Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | Apr. 24, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | GARDNER DENVER HOLDINGS, INC. | |
Entity Central Index Key | 1,699,150 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 198,104,494 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2018 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) [Abstract] | ||
Revenues | $ 619.6 | $ 481.7 |
Cost of sales | 387.7 | 307.1 |
Gross Profit | 231.9 | 174.6 |
Selling and administrative expenses | 106.9 | 102.3 |
Amortization of intangible assets | 30.9 | 27.6 |
Other operating expense, net | 4.3 | 7.9 |
Operating Income | 89.8 | 36.8 |
Interest expense | 26 | 45.9 |
Other income, net | (2) | (0.5) |
Income (Loss) Before Income Taxes | 65.8 | (8.6) |
Provision (benefit) for income taxes | 23.4 | (1.6) |
Net Income (Loss) | 42.4 | (7) |
Less: Net income attributable to noncontrolling interests | 0 | 0.1 |
Net Income (Loss) Attributable to Gardner Denver Holdings, Inc. | $ 42.4 | $ (7.1) |
Basic earnings (loss) per share (in dollars per share) | $ 0.21 | $ (0.05) |
Diluted earnings (loss) per share (in dollars per share) | $ 0.20 | $ (0.05) |
CONDENSED CONSOLIDATED STATEME3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Comprehensive Income Attributable to Gardner Denver Holdings, Inc. | |||
Net income (loss) attributable to Gardner Denver Holdings, Inc. | $ 42.4 | $ (7.1) | |
Other comprehensive income, net of tax: | |||
Foreign currency translation adjustments, net | 51.4 | 25.7 | |
Foreign currency losses, net | (17) | (3.9) | |
Unrecognized gains on cash flow hedges, net | 11.4 | 3 | |
Pension prior service cost and gain or loss, net | 0.4 | 0.2 | |
Total other comprehensive income, net of tax | [1] | 46.2 | 25 |
Comprehensive income attributable to Gardner Denver Holdings, Inc. | 88.6 | 17.9 | |
Comprehensive Income Attributable to Noncontrolling Interests | |||
Net income attributable to noncontrolling interests | 0 | 0.1 | |
Other comprehensive income, net of tax: | |||
Foreign currency translation adjustments, net | 0 | 0 | |
Total other comprehensive income, net of tax | 0 | 0 | |
Comprehensive income attributable to noncontrolling interests | 0 | 0.1 | |
Total Comprehensive Income | $ 88.6 | $ 18 | |
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 353.8 | $ 393.3 |
Accounts receivable, net of allowance for doubtful accounts of $19.5 and $18.7, respectively | 541.6 | 536.3 |
Inventories | 567.2 | 494.5 |
Other current assets | 50.8 | 39.5 |
Total current assets | 1,513.4 | 1,463.6 |
Property, plant and equipment, net of accumulated depreciation of $219.6 and $203.8, respectively | 365.3 | 363.2 |
Goodwill | 1,308.3 | 1,227.6 |
Other intangible assets, net | 1,449.2 | 1,431.2 |
Deferred tax assets | 1.1 | 1 |
Other assets | 138.1 | 134.6 |
Total assets | 4,775.4 | 4,621.2 |
Current liabilities: | ||
Short-term borrowings and current maturities of long-term debt | 21.1 | 20.9 |
Accounts payable | 284.6 | 269.7 |
Accrued liabilities | 305.4 | 271.2 |
Total current liabilities | 611.1 | 561.8 |
Long-term debt, less current maturities | 2,034 | 2,019.3 |
Pensions and other postretirement benefits | 100.2 | 99.8 |
Deferred income taxes | 248.3 | 237.5 |
Other liabilities | 214.1 | 226 |
Total liabilities | 3,207.7 | 3,144.4 |
Commitments and contingencies (Note 15) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value; 1,000,000,000 shares authorized; 199,434,219 and 198,377,237 shares issued at March 31, 2018 and December 31, 2017, respectively | 2 | 2 |
Capital in excess of par value | 2,282.3 | 2,275.4 |
Accumulated deficit | (535.7) | (577.8) |
Accumulated other comprehensive loss | (153.3) | (199.8) |
Treasury stock at cost; 2,208,106 and 2,159,266 shares at March 31, 2018 and December 31, 2017, respectively | (27.6) | (23) |
Total stockholders' equity | 1,567.7 | 1,476.8 |
Total liabilities and stockholders' equity | $ 4,775.4 | $ 4,621.2 |
CONDENSED CONSOLIDATED BALANCE5
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Accounts receivable, allowance for doubtful accounts | $ 19.5 | $ 18.7 |
Property, plant and equipment, accumulated depreciation | $ 219.6 | $ 203.8 |
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 199,434,219 | 198,377,237 |
Treasury stock (in shares) | 2,208,106 | 2,159,266 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) shares in Millions, $ in Millions | Common Stock [Member] | Capital in Excess of Par Value [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] | Treasury Stock [Member] | Total | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Cumulative-effect adjustment upon adoption of new accounting standard (ASU 2017-12) | ASU 2017-12 [Member] | $ (0.3) | $ 0.3 | [1] | ||||
Balance at beginning of period at Dec. 31, 2017 | $ 2 | $ 2,275.4 | (577.8) | (199.8) | $ (23) | $ 1,476.8 | |
Balance at beginning of period (in shares) at Dec. 31, 2017 | 198.4 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Stock-based compensation | 5.2 | ||||||
Exercise of stock options | $ 0 | 3.3 | |||||
Exercise of stock options (in shares) | 0.4 | ||||||
Purchases of treasury stock | (6.2) | ||||||
Issuance of common stock/treasury stock for stock-based compensation plans | $ 0 | (1.6) | 1.6 | ||||
Issuance of common stock for stock-based compensation plans (in shares) | 0.6 | ||||||
Net income (loss) | 42.4 | 42.4 | |||||
Foreign currency translation adjustments, net | 51.4 | 51.4 | |||||
Foreign currency losses, net | (17) | (17) | |||||
Unrecognized losses on cash flow hedges, net | 11.4 | 11.4 | |||||
Pension and other postretirement prior service cost and gain or loss, net | 0.4 | 0.4 | |||||
Balance at end of period at Mar. 31, 2018 | $ 2 | $ 2,282.3 | $ (535.7) | $ (153.3) | $ (27.6) | $ 1,567.7 | |
Balance at end of period (in shares) at Mar. 31, 2018 | 199.4 | ||||||
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Cash Flows From Operating Activities: | ||
Net income (loss) | $ 42.4 | $ (7) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Amortization of intangible assets | 30.9 | 27.6 |
Depreciation in cost of sales | 11.4 | 10.3 |
Depreciation in selling and administrative expenses | 2.7 | 1.8 |
Stock-based compensation expense | 3.4 | 0 |
Foreign currency transaction losses, net | 2.6 | 0.6 |
(Gains) losses on asset and business disposals | (1.2) | 3 |
Deferred income taxes | 2.8 | (6.2) |
Changes in assets and liabilities: | ||
Receivables | 10 | 11.1 |
Inventories | (42.9) | (15.4) |
Accounts payable | 8.4 | 3.2 |
Accrued liabilities | 2 | (20.6) |
Other assets and liabilities, net | (12.3) | (11) |
Net cash provided by (used in) operating activities | 60.2 | (2.6) |
Cash Flows From Investing Activities: | ||
Capital expenditures | (10.1) | (16.4) |
Net cash paid in business combinations | (94.9) | (0.3) |
Disposals of property, plant and equipment | 3 | 0.1 |
Net cash used in investing activities | (102) | (16.6) |
Cash Flows From Financing Activities: | ||
Principal payments on long-term debt | (5.3) | (6.1) |
Purchase of treasury stock | (6.2) | (2.5) |
Proceeds from stock option exercises | 3.3 | 0 |
Purchase of shares from noncontrolling interests | 0 | (4.6) |
Other | 0 | (0.1) |
Net cash used in financing activities | (8.2) | (13.3) |
Effect of exchange rate changes on cash and cash equivalents | 10.5 | 2.3 |
Net decrease in cash and cash equivalents | (39.5) | (30.2) |
Cash and cash equivalents, beginning of period | 393.3 | 255.8 |
Cash and cash equivalents, end of period | 353.8 | 225.6 |
Supplemental Cash Flow Information | ||
Cash paid for income taxes | 13.8 | 9.3 |
Cash paid for interest | 25.7 | 51.6 |
Capital expenditures in accounts payable | $ 6 | $ 5.2 |
Condensed Consolidated Financia
Condensed Consolidated Financial Statements | 3 Months Ended |
Mar. 31, 2018 | |
Condensed Consolidated Financial Statements [Abstract] | |
Condensed Consolidated Financial Statements | Note 1. Condensed Consolidated Financial Statements Basis of Presentation Gardner Denver Holdings, Inc. is a holding company whose operating subsidiaries are Gardner Denver, Inc. (“GDI”) and certain of GDI’s subsidiaries. GDI is a diversified, global manufacturer of highly engineered, application-critical flow control products and provider of related aftermarket parts and services. The accompanying condensed consolidated financial statements include the accounts of Gardner Denver Holdings, Inc. and its majority-owned subsidiaries (collectively referred to herein as “Gardner Denver” or the “Company”). The financial information presented as of any date other than December 31, 2017 has been prepared from the books and records of the Company without audit. The accompanying 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. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, the condensed consolidated financial statements include all adjustments, consisting of adjustments associated with acquisition accounting and normal recurring adjustments, necessary for the fair presentation of such financial statements. All intercompany transactions and accounts have been eliminated in consolidation. The Company’s unaudited interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, filed with the Securities and Exchange Commission (“SEC”). The results of operations for the three month period ended March 31, 2018 is not necessarily indicative of the results to be expected for the full year. The balance sheet as of December 31, 2017 has been derived from the Company’s audited financial statements as of that date but does not include all of the information and notes required by GAAP for complete financial statements. In May 2017, the Company sold a total of 47,495,000 shares of common stock in an initial public offering of shares of common stock. On November 15, 2017, the Company completed a secondary offering for a total of 25,300,000 shares of common stock held by affiliates of Kohlberg Kravis Roberts & Co. L.P. After completion of the initial public offering and the secondary offering, affiliates of Kohlberg Kravis Roberts & Co. L.P. continue to control a majority of the voting power of the Company’s common stock. As a result, the Company is considered a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange (“NYSE”). Prior Year Reclassification In the first quarter of fiscal year 2018, the Company adopted the provisions of ASU 2017-07, Compensation – Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net periodic Postretirement Benefit Cost Adopted Accounting Standard Updates” Adopted Accounting Standard Updates (“ASU”) ASU 2014-09, Revenue from Contracts with Customers (Topic 606) On January 1, 2018, the Company adopted Financial Accounting Standards Board (“FASB”) ASU 2014-09, Revenue from Contracts with Customers (Topic 606) In conjunction with adoption of ASC 606, the Company updated its significant accounting policy related to revenue recognition disclosed in Note 1 “Summary of Significant Accounting Policies” of the Consolidated Financial Statements in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2017. An overview of the Company’s revenue recognition policy under ASC 606 is included in Note 12 “Revenue from Contracts with Customers.” Results for the three month period ended March 31, 2018 is presented under ASC 606. Prior periods are not adjusted and will continue to be reported in accordance with ASC 605 Revenue Recognition The following tables summarize the impacts of adopting ASC 606 on the Company’s Condensed Consolidated Financial Statements for the three month period ended March 31, 2018. Condensed Consolidated Statements of Operations Balance Without As Reported Adjustments Adoption of ASC 606 Revenues $ 619.6 $ (3.9 ) $ 615.7 Cost of sales 387.7 (2.7 ) 385.0 Provision (benefit) for income taxes 23.4 (0.3 ) 23.1 Net Income (Loss) 42.4 (0.9 ) 41.5 Condensed Consolidated Balance Sheets Balance Without As Reported Adjustments Adoption of ASC 606 Assets Inventories $ 567.2 $ 2.7 $ 569.9 Other current assets (1) 50.8 (2.7 ) 48.1 Liabilities and Stockholders' Equity Accrued liabilities 305.4 0.9 306.3 Accumulated deficit (535.7 ) (0.9 ) (536.6 ) (1) Adjustment represents “Contract assets”. See Note 12 “Revenue from Contracts with Customers” for an explanation of the Contract assets account included in “Other Current assets” in the Condensed Consolidated Balance Sheets. ASU 2017-07 Compensation – Retirement Benefits (Topic 715) – Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost The Company adopted FASB ASU 2017-07 on January 1, 2018, the adoption date. The Company applied ASU 2017-07 retrospectively for the presentation of the service cost component and the other components of net periodic benefit cost in the income statement and prospectively for the capitalization of the service cost component of net periodic benefit cost in assets. ASU 2017-07 allows the Company to use the amounts disclosed in its pension and other postretirement benefit plan note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements. Applying the practical expedient, the Company reclassified $0.1 million of expense from “Selling and administrative expenses” to “Other income, net” within the Condensed Consolidated Statements of Operations for the three month period ended March 31, 2017. ASU 2017-12 Derivatives and Hedging (Topic 815) – Targeted Improvements to Accounting for Hedging Activities The Company early adopted FASB ASU 2017-12, Derivatives and Hedging (Topic 815) – Targeted Improvements to Accounting for Hedging Activities Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). In March 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) |
Business Combinations
Business Combinations | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Business Combinations | Note 2. Business Combinations Acquisition of Runtech Systems Oy On February 8, 2018, the Company acquired 100% of the stock of Runtech Systems Oy (“Runtech”), a leading global manufacturer of turbo vacuum technology systems and optimization solutions for industrial applications. The Company acquired all of the assets and assumed certain liabilities of Runtech for total cash consideration of $94.9 million, net of cash acquired. The revenues and operating income of Runtech are included in the Company’s consolidated financial statements from the acquisition date and are included in the Industrials segment. The preliminary purchase price allocation resulted in the recording of $63.6 million of goodwill and $31.3 million of amortizable intangible assets as of the acquisition date. None of the goodwill resulting from this acquisition is deductible for tax purposes. Acquisition of LeROI Compressors On June 5, 2017, the Company acquired 100% of the stock of LeROI Compressors (“LeROI”), a leading North America manufacturer of gas compression equipment and solutions for vapor recovery, biogas, and other process and industrials applications. The Company acquired all of the assets and assumed certain liabilities of LeROI for total cash consideration of $20.4 million, net of cash acquired. Included in the cash consideration is an indemnity holdback of $1.9 million recorded in “Accrued liabilities” and expected to be paid by the end of 2021. The revenues and operating income of LeROI are included in the Company’s condensed consolidated financial statements from the acquisition date and are included in the Industrials segment. None of the goodwill resulting from this acquisition is deductible for tax purposes. Acquisition of the Non-Controlling Interest in Tamrotor Kompressorit Oy On March 3, 2017, the Company acquired the remaining 49% non-controlling interest of Tamrotor Kompressorit Oy (“Tamrotor”), a distributor of the Company’s Industrials segment air compression products. The Company acquired the remaining interest in Tamrotor for total cash consideration of $5.2 million, consisting entirely of payments to the former shareholders. Included in the cash consideration was a holdback of $0.5 million that was paid in the third quarter of 2017. This transaction resulted in an increase to “Capital in excess of par value” of $2.3 million and an increase to “Accumulated other comprehensive loss” of $1.5 million in the Condensed Consolidated Balance Sheets. Acquisition Revenues and Operating Income Included in the financial statements for these acquisitions subsequent to their date of acquisition was revenue and operating income of $15.2 million and $0.4 million, respectively, for the three month period ended March 31, 2018. No revenue or operating income was recorded for these acquisitions in the Condensed Consolidated Statement of Operations for the three month period ended March 31, 2017. Pro forma information regarding these acquisitions have not been provided as they did not have a material impact on our consolidated results of operations individually or in the aggregate. |
Restructuring
Restructuring | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring [Abstract] | |
Restructuring | Note 3. Restructuring Industrials Restructuring Program The Industrials restructuring program in the Industrials segment, announced in the third quarter of 2014 and revised and expanded during the second quarter of 2016, was substantially completed as of December 31, 2017. Through December 31, 2017, $38.5 million had been charged to expense through “Other operating expense, net” in the Condensed Consolidated Statements of Operations. The Company does not anticipate any material future expense related to the Industrials restructuring program and any remaining liabilities will be paid as contractually obligated. Energy Restructuring Program The Energy restructuring program in the Energy segment, announced in the fourth quarter of 2016, was substantially completed as of December 31, 2017. Through December 31, 2017, $6.3 million had been charged to expense through “Other operating expense, net” in the Condensed Consolidated Statements of Operations. The Company does not anticipate any material future expense related to the Energy restructuring program and any remaining liabilities will be paid as contractually obligated. Medical Restructuring Program The Medical restructuring program in the Medical segment, announced in the fourth quarter of 2016, was substantially completed as of December 31, 2017. Through December 31, 2017, $3.2 million had been charged to expense through “Other operating expense, net” in the Condensed Consolidated Statements of Operations. The Company does not anticipate any material future expense related to the Medical restructuring program and any remaining liabilities will be paid as contractually obligated. The activity associated with the Company’s restructuring programs for the three month period ended March 31, 2018 was immaterial. The following table summarizes the activity associated with the Company’s restructuring programs by segment for the three month period ended March 31, 2017. Industrials Program Energy Program Medical Program Total Balance at December 31, 2016 $ 11.1 $ 5.6 $ 4.2 $ 20.9 Charged to expense - Termination benefits 0.6 (0.2 ) (0.1 ) 0.3 Charged to expense - Other 0.8 0.6 - 1.4 Payments (4.6 ) (2.1 ) (0.5 ) (7.2 ) Other, net 0.1 (0.1 ) 0.1 0.1 Balance at March 31, 2017 $ 8.0 $ 3.8 $ 3.7 $ 15.5 As of March 31, 2018, restructuring reserves of $4.1 million are included in “Accrued liabilities” and restructuring reserves of $0.2 million are included in “Other liabilities” in the Condensed Consolidated Balance Sheets. As of December 31, 2017, restructuring reserves of $6.5 million were included in “Accrued liabilities” and restructuring reserves of $0.2 million were included in “Other liabilities” in the Condensed Consolidated Balance Sheets. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2018 | |
Inventories [Abstract] | |
Inventories | Note 4. Inventories Inventories as of March 31, 2018 and December 31, 2017 consisted of the following. March 31, 2018 December 31, 2017 Raw materials, including parts and subassemblies $ 388.1 $ 362.6 Work-in-process 79.7 57.9 Finished goods 86.0 60.6 553.8 481.1 Excess of LIFO costs over FIFO costs 13.4 13.4 Inventories $ 567.2 $ 494.5 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill and Other Intangible Assets | Note 5. Goodwill and Other Intangible Assets The changes in the carrying amount of goodwill attributable to each reportable segment for the three month period ended March 31, 2018 is presented in the table below. Industrials Energy Medical Total Balance as of December 31, 2017 $ 561.6 $ 460.2 $ 205.8 $ 1,227.6 Acquisition 63.6 - - 63.6 Foreign currency translation 9.6 4.9 2.6 17.1 Balance as of March 31, 2018 $ 634.8 $ 465.1 $ 208.4 $ 1,308.3 On February 8, 2018, the Company acquired Runtech which is included in the Industrials segment. The excess of the purchase price over the estimated fair values of tangible assets, identifiable assets, and assumed liabilities was recorded as goodwill. As of March 31, 2018, the preliminary purchase price allocation resulted in a total of $63.6 million of goodwill. The allocation of the purchase price is preliminary and subject to refinement based on final fair values of the identified assets acquired and liabilities assumed. As of March 31, 2018, goodwill included $563.9 million of accumulated impairment losses within the Energy segment since the date of the transaction in which the Company was acquired by an affiliate of Kohlberg Kravis Roberts & Co. L.P. on July 30, 2013 (the “KKR Transaction”). There were no goodwill impairment charges recorded during the three month period ended March 31, 2018. Other intangible assets as of March 31, 2018 and December 31, 2017 consisted of the following. March 31, 2018 December 31, 2017 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Amortized intangible assets: Customer lists and relationships $ 1,248.7 $ (507.0 ) $ 1,226.8 $ (473.0 ) Technology 23.3 (4.3 ) 8.1 (4.0 ) Trademarks 38.4 (11.5 ) 30.3 (10.6 ) Backlog 70.5 (67.4 ) 65.5 (65.5 ) Other 55.3 (25.5 ) 53.6 (23.5 ) Unamortized intangible assets: Trademarks 628.7 - 623.5 - Total other intangible assets $ 2,064.9 $ (615.7 ) $ 2,007.8 $ (576.6 ) Amortization of intangible assets was $30.9 million for the three month period ended March 31, 2018 and $27.6 million for the three month period ended March 31, 2017. Amortization of intangible assets is anticipated to be approximately $125.1 million annually in 2019 through 2023 based upon exchange rates as of March 31, 2018. |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2018 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | Note 6. Accrued Liabilities Accrued liabilities as of March 31, 2018 and December 31, 2017 consisted of the following. March 31, 2018 December 31, 2017 Salaries, wages and related fringe benefits $ 86.4 $ 97.3 Restructuring 4.1 6.5 Taxes 48.2 34.5 Contract liabilities (1) 82.3 42.7 Product warranty 24.3 22.3 Accrued interest 0.9 0.8 Other 59.2 67.1 Total accrued liabilities $ 305.4 $ 271.2 (1) For purposes of comparability, “Advance payments on sales contracts” as of December 31, 2017 was reclassified to “Contract liabilities.” See Note 12 “Revenue from Contracts with Customers” for an explanation of the Contract liabilities account included in “Accrued liabilities” in the Condensed Consolidated Balance Sheets. A reconciliation of the changes in the accrued product warranty liability for the three month periods ended March 31, 2018 and 2017 are as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Balance at beginning of period $ 22.3 $ 21.7 Product warranty accruals 6.1 5.9 Settlements (5.4 ) (5.4 ) Charged to other accounts (1) 1.3 0.3 Balance at end of period $ 24.3 $ 22.5 (1) Includes primarily the effects of foreign currency translation adjustments for the Company’s subsidiaries with functional currencies other than the USD and changes in the accrual related to acquisitions. |
Pension and Other Postretiremen
Pension and Other Postretirement Benefits | 3 Months Ended |
Mar. 31, 2018 | |
Pension and Other Postretirement Benefits [Abstract] | |
Pension and Other Postretirement Benefits | Note 7. Pension and Other Postretirement Benefits The following table summarizes the components of net periodic benefit cost for the Company’s defined benefit pension plans and other postretirement benefit plans recognized for the three month periods ended March 31, 2018 and 2017. Pension Benefits Other Postretirement U.S. Plans Non-U.S. Plans Benefits For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2018 Service cost $ - $ 0.5 $ - Interest cost 0.5 1.9 - Expected return on plan assets (1.2 ) (3.0 ) - Recognition of: Unrecognized prior service cost - - - Unrecognized net actuarial loss - 0.5 - $ (0.7 ) $ (0.1 ) $ - Pension Benefits Other Postretirement U.S. Plans Non-U.S. Plans Benefits For the Three Month Period Ended March 31, 2017 For the Three Month Period Ended March 31, 2017 For the Three Month Period Ended March 31, 2017 Service cost $ - $ 0.4 $ - Interest cost 0.6 1.9 - Expected return on plan assets (1.1 ) (2.5 ) - Recognition of: Unrecognized prior service cost - - - Unrecognized net actuarial loss - 1.2 - $ (0.5 ) $ 1.0 $ - The components of net periodic benefit cost other than the service cost component are included in “Other income, net” in the Condensed Consolidated Statements of Operations. |
Debt
Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt [Abstract] | |
Debt | Note 8. Debt The Company’s debt as of March 31, 2018 and December 31, 2017 is summarized as follows. March 31, 2018 December 31, 2017 Short-term borrowings $ - $ - Long-term debt: Revolving credit facility, due 2020 $ - $ - Receivables financing agreement, due 2020 - - Term loan denominated in U.S. dollars, due 2024 (1) 1,279.1 1,282.3 Term loan denominated in Euros, due 2024 (2) 753.9 735.9 Capitalized leases and other long-term debt 26.7 26.9 Unamortized debt issuance costs (4.6 ) (4.9 ) 2,055.1 2,040.2 Current maturities of long-term debt 21.1 20.9 Total long-term debt, net $ 2,034.0 $ 2,019.3 (1) As of March 31, 2018, the applicable interest rate was 5.05% and the weighted-average interest rate was 4.46% for the three month period ended March 31, 2018. (2) As of March 31, 2018, the applicable interest rate was 3.00% and the weighted-average interest rate was 3.00% for the three month period ended March 31, 2018. Senior Secured Credit Facilities In connection with the KKR transaction, the Company entered into a senior secured credit agreement with UBS AG, Stamford Branch, as administrative agent, and other agents and lenders party thereto (the “Senior Secured Credit Facilities”) on July 30, 2013. The Senior Secured Credit Facilities entered into on July 30, 2013 provided senior secured financing in the equivalent of approximately $2,825.0 million, consisting of: (i) a senior secured term loan facility (the “Original Dollar Term Loan Facility”) in an aggregate principal amount of $1,900.0 million; (ii) a senior secured term loan facility (the “Original Euro Term Loan Facility,” together with the Dollar Term Loan Facility, the “Term Loan Facilities”) in an aggregate principal amount of €400.0 million; and (iii) a senior secured revolving credit facility (the “Revolving Credit Facility”) in an aggregate principal amount of $400.0 million available to be drawn in U.S. dollars (“USD”), Euros (“EUR”), Great British Pounds (“GBP”) and other reasonably acceptable foreign currencies, subject to certain sublimits for the foreign currencies. The Company entered into Amendment No. 1 to the Senior Secured Credit Facilities with UBS AG, Stamford Branch, as administrative agent, and the lenders and other parties thereto on March 4, 2016 (“Amendment No.1”) and Amendment No. 2 to the Senior Secured Credit Facilities with UBS AG, Stamford Branch, as administrative agent, and other agents, lenders and parties thereto on August 17, 2017 (“Amendment No. 2”). Amendment No. 1 reduced the aggregate principal borrowing capacity of the Revolving Credit Facility by $40.0 million to $360.0 million, extended the term of the Revolving Credit Facility to April 30, 2020 with respect to consenting lenders and provided for customary bail-in provisions to address certain European regulatory requirements. Amendment No. 2 refinanced the Original Dollar Term Loan Facility with a replacement $1,285.5 million senior secured U.S. dollar term loan facility (the ‘‘Dollar Term Loan Facility’’) and the Original Euro Term Loan Facility with a replacement €615.0 million senior secured euro term loan facility (the ‘‘Euro Term Loan Facility’’). Further the maturity for both term loan facilities was extended to July 30, 2024 and LIBOR Floor was reduced from 1.0% to 0.0%. On July 30, 2018, the Revolving Credit Facility principal amount will decrease to $269.9 million resulting from the maturity of the tranches of the Revolving Credit Facility which are owned by lenders which elected not to modify the original Revolving Credit Facility maturity date, and any amounts then outstanding in excess of $269.9 million will be required to be paid. Any principal amounts outstanding as of April 30, 2020 will be due at that time and required to be paid in full. The borrower of the Dollar Term Loan Facility and the Euro Term Loan Facility is Gardner Denver, Inc. Prior to the Company entering into Amendment No. 1, GD German Holdings II GmbH became an additional borrower and successor in interest to Gardner Denver Holdings GmbH & Co. KG. GD German Holdings II GmbH, GD First (UK) Limited and Gardner Denver, Inc. are the listed borrowers under the Revolving Credit Facility. The Revolving Credit Facility includes borrowing capacity available for letters of credit up to $200.0 million and for borrowings on same-day notice, referred to as swingline loans. As of March 31, 2018, the Company had $7.4 million of outstanding letters of credit under the Revolving Credit Facility and unused availability of $352.6 million. The Senior Secured Credit Facilities provide that the Company will have the right at any time to request incremental term loans and/or revolving commitments in an aggregate principal amount of up to (i) if as of the last day of the most recently ended test period the Consolidated Senior Secured Debt to Consolidated EBITDA Ratio (as defined in the Senior Secured Credit Facilities) is equal to or less than 5.50 to 1.00, $250.0 million plus (ii) voluntary prepayments and voluntary commitment reductions of the Senior Secured Credit Facilities prior to the date of any such incurrence plus (iii) an additional amount if, after giving effect to the incurrence of such additional amount, the Company does not exceed a Consolidated Senior Secured Debt to Consolidated EBITDA Ratio of 4.50 to 1.00. The lenders under the Senior Secured Credit Facilities are not under any obligation to provide any such incremental commitments or loans, and any such addition of, or increase in commitments or loans, will be subject to certain customary conditions. To the extent that revolving credit loans and swingline loans plus non-cash collateralized letters of credit under the Revolving Credit Facility are outstanding in an amount exceeding $300.0 million, compliance with a Consolidated Senior Secured Debt to Consolidated EBITDA Ratio of 7.00 to 1.00 is required for borrowings under the Revolving Credit Facility. Interest Rate and Fees Borrowings under the Dollar Term Loan Facility, the Euro Term Loan Facility and the Revolving Credit Facility bear interest at a rate equal to, at the Company’s option, either (a) the greater of LIBOR for the relevant interest period or 0.00% per annum, in each case adjusted for statutory reserve requirements, plus an applicable margin or (b) a base rate (the ‘‘Base Rate’’) equal to the highest of (1) the rate of interest publicly announced by the administrative agent as its prime rate in effect at its principal office in Stamford, Connecticut, (2) the federal funds effective rate plus 0.50% and (3) LIBOR for an interest period of one month, adjusted for statutory reserve requirements, plus 1.00%, in each case, plus an applicable margin. The applicable margin for (i) the Dollar Term Loan Facility is 2.75% for LIBOR loans and 1.75% for Base Rate loans, (ii) the Revolving Credit Facility is 2.75% for LIBOR loans and 1.75% for Base Rate loans and (iii) the Euro Term Loan is 3.00% for LIBOR loans. The applicable margins under the Revolving Credit Facility may decrease based upon our achievement of certain Consolidated Senior Secured Debt to Consolidated EBITDA Ratios. In addition to paying interest on outstanding principal under the Senior Secured Credit Facilities, the Company is required to pay a commitment fee of 0.50% per annum to the lenders under the Revolving Credit Facility in respect of the unutilized commitments thereunder. The commitment fee rate was reduced to 0.375% because our Consolidated Senior Secured Debt to Consolidated EBITDA Ratio is less than or equal to 3.0 to 1.0. The Company must also pay customary letter of credit fees. Prepayments The Senior Secured Credit Facilities require the Company to prepay outstanding term loans, subject to certain exceptions, with: (i) 50% of annual excess cash flow (as defined in the Senior Secured Credit Facilities) commencing with the fiscal year ended December 31, 2014 (which percentage will be reduced to 25% if the Company’s Secured Debt to Consolidated EBITDA Ratio (as defined in the Senior Secured Credit Facilities) is less than or equal to 3.50 to 1.00 but greater than 3.00 to 1.00, and which prepayment will not be required if the Secured Debt to Consolidated EBITDA Ratio is less than or equal to 3.00 to 1.00); (ii) 100% of the net cash proceeds of non-ordinary course asset sales or other dispositions of property, subject to reinvestment rights; and (iii) 100% of the net cash proceeds of any incurrence of debt, other than proceeds from debt permitted under the Senior Secured Credit Facilities. The foregoing mandatory prepayments will be applied to the scheduled installments of principal of the Term Loan Facilities in direct order of maturity. Subject to the following sentence, the Company may voluntarily repay outstanding loans under the Senior Secured Credit Facilities at any time without premium or penalty, subject to certain customary conditions, including reimbursements of the lenders’ redeployment costs actually incurred in the case of a prepayment of LIBOR borrowings other than on the last day of the relevant interest period. Voluntary prepayments of the Dollar Term Loan Facility and/or the Euro Term Loan Facility prior to the date that is six months after the effective date of Amendment No. 2 in connection with any repricing transaction, the primary purpose of which is to decrease the effective yield of the Dollar Term Loan Facility or the Euro Term Loan Facility, as applicable, will require payment of a 1.00% prepayment premium. Amortization and Final Maturity The Dollar Term Loan Facility amortizes in equal quarterly installments in aggregate annual amounts equal to 1.00% of the original principal amount of the Dollar Term Loan Facility, with the balance being payable on July 30, 2024. The Euro Term Loan Facility includes repayments in equal quarterly installments in aggregate annual amounts equal to 1.00% of the original principal amount of the Euro Term Loan Facility, with the balance being payable on July 30, 2024. Principal amounts outstanding under the Revolving Credit Facility are due and payable in full at maturity on July 30, 2018, in the case of portions held by non-consenting lenders, and April 30, 2020 with respect to all other borrowings thereunder. Amendment No. 1 reduced the minimum aggregate principal amount for extension amendments to the facilities from $50.0 million to $35.0 million. Guarantee and Security All obligations of the borrowers under the Senior Secured Credit Facilities are unconditionally guaranteed by the Company and all of its material, wholly-owned U.S. restricted subsidiaries, with customary exceptions including where providing such guarantees are not permitted by law, regulation or contract or would result in adverse tax consequences. All obligations of the borrowers under the Senior Secured Credit Facilities, and the guarantees of such obligations, are secured, subject to permitted liens and other exceptions, by substantially all of the assets of the borrowers and each guarantor, including but not limited to: (i) a perfected pledge of the capital stock issued by the borrowers and each subsidiary guarantor and (ii) perfected security interests in substantially all other tangible and intangible assets of the borrowers and the guarantors (subject to certain exceptions and exclusions). The obligations of the non-U.S. borrowers are secured by certain assets in jurisdictions outside of the United States. Certain Covenants and Events of Default The Senior Secured Credit Facilities contain a number of covenants that, among other things, restrict, subject to certain exceptions, the Company’s ability to: incur additional indebtedness and guarantee indebtedness; create or incur liens; engage in mergers or consolidations; sell, transfer or otherwise dispose of assets; create limitations on subsidiary distributions; pay dividends and distributions or repurchase its own capital stock; and make investments, loans or advances, prepayments of junior financings, or other restricted payments. In addition, certain restricted payments constituting dividends or distributions (subject to certain exceptions) are subject to compliance with a Consolidated Total Debt to Consolidated EBITDA Ratio (as defined in the Senior Secured Credit Facilities) of 5.00 to 1.00. Investments in unrestricted subsidiaries are permitted up to an aggregate amount that does not exceed the greater of $100.0 million and 25% of Consolidated EBITDA. The Revolving Credit Facility also requires the Company’s Consolidated Senior Secured Debt to Consolidated EBITDA Ratio to not exceed 7.50 to 1.00 for each fiscal quarter when outstanding revolving credit loans and swingline loans plus non-cash collateralized letters of credit under the Revolving Credit Facility (excluding (i) letters of credit in an aggregate amount not to exceed $80.0 million existing on the date of the closing of the Senior Secured Credit Facilities and any extensions thereof, replacement letters of credit or letters of credit issued in lieu thereof, in each case, to the extent the face amount of such letters of credit is not increased above the face amount of the letter of credit being extended, replaced or substituted and (ii) other non-cash collateralized letters of credit in an aggregate amount not to exceed $25.0 million, provided that the aggregate amount of non-cash collateralized letters of credit outstanding excluded pursuant to this provision shall not exceed $50.0 million) exceed $120.0 million. The Senior Secured Credit Facilities also contain certain customary affirmative covenants and events of default, including a change of control. Receivables Financing Agreement In May 2016, the Company entered into the Receivables Financing Agreement, providing for aggregated borrowing of up to $75.0 million governed by a borrowing base. The Receivables Financing Agreement provides for a lower cost alternative in the issuance of letters of credit with the remaining unused capacity providing additional liquidity. On June 30, 2017, the Company signed the first amendment of the Receivables Financing Agreement which increased the aggregated borrowing capacity by $50.0 million to $125.0 million governed by a borrowing base and extended the term to June 30, 2020. The Receivables Financing Agreement terminates on June 30, 2020, unless terminated earlier pursuant to its terms. As of March 31, 2018, the Company had no outstanding borrowings under the Receivables Financing Agreement and $33.3 million of letters of credit outstanding. As of March 31, 2018 there was $72.3 million of capacity available under the Receivables Financing Agreement. Borrowings under the Receivables Financing Agreement accrue interest at a reserve-adjusted LIBOR or a base rate, plus 1.6%. Letters of credit accrue interest at 1.6%. The Company may prepay borrowings or letters of credit or draw on the Receivables Financing Agreement upon one business day prior written notice and may terminate the Receivables Financing Agreement with 15 days’ prior written notice. As part of the Receivables Financing Agreement, eligible accounts receivable of certain of our subsidiaries are sold to a wholly owned “bankruptcy remote” special purpose vehicle (“SPV”). The SPV pledges the receivables as security for loans and letters of credit. The SPV is included in our consolidated financial statements and therefore, the accounts receivable owned by it are included in our Condensed Consolidated Balance Sheets. However, the accounts receivable owned by the SPV are separate and distinct from our other assets and are not available to our other creditors should we become insolvent. The Receivables Financing Agreement contains various customary representations and warranties and covenants, and default provisions which provide for the termination and acceleration of the commitments and loans under the agreement in circumstances including, but not limited to, failure to make payments when due, breach of representations, warranties or covenants, certain insolvency events or failure to maintain the security interest in the trade receivables, a change in control and defaults under other material indebtedness. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 3 Months Ended |
Mar. 31, 2018 | |
Stock-Based Compensation Plans [Abstract] | |
Stock-Based Compensation Plans | Note 9. Stock-Based Compensation Plans 2013 Stock Incentive Plan The Company adopted the 2013 Stock Incentive Plan (“2013 Plan”) on October 14, 2013 as amended on April 27, 2015 under which the Company may grant stock-based compensation awards to employees, directors and advisors. The total number of shares available for grant under the 2013 Plan and reserved for issuance was 20.9 million shares. All stock options were granted to employees, directors, and advisors with an exercise price equal to the fair value of the Company’s per share common stock at the date of grant. Following the Company’s initial public offering, the Company may grant stock-based compensation awards pursuant to the 2017 Plan (defined below) and ceased granting new awards pursuant to the 2013 Plan. Stock options awards under the 2013 Plan vest over either three, four or five years with 50% of each award vesting based on time and 50% of each award vesting based on the achievement of certain financial targets. Prior to the Company’s initial public offering in May 2017, the Company had certain repurchase rights on stock acquired through the exercise of a stock option that created an implicit service period and created a condition in which an optionee may not receive the economic benefits of the option until the repurchase rights are eliminated. The repurchase rights creating the implicit service period are eliminated at the earlier of an initial public offering or change of control event. Before the elimination of the repurchase rights, because an initial public offering or change of control were not probable of occurring, no compensation expense was recorded for equity awards. The Company recognized a liability for compensation expense measured at intrinsic value when it was probable that an employee would receive benefits under the terms of the plan due to termination of employment. Under the terms of the 2013 Plan, concurrent with the initial public offering, the Company no longer retains repurchase rights on stock acquired through the exercise of a stock option and the implicit service period was eliminated on outstanding stock options. 2017 Omnibus Incentive Plan In May 2017, the Company’s Board approved the 2017 Omnibus Incentive Plan (“2017 Plan”) under which the Company may grant stock-based compensation awards to employees, directors and advisors. All stock option awards were granted to employees, directors, and advisors with an exercise price equal to the fair value per share of the Company’s common stock at the date of grant. All restricted stock awards were granted to employees, directors, and advisors with a price equal to fair value per share of the Company’s common stock at the date of the grant. Stock options and restricted stock unit awards under the 2017 Plan generally vest over either four or five years based on time. Certain stock awards under the 2013 Plan are expected to be settled in cash (stock appreciation rights “SAR”) and are accounted for as liability awards. As of March 31, 2018, a liability of approximately $15.0 million for SARs is included in “Accrued liabilities” in the Condensed Consolidated Balance Sheets. Under the 2013 and 2017 Plans, the Company recognized stock-based compensation expense of approximately $3.4 million for the three months ended March 31, 2018. The $3.4 million of stock-based compensation includes The $3.8 million stock-based compensation for modifications for the three month period ended March 31, 2018 provided continued vesting through scheduled vesting dates and extended expiration dates for certain former employees. The incremental stock-based compensation was determined using the Black-Scholes option pricing model based on assumptions which included expected lives of 1.00 to 1.25 years, a risk-free interest rate of 2.03%, assumed volatility of 26.8% to 27.3% and an expected dividend rate of 0.0%. These costs are included in “Other operating expense, net” in the Condensed Consolidated Statements of Operations. As of March 31, 2018, there was $28.1 million of total unrecognized compensation expense related to outstanding stock options and restricted stock unit awards Stock Option Awards A summary of the Company’s stock option (including SARs) activity for the three month period ended March 31, 2018 is presented in the following table (underlying shares in thousands). Shares Weighted-Average Exercise Price (per share) Outstanding at December 31, 2017 12,834 $ 9.54 Granted 766 $ 32.06 Exercised or settled (391 ) $ 8.42 Forfeited (85 ) $ 8.43 Outstanding at March 31, 2018 13,124 $ 10.89 Vested at March 31, 2018 9,068 $ 9.07 The following assumptions were used to estimate the fair value of options granted (excluding previously disclosed modified awards) during the three month period ended March 31, 2018 using the Black-Scholes option-pricing model. Three Month Period Ended March 31, 2018 Assumptions: Expected life of options (in years) 7.00 - 7.50 Risk-free interest rate 2.9 % Assumed volatility 35.1 - 35.4 % Expected dividend rate 0.0 % Restricted Stock Unit Awards A summary of the Company’s restricted stock unit activity for the three month period ended March 31, 2018 is presented in the following table (underlying shares in thousands). Shares Weighted-Average Grant-Date Fair Value Non-vested at December 31, 2017 - $ - Granted 337 $ 32.06 Vested - $ - Forfeited - $ - Non-vested at March 31, 2018 337 $ 32.06 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 3 Months Ended |
Mar. 31, 2018 | |
Accumulated Other Comprehensive (Loss) Income [Abstract] | |
Accumulated Other Comprehensive (Loss) Income | Note 10. Accumulated Other Comprehensive (Loss) Income The Company’s other comprehensive (loss) income consists of (i) unrealized foreign currency net gains and losses on the translation of the assets and liabilities of its foreign operations; (ii) realized and unrealized foreign currency gains and losses on intercompany notes of a long-term nature and certain hedges of net investments in foreign operations, net of income taxes; (iii) unrealized gains and losses on cash flow hedges (consisting of interest rate swaps), net of income taxes; and (iv) pension and other postretirement prior service cost and actuarial gains or losses, net of income taxes. The before tax income (loss) and related income tax effect are as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Before-Tax Amount Tax (Expense) or Benefit Net of Tax Amount Before-Tax Amount Tax Benefit or (Expense) Net of Tax Amount Foreign currency translation adjustments, net $ 51.4 $ - $ 51.4 $ 25.7 $ - $ 25.7 Foreign currency (losses) gains, net (21.7 ) 4.7 (17.0 ) (6.2 ) 2.3 (3.9 ) Unrecognized gains (losses) on cash flow hedges, net 15.1 (3.7 ) 11.4 4.9 (1.9 ) 3.0 Pension and other postretirement benefit prior service cost and gain or loss, net (1.2 ) 1.6 0.4 (0.1 ) 0.3 0.2 Other comprehensive income $ 43.6 $ 2.6 $ 46.2 $ 24.3 $ 0.7 $ 25.0 Changes in accumulated other comprehensive (loss) income by component for the three month periods ended March 31, 2018 and 2017 are presented in the following table (1) Cumulative Currency Translation Adjustment Foreign Currency Gains and (Losses) Unrealized (Losses) Gains on Cash Flow Hedges Pension and Postretirement Benefit Plans Total Balance at December 31, 2017 $ (166.6 ) $ 37.0 $ (29.8 ) $ (40.4 ) $ (199.8 ) Other comprehensive income (loss) before reclassifications 51.4 (17.0 ) 7.8 - 42.2 Amounts reclassified from accumulated other comprehensive income (loss) - - 3.6 0.4 4.0 Other comprehensive income (loss) 51.4 (17.0 ) 11.4 0.4 46.2 Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) - - 0.3 - 0.3 Balance at March 31, 2018 $ (115.2 ) $ 20.0 $ (18.1 ) $ (40.0 ) $ (153.3 ) Cumulative Currency Translation Adjustment Foreign Currency Gains and (Losses) Unrealized (Losses) Gains on Cash Flow Hedges Pension and Postretirement Benefit Plans Total Balance at December 31, 2016 $ (324.2 ) $ 88.6 $ (42.2 ) $ (64.6 ) $ (342.4 ) Other comprehensive income (loss) before reclassifications 25.7 (3.9 ) (0.2 ) (0.5 ) 21.1 Amounts reclassified from accumulated other comprehensive income (loss) - - 3.2 0.7 3.9 Other comprehensive income (loss) 25.7 (3.9 ) 3.0 0.2 25.0 Balance at March 31, 2017 $ (298.5 ) $ 84.7 $ (39.2 ) $ (64.4 ) $ (317.4 ) (1) All amounts are net of tax. Amounts in parentheses indicate debits. Reclassifications out of accumulated other comprehensive (loss) income for the three month periods ended March 31, 2018 and 2017 are presented in the following table: Amount Reclassified from Accumulated Other Comprehensive (Loss) Income Details about Accumulated Other Comprehensive (Loss) Income Components For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Affected Line in the Statement Where Net Income is Presented Loss on cash flow hedges Interest rate swaps $ 4.8 $ 5.1 Interest expense 4.8 5.1 Total before tax (1.2 ) (1.9 ) Income tax benefit $ 3.6 $ 3.2 Net of tax Amortization of defined benefit pension and other postretirement benefit items $ 0.5 $ 1.2 (1) 0.5 1.2 Total before tax (0.1 ) (0.5 ) Income tax benefit $ 0.4 $ 0.7 Net of tax Total reclassifications for the period $ 4.0 $ 3.9 Net of tax (1) These components are included in the computation of net periodic benefit cost. See Note 7 “Pension and Other Postretirement Benefits” for additional details. |
Hedging Activities and Fair Val
Hedging Activities and Fair Value Measurements | 3 Months Ended |
Mar. 31, 2018 | |
Hedging Activities and Fair Value Measurements [Abstract] | |
Hedging Activities and Fair Value Measurements | Note 11. Hedging Activities and Fair Value Measurements Hedging Activities The Company is exposed to certain market risks during the normal course of its business arising from adverse changes in interest rates and foreign currency exchange rates. The Company selectively uses derivative financial instruments (“derivatives”), including foreign currency forward contracts and interest rate swaps, to manage the risks from fluctuations in foreign currency exchange rates and interest rates, respectively. The Company does not purchase or hold derivatives for trading or speculative purposes. Fluctuations in interest rates and foreign currency exchange rates can be volatile, and the Company’s risk management activities do not totally eliminate these risks. Consequently, these fluctuations could have a significant effect on the Company’s financial results. The Company’s exposure to interest rate risk results primarily from its variable-rate borrowings. The Company manages its debt centrally, considering tax consequences and its overall financing strategies. The Company manages its exposure to interest rate risk by maintaining a mixture of fixed and variable rate debt and, from time to time, using pay-fixed interest rate swaps as cash flow hedges of variable rate debt in order to adjust the relative fixed and variable proportions. A substantial portion of the Company’s operations is conducted by its subsidiaries outside of the United States in currencies other than the USD. Almost all of the Company’s non-U.S. subsidiaries conduct their business primarily in their local currencies, which are also their functional currencies. Other than the USD, the EUR, GBP, and Chinese Yuan are the principal currencies in which the Company and its subsidiaries enter into transactions. The Company is exposed to the impacts of changes in foreign currency exchange rates on the translation of its non-U.S. subsidiaries’ assets, liabilities and earnings into USD. The Company has certain U.S. subsidiaries borrow in currencies other than the USD. The Company and its subsidiaries are also subject to the risk that arises when they, from time to time, enter into transactions in currencies other than their functional currency. To mitigate this risk, the Company and its subsidiaries typically settle intercompany trading balances monthly. The Company also selectively uses forward currency contracts to manage this risk. These contracts for the sale or purchase of European and other currencies generally mature within one year. Derivative Instruments The following table summarizes the notional amounts, fair values and classification of the Company’s outstanding derivatives by risk category and instrument type within the Condensed Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017. March 31, 2018 Derivative Classification Notional Amount (1) Fair Value (1) Other Current Assets Fair Value (1) Other Assets Fair Value (1) Accrued Liabilities Fair Value (1) Other Liabilities Derivatives Designated as Hedging Instruments Interest rate swap contracts Cash Flow $ 1,125.0 $ - $ - $ 8.4 $ 23.2 Derivatives Not Designated as Hedging Instruments Foreign currency forwards Fair Value $ 19.3 $ 0.1 $ - $ - $ - Foreign currency forwards Fair Value $ 131.6 $ - $ - $ 0.3 $ - December 31, 2017 Derivative Classification Notional Amount (1) Fair Value (1) Other Current Assets Fair Value (1) Other Assets Fair Value (1) Accrued Liabilities Fair Value (1) Other Liabilities Derivatives Designated as Hedging Instruments Interest rate swap contracts Cash Flow $ 1,125.0 $ - $ - $ 16.1 $ 30.6 Derivatives Not Designated as Hedging Instruments Foreign currency forwards Fair Value $ 94.4 $ - $ - $ 1.2 $ - (1) Notional amounts represent the gross contract amounts of the outstanding derivatives excluding the total notional amount of positions that have been effectively closed through offsetting positions. The net gains and net losses associated with positions that have been effectively closed through offsetting positions but not yet settled are included in the asset and liability derivatives fair value columns, respectively. Gains and losses on derivatives designated as cash flow hedges included in the Condensed Consolidated Statements of Comprehensive (Loss) Income for the three month periods ended March 31, 2018 and 2017 are as presented in the table below. See Note 1 “Condensed Consolidated Financial Statements” for a discussion of the adoption of ASU 2017-12. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Interest rate swap contracts (1) Gain (loss) recognized in AOCI on derivatives $ 10.3 $ (0.2 ) Loss reclassified from AOCI into income (4.8 ) (5.1 ) (1) Losses on derivatives reclassified from accumulated other comprehensive income (“AOCI”) into income were included in “Interest expense” in the Condensed Consolidated Statements of Operations, the same income statement line item as the earnings effect of the hedged item. As of March 31, 2018, the Company is the fixed rate payor on 12 interest rate swap contracts that effectively fix the LIBOR-based index used to determine the interest rates charged on a total of $1,125.0 million of the Company’s LIBOR-based variable rate borrowings. These contracts carry fixed rates ranging from 2.9% to 4.4% and have expiration dates ranging from 2018 to 2020. These swap agreements qualify as hedging instruments and have been designated as cash flow hedges of forecasted LIBOR-based interest payments. Based on LIBOR-based swap yield curves as of March 31, 2018, the Company expects to reclassify losses of $13.3 million out of AOCI into earnings during the next 12 months. The Company’s LIBOR-based variable rate borrowings outstanding as of March 31, 2018 were $1,279.1 million and €611.9 million. The Company had three foreign currency forward contracts outstanding as of March 31, 2018 with notional amounts ranging from $19.3 million to $98.9 million. These contracts are used to hedge the change in fair value of recognized foreign currency denominated assets or liabilities caused by changes in currency exchange rates. The changes in the fair value of these contracts generally offset the changes in the fair value of a corresponding amount of the hedged items, both of which are included in the “Other operating expense, net” line on the face of the Condensed Consolidated Statements of Operations. The Company’s foreign currency forward contracts are subject to master netting arrangements or agreements between the Company and each counterparty for the net settlement of all contracts through a single payment in a single currency in the event of default on or termination of any one contract with that certain counterparty. It is the Company’s practice to recognize the gross amounts in the Condensed Consolidated Balance Sheets. The amount available to be netted is not material. The Company’s (losses) gains on derivative instruments not designated as accounting hedges and total net foreign currency (losses) gains for the three month periods ended March 31, 2018 and 2017 were as follows: For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Losses on foreign currency forward contracts $ (1.0 ) $ (2.2 ) Total foreign currency transaction losses, net (2.6 ) (0.6 ) The Company has a significant investment in consolidated subsidiaries with functional currencies other than the USD, particularly the EUR. The Company designated its Original Euro Term Loan as a hedge of the Company’s net investment in subsidiaries with EUR functional currencies in 2017 until it was extinguished and replaced on August 17, 2017 by a €615.0 million Euro Term Loan, further described in Note 8 “Debt”. On August 17, 2017, the Company designated the €615.0 million Euro Term Loan as a hedge of the Company’s net investment in subsidiaries with EUR functional currencies. As of March 31, 2018, the Euro Term Loan of €611.9 million remained designated. For the period from January 1, 2017 to August 16, 2017, the Company designated two cross currency interest rate swaps, each with a USD notional amount of $100.0 million as hedges of its net investment in EUR functional subsidiaries. Both cross currency interest rate swaps were terminated on August 16, 2017. The losses and gains from the change in the fair value of the designated net investment hedges were recorded through other comprehensive income. The recorded Accumulated Other Comprehensive (Loss) Income at the termination of the cross currency interest rate swaps will remain in Accumulated Other Comprehensive (Loss) Income until there is a substantial liquidation of the Company’s net investment in subsidiaries with EUR functional currencies. The Company’s gains and (losses), net of income tax, associated with changes in the value of debt and designated cross currency interest rate swaps for the three month periods ended March 31, 2018 and 2017 and the net balance of such gains and (losses) included in accumulated other comprehensive (loss) income as of March 31, 2018 and 2017 were as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Losses, net of income tax, recorded through other comprehensive income $ (15.2 ) $ (3.9 ) Balance included in accumulated other comprehensive income at March 31, 2018 and 2017, respectively 17.0 78.5 For the periods presented all cash flows associated with derivatives are classified as operating cash flows in the Condensed Consolidated Statements of Cash Flows. Fair Value Measurements A financial instrument is defined as cash or cash equivalents, evidence of an ownership interest in an entity, or a contract that creates a contractual obligation or right to deliver or receive cash or another financial instrument from another party. The Company’s financial instruments consist primarily of cash and cash equivalents, trade accounts receivables, trade accounts payables, deferred compensation assets and obligations, derivatives and debt instruments. The carrying values of cash and cash equivalents, trade accounts receivables, trade accounts payables, and variable rate debt instruments are a reasonable estimate of their respective fair values. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (exit price) in the principal or more advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value as follows: Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities as of the reporting date. Level 2 Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities as of the reporting date. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2018. Level 1 Level 2 Level 3 Total Financial Assets Foreign currency forwards (1) $ - $ 0.1 $ - $ 0.1 Trading securities held in deferred compensation plan (2) 6.0 - - 6.0 Total $ 6.0 $ 0.1 $ - $ 6.1 Financial Liabilities Foreign currency forwards (1) $ - $ 0.3 $ - $ 0.3 Interest rate swaps (3) - 31.6 - 31.6 Deferred compensation plan (2) 6.0 - - 6.0 Total $ 6.0 $ 31.9 $ - $ 37.9 (1) Based on calculations that use readily observable market parameters at their basis, such as spot and forward rates. (2) Based on the quoted price of publicly traded mutual funds which are classified as trading securities and accounted for using the mark-to-market method. (3) Measured as the present value of all expected future cash flows based on the LIBOR-based swap yield curves as of March 31, 2018. The present value calculation uses discount rates that have been adjusted to reflect the credit quality of the Company and its counterparties. |
Revenue from Contracts with Cus
Revenue from Contracts with Customers | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contracts with Customers [Abstract] | |
Revenue from Contracts with Customers | Note 12. Revenue from Contracts with Customers Overview The Company adopted ASC 606 on January 1, 2018 using the modified retrospective method. See Note 1 “Condensed Consolidated Financial Statements” for further discussion of the adoption. The Company recognizes revenue when control is transferred to the customer. The amount of revenue recognized includes adjustments for any variable consideration, such as rebates, sales discounts, liquidated damages, etc., which are included in the transaction price, and allocated to each performance obligation. The variable consideration is estimated throughout the course of the contract using the Company’s best estimates. Judgements impacting variable consideration related to material rebate and sales discount programs, and significant contracts containing liquidated damage clauses are governed by robust management review processes. The majority of the Company’s revenues are derived from short duration contracts and revenue is recognized at a single point in time when control is transferred to the customer, generally at shipment or when delivery has occurred or services have been rendered. The Company has certain long duration contracts that require highly engineered solutions designed to customer specific applications. For contracts where the contractual deliverables have no alternative use and the contract termination clauses provide for the recovery of cost plus a reasonable margin, revenue is recognized over time based on the Company’s progress in satisfying the contractual performance obligations generally measured as the ratio of actual costs incurred to date to the estimated total costs to complete the contract. For contracts with termination provisions that do not provide for recovery of cost and a reasonable margin, revenue is recognized at a point in time, generally at shipment or delivery to the customer. Identification of performance obligations, determination of alterative use, assessment of contractual language regarding termination provisions, and estimation of total project costs are all significant judgements required in the application of ASC 606. Contractual specifications and requirements may be modified. The Company considers contract modifications to exist when the modification either creates new or changes the existing enforceable rights and obligations. In the event a contract modification is for goods or services that are not distinct in the contract, and therefore, form part of a single performance obligation that is partially satisfied as of the modification date, the effect of the contract modification on the transaction price and the Company’s measure of progress for the performance obligation to which it relates, is recognized on a cumulative catch-up basis. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Disaggregation of Revenue The following tables provide disaggregated revenue by reportable segment for the three month period ended March 31, 2018. Industrials Energy Medical Total Primary Geographic Markets United States $ 90.4 $ 165.4 $ 21.3 $ 277.1 Other Americas 21.2 27.5 0.9 49.6 Total Americas $ 111.6 $ 192.9 $ 22.2 $ 326.7 EMEA 161.0 25.2 27.0 213.2 Asia Pacific 44.3 24.1 11.3 79.7 Total $ 316.9 $ 242.2 $ 60.5 $ 619.6 Product Categories Original equipment (1) $ 215.6 $ 91.3 $ 58.1 $ 365.0 Aftermarket (2) 101.3 150.9 2.4 254.6 Total $ 316.9 $ 242.2 $ 60.5 $ 619.6 Pattern of Revenue Recognition Revenue recognized at point in time (3) $ 307.6 $ 239.0 $ 60.5 $ 607.1 Revenue recognized over time (4) 9.3 3.2 - 12.5 Total $ 316.9 $ 242.2 $ 60.5 $ 619.6 (1) Revenues from sales of capital equipment within the Industrials and Energy Segments and sales of components to original equipment manufacturers in the Medical Segment. (2) Revenues from sales of spare parts, accessories, other components and services in support of maintaining customer owned, installed base of the Company’s original equipment. (3) Revenues from short and long duration product and service contracts recognized at a point in time when control is transferred to the customer generally when products delivery has occurred and services have been rendered. (4) Revenues primarily from long duration ETO product contracts and certain contracts for delivery of a significant volume of substantially similar products recognized over time as contractual performance obligations are completed. Performance Obligations The majority of the Company’s contracts have a single performance obligation as the promise to transfer goods and/or services. For contracts with multiple performance obligations, the Company utilizes observable prices to determine standalone selling price or cost plus margin if a standalone price is not available. The Company has elected to expense shipping and handling costs as incurred. The Company’s primary performance obligations include delivering standard or configured to order (“CTO”) goods to customers, designing and manufacturing a broad range of equipment customized to a customer’s specifications (Engineered to Order (“ETO”), rendering of services (maintenance and repair contracts), and certain extended or service type warranties. For incidental items that are immaterial in the context of the contract, costs are expensed as incurred or accrued at delivery. As of March 31, 2018, for contracts with an original duration greater than one year, the Company expects to recognize revenue in the future related to unsatisfied (or partially satisfied) performance obligations of $157.4 million in the next twelve months and $64.6 million in periods thereafter. The performance obligations that are unsatisfied (or partially satisfied) are primarily related to orders for goods or services that were placed prior to the end of the reporting period and have not been delivered to the customer, on-going work on ETO contracts where revenue is recognized over time, and service contracts with an original duration greater than one year. Contract Balances The following table provides the contract balances as of March 31, 2018 and December 31, 2017 presented on Condensed Consolidated Balance Sheets. March 31, 2018 December 31, 2017 Accounts receivable, net of allowance for doubtful accounts of $19.5 and $18.7, respectively $ 541.6 $ 536.3 Contract assets 4.8 - Contract liabilities 82.3 42.7 Accounts receivable - Contract assets – Contract liabilities – Contract assets and liabilities are reported on the Condensed Consolidated Balance Sheets on a contract-by-contract basis at the end of each reporting period. Contract assets and liabilities are presented net on a contract level, where required. Payments from customer are generally due 30-60 days after invoicing. Invoicing for sales of standard products generally coincides with shipment or delivery of goods. Invoicing for CTO and ETO contracts typically follows a schedule for billing at contractual milestones. Payment milestones normally include down payments upon the contract signing, completion of product design, completion of customer’s preliminary inspection, shipment or delivery, completion of installation, and customer’s on-site inspection. The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets) and customer advances and deposits (contract liabilities) on the Condensed Consolidated Balance Sheets. The Company has elected the practical expedient from ASC 606-10-32-18 and does not adjust the transaction price for the effects of a financing component if, at contract inception, the period between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Taxes [Abstract] | |
Income Taxes | Note 13. Income Taxes On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (“Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code that affected 2017, including, but not limited to, (1) requiring a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries that is payable over eight years and (2) bonus depreciation that will allow for full expensing of qualified property. The Tax Act also establishes new tax laws that affected 2018, including, but not limited to, (1) reduction of the U.S. federal corporate tax rate from 35% to 21%; (2) elimination of the corporate alternative minimum tax (“AMT”); (3) the creation of the base erosion anti-abuse tax (“BEAT”), a new minimum tax; (4) a general elimination of U.S. federal income taxes on dividends from foreign subsidiaries; (5) a new provision designed to tax global intangible low-taxed income (“GILTI”), which allows for the possibility of using foreign tax credits (“FTC”) and a deduction of up to 50% to offset the income tax liability (subject to some limitations); (6) a new limitation on deductible interest expense; (7) the repeal of the domestic production activity deduction; (8) limitations on the deductibility of certain executive compensation; (9) limitations on the use of FTCs to reduce the U.S. income tax liability; and (10) limitations on net operating losses (“NOL”) generated after December 31, 2017, to 80% of taxable income. The SEC staff issued SAB 118, which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Tax Act for which the accounting under ASC 740 is complete. To the extent that a company’s accounting for certain income tax effects of the Tax Act is incomplete but it is able to determine a reasonable estimate, a company must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, a company should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act. The Company has not completed the accounting for the income tax effects of certain elements of the Tax Act. If the Company was able to make reasonable estimates of the effects of elements for which an analysis is not yet complete, the Company recorded provisional adjustments, as described above. If the Company was not yet able to make reasonable estimates of the impact of certain elements, the Company has not recorded any adjustments related to those elements and have continued accounting for them in accordance with ASC 740 on the basis of the tax laws in effect before the Tax Act. As the Company completes the accounting of the income tax effects of the Tax Act, the Company anticipates that additional charges or benefits may be recorded at such time as prescribed by ASC 740 and SAB 118, and as further information becomes available regarding the Tax Act, the Company may make further adjustments to the provisions that have been recorded in the financial statements. The Company also continues to examine the impact the Tax Act. The Tax Act reduces the corporate tax rate to 21%, effective January 1, 2018. While the Company was able to make a reasonable estimate of the impact of the reduction in corporate rate, that estimate may be affected by other analyses related to the Tax Act, including, but not limited to, a calculation of deemed repatriation of deferred foreign income and the state tax effect of adjustments made to federal temporary differences. In the three month period ended March 31, 2018, no changes were made to the benefit recognized of $89.6 million in 2017. In addition, there was a $69.0 million benefit relating to the reduction of the ASC 740-30 liability also due to the change of the ending deferred tax rate for 2017. These benefits taken in 2017 have not changed in three months ended March 31, 2018. This as an estimate at March 31, 2018. The Deemed Repatriation Transition Tax (“Transition Tax”) is a tax on previously untaxed accumulated and current earnings and profits (“E&P”) of certain of our foreign subsidiaries. To determine the amount of the Transition Tax, we must determine, in addition to other factors, the amount of post-1986 E&P of the relevant subsidiaries, the amount of non-U.S. income taxes paid on such earnings, and the impact of the accumulated overall foreign source loss on our ability to utilize foreign tax credits. The Company was able to make a reasonable estimate at year end 2017 for the Transition Tax and recorded a provisional Transition Tax obligation of $63.3 million. As a result of further technical guidance, an adjustment of additional tax expense of $7.9 million was made in the period relating to the Transition Tax. This adjustment brings the total impact of Transition Tax to $71.3 million. The Company continues to gather additional information to more precisely compute the amount of the Transition Tax and therefore, this amount still an estimate as of March 31, 2018. The Company’s accounting for the following elements of the Tax Act is incomplete, and the Company is not yet able to make reasonable estimates of the effects. Therefore, no provisional adjustments, other than the adjustment related to the effects of the Transitional Tax, were recorded related to ASC 740-30. Due to complexities, the Company has not yet determined if a change to the policy concerning permanent reinvestment is required as a result of the new Tax Act. No additional adjustments relating to ASC 740-30 have been recorded in accordance with SAB 118. For 2018, the Tax Act creates a new requirement that certain income (i.e., GILTI) earned by controlled foreign corporations (“CFC”) must be included currently in the gross income of the CFCs’ U.S. shareholder. GILTI is the excess of the shareholder’s “net CFC tested income” over the net deemed tangible income return, which is currently defined as the excess of (1) 10% of the aggregate of the U.S. shareholder’s pro rata share of the qualified business asset investment of each CFC with respect to which it is a U.S. shareholder over (2) the amount of certain interest expense taken into account in the determination of net CFC-tested income. Under U.S. GAAP, the Company is allowed to make an accounting policy choice of either (1) treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (the “period cost method”) or (2) factoring such amounts into a company’s measurement of its deferred taxes (the “deferred method”). The Company has determined that it will follow the period costs method (option 1 above) going forward. The tax provision for the three month period ended March 31, 2018 reflects this decision. All of the additional calculations and rule changes found in The Tax Act have been considered in the tax provision for the three month period ended March 31, 2018. The following table summarizes the Company’s provision (benefit) for income taxes and effective income tax provision rate for the three month periods ended March 31, 2018 and 2017. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Income (loss) before income taxes $ 65.8 $ (8.6 ) Provision (benefit) for income taxes $ 23.4 $ (1.6 ) Effective income tax benefit rate 35.6 % 18.9 % The increase in the provision for income taxes and increase in the effective income tax provision rate for the three month period ended March 31, 2018 when compared to the same three month period of 2017 is primarily due to the change relating to Transition Tax imposed under the Tax Act of $7.9 million that increased the effective tax rate by approximately 12.0%. The remaining increase in the effective rate was due to the overall increase in forecasted global earnings when compared to the prior year. |
Supplemental Information
Supplemental Information | 3 Months Ended |
Mar. 31, 2018 | |
Supplemental Information [Abstract] | |
Supplemental Information | Note 14. Supplemental Information The components of “Other operating expense, net” for the three month periods ended March 31, 2018 and 2017 were as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Other Operating Expense, Net Foreign currency transaction losses, net $ 2.6 $ 0.6 Restructuring charges, net (1) - 1.7 Environmental remediation expenses (2) - 1.0 Stock-based compensation expense (3) 2.7 - Shareholder litigation settlement recoveries (4) (4.5 ) - Acquisition related expenses and non-cash charges (5) 3.0 0.8 (Gains) losses on asset and business disposals (1.2 ) 3.0 Other, net 1.7 0.8 Total other operating expense, net $ 4.3 $ 7.9 (1) See Note 3 “Restructuring.” (2) Estimated environmental remediation costs recorded on an undiscounted basis for a former production facility. (3) Represents stock-based compensation expense recognized for the three month period ended March 31, 2018 of $3.4 million reduced by a $0.7 million decrease in the accrual for employer taxes related to DSUs granted to employees at the date of the initial public offering. Prior to the Company’s initial public offering which occurred in May 2017, no stock-based compensation expense was recorded because the Company’s repurchase rights created an implicit service period. (4) Represents an insurance recovery of the Company’ shareholder litigation settlement in 2014. (5) Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs and non-cash charges and credits arising from fair value purchase accounting adjustments. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Contingencies [Abstract] | |
Contingencies | Note 15. Contingencies The Company is a party to various legal proceedings, lawsuits and administrative actions, which are of an ordinary or routine nature for a company of its size and sector. The Company believes that such proceedings, lawsuits and administrative actions will not materially adversely affect its operations, financial condition, liquidity or competitive position. A more detailed discussion of certain of these proceedings, lawsuits and administrative actions is set forth below. Asbestos and Silica Related Litigation The Company has also been named as a defendant in a number of asbestos-related and silica-related personal injury lawsuits. The plaintiffs in these suits allege exposure to asbestos or silica from multiple sources and typically the Company is one of approximately 25 or more named defendants. Predecessors to the Company sometimes manufactured, distributed and/or sold products allegedly at issue in the pending asbestos and silica-related lawsuits (the “Products”). However, neither the Company nor its predecessors ever mined, manufactured, mixed, produced or distributed asbestos fiber or silica sand, the materials that allegedly caused the injury underlying the lawsuits. Moreover, the asbestos-containing components of the Products, if any, were enclosed within the subject Products. Although the Company has never mined, manufactured, mixed, produced or distributed asbestos fiber or silica sand nor sold products that could result in a direct asbestos or silica exposure, many of the companies that did engage in such activities or produced such products are no longer in operation. This has led to law firms seeking potential alternative companies to name in lawsuits where there has been an asbestos or silica related injury. The Company believes that the pending and future asbestos and silica-related lawsuits are not likely to, in the aggregate, have a material adverse effect on its consolidated financial position, results of operations or liquidity, based on: the Company’s anticipated insurance and indemnification rights to address the risks of such matters; the limited potential asbestos exposure from the Products described above; the Company’s experience that the vast majority of plaintiffs are not impaired with a disease attributable to alleged exposure to asbestos or silica from or relating to the Products or for which the Company otherwise bears responsibility; various potential defenses available to the Company with respect to such matters; and the Company’s prior disposition of comparable matters. However, inherent uncertainties of litigation and future developments, including, without limitation, potential insolvencies of insurance companies or other defendants, an adverse determination in the Adams County Case (discussed below), or other inability to collect from the Company’s historical insurers or indemnitors, could cause a different outcome. While the outcome of legal proceedings is inherently uncertain, based on presently known facts, experience, and circumstances, the Company believes that the amounts accrued on its balance sheet are adequate and that the liabilities arising from the asbestos and silica-related personal injury lawsuits will not have a material adverse effect on the Company’s consolidated financial position, results of operations or liquidity. “Accrued liabilities” and “Other liabilities” on the Condensed Consolidated Balance Sheet include a total litigation reserve of $102.8 million and $105.6 million as of March 31, 2018 and December 31, 2017, with respect to potential liability arising from the Company’s asbestos-related litigation. Asbestos related defense costs are excluded from the asbestos claims liability and are recorded separately as services are incurred. In the event of unexpected future developments, it is possible that the ultimate resolution of these matters may be material to the Company’s consolidated financial position, results of operation or liquidity. The Company has entered into a series of agreements with certain of its or its predecessors’ legacy insurers and certain potential indemnitors to secure insurance coverage and/or reimbursement for the costs associated with the asbestos and silica-related lawsuits filed against the Company. The Company has also pursued litigation against certain insurers or indemnitors, where necessary. The Company has an insurance recovery receivable for probable asbestos related recoveries of approximately $96.4 million and $100.4 million as of March 31, 2018 and December 31, 2017, respectively, which was included in “Other assets” on the Consolidated Balance Sheets. During the three month period ended March 31, 2018, the Company received asbestos related insurance recoveries of $9.6 million, of which $4.0 million related to the recovery of indemnity payments, and was recorded as a reduction of the insurance recovery receivable in “Other assets” on the Condensed Consolidated Balance Sheets, and $5.6 million related to reimbursement of previously expensed legal defense costs, and was recorded as a reduction of “Selling and administrative expenses” in the Condensed Consolidated Statements of Operations. The largest such recent action, Gardner Denver, Inc. v. Certain Underwriters at Lloyd’s, London, et al., was filed on July 9, 2010, in the Eighth Judicial Circuit, Adams County, Illinois, as case number 10-L-48 (the “Adams County Case”). In the lawsuit, the Company seeks, among other things, to require certain excess insurer defendants to honor their insurance policy obligations to the Company, including payment in whole or in part of the costs associated with the asbestos-related lawsuits filed against the Company. In October 2011, the Company reached a settlement with one of the insurer defendants, which had issued both primary and excess policies, for approximately the amount of such defendant’s policies that were subject to the lawsuit. Since then, the case has been proceeding through the discovery and motions process with the remaining insurer defendants. On January 29, 2016, the Company prevailed on the first phase of that discovery and motions process (“Phase I”). Specifically, the Court in the Adams County Case ruled that the Company has rights under all of the policies in the case, subject to their terms and conditions, even though the policies were sold to the Company’s former owners rather than to the Company itself. On June 9, 2016, the Court denied a motion by several of the insurers who sought permission to appeal the Phase I ruling immediately rather than waiting until the end of the whole case as is normally required. The case is now proceeding through the discovery process regarding the remaining issues in dispute (“Phase II”). A majority of the Company’s expected future recoveries of the costs associated with the asbestos-related lawsuits are the subject of the Adams County Case. The amounts recorded by the Company for asbestos-related liabilities and insurance recoveries are based on currently available information and assumptions that the Company believes are reasonable based on an evaluation of relevant factors. The actual liabilities or insurance recoveries could be higher or lower than those recorded if actual results vary significantly from the assumptions. There are a number of key variables and assumptions including the number and type of new claims to be filed each year, the resolution or outcome of these claims, the average cost of resolution of each new claim, the amount of insurance available, allocation methodologies, the contractual terms with each insurer with whom the Company has reached settlements, the resolution of coverage issues with other excess insurance carriers with whom the Company has not yet achieved settlements, and the solvency risk with respect to the Company’s insurance carriers. Other factors that may affect the future liability include uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, legal rulings that may be made by state and federal courts, and the passage of state or federal legislation. The Company makes the necessary adjustments for the asbestos liability and corresponding insurance recoveries on an annual basis unless facts or circumstances warrant assessment as of an interim date. Environmental Matters The Company has been identified as a potentially responsible party (“PRP”) with respect to several sites designated for cleanup under U.S. federal “Superfund” or similar state laws that impose liability for cleanup of certain waste sites and for related natural resource damages. Persons potentially liable for such costs and damages generally include the site owner or operator and persons that disposed or arranged for the disposal of hazardous substances found at those sites. Although these laws impose joint and several liability on PRPs, in application the PRPs typically allocate the investigation and cleanup costs based upon the volume of waste contributed by each PRP. Based on currently available information, the Company was only a small contributor to these waste sites, and the Company has, or is attempting to negotiate, de minimis settlements for their cleanup. The cleanup of the remaining sites is substantially complete and the Company’s future obligations entail a share of the sites’ ongoing operating and maintenance expense. The Company is also addressing four on-site cleanups for which it is the primary responsible party. Three of these cleanup sites are in the operation and maintenance stage and one is in the implementation stage. The Company has undiscounted accrued liabilities of $7.3 million and $7.5 million as of March 31, 2018 and December 31, 2017, respectively, on its Condensed Consolidated Balance Sheet to the extent costs are known or can be reasonably estimated for its remaining financial obligations for the environmental matters discussed above and does not anticipate that any of these matters will result in material additional costs beyond amounts accrued. Based upon consideration of currently available information, the Company does not anticipate any material adverse effect on its results of operations, financial condition, liquidity or competitive position as a result of compliance with federal, state, local or foreign environmental laws or regulations, or cleanup costs relating to these matters. |
Segment Results
Segment Results | 3 Months Ended |
Mar. 31, 2018 | |
Segment Results [Abstract] | |
Segment Results | Note 16. Segment Results A description of the Company’s three reportable segments, including the specific products manufactured and sold follows below. In the Industrials segment, the Company designs, manufactures, markets and services a broad range of air compression, vacuum and blower products across a wide array of technologies and applications. Almost every manufacturing and industrial facility, and many service and process industries, use air compression and vacuum products in a variety of applications such as operation of pneumatic air tools, vacuum packaging of food products and aeration of waste water. The Company maintains a leading position in its markets and serves customers globally. The Company offers comprehensive aftermarket parts and an experienced direct and distributor-based service network world-wide to complement all of its products. In the Energy segment, the Company designs, manufactures, markets and services a diverse range of positive displacement pumps, liquid ring vacuum pumps and compressors, and engineered loading systems and fluid transfer equipment, consumables, and associated aftermarket parts and services. It serves customers in the upstream, midstream, and downstream oil and gas markets, and various other markets including petrochemical processing, power generation, transportation, and general industrial. The Company is one of the largest suppliers in these markets and has long-standing customer relationships. Its positive displacement pumps are used in the oilfield for drilling, hydraulic fracturing, completion and well servicing. Its liquid ring vacuum pumps and compressors are used in many power generation, mining, oil and gas refining and processing, chemical processing and general industrial applications including flare gas and vapor recovery, geothermal gas removal, vacuum de-aeration, enhanced oil recovery, water extraction in mining and paper and chlorine compression in petrochemical operations. Its engineered loading systems and fluid transfer equipment ensure the safe handling and transfer of crude oil, liquefied natural gas, compressed natural gas, chemicals, and bulk materials. In the Medical segment, the Company designs, manufactures and markets a broad range of highly specialized gas, liquid and precision syringe pumps and compressors primarily for use in the medical, laboratory and biotechnology end markets. The Company’s customers are mainly medium and large durable medical equipment suppliers that integrate the Company’s products into their final equipment for use in applications such as oxygen therapy, blood dialysis, patient monitoring, wound treatment, and others. Further, with the recent acquisitions, the Company has expanded into liquid handling components and systems used in biotechnology applications including clinical analysis instrumentation. The Company also has a broad range of end use deep vacuum products for laboratory science applications. The Chief Operating Decision Maker (“CODM”) evaluates the performance of the Company’s reportable segments based on, among other measures, Segment Adjusted EBITDA. Management closely monitors the Segment Adjusted EBITDA of each reportable segment to evaluate past performance and actions required to improve profitability. Inter-segment sales and transfers are not significant. Administrative expenses related to the Company’s corporate offices and shared service centers in the United States and Europe, which includes transaction processing, accounting and other business support functions, are allocated to the business segments. Certain administrative expenses, including senior management compensation, treasury, internal audit, tax compliance, certain information technology, and other corporate functions, are not allocated to the business segments. The following table provides summarized information about the Company’s operations by reportable segment and reconciles Segment Adjusted EBITDA to Income (Loss) Before Income Taxes for the three month periods ended March 31, 2018 and 2017. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Revenue Industrials $ 316.9 $ 248.0 Energy 242.2 178.3 Medical 60.5 55.4 Total Revenue $ 619.6 $ 481.7 Segment Adjusted EBITDA Industrials $ 66.8 $ 47.2 Energy 68.0 38.5 Medical 15.9 14.6 Total Segment Adjusted EBITDA $ 150.7 $ 100.3 Less items to reconcile Segment Adjusted EBITDA to Income (Loss) Before Income Taxes (1) Corporate expenses not allocated to segments (a) $ 2.5 $ 8.2 Interest expense 26.0 45.9 Depreciation and amortization expense 45.0 39.7 Sponsor fees and expenses (b) - 1.1 Restructuring and related business transformation costs (c) 4.5 8.6 Acquisition related expenses and non-cash charges (d) 4.6 0.7 Environmental remediation loss reserve (e) - 1.0 Expenses related to public stock offerings (f) 1.4 1.3 Establish public company financial reporting compliance (g) 0.8 1.3 Stock-based compensation (h) 2.7 - Foreign currency transaction losses, net 2.6 0.6 Shareholder litigation settlement recoveries (i) (4.5 ) - Other adjustments (j) (0.7 ) 0.5 Income (Loss) Before Income Taxes $ 65.8 $ (8.6 ) (1) The reconciling items for the three month period ended March 31, 2017 have been reclassified to conform to the methodology used in the three month period ended March 31, 2018, and include the following. (a) Includes insurance recoveries of asbestos legal fees of $5.6 million in the first quarter of 2018. (b) Represents management fees and expenses paid to the Company’s Sponsor. (c) Restructuring and related business transformation costs consist of the following. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Restructuring charges $ - $ 1.7 Severance, sign-on, relocation and executive search costs 2.0 1.0 Facility reorganization, relocation and other costs 0.6 1.1 Information technology infrastructure transformation - 0.7 (Gains) losses on asset and business disposals (1.2 ) 3.0 Consultant and other advisor fees 2.6 0.4 Other, net 0.5 0.7 Total restructuring and related business transformation costs $ 4.5 $ 8.6 (d) Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs and non-cash charges and credits arising from fair value purchase accounting adjustments. For the three month period ended March 31, 2018 and March 31, 2017, respectively, $3.0 million and $0.8 million, respectively, of acquisition related expenses and non-cash charges were recorded to the line “Other Operating Expense, net” in the Condensed Consolidated Statement of Operations. (e) Represents estimated environmental remediation costs and losses relating to a former production facility. (f) Represents certain expenses related to the Company’s initial public offering and subsequent secondary offerings. (g) Represents third party expenses to comply with the requirements of Sarbanes-Oxley in 2018 and the accelerated adoption of the new revenue recognition standard (ASC 606 – Revenue from Contracts with Customers (h) Represents stock-based compensation expense recognized for the three month period ended March 31, 2018 of $3.4 million reduced by a $0.7 million decrease in the accrual for employer taxes related to DSUs granted to employees at the date of the initial public offering. Prior to the Company’s initial public offering which occurred in May 2017, no stock-based compensation expense was recorded because the Company’s repurchase rights created an implicit service period. (i) Represents an insurance recovery of the Company’ shareholder litigation settlement in 2014. (j) Includes (i) the effects of the amortization of prior service costs and the amortization of gains in pension and other postretirement benefits (OPEB) expense, (ii) certain legal and compliance costs and (iii) other miscellaneous adjustments. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 17. Related Party Transactions Affiliates of KKR participated as (i) a lender in the Company’s Senior Secured Credit Facilities discussed in Note 8, “Debt,” (ii) an underwriter in the Company’s initial public offering, and (iii) a provider of services for the fiscal year 2017 debt refinancing transaction. KKR held a position in the Euro Term Loan Facility of €49.8 million as of March 31, 2018. The Company entered into a monitoring agreement, dated July 30, 2013, with KKR pursuant to which KKR will provide management, consulting and financial advisory services to the Company and its divisions, subsidiaries, parent entities and controlled affiliates. Under the terms of the monitoring agreement the Company was, among other things, obligated to pay KKR (or such affiliate(s) as KKR designates) an aggregate annual management fee in the initial annual amount of $3.5 million, payable in arrears at the end of each fiscal quarter, plus upon request all reasonable out of pocket expenses incurred in connection with the provision of services under the agreement. The management fee increases at a rate of 5% per year effective on January 1, 2014. In May 2017, in connection with the Company’s initial public offering, the monitoring agreement was terminated. The Company incurred management fees to KKR of $1.1 million and no out of pocket expenses for the three month period ended March 31, 2017. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings (Loss) Per Share [Abstract] | |
Earnings (Loss) Per Share | Note 18. Earnings (Loss) Per Share The computations of basic and diluted income (loss) per share are as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Net income (loss) $ 42.4 $ (7.0 ) Less: Net income attributable to noncontrolling interests - 0.1 Net income (loss) attributable to Gardner Denver Holdings, Inc. $ 42.4 $ (7.1 ) Average shares outstanding: Basic 201.6 148.5 Diluted 209.9 148.5 Earnings (loss) per share: Basic $ 0.21 $ (0.05 ) Diluted $ 0.20 $ (0.05 ) The DSUs described in Note 15, “Stock-Based Compensation” of the Consolidated Financial Statements in our annual report on Form 10-K for the fiscal year ended December 31, 2017 are considered outstanding shares for the purpose of computing basic earnings (loss) per share because they will become issued solely upon the passage of time. For the three month period ended March 31, 2018, there were 0.7 million anti-dilutive shares that were not included in the computation of diluted earnings per share. For the three month period ended March 31, 2017, there was 12.6 million potentially dilutive stock-based awards that were not included in the computation of diluted loss per share because their inclusion would be anti-dilutive. |
Condensed Consolidated Financ26
Condensed Consolidated Financial Statements (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Condensed Consolidated Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation Gardner Denver Holdings, Inc. is a holding company whose operating subsidiaries are Gardner Denver, Inc. (“GDI”) and certain of GDI’s subsidiaries. GDI is a diversified, global manufacturer of highly engineered, application-critical flow control products and provider of related aftermarket parts and services. The accompanying condensed consolidated financial statements include the accounts of Gardner Denver Holdings, Inc. and its majority-owned subsidiaries (collectively referred to herein as “Gardner Denver” or the “Company”). The financial information presented as of any date other than December 31, 2017 has been prepared from the books and records of the Company without audit. The accompanying 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. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, the condensed consolidated financial statements include all adjustments, consisting of adjustments associated with acquisition accounting and normal recurring adjustments, necessary for the fair presentation of such financial statements. All intercompany transactions and accounts have been eliminated in consolidation. The Company’s unaudited interim condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017, filed with the Securities and Exchange Commission (“SEC”). The results of operations for the three month period ended March 31, 2018 is not necessarily indicative of the results to be expected for the full year. The balance sheet as of December 31, 2017 has been derived from the Company’s audited financial statements as of that date but does not include all of the information and notes required by GAAP for complete financial statements. In May 2017, the Company sold a total of 47,495,000 shares of common stock in an initial public offering of shares of common stock. On November 15, 2017, the Company completed a secondary offering for a total of 25,300,000 shares of common stock held by affiliates of Kohlberg Kravis Roberts & Co. L.P. After completion of the initial public offering and the secondary offering, affiliates of Kohlberg Kravis Roberts & Co. L.P. continue to control a majority of the voting power of the Company’s common stock. As a result, the Company is considered a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange (“NYSE”). |
Prior Year Reclassification | Prior Year Reclassification In the first quarter of fiscal year 2018, the Company adopted the provisions of ASU 2017-07, Compensation – Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net periodic Postretirement Benefit Cost Adopted Accounting Standard Updates” |
Adopted Accounting Standard Updates ("ASU") | Adopted Accounting Standard Updates (“ASU”) ASU 2014-09, Revenue from Contracts with Customers (Topic 606) On January 1, 2018, the Company adopted Financial Accounting Standards Board (“FASB”) ASU 2014-09, Revenue from Contracts with Customers (Topic 606) In conjunction with adoption of ASC 606, the Company updated its significant accounting policy related to revenue recognition disclosed in Note 1 “Summary of Significant Accounting Policies” of the Consolidated Financial Statements in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2017. An overview of the Company’s revenue recognition policy under ASC 606 is included in Note 12 “Revenue from Contracts with Customers.” Results for the three month period ended March 31, 2018 is presented under ASC 606. Prior periods are not adjusted and will continue to be reported in accordance with ASC 605 Revenue Recognition The following tables summarize the impacts of adopting ASC 606 on the Company’s Condensed Consolidated Financial Statements for the three month period ended March 31, 2018. Condensed Consolidated Statements of Operations Balance Without As Reported Adjustments Adoption of ASC 606 Revenues $ 619.6 $ (3.9 ) $ 615.7 Cost of sales 387.7 (2.7 ) 385.0 Provision (benefit) for income taxes 23.4 (0.3 ) 23.1 Net Income (Loss) 42.4 (0.9 ) 41.5 Condensed Consolidated Balance Sheets Balance Without As Reported Adjustments Adoption of ASC 606 Assets Inventories $ 567.2 $ 2.7 $ 569.9 Other current assets (1) 50.8 (2.7 ) 48.1 Liabilities and Stockholders' Equity Accrued liabilities 305.4 0.9 306.3 Accumulated deficit (535.7 ) (0.9 ) (536.6 ) (1) Adjustment represents “Contract assets”. See Note 12 “Revenue from Contracts with Customers” for an explanation of the Contract assets account included in “Other Current assets” in the Condensed Consolidated Balance Sheets. ASU 2017-07 Compensation – Retirement Benefits (Topic 715) – Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost The Company adopted FASB ASU 2017-07 on January 1, 2018, the adoption date. The Company applied ASU 2017-07 retrospectively for the presentation of the service cost component and the other components of net periodic benefit cost in the income statement and prospectively for the capitalization of the service cost component of net periodic benefit cost in assets. ASU 2017-07 allows the Company to use the amounts disclosed in its pension and other postretirement benefit plan note for the prior comparative periods as the estimation basis for applying the retrospective presentation requirements. Applying the practical expedient, the Company reclassified $0.1 million of expense from “Selling and administrative expenses” to “Other income, net” within the Condensed Consolidated Statements of Operations for the three month period ended March 31, 2017. ASU 2017-12 Derivatives and Hedging (Topic 815) – Targeted Improvements to Accounting for Hedging Activities The Company early adopted FASB ASU 2017-12, Derivatives and Hedging (Topic 815) – Targeted Improvements to Accounting for Hedging Activities |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). In March 2018, the FASB issued ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) |
Condensed Consolidated Financ27
Condensed Consolidated Financial Statements (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Condensed Consolidated Financial Statements [Abstract] | |
Impacts of Adopting ASC 606 on the Company's Condensed Consolidated Financial Statements | The following tables summarize the impacts of adopting ASC 606 on the Company’s Condensed Consolidated Financial Statements for the three month period ended March 31, 2018. Condensed Consolidated Statements of Operations Balance Without As Reported Adjustments Adoption of ASC 606 Revenues $ 619.6 $ (3.9 ) $ 615.7 Cost of sales 387.7 (2.7 ) 385.0 Provision (benefit) for income taxes 23.4 (0.3 ) 23.1 Net Income (Loss) 42.4 (0.9 ) 41.5 Condensed Consolidated Balance Sheets Balance Without As Reported Adjustments Adoption of ASC 606 Assets Inventories $ 567.2 $ 2.7 $ 569.9 Other current assets (1) 50.8 (2.7 ) 48.1 Liabilities and Stockholders' Equity Accrued liabilities 305.4 0.9 306.3 Accumulated deficit (535.7 ) (0.9 ) (536.6 ) (1) Adjustment represents “Contract assets”. See Note 12 “Revenue from Contracts with Customers” for an explanation of the Contract assets account included in “Other Current assets” in the Condensed Consolidated Balance Sheets. |
Restructuring (Tables)
Restructuring (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring [Abstract] | |
Restructuring Programs by Segment | The following table summarizes the activity associated with the Company’s restructuring programs by segment for the three month period ended March 31, 2017. Industrials Program Energy Program Medical Program Total Balance at December 31, 2016 $ 11.1 $ 5.6 $ 4.2 $ 20.9 Charged to expense - Termination benefits 0.6 (0.2 ) (0.1 ) 0.3 Charged to expense - Other 0.8 0.6 - 1.4 Payments (4.6 ) (2.1 ) (0.5 ) (7.2 ) Other, net 0.1 (0.1 ) 0.1 0.1 Balance at March 31, 2017 $ 8.0 $ 3.8 $ 3.7 $ 15.5 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Inventories [Abstract] | |
Inventories | Inventories as of March 31, 2018 and December 31, 2017 consisted of the following. March 31, 2018 December 31, 2017 Raw materials, including parts and subassemblies $ 388.1 $ 362.6 Work-in-process 79.7 57.9 Finished goods 86.0 60.6 553.8 481.1 Excess of LIFO costs over FIFO costs 13.4 13.4 Inventories $ 567.2 $ 494.5 |
Goodwill and Other Intangible30
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill Attributable to Each Reportable Segment | The changes in the carrying amount of goodwill attributable to each reportable segment for the three month period ended March 31, 2018 is presented in the table below. Industrials Energy Medical Total Balance as of December 31, 2017 $ 561.6 $ 460.2 $ 205.8 $ 1,227.6 Acquisition 63.6 - - 63.6 Foreign currency translation 9.6 4.9 2.6 17.1 Balance as of March 31, 2018 $ 634.8 $ 465.1 $ 208.4 $ 1,308.3 |
Intangible Assets | Other intangible assets as of March 31, 2018 and December 31, 2017 consisted of the following. March 31, 2018 December 31, 2017 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Amortized intangible assets: Customer lists and relationships $ 1,248.7 $ (507.0 ) $ 1,226.8 $ (473.0 ) Technology 23.3 (4.3 ) 8.1 (4.0 ) Trademarks 38.4 (11.5 ) 30.3 (10.6 ) Backlog 70.5 (67.4 ) 65.5 (65.5 ) Other 55.3 (25.5 ) 53.6 (23.5 ) Unamortized intangible assets: Trademarks 628.7 - 623.5 - Total other intangible assets $ 2,064.9 $ (615.7 ) $ 2,007.8 $ (576.6 ) |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | Accrued liabilities as of March 31, 2018 and December 31, 2017 consisted of the following. March 31, 2018 December 31, 2017 Salaries, wages and related fringe benefits $ 86.4 $ 97.3 Restructuring 4.1 6.5 Taxes 48.2 34.5 Contract liabilities (1) 82.3 42.7 Product warranty 24.3 22.3 Accrued interest 0.9 0.8 Other 59.2 67.1 Total accrued liabilities $ 305.4 $ 271.2 (1) For purposes of comparability, “Advance payments on sales contracts” as of December 31, 2017 was reclassified to “Contract liabilities.” See Note 12 “Revenue from Contracts with Customers” for an explanation of the Contract liabilities account included in “Accrued liabilities” in the Condensed Consolidated Balance Sheets. |
Accrued Product Warranty Liability | A reconciliation of the changes in the accrued product warranty liability for the three month periods ended March 31, 2018 and 2017 are as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Balance at beginning of period $ 22.3 $ 21.7 Product warranty accruals 6.1 5.9 Settlements (5.4 ) (5.4 ) Charged to other accounts (1) 1.3 0.3 Balance at end of period $ 24.3 $ 22.5 (1) Includes primarily the effects of foreign currency translation adjustments for the Company’s subsidiaries with functional currencies other than the USD and changes in the accrual related to acquisitions. |
Pension and Other Postretirem32
Pension and Other Postretirement Benefits (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Pension and Other Postretirement Benefits [Abstract] | |
Net Periodic Benefit Cost | The following table summarizes the components of net periodic benefit cost for the Company’s defined benefit pension plans and other postretirement benefit plans recognized for the three month periods ended March 31, 2018 and 2017. Pension Benefits Other Postretirement U.S. Plans Non-U.S. Plans Benefits For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2018 Service cost $ - $ 0.5 $ - Interest cost 0.5 1.9 - Expected return on plan assets (1.2 ) (3.0 ) - Recognition of: Unrecognized prior service cost - - - Unrecognized net actuarial loss - 0.5 - $ (0.7 ) $ (0.1 ) $ - Pension Benefits Other Postretirement U.S. Plans Non-U.S. Plans Benefits For the Three Month Period Ended March 31, 2017 For the Three Month Period Ended March 31, 2017 For the Three Month Period Ended March 31, 2017 Service cost $ - $ 0.4 $ - Interest cost 0.6 1.9 - Expected return on plan assets (1.1 ) (2.5 ) - Recognition of: Unrecognized prior service cost - - - Unrecognized net actuarial loss - 1.2 - $ (0.5 ) $ 1.0 $ - The components of net periodic benefit cost other than the service cost component are included in “Other income, net” in the Condensed Consolidated Statements of Operations. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt [Abstract] | |
Debt | The Company’s debt as of March 31, 2018 and December 31, 2017 is summarized as follows. March 31, 2018 December 31, 2017 Short-term borrowings $ - $ - Long-term debt: Revolving credit facility, due 2020 $ - $ - Receivables financing agreement, due 2020 - - Term loan denominated in U.S. dollars, due 2024 (1) 1,279.1 1,282.3 Term loan denominated in Euros, due 2024 (2) 753.9 735.9 Capitalized leases and other long-term debt 26.7 26.9 Unamortized debt issuance costs (4.6 ) (4.9 ) 2,055.1 2,040.2 Current maturities of long-term debt 21.1 20.9 Total long-term debt, net $ 2,034.0 $ 2,019.3 (1) As of March 31, 2018, the applicable interest rate was 5.05% and the weighted-average interest rate was 4.46% for the three month period ended March 31, 2018. (2) As of March 31, 2018, the applicable interest rate was 3.00% and the weighted-average interest rate was 3.00% for the three month period ended March 31, 2018. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Stock-Based Compensation Plans [Abstract] | |
Stock-Based Award Plan Activity | A summary of the Company’s stock option (including SARs) activity for the three month period ended March 31, 2018 is presented in the following table (underlying shares in thousands). Shares Weighted-Average Exercise Price (per share) Outstanding at December 31, 2017 12,834 $ 9.54 Granted 766 $ 32.06 Exercised or settled (391 ) $ 8.42 Forfeited (85 ) $ 8.43 Outstanding at March 31, 2018 13,124 $ 10.89 Vested at March 31, 2018 9,068 $ 9.07 |
Assumptions Used to Estimate Fair Value of Options Granted | The following assumptions were used to estimate the fair value of options granted (excluding previously disclosed modified awards) during the three month period ended March 31, 2018 using the Black-Scholes option-pricing model. Three Month Period Ended March 31, 2018 Assumptions: Expected life of options (in years) 7.00 - 7.50 Risk-free interest rate 2.9 % Assumed volatility 35.1 - 35.4 % Expected dividend rate 0.0 % |
Restricted Stock Unit Activity | A summary of the Company’s restricted stock unit activity for the three month period ended March 31, 2018 is presented in the following table (underlying shares in thousands). Shares Weighted-Average Grant-Date Fair Value Non-vested at December 31, 2017 - $ - Granted 337 $ 32.06 Vested - $ - Forfeited - $ - Non-vested at March 31, 2018 337 $ 32.06 |
Accumulated Other Comprehensi35
Accumulated Other Comprehensive (Loss) Income (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accumulated Other Comprehensive (Loss) Income [Abstract] | |
Other Comprehensive (Loss) Income | The before tax income (loss) and related income tax effect are as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Before-Tax Amount Tax (Expense) or Benefit Net of Tax Amount Before-Tax Amount Tax Benefit or (Expense) Net of Tax Amount Foreign currency translation adjustments, net $ 51.4 $ - $ 51.4 $ 25.7 $ - $ 25.7 Foreign currency (losses) gains, net (21.7 ) 4.7 (17.0 ) (6.2 ) 2.3 (3.9 ) Unrecognized gains (losses) on cash flow hedges, net 15.1 (3.7 ) 11.4 4.9 (1.9 ) 3.0 Pension and other postretirement benefit prior service cost and gain or loss, net (1.2 ) 1.6 0.4 (0.1 ) 0.3 0.2 Other comprehensive income $ 43.6 $ 2.6 $ 46.2 $ 24.3 $ 0.7 $ 25.0 |
Changes in Accumulated Other Comprehensive (Loss) Income | Changes in accumulated other comprehensive (loss) income by component for the three month periods ended March 31, 2018 and 2017 are presented in the following table (1) Cumulative Currency Translation Adjustment Foreign Currency Gains and (Losses) Unrealized (Losses) Gains on Cash Flow Hedges Pension and Postretirement Benefit Plans Total Balance at December 31, 2017 $ (166.6 ) $ 37.0 $ (29.8 ) $ (40.4 ) $ (199.8 ) Other comprehensive income (loss) before reclassifications 51.4 (17.0 ) 7.8 - 42.2 Amounts reclassified from accumulated other comprehensive income (loss) - - 3.6 0.4 4.0 Other comprehensive income (loss) 51.4 (17.0 ) 11.4 0.4 46.2 Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) - - 0.3 - 0.3 Balance at March 31, 2018 $ (115.2 ) $ 20.0 $ (18.1 ) $ (40.0 ) $ (153.3 ) Cumulative Currency Translation Adjustment Foreign Currency Gains and (Losses) Unrealized (Losses) Gains on Cash Flow Hedges Pension and Postretirement Benefit Plans Total Balance at December 31, 2016 $ (324.2 ) $ 88.6 $ (42.2 ) $ (64.6 ) $ (342.4 ) Other comprehensive income (loss) before reclassifications 25.7 (3.9 ) (0.2 ) (0.5 ) 21.1 Amounts reclassified from accumulated other comprehensive income (loss) - - 3.2 0.7 3.9 Other comprehensive income (loss) 25.7 (3.9 ) 3.0 0.2 25.0 Balance at March 31, 2017 $ (298.5 ) $ 84.7 $ (39.2 ) $ (64.4 ) $ (317.4 ) (1) All amounts are net of tax. Amounts in parentheses indicate debits. |
Reclassifications out of Accumulated Other Comprehensive (Loss) Income | Reclassifications out of accumulated other comprehensive (loss) income for the three month periods ended March 31, 2018 and 2017 are presented in the following table: Amount Reclassified from Accumulated Other Comprehensive (Loss) Income Details about Accumulated Other Comprehensive (Loss) Income Components For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Affected Line in the Statement Where Net Income is Presented Loss on cash flow hedges Interest rate swaps $ 4.8 $ 5.1 Interest expense 4.8 5.1 Total before tax (1.2 ) (1.9 ) Income tax benefit $ 3.6 $ 3.2 Net of tax Amortization of defined benefit pension and other postretirement benefit items $ 0.5 $ 1.2 (1) 0.5 1.2 Total before tax (0.1 ) (0.5 ) Income tax benefit $ 0.4 $ 0.7 Net of tax Total reclassifications for the period $ 4.0 $ 3.9 Net of tax (1) These components are included in the computation of net periodic benefit cost. See Note 7 “Pension and Other Postretirement Benefits” for additional details. |
Hedging Activities and Fair V36
Hedging Activities and Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Hedging Activities and Fair Value Measurements [Abstract] | |
Summary of Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type | The following table summarizes the notional amounts, fair values and classification of the Company’s outstanding derivatives by risk category and instrument type within the Condensed Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017. March 31, 2018 Derivative Classification Notional Amount (1) Fair Value (1) Other Current Assets Fair Value (1) Other Assets Fair Value (1) Accrued Liabilities Fair Value (1) Other Liabilities Derivatives Designated as Hedging Instruments Interest rate swap contracts Cash Flow $ 1,125.0 $ - $ - $ 8.4 $ 23.2 Derivatives Not Designated as Hedging Instruments Foreign currency forwards Fair Value $ 19.3 $ 0.1 $ - $ - $ - Foreign currency forwards Fair Value $ 131.6 $ - $ - $ 0.3 $ - December 31, 2017 Derivative Classification Notional Amount (1) Fair Value (1) Other Current Assets Fair Value (1) Other Assets Fair Value (1) Accrued Liabilities Fair Value (1) Other Liabilities Derivatives Designated as Hedging Instruments Interest rate swap contracts Cash Flow $ 1,125.0 $ - $ - $ 16.1 $ 30.6 Derivatives Not Designated as Hedging Instruments Foreign currency forwards Fair Value $ 94.4 $ - $ - $ 1.2 $ - (1) Notional amounts represent the gross contract amounts of the outstanding derivatives excluding the total notional amount of positions that have been effectively closed through offsetting positions. The net gains and net losses associated with positions that have been effectively closed through offsetting positions but not yet settled are included in the asset and liability derivatives fair value columns, respectively. |
Gains and Losses on Derivatives Designated as Cash Flow Hedges | Gains and losses on derivatives designated as cash flow hedges included in the Condensed Consolidated Statements of Comprehensive (Loss) Income for the three month periods ended March 31, 2018 and 2017 are as presented in the table below. See Note 1 “Condensed Consolidated Financial Statements” for a discussion of the adoption of ASU 2017-12. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Interest rate swap contracts (1) Gain (loss) recognized in AOCI on derivatives $ 10.3 $ (0.2 ) Loss reclassified from AOCI into income (4.8 ) (5.1 ) (1) Losses on derivatives reclassified from accumulated other comprehensive income (“AOCI”) into income were included in “Interest expense” in the Condensed Consolidated Statements of Operations, the same income statement line item as the earnings effect of the hedged item. |
(Losses) Gains on Derivative Instruments Not Designated as Accounting Hedges and Total Net Foreign Currency (Losses) Gains | The Company’s (losses) gains on derivative instruments not designated as accounting hedges and total net foreign currency (losses) gains for the three month periods ended March 31, 2018 and 2017 were as follows: For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Losses on foreign currency forward contracts $ (1.0 ) $ (2.2 ) Total foreign currency transaction losses, net (2.6 ) (0.6 ) |
Changes in Value of Debt and Designated Interest Rate Swaps | The Company’s gains and (losses), net of income tax, associated with changes in the value of debt and designated cross currency interest rate swaps for the three month periods ended March 31, 2018 and 2017 and the net balance of such gains and (losses) included in accumulated other comprehensive (loss) income as of March 31, 2018 and 2017 were as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Losses, net of income tax, recorded through other comprehensive income $ (15.2 ) $ (3.9 ) Balance included in accumulated other comprehensive income at March 31, 2018 and 2017, respectively 17.0 78.5 |
Assets and Liabilities Measured at Fair Value | The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2018. Level 1 Level 2 Level 3 Total Financial Assets Foreign currency forwards (1) $ - $ 0.1 $ - $ 0.1 Trading securities held in deferred compensation plan (2) 6.0 - - 6.0 Total $ 6.0 $ 0.1 $ - $ 6.1 Financial Liabilities Foreign currency forwards (1) $ - $ 0.3 $ - $ 0.3 Interest rate swaps (3) - 31.6 - 31.6 Deferred compensation plan (2) 6.0 - - 6.0 Total $ 6.0 $ 31.9 $ - $ 37.9 (1) Based on calculations that use readily observable market parameters at their basis, such as spot and forward rates. (2) Based on the quoted price of publicly traded mutual funds which are classified as trading securities and accounted for using the mark-to-market method. (3) Measured as the present value of all expected future cash flows based on the LIBOR-based swap yield curves as of March 31, 2018. The present value calculation uses discount rates that have been adjusted to reflect the credit quality of the Company and its counterparties. |
Revenue from Contracts with C37
Revenue from Contracts with Customers (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contracts with Customers [Abstract] | |
Disaggregation of Revenue | The following tables provide disaggregated revenue by reportable segment for the three month period ended March 31, 2018. Industrials Energy Medical Total Primary Geographic Markets United States $ 90.4 $ 165.4 $ 21.3 $ 277.1 Other Americas 21.2 27.5 0.9 49.6 Total Americas $ 111.6 $ 192.9 $ 22.2 $ 326.7 EMEA 161.0 25.2 27.0 213.2 Asia Pacific 44.3 24.1 11.3 79.7 Total $ 316.9 $ 242.2 $ 60.5 $ 619.6 Product Categories Original equipment (1) $ 215.6 $ 91.3 $ 58.1 $ 365.0 Aftermarket (2) 101.3 150.9 2.4 254.6 Total $ 316.9 $ 242.2 $ 60.5 $ 619.6 Pattern of Revenue Recognition Revenue recognized at point in time (3) $ 307.6 $ 239.0 $ 60.5 $ 607.1 Revenue recognized over time (4) 9.3 3.2 - 12.5 Total $ 316.9 $ 242.2 $ 60.5 $ 619.6 (1) Revenues from sales of capital equipment within the Industrials and Energy Segments and sales of components to original equipment manufacturers in the Medical Segment. (2) Revenues from sales of spare parts, accessories, other components and services in support of maintaining customer owned, installed base of the Company’s original equipment. (3) Revenues from short and long duration product and service contracts recognized at a point in time when control is transferred to the customer generally when products delivery has occurred and services have been rendered. (4) Revenues primarily from long duration ETO product contracts and certain contracts for delivery of a significant volume of substantially similar products recognized over time as contractual performance obligations are completed. |
Contract Balances | The following table provides the contract balances as of March 31, 2018 and December 31, 2017 presented on Condensed Consolidated Balance Sheets. March 31, 2018 December 31, 2017 Accounts receivable, net of allowance for doubtful accounts of $19.5 and $18.7, respectively $ 541.6 $ 536.3 Contract assets 4.8 - Contract liabilities 82.3 42.7 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Income Taxes [Abstract] | |
Benefit for Income Taxes and Effective Income Tax Rate | The following table summarizes the Company’s provision (benefit) for income taxes and effective income tax provision rate for the three month periods ended March 31, 2018 and 2017. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Income (loss) before income taxes $ 65.8 $ (8.6 ) Provision (benefit) for income taxes $ 23.4 $ (1.6 ) Effective income tax benefit rate 35.6 % 18.9 % |
Supplemental Information (Table
Supplemental Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Supplemental Information [Abstract] | |
Other Operating Expense, Net | The components of “Other operating expense, net” for the three month periods ended March 31, 2018 and 2017 were as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Other Operating Expense, Net Foreign currency transaction losses, net $ 2.6 $ 0.6 Restructuring charges, net (1) - 1.7 Environmental remediation expenses (2) - 1.0 Stock-based compensation expense (3) 2.7 - Shareholder litigation settlement recoveries (4) (4.5 ) - Acquisition related expenses and non-cash charges (5) 3.0 0.8 (Gains) losses on asset and business disposals (1.2 ) 3.0 Other, net 1.7 0.8 Total other operating expense, net $ 4.3 $ 7.9 (1) See Note 3 “Restructuring.” (2) Estimated environmental remediation costs recorded on an undiscounted basis for a former production facility. (3) Represents stock-based compensation expense recognized for the three month period ended March 31, 2018 of $3.4 million reduced by a $0.7 million decrease in the accrual for employer taxes related to DSUs granted to employees at the date of the initial public offering. Prior to the Company’s initial public offering which occurred in May 2017, no stock-based compensation expense was recorded because the Company’s repurchase rights created an implicit service period. (4) Represents an insurance recovery of the Company’ shareholder litigation settlement in 2014. (5) Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs and non-cash charges and credits arising from fair value purchase accounting adjustments. |
Segment Results (Tables)
Segment Results (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Results [Abstract] | |
Summarized Financial Information on Operations by Reportable Segment | The following table provides summarized information about the Company’s operations by reportable segment and reconciles Segment Adjusted EBITDA to Income (Loss) Before Income Taxes for the three month periods ended March 31, 2018 and 2017. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Revenue Industrials $ 316.9 $ 248.0 Energy 242.2 178.3 Medical 60.5 55.4 Total Revenue $ 619.6 $ 481.7 Segment Adjusted EBITDA Industrials $ 66.8 $ 47.2 Energy 68.0 38.5 Medical 15.9 14.6 Total Segment Adjusted EBITDA $ 150.7 $ 100.3 Less items to reconcile Segment Adjusted EBITDA to Income (Loss) Before Income Taxes (1) Corporate expenses not allocated to segments (a) $ 2.5 $ 8.2 Interest expense 26.0 45.9 Depreciation and amortization expense 45.0 39.7 Sponsor fees and expenses (b) - 1.1 Restructuring and related business transformation costs (c) 4.5 8.6 Acquisition related expenses and non-cash charges (d) 4.6 0.7 Environmental remediation loss reserve (e) - 1.0 Expenses related to public stock offerings (f) 1.4 1.3 Establish public company financial reporting compliance (g) 0.8 1.3 Stock-based compensation (h) 2.7 - Foreign currency transaction losses, net 2.6 0.6 Shareholder litigation settlement recoveries (i) (4.5 ) - Other adjustments (j) (0.7 ) 0.5 Income (Loss) Before Income Taxes $ 65.8 $ (8.6 ) (1) The reconciling items for the three month period ended March 31, 2017 have been reclassified to conform to the methodology used in the three month period ended March 31, 2018, and include the following. (a) Includes insurance recoveries of asbestos legal fees of $5.6 million in the first quarter of 2018. (b) Represents management fees and expenses paid to the Company’s Sponsor. (c) Restructuring and related business transformation costs consist of the following. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Restructuring charges $ - $ 1.7 Severance, sign-on, relocation and executive search costs 2.0 1.0 Facility reorganization, relocation and other costs 0.6 1.1 Information technology infrastructure transformation - 0.7 (Gains) losses on asset and business disposals (1.2 ) 3.0 Consultant and other advisor fees 2.6 0.4 Other, net 0.5 0.7 Total restructuring and related business transformation costs $ 4.5 $ 8.6 (d) Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs and non-cash charges and credits arising from fair value purchase accounting adjustments. For the three month period ended March 31, 2018 and March 31, 2017, respectively, $3.0 million and $0.8 million, respectively, of acquisition related expenses and non-cash charges were recorded to the line “Other Operating Expense, net” in the Condensed Consolidated Statement of Operations. (e) Represents estimated environmental remediation costs and losses relating to a former production facility. (f) Represents certain expenses related to the Company’s initial public offering and subsequent secondary offerings. (g) Represents third party expenses to comply with the requirements of Sarbanes-Oxley in 2018 and the accelerated adoption of the new revenue recognition standard (ASC 606 – Revenue from Contracts with Customers (h) Represents stock-based compensation expense recognized for the three month period ended March 31, 2018 of $3.4 million reduced by a $0.7 million decrease in the accrual for employer taxes related to DSUs granted to employees at the date of the initial public offering. Prior to the Company’s initial public offering which occurred in May 2017, no stock-based compensation expense was recorded because the Company’s repurchase rights created an implicit service period. (i) Represents an insurance recovery of the Company’ shareholder litigation settlement in 2014. (j) Includes (i) the effects of the amortization of prior service costs and the amortization of gains in pension and other postretirement benefits (OPEB) expense, (ii) certain legal and compliance costs and (iii) other miscellaneous adjustments. |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings (Loss) Per Share [Abstract] | |
Basic and Diluted Income (Loss) per Share | The computations of basic and diluted income (loss) per share are as follows. For the Three Month Period Ended March 31, 2018 For the Three Month Period Ended March 31, 2017 Net income (loss) $ 42.4 $ (7.0 ) Less: Net income attributable to noncontrolling interests - 0.1 Net income (loss) attributable to Gardner Denver Holdings, Inc. $ 42.4 $ (7.1 ) Average shares outstanding: Basic 201.6 148.5 Diluted 209.9 148.5 Earnings (loss) per share: Basic $ 0.21 $ (0.05 ) Diluted $ 0.20 $ (0.05 ) |
Condensed Consolidated Financ42
Condensed Consolidated Financial Statements (Details) $ in Millions | Nov. 15, 2017shares | May 31, 2017shares | Mar. 31, 2018USD ($)Contract | Mar. 31, 2017USD ($) | Dec. 31, 2017USD ($) | |
Condensed Consolidated Statements of Operations [Abstract] | ||||||
Revenues | $ 619.6 | $ 481.7 | ||||
Cost of sales | 387.7 | 307.1 | ||||
Provision (benefit) for income taxes | 23.4 | (1.6) | ||||
Net income (loss) | 42.4 | (7) | ||||
Assets [Abstract] | ||||||
Inventories | 567.2 | $ 494.5 | ||||
Other current assets | 50.8 | 39.5 | ||||
Liabilities and Stockholders' Equity [Abstract] | ||||||
Accrued liabilities | 305.4 | 271.2 | ||||
Accumulated deficit | (535.7) | (577.8) | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Selling and administrative expenses | $ 106.9 | 102.3 | ||||
Interest Rate Swap [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Number of contracts | Contract | 12 | |||||
Interest Rate Swap [Member] | LIBOR [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Long-term debt hedged | $ 1,125 | |||||
ASU 2017-07 [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Selling and administrative expenses | (0.1) | |||||
Other income, net | $ 0.1 | |||||
ASU 2017-12 [Member] | Interest Rate Swap [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Number of contracts | Contract | 12 | |||||
ASU 2017-12 [Member] | Interest Rate Swap [Member] | LIBOR [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Long-term debt hedged | $ 1,125 | |||||
Adjustments [Member] | ASC 606 [Member] | ||||||
Condensed Consolidated Statements of Operations [Abstract] | ||||||
Revenues | (3.9) | |||||
Cost of sales | (2.7) | |||||
Provision (benefit) for income taxes | (0.3) | |||||
Net income (loss) | (0.9) | |||||
Assets [Abstract] | ||||||
Inventories | 2.7 | |||||
Other current assets | [1] | (2.7) | ||||
Liabilities and Stockholders' Equity [Abstract] | ||||||
Accrued liabilities | 0.9 | |||||
Accumulated deficit | (0.9) | |||||
Balance Without Adoption of ASC 606 [Member] | ASC 606 [Member] | ||||||
Condensed Consolidated Statements of Operations [Abstract] | ||||||
Revenues | 615.7 | |||||
Cost of sales | 385 | |||||
Provision (benefit) for income taxes | 23.1 | |||||
Net income (loss) | 41.5 | |||||
Assets [Abstract] | ||||||
Inventories | 569.9 | |||||
Other current assets | 48.1 | |||||
Liabilities and Stockholders' Equity [Abstract] | ||||||
Accrued liabilities | 306.3 | |||||
Accumulated deficit | (536.6) | |||||
Common Stock [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Stock sold in initial public offering (in shares) | shares | 47,495,000 | |||||
Common Stock [Member] | Kohlberg Kravis Roberts & Co. L.P [Member] | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Stock sold in initial public offering (in shares) | shares | 25,300,000 | |||||
Accumulated Deficit [Member] | ||||||
Condensed Consolidated Statements of Operations [Abstract] | ||||||
Net income (loss) | $ 42.4 | |||||
Accumulated Deficit [Member] | ASU 2017-12 [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Cumulative effect adjustment | (0.3) | |||||
Accumulated Other Comprehensive Loss [Member] | ASU 2017-12 [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Cumulative effect adjustment | [2] | $ 0.3 | ||||
[1] | Adjustment represents "Contract assets". See Note 12 "Revenue from Contracts with Customers" for an explanation of the Contract assets account included in "Other Current assets" in the Condensed Consolidated Balance Sheets. | |||||
[2] | All amounts are net of tax. Amounts in parentheses indicate debits. |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Millions | Feb. 08, 2018 | Jun. 05, 2017 | Mar. 03, 2017 | Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 |
Business Combinations [Abstract] | ||||||
Net cash paid to acquire business | $ 94.9 | $ 0.3 | ||||
Goodwill | 1,308.3 | $ 1,227.6 | ||||
Revenues and Operating Income (Loss) [Abstract] | ||||||
Revenue | 15.2 | 0 | ||||
Operating income | $ 0.4 | $ 0 | ||||
Runtech Systems Oy [Member] | ||||||
Business Combinations [Abstract] | ||||||
Percentage interest acquired | 100.00% | |||||
Net cash paid to acquire business | $ 94.9 | |||||
Goodwill | 63.6 | |||||
Amortizable intangible assets | 31.3 | |||||
Goodwill deductible for tax purposes | $ 0 | |||||
LeROI Compressors [Member] | ||||||
Business Combinations [Abstract] | ||||||
Percentage interest acquired | 100.00% | |||||
Net cash paid to acquire business | $ 20.4 | |||||
Holdback recorded in accrued liabilities | 1.9 | |||||
Goodwill deductible for tax purposes | $ 0 | |||||
Tamrotor Kompressorit Oy [Member] | ||||||
Business Combinations [Abstract] | ||||||
Non-controlling ownership interest acquired | 49.00% | |||||
Cash consideration | $ 5.2 | |||||
Holdback recorded in accrued liabilities | 0.5 | |||||
Tamrotor Kompressorit Oy [Member] | Capital in Excess of Par Value [Member] | ||||||
Business Combinations [Abstract] | ||||||
Acquisition of non-controlling interest | 2.3 | |||||
Tamrotor Kompressorit Oy [Member] | Accumulated Other Comprehensive Loss [Member] | ||||||
Business Combinations [Abstract] | ||||||
Acquisition of non-controlling interest | $ 1.5 |
Restructuring (Details)
Restructuring (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2018 | Dec. 31, 2017 | |
Restructuring Program [Roll Forward] | |||
Balance at beginning of period | $ 20.9 | ||
Charged to expense - Termination benefits | 0.3 | ||
Charged to expense - Other | 1.4 | ||
Payments | (7.2) | ||
Other, net | 0.1 | ||
Balance at end of period | 15.5 | ||
Restructuring Reserves [Abstract] | |||
Restructuring reserves included in accrued liabilities | $ 4.1 | $ 6.5 | |
Restructuring reserves included in other liabilities | $ 0.2 | 0.2 | |
Industrials Restructuring Program [Member] | |||
Restructuring Program [Roll Forward] | |||
Balance at beginning of period | 11.1 | ||
Charged to expense - Termination benefits | 0.6 | ||
Charged to expense - Other | 0.8 | ||
Payments | (4.6) | ||
Other, net | 0.1 | ||
Balance at end of period | 8 | ||
Industrials Restructuring Program [Member] | Other Operating Expense, Net [Member] | |||
Restructuring Costs [Abstract] | |||
Restructuring costs incurred to date | 38.5 | ||
Energy Restructuring Program [Member] | |||
Restructuring Program [Roll Forward] | |||
Balance at beginning of period | 5.6 | ||
Charged to expense - Termination benefits | (0.2) | ||
Charged to expense - Other | 0.6 | ||
Payments | (2.1) | ||
Other, net | (0.1) | ||
Balance at end of period | 3.8 | ||
Energy Restructuring Program [Member] | Other Operating Expense, Net [Member] | |||
Restructuring Costs [Abstract] | |||
Restructuring costs incurred to date | 6.3 | ||
Medical Restructuring Program [Member] | |||
Restructuring Program [Roll Forward] | |||
Balance at beginning of period | 4.2 | ||
Charged to expense - Termination benefits | (0.1) | ||
Charged to expense - Other | 0 | ||
Payments | (0.5) | ||
Other, net | 0.1 | ||
Balance at end of period | $ 3.7 | ||
Medical Restructuring Program [Member] | Other Operating Expense, Net [Member] | |||
Restructuring Costs [Abstract] | |||
Restructuring costs incurred to date | $ 3.2 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Inventory, Net [Abstract] | ||
Raw materials, including parts and subassemblies | $ 388.1 | $ 362.6 |
Work-in-process | 79.7 | 57.9 |
Finished goods | 86 | 60.6 |
Total inventories | 553.8 | 481.1 |
Excess of LIFO costs over FIFO costs | 13.4 | 13.4 |
Inventories | $ 567.2 | $ 494.5 |
Goodwill and Other Intangible46
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Goodwill [Roll Forward] | |||
Balance at beginning of period | $ 1,227.6 | ||
Acquisition | 63.6 | ||
Foreign currency translation | 17.1 | ||
Balance at end of period | 1,308.3 | ||
Goodwill impairment charges | 0 | ||
Amortized intangible assets [Abstract] | |||
Accumulated amortization | (615.7) | $ (576.6) | |
Unamortized intangible assets [Abstract] | |||
Total other intangible assets | 2,064.9 | 2,007.8 | |
Intangible asset amortization expense | 30.9 | $ 27.6 | |
Future Amortization of Intangible Assets [Abstract] | |||
2,019 | 125.1 | ||
2,020 | 125.1 | ||
2,021 | 125.1 | ||
2,022 | 125.1 | ||
2,023 | 125.1 | ||
Industrials [Member] | |||
Goodwill [Roll Forward] | |||
Balance at beginning of period | 561.6 | ||
Acquisition | 63.6 | ||
Foreign currency translation | 9.6 | ||
Balance at end of period | 634.8 | ||
Energy [Member] | |||
Goodwill [Roll Forward] | |||
Balance at beginning of period | 460.2 | ||
Acquisition | 0 | ||
Foreign currency translation | 4.9 | ||
Balance at end of period | 465.1 | ||
Accumulated goodwill impairment losses | 563.9 | ||
Medical [Member] | |||
Goodwill [Roll Forward] | |||
Balance at beginning of period | 205.8 | ||
Acquisition | 0 | ||
Foreign currency translation | 2.6 | ||
Balance at end of period | 208.4 | ||
Trademarks [Member] | |||
Unamortized intangible assets [Abstract] | |||
Gross carrying amount | 628.7 | 623.5 | |
Customer Lists and Relationships [Member] | |||
Amortized intangible assets [Abstract] | |||
Gross carrying amount | 1,248.7 | 1,226.8 | |
Accumulated amortization | (507) | (473) | |
Technology [Member] | |||
Amortized intangible assets [Abstract] | |||
Gross carrying amount | 23.3 | 8.1 | |
Accumulated amortization | (4.3) | (4) | |
Trademarks [Member] | |||
Amortized intangible assets [Abstract] | |||
Gross carrying amount | 38.4 | 30.3 | |
Accumulated amortization | (11.5) | (10.6) | |
Backlog [Member] | |||
Amortized intangible assets [Abstract] | |||
Gross carrying amount | 70.5 | 65.5 | |
Accumulated amortization | (67.4) | (65.5) | |
Other [Member] | |||
Amortized intangible assets [Abstract] | |||
Gross carrying amount | 55.3 | 53.6 | |
Accumulated amortization | $ (25.5) | $ (23.5) |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | ||
Accrued Liabilities [Abstract] | ||||
Salaries, wages and related fringe benefits | $ 86.4 | $ 97.3 | ||
Restructuring | 4.1 | 6.5 | ||
Taxes | 48.2 | 34.5 | ||
Contract liabilities | [1] | 82.3 | 42.7 | |
Product warranty | 24.3 | 22.3 | ||
Accrued interest | 0.9 | 0.8 | ||
Other | 59.2 | 67.1 | ||
Total accrued liabilities | 305.4 | $ 271.2 | ||
Accrued Product Warranty Liability [Roll Forward] | ||||
Balance at beginning of period | 22.3 | $ 21.7 | ||
Product warranty accruals | 6.1 | 5.9 | ||
Settlements | (5.4) | (5.4) | ||
Charged to other accounts | [2] | 1.3 | 0.3 | |
Balance at end of period | $ 24.3 | $ 22.5 | ||
[1] | For purposes of comparability, "Advance payments on sales contracts" as of December 31, 2017 was reclassified to "Contract liabilities." See Note 12 "Revenue from Contracts with Customers" for an explanation of the Contract liabilities account included in "Accrued liabilities" in the Condensed Consolidated Balance Sheets. | |||
[2] | Includes primarily the effects of foreign currency translation adjustments for the Company's subsidiaries with functional currencies other than the USD, and changes in the accrual related to acquisitions. |
Pension and Other Postretirem48
Pension and Other Postretirement Benefits (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Pension Benefits [Member] | U.S. Plans [Member] | ||
Net Periodic Benefit Cost [Abstract] | ||
Service cost | $ 0 | $ 0 |
Interest cost | 0.5 | 0.6 |
Expected return on plan assets | (1.2) | (1.1) |
Recognition of [Abstract] | ||
Unrecognized prior service cost | 0 | 0 |
Unrecognized net actuarial loss | 0 | 0 |
Net periodic benefit cost | (0.7) | (0.5) |
Pension Benefits [Member] | Non-U.S. Plans [Member] | ||
Net Periodic Benefit Cost [Abstract] | ||
Service cost | 0.5 | 0.4 |
Interest cost | 1.9 | 1.9 |
Expected return on plan assets | (3) | (2.5) |
Recognition of [Abstract] | ||
Unrecognized prior service cost | 0 | 0 |
Unrecognized net actuarial loss | 0.5 | 1.2 |
Net periodic benefit cost | (0.1) | 1 |
Other Postretirement Benefits [Member] | ||
Net Periodic Benefit Cost [Abstract] | ||
Service cost | 0 | 0 |
Interest cost | 0 | 0 |
Expected return on plan assets | 0 | 0 |
Recognition of [Abstract] | ||
Unrecognized prior service cost | 0 | 0 |
Unrecognized net actuarial loss | 0 | 0 |
Net periodic benefit cost | $ 0 | $ 0 |
Debt, Summary of Debt (Details)
Debt, Summary of Debt (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | ||
Debt [Abstract] | |||
Short-term borrowings | $ 0 | $ 0 | |
Long-term debt [Abstract] | |||
Unamortized debt issuance costs | (4.6) | (4.9) | |
Total long-term debt, net, including current maturities | 2,055.1 | 2,040.2 | |
Current maturities of long-term debt | 21.1 | 20.9 | |
Total long-term debt, net | 2,034 | 2,019.3 | |
Revolving Credit Facility, Due 2020 [Member] | |||
Long-term debt [Abstract] | |||
Long-term debt | $ 0 | 0 | |
Debt instrument maturity date | Apr. 30, 2020 | ||
Receivables Financing Agreement, Due 2020 [Member] | |||
Long-term debt [Abstract] | |||
Long-term debt | $ 0 | 0 | |
Debt instrument maturity date | Jun. 30, 2020 | ||
Term Loan Denominated in U.S. Dollars, Due 2024 [Member] | |||
Long-term debt [Abstract] | |||
Long-term debt | $ 1,279.1 | [1] | 1,282.3 |
Debt instrument maturity date | Dec. 31, 2024 | ||
Interest rate | 5.05% | ||
Weighted-average interest rate | 4.46% | ||
Term Loan Denominated in Euros, Due 2024 [Member] | |||
Long-term debt [Abstract] | |||
Long-term debt | $ 753.9 | [2] | 735.9 |
Debt instrument maturity date | Dec. 31, 2024 | ||
Interest rate | 3.00% | ||
Weighted-average interest rate | 3.00% | ||
Capitalized Leases and Other Long-Term Debt [Member] | |||
Long-term debt [Abstract] | |||
Long-term debt | $ 26.7 | $ 26.9 | |
[1] | As of March 31, 2018, the applicable interest rate was 5.05% and the weighted-average interest rate was 4.46% for the three month period ended March 31, 2018. | ||
[2] | As of March 31, 2018, the applicable interest rate was 3.00% and the weighted-average interest rate was 3.00% for the three month period ended March 31, 2018. |
Debt, Senior Secured Credit Fac
Debt, Senior Secured Credit Facilities (Details) € in Millions, $ in Millions | Aug. 17, 2017USD ($) | Jun. 30, 2017 | Mar. 31, 2018USD ($) | Dec. 31, 2014 | Dec. 31, 2017USD ($) | Aug. 17, 2017EUR (€) | Mar. 04, 2016USD ($) | Jul. 30, 2013USD ($) | Jul. 30, 2013EUR (€) |
LIBOR [Member] | |||||||||
Interest Rate and Fees [Abstract] | |||||||||
Basis spread on variable rate | 1.00% | ||||||||
Term of variable rate | 1 month | ||||||||
Federal Funds Effective Rate [Member] | |||||||||
Interest Rate and Fees [Abstract] | |||||||||
Basis spread on variable rate | 0.50% | ||||||||
Senior Secured Credit Facility [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Aggregate principal amount | $ 2,825 | ||||||||
Prepayments [Abstract] | |||||||||
Percentage of annual excess cash flow for prepayment of outstanding loan | 50.00% | ||||||||
Percentage of annual excess cash flow for prepayment of outstanding loan under restrictive covenants | 25.00% | ||||||||
Percentage of the net cash proceeds of all non-ordinary course asset sales for prepayment of outstanding term loan | 100.00% | ||||||||
Percentage of net cash proceeds of any incurrence of debt for prepayment of outstanding term loan | 100.00% | ||||||||
Certain Covenants and Events of Default [Abstract] | |||||||||
Consolidated Total Debt to Consolidated EBITDA ratio | 5 | ||||||||
Investments in unrestricted subsidiaries | $ 100 | ||||||||
Percentage of consolidated EBITDA | 25.00% | ||||||||
Senior Secured Credit Facility [Member] | Maximum [Member] | |||||||||
Prepayments [Abstract] | |||||||||
Consolidated secured debt to consolidated EBITDA ratio considered for prepayment of outstanding term loan under covenant one | 3.50 | ||||||||
Certain Covenants and Events of Default [Abstract] | |||||||||
Letters of credit under restrictive covenant | $ 80 | ||||||||
Other non-cash collateralized letters of credit maximum amount under restrictive covenant | 25 | ||||||||
Provision of non-cash collateralized letters of credit outstanding | 50 | ||||||||
Aggregate amount of non-cash collateralized letters of credit outstanding | $ 120 | ||||||||
Senior Secured Credit Facility [Member] | Minimum [Member] | |||||||||
Prepayments [Abstract] | |||||||||
Consolidated secured debt to consolidated EBITDA ratio considered for prepayment of outstanding term loan under covenant two | 3 | ||||||||
Senior Secured Credit Facility [Member] | Condition One [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
EBITDA amount | $ 250 | ||||||||
Consolidated senior secured debt to consolidated EBITDA ratio | 5.50 | ||||||||
Senior Secured Credit Facility [Member] | Condition Two [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Consolidated senior secured debt to consolidated EBITDA ratio | 4.50 | ||||||||
Original Dollar Term Loan Facility [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Aggregate principal amount | $ 35 | $ 50 | 1,900 | ||||||
Maximum borrowing capacity | $ 1,285.5 | ||||||||
Prepayments [Abstract] | |||||||||
Percentage of premium on prepayment of term loan | 1.00% | ||||||||
Amortization and Final Maturity [Abstract] | |||||||||
Percentage of original principal amount for quarterly installment payment of debt amortization | 1.00% | ||||||||
Original Dollar Term Loan Facility [Member] | LIBOR [Member] | |||||||||
Interest Rate and Fees [Abstract] | |||||||||
Basis spread on variable rate | 0.00% | 1.00% | 2.75% | ||||||
Original Dollar Term Loan Facility [Member] | Base Rate [Member] | |||||||||
Interest Rate and Fees [Abstract] | |||||||||
Basis spread on variable rate | 1.75% | ||||||||
Euro Term Loan Due in 2020 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Aggregate principal amount | € | € 400 | ||||||||
Maximum borrowing capacity | € | € 615 | ||||||||
Prepayments [Abstract] | |||||||||
Percentage of premium on prepayment of term loan | 1.00% | ||||||||
Amortization and Final Maturity [Abstract] | |||||||||
Percentage of original principal amount for quarterly installment payment of debt amortization | 1.00% | ||||||||
Euro Term Loan Due in 2020 [Member] | LIBOR [Member] | |||||||||
Interest Rate and Fees [Abstract] | |||||||||
Basis spread on variable rate | 0.00% | 1.00% | 3.00% | ||||||
Revolving Credit Facility [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 360 | $ 400 | |||||||
Decrease in borrowing capacity | $ 40 | ||||||||
Expected decrease in borrowing capacity next year | $ 269.9 | ||||||||
Letters of credit outstanding | 7.4 | ||||||||
Unused availability | $ 352.6 | ||||||||
Consolidated senior secured debt to consolidated EBITDA ratio | 7 | ||||||||
Interest Rate and Fees [Abstract] | |||||||||
Commitment fee | 0.50% | ||||||||
Revolving Credit Facility [Member] | LIBOR [Member] | |||||||||
Interest Rate and Fees [Abstract] | |||||||||
Basis spread on variable rate | 0.00% | 2.75% | |||||||
Revolving Credit Facility [Member] | Base Rate [Member] | |||||||||
Interest Rate and Fees [Abstract] | |||||||||
Basis spread on variable rate | 1.75% | ||||||||
Revolving Credit Facility [Member] | Maximum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Consolidated senior secured debt to consolidated EBITDA ratio | 7.50 | ||||||||
Certain Covenants and Events of Default [Abstract] | |||||||||
Aggregate amount of non-cash collateralized letters of credit outstanding | $ 300 | ||||||||
Revolving Credit Facility [Member] | Condition Three [Member] | |||||||||
Interest Rate and Fees [Abstract] | |||||||||
Commitment fee | 0.375% | ||||||||
Revolving Credit Facility [Member] | Condition Three [Member] | Maximum [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Consolidated senior secured debt to consolidated EBITDA ratio | 3 | ||||||||
Revolving Credit Facility [Member] | Letter of Credit [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Maximum borrowing capacity | $ 200 |
Debt, Receivables Financing Agr
Debt, Receivables Financing Agreement (Details) € in Millions, $ in Millions | 3 Months Ended | ||
Mar. 31, 2018USD ($) | Mar. 31, 2018EUR (€) | May 31, 2016USD ($) | |
LIBOR [Member] | |||
Debt Instrument [Line Items] | |||
Outstanding borrowing | $ 1,279.1 | € 6,119 | |
Receivables Financing Agreement [Member] | |||
Debt Instrument [Line Items] | |||
Increase in aggregate borrowing capacity | 50 | ||
Aggregate borrowing capacity | 125 | ||
Outstanding borrowing | 0 | ||
Letters of credit outstanding | 33.3 | ||
Remaining borrowing capacity | $ 72.3 | ||
Letters of credit interest rate | 1.60% | ||
Prior notice period for prepayment of borrowings or letters of credit | 1 day | ||
Prior notice period for termination of agreement | 15 days | ||
Receivables Financing Agreement [Member] | LIBOR [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 1.60% | 1.60% | |
Receivables Financing Agreement [Member] | Base Rate [Member] | |||
Debt Instrument [Line Items] | |||
Interest rate | 1.60% | 1.60% | |
Receivables Financing Agreement [Member] | Maximum [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate borrowing | $ 75 |
Stock-Based Compensation Plans,
Stock-Based Compensation Plans, Stock-Based Award Plan Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | May 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 3.4 | ||
Accrued liabilities | 305.4 | $ 271.2 | |
Unrecognized compensation expense | $ 28.1 | ||
Stock Options and Stock Appreciation Rights [Member] | |||
Shares [Roll Forward] | |||
Outstanding, beginning balance (in shares) | 12,834 | ||
Granted (in shares) | 766 | ||
Exercised or settled (in shares) | (391) | ||
Forfeited (in shares) | (85) | ||
Outstanding, ending balance (in shares) | 13,124 | ||
Vested (in shares) | 9,068 | ||
Outstanding Weighted-Average Exercise Price [Abstract] | |||
Outstanding, beginning balance (in dollars per share) | $ 9.54 | ||
Granted (in dollars per share) | 32.06 | ||
Exercised or settled (in dollars per share) | 8.42 | ||
Forfeited (in dollars per share) | 8.43 | ||
Outstanding, ending balance (in dollars per share) | 10.89 | ||
Vested (in dollars per share) | $ 9.07 | ||
2013 Stock Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant and reserved for issuance (in shares) | 20,900 | ||
2013 Stock Incentive Plan [Member] | Equity Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 0 | ||
2013 Stock Incentive Plan [Member] | Stock Appreciation Rights (SARs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Accrued liabilities | $ 15 | ||
2013 Stock Incentive Plan [Member] | 5 Years Vesting [Member] | Performance Based Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of awards vesting | 50.00% | ||
2013 Stock Incentive Plan [Member] | 5 Years Vesting [Member] | Time Based Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of awards vesting | 50.00% | ||
2013 Stock Incentive Plan [Member] | 4 Years Vesting [Member] | Performance Based Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of awards vesting | 50.00% | ||
2013 Stock Incentive Plan [Member] | 4 Years Vesting [Member] | Time Based Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of awards vesting | 50.00% | ||
2013 Stock Incentive Plan [Member] | 3 Years Vesting [Member] | Performance Based Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of awards vesting | 50.00% | ||
2013 Stock Incentive Plan [Member] | 3 Years Vesting [Member] | Time Based Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of awards vesting | 50.00% | ||
2017 Omnibus Incentive Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Number of shares available for grant and reserved for issuance (in shares) | 7,900 | 8,600 | |
Risk-free interest rate | 2.03% | ||
Expected dividend rate | 0.00% | ||
2017 Omnibus Incentive Plan [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected life of options | 1 year | ||
Assumed volatility | 26.80% | ||
2017 Omnibus Incentive Plan [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected life of options | 1 year 3 months | ||
Assumed volatility | 27.30% | ||
2013 and 2017 Plan [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 3.4 | ||
2013 and 2017 Plan [Member] | Former Employee [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 3.8 | ||
2013 and 2017 Plan [Member] | Equity Awards [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 1.4 | ||
2013 and 2017 Plan [Member] | Stock Appreciation Rights (SARs) [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Reduction in liability | $ 1.8 |
Stock-Based Compensation Plan53
Stock-Based Compensation Plans, Assumptions Used to Estimate Fair Value of Options Granted (Details) - Stock Options [Member] | 3 Months Ended |
Mar. 31, 2018 | |
Assumptions [Abstract] | |
Risk-free interest rate | 2.90% |
Expected dividend rate | 0.00% |
Minimum [Member] | |
Assumptions [Abstract] | |
Expected life of options | 7 years |
Assumed volatility | 35.10% |
Maximum [Member] | |
Assumptions [Abstract] | |
Expected life of options | 7 years 6 months |
Assumed volatility | 35.40% |
Stock-Based Compensation Plan54
Stock-Based Compensation Plans, Restricted Stock Unit Awards (Details) - Restricted Stock Unit [Member] shares in Thousands | 3 Months Ended |
Mar. 31, 2018$ / sharesshares | |
Shares [Roll Forward] | |
Non-vested, beginning balance (in shares) | shares | 0 |
Granted (in shares) | shares | 337 |
Vested (in shares) | shares | 0 |
Forfeited (in shares) | shares | 0 |
Non-vested, ending balance (in shares) | shares | 337 |
Weighted-Average Grant-Date Fair Value [Abstract] | |
Non-vested, beginning balance (in dollars per share) | $ / shares | $ 0 |
Granted (in dollars per share) | $ / shares | 32.06 |
Vested (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 0 |
Non-vested, ending balance (in dollars per share) | $ / shares | $ 32.06 |
Accumulated Other Comprehensi55
Accumulated Other Comprehensive (Loss) Income, Accumulated Other Comprehensive (Loss) Income Balances (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Before-Tax Amount [Abstract] | |||
Foreign currency translation adjustments, net | $ 51.4 | $ 25.7 | |
Foreign currency gains (losses), net | (21.7) | (6.2) | |
Unrecognized (losses) gains on cash flow hedges, net | 15.1 | 4.9 | |
Pension and other postretirement benefit prior service cost and gain or loss, net | (1.2) | (0.1) | |
Other comprehensive (loss) income | 43.6 | 24.3 | |
Tax (Expense) or Benefit [Abstract] | |||
Foreign currency translation adjustments, net | 0 | 0 | |
Foreign currency gains (losses), net | 4.7 | 2.3 | |
Unrecognized (losses) gains on cash flow hedges, net | (3.7) | (1.9) | |
Pension and other postretirement benefit prior service cost and gain or loss, net | 1.6 | 0.3 | |
Other comprehensive (loss) income | 2.6 | 0.7 | |
Net of Tax Amount [Abstract] | |||
Foreign currency translation adjustments, net | 51.4 | 25.7 | |
Foreign currency gains (losses), net | (17) | (3.9) | |
Unrecognized (losses) gains on cash flow hedges, net | 11.4 | 3 | |
Pension and other postretirement benefit prior service cost and gain or loss, net | 0.4 | 0.2 | |
Total other comprehensive income, net of tax | [1] | $ 46.2 | $ 25 |
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
Accumulated Other Comprehensi56
Accumulated Other Comprehensive (Loss) Income, Changes in Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | ||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Other comprehensive income (loss) before reclassifications | [1] | $ 42.2 | $ 21.1 | |
Amounts reclassified from accumulated other comprehensive income (loss) | [1] | 4 | 3.9 | |
Total other comprehensive income, net of tax | [1] | 46.2 | 25 | |
Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Beginning balance | [1] | (199.8) | (342.4) | |
Balance at end of period | [1] | (153.3) | (317.4) | |
Accumulated Other Comprehensive Income (Loss) [Member] | ASU 2017-12 [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) | [1] | $ 0.3 | ||
Cumulative Currency Translation Adjustment [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Beginning balance | [1] | (166.6) | (324.2) | |
Other comprehensive income (loss) before reclassifications | [1] | 51.4 | 25.7 | |
Amounts reclassified from accumulated other comprehensive income (loss) | [1] | 0 | 0 | |
Total other comprehensive income, net of tax | [1] | 51.4 | 25.7 | |
Balance at end of period | [1] | (115.2) | (298.5) | |
Cumulative Currency Translation Adjustment [Member] | ASU 2017-12 [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) | [1] | 0 | ||
Foreign Currency Gains and (Losses) [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Beginning balance | [1] | 37 | 88.6 | |
Other comprehensive income (loss) before reclassifications | [1] | (17) | (3.9) | |
Amounts reclassified from accumulated other comprehensive income (loss) | [1] | 0 | 0 | |
Total other comprehensive income, net of tax | [1] | (17) | (3.9) | |
Balance at end of period | [1] | 20 | 84.7 | |
Foreign Currency Gains and (Losses) [Member] | ASU 2017-12 [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) | [1] | 0 | ||
Unrealized (Losses) Gains on Cash Flow Hedges [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Beginning balance | [1] | (29.8) | (42.2) | |
Other comprehensive income (loss) before reclassifications | [1] | 7.8 | (0.2) | |
Amounts reclassified from accumulated other comprehensive income (loss) | [1] | 3.6 | 3.2 | |
Total other comprehensive income, net of tax | [1] | 11.4 | 3 | |
Balance at end of period | [1] | (18.1) | (39.2) | |
Unrealized (Losses) Gains on Cash Flow Hedges [Member] | ASU 2017-12 [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) | [1] | 0.3 | ||
Pension and Postretirement Benefit Plans [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Beginning balance | [1] | (40.4) | (64.6) | |
Other comprehensive income (loss) before reclassifications | [1] | 0 | (0.5) | |
Amounts reclassified from accumulated other comprehensive income (loss) | [1] | 0.4 | 0.7 | |
Total other comprehensive income, net of tax | [1] | 0.4 | 0.2 | |
Balance at end of period | [1] | $ (40) | $ (64.4) | |
Pension and Postretirement Benefit Plans [Member] | ASU 2017-12 [Member] | ||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||
Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) | [1] | $ 0 | ||
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
Accumulated Other Comprehensi57
Accumulated Other Comprehensive (Loss) Income, Reclassifications out of Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Income Statement [Abstract] | |||
Interest expense | $ 26 | $ 45.9 | |
Total before tax | 65.8 | (8.6) | |
Income tax benefit | (23.4) | 1.6 | |
Net of tax | 42.4 | (7) | |
Reclassification out of Accumulated Other Comprehensive (Loss) Income [Member] | |||
Income Statement [Abstract] | |||
Net of tax | 4 | 3.9 | |
Loss on Cash Flow Hedges - Interest Rate Swaps [Member] | Reclassification out of Accumulated Other Comprehensive (Loss) Income [Member] | |||
Income Statement [Abstract] | |||
Interest expense | 4.8 | 5.1 | |
Total before tax | 4.8 | 5.1 | |
Income tax benefit | (1.2) | (1.9) | |
Net of tax | 3.6 | 3.2 | |
Amortization of Defined Benefit Pension and Other Postretirement Benefit Items [Member] | Reclassification out of Accumulated Other Comprehensive (Loss) Income [Member] | |||
Income Statement [Abstract] | |||
Net periodic benefit cost | [1] | 0.5 | 1.2 |
Total before tax | 0.5 | 1.2 | |
Income tax benefit | (0.1) | (0.5) | |
Net of tax | $ 0.4 | $ 0.7 | |
[1] | These components are included in the computation of net periodic benefit cost. See Note 7 "Pension and Other Postretirement Benefits" for additional details. |
Hedging Activities and Fair V58
Hedging Activities and Fair Value Measurements, Hedging Activities and Derivative Instruments within the Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | ||
Maximum [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Maturity period of foreign currency contracts | 1 year | ||
Interest Rate Swap Contracts [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Notional amount | [1] | $ 1,125 | $ 1,125 |
Interest Rate Swap Contracts [Member] | Other Current Assets [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Assets fair value | [1] | 0 | 0 |
Interest Rate Swap Contracts [Member] | Other Assets [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Assets fair value | [1] | 0 | 0 |
Interest Rate Swap Contracts [Member] | Accrued Liabilities [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Liabilities fair value | [1] | 8.4 | 16.1 |
Interest Rate Swap Contracts [Member] | Other Liabilities [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Liabilities fair value | [1] | 23.2 | 30.6 |
Foreign Currency Forwards [Member] | Maximum [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Notional amount | 98.9 | ||
Foreign Currency Forwards [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Notional amount | [1] | 19.3 | 94.4 |
Foreign Currency Forwards [Member] | Other Current Assets [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Assets fair value | [1] | 0.1 | 0 |
Foreign Currency Forwards [Member] | Other Assets [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Assets fair value | [1] | 0 | 0 |
Foreign Currency Forwards [Member] | Accrued Liabilities [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Liabilities fair value | [1] | 0 | 1.2 |
Foreign Currency Forwards [Member] | Other Liabilities [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Liabilities fair value | [1] | 0 | $ 0 |
Foreign Currency Forwards [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Notional amount | [1] | 131.6 | |
Foreign Currency Forwards [Member] | Other Current Assets [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Assets fair value | [1] | 0 | |
Foreign Currency Forwards [Member] | Other Assets [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Assets fair value | [1] | 0 | |
Foreign Currency Forwards [Member] | Accrued Liabilities [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Liabilities fair value | [1] | 0.3 | |
Foreign Currency Forwards [Member] | Other Liabilities [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Liabilities fair value | [1] | $ 0 | |
[1] | Notional amounts represent the gross contract amounts of the outstanding derivatives excluding the total notional amount of positions that have been effectively closed through offsetting positions. The net gains and net losses associated with positions that have been effectively closed through offsetting positions but not yet settled are included in the asset and liability derivatives fair value columns, respectively. |
Hedging Activities and Fair V59
Hedging Activities and Fair Value Measurements, Derivative Instruments included in the Condensed Consolidated Statements of Comprehensive (Loss) Income (Details) - Interest Rate Swap Contracts [Member] - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Gains and Losses on Derivatives Designated as Cash Flow Hedges [Abstract] | |||
Gain (loss) recognized in AOCI on derivatives | [1] | $ 10.3 | $ (0.2) |
Loss reclassified from AOCI into income | [1] | $ (4.8) | $ (5.1) |
[1] | Losses on derivatives reclassified from accumulated other comprehensive income ("AOCI") into income were included in "Interest expense" in the Condensed Consolidated Statements of Operations, the same income statement line item as the earnings effect of the hedged item. |
Hedging Activities and Fair V60
Hedging Activities and Fair Value Measurements, Interest Rate Swap Contracts (Details) - 3 months ended Mar. 31, 2018 € in Millions, $ in Millions | USD ($)Contract | EUR (€)Contract |
LIBOR [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Expected losses to be reclassified out of AOCI into earnings during next 12 months | $ 13.3 | |
Long-term debt outstanding | $ 1,279.1 | € 6,119 |
Interest Rate Swap Contracts [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Number of contracts | Contract | 12 | 12 |
Interest Rate Swap Contracts [Member] | LIBOR [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Long-term debt hedged | $ 1,125 | |
Interest Rate Swap Contracts [Member] | LIBOR [Member] | Minimum [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Fixed interest rate | 2.90% | 2.90% |
Interest Rate Swap Contracts [Member] | LIBOR [Member] | Maximum [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Fixed interest rate | 4.40% | 4.40% |
Hedging Activities and Fair V61
Hedging Activities and Fair Value Measurements, Foreign Currency Forward Contracts (Details) - Foreign Currency Forwards [Member] $ in Millions | Mar. 31, 2018USD ($)Contract |
Derivatives, Fair Value [Line Items] | |
Number of contracts | Contract | 3 |
Minimum [Member] | |
Derivatives, Fair Value [Line Items] | |
Notional amount | $ 19.3 |
Maximum [Member] | |
Derivatives, Fair Value [Line Items] | |
Notional amount | $ 98.9 |
Hedging Activities and Fair V62
Hedging Activities and Fair Value Measurements, Derivative Instruments not Designated as Accounting Hedges (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Derivative instruments not designated as accounting hedges [Abstract] | ||
Total foreign currency transaction losses, net | $ (2.6) | $ (0.6) |
Losses on Foreign Currency Forward Contracts [Member] | ||
Derivative instruments not designated as accounting hedges [Abstract] | ||
Total foreign currency transaction losses, net | $ (1) | $ (2.2) |
Hedging Activities and Fair V63
Hedging Activities and Fair Value Measurements, Investment in Consolidated Subsidiaries with Functional Currencies Other than USD (Details) € in Millions, $ in Millions | 3 Months Ended | ||||
Mar. 31, 2018USD ($)Contract | Mar. 31, 2017USD ($) | Mar. 31, 2018EUR (€)Contract | Aug. 17, 2017EUR (€) | Aug. 16, 2017USD ($)Contract | |
Euro Term Loan Due in 2020 [Member] | |||||
Derivatives, Fair Value [Line Items] | |||||
Long-term debt hedged | € | € 611.9 | € 615 | |||
Cross Currency Interest Rate Swap Contracts [Member] | |||||
Derivatives, Fair Value [Line Items] | |||||
Number of contracts | Contract | 2 | ||||
Notional amount | $ 100 | ||||
Interest Rate Swap Contracts [Member] | |||||
Derivatives, Fair Value [Line Items] | |||||
Number of contracts | Contract | 12 | 12 | |||
Changes in the value of debt and designated interest rate swaps [Abstract] | |||||
Losses, net of income tax, recorded through other comprehensive income | $ (15.2) | $ (3.9) | |||
Balance included in accumulated other comprehensive income at March 31, 2018 and 2017, respectively | $ 17 | $ 78.5 |
Hedging Activities and Fair V64
Hedging Activities and Fair Value Measurements, Fair Value Measurements (Details) - Recurring [Member] $ in Millions | Mar. 31, 2018USD ($) | |
Financial Assets [Abstract] | ||
Foreign currency forwards | $ 0.1 | [1] |
Trading securities held in deferred compensation plan | 6 | [2] |
Total | 6.1 | |
Financial Liabilities [Abstract] | ||
Foreign currency forwards | 0.3 | [1] |
Interest rate swaps | 31.6 | [3] |
Deferred compensation plan | 6 | [2] |
Total | 37.9 | |
Level 1 [Member] | ||
Financial Assets [Abstract] | ||
Foreign currency forwards | 0 | [1] |
Trading securities held in deferred compensation plan | 6 | [2] |
Total | 6 | |
Financial Liabilities [Abstract] | ||
Foreign currency forwards | 0 | [1] |
Interest rate swaps | 0 | [3] |
Deferred compensation plan | 6 | [2] |
Total | 6 | |
Level 2 [Member] | ||
Financial Assets [Abstract] | ||
Foreign currency forwards | 0.1 | [1] |
Trading securities held in deferred compensation plan | 0 | [2] |
Total | 0.1 | |
Financial Liabilities [Abstract] | ||
Foreign currency forwards | 0.3 | [1] |
Interest rate swaps | 31.6 | [3] |
Deferred compensation plan | 0 | [2] |
Total | 31.9 | |
Level 3 [Member] | ||
Financial Assets [Abstract] | ||
Foreign currency forwards | 0 | [1] |
Trading securities held in deferred compensation plan | 0 | [2] |
Total | 0 | |
Financial Liabilities [Abstract] | ||
Foreign currency forwards | 0 | [1] |
Interest rate swaps | 0 | [3] |
Deferred compensation plan | 0 | [2] |
Total | $ 0 | |
[1] | Based on calculations that use readily observable market parameters at their basis, such as spot and forward rates. | |
[2] | Based on the quoted price of publicly traded mutual funds which are classified as trading securities and accounted for using the mark-to-market method. | |
[3] | Measured as the present value of all expected future cash flows based on the LIBOR-based swap yield curves as of March 31, 2018. The present value calculation uses discount rates that have been adjusted to reflect the credit quality of the Company and its counterparties. |
Revenue from Contracts with C65
Revenue from Contracts with Customers (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | ||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | $ 619.6 | $ 481.7 | ||
Revenue recognized on performance obligation in next 12 months | 157.4 | |||
Revenue to be recognized on performance obligations thereafter | 64.6 | |||
Contract with Customer, Asset and Liability [Abstract] | ||||
Accounts receivable, net of allowance for doubtful accounts of $19.5 and $18.7, respectively | 541.6 | $ 536.3 | ||
Contract assets | 4.8 | 0 | ||
Contract liabilities | 82.3 | 42.7 | ||
Accounts receivable, allowance for doubtful accounts | 19.5 | $ 18.7 | ||
Increase (decrease) for contract due to acquisition | 24.8 | |||
Increase (decrease) for contract due to impact in foreign currencies | 1.3 | |||
Revenue Recognized at Point in Time [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [1] | 607.1 | ||
Revenue Recognized over Time [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [2] | 12.5 | ||
Original Equipment [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [3] | 365 | ||
Aftermarket [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [4] | 254.6 | ||
Total Americas [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 326.7 | |||
United States [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 277.1 | |||
Other Americas [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 49.6 | |||
EMEA [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 213.2 | |||
Asia Pacific [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 79.7 | |||
Industrials [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 316.9 | |||
Industrials [Member] | Revenue Recognized at Point in Time [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [1] | 307.6 | ||
Industrials [Member] | Revenue Recognized over Time [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [2] | 9.3 | ||
Industrials [Member] | Original Equipment [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [3] | 215.6 | ||
Industrials [Member] | Aftermarket [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [4] | 101.3 | ||
Industrials [Member] | Total Americas [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 111.6 | |||
Industrials [Member] | United States [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 90.4 | |||
Industrials [Member] | Other Americas [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 21.2 | |||
Industrials [Member] | EMEA [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 161 | |||
Industrials [Member] | Asia Pacific [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 44.3 | |||
Energy [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 242.2 | |||
Energy [Member] | Revenue Recognized at Point in Time [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [1] | 239 | ||
Energy [Member] | Revenue Recognized over Time [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [2] | 3.2 | ||
Energy [Member] | Original Equipment [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [3] | 91.3 | ||
Energy [Member] | Aftermarket [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [4] | 150.9 | ||
Energy [Member] | Total Americas [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 192.9 | |||
Energy [Member] | United States [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 165.4 | |||
Energy [Member] | Other Americas [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 27.5 | |||
Energy [Member] | EMEA [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 25.2 | |||
Energy [Member] | Asia Pacific [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 24.1 | |||
Medical [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 60.5 | |||
Medical [Member] | Revenue Recognized at Point in Time [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [1] | 60.5 | ||
Medical [Member] | Revenue Recognized over Time [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [2] | 0 | ||
Medical [Member] | Original Equipment [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [3] | 58.1 | ||
Medical [Member] | Aftermarket [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | [4] | 2.4 | ||
Medical [Member] | Total Americas [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 22.2 | |||
Medical [Member] | United States [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 21.3 | |||
Medical [Member] | Other Americas [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 0.9 | |||
Medical [Member] | EMEA [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | 27 | |||
Medical [Member] | Asia Pacific [Member] | ||||
Revenue from Contract with Customer, Excluding Assessed Tax [Abstract] | ||||
Disaggregated revenue | $ 11.3 | |||
[1] | Revenues from short and long duration product and service contracts recognized at a point in time when control is transferred to the customer generally when products delivery has occurred and services have been rendered. | |||
[2] | Revenues primarily from long duration ETO product contracts and certain contracts for delivery of a significant volume of substantially similar products recognized over time as contractual performance obligations are completed. | |||
[3] | Revenues from sales of capital equipment within the Industrials and Energy Segments and sales of components to original equipment manufacturers in the Medical Segment. | |||
[4] | Revenues from sales of spare parts, accessories, other components and services in support of maintaining customer owned, installed base of the Company's original equipment. |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Income Taxes [Abstract] | |||
Foreign subsidiaries tax payable period | 8 years | ||
U.S. federal corporate tax rate | 21.00% | 35.00% | |
Change in tax rate, income tax benefit | $ (89.6) | ||
Benefit relating to the reduction of the ASC 740-30 liability | 69 | ||
Recorded provisional transition tax obligation | 63.3 | ||
Adjustment of additional tax expense | 7.9 | ||
Impact of transition tax expense after adjustments | $ 71.3 | ||
Income (loss) before income taxes | $ 65.8 | $ (8.6) | |
Provision (benefit) for income taxes | $ 23.4 | $ (1.6) | |
Effective income tax benefit rate | 35.60% | 18.90% | |
Increase in effective tax rate | 12.00% |
Supplemental Information (Detai
Supplemental Information (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | |||
Other Operating Expense, Net [Abstract] | ||||
Foreign currency transaction losses, net | $ 2.6 | $ 0.6 | ||
Restructuring charges, net | [1] | 0 | 1.7 | |
Environmental remediation expenses | [2] | 0 | 1 | |
Stock-based compensation expense | 2.7 | [3] | 0 | |
Shareholder litigation settlement recoveries | [4] | (4.5) | 0 | |
Acquisition related expenses and non-cash charges | [5] | 3 | 0.8 | |
(Gains) losses on asset and business disposals | (1.2) | 3 | ||
Other, net | 1.7 | 0.8 | ||
Total other operating expense, net | 4.3 | $ 7.9 | ||
Stock-based compensation expense recognized | 3.4 | |||
Decrease in stock-based compensation expense to DSU's | $ 0.7 | |||
[1] | See Note 3 "Restructuring." | |||
[2] | Estimated environmental remediation costs recorded on an undiscounted basis for a former production facility. | |||
[3] | Represents stock-based compensation expense recognized for the three month period ended March 31, 2018 of $3.4 million reduced by a $0.7 million decrease in the accrual for employer taxes related to DSUs granted to employees at the date of the initial public offering. Prior to the Company's initial public offering which occurred in May 2017, no stock-based compensation expense was recorded because the Company's repurchase rights created an implicit service period. | |||
[4] | Represents an insurance recovery of the Company' shareholder litigation settlement in 2014. | |||
[5] | Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs and non-cash charges and credits arising from fair value purchase accounting adjustments. |
Contingencies (Details)
Contingencies (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2018USD ($)DefendantSite | Dec. 31, 2017USD ($) | |
Asbestos and Silica Related Litigation [Abstract] | ||
Insurance recoveries of legal defense costs | $ 5.6 | |
Environmental Matters [Abstract] | ||
Number of on-site cleanups | Site | 4 | |
Number of on-site cleanups in operation and maintenance stage | Site | 3 | |
Number of on-site cleanups in implementation stage | Site | 1 | |
Undiscounted accrued liabilities | $ 7.3 | $ 7.5 |
Asbestos and Silica Related Litigation [Member] | ||
Asbestos and Silica Related Litigation [Abstract] | ||
Litigation reserve | 102.8 | 105.6 |
Insurance recovery receivable amount | 96.4 | $ 100.4 |
Asbestos related insurance recoveries | 9.6 | |
Recovery of indemnity payments | 4 | |
Insurance recoveries of legal defense costs | $ 5.6 | |
Asbestos and Silica Related Litigation [Member] | Minimum [Member] | ||
Asbestos and Silica Related Litigation [Abstract] | ||
Number of defendants | Defendant | 25 |
Segment Results (Details)
Segment Results (Details) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018USD ($)Segment | Mar. 31, 2017USD ($) | |||
Segment Results [Abstract] | ||||
Number of reportable segments | Segment | 3 | |||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 619.6 | $ 481.7 | ||
Less items to reconcile Segment Adjusted EBITDA to Income (Loss) Before Income Taxes [Abstract] | ||||
Interest expense | 26 | 45.9 | ||
Restructuring and related business transformation costs | 4.5 | 8.6 | ||
Acquisition related expenses and non-cash charges | [1] | 3 | 0.8 | |
Stock-based compensation | 3.4 | 0 | ||
Foreign currency transaction losses, net | (2.6) | (0.6) | ||
Shareholder litigation settlement recoveries | [2] | (4.5) | 0 | |
Income (Loss) Before Income Taxes | 65.8 | (8.6) | ||
Insurance recoveries of legal defense costs | 5.6 | |||
Restructuring and Related Business Transformation Costs [Abstract] | ||||
Restructuring charges | [3] | 0 | 1.7 | |
Severance, sign-on, relocation and executive search costs | 2 | 1 | ||
Facility reorganization, relocation and other costs | 0.6 | 1.1 | ||
Information technology infrastructure transformation | 0 | 0.7 | ||
(Gains) losses on asset and business disposals | (1.2) | 3 | ||
Consultant and other advisor fees | 2.6 | 0.4 | ||
Other, net | 0.5 | 0.7 | ||
Total restructuring and related business transformation costs | 4.5 | 8.6 | ||
Stock-based compensation expense recognized | 3.4 | |||
Decrease in stock-based compensation expense to DSU's | 0.7 | |||
Industrials [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 316.9 | |||
Energy [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 242.2 | |||
Medical [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 60.5 | |||
Operating Segments [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted EBITDA | 150.7 | 100.3 | ||
Operating Segments [Member] | Industrials [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 316.9 | 248 | ||
Adjusted EBITDA | 66.8 | 47.2 | ||
Operating Segments [Member] | Energy [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 242.2 | 178.3 | ||
Adjusted EBITDA | 68 | 38.5 | ||
Operating Segments [Member] | Medical [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 60.5 | 55.4 | ||
Adjusted EBITDA | 15.9 | 14.6 | ||
Corporate [Member] | ||||
Less items to reconcile Segment Adjusted EBITDA to Income (Loss) Before Income Taxes [Abstract] | ||||
Corporate expenses not allocated to segments | [5] | 2.5 | [4] | 8.2 |
Segment Reconciling Items [Member] | ||||
Less items to reconcile Segment Adjusted EBITDA to Income (Loss) Before Income Taxes [Abstract] | ||||
Interest expense | [5] | 26 | 45.9 | |
Depreciation and amortization expenses | [5] | 45 | 39.7 | |
Sponsor fees and expenses | [5],[6] | 0 | 1.1 | |
Restructuring and related business transformation costs | [5],[7] | 4.5 | 8.6 | |
Acquisition related expenses and non-cash charges | [5],[8] | 4.6 | 0.7 | |
Environmental remediation loss reserve | [5],[9] | 0 | 1 | |
Expenses related to public stock offerings | [5],[10] | 1.4 | 1.3 | |
Establishment of public company financial reporting compliance | [5] | 0.8 | [11] | 1.3 |
Stock-based compensation | [5] | 2.7 | [12] | 0 |
Foreign currency transaction losses, net | [5] | 2.6 | 0.6 | |
Shareholder litigation settlement recoveries | [2],[5] | (4.5) | 0 | |
Other adjustments | [5],[13] | (0.7) | 0.5 | |
Restructuring and Related Business Transformation Costs [Abstract] | ||||
Total restructuring and related business transformation costs | [5],[7] | $ 4.5 | $ 8.6 | |
[1] | Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs and non-cash charges and credits arising from fair value purchase accounting adjustments. | |||
[2] | Represents an insurance recovery of the Company' shareholder litigation settlement in 2014. | |||
[3] | See Note 3 "Restructuring." | |||
[4] | Includes insurance recoveries of asbestos legal fees of $5.6 million in the first quarter of 2018. | |||
[5] | The reconciling items for the three month period ended March 31, 2017 have been reclassified to conform to the methodology used in the three month period ended March 31, 2018, and include the following. | |||
[6] | Represents management fees and expenses paid to the Company's Sponsor. | |||
[7] | Restructuring and related business transformation costs consist of the following. | |||
[8] | Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs and non-cash charges and credits arising from fair value purchase accounting adjustments. For the three month period ended March 31, 2018 and March 31, 2017, respectively, $3.0 million and $0.8 million, respectively, of acquisition related expenses and non-cash charges were recorded to the line "Other Operating Expense, net" in the Condensed Consolidated Statement of Operations. | |||
[9] | Represents estimated environmental remediation costs and losses relating to a former production facility. | |||
[10] | Represents certain expenses related to the Company's initial public offering and subsequent secondary offerings. | |||
[11] | Represents third party expenses to comply with the requirements of Sarbanes-Oxley in 2018 and the accelerated adoption of the new revenue recognition standard (ASC 606 - Revenue from Contracts with Customers) in the first quarter of 2018, one year ahead of the required adoption date for a private company. | |||
[12] | Represents stock-based compensation expense recognized for the three month period ended March 31, 2018 of $3.4 million reduced by a $0.7 million decrease in the accrual for employer taxes related to DSUs granted to employees at the date of the initial public offering. Prior to the Company's initial public offering which occurred in May 2017, no stock-based compensation expense was recorded because the Company's repurchase rights created an implicit service period. | |||
[13] | Includes (i) the effects of the amortization of prior service costs and the amortization of gains in pension and other postretirement benefits (OPEB) expense, (ii) certain legal and compliance costs and (iii) other miscellaneous adjustments. |
Related Party Transactions (Det
Related Party Transactions (Details) - KKR [Member] € in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2018USD ($) | Mar. 31, 2018EUR (€) | |
Lender in Senior Secured Credit Facilities [Member] | Euro Term Loan Facility [Member] | ||
Related Party Transactions [Abstract] | ||
Related party transaction amount | € | € 49.8 | |
Monitoring Agreement [Member] | ||
Related Party Transactions [Abstract] | ||
Annual management fee due to related party | $ 3.5 | |
Annual percentage increase in fee | 5.00% | 5.00% |
Management Fees [Member] | ||
Related Party Transactions [Abstract] | ||
Expenses with related party | $ 1.1 |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Earnings (Loss) Per Share [Abstract] | ||
Net income (loss) | $ 42.4 | $ (7) |
Less: Net income attributable to noncontrolling interests | 0 | 0.1 |
Net Income (Loss) Attributable to Gardner Denver Holdings, Inc. | $ 42.4 | $ (7.1) |
Average shares outstanding [Abstract] | ||
Basic (in shares) | 201.6 | 148.5 |
Diluted (in shares) | 209.9 | 148.5 |
Earnings (loss) per share: [Abstract] | ||
Basic (in dollars per share) | $ 0.21 | $ (0.05) |
Diluted (in dollars per share) | $ 0.20 | $ (0.05) |
Stock Options [Member] | ||
Loss Per Share [Abstract] | ||
Antidilutive securities excluded from computation of diluted loss per share (in shares) | 0.7 | 12.6 |