 2018 for which a valuation allowance of $95.2 has been recognized. All of the Company’s foreign net operating losses have an indefinite carryforward period. The Company’s future tax provision will reflect any favorable or unfavorable adjustments to its estimated tax liabilities when resolved. The Company is unable to predict the outcome of these matters. However, the Company believes that none of these matters will have a material effect on the results of operations or financial condition of the Company. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation – Stock Compensation. The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments, including that excess tax benefits and shortfalls be recorded as income tax benefit or expense in the statement of earnings, rather than equity, and requires excess tax benefits from stock-based compensation to be classified in cash flow from operations. The Company adopted the new standard during the first quarter of 2017 in compliance with the effective date, which resulted in the recognition of a $0.5 long-term deferred tax asset with the offset recorded to accumulated deficit. Prior periods have been adjusted to conform to the current year presentation. With respect to forfeitures, the Company will continue to estimate the number of awards expected to be forfeited upon award issuance. Undistributed earnings of certain of the Company’s foreign subsidiaries amounted to $101.0 at January 31, 2018. Those earnings are considered to be permanently reinvested, and no provision for U.S. federal and state income taxes has been made. Distribution of these earnings in the form of dividends or otherwise could result in U.S. federal taxes (subject to an adjustment for foreign tax credits) and withholding taxes payable in various foreign countries. It is not currently practical to determine the amount of U.S. income and foreign withholding tax payable in the event all such foreign earnings are repatriated. The Company’s effective tax rate can fluctuate as operations and the local country tax rates fluctuate due to the number of tax jurisdictions in which the Company operates. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, which eliminates a current exception in U.S. GAAP to the recognition of the income tax effects of temporary differences that result from intra-entity transfers of non-inventory assets. The intra-entity exception is being eliminated under the ASU. The standard is required to be applied on a modified retrospective basis and will be effective beginning with the first quarter of 2018. Early adoption is permitted, and the Company adopted the new standard during the first quarter of 2017, which resulted in the elimination of a $7.7 long-term prepaid tax balance and the recognition of a $8.8 long term deferred tax asset with the offset recorded to the accumulated deficit. The Securities and Exchange Commission (SEC) staff issued Staff Accounting Bulletin No. 118 (SAB 118), which provides guidance on accounting for the tax effects of the Tax Cut and Jobs Act of 2017 (the “2017 Tax Act”). SAB 118 provides a measurement period that should not extend beyond one year from the 2017 Tax Act enactment date for companies to complete the accounting relating to the 2017 Tax Act under the Income Taxes Topic of the FASB ASC. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the 2017 Tax Act for which the accounting under the Income Taxes Topic of the FASB ASC is complete. To the extent that a company's accounting for certain income tax effects of the 2017 Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in its financial statements. If a company cannot determine a provisional estimate to be included in its financial statements, it should continue to apply the Income Taxes Topic of the FASB ASC on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the 2017 Tax Act. The ultimate impact of the 2017 Tax Act in the Company's financial statements is provisional with regard to certain foreign tax provisions and may differ from its estimates due to changes in the interpretations and assumptions made by the Company as well as additional regulatory guidance that may be issued. On December 22, 2017, President Trump signed into law the legislation generally known as the Tax Cut and Jobs Act of 2017. The tax law includes significant changes to the U.S. corporate tax systems including a rate reduction from 35% to 21% beginning in January of 2018, a change in the treatment of foreign earnings going forward and a deemed repatriation transition tax. In accordance with ASC 740, “Income Taxes”, the impact of a change in tax law is recorded in the period of enactment. During the fourth quarter of 2017, the Company recorded a material, non-cash, change in its net deferred income tax balances of approximately $43.3 related to the federal and state tax rate changes. The Company estimates that its deemed repatriation liability will not be material. Under the tax sharing and indemnity agreement between the Company and B/E Aerospace, B/E Aerospace generally assumes liability for all federal and state income taxes for all tax periods ending on or prior to December 31, 2014. B/E Aerospace assumes the liability for all federal and state income taxes of KLX’s U.S. operations through the distribution date. KLX assumes all other federal taxes, foreign income tax/non‑income taxes and state/local non‑income taxes related to its business for all periods and B/E Aerospace assumes all other federal taxes, foreign income tax/non‑income taxes and state/local non‑income taxes related to their business for all periods. Additional taxes incurred related to the internal restructuring to separate the businesses to complete the spin‑off shall be shared equally between B/E Aerospace and KLX. Taxes incurred related to certain international tax initiatives for the KLX business shall be assumed by KLX subject to the calculation provisions of the tax sharing and indemnity agreement. In addition, B/E Aerospace transferred to KLX all the deferred tax assets and liabilities related to the KLX business as of December 16, 2014. |
Employee Retirement Plans
Employee Retirement Plans | 12 Months Ended |
Jan. 31, 2018 | |
Employee Retirement Plans | |
Employee Retirement Plans | 10. EMPLOYEE RETIREMENT PLANS The Company sponsors and contributes to a qualified, defined contribution savings and investment plan, covering substantially all U.S. employees. The KLX Inc. Retirement Plan was established pursuant to Section 401(k) of the Internal Revenue Code. Under the terms of this plan, covered employees may contribute up to 100% of their pay, limited to certain statutory maximum contributions. Participants are vested in matching contributions immediately and the matching percentage is 100% of the first 3% of employee contributions and 50% on the next 2% of employee contributions. For all periods prior to the year ended January 31, 2017, KLX employees participated in a plan sponsored by our Former Parent. Total expense for the plan was $4.3, $3.4 and $3.6 for the years ended January 31, 2018, 2017 and 2016, respectively. The Company also sponsors and contributes to a supplemental executive retirement plan (“SERP”), which was established pursuant to Section 409A of the Internal Revenue Code, for certain employees. The SERP is an unfunded plan maintained for the purpose of providing deferred compensation for certain employees. This plan allows certain employees to annually elect to defer a portion of their compensation, on a pre‑tax basis, until their retirement. The retirement benefit to be provided is based on the amount of compensation deferred. Compensation expense under this program was $2.3, $2.5 and $2.4 for the years ended January 31, 2018, 2017 and 2016, respectively. The Company and its subsidiaries participate in government‑sponsored programs in certain foreign countries. The Company funds these plans based on legal requirements, tax considerations, local practices and investment opportunities. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Jan. 31, 2018 | |
Stockholders' Equity | |
Stockholders' Equity | 11. STOCKHOLDERS’ EQUITY Earnings Per Share —Basic net earnings per common share is computed using the weighted average of common shares outstanding during the year. Diluted net earnings per common share reflects the potential dilution from assumed conversion of all dilutive securities such as stock options and unvested restricted stock using the treasury stock method. When the effects of the outstanding stock options, restricted stock awards or restricted stock units are anti‑dilutive, they are not included in the calculation of diluted earnings per common share. For the years ended January 31, 2018, 2017 and 2016 no shares were excluded from the determination of diluted earnings per common share. The following table sets forth the computation of basic and diluted net earnings per share for the years ended January 31, 2018, 2017 and 2016: Year Ended January 31, 2018 2017 2016 Numerator: net earnings (loss) $ 53.4 $ 48.2 $ (385.8) Denominator: Denominator for basic earnings per share—Weighted average shares (in millions) 50.5 51.8 52.2 Effect of dilutive securities—Dilutive securities (in millions) 0.8 0.4 — Denominator for diluted earnings per share—Adjusted weighted average shares (in millions) 51.3 52.2 52.2 Basic net earnings (loss) per share $ 1.06 $ 0.93 $ (7.39) Diluted net earnings (loss) per share $ 1.04 $ 0.92 $ (7.39) Long‑Term Incentive Plan —The Company adopted a Long‑Term Incentive Plan (“LTIP”) similar to the Former Parent’s plan under which the Company’s Compensation Committee may grant stock options, stock appreciation rights, restricted stock, restricted stock units or other forms of equity based or equity related awards. All unvested shares of restricted stock granted by our Former Parent were transferred with the employees to KLX on the same terms and conditions on an exchange ratio of 1.8139 such that the impact was neutral to employees at the date of the Spin‑off. During 2014, B/E Aerospace granted restricted stock under the Former Parent’s plan to certain members of the Company’s management which vests over four years. During the three years ended January 31, 2018, the Company granted restricted stock to certain members of the Company’s Board of Directors and management. Restricted stock grants vest over periods ranging from three to four years and are granted at the discretion of the Compensation Committee of the Company’s Board of Directors. Certain awards also vest upon attainment of performance goals. Compensation cost is recorded on a straight‑line basis over the vesting term of the shares based on the grant date value using the closing trading price. Share based compensation of $22.2, $15.6 and $11.4 was recorded during fiscal year 2017, 2016 and 2015, respectively relating to these restricted stock grants. Unrecognized compensation cost related to these grants was $37.5 at January 31, 2018. The following table summarizes shares of restricted stock awards that were granted, vested, forfeited and outstanding: January 31, 2018 January 31, 2017 Weighted Weighted Weighted Average Weighted Average Average Remaining Average Remaining Shares Grant Date Vesting Period Shares Grant Date Vesting Period (in thousands) Fair Value (in years) (in thousands) Fair Value (in years) Outstanding, beginning of period 766.4 $ 38.57 2.44 827.2 $ 36.40 3.12 Shares granted 207.1 57.65 262.3 41.97 Shares vested (290.1) 39.75 (246.5) 35.72 Shares forfeited (72.2) 38.24 (76.6) 35.96 Outstanding, end of period 611.2 $ 44.52 1.98 766.4 $ 38.57 2.44 During the year ended January 31, 2018, the Company granted 113,387 units of time and performance based restricted stock. During the year ended January 31, 2018, 1,814 restricted stock units were forfeited. As of January 31, 2018, the weighted average remaining vesting period for the 452,051 outstanding restricted stock units was 1.73 years. Our stock options vested over three years in three equal annual installments, subject to continued employment on each vesting date. Vested options were exercisable at any time until 10 years from the date of the option grant, subject to earlier expirations under certain terminations of service and other conditions. The stock options granted had an exercise price equal to the closing stock price of our common stock on the grant date. At January 31, 2018 no unvested time-based stock options were outstanding under the KLX Inc. Long-Term Incentive Plan (the “Plan”) as all options were fully vested as of January 31, 2018. At January 31, 2017 we had 298,298 unvested time-based stock options outstanding. All of the time-based options vest ratably during the period of service. The following table sets forth the summary of options activity under the Plan (dollars in thousands except per share data): January 31, 2018 January 31, 2017 Weighted Weighted Weighted Average Weighted Average Average Remaining Aggregate Average Remaining Aggregate Number Exercise Contractual Life Intrinsic Number Exercise Contractual Life Intrinsic of Shares Price (in years) Value (1) of Shares Price (in years) Value (1) Outstanding, beginning of period 894,899 $ 39.08 7.96 $ 8,868.4 894,899 $ 39.08 8.96 $ — Granted — — — — Exercised 39.08 — — Canceled — — — — Outstanding, end of period — $ — — $ — 894,899 $ 39.08 7.96 $ 8,868.4 Exercisable, end of period — $ — — $ — 596,601 $ 39.08 7.96 $ 5,912.3 (1) Aggregate intrinsic value is calculated based on the difference between our closing stock price at year end and the exercise price, multiplied by the number of in-the-money options and represents the pre-tax amount that would have been received by the option holders, had they all exercised all their options on the fiscal year end date. For the year ended January 31, 2018 and 2017, we recorded $3.4 and $3.9, respectively, of stock-based compensation expense related to these options that is included within selling, general and administrative expenses. At January 31, 2018 and 2017, the unrecognized stock-based compensation related to these options was $0 and $7.7, respectively, and is expected to be recognized over a weighted-average period of 0 and 0.87 years, respectively. We use the Black-Scholes option pricing model to determine the fair value of stock options. The determination of the fair value of stock-based payment awards on the date of grant using an option-pricing model is affected by our stock price as well as assumptions regarding complex and subjective variables. These variables include the expected stock price volatility over the term of the awards, risk-free interest rate and expected dividends. Due to the limited trading history of our common stock, we estimated expected volatility based on historical data of comparable public companies. The expected term, which represents the period of time that options granted are expected to be outstanding, is estimated based on guidelines provided in U.S. Securities and Exchange Commission Staff Accounting Bulletin No. 110 and represents the average of the vesting tranches and contractual terms. The risk-free rate assumed in valuing the options is based on the U.S. Treasury rate in effect at the time of grant for the expected term of the option. We do not anticipate paying any cash dividends in the foreseeable future and, therefore, used an expected dividend yield of zero in the option pricing model. Compensation expense is recognized only for those options expected to vest with forfeitures estimated based on our historical experience at B/E Aerospace and future expectations. Stock-based compensation awards are amortized on a straight line basis over a three year period. The weighted average assumptions used to value the option grants were as follows: January 31, 2015 Expected life (in years) Volatility Risk free interest rate Dividend yield - The weighted average fair value per option at the grant date for options issued during the one month ended January 31, 2015 was $12.99. |
Employee Stock Purchase Plan
Employee Stock Purchase Plan | 12 Months Ended |
Jan. 31, 2018 | |
Employee Stock Purchase Plan | |
Employee Stock Purchase Plan | 12. EMPLOYEE STOCK PURCHASE PLAN KLX has established a qualified Employee Stock Purchase Plan, the terms of which allow for qualified employees (as defined in the Plan) to participate in the purchase of designated shares of KLX’s common stock at a price equal to 85% of the closing price on the last business day of each semi‑annual stock purchase period. KLX issued approximately 40,000, 51,000 and 50,000 shares of common stock to employees of the Company during the years ended January 31, 2018, 2017 and 2016, respectively, at a weighted average price per share of $49.14, $31.09 and $30.62, respectively. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Jan. 31, 2018 | |
Segment Reporting | |
Segment Reporting | 13. SEGMENT REPORTING The Company is organized based on the products and services it offers. The Company’s reportable segments, which are also its operating segments, are comprised of ASG and ESG. Each segment regularly reports its results of operations and makes requests for capital expenditures and acquisition funding to the Company’s chief operational decision‑making group. This group is comprised of the Chairman and Chief Executive Officer and the President and Chief Operating Officer. The Company has not included product line information for the ASG segment due to the similarity of the product offerings and services and the impracticality of determining such information. The following table presents revenues and other financial information by business segment: Year Ended January 31, 2018 Aerospace Solutions Group Energy Services Group Consolidated Revenues $ 1,420.2 $ 320.6 $ 1,740.8 Operating earnings (loss) (1) 238.5 (22.2) 216.3 Total assets (2) 3,495.8 294.2 3,790.0 Goodwill 1,056.8 — 1,056.8 Capital expenditures (3) 27.7 57.2 84.9 Depreciation and amortization 31.8 34.3 66.1 Year Ended January 31, 2017 Aerospace Solutions Group Energy Services Group Consolidated Revenues $ 1,340.9 $ 153.2 $ 1,494.1 Operating earnings (loss) (1) 220.6 (91.2) 129.4 Total assets (2) 3,471.4 226.9 3,698.3 Goodwill 996.4 — 996.4 Capital expenditures (3) 11.0 24.5 35.5 Depreciation and amortization 30.4 36.5 66.9 Year Ended January 31, 2016 Aerospace Solutions Group Energy Services Group Consolidated Revenues $ 1,312.5 $ 254.9 $ 1,567.4 Operating earnings (loss) (1) 211.6 (748.4) (536.8) Total assets (2) 3,422.8 268.2 3,691.0 Goodwill 952.4 2.5 954.9 Capital expenditures (3) 30.4 100.1 130.5 Depreciation and amortization 28.1 46.9 75.0 (1) Operating earnings (loss) includes an allocation of corporate IT costs, employee benefits and general and administrative costs. The allocations were made on a direct usage basis when identifiable, with the remainder allocated on the basis of revenues generated, costs incurred, headcount or other measures. (2) Corporate assets (including cash and cash equivalents) of $263.6, $378.2 and $559.5 at January 31, 2018, 2017 and 2016, respectively, have been allocated to the above segments based on each segment’s percentage of total assets. (3) Corporate capital expenditures have been allocated to the above segments based on each segment’s percentage of total capital expenditures. Geographic Information The Company operates principally in three geographic areas, the United States, Europe (primarily Germany) and emerging markets, such as Asia, the Pacific Rim and the Middle East. There were no significant transfers among geographic areas during these periods. The following table presents revenues and operating earnings (loss) based on the originating location for the years ended January 31, 2018, 2017 and 2016. Additionally, it presents all identifiable assets related to the operations in each geographic area as of January 31, 2018 and 2017: Year Ended January 31, 2018 2017 2016 Revenues: Domestic $ 1,734.2 $ 1,423.8 $ 1,453.4 Foreign 6.6 70.3 114.0 $ 1,740.8 $ 1,494.1 $ 1,567.4 Operating earnings (loss): Domestic $ 198.8 $ 109.3 $ (561.0) Foreign 17.5 20.1 24.2 $ 216.3 $ 129.4 $ (536.8) January 31, 2018 January 31, 2017 Identifiable assets: Domestic $ 3,260.7 $ 3,214.1 Foreign 529.3 484.2 $ 3,790.0 $ 3,698.3 Revenues by geographic area, based on destination, for the years ended January 31, 2018, 2017 and 2016 were as follows: Year Ended January 31, 2018 2017 2016 % of % of % of Revenues Revenues Revenues Revenues Revenues Revenues United States $ 62.6 % $ 865.6 57.9 % $ 955.3 61.0 % Europe 382.7 22.0 % 387.9 26.0 % 376.3 24.0 % Asia, Pacific Rim, Middle East and other 267.7 15.4 % 240.6 16.1 % 235.8 15.0 % Total revenues $ 1,740.8 100.0 % $ 1,494.1 100.0 % $ 1,567.4 100.0 % Export revenues from the United States to customers in foreign countries amounted to $643.8, $511.1 and $457.9 in the years ended January 31, 2018, 2017 and 2016, respectively. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jan. 31, 2018 | |
Fair Value Information | |
Fair Value Information | 14. FAIR VALUE INFORMATION All financial instruments are carried at amounts that approximate estimated fair value. The fair value is the price at which an asset could be exchanged in a current transaction between knowledgeable, willing parties. Assets measured at fair value are categorized based upon the lowest level of significant input to the valuations. Level 1—quoted prices in active markets for identical assets and liabilities. Level 2—quoted prices for identical assets and liabilities in markets that are not active or observable inputs other than quoted prices in active markets for identical assets and liabilities. Level 3—unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions. The carrying amounts of cash and cash equivalents (which the Company classifies as Level 1 assets), accounts receivable‑trade and accounts payable represent their respective fair values due to their short‑term nature. There was no debt outstanding under the Revolving Credit Facility as of January 31, 2018 and 2017. The fair value of the Company’s 5.875% Notes, based on market prices for publicly‑traded debt (which the Company classifies as Level 2 inputs), was $1,251.0 and $1,260.7 as of January 31, 2018 and 2017, respectively. Goodwill and long-lived assets, including property and equipment and purchased intangibles subject to amortization were impaired and written down to their estimated fair values during the third quarter of Fiscal 2015. The goodwill level 3 fair value was determined using an income based approach utilizing estimates of future cash flow, discount rate and long-term growth rate, all of which were unobservable. The long-lived asset level 3 fair value was determined using a combination of the cost approach and the market approach, which used inputs that included replacement costs (unobservable), physical deterioration estimates (unobservable), economic obsolescence (unobservable), and market sales data for comparable assets. The following table summarizes impairments of goodwill and long-lived assets and the related post impairment fair values of the corresponding ESG assets for the year ended January 31, 2016: Year Ended January 31, 2016 Impairment Fair Value Property and equipment, net $ 152.0 $ 174.3 Goodwill 310.4 — Intangible assets 177.8 — $ 640.2 $ 174.3 Fair value is measured as of the impairment date using Level 3 inputs. See Note 4 for a discussion of the asset impairment charge recorded during the third quarter of Fiscal 2015. The fair value information presented herein is based on pertinent information available to management at January 31, 2018 and 2017, respectively. Although management is not aware of any factors that would significantly affect the estimated fair value amounts, such amounts have not been comprehensively revalued for purposes of these consolidated and combined financial statements since those dates, and current estimates of fair value may differ significantly from the amounts presented herein. |
Selected Quarterly Data (Unaudi
Selected Quarterly Data (Unaudited) | 12 Months Ended |
Jan. 31, 2018 | |
Selected Quarterly Data (Unaudited) | |
Selected Quarterly Data (Unaudited) | 15. SELECTED QUARTERLY DATA ( Unaudited) Summarized quarterly financial data for the years ended January 31, 2018 and 2017 are as follows: Year Ended January 31, 2018 First Second Third Fourth Quarter Quarter Quarter Quarter Revenues $ 411.3 $ 430.6 $ 456.7 $ 442.2 Cost of sales 298.4 312.0 331.7 321.7 Net earnings 18.4 20.7 25.8 (11.5) Basic net earnings per share (1) 0.36 0.41 0.52 (0.23) Diluted net earnings per share (1) 0.36 0.40 0.51 (0.23) (1) Net earnings per share are computed individually for each quarter presented. Therefore, the sum of the quarterly net earnings per share may not necessarily equal the total for the year. Year Ended January 31, 2017 First Second Third Fourth Quarter Quarter Quarter Quarter Revenues $ 352.8 $ 378.9 $ 389.0 $ 373.4 Cost of sales 269.3 286.4 289.0 281.4 Net earnings 2.5 8.0 19.8 17.9 Basic net earnings per share (1) 0.05 0.15 0.38 0.35 Diluted net earnings per share (1) 0.05 0.15 0.38 0.34 (1) Net earnings per share are computed individually for each quarter presented. Therefore, the sum of the quarterly net earnings per share may not necessarily equal the total for the year. |
Valuation and Qualifying Accoun
Valuation and Qualifying Accounts | 12 Months Ended |
Jan. 31, 2018 | |
Valuation and Qualifying Accounts | |
Valuation And Qualifying Accounts | SCHEDULE II—VALUATION FOR THE YEARS ENDED JANUARY 31, 2018, 2017 AND 2016 (In millions) Balance At Balance At Beginning Write-Offs/ End Of Period Expenses Other Disposals Of Period Deducted From Assets: Allowance for doubtful accounts: Year ended January 31, 2018 $ 13.5 $ 3.9 $ 0.3 $ 5.7 $ 12.0 Year ended January 31, 2017 11.3 4.0 — 1.8 13.5 Year ended January 31, 2016 8.0 4.1 — 0.8 11.3 Reserve for inventory: Year ended January 31, 2018 $ 59.6 $ 17.2 $ — $ 4.4 $ 72.4 Year ended January 31, 2017 40.4 20.7 — 1.5 59.6 Year ended January 31, 2016 33.5 7.7 — 0.8 40.4 Deferred tax asset valuation allowance: Year ended January 31, 2018 $ 17.8 $ 0.7 $ 6.3 $ — $ Year ended January 31, 2017 21.9 — (1.6) (2.5) 17.8 Year ended January 31, 2016 24.8 — 5.3 (8.2) 21.9 |
Description of Business and S23
Description of Business and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 31, 2018 | |
Description of Business and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements include KLX and its wholly owned subsidiaries were prepared in accordance with accounting principles generally accepted in the United States (GAAP). All intercompany transactions and account balances within the Company have been eliminated. |
Use of Estimates | Use of Estimates —The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and related disclosures. Actual results could differ from those estimates. |
Revenue Recognition | Revenue Recognition —Sales of products and services are recorded when the earnings process is complete. This generally occurs when the products are shipped to the customer in accordance with the contract or purchase order, risk of loss and title has passed to the customer, collectability is reasonably assured and pricing is fixed and determinable. In instances where title does not pass to the customer upon shipment, the Company recognizes revenue upon delivery or customer acceptance, depending on the terms of the sales contract. Management provides allowances for credits and returns, based on historic experience, and adjusts such allowances as considered necessary. In connection with the sales of its products, the Company also provides certain supply chain management services to certain of its customers. These services include the timely replenishment of products at the customer site, while also minimizing the customer’s on‑hand inventory. These services are provided by the Company contemporaneously with the delivery of the product, and as such, once the product is delivered, the Company does not have a post‑delivery obligation to provide services to the customer. The price of such services is generally included in the price of the products delivered to the customer, and revenue is recognized upon delivery of the product, at which point, the Company has satisfied its obligations to the customer. The Company does not account for these services as a separate element, as the services do not have stand‑alone value and cannot be separated from the product element of the arrangement. Service revenues from oilfield technical services and related rental equipment are recorded when services are performed and/or equipment is rented pursuant to a completed purchase order or master services agreement (“MSA”) that sets forth firm pricing and payment terms. |
Income Taxes | Income Taxes —The Company provides deferred income taxes for temporary differences between the amounts of assets and liabilities recognized for financial reporting purposes and such amounts recognized for income tax purposes. Deferred income taxes are computed using enacted tax rates that are expected to be in effect when the temporary differences reverse. A valuation allowance related to a deferred tax asset is recorded when it is more likely than not that some portion or the entire deferred tax asset will not be realized. The Company records uncertain tax positions within income tax expense and classifies interest and penalties related to income taxes as income tax expense. |
Cash Equivalents | Cash Equivalents —The Company considers all highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents. |
Accounts Receivable, Net | Accounts Receivable, Net —The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and the customer’s current creditworthiness, as determined by review of their current credit information. The Company continuously monitors collections and payments from its customers and maintains a provision for estimated credit losses based upon historical experience and any specific customer collection issues that have been identified. The allowance for doubtful accounts at January 31, 2018 and 2017 was $12.0 and $13.5, respectively. |
Inventories | Inventories —Inventories, made up of finished goods, primarily consist of aerospace fasteners and consumables. The Company values inventories at the lower of cost and net realizable value, using first‑in, first‑out or weighted average cost method. During the year ended January 31, 2017 (“Fiscal 2016”), the Company revised its methodology for estimating the provision required for excess and obsolete (“E&O”) inventories. The new methodology more adequately considers historical demand of our inventory to project future demand in order to estimate the provision required for E&O inventories. Other factors considered in the methodology include expected market growth rates and related elements. The implementation of the new methodology did not impact any prior period reserve for E&O inventory. Demand for the Company’s products can fluctuate from period to period depending on customer activity. In accordance with industry practice, costs in inventory include amounts relating to long-term contracts with long production cycles and to inventory items with long production cycles, some of which are not expected to be realized within one year. As a result, the Company’s operating cycle is greater than a year and is closely tied to the lifecycle of an airframe. Inventory reserves were approximately $72.4 and $59.6 as of January 31, 2018 and 2017, respectively. Substantially all of the Company’s inventory is comprised of aerospace grade fasteners which support OEM production and the aftermarket over the life of the airframe. Inventory with a limited shelf life is continually monitored and reserved for in advance of expiration. The reserve for inventory with limited shelf life is not material to the Company’s financial statements. |
Property and Equipment, Net | Property and Equipment, Net —Property and equipment are stated at cost and depreciated generally under the straight‑line method over their estimated useful lives of one to thirty years (or the lesser of the term of the lease for leasehold improvements, as appropriate). |
Goodwill and Intangible Assets, Net | Goodwill and Intangible Assets, Net —Under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 350, Intangibles — Goodwill and Other (“ASC 350”), goodwill and indefinite‑lived intangible assets are reviewed at least annually for impairment. Acquired intangible assets with definite lives are amortized over their individual useful lives. Other intangible assets are amortized using the straight‑line method over periods ranging from five to thirty years. As of January 31, 2018, the Company had two reporting units, which were determined based on the guidelines contained in FASB ASC Topic 350, Subtopic 20, Section 35. Each reporting unit constitutes a business, for which there is discrete financial information available that is regularly reviewed by the management of the Company. Goodwill is tested at least annually as of December 31 st , and management assesses whether there has been any impairment in the value of goodwill by comparing the fair value to the net carrying value of the reporting units. If the carrying value exceeds its estimated fair value, an impairment loss is recognized for the difference in accordance with the Company’s adoption of the new accounting principle discussed below. In this event, the asset is written down accordingly. The fair values of the reporting units for goodwill impairment testing is determined using valuation techniques based on estimates, judgments and assumptions management believes are appropriate in the circumstances. The indefinite‑lived intangible asset is tested at least annually for impairment. Impairment for the intangible asset with an indefinite life exists if the carrying value of the intangible asset exceeds its fair value. The fair value of the indefinite‑lived intangible asset is determined using valuation techniques based on estimates, judgments and assumptions management believes are appropriate in the circumstances. For the years ended January 31, 2018 and 2017, the Company’s annual impairment testing yielded no impairments of goodwill or the indefinite‑lived intangible asset. For the year ended January 31, 2016, the Company determined goodwill related to the Energy Services Group (“ESG”) reporting unit was fully impaired and recorded a pre-tax impairment charge related to ESG’s goodwill of $310.4. |
Long-Lived Assets | Long‑Lived Assets —The Company assesses potential impairments to its long‑lived assets when there is evidence that events or changes in circumstances indicate that the carrying amount of an asset may not be recovered. An impairment loss is recognized when the undiscounted cash flows expected to be generated by an asset (or group of assets) is less than its carrying amount. Any required impairment loss is measured as the amount by which the asset’s carrying value exceeds its fair value and is recorded as a reduction in the carrying value of the related asset and a charge to operating results. For the years ended January 31, 2018 and 2017, there were no impairments of long lived assets. For the year ended January 31, 2016, the Company used a combination of cost and market approaches for determining the fair value of the ESG asset group’s long-lived assets and recognized impairment charges related to identified intangibles and property and equipment of $177.8 and $152.0, respectively. |
Common Stock Equivalents | Common Stock Equivalents —The Company has potential common stock equivalents related to its outstanding restricted stock awards, restricted stock units and employee stock purchase plan. These potential common stock equivalents are not included in diluted loss per share for any period presented in which there is a net loss because the effect would have been anti‑dilutive. |
Accounting for Stock-Based Compensation | Accounting for Stock‑Based Compensation —The Company accounts for share‑based compensation arrangements in accordance with the provisions of FASB ASC 718, Compensation—Stock Compensation (“ASC 718”), whereby share‑based compensation cost is measured on the date of grant, based on the fair value of the award, and is recognized over the requisite service period. All unvested shares of restricted stock granted by B/E Aerospace, Inc. (our Former Parent) were converted into unvested shares of KLX on the distribution date at a ratio equal to 1.8139. Compensation cost recognized during the three years ended January 31, 2018 (“Fiscal 2017”) related to unvested shares converted on the distribution date and new shares of KLX restricted stock and stock options granted during the three years ended January 31, 2018. The Company has established a qualified Employee Stock Purchase Plan. The Employee Stock Purchase Plan allows qualified employees (as defined in the plan) to participate in the purchase of designated shares of KLX’s common stock at a price equal to 85% of the closing price for each semi‑annual stock purchase period. The fair value of employee purchase rights represents the difference between the closing price of KLX’s shares on the date of purchase and the purchase price of the shares. The value of the rights under this Plan granted during the years ended January 31, 2018, 2017 and 2016 was $0.4, $0.3 and $0.3, respectively. |
Foreign Currency Translation | Foreign Currency Translation —The assets and liabilities of subsidiaries located outside the United States are translated into U.S. dollars at the rates of exchange in effect at the balance sheet dates. Revenue and expense items are translated at the average exchange rates prevailing during the period. Gains and losses resulting from foreign currency transactions are recognized currently in income, and those resulting from translation of financial statements are accumulated as a separate component of equity and accumulated other comprehensive income (loss). The Company’s European subsidiaries primarily utilize the British pound or the Euro as their local functional currency. |
Treasury Stock | Treasury Stock - The Company may periodically repurchase shares of its common stock from employees for the satisfaction of their individual payroll tax withholding upon vesting of restricted stock and restricted stock units in connection with the Company’s Long-Term Incentive Plan (“LTIP”). The Company’s repurchases of common stock are recorded at the average cost of the common stock. As part of the LTIP, the Company repurchased 713,210 and 35,009 shares of its common stock for $48.9 and $1.5 during the years ended January 31, 2018 and 2017. In January 2016, the Board of Directors authorized a $100.0 share repurchase under the existing $250.0 share repurchase program. In March 2017, the Board of Directors authorized an increase in the Company’s share repurchase authority from $100.0 to $200.0. During Fiscal 2017, the Company repurchased 1,652,661 shares of common stock at an average price of $48.04 per share for a total of $79.4 as part of the share repurchase program. During Fiscal 2016, the Company repurchased 982,062 shares of common stock at an average price of $41.20 per share for a total of $40.5 as part of the share repurchase program. |
Concentration of Risk | Concentration of Risk —In Aerospace Solutions Group (“ASG”), the Company’s products and services are primarily concentrated within the aerospace industry with customers consisting primarily of commercial airlines, a wide variety of business jet customers and commercial aircraft manufacturers and their suppliers. In ESG, the Company provides products and services to energy industry customers who focus on developing and producing oil and gas onshore in North America. The Company’s management performs ongoing credit evaluations on the financial condition of all of its customers and maintains allowances for uncollectible accounts receivable based on expected collectability. Credit losses have historically been within management’s expectations and the provisions established. Significant customers change from year to year, in the case of ASG, depending on the level of refurbishment activity and/or the level of new aircraft purchases by such customers, and in the case of ESG, depending on the level of exploration and production activity and the use of our services. During the years ended January 31, 2018, 2017 and 2016, no single customer accounted for more than 10% of the Company’s consolidated revenues. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2017, the FASB issued Accounting Standards Update (“ASU”) 2017-09, Compensation–Stock Compensation (Topic 718). This ASU was issued to provide clarity and reduce diversity in practice regarding the application of guidance on the modification of equity awards. The ASU states that an entity should account for the effects of a modification unless all of the following are met: the fair value, vesting conditions and the classification of the instrument as equity or liability of the modified award is the same as that of the original award immediately before such award is modified. The guidance is effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual reporting periods with early adoption permitted and should be applied prospectively to an award modified on or after the adoption date. The Company does not expect a material impact upon adoption of this ASU to its consolidated financial statements as the Company historically has accounted for all modifications in accordance with Topic 718 and has not been subject to the exception described under this ASU. In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other. ASU 2017-04 simplifies the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires an entity to perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An impairment charge should be recognized for the amount by which the carrying amount exceeds the reporting unit's fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendment should be applied on a prospective basis. ASU 2017-04 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted, and the Company adopted the new standard during the fourth quarter of 2017. The adoption of ASU 2017-04 did not have an impact on the Company’s consolidated financial statements; however, the Company will no longer perform the second step of the goodwill impairment test where applicable in future impairment tests. In January 2017, the FASB issued ASU 2017-01, Business Combinations. This update clarifies the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. This ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The adoption of ASU 2017-01 is not expected to have a material impact on the Company’s consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, which eliminates a current exception in U.S. GAAP to the recognition of the income tax effects of temporary differences that result from intra-entity transfers of non-inventory assets. The intra-entity exception is being eliminated under the ASU. The standard is required to be applied on a modified retrospective basis and will be effective beginning with the first quarter of 2018. Early adoption is permitted, and the Company adopted the new standard during the first quarter of 2017, which resulted in the elimination of a $7.7 long-term prepaid tax balance and the recognition of a $8.8 longterm deferred tax asset with the offset recorded to the accumulated deficit. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”) related to how certain cash receipts and payments are presented and classified in the statement of cash flows. These cash flow issues include debt prepayment or extinguishment costs, settlement of zero-coupon debt, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, distributions received from equity method investees, beneficial interests in securitization transactions, and separately identifiable cash flows. This ASU is effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years with early adoption permitted and should be applied retrospectively. The Company does not expect a material impact upon adoption of this ASU to its consolidated financial statements as the Company’s consolidated statements of cash flows are not impacted by the eight issues listed above, with the exception of the contingent consideration payments, which will not be presented in the year of adoption. In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation – Stock Compensation. The ASU includes multiple provisions intended to simplify various aspects of the accounting for share-based payments, including that excess tax benefits and shortfalls be recorded as income tax benefit or expense in the income statement, rather than equity, and requires excess tax benefits from stock-based compensation to be classified in cash flow from operations. The Company adopted the new standard during the first quarter of 2017 in compliance with the effective date, which resulted in the recognition of a $0.5 long-term deferred tax asset with the offset recorded to accumulated deficit. Prior year periods have been adjusted to conform to the current year presentation. With respect to forfeitures, the Company will continue to estimate the number of awards expected to be forfeited upon award issuance. In February 2016, the FASB issued ASU 2016-02, Leases , which supersedes ASC Topic 840, Leases , and creates a new topic, ASC Topic 842, Leases . This update is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Earlier adoption is permitted. ASU 2016-02 requires lessees to recognize a lease liability and a lease asset for all leases, including operating leases, with a term greater than 12 months on its balance sheet. The update also expands the required quantitative and qualitative disclosures surrounding leases. ASU 2016-02 will be applied using a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the effect of this update on its consolidated financial statements. In May 2014, FASB issued ASU 2014-09, Revenue from Contracts with Customers, which updated the guidance in ASC Topic 606, Revenue Recognition. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should identify the contract(s) with a customer, identify the performance obligations in the contract, determine the transaction price, allocate the transaction price to the performance obligations in the contract and recognize revenue when (or as) the entity satisfies a performance obligation. In August 2015, the FASB deferred the effective date for implementation of ASU 2014-09 by one year and during 2016, the FASB issued various related accounting standard updates, which clarified revenue accounting principles and provided supplemental adoption guidance. The guidance under ASU 2014-09 is effective for fiscal years beginning after December 15, 2017, including interim reporting periods within that year. To assess the impact of this guidance, the Company established a cross functional implementation project team, inventoried its revenue streams and contracts with customers at its two segments and applied the principles of the guidance against a selection of contracts to assist in the determination of potential revenue accounting differences. No individually significant implementation matters were identified, and our revenue will be recognized on a “point-in-time” basis for product revenues and over time for service revenues under the new standard, which is consistent with current practice. The Company implemented internal controls, policies and processes to comply with the new standard. The Company adopted ASC Topic 606 in the first quarter of 2018 using the modified retrospective method of adoption, which resulted in no changes to the opening consolidated balance sheet as of February 1, 2018. Prior period consolidated statements of earnings and comprehensive income will remain unchanged. |
Business Combinations (Tables)
Business Combinations (Tables) - Herndon | 12 Months Ended |
Jan. 31, 2018 | |
Schedule of Fair Values of Assets Acquired and Liabilities Assumed | Accounts receivable-trade $ 12.3 Inventories 103.8 Other current and non-current assets 3.7 Property and equipment 2.1 Goodwill 50.7 Identified intangibles 68.9 Accounts payable (9.7) Other current and non-current liabilities (11.0) Total consideration paid $ 220.8 |
Pro Forma Revenues, Net Earnings (Loss) and Diluted Net Earnings (Loss) Per Share | UNAUDITED YEAR ENDED January 31, 2017 January 31, 2016 Pro forma Pro forma Revenues $ 1,544.3 $ 1,699.8 Net earnings (loss) 51.7 (376.7) Earnings (loss) per diluted share 0.99 (7.21) |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Property and Equipment, Net | |
Property and Equipment | Useful January 31, January 31, Life (Years) 2018 2017 Land, buildings and improvements 1 - 30 $ 48.7 $ 40.9 Machinery 2 - 20 142.1 119.8 Computer equipment and software 1 - 15 123.7 105.5 Furniture and equipment 3 - 20 163.0 131.5 477.5 397.7 Less accumulated depreciation 191.1 149.4 $ 286.4 $ 248.3 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Goodwill and Intangible Assets | |
Intangible Assets by Major Asset Class | January 31, 2018 January 31, 2017 Useful Life Original Accumulated Net Book Original Accumulated Net Book (Years) Cost Amortization Value Cost Amortization Value Customer contracts and relationships - 30 $ 413.6 $ 128.8 $ 284.8 $ 422.0 $ 129.1 $ 292.9 Covenants not to compete 5 2.2 0.7 1.5 5.5 3.6 1.9 Developed technologies 15 3.3 0.5 2.8 3.3 0.2 3.1 Trade names Indefinite 19.5 - 19.5 16.9 - 16.9 $ 438.6 $ 130.0 $ 308.6 $ 447.7 $ 132.9 $ 314.8 |
Schedule of carrying amount of goodwill | Balance, January 31, 2016 $ 954.9 Acquisitions 50.8 Purchase Price Adjustments (2.5) Effect of foreign currency translation (6.8) Balance, January 31, 2017 996.4 Acquisitions 17.3 Purchase Price Adjustments (0.1) Effect of foreign currency translation 43.2 Balance, January 31, 2018 $ 1,056.8 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Accrued Liabilities | |
Accrued Liabilities | January 31, 2018 January 31, 2017 Accrued salaries, vacation and related benefits $ 37.2 $ 31.6 Accrued commissions 10.9 8.7 Income taxes payable 10.7 10.3 Accrued interest 11.7 11.7 Other accrued liabilities 36.2 28.8 $ 106.7 $ 91.1 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Long-Term Debt | |
Long-Term Debt | January 31, 2018 January 31, 2017 Senior unsecured notes $ 1,200.0 $ 1,200.0 Less unamortized original issue discount and debt issue costs 15.4 18.0 $ 1,184.6 $ 1,182.0 |
Maturities of Long-Term Debt | Year Ending January 31, 2019 $ — 2020 — 2021 — 2022 — 2023 1,200.0 Thereafter — Total $ 1,200.0 |
Commitments, Contingencies An29
Commitments, Contingencies And Off-Balance-Sheet Arrangements (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Commitments, Contingencies and Off-Balance Sheet Arrangements | |
Future Payments under Operating Leases with Terms Greater Than One Year | Year Ending January 31, 2019 $ 31.2 2020 30.1 2021 24.7 2022 20.6 2023 15.0 Thereafter 68.5 Total $ 190.1 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Income Taxes | |
Components of Earnings (Loss) Before Incomes Taxes | Year Ended January 31, 2018 2017 2016 Earnings (loss) before income taxes United States $ 128.3 $ 41.3 $ (624.4) Foreign 12.2 12.2 10.3 Earnings (loss) before income taxes $ 140.5 $ 53.5 $ (614.1) |
Components of Income Tax Expense (Benefit) | Year Ended January 31, 2018 2017 2016 Current: Federal $ (0.2) $ — $ 0.7 State 0.8 0.3 (1.5) Foreign 5.1 (1.3) 3.8 5.7 (1.0) 3.0 Deferred: Federal 79.8 14.4 (213.3) State 2.9 1.3 (17.4) Foreign (1.3) (9.4) (0.6) 81.4 6.3 (231.3) Total income tax expense (benefit) $ 87.1 $ 5.3 $ (228.3) |
Difference Between Income Tax Expense (Benefit) and Amount Computed by Applying Statutory United States Federal Income Tax Rate to Pre-Tax Earnings | Year Ended January 31, 2018 2017 2016 Statutory federal income tax expense (benefit) $ 47.5 $ 18.7 $ (214.9) U.S. state income taxes 3.4 1.5 (17.5) Foreign tax rate differential (0.1) 0.1 (0.2) Change in unrecognized tax benefits 0.2 (7.8) 0.4 Change in valuation allowance on foreign 6.3 (1.6) 5.3 Other, net 0.7 1.3 2.0 Non-taxable/non-deductible items (6.0) (6.9) (3.4) Stock compensation (7.2) — — Change in tax rate 42.3 — — $ 87.1 $ 5.3 $ (228.3) |
Tax Effects of Temporary Differences and Carryforwards that Give Rise to Deferred Income Tax Assets and Liabilities | January 31, 2018 January 31, 2017 Deferred tax assets: Inventory reserves $ 19.8 $ 24.8 Accrued liabilities 9.8 12.9 Intangible Assets 13.4 44.2 Net operating loss carryforward 70.3 81.2 Inventory capitalization 9.3 14.9 Other 14.8 19.9 137.4 197.9 Deferred tax liabilities: Intangible assets (13.7) (12.8) Depreciation (30.3) (25.3) (44.0) (38.1) Net deferred tax asset before valuation allowance 93.4 159.8 Valuation allowance (24.8) (17.8) Net deferred tax asset $ 68.6 $ 142.0 |
Reconciliation of Beginning and Ending Amounts of Gross Uncertain Tax Positions | January 31, 2018 January 31, 2017 January 31, 2016 Unrecognized tax benefit at beginning of period $ 7.2 $ 9.0 $ 9.4 Additions for current year tax positions 0.1 4.6 — Additions for prior year tax positions — 1.3 — Decreases for prior year tax positions — (7.6) — Foreign currency fluctuations 1.1 (0.1) (0.4) Unrecognized tax benefit at end of period $ 8.4 $ 7.2 $ 9.0 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Stockholders' Equity | |
Computation of Basic and Diluted Net Earnings Per Share | Year Ended January 31, 2018 2017 2016 Numerator: net earnings (loss) $ 53.4 $ 48.2 $ (385.8) Denominator: Denominator for basic earnings per share—Weighted average shares (in millions) 50.5 51.8 52.2 Effect of dilutive securities—Dilutive securities (in millions) 0.8 0.4 — Denominator for diluted earnings per share—Adjusted weighted average shares (in millions) 51.3 52.2 52.2 Basic net earnings (loss) per share $ 1.06 $ 0.93 $ (7.39) Diluted net earnings (loss) per share $ 1.04 $ 0.92 $ (7.39) |
Restricted Stock Shares Granted, Vested, Forfeited and Outstanding | January 31, 2018 January 31, 2017 Weighted Weighted Weighted Average Weighted Average Average Remaining Average Remaining Shares Grant Date Vesting Period Shares Grant Date Vesting Period (in thousands) Fair Value (in years) (in thousands) Fair Value (in years) Outstanding, beginning of period 766.4 $ 38.57 2.44 827.2 $ 36.40 3.12 Shares granted 207.1 57.65 262.3 41.97 Shares vested (290.1) 39.75 (246.5) 35.72 Shares forfeited (72.2) 38.24 (76.6) 35.96 Outstanding, end of period 611.2 $ 44.52 1.98 766.4 $ 38.57 2.44 |
Summary of Options Activity | The following table sets forth the summary of options activity under the Plan (dollars in thousands except per share data): January 31, 2018 January 31, 2017 Weighted Weighted Weighted Average Weighted Average Average Remaining Aggregate Average Remaining Aggregate Number Exercise Contractual Life Intrinsic Number Exercise Contractual Life Intrinsic of Shares Price (in years) Value (1) of Shares Price (in years) Value (1) Outstanding, beginning of period 894,899 $ 39.08 7.96 $ 8,868.4 894,899 $ 39.08 8.96 $ — Granted — — — — Exercised 39.08 — — Canceled — — — — Outstanding, end of period — $ — — $ — 894,899 $ 39.08 7.96 $ 8,868.4 Exercisable, end of period — $ — — $ — 596,601 $ 39.08 7.96 $ 5,912.3 (1) Aggregate intrinsic value is calculated based on the difference between our closing stock price at year end and the exercise price, multiplied by the number of in-the-money options and represents the pre-tax amount that would have been received by the option holders, had they all exercised all their options on the fiscal year end date. |
Weighted Average Assumptions Used to Value Option Grants | January 31, 2015 Expected life (in years) Volatility Risk free interest rate Dividend yield - |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Segment Reporting | |
Revenues and Other Financial Information by Business Segment | Year Ended January 31, 2018 Aerospace Solutions Group Energy Services Group Consolidated Revenues $ 1,420.2 $ 320.6 $ 1,740.8 Operating earnings (loss) (1) 238.5 (22.2) 216.3 Total assets (2) 3,495.8 294.2 3,790.0 Goodwill 1,056.8 — 1,056.8 Capital expenditures (3) 27.7 57.2 84.9 Depreciation and amortization 31.8 34.3 66.1 Year Ended January 31, 2017 Aerospace Solutions Group Energy Services Group Consolidated Revenues $ 1,340.9 $ 153.2 $ 1,494.1 Operating earnings (loss) (1) 220.6 (91.2) 129.4 Total assets (2) 3,471.4 226.9 3,698.3 Goodwill 996.4 — 996.4 Capital expenditures (3) 11.0 24.5 35.5 Depreciation and amortization 30.4 36.5 66.9 Year Ended January 31, 2016 Aerospace Solutions Group Energy Services Group Consolidated Revenues $ 1,312.5 $ 254.9 $ 1,567.4 Operating earnings (loss) (1) 211.6 (748.4) (536.8) Total assets (2) 3,422.8 268.2 3,691.0 Goodwill 952.4 2.5 954.9 Capital expenditures (3) 30.4 100.1 130.5 Depreciation and amortization 28.1 46.9 75.0 (1) Operating earnings (loss) includes an allocation of corporate IT costs, employee benefits and general and administrative costs. The allocations were made on a direct usage basis when identifiable, with the remainder allocated on the basis of revenues generated, costs incurred, headcount or other measures. (2) Corporate assets (including cash and cash equivalents) of $263.6, $378.2 and $559.5 at January 31, 2018, 2017 and 2016, respectively, have been allocated to the above segments based on each segment’s percentage of total assets. (3) Corporate capital expenditures have been allocated to the above segments based on each segment’s percentage of total capital expenditures. |
Revenues and Operating Earnings Based on Originating Location | Year Ended January 31, 2018 2017 2016 Revenues: Domestic $ 1,734.2 $ 1,423.8 $ 1,453.4 Foreign 6.6 70.3 114.0 $ 1,740.8 $ 1,494.1 $ 1,567.4 Operating earnings (loss): Domestic $ 198.8 $ 109.3 $ (561.0) Foreign 17.5 20.1 24.2 $ 216.3 $ 129.4 $ (536.8) |
Total Assets by Reportable Segment | January 31, 2018 January 31, 2017 Identifiable assets: Domestic $ 3,260.7 $ 3,214.1 Foreign 529.3 484.2 $ 3,790.0 $ 3,698.3 |
Revenues by Geographic Area Based on Destination | Year Ended January 31, 2018 2017 2016 % of % of % of Revenues Revenues Revenues Revenues Revenues Revenues United States $ 62.6 % $ 865.6 57.9 % $ 955.3 61.0 % Europe 382.7 22.0 % 387.9 26.0 % 376.3 24.0 % Asia, Pacific Rim, Middle East and other 267.7 15.4 % 240.6 16.1 % 235.8 15.0 % Total revenues $ 1,740.8 100.0 % $ 1,494.1 100.0 % $ 1,567.4 100.0 % |
Fair Value Information (Tables)
Fair Value Information (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Fair Value Information | |
Summary of Impairments of Goodwill and Long-lived Assets | Year Ended January 31, 2016 Impairment Fair Value Property and equipment, net $ 152.0 $ 174.3 Goodwill 310.4 — Intangible assets 177.8 — $ 640.2 $ 174.3 |
Selected Quarterly Data (Unau34
Selected Quarterly Data (Unaudited) (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Selected Quarterly Data (Unaudited) | |
Summary of Quarterly Financial Data | Summarized quarterly financial data for the years ended January 31, 2018 and 2017 are as follows: Year Ended January 31, 2018 First Second Third Fourth Quarter Quarter Quarter Quarter Revenues $ 411.3 $ 430.6 $ 456.7 $ 442.2 Cost of sales 298.4 312.0 331.7 321.7 Net earnings 18.4 20.7 25.8 (11.5) Basic net earnings per share (1) 0.36 0.41 0.52 (0.23) Diluted net earnings per share (1) 0.36 0.40 0.51 (0.23) (1) Net earnings per share are computed individually for each quarter presented. Therefore, the sum of the quarterly net earnings per share may not necessarily equal the total for the year. Year Ended January 31, 2017 First Second Third Fourth Quarter Quarter Quarter Quarter Revenues $ 352.8 $ 378.9 $ 389.0 $ 373.4 Cost of sales 269.3 286.4 289.0 281.4 Net earnings 2.5 8.0 19.8 17.9 Basic net earnings per share (1) 0.05 0.15 0.38 0.35 Diluted net earnings per share (1) 0.05 0.15 0.38 0.34 Net earnings per share are computed individually for each quarter presented. Therefore, the sum of the quarterly net earnings per share may not necessarily equal the total for the year. |
Description of Business and S35
Description of Business and Summary of Significant Accounting Policies (Details) $ / shares in Units, $ in Millions | Dec. 16, 2014 | Jan. 31, 2018USD ($)item$ / sharesshares | Jan. 31, 2017USD ($)item$ / sharesshares | Jan. 31, 2016USD ($)item | Apr. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Jan. 07, 2016USD ($) |
Accounts receivable, Net | |||||||
Accounts receivable - trade, allowance for doubtful accounts | $ 12 | $ 13.5 | |||||
Inventories | |||||||
Inventory reserves | $ 72.4 | 59.6 | |||||
Goodwill and Intangible Assets, Net | |||||||
Number of reporting units | item | 2 | ||||||
Goodwill impairment charge | $ 0 | 0 | $ 310.4 | ||||
Long-lived assets impairment | $ 0 | 0 | |||||
Accounting for Stock Based Compensation | |||||||
Unvested shares, distribution date conversion ratio | 1.8139 | ||||||
Qualified employees purchase of stock at a price equal to percentage of closing price | 85.00% | ||||||
Employee Stock Purchase Plan, rights granted | $ 0.4 | 0.3 | 0.3 | ||||
Treasury Stock | |||||||
Purchase of treasury stock | 128.3 | 41.9 | $ 12.5 | ||||
Recent Accounting Pronouncements | |||||||
Long-term deferred tax asset | 74.5 | 147 | |||||
Accumulated deficit | $ (280) | $ (328) | |||||
Accounting Standards Update 2016-16 | Early adoption | |||||||
Recent Accounting Pronouncements | |||||||
Long-term deferred tax asset | $ 8.8 | ||||||
Long-term prepaid tax balance | (7.7) | ||||||
Accounting Standards Update 2016-09 | |||||||
Recent Accounting Pronouncements | |||||||
Long-term deferred tax asset | 0.5 | ||||||
Accumulated deficit | $ 0.5 | ||||||
KLX Inc Long Term Incentive Plan | |||||||
Treasury Stock | |||||||
Purchase of treasury stock (shares) | shares | 713,210 | 35,009 | |||||
Purchase of treasury stock | $ 48.9 | $ 1.5 | |||||
Existing $250.0 Share Repurchase Program | |||||||
Treasury Stock | |||||||
Purchase of treasury stock (shares) | shares | 1,652,661 | 982,062 | |||||
Share repurchase program, authorized amount | $ 250 | $ 200 | $ 100 | ||||
Purchase of treasury stock | $ 79.4 | $ 40.5 | |||||
Repurchased shares, average price per share | $ / shares | $ 48.04 | $ 41.20 | |||||
Sales Revenues | Customer Concentration | |||||||
Concentration of Risk | |||||||
Concentration risk percentage | 10.00% | 10.00% | 10.00% | ||||
Number of customers exceeding the concentration risk percentage threshold | item | 0 | 0 | 0 | ||||
Energy Services Group | |||||||
Goodwill and Intangible Assets, Net | |||||||
Goodwill impairment charge | $ 310.4 | ||||||
Intangible assets impairment | 177.8 | ||||||
Property and equipment impairment | 152 | ||||||
Long-lived assets impairment | $ 329.8 | ||||||
Minimum | |||||||
Property and Equipment, Net | |||||||
Property and equipment, useful lives (years) | 1 year | ||||||
Goodwill and Intangible Assets, Net | |||||||
Intangible assets, useful lives | 5 years | ||||||
Maximum | |||||||
Property and Equipment, Net | |||||||
Property and equipment, useful lives (years) | 30 years | ||||||
Goodwill and Intangible Assets, Net | |||||||
Intangible assets, useful lives | 30 years |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Millions | May 17, 2016 | Jan. 31, 2017 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 |
Business Combinations | |||||
Purchase price, net of cash acquired | $ 64.8 | $ 220.8 | $ 4.3 | ||
Goodwill | $ 996.4 | 1,056.8 | 996.4 | $ 954.9 | |
Purchase price adjustments | $ (0.1) | (2.5) | |||
Minimum | |||||
Business Combinations | |||||
Useful Life (years) | 5 years | ||||
Maximum | |||||
Business Combinations | |||||
Useful Life (years) | 30 years | ||||
Herndon | |||||
Business Combinations | |||||
Purchase price, net of cash acquired | $ 220.8 | ||||
Identified intangible assets including goodwill | 119.6 | 119.6 | |||
Identified intangibles | 68.9 | 68.9 | |||
Goodwill | $ 50.7 | $ 50.7 | |||
Customer contracts and relationships | Minimum | |||||
Business Combinations | |||||
Useful Life (years) | 10 years | ||||
Customer contracts and relationships | Maximum | |||||
Business Combinations | |||||
Useful Life (years) | 30 years | ||||
Customer contracts and relationships | Herndon | |||||
Business Combinations | |||||
Useful Life (years) | 20 years | ||||
Covenants not to compete | |||||
Business Combinations | |||||
Useful Life (years) | 5 years | ||||
Covenants not to compete | Herndon | |||||
Business Combinations | |||||
Useful Life (years) | 5 years |
Business Combinations (Assets A
Business Combinations (Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2018 | |
Business Combination, Separately Recognized Transactions [Line Items] | |||
Goodwill | $ 996.4 | $ 954.9 | $ 1,056.8 |
Pro forma | |||
Unaudited pro forma revenues | 1,544.3 | 1,699.8 | |
Unaudited pro forma net earnings | $ 51.7 | $ (376.7) | |
Unaudited pro forma diluted net earnings (loss) per share | $ 0.99 | $ (7.21) | |
Herndon | |||
Business Combination, Separately Recognized Transactions [Line Items] | |||
Accounts receivable-trade | $ 12.3 | ||
Inventories | 103.8 | ||
Other current and non-current assets | 3.7 | ||
Property and equipment | 2.1 | ||
Goodwill | 50.7 | ||
Identified intangibles | 68.9 | ||
Accounts payable | (9.7) | ||
Other current and non-current liabilities | (11) | ||
Total consideration paid | $ 220.8 | ||
Two Product Lines | |||
Business Combination, Separately Recognized Transactions [Line Items] | |||
Total consideration paid | $ 64.8 |
Property and Equipment, Net (Pr
Property and Equipment, Net (Property and Equipment) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 477.5 | $ 397.7 |
Less accumulated depreciation | 191.1 | 149.4 |
Property, Plant and Equipment, Net, Total | $ 286.4 | 248.3 |
Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 1 year | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 30 years | |
Land, buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 48.7 | 40.9 |
Land, buildings and improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 1 year | |
Land, buildings and improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 30 years | |
Machinery | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 142.1 | 119.8 |
Machinery | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 2 years | |
Machinery | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 20 years | |
Computer Equipment and Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 123.7 | 105.5 |
Computer Equipment and Software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 1 year | |
Computer Equipment and Software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 15 years | |
Furniture and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 163 | $ 131.5 |
Furniture and equipment | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 3 years | |
Furniture and equipment | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, useful lives (years) | 20 years |
Property and Equipment, Net (De
Property and Equipment, Net (Depreciation Expense) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Property and Equipment, Net | |||
Depreciation expense | $ 46.8 | $ 47.3 | $ 51.3 |
Goodwill and Long-Lived Assets,
Goodwill and Long-Lived Assets, Net (Major Asset Classes) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Original Cost | $ 438.6 | $ 447.7 | |
Accumulated Amortization | 130 | 132.9 | |
Net Book Value | 308.6 | 314.8 | |
Approximate percentage decrease in the number of onshore drilling rigs | 75.00% | ||
Goodwill impairment charge | 0 | 0 | $ 310.4 |
Impairment of indefinite lived intangibles | 0 | 0 | |
Impairment of Long-Lived Assets Held-for-use | $ 0 | 0 | |
Minimum | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Useful Life (years) | 5 years | ||
Maximum | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Useful Life (years) | 30 years | ||
Trade names | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Original Cost | $ 19.5 | 16.9 | |
Net Book Value | 19.5 | 16.9 | |
Customer contracts and relationships | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Original Cost | 413.6 | 422 | |
Accumulated Amortization | 128.8 | 129.1 | |
Net Book Value | $ 284.8 | 292.9 | |
Customer contracts and relationships | Minimum | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Useful Life (years) | 10 years | ||
Customer contracts and relationships | Maximum | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Useful Life (years) | 30 years | ||
Covenants not to compete | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Useful Life (years) | 5 years | ||
Original Cost | $ 2.2 | 5.5 | |
Accumulated Amortization | 0.7 | 3.6 | |
Net Book Value | $ 1.5 | 1.9 | |
Developed Technologies | |||
Goodwill and Intangible Assets Disclosure [Line Items] | |||
Useful Life (years) | 15 years | ||
Original Cost | $ 3.3 | 3.3 | |
Accumulated Amortization | 0.5 | 0.2 | |
Net Book Value | $ 2.8 | $ 3.1 |
Goodwill and Long-Lived Asset41
Goodwill and Long-Lived Assets, Net (Goodwill and Amortization Expenses) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Goodwill and Intangible Assets | |||
Amortization expense of intangible assets | $ 19.3 | $ 19.6 | $ 23.7 |
Expected amortization expenses in year one | 19 | ||
Expected amortization expenses in year two | 19 | ||
Expected amortization expenses in year three | 19 | ||
Expected amortization expenses in year four | 19 | ||
Expected amortization expenses in year five | 19 | ||
Long-lived assets impairment | $ 0 | $ 0 | |
Accumulated goodwill impairment loss | $ 601.1 |
Goodwill and Long-lived Asset42
Goodwill and Long-lived Assets, Net (Changes in Carrying Amount of Goodwill) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Goodwill and Intangible Assets | |||
Goodwill, Balance | $ 996.4 | $ 954.9 | |
Acquisitions | 17.3 | 50.8 | |
Purchase price adjustments | (0.1) | (2.5) | |
Effect of foreign currency translation | 43.2 | (6.8) | |
Impairment | 0 | 0 | $ (310.4) |
Goodwill, Balance | $ 1,056.8 | $ 996.4 | $ 954.9 |
Related Party Transactions (Det
Related Party Transactions (Details) - Former parent - USD ($) $ in Millions | 2 Months Ended | 12 Months Ended | |
Apr. 12, 2017 | Jan. 31, 2017 | Jan. 31, 2016 | |
Cost incurred pursuant to arrangements | $ 8.7 | ||
Sales | $ 4.4 | $ 24.1 | $ 19 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Millions | Jan. 31, 2018 | Jan. 31, 2017 |
Accrued Liabilities | ||
Accrued salaries, vacation and related benefits | $ 37.2 | $ 31.6 |
Accrued commissions | 10.9 | 8.7 |
Income taxes payable | 10.7 | 10.3 |
Accrued interest | 11.7 | 11.7 |
Other accrued liabilities | 36.2 | 28.8 |
Total accrued liabilities | $ 106.7 | $ 91.1 |
Long-Term Debt (Details)
Long-Term Debt (Details) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2014USD ($) | Jan. 31, 2018USD ($)item | Jan. 31, 2017USD ($) | May 19, 2015USD ($) | Dec. 16, 2014USD ($) | |
Debt Instrument [Line Items] | |||||
Long-term debt | $ 1,184.6 | $ 1,182 | |||
Long term debt outstanding | 1,200 | ||||
Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Amount outstanding | 0 | 0 | |||
Revolving credit facility | $ 750 | $ 500 | |||
Current borrowing capacity | $ 744.2 | ||||
Number of maintenance financial covenants | item | 0 | ||||
Outstanding letter of credit amount | $ 5.8 | ||||
Senior Unsecured Notes 5.875 Percent Due 2022 | |||||
Debt Instrument [Line Items] | |||||
Senior unsecured notes | $ 1,200 | 1,200 | 1,200 | ||
Less unamortized original issue discount and debt issue costs | 15.4 | 18 | |||
Senior unsecured notes net of unamortized original issue discount and debt issue costs | $ 1,184.6 | $ 1,182 | |||
Debt, interest rate | 5.875% | 5.875% | |||
Long term debt outstanding | $ 1,200 | ||||
Proceeds from the issue of Notes | 1,172.1 | ||||
Amount distributed to former parent from the proceeds | 750 | ||||
Proceeds net of distribution to former parent | $ 422.1 |
Long-Term Debt - Maturities (De
Long-Term Debt - Maturities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Long-Term Debt | |||
2,023 | $ 1,200 | ||
Total | 1,200 | ||
Interest expense | $ 75.8 | $ 75.9 | $ 77.7 |
Commitments, Contingencies an47
Commitments, Contingencies and Off-Balance Sheet Arrangements (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Rent expense | $ 39.8 | $ 28.9 | $ 37.7 |
2,019 | 31.2 | ||
2,020 | 30.1 | ||
2,021 | 24.7 | ||
2,022 | 20.6 | ||
2,023 | 15 | ||
Thereafter | 68.5 | ||
Total | 190.1 | ||
Real Estate | |||
Total | $ 166 |
Commitments, Contingencies an48
Commitments, Contingencies and Off-Balance Sheet Arrangements - Commitments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Apr. 30, 2017 | Jan. 31, 2017 | |
Key Officer One | |||
Minimum contractual salary | $ 1 | ||
Initial term of employment agreements | 3 years | ||
Number of additional years for which employment agreements may renew | 1 year | ||
Annual contribution percentage, as a percent of base salary, to a tax-deferred compensation plan | 30.00% | 100.00% | |
Key Officer Two | |||
Minimum contractual salary | $ 0.7 | ||
Initial term of employment agreements | 3 years | ||
Number of additional years for which employment agreements may renew | 1 year | ||
Annual contribution percentage, as a percent of base salary, to a tax-deferred compensation plan | 100.00% |
Income Taxes - Components of Ea
Income Taxes - Components of Earnings Before Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Tax Indemnity Payable To Former Parent | $ 6.4 | ||
(Loss) earnings before income taxes | |||
United States | 128.3 | $ 41.3 | $ (624.4) |
Foreign | 12.2 | 12.2 | 10.3 |
Earnings (loss) before income taxes | 140.5 | $ 53.5 | $ (614.1) |
Other Current Liabilities | |||
Tax Indemnity Payable To Former Parent | 1.8 | ||
Other Long term Liabilities [Member] | |||
Tax Indemnity Payable To Former Parent | $ 4.6 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Current: | |||
Federal | $ (0.2) | $ 0.7 | |
State | 0.8 | $ 0.3 | (1.5) |
Foreign | 5.1 | (1.3) | 3.8 |
Total current income tax expense | 5.7 | (1) | 3 |
Deferred: | |||
Federal | 79.8 | 14.4 | (213.3) |
State | 2.9 | 1.3 | (17.4) |
Foreign | (1.3) | (9.4) | (0.6) |
Total deferred income tax expense (benefit) | 81.4 | 6.3 | (231.3) |
Total income tax (benefit) expense | $ 87.1 | $ 5.3 | $ (228.3) |
Income Taxes - Reconciliation (
Income Taxes - Reconciliation (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Jan. 31, 2018 | Dec. 31, 2017 | Jan. 31, 2017 | Jan. 31, 2016 | |
Income Taxes | ||||
Effective U.S. federal income tax rate | 33.80% | 35.00% | 35.00% | 35.00% |
Statutory federal income tax expense (benefit) | $ 47.5 | $ 18.7 | $ (214.9) | |
U.S. state income taxes | 3.4 | 1.5 | (17.5) | |
Foreign tax rate differential | (0.1) | 0.1 | (0.2) | |
Change in unrecognized tax benefits | 0.2 | (7.8) | 0.4 | |
Change in valuation allowance on foreign interest loss carryforwards | 6.3 | (1.6) | 5.3 | |
Other, net | 0.7 | 1.3 | 2 | |
Non-taxable/non-deductible items | (6) | (6.9) | (3.4) | |
Stock compensation | (7.2) | |||
Change in tax rate | 42.3 | |||
Total income tax (benefit) expense | $ 87.1 | $ 5.3 | $ (228.3) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Jan. 31, 2018 | Jan. 31, 2017 |
Deferred tax assets: | ||
Inventory reserves | $ 19.8 | $ 24.8 |
Accrued liabilities | 9.8 | 12.9 |
Intangible assets | 13.4 | 44.2 |
Net operating loss carryforward | 70.3 | 81.2 |
Inventory capitalization | 9.3 | 14.9 |
Other | 14.8 | 19.9 |
Gross deferred tax assets | 137.4 | 197.9 |
Deferred tax liabilities: | ||
Intangible assets | (13.7) | (12.8) |
Depreciation | (30.3) | (25.3) |
Deferred tax liabilities | (44) | (38.1) |
Net deferred tax asset (liability) before valuation allowance | 93.4 | 159.8 |
Valuation allowance | (24.8) | (17.8) |
Net deferred tax asset | $ 68.6 | $ 142 |
Income Taxes - Gross Uncertain
Income Taxes - Gross Uncertain Tax Positions Reconciliation (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Jan. 31, 2018 | Dec. 31, 2018 | Jan. 31, 2018 | Dec. 31, 2017 | Jan. 31, 2017 | Jan. 31, 2016 | Apr. 30, 2017 | |
Unrecognized tax benefit at beginning of period | $ 7.2 | $ 9 | $ 9.4 | ||||
Additions for current year tax positions | 0.1 | 4.6 | |||||
Additions for prior year tax positions | 1.3 | ||||||
Decreases for prior year tax positions | (7.6) | ||||||
Currency fluctuations | 1.1 | (0.1) | (0.4) | ||||
Unrecognized tax benefit at end of period | $ 8.4 | 8.4 | 7.2 | 9 | |||
Unrecognized tax benefits that would affect effective tax rate, if recognized | 5.6 | 5.6 | 4.4 | $ 9 | |||
Valuation allowance | 24.8 | 24.8 | 17.8 | ||||
Undistributed Earnings of Foreign Subsidiaries | 101 | 101 | |||||
Provision for undistributed earnings of foreign subsidiaries | 0 | ||||||
Long-term deferred tax asset | 74.5 | 74.5 | 147 | ||||
Accumulated deficit | (280) | $ (280) | $ (328) | ||||
Effective U.S. federal income tax rate | 33.80% | 35.00% | 35.00% | 35.00% | |||
Tax Cut and Jobs Act of 2017, Amount | 43.3 | ||||||
Forecast | |||||||
Effective U.S. federal income tax rate | 21.00% | ||||||
Domestic | |||||||
Operating loss carryforward | 157.4 | $ 157.4 | |||||
Foreign | |||||||
Operating loss carryforward | 117.8 | 117.8 | |||||
Valuation allowance | 95.2 | 95.2 | |||||
State and Local | |||||||
Operating loss carryforward | $ 134.6 | $ 134.6 | |||||
Accounting Standards Update 2016-09 | |||||||
Long-term deferred tax asset | $ 0.5 | ||||||
Accumulated deficit | 0.5 | ||||||
Early adoption | Accounting Standards Update 2016-16 | |||||||
Long-term deferred tax asset | 8.8 | ||||||
Long-term prepaid tax balance | $ (7.7) |
Employee Retirement Plans (Deta
Employee Retirement Plans (Details) - Savings and Investment Plan - USD ($) | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Employer matching percentage of employee contributions on first level of eligible compensation (as a percent) | 100.00% | ||
Percentage of eligible compensation, first level, matched by employer (as a percent) | 3.00% | ||
Employer match of employee contributions on the second level of eligible compensation (as a percent) | $ 50 | ||
Percentage of eligible compensation, second level, partially matched by employer (as a percent) | 2.00% | ||
Total expense for plans established pursuant to Section 401(k) | $ 4,300,000 | $ 3,400,000 | $ 3,600,000 |
Compensation expense | $ 2,300,000 | $ 2,500,000 | $ 2,400,000 |
Maximum | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Defined contribution savings and investment plan, employees contribution rate | 100.00% |
Stockholders' Equity - Computat
Stockholders' Equity - Computation of Basic and Diluted Net Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Stockholders' Equity | |||||||||||
Numerator: net (loss) earnings | $ (11.5) | $ 25.8 | $ 20.7 | $ 18.4 | $ 17.9 | $ 19.8 | $ 8 | $ 2.5 | $ 53.4 | $ 48.2 | $ (385.8) |
Weighted average common shares: | |||||||||||
Basic weighted average common shares (in millions) | 50.5 | 51.8 | 52.2 | ||||||||
Effect of dilutive securities - Dilutive securities (in millions) | 0.8 | 0.4 | |||||||||
Diluted weighted average common shares (in millions) | 51.3 | 52.2 | 52.2 | ||||||||
Basic net (loss) earnings per share: | |||||||||||
Basic net earnings per common share | $ (0.23) | $ 0.52 | $ 0.41 | $ 0.36 | $ 0.35 | $ 0.38 | $ 0.15 | $ 0.05 | $ 1.06 | $ 0.93 | $ (7.39) |
Diluted net (loss) earnings per share: | |||||||||||
Diluted net earnings per common share | $ (0.23) | $ 0.51 | $ 0.40 | $ 0.36 | $ 0.34 | $ 0.38 | $ 0.15 | $ 0.05 | $ 1.04 | $ 0.92 | $ (7.39) |
Stockholders' Equity - Long-Ter
Stockholders' Equity - Long-Term Incentive Plan (Details) $ in Millions | Dec. 16, 2014 | Jan. 31, 2018USD ($)shares | Jan. 31, 2017USD ($)shares | Jan. 31, 2016USD ($)shares |
Stockholders Equity Note [Line Items] | ||||
Anti-dilutive securities excluded from determination of diluted earnings per common share | 0 | 0 | 0 | |
Unvested shares, distribution date conversion ratio | 1.8139 | |||
Restricted Stock | ||||
Stockholders Equity Note [Line Items] | ||||
Share based compensation | $ | $ 22.2 | $ 15.6 | $ 11.4 | |
Unrecognized compensation cost | $ | $ 37.5 | |||
Restricted stock units granted | 207,100 | 262,300 | ||
Restricted stock units forfeited | 72,200 | 76,600 | ||
Outstanding restricted stock units | 611,200 | 766,400 | 827,200 | |
Restricted Stock | Minimum | ||||
Stockholders Equity Note [Line Items] | ||||
Restricted stock and restricted stock unit grants, vesting period | 3 years | |||
Restricted Stock | Maximum | ||||
Stockholders Equity Note [Line Items] | ||||
Restricted stock and restricted stock unit grants, vesting period | 4 years | |||
Restricted Stock Unit | ||||
Stockholders Equity Note [Line Items] | ||||
Restricted stock units granted | 113,387 | |||
Restricted stock units forfeited | 1,814 | |||
Outstanding restricted stock units | 452,051 |
Stockholders' Equity - Restrict
Stockholders' Equity - Restricted Stock Activity (Details) - $ / shares | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Restricted Stock | |||
Shares | |||
Outstanding, beginning of period | 766,400 | 827,200 | |
Shares granted | 207,100 | 262,300 | |
Shares vested | (290,100) | (246,500) | |
Shares forfeited | (72,200) | (76,600) | |
Outstanding, end of period | 611,200 | 766,400 | 827,200 |
Weighted Average Grant Date Fair Value | |||
Outstanding, beginning of period | $ 38.57 | $ 36.40 | |
Shares granted | 57.65 | 41.97 | |
Shares vested | 39.75 | 35.72 | |
Shares forfeited | 38.24 | 35.96 | |
Outstanding, end of period | $ 44.52 | $ 38.57 | $ 36.40 |
Weighted Average Remaining Vesting Period | |||
Weighted Average Remaining Vesting Period | 1 year 11 months 23 days | 2 years 5 months 9 days | 3 years 1 month 13 days |
Restricted Stock Unit | |||
Shares | |||
Shares granted | 113,387 | ||
Shares forfeited | (1,814) | ||
Outstanding, end of period | 452,051 | ||
Weighted Average Remaining Vesting Period | |||
Weighted Average Remaining Vesting Period | 1 year 8 months 23 days |
Stockholders' Equity - Stock Op
Stockholders' Equity - Stock Option Activity (Details) - Options | 1 Months Ended | 12 Months Ended | ||
Jan. 31, 2015USD ($) | Jan. 31, 2018USD ($)$ / sharesitemshares | Jan. 31, 2017USD ($)$ / sharesshares | Jan. 31, 2016$ / sharesshares | |
Number of Shares | ||||
Unvested time-based stock options outstanding | 298,298 | |||
Outstanding, beginning of period | 894,899 | 894,899 | ||
Granted | ||||
Exercised | (894,899) | |||
Canceled | ||||
Outstanding, end of period | 894,899 | 894,899 | ||
Exercisable, end of period | 596,601 | |||
Weighted Average Exercise Price | ||||
Outstanding, beginning of period | $ / shares | $ 39.08 | $ 39.08 | ||
Granted | $ / shares | ||||
Exercised | $ / shares | 39.08 | |||
Canceled | $ / shares | ||||
Outstanding, end of period | $ / shares | 39.08 | $ 39.08 | ||
Exercisable, end of period | $ / shares | $ 39.08 | |||
Weighted Average Remaining Contractual Life (in years) | ||||
Outstanding | 0 years | 7 years 11 months 16 days | 8 years 11 months 16 days | |
Exercisable, end of period | 0 years | 7 years 11 months 16 days | ||
Aggregate Intrinsic Value | ||||
Outstanding | $ | $ 8,868,400 | |||
Exercisable, end of period | $ | 5,912,300 | |||
Vesting period | 3 years | |||
Vesting installments | item | 3 | |||
Expiration period | 10 years | |||
Share based compensation | $ | $ 3,900,000 | $ 3,400,000 | ||
Unrecognized stock-based compensation related to options | $ | $ 0 | $ 7,700,000 | ||
Compensation costs not yet recognized, weighted-average period of recognition | 0 years | 10 months 13 days |
Stockholders' Equity - Weighted
Stockholders' Equity - Weighted Average Assumptions (Details) - Options | 1 Months Ended |
Jan. 31, 2015$ / shares | |
Weighted Average Assumptions | |
Expected life (in years) | 6 years 6 months |
Volatility | 30.00% |
Risk free interest rate | 1.50% |
Weighted average fair value per option at date of grant | $ 12.99 |
Employee Stock Purchase Plan (D
Employee Stock Purchase Plan (Details) - Employee Stock Purchase Plan - $ / shares | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Common stock price (as percentage) | 85.00% | ||
Common stock issued to employees of the company | 40,000 | 51,000 | 50,000 |
Weighted average price per share (in dollars per share) | $ 49.14 | $ 31.09 | $ 30.62 |
Segment Reporting (Revenues and
Segment Reporting (Revenues and Other Financial Information by Business Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Revenues | $ 442.2 | $ 456.7 | $ 430.6 | $ 411.3 | $ 373.4 | $ 389 | $ 378.9 | $ 352.8 | $ 1,740.8 | $ 1,494.1 | $ 1,567.4 |
Operating earnings | 216.3 | 129.4 | (536.8) | ||||||||
Total assets | 3,790 | 3,698.3 | 3,790 | 3,698.3 | 3,691 | ||||||
Goodwill | 1,056.8 | 996.4 | 1,056.8 | 996.4 | 954.9 | ||||||
Capital expenditures | 84.9 | 35.5 | 130.5 | ||||||||
Depreciation and amortization | 66.1 | 66.9 | 75 | ||||||||
Aerospace Solutions Group | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Revenues | 1,420.2 | 1,340.9 | 1,312.5 | ||||||||
Operating earnings | 238.5 | 220.6 | 211.6 | ||||||||
Total assets | 3,495.8 | 3,471.4 | 3,495.8 | 3,471.4 | 3,422.8 | ||||||
Goodwill | 1,056.8 | 996.4 | 1,056.8 | 996.4 | 952.4 | ||||||
Capital expenditures | 27.7 | 11 | 30.4 | ||||||||
Depreciation and amortization | 31.8 | 30.4 | 28.1 | ||||||||
Energy Services Group | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Revenues | 320.6 | 153.2 | 254.9 | ||||||||
Operating earnings | (22.2) | (91.2) | (748.4) | ||||||||
Total assets | 294.2 | 226.9 | 294.2 | 226.9 | 268.2 | ||||||
Goodwill | 2.5 | ||||||||||
Capital expenditures | 57.2 | 24.5 | 100.1 | ||||||||
Depreciation and amortization | 34.3 | 36.5 | 46.9 | ||||||||
Corporate, Non-Segment | |||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||||||
Total assets | $ 263.6 | $ 378.2 | $ 263.6 | $ 378.2 | $ 559.5 |
Segment Reporting (Revenues a62
Segment Reporting (Revenues and Operating Earnings Based on Originating Location) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $ 442.2 | $ 456.7 | $ 430.6 | $ 411.3 | $ 373.4 | $ 389 | $ 378.9 | $ 352.8 | $ 1,740.8 | $ 1,494.1 | $ 1,567.4 |
Operating earnings | 216.3 | 129.4 | (536.8) | ||||||||
Identifiable assets | 3,790 | 3,698.3 | 3,790 | 3,698.3 | 3,691 | ||||||
Domestic | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 1,734.2 | 1,423.8 | 1,453.4 | ||||||||
Operating earnings | 198.8 | 109.3 | (561) | ||||||||
Identifiable assets | 3,260.7 | 3,214.1 | 3,260.7 | 3,214.1 | |||||||
Foreign | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 6.6 | 70.3 | 114 | ||||||||
Operating earnings | 17.5 | 20.1 | $ 24.2 | ||||||||
Identifiable assets | $ 529.3 | $ 484.2 | $ 529.3 | $ 484.2 |
Segment Reporting (Revenues by
Segment Reporting (Revenues by Geographic Area Based on Destination) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Segment Reporting, Asset Reconciling Item [Line Items] | |||||||||||
Revenues | $ 442.2 | $ 456.7 | $ 430.6 | $ 411.3 | $ 373.4 | $ 389 | $ 378.9 | $ 352.8 | $ 1,740.8 | $ 1,494.1 | $ 1,567.4 |
% of Revenues | 100.00% | 100.00% | 100.00% | ||||||||
U.S. | |||||||||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||||||||
Revenues | $ 1,090.4 | $ 865.6 | $ 955.3 | ||||||||
% of Revenues | 62.60% | 57.90% | 61.00% | ||||||||
Europe | |||||||||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||||||||
Revenues | $ 382.7 | $ 387.9 | $ 376.3 | ||||||||
% of Revenues | 22.00% | 26.00% | 24.00% | ||||||||
Asia, Pacific Rim, Middle East and other | |||||||||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||||||||
Revenues | $ 267.7 | $ 240.6 | $ 235.8 | ||||||||
% of Revenues | 15.40% | 16.10% | 15.00% | ||||||||
Foreign | |||||||||||
Segment Reporting, Asset Reconciling Item [Line Items] | |||||||||||
Revenues | $ 6.6 | $ 70.3 | $ 114 | ||||||||
Export revenues from United States to customers in foreign countries | $ 643.8 | $ 511.1 | $ 457.9 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Asset Impairment Charges [Abstract] | |||
Goodwill impairment charge | $ 0 | $ 0 | $ 310.4 |
Total asset impairment charges | 640.2 | ||
Energy Services Group | |||
Asset Impairment Charges [Abstract] | |||
Property and equipment impairment, net | 152 | ||
Goodwill impairment charge | 310.4 | ||
Intangible assets impairment | 177.8 | ||
Total asset impairment charges | 640.2 | ||
Assets, Fair Value Disclosure [Abstract] | |||
Property and equipment fair value, net | 174.3 | ||
Total fair value | $ 174.3 | ||
Senior Unsecured Notes 5.875 Percent Due 2022 | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt, interest rate | 5.875% | 5.875% | |
Revolving Credit Facility | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Amount outstanding | $ 0 | $ 0 | |
Fair Value, Inputs, Level 2 | Senior Unsecured Notes | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Senior unsecured notes, fair value | $ 1,251 | $ 1,260.7 |
Selected Quarterly Data (Unau65
Selected Quarterly Data (Unaudited) (Summarized Data) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Jan. 31, 2018 | Oct. 31, 2017 | Jul. 31, 2017 | Apr. 30, 2017 | Jan. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 | Apr. 30, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | Jan. 31, 2015 | |
Selected Quarterly Data (Unaudited) | ||||||||||||
Accounts Receivable - trade | $ 316.1 | $ 261.3 | $ 316.1 | $ 261.3 | ||||||||
Inventories, net | 1,407.9 | 1,381.4 | 1,407.9 | 1,381.4 | ||||||||
Stockholders' equity | 2,269.9 | 2,221.1 | 2,269.9 | 2,221.1 | $ 2,202.5 | $ 2,601.1 | ||||||
Revenues | 442.2 | $ 456.7 | $ 430.6 | $ 411.3 | 373.4 | $ 389 | $ 378.9 | $ 352.8 | 1,740.8 | 1,494.1 | 1,567.4 | |
Cost of sales | 321.7 | 331.7 | 312 | 298.4 | 281.4 | 289 | 286.4 | 269.3 | 1,263.8 | 1,126.1 | 1,202.4 | |
Net earnings (loss) | $ (11.5) | $ 25.8 | $ 20.7 | $ 18.4 | $ 17.9 | $ 19.8 | $ 8 | $ 2.5 | $ 53.4 | $ 48.2 | $ (385.8) | |
Basic net earnings per share | $ (0.23) | $ 0.52 | $ 0.41 | $ 0.36 | $ 0.35 | $ 0.38 | $ 0.15 | $ 0.05 | $ 1.06 | $ 0.93 | $ (7.39) | |
Diluted net earnings per share | $ (0.23) | $ 0.51 | $ 0.40 | $ 0.36 | $ 0.34 | $ 0.38 | $ 0.15 | $ 0.05 | $ 1.04 | $ 0.92 | $ (7.39) | |
Impairment charge | $ 640.2 | |||||||||||
Goodwill impairment charge | $ 0 | $ 0 | $ 310.4 |
Valuation and Qualifying Acco66
Valuation and Qualifying Accounts (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | |
Allowance for doubtful accounts | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance At Beginning Of Period | $ 13.5 | $ 11.3 | $ 8 |
Expenses | 3.9 | 4 | 4.1 |
Other | 0.3 | ||
Write- Offs/ Disposals | 5.7 | 1.8 | 0.8 |
Balance At End Of Period | 12 | 13.5 | 11.3 |
Reserve for obsolete inventories | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance At Beginning Of Period | 59.6 | 40.4 | 33.5 |
Expenses | 17.2 | 20.7 | 7.7 |
Write- Offs/ Disposals | 4.4 | 1.5 | 0.8 |
Balance At End Of Period | 72.4 | 59.6 | 40.4 |
Deferred tax asset valuation allowance | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance At Beginning Of Period | 17.8 | 21.9 | 24.8 |
Expenses | 0.7 | ||
Other | 6.3 | (1.6) | 5.3 |
Write- Offs/ Disposals | (2.5) | (8.2) | |
Balance At End Of Period | $ 24.8 | $ 17.8 | $ 21.9 |