KLX (KLXI) 10-Q 28 Aug 18 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jul. 31, 2018	Aug. 23, 2018
Document And Entity Information
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 31, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q2
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 Common Stock, Shares Outstanding		50,746,599

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Millions	Jul. 31, 2018	Jan. 31, 2018
Current assets:
Cash and cash equivalents	$ 322.7	$ 255.3
Accounts receivable-trade, less allowance for doubtful accounts ($12.0 at July 31, 2018 and January 31, 2018)	353.1	316.1
Inventories, net	1,418	1,407.9
Other current assets	46.9	51.7
Total current assets	2,140.7	2,031
Property and equipment, net of accumulated depreciation ($210.4 at July 31, 2018 and $191.1 at January 31, 2018)	310.2	286.4
Goodwill	1,038.4	1,056.8
Identifiable intangible assets, net	295.8	308.6
Deferred income taxes	55.3	74.5
Other assets	35.7	32.7
Total assets	3,876.1	3,790
Current liabilities:
Accounts payable	217.6	180.8
Accrued liabilities	103.4	106.7
Total current liabilities	321	287.5
Long-term debt	1,185.9	1,184.6
Deferred income taxes	5.5	5.9
Other non-current liabilities	44.1	42.1
Commitments, contingencies and off-balance sheet arrangements (Note 9)
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 July 31, 2018 and January 31, 2018	0.5	0.5
Additional paid-in capital	2,768.8	2,756.5
Treasury stock: 3.8 million shares as of July 31, 2018 and January 31, 2018	(183)	(182.7)
Accumulated deficit	(214.2)	(280)
Accumulated other comprehensive loss	(52.5)	(24.4)
Total stockholders' equity	2,319.6	2,269.9
Total liabilities and equity	$ 3,876.1	$ 3,790

CONDENSED CONSOLIDATED BALANCE3

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Millions	Jul. 31, 2018	Jan. 31, 2018
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
Accounts receivable - trade, allowance for doubtful accounts	$ 12	$ 12
Property and equipment, accumulated depreciation	$ 210.4	$ 191.1
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares outstanding	0	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	54,600,000
Treasury stock	3,800,000	3,800,000

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME (UNAUDITED) - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 31, 2018	Jul. 31, 2017	Jul. 31, 2018	Jul. 31, 2017
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME (UNAUDITED)
Product revenues	$ 409.3	$ 357.1	$ 797.4	$ 704.6
Service revenues	117.9	73.5	228.9	137.3
Total revenues	527.2	430.6	1,026.3	841.9
Cost of sales - products	291.8	248.3	569.5	490.8
Cost of sales - services	85.7	63.7	167.7	119.6
Total cost of sales	377.5	312	737.2	610.4
Selling, general and administrative	85.7	66.3	163.9	130.6
Operating earnings	64	52.3	125.2	100.9
Interest expense	18.9	19	37.8	38
Earnings before income taxes	45.1	33.3	87.4	62.9
Income tax expense	10.3	12.6	20.9	23.8
Net earnings	34.8	20.7	66.5	39.1
Other comprehensive (loss) income:
Foreign currency translation adjustment	(15.2)	30.5	(28.1)	35.3
Comprehensive income	$ 19.6	$ 51.2	$ 38.4	$ 74.4
Net earnings per share - basic	$ 0.69	$ 0.41	$ 1.33	$ 0.77
Net earnings per share - diluted	$ 0.68	$ 0.40	$ 1.30	$ 0.76
Weighted average common shares - basic	50.2	50.9	50.1	51
Weighted average common shares - diluted	51	51.7	51	51.7

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Millions	6 Months Ended
	Jul. 31, 2018	Jul. 31, 2017
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$ 66.5	$ 39.1
Adjustments to reconcile net earnings to net cash flows provided by operating activities:
Depreciation and amortization	38	33
Deferred income taxes	19.6	21
Non-cash compensation	10.3	13
Amortization of deferred financing fees	2.3	2.2
Provision for inventory reserve	6.7	9.1
Change in allowance for doubtful accounts and sales returns	(0.2)	4.8
Loss on disposal of property and equipment	0.5	0.5
Changes in operating assets and liabilities, net of effects from acquisitions:
Accounts receivable	(36.9)	(54.8)
Inventories	(16.8)	(25.6)
Other current and non-current assets		(13.7)
Accounts payable	37.9	19.4
Other current and non-current liabilities	0.3	5.3
Net cash flows provided by operating activities	128.2	53.3
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(52.7)	(32.6)
Acquisitions, net of cash acquired	(2.4)
Net cash flows used in investing activities	(55.1)	(32.6)
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchase of treasury stock and other	(0.2)	(29.6)
Cash proceeds from stock issuance	1.2	1
Net cash flows provided by (used in) financing activities	1	(28.6)
Effect of foreign exchange rate changes on cash and cash equivalents	(6.7)	6.4
Net increase (decrease) in cash and cash equivalents	67.4	(1.5)
Cash and cash equivalents, beginning of period	255.3	277.3
Cash and cash equivalents, end of period	322.7	275.8
Cash paid during period for:
Income taxes paid, net of refunds	3.3	0.1
Interest	36.2	36.2
Supplemental schedule of non-cash activities:
Accrued property additions	$ 6.6	$ 6.1

Description of Business and Bas

Description of Business and Basis of Presentation	6 Months Ended
	Jul. 31, 2018
Description of Business and Basis of Presentation
Description of Business and Basis of Presentation	Note 1. Description of Business and Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. All adjustments which, in the opinion of management, are considered necessary for a fair presentation of the results of operations for the periods shown are of a normal recurring nature and have been reflected in the condensed consolidated financial statements. The results of operations for the periods presented are not necessarily indicative of the results expected for the full fiscal year or for any future period. The information included in these condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes included in the KLX Inc. (the “Company” or “KLX”) Annual Report on Form 10-K (the “2017 Form 10-K”) for the fiscal year ended January 31, 2018 (“Fiscal 2017”). The preparation of 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. On April 30, 2018, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with The Boeing Company, a Delaware corporation (“Boeing”), and Kelly Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Boeing (“Merger Sub”), as amended by Amendment No. 1 thereto, dated June 1, 2018, pursuant to which Boeing has agreed to acquire the Aerospace Solutions Group (“ASG”) business of KLX. In addition, the Company announced its intention to spin-off its Energy Services Group (“ESG”) business (“KLX Energy Services”) to its stockholders. Upon the terms and subject to the conditions set forth in the Merger Agreement, at the closing, Merger Sub will merge with and into the Company, with the Company surviving as a direct or indirect wholly-owned subsidiary of Boeing (the “Merger”). At the effective time of the Merger (the “Effective Time”), each share of KLX common stock that is issued and outstanding immediately prior to the Effective Time (other than shares of KLX common stock (i) held by KLX as treasury stock, (ii) held, directly or indirectly, by Boeing or Merger Sub immediately prior to the Effective Time or (iii) that are outstanding immediately prior to the Effective Time and that are held by any person who is entitled to demand, and properly demands, appraisal of such shares pursuant to, and who complies in all respects with, Section 262 of the Delaware General Corporation Law) will be converted into the right to receive $63.00 per share in cash, without interest. As a result, KLX shareholders as of the record date of the spin-off who are shareholders of KLX at the Effective Time will have received the $63.00 per share as well as the shares in the business being spun off, KLX Energy Services. The respective boards of directors of KLX and Boeing have unanimously approved the Merger Agreement, and the board of directors of KLX has agreed to recommend that KLX’s stockholders adopt the Merger Agreement. KLX has agreed, subject to certain exceptions, not to directly or indirectly solicit competing alternative proposals and to terminate all existing discussions, negotiations and communications with respect to any alternative proposal. The completion of the Merger is subject to the satisfaction or waiver of customary closing conditions, including, among other things: (i) consummation of the ESG spin-off and (ii) applicable regulatory approvals (see Note 14 – Subsequent Events). On July 16, 2018, the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), in connection with the Company’s previously announced merger with a wholly owned subsidiary of Boeing, expired. The expiration of the waiting period under the HSR Act satisfies one of the conditions to the closing of the merger, which remains subject to other closing conditions in the Merger Agreement. KLX and Boeing have made customary representations and warranties in the Merger Agreement. The Merger Agreement also contains customary covenants and agreements, including covenants and agreements relating to (a) the conduct of KLX’s business between the date of the signing of the Merger Agreement and the consummation of the Merger and (b) the efforts of the parties to cause the Merger to be completed. The Merger Agreement provides that Boeing may be required to pay KLX a termination fee equal to $175.0 and that KLX may be required to pay Boeing a termination fee equal to up to $175.0 if the Merger Agreement is terminated by KLX or Boeing under certain circumstances described in the Merger Agreement.

Recent Accounting Pronouncement

Recent Accounting Pronouncements	6 Months Ended
	Jul. 31, 2018
Recent Accounting Pronouncements
Recent Accounting Pronouncements	Note 2. Recent Accounting Pronouncements In May 2017, the Financial Accounting Standards Board (“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 became effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual reporting periods. The adoption of ASU 2017-09 did not have a material impact on the Company’s condensed 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 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 condensed consolidated financial statements. In May 2014, the 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. The Company adopted the new standard and its related amendments (collectively known as 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 remain unchanged. The additional disclosures required by ASC Topic 606 have been included below and in Note 11. Except for the changes below, no material changes have been made to the Company's significant accounting policies disclosed in Note 1, Description of Business and Summary of Significant Accounting Policies, in its 2017 Form 10-K. Revenue from Contracts with Customers Revenue Recognition — Under ASC Topic 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue in the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Revenues from product sales are recognized when the customer obtains control of the Company’s product, which occurs at a point in time, typically upon delivery in accordance with 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 logistics services which include inventory management and replenishment, supply chain solutions such as third-party logistics programs, packaging and bar coding, parts kitting, quality assurance testing and inspection, purchasing assistance programs and electronic data interchange capability. The price of such services is generally included in the price of the products delivered to the customer, and revenues are recognized upon delivery of the product, at which point, the customer has obtained control of the Company’s product. The Company does not account for these service activities separate from the related part sales as the services are inputs required to fulfill part orders received from customers. Service revenues from oilfield services (product/service lines (“PSLs”)) are recorded over time throughout and for the duration of the service or rental period. Contracts in the Company’s ESG segment are pursuant to a master services agreement (“MSA”) combined with a completed field ticket or a work order, which sets forth the details of the specific transaction including pricing. Backlog is not a relevant measure for the Company’s ASG segment, given the long-term nature of its contracts with its customers. Few, if any, include minimum purchase requirements, annually or over the term of the agreement. The Company’s ESG segment operates under MSAs with its oil and gas customers, which set forth the terms and conditions for the provision of services and the rental of equipment. Rental tools and service contracts are typically based on a day rate with rates based on the type of equipment and competitive conditions. As a result, the Company does not record backlog.

Business Combinations

Business Combinations	6 Months Ended
	Jul. 31, 2018
Business Combinations
Business Combinations	Note 3. Business Combinations 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 the Company to offer its 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 FASB ASC 805, Business Combinations (“ASC 805”) and primarily consist of inventory, accounts receivable, goodwill and intangibles and accounts payable and other current liabilities. The acquisitions did not have a material impact on the condensed consolidated financial statements. The valuations of the acquired assets related to the product line acquisitions are not yet complete and, as such, the Company has not yet finalized its allocation of the purchase price for the acquisitions.

Inventories

Inventories	6 Months Ended
	Jul. 31, 2018
Inventories
Inventories	Note 4. Inventories Inventories, made up of finished goods, consist primarily 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. The Company reviews inventory quantities on hand and records a provision for excess and obsolete inventory based primarily on historical demand, estimated product demand to support contractual supply agreements with its customers and the age of the inventory, among other factors. Demand for the Company’s products can fluctuate from period to period depending on customer activity. In accordance with industry practice, inventories include amounts relating to long-term contracts with long production cycles, some of which are not expected to be realized within one year. In addition, the Company supports a substantial portion of the global fleet of aircraft in service, and in its capacity as a stocking distributor will acquire and hold inventories for aircraft maintenance at periodic intervals as mandated by the Federal Aviation Administration (“FAA”) or similar regulatory agencies. Based on historical experience, the support of the aftermarket activities with products such as those which the Company sells will necessitate holding inventory in excess of the amount required to support new build production activity contracts. Obsolescence has historically been immaterial for the Company due to the long life of an aircraft and nature of the products sold by the Company. Inventory with a limited shelf life is continually monitored and reserved for in advance of expiration. The annual provision for inventory with limited shelf life has historically been immaterial. Inventory reserves were approximately $76.2 and $72.4 as of July 31, 2018 and January 31, 2018, respectively.

Goodwill and Intangible Assets

Goodwill and Intangible Assets	6 Months Ended
	Jul. 31, 2018
Goodwill and Intangible Assets
Goodwill and Intangible Assets	Note 5. Goodwill and Intangible Assets The table below sets forth the intangible assets by major asset class, all of which were acquired through business purchase transactions: July 31, 2018 January 31, 2018 Useful Life Original Accumulated Net Book Original Accumulated Net Book (Years) Cost Amortization Value Cost Amortization Value Customer contracts and relationships - 30 $ 410.2 $ 136.7 $ 273.5 $ 413.6 $ 128.8 $ 284.8 Covenants not to compete 5 2.2 0.9 1.3 2.2 0.7 1.5 Developed technologies 15 3.3 0.6 2.7 3.3 0.5 2.8 Trade names Indefinite 18.3 - 18.3 19.5 - 19.5 $ 434.0 $ 138.2 $ 295.8 $ 438.6 $ 130.0 $ 308.6 Amortization expense associated with identifiable intangible assets was $4.9 and $4.8 for the three months ended July 31, 2018 and 2017, respectively, and $9.9 and $9.6 for the six months ended July 31, 2018 and 2017, respectively. The Company currently expects to recognize amortization expense related to intangible assets of approximately $20.0 in each of the next five fiscal years (primarily related to our ASG business). The future amortization amounts are estimates. Actual future amortization expense may be different due to future acquisitions, impairments, changes in amortization periods or other factors such as changes in exchange rates for assets acquired outside the United States. The Company expenses costs to renew or extend the term of a recognized intangible asset. Goodwill decreased by $18.4 as compared to January 31, 2018 primarily as a result of foreign currency translation adjustments.

Accrued Liabilities

Accrued Liabilities	6 Months Ended
	Jul. 31, 2018
Accrued Liabilities
Accrued Liabilities	Note 6. Accrued Liabilities Accrued liabilities consisted of the following : July 31, January 31, 2018 2018 Accrued salaries, vacation and related benefits $ 37.7 $ 37.2 Accrued commissions 7.7 10.9 Income taxes payable 11.4 10.7 Accrued interest 11.8 11.7 Other accrued liabilities 34.8 36.2 $ 103.4 $ 106.7

Long-Term Debt

Long-Term Debt	6 Months Ended
	Jul. 31, 2018
Long-Term Debt
Long-Term Debt	Note 7. Long-Term Debt As of July 31, 2018, long-term debt consisted of $1,200.0 aggregate principal amount of the Company’s 5.875% senior unsecured notes due 2022 (the “5.875% Notes”). On a net basis, after taking into consideration the debt issue costs for the 5.875% Notes, total debt was $1,185.9. On June 8, 2018, the Company amended its amended and restated secured revolving credit facility, dated May 19, 2015 (as amended, the “Revolving Credit Facility”) to provide flexibility to spin off its ESG business. In addition, on June 8, 2018, the Company elected to reduce the total amount available to $650.0. As of July 31, 2018, the Company had $650.0 available for borrowing under the Revolving Credit Facility. Borrowings under the Revolving Credit Facility bear interest at an annual rate equal to the London interbank offered rate (“LIBOR”) (as defined in the Revolving Credit Facility) plus the applicable margin (as defined). No amounts were outstanding under the Revolving Credit Facility as of July 31, 2018 or January 31, 2018. The Revolving Credit Facility is tied to a borrowing base formula and has no maintenance financial covenants. This Revolving Credit Facility matures in May 2020, is collateralized by the Company’s assets and contains customary affirmative covenants, negative covenants, restrictions on the payment of dividends and the repurchase of its stock, and conditions precedent for borrowings, all of which were met as of July 31, 2018. Letters of credit issued under the Revolving Credit Facility aggregated $5.9 and $5.8 at July 31, 2018 and January 31, 2018, respectively.

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Jul. 31, 2018
Fair Value Measurements
Fair Value Measurements	Note 8. Fair Value Measurements All short-term financial instruments are generally 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 July 31, 2018. 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 $1,242.0 and $1,251.0 as of July 31, 2018 and January 31, 2018, respectively.

Commitments, Contingencies and

Commitments, Contingencies and Off-Balance Sheet Arrangements	6 Months Ended
	Jul. 31, 2018
Commitments, Contingencies and Off-Balance Sheet Arrangements
Commitments, Contingencies and Off-Balance Sheet Arrangements	Note 9. 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 condensed consolidated balance sheets. At July 31, 2018, future minimum lease payments under these arrangements approximated $191.8, the majority of which related to long-term real estate leases. Future payments under operating leases with terms greater than one year as of July 31, 2018 are as follows: Year Ending January 31, 2019 $ 17.5 2020 34.3 2021 28.4 2022 22.1 2023 16.4 Thereafter 73.1 Total $ 191.8 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 condensed consolidated financial statements. Following KLX’s announcement of the merger, on July 2, 2018, KLX received a demand letter from counsel for a purported KLX stockholder seeking inspection of KLX’s books and records. After negotiation with counsel for this purported stockholder and pursuant to an agreement governing the confidentiality of any produced documents, KLX produced certain books and records in connection with the proposed merger between KLX and Boeing. On July 6, 2018, a putative class action (the “Complaint”) was filed by a purported KLX stockholder in the United States District Court for the District of Delaware. The Complaint purports to bring the litigation as a class action on behalf of the public stockholders of KLX (the “Action”). The Complaint names as defendants the members of the board of directors of KLX and KLX. The Complaint alleges that KLX and the board of directors of KLX failed to disclose material information in KLX’s First Amended Preliminary Proxy Statement on Form 14A filed on June 28, 2018. The Complaint seeks, among other things, equitable relief, including to enjoin the closing of the merger, to direct disclosure of all material information in KLX’s proxy statement and to award plaintiff’s costs, including attorney’s and expert’s fees. On August 15, 2018, the parties to the Action entered into a confidential Memorandum of Understanding (the "Memorandum of Understanding") providing for the dismissal of the Action with prejudice as to the plaintiff in the Action and without prejudice as to the putative class. While KLX believes that the Action lacks merit and that the disclosures in the definitive proxy statement comply fully with applicable law, in order to avoid the expense and distraction of litigation, KLX agreed, pursuant to the terms of the confidential Memorandum of Understanding, to supplement the definitive proxy statement with certain supplemental disclosures, which it did on August 15, 2018. The confidential Memorandum of Understanding also outlined the terms of the plaintiff in the Action’s agreement in principle to dismiss the Complaint and release all claims which it has, has ever had, or could have asserted related to the Merger and disclosures related to the Merger. On August 22, 2018, the plaintiff filed a stipulation of dismissal. The counsel for the plaintiff has reserved the right to seek a mootness fee but has not yet made any specific demand for such a fee. In the opinion of management, neither the demand letter, nor the Complaint are likely to result in a material adverse effect on the Company’s condensed consolidated 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 condensed consolidated financial statements. Accordingly, no significant amounts have been accrued for indemnities, commitments and guarantees. The Company has employment agreements with certain key members of management with three-year initial terms and which renew for one additional year on each anniversary date. 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.

Accounting for Stock-Based Comp

Accounting for Stock-Based Compensation	6 Months Ended
	Jul. 31, 2018
Accounting for Stock-Based Compensation
Accounting for Stock-Based Compensation	Note 10. Accounting for Stock-Based Compensation The Company has a Long-Term Incentive Plan (“LTIP”) under which the Company’s Compensation Committee has the authority to grant stock options, stock appreciation rights, restricted stock, restricted stock units or other forms of equity-based or equity-related awards. The Company accounts for share-based compensation arrangements in accordance with the provisions of FASB ASC 718, Compensation—Stock Compensation , 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. Compensation cost related to KLX restricted stock and stock options was $4.9 and $6.9 for the three months ended July 31, 2018 and 2017, respectively, and $9.8 and $12.6 for the six months ended July 31, 2018 and 2017, respectively. Unrecognized compensation expense related to these grants was $28.8 at July 31, 2018. The Company will recognize a charge equal to the then unrecognized compensation cost of the grants resulting from the acceleration of shares under the LTIP upon the closing of the sale to Boeing. KLX has established a qualified Employee Stock Purchase Plan (“ESPP”), 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. 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. Compensation cost was $0.1 and $0.1 for the three months ended July 31, 2018 and 2017, respectively, and $0.2 and $0.2 for the six months ended July 31, 2018 and 2017, respectively. Further option periods after the completion of the option period ending June 30, 2018 under the ESPP were suspended pursuant to the Merger Agreement. If the Merger is completed, the ESPP will be terminated.

Segment Reporting

Segment Reporting	6 Months Ended
	Jul. 31, 2018
Segment Reporting
Segment Reporting	Note 11. 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. The segments regularly report their results of operations and make requests for capital expenditures and acquisition funding to the Company’s chief operational decision-making group (“CODM”). This group is comprised of the Chairman and Chief Executive Officer and the President and Chief Operating Officer. As a result, the CODM has determined the Company has two reportable segments. 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 operating earnings (losses) by reportable segment: THREE MONTHS ENDED SIX MONTHS ENDED JULY 31, JULY 31, JULY 31, JULY 31, Revenues 2018 2017 2018 2017 Aerospace Solutions Group $ 409.3 $ 357.1 $ 797.4 $ 704.6 Energy Services Group 117.9 73.5 228.9 137.3 Total revenues 527.2 430.6 1,026.3 841.9 Operating earnings (loss) (1)(2) Aerospace Solutions Group 51.8 60.1 106.5 118.8 Energy Services Group 12.2 (7.8) 18.7 (17.9) Total operating earnings 64.0 52.3 125.2 100.9 Interest expense 18.9 19.0 37.8 38.0 Earnings before income taxes $ 45.1 $ 33.3 $ 87.4 $ 62.9 (1) Operating earnings (loss) include an allocation of employee benefits and general and administrative costs primarily based on the proportion of each segment’s number of employees for the three and six months ended July 31, 2018 and 2017. (2) Costs related to the spin-off and costs associated with the sale of the business to Boeing have been allocated entirely to ESG and ASG, respectively during the three and six months ended July 31, 2018. The following table presents capital expenditures by reportable segment: THREE MONTHS ENDED SIX MONTHS ENDED JULY 31, JULY 31, JULY 31, JULY 31, 2018 2017 2018 2017 Aerospace Solutions Group $ 7.1 $ 2.6 $ 17.4 $ 5.3 Energy Services Group 18.6 15.5 35.3 27.3 $ 25.7 $ 18.1 $ 52.7 $ 32.6 Corporate capital expenditures have been allocated to the above segments based on each segment’s percentage of total capital expenditures. Goodwill was $1,038.4 and $1,056.8 as of July 31, 2018 and January 31, 2018, respectively, and is all related to ASG. The following table presents total assets by reportable segment: July 31, January 31, 2018 2018 Aerospace Solutions Group $ 3,543.5 $ 3,495.8 Energy Services Group 332.6 294.2 $ 3,876.1 $ 3,790.0 Corporate assets (primarily cash and cash equivalents) of $319.6 and $263.6 at July 31, 2018 and January 31, 2018, respectively, have been allocated to the above segments based on each segment’s percentage of total assets. 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. The following table presents revenues by reportable segment based on the originating location for the three and six months ended July 31, 2018. THREE MONTHS ENDED SIX MONTHS ENDED JULY 31, 2018 JULY 31, 2018 Aerospace Solutions Group Energy Services Group Aerospace Solutions Group Energy Services Group Revenues: Domestic $ 407.6 $ 117.9 $ 793.7 $ 228.9 Foreign 1.7 — 3.7 — $ 409.3 $ 117.9 $ 797.4 $ 228.9 Segment revenues by geographic area, based on destination, for the three and six months ended July 31, 2018 were as follows: Three Months Ended July 31, 2018 Aerospace Solutions Group Energy Services Group Revenues % of Revenues Revenues % of Revenues United States $ 221.2 54.0 % $ 117.9 100.0 % Europe 109.1 26.7 % — — % Asia, Pacific Rim, Middle East and other 79.0 19.3 % — — % Total revenues $ 409.3 100.0 % $ 117.9 100.0 % Six Months Ended July 31, 2018 Aerospace Solutions Group Energy Services Group Revenues % of Revenues Revenues % of Revenues United States $ 438.8 55.0 % $ 228.9 100.0 % Europe 207.8 26.1 % — — % Asia, Pacific Rim, Middle East and other 150.8 18.9 % — — % Total revenues $ 797.4 100.0 % $ 228.9 100.0 %

Net Earnings Per Common Share

Net Earnings Per Common Share	6 Months Ended
	Jul. 31, 2018
Net Earnings Per Common Share
Net Earnings Per Common Share	Note 12. Net Earnings Per Common Share Basic net earnings per common share is computed using the weighted average common shares outstanding during the period. Diluted net earnings per common share is computed by using the weighted average common shares outstanding including the dilutive effect of stock options, shares issued under the KLX LTIP and restricted shares based on an average share price during the period. For the three and six months ended July 31, 2018 and 2017, no shares of the Company’s common stock were excluded from the determination of diluted earnings per common share because their effect would have been anti-dilutive. The computations of basic and diluted earnings per share for the three and six months ended July 31, 2018 and 2017 are as follows: THREE MONTHS ENDED SIX MONTHS ENDED JULY 31, JULY 31, JULY 31, JULY 31, 2018 2017 2018 2017 Net earnings $ 34.8 $ 20.7 $ 66.5 $ 39.1 (Shares in millions) Basic weighted average common shares 50.2 50.9 50.1 51.0 Effect of dilutive securities - dilutive securities 0.8 0.8 0.9 0.7 Diluted weighted average common shares 51.0 51.7 51.0 51.7 Basic net earnings per common share $ 0.69 $ 0.41 $ 1.33 $ 0.77 Diluted net earnings per common share $ 0.68 $ 0.40 $ 1.30 $ 0.76

Income Taxes

Income Taxes	6 Months Ended
	Jul. 31, 2018
Income Taxes
Income Taxes	Note 13. Income Taxes In accordance with FASB ASC 740, Income Taxes , the Company recognizes the tax benefit from an uncertain tax position 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. As of July 31, 2018 and 2017, the Company had $8.7 and $9.3, respectively, of uncertain tax positions, including accrued interest of $1.1 and $1.3 at July 31, 2018 and 2017, respectively, all of which would affect the Company’s effective tax rate if recognized. Pursuant to the terms of the Tax Sharing Agreement with our former parent, B/E Aerospace, the Company may be liable for income tax in certain foreign jurisdictions arising from the examination of tax years during which the Company was part of the B/E Group. The statute of limitations in these foreign jurisdictions is open for tax years 2007-2014. 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. No changes were made to the estimate as of July 31, 2018.

Subsequent Events

Subsequent Events	6 Months Ended
	Jul. 31, 2018
Subsequent Events
Subsequent Events	Note 14. Subsequent Events On August 24, 2018, the Company’s stockholders voted in favor of the proposal to adopt the previously announced Merger Agreement, at a special meeting of stockholders held on August 24, 2018. Under the terms of the Merger Agreement, KLX stockholders will have the right to receive, for each share of KLX common stock that they own immediately prior to the effective time of the merger, $63.00 in cash per share, without interest (the “Merger Consideration”). The Merger Consideration is in addition to, and separate from, the shares of KLX Energy Services that KLX stockholders as of the record date of the previously announced spin-off of KLX Energy Services will receive in the spin-off. The merger is subject to certain additional customary closing conditions, including receipt of regulatory approvals in certain jurisdictions. The merger is expected to close during the fourth calendar quarter of 2018. On August 24, 2018, the Company’s board of directors (the “Board”) approved the separation of its ESG business through a distribution of all of the shares of KLX Energy Services common stock on a pro rata basis to the holders of KLX’s common stock. For every one share of KLX common stock held, KLX’s shareholders will receive 0.4 shares of KLX Energy Services common stock. No fractional shares of KLX Energy Services will be issued. KLX Shareholders will receive cash in lieu of fractional shares. The Board has set a record date of September 3, 2018 and a distribution date of September 14, 2018. The distribution of KLX Energy Services common stock will complete the separation of KLX Energy Services from KLX. After the distribution, KLX Energy Services will be an independent, publicly-traded company, and KLX will not own any shares of KLX Energy Services common stock.

Description of Business and Sum

Description of Business and Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jul. 31, 2018
Summary of Significant Accounting Policies
Recent Accounting Pronouncements	In May 2017, the Financial Accounting Standards Board (“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 became effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual reporting periods. The adoption of ASU 2017-09 did not have a material impact on the Company’s condensed 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 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 condensed consolidated financial statements. In May 2014, the 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. The Company adopted the new standard and its related amendments (collectively known as 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 remain unchanged. The additional disclosures required by ASC Topic 606 have been included below and in Note 11. Except for the changes below, no material changes have been made to the Company's significant accounting policies disclosed in Note 1, Description of Business and Summary of Significant Accounting Policies, in its 2017 Form 10-K. Revenue from Contracts with Customers Revenue Recognition — Under ASC Topic 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration that the Company expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC Topic 606, the Company performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue in the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. Revenues from product sales are recognized when the customer obtains control of the Company’s product, which occurs at a point in time, typically upon delivery in accordance with 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 logistics services which include inventory management and replenishment, supply chain solutions such as third-party logistics programs, packaging and bar coding, parts kitting, quality assurance testing and inspection, purchasing assistance programs and electronic data interchange capability. The price of such services is generally included in the price of the products delivered to the customer, and revenues are recognized upon delivery of the product, at which point, the customer has obtained control of the Company’s product. The Company does not account for these service activities separate from the related part sales as the services are inputs required to fulfill part orders received from customers. Service revenues from oilfield services (product/service lines (“PSLs”)) are recorded over time throughout and for the duration of the service or rental period. Contracts in the Company’s ESG segment are pursuant to a master services agreement (“MSA”) combined with a completed field ticket or a work order, which sets forth the details of the specific transaction including pricing. Backlog is not a relevant measure for the Company’s ASG segment, given the long-term nature of its contracts with its customers. Few, if any, include minimum purchase requirements, annually or over the term of the agreement. The Company’s ESG segment operates under MSAs with its oil and gas customers, which set forth the terms and conditions for the provision of services and the rental of equipment. Rental tools and service contracts are typically based on a day rate with rates based on the type of equipment and competitive conditions. As a result, the Company does not record backlog.

Goodwill and Intangible Assets

Goodwill and Intangible Assets (Tables)	6 Months Ended
	Jul. 31, 2018
Goodwill and Intangible Assets
Intangible Assets by Major Asset Class	July 31, 2018 January 31, 2018 Useful Life Original Accumulated Net Book Original Accumulated Net Book (Years) Cost Amortization Value Cost Amortization Value Customer contracts and relationships - 30 $ 410.2 $ 136.7 $ 273.5 $ 413.6 $ 128.8 $ 284.8 Covenants not to compete 5 2.2 0.9 1.3 2.2 0.7 1.5 Developed technologies 15 3.3 0.6 2.7 3.3 0.5 2.8 Trade names Indefinite 18.3 - 18.3 19.5 - 19.5 $ 434.0 $ 138.2 $ 295.8 $ 438.6 $ 130.0 $ 308.6

Accrued Liabilities (Tables)

Accrued Liabilities (Tables)	6 Months Ended
	Jul. 31, 2018
Accrued Liabilities
Accrued Liabilities	July 31, January 31, 2018 2018 Accrued salaries, vacation and related benefits $ 37.7 $ 37.2 Accrued commissions 7.7 10.9 Income taxes payable 11.4 10.7 Accrued interest 11.8 11.7 Other accrued liabilities 34.8 36.2 $ 103.4 $ 106.7

Commitments, Contingencies An23

Commitments, Contingencies And Off-Balance-Sheet Arrangements (Tables)	6 Months Ended
	Jul. 31, 2018
Commitments, Contingencies and Off-Balance Sheet Arrangements
Future Payments under Operating Leases with Terms Greater Than One Year	Future payments under operating leases with terms greater than one year as of July 31, 2018 are as follows: Year Ending January 31, 2019 $ 17.5 2020 34.3 2021 28.4 2022 22.1 2023 16.4 Thereafter 73.1 Total $ 191.8

Segment Reporting (Tables)

Segment Reporting (Tables)	6 Months Ended
	Jul. 31, 2018
Segment Reporting
Revenues and Operating Earnings (Losses) Based on Originating Location	THREE MONTHS ENDED SIX MONTHS ENDED JULY 31, JULY 31, JULY 31, JULY 31, Revenues 2018 2017 2018 2017 Aerospace Solutions Group $ 409.3 $ 357.1 $ 797.4 $ 704.6 Energy Services Group 117.9 73.5 228.9 137.3 Total revenues 527.2 430.6 1,026.3 841.9 Operating earnings (loss) (1)(2) Aerospace Solutions Group 51.8 60.1 106.5 118.8 Energy Services Group 12.2 (7.8) 18.7 (17.9) Total operating earnings 64.0 52.3 125.2 100.9 Interest expense 18.9 19.0 37.8 38.0 Earnings before income taxes $ 45.1 $ 33.3 $ 87.4 $ 62.9 (1) Operating earnings (loss) include an allocation of employee benefits and general and administrative costs primarily based on the proportion of each segment’s number of employees for the three and six months ended July 31, 2018 and 2017. (2) Costs related to the spin-off and costs associated with the sale of the business to Boeing have been allocated entirely to ESG and ASG, respectively during the three and six months ended July 31, 2018.
Capital Expenditures by Reportable Segment	THREE MONTHS ENDED SIX MONTHS ENDED JULY 31, JULY 31, JULY 31, JULY 31, 2018 2017 2018 2017 Aerospace Solutions Group $ 7.1 $ 2.6 $ 17.4 $ 5.3 Energy Services Group 18.6 15.5 35.3 27.3 $ 25.7 $ 18.1 $ 52.7 $ 32.6
Total Assets by Reportable Segment	July 31, January 31, 2018 2018 Aerospace Solutions Group $ 3,543.5 $ 3,495.8 Energy Services Group 332.6 294.2 $ 3,876.1 $ 3,790.0
Revenues by Reportable Segment Based on Destination	THREE MONTHS ENDED SIX MONTHS ENDED JULY 31, 2018 JULY 31, 2018 Aerospace Solutions Group Energy Services Group Aerospace Solutions Group Energy Services Group Revenues: Domestic $ 407.6 $ 117.9 $ 793.7 $ 228.9 Foreign 1.7 — 3.7 — $ 409.3 $ 117.9 $ 797.4 $ 228.9
Revenues by Geographic Area Based on Destination	Three Months Ended July 31, 2018 Aerospace Solutions Group Energy Services Group Revenues % of Revenues Revenues % of Revenues United States $ 221.2 54.0 % $ 117.9 100.0 % Europe 109.1 26.7 % — — % Asia, Pacific Rim, Middle East and other 79.0 19.3 % — — % Total revenues $ 409.3 100.0 % $ 117.9 100.0 % Six Months Ended July 31, 2018 Aerospace Solutions Group Energy Services Group Revenues % of Revenues Revenues % of Revenues United States $ 438.8 55.0 % $ 228.9 100.0 % Europe 207.8 26.1 % — — % Asia, Pacific Rim, Middle East and other 150.8 18.9 % — — % Total revenues $ 797.4 100.0 % $ 228.9 100.0 %

Net Earnings Per Common Share (

Net Earnings Per Common Share (Tables)	6 Months Ended
	Jul. 31, 2018
Net Earnings Per Common Share
Computation of Basic and Diluted Net Earnings Per Share	THREE MONTHS ENDED SIX MONTHS ENDED JULY 31, JULY 31, JULY 31, JULY 31, 2018 2017 2018 2017 Net earnings $ 34.8 $ 20.7 $ 66.5 $ 39.1 (Shares in millions) Basic weighted average common shares 50.2 50.9 50.1 51.0 Effect of dilutive securities - dilutive securities 0.8 0.8 0.9 0.7 Diluted weighted average common shares 51.0 51.7 51.0 51.7 Basic net earnings per common share $ 0.69 $ 0.41 $ 1.33 $ 0.77 Diluted net earnings per common share $ 0.68 $ 0.40 $ 1.30 $ 0.76

Description of Business and B26

Description of Business and Basis of Presentation (Details) - USD ($) $ / shares in Units, $ in Millions	Jul. 16, 2018	Apr. 30, 2018
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Termination fee	$ 175
ASG | Disposal Group, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Transaction price per share		$ 63

Business Combinations (Details)

Business Combinations (Details) $ in Millions	3 Months Ended
	Jan. 31, 2018USD ($)item
Business Combination, Separately Recognized Transactions [Line Items]
Number of product lines acquired | item	2
Two Product Lines
Business Combination, Separately Recognized Transactions [Line Items]
Aggregate purchase price | $	$ 64.8

Inventories (Details)

Inventories (Details) - USD ($) $ in Millions	Jul. 31, 2018	Jan. 31, 2018
Inventories
Inventory reserves	$ 76.2	$ 72.4

Goodwill and Long-Lived Assets,

Goodwill and Long-Lived Assets, Net (Major Asset Classes) (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 31, 2018	Jan. 31, 2018
Goodwill and Intangible Assets Disclosure [Line Items]
Original Cost	$ 434	$ 438.6
Accumulated Amortization	138.2	130
Net Book Value	295.8	308.6
Trade names
Goodwill and Intangible Assets Disclosure [Line Items]
Original Cost	18.3	19.5
Net Book Value	18.3	19.5
Customer contracts and relationships
Goodwill and Intangible Assets Disclosure [Line Items]
Original Cost	410.2	413.6
Accumulated Amortization	136.7	128.8
Net Book Value	$ 273.5	284.8
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	2.2
Accumulated Amortization	0.9	0.7
Net Book Value	$ 1.3	1.5
Developed Technologies
Goodwill and Intangible Assets Disclosure [Line Items]
Useful Life (years)	15 years
Original Cost	$ 3.3	3.3
Accumulated Amortization	0.6	0.5
Net Book Value	$ 2.7	$ 2.8

Goodwill and Long-Lived Asset30

Goodwill and Long-Lived Assets, Net (Goodwill and Amortization Expenses) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 31, 2018	Jul. 31, 2017	Jul. 31, 2018	Jul. 31, 2017
Amortization expense of intangible assets	$ 4.9	$ 4.8	$ 9.9	$ 9.6
Expected amortization expenses in year one	20		20
Expected amortization expenses in year two	20		20
Expected amortization expenses in year three	20		20
Expected amortization expenses in year four	20		20
Expected amortization expenses in year five	$ 20		20
Aerospace Solutions Group
Goodwill decrease during period			$ 18.4

Accrued Liabilities (Details)

Accrued Liabilities (Details) - USD ($) $ in Millions	Jul. 31, 2018	Jan. 31, 2018
Accrued Liabilities
Accrued salaries, vacation and related benefits	$ 37.7	$ 37.2
Accrued commissions	7.7	10.9
Income taxes payable	11.4	10.7
Accrued interest	11.8	11.7
Other accrued liabilities	34.8	36.2
Total accrued liabilities	$ 103.4	$ 106.7

Long-Term Debt (Details)

Long-Term Debt (Details) $ in Millions	6 Months Ended
	Jul. 31, 2018USD ($)item	Jan. 31, 2018USD ($)
Debt Instrument [Line Items]
Long-term debt	$ 1,185.9	$ 1,184.6
Revolving Credit Facility
Debt Instrument [Line Items]
Amount outstanding	0	0
Revolving credit facility	$ 650
Number of maintenance financial covenants | item	0
Outstanding letter of credit amount	$ 5.9	$ 5.8
Senior Unsecured Notes 5.875 Percent Due 2022
Debt Instrument [Line Items]
Senior unsecured notes	$ 1,200
Debt, interest rate	5.875%
Long-term debt	$ 1,185.9

Fair Value Measurements (Detail

Fair Value Measurements (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 31, 2018	Jan. 31, 2018
Senior Unsecured Notes 5.875 Percent Due 2022
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt, interest rate	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 5.875 Percent Due 2022
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Senior unsecured notes, fair value	$ 1,242	$ 1,251

Commitments, Contingencies an34

Commitments, Contingencies and Off-Balance Sheet Arrangements (Details) $ in Millions	Jul. 31, 2018USD ($)
Commitments, Contingencies and Off-Balance Sheet Arrangements
2,019	$ 17.5
2,020	34.3
2,021	28.4
2,022	22.1
2,023	16.4
Thereafter	73.1
Total	$ 191.8

Commitments, Contingencies an35

Commitments, Contingencies and Off-Balance Sheet Arrangements - Commitments (Details)	6 Months Ended
	Jul. 31, 2018
Commitments, Contingencies and Off-Balance Sheet Arrangements
Initial term of employment agreements	3 years
Number of additional years for which employment agreements may renew	1 year

Accounting for Stock-Based Co36

Accounting for Stock-Based Compensation (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 31, 2018	Jul. 31, 2017	Jul. 31, 2018	Jul. 31, 2017
Accounting for Stock-Based Compensation
Share-based compensation	$ 4.9	$ 6.9	$ 9.8	$ 12.6
Unrecognized compensation cost	28.8		$ 28.8
Qualified employees purchase of stock at a price equal to percentage of closing price			85.00%
Compensation expense	$ 0.1	$ 0.1	$ 0.2	$ 0.2

Segment Reporting (Revenues and

Segment Reporting (Revenues and Operating Earnings (Losses) by Reportable Segment) (Details) $ in Millions	3 Months Ended			6 Months Ended
	Jul. 31, 2018USD ($)	Jul. 31, 2017USD ($)	Jul. 31, 2016USD ($)	Jul. 31, 2018USD ($)item	Jul. 31, 2017USD ($)
Reportable Segments [Abstract]
Number of reportable segments | item				2
Revenues
Revenues	$ 527.2	$ 430.6	$ 527.2	$ 1,026.3	$ 841.9
Operating earnings (loss)
Operating earnings (loss)	64	52.3	64	125.2	100.9
Interest expense	18.9	19	18.9	37.8	38
Earnings before income taxes	45.1	33.3	45.1	87.4	62.9
Aerospace Solutions Group
Revenues
Revenues	409.3	357.1	409.3	797.4	704.6
Operating earnings (loss)
Operating earnings (loss)		60.1	51.8	106.5	118.8
Energy Services Group
Revenues
Revenues	$ 117.9	73.5	117.9	228.9	137.3
Operating earnings (loss)
Operating earnings (loss)		$ (7.8)	$ 12.2	$ 18.7	$ (17.9)

Segment Reporting (Capital Expe

Segment Reporting (Capital Expenditures by Reportable Segment) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 31, 2018	Jul. 31, 2017	Jul. 31, 2018	Jul. 31, 2017
Property, Plant and Equipment [Line Items]
Capital expenditures	$ 25.7	$ 18.1	$ 52.7	$ 32.6
Aerospace Solutions Group
Property, Plant and Equipment [Line Items]
Capital expenditures	7.1	2.6	17.4	5.3
Energy Services Group
Property, Plant and Equipment [Line Items]
Capital expenditures	$ 18.6	$ 15.5	$ 35.3	$ 27.3

Segment Reporting (Goodwill by

Segment Reporting (Goodwill by Reportable Segment) (Details) - USD ($) $ in Millions	Jul. 31, 2018	Jan. 31, 2018
Goodwill [Line Items]
Goodwill	$ 1,038.4	$ 1,056.8
Aerospace Solutions Group
Goodwill [Line Items]
Goodwill	$ 1,038.4	$ 1,056.8

Segment Reporting (Total Assets

Segment Reporting (Total Assets by Reportable Segment) (Details) - USD ($) $ in Millions	Jul. 31, 2018	Jan. 31, 2018
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	$ 3,876.1	$ 3,790
Aerospace Solutions Group
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	3,543.5	3,495.8
Energy Services Group
Segment Reporting, Asset Reconciling Item [Line Items]
Total assets	$ 332.6	$ 294.2

Segment Reporting (Corporate As

Segment Reporting (Corporate Assets by Reportable Segment) (Details) - USD ($) $ in Millions	Jul. 31, 2018	Jan. 31, 2018
Segment Reporting Information [Line Items]
Total assets	$ 3,876.1	$ 3,790
Corporate, Non-Segment
Segment Reporting Information [Line Items]
Total assets	$ 319.6	$ 263.6

Segment Reporting (Revenues a42

Segment Reporting (Revenues and Operating Earnings Based on Originating Location) (Details) - USD ($) $ in Millions	3 Months Ended			6 Months Ended
	Jul. 31, 2018	Jul. 31, 2017	Jul. 31, 2016	Jul. 31, 2018	Jul. 31, 2017
Segment Reporting Information [Line Items]
Revenues	$ 527.2	$ 430.6	$ 527.2	$ 1,026.3	$ 841.9
Aerospace Solutions Group
Segment Reporting Information [Line Items]
Revenues	409.3	357.1	409.3	797.4	704.6
Aerospace Solutions Group | Domestic
Segment Reporting Information [Line Items]
Revenues	407.6			793.7
Aerospace Solutions Group | Foreign
Segment Reporting Information [Line Items]
Revenues	1.7			3.7
Energy Services Group
Segment Reporting Information [Line Items]
Revenues	117.9	$ 73.5	$ 117.9	228.9	$ 137.3
Energy Services Group | Domestic
Segment Reporting Information [Line Items]
Revenues	$ 117.9			$ 228.9

Segment Reporting (Revenues by

Segment Reporting (Revenues by Geographic Area Based on Destination) (Details) $ in Millions	3 Months Ended			6 Months Ended
	Jul. 31, 2018USD ($)item	Jul. 31, 2017USD ($)	Jul. 31, 2016USD ($)	Jul. 31, 2018USD ($)item	Jul. 31, 2017USD ($)
Segment Reporting, Asset Reconciling Item [Line Items]
Number of geographic regions | item	3			3
Revenues	$ 527.2	$ 430.6	$ 527.2	$ 1,026.3	$ 841.9
Aerospace Solutions Group
Segment Reporting, Asset Reconciling Item [Line Items]
Revenues	$ 409.3	357.1	409.3	$ 797.4	704.6
% of Revenues	100.00%			100.00%
Aerospace Solutions Group | U.S.
Segment Reporting, Asset Reconciling Item [Line Items]
Revenues	$ 221.2			$ 438.8
% of Revenues	54.00%			55.00%
Aerospace Solutions Group | Europe
Segment Reporting, Asset Reconciling Item [Line Items]
Revenues	$ 109.1			$ 207.8
% of Revenues	26.70%			26.10%
Aerospace Solutions Group | Asia, Pacific Rim, Middle East and other
Segment Reporting, Asset Reconciling Item [Line Items]
Revenues	$ 79			$ 150.8
% of Revenues	19.30%			18.90%
Energy Services Group
Segment Reporting, Asset Reconciling Item [Line Items]
Revenues	$ 117.9	$ 73.5	$ 117.9	$ 228.9	$ 137.3
% of Revenues	100.00%			100.00%
Energy Services Group | U.S.
Segment Reporting, Asset Reconciling Item [Line Items]
Revenues	$ 117.9			$ 228.9
% of Revenues	100.00%			100.00%

Net Earnings Per Common Share44

Net Earnings Per Common Share (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jul. 31, 2018	Jul. 31, 2017	Jul. 31, 2018	Jul. 31, 2017
Net Earnings Per Common Share
Anti-dilutive securities excluded from determination of diluted earnings per common share	0	0	0	0

Net Earnings Per Common Share45

Net Earnings Per Common Share (Computations of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 31, 2018	Jul. 31, 2017	Jul. 31, 2018	Jul. 31, 2017
Net Earnings Per Common Share
Net earnings	$ 34.8	$ 20.7	$ 66.5	$ 39.1
Basic weighted average common shares (in millions)	50.2	50.9	50.1	51
Effect of dilutive securities - dilutive securities	0.8	0.8	0.9	0.7
Diluted weighted average common shares (in millions)	51	51.7	51	51.7
Basic net earnings per common share	$ 0.69	$ 0.41	$ 1.33	$ 0.77
Diluted net earnings per common share	$ 0.68	$ 0.40	$ 1.30	$ 0.76

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	Jul. 31, 2018	Jul. 31, 2017
Income Taxes
Unrecognized tax benefits that would affect effective tax rate, if recognized	$ 8.7	$ 9.3
Liability for unrecognized tax benefits for interest and penalties	$ 1.1	$ 1.3

Subsequent Events (Details)

Subsequent Events (Details) - Disposal Group, Disposed of by Sale - ASG	Aug. 24, 2018$ / shares	Apr. 30, 2018$ / shares
Subsequent Event [Line Items]
Transaction price per share		$ 63
Subsequent Event
Subsequent Event [Line Items]
Transaction price per share	$ 63
Number of shares per common stock	0.4