Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Jul. 31, 2019 | |
Cover [Abstract] | ||
Entity Registrant Name | GARDNER DENVER HOLDINGS, INC. | |
Entity Central Index Key | 0001699150 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 204,099,619 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-38095 | |
Entity Tax Identification Number | 46-2393770 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 222 East Erie Street, Ste 500 | |
Entity Address, City or Town | Milwaukee | |
Entity Address, State or Province | WI | |
Entity Address, Postal Zip Code | 53202 | |
City Area Code | 414 | |
Local Phone Number | 212-4700 | |
Title of 12(b) Security | Common Stock, $0.01 Par Value | |
Trading Symbol | GDI | |
Security Exchange Name | NYSE |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) [Abstract] | ||||
Revenues | $ 629.1 | $ 668.2 | $ 1,249.4 | $ 1,287.7 |
Cost of sales | 394.7 | 418.9 | 784.5 | 806.6 |
Gross Profit | 234.4 | 249.3 | 464.9 | 481.1 |
Selling and administrative expenses | 103.6 | 115.8 | 211.3 | 222.6 |
Amortization of intangible assets | 30.9 | 31.5 | 62.3 | 62.4 |
Other operating expense, net | 25.3 | 0.6 | 36.4 | 4.9 |
Operating Income | 74.6 | 101.4 | 154.9 | 191.2 |
Interest expense | 22.4 | 26.1 | 44.8 | 52.1 |
Loss on extinguishment of debt | 0.2 | 0.2 | 0.2 | 0.2 |
Other income, net | (1.2) | (2.4) | (2.5) | (4.5) |
Income Before Income Taxes | 53.2 | 77.5 | 112.4 | 143.4 |
Provision for income taxes | 8.3 | 17.2 | 20.3 | 40.7 |
Net Income | $ 44.9 | $ 60.3 | $ 92.1 | $ 102.7 |
Basic earnings per share (in dollars per share) | $ 0.22 | $ 0.30 | $ 0.45 | $ 0.51 |
Diluted earnings per share (in dollars per share) | $ 0.21 | $ 0.29 | $ 0.44 | $ 0.49 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) [Abstract] | ||||||
Net income | $ 44.9 | $ 60.3 | $ 92.1 | $ 102.7 | ||
Other comprehensive loss, net of tax: | ||||||
Foreign currency translation adjustments, net | (6.4) | (67.5) | (6.5) | (33.1) | ||
Unrecognized (losses) gains on cash flow hedges, net | (0.5) | 4.7 | 1.4 | 16.1 | ||
Pension and other postretirement prior service cost and gain or loss, net | 1.2 | 2.7 | 1.4 | 3.1 | ||
Total other comprehensive loss, net of tax | (5.7) | (60.1) | (3.7) | [1] | (13.9) | [1] |
Total Comprehensive Income | $ 39.2 | $ 0.2 | $ 88.4 | $ 88.8 | ||
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 317.5 | $ 221.2 |
Accounts receivable, net of allowance for doubtful accounts of $18.2 and $17.4, respectively | 498.6 | 525.4 |
Inventories | 557.6 | 523.9 |
Other current assets | 90.2 | 60.7 |
Total current assets | 1,463.9 | 1,331.2 |
Property, plant and equipment, net of accumulated depreciation of $269.1 and $250.0, respectively | 345.1 | 356.6 |
Goodwill | 1,284.9 | 1,289.5 |
Other intangible assets, net | 1,303.8 | 1,368.4 |
Deferred tax assets | 1.1 | 1.3 |
Other assets | 195.5 | 140.1 |
Total assets | 4,594.3 | 4,487.1 |
Current liabilities: | ||
Short-term borrowings and current maturities of long-term debt | 8 | 7.9 |
Accounts payable | 331.8 | 340 |
Accrued liabilities | 251.5 | 248.5 |
Total current liabilities | 591.3 | 596.4 |
Long-term debt, less current maturities | 1,623.5 | 1,664.2 |
Pensions and other postretirement benefits | 91.1 | 94.8 |
Deferred income taxes | 272.9 | 265.5 |
Other liabilities | 230.2 | 190.2 |
Total liabilities | 2,809 | 2,811.1 |
Commitments and contingencies (Note 16) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value; 1,000,000,000 shares authorized; 205,676,965 and 201,051,291 shares issued as of June 30, 2019 and December 31, 2018, respectively | 2.1 | 2 |
Capital in excess of par value | 2,287.9 | 2,282.7 |
Accumulated deficit | (208.4) | (308.7) |
Accumulated other comprehensive loss | (258.9) | (247) |
Treasury stock at cost; 1,752,448 and 2,881,436 shares as of June 30, 2019 and December 31, 2018, respectively | (37.4) | (53) |
Total stockholders' equity | 1,785.3 | 1,676 |
Total liabilities and stockholders' equity | $ 4,594.3 | $ 4,487.1 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Accounts receivable, allowance for doubtful accounts | $ 18.2 | $ 17.4 |
Property, plant and equipment, accumulated depreciation | $ 269.1 | $ 250 |
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) | 205,676,965 | 201,051,291 |
Treasury stock (in shares) | 1,752,448 | 2,881,436 |
CONDENSED CONSOLIDATED STATEM_3
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 [Member] | $ (0.3) | $ 0.3 | [1] | ||||
Cumulative-effect adjustment upon adoption of new accounting standard | ASU 2018-02 [Member] | 0 | 0 | |||||
Balance at beginning of period at Dec. 31, 2017 | $ 2 | $ 2,275.4 | (577.8) | (199.8) | $ (23) | ||
Balance at beginning of period (in shares) at Dec. 31, 2017 | 198.4 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Purchases of treasury stock | (9.2) | ||||||
Issuance of common stock for stock-based compensation plans | $ 0 | 5.2 | |||||
Issuance of common stock for stock-based compensation plans (in shares) | 2.3 | ||||||
Issuance of treasury stock for stock-based compensation plans | (9.9) | 9.8 | |||||
Stock-based compensation | 7.6 | ||||||
Net income | 102.7 | $ 102.7 | |||||
Foreign currency translation adjustments, net | (33.1) | (33.1) | |||||
Unrecognized gains on cash flow hedges, net | 16.1 | 16.1 | |||||
Pension and other postretirement prior service cost and gain or loss, net | 3.1 | 3.1 | |||||
Balance at end of period at Jun. 30, 2018 | $ 2 | 2,278.3 | (475.4) | (213.4) | (22.4) | 1,569.1 | |
Balance at end of period (in shares) at Jun. 30, 2018 | 200.7 | ||||||
Balance at beginning of period at Mar. 31, 2018 | $ 2 | 2,282.3 | (535.7) | (153.3) | (27.6) | ||
Balance at beginning of period (in shares) at Mar. 31, 2018 | 199.4 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Purchases of treasury stock | (3) | ||||||
Issuance of common stock for stock-based compensation plans | $ 0 | 1.9 | |||||
Issuance of common stock for stock-based compensation plans (in shares) | 1.3 | ||||||
Issuance of treasury stock for stock-based compensation plans | (8.3) | 8.2 | |||||
Stock-based compensation | 2.4 | ||||||
Net income | 60.3 | 60.3 | |||||
Foreign currency translation adjustments, net | (67.5) | (67.5) | |||||
Unrecognized gains on cash flow hedges, net | 4.7 | 4.7 | |||||
Pension and other postretirement prior service cost and gain or loss, net | 2.7 | 2.7 | |||||
Balance at end of period at Jun. 30, 2018 | $ 2 | 2,278.3 | (475.4) | (213.4) | (22.4) | 1,569.1 | |
Balance at end of period (in shares) at Jun. 30, 2018 | 200.7 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Cumulative-effect adjustment upon adoption of new accounting standard | ASU 2017-12 [Member] | 0 | 0 | |||||
Cumulative-effect adjustment upon adoption of new accounting standard | ASU 2018-02 [Member] | 8.2 | (8.2) | [1] | ||||
Balance at beginning of period at Dec. 31, 2018 | $ 2 | 2,282.7 | (308.7) | (247) | (53) | 1,676 | |
Balance at beginning of period (in shares) at Dec. 31, 2018 | 201.1 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Purchases of treasury stock | (17.1) | ||||||
Issuance of common stock for stock-based compensation plans | $ 0.1 | 24.7 | |||||
Issuance of common stock for stock-based compensation plans (in shares) | 4.6 | ||||||
Issuance of treasury stock for stock-based compensation plans | (25.2) | 32.7 | |||||
Stock-based compensation | 5.7 | ||||||
Net income | 92.1 | 92.1 | |||||
Foreign currency translation adjustments, net | (6.5) | (6.5) | |||||
Unrecognized gains on cash flow hedges, net | 1.4 | 1.4 | |||||
Pension and other postretirement prior service cost and gain or loss, net | 1.4 | 1.4 | |||||
Balance at end of period at Jun. 30, 2019 | $ 2.1 | 2,287.9 | (208.4) | (258.9) | (37.4) | 1,785.3 | |
Balance at end of period (in shares) at Jun. 30, 2019 | 205.7 | ||||||
Balance at beginning of period at Mar. 31, 2019 | $ 2 | 2,289.3 | (253.3) | (253.2) | (47) | ||
Balance at beginning of period (in shares) at Mar. 31, 2019 | 203.3 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Purchases of treasury stock | (8.6) | ||||||
Issuance of common stock for stock-based compensation plans | $ 0.1 | 11.8 | |||||
Issuance of common stock for stock-based compensation plans (in shares) | 2.4 | ||||||
Issuance of treasury stock for stock-based compensation plans | (16) | 18.2 | |||||
Stock-based compensation | 2.8 | ||||||
Net income | 44.9 | 44.9 | |||||
Foreign currency translation adjustments, net | (6.4) | (6.4) | |||||
Unrecognized gains on cash flow hedges, net | (0.5) | (0.5) | |||||
Pension and other postretirement prior service cost and gain or loss, net | 1.2 | 1.2 | |||||
Balance at end of period at Jun. 30, 2019 | $ 2.1 | $ 2,287.9 | $ (208.4) | $ (258.9) | $ (37.4) | $ 1,785.3 | |
Balance at end of period (in shares) at Jun. 30, 2019 | 205.7 | ||||||
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash Flows From Operating Activities: | ||
Net income | $ 92.1 | $ 102.7 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Amortization of intangible assets | 62.3 | 62.4 |
Depreciation in cost of sales | 22.8 | 22.8 |
Depreciation in selling and administrative expenses | 4.8 | 5 |
Stock-based compensation expense | 13.6 | 5.2 |
Foreign currency transaction losses, net | 3.7 | 0.2 |
Net gain on asset dispositions | (0.3) | (1.2) |
Loss on extinguishment of debt | 0.2 | 0.2 |
Deferred income taxes | 6.5 | 9.2 |
Changes in assets and liabilities: | ||
Receivables | 17.2 | 43.2 |
Inventories | (35) | (46.8) |
Accounts payable | (0.8) | 45.3 |
Accrued liabilities | (0.9) | (42.7) |
Other assets and liabilities, net | (56.1) | (11) |
Net cash provided by operating activities | 130.1 | 194.5 |
Cash Flows From Investing Activities: | ||
Capital expenditures | (24.7) | (20.9) |
Net cash paid in business combinations | (0.5) | (113.6) |
Disposals of property, plant and equipment | 0.7 | 3.1 |
Net cash used in investing activities | (24.5) | (131.4) |
Cash Flows From Financing Activities: | ||
Principal payments on long-term debt | (28.8) | (110.5) |
Purchases of treasury stock | (17.1) | (9.2) |
Proceeds from stock option exercises | 32.1 | 5.2 |
Payments of contingent consideration | (2) | 0 |
Payments of debt issuance costs | (0.3) | 0 |
Net cash used in financing activities | (16.1) | (114.5) |
Effect of exchange rate changes on cash and cash equivalents | 6.8 | (4.1) |
Net increase (decrease) in cash and cash equivalents | 96.3 | (55.5) |
Cash and cash equivalents, beginning of period | 221.2 | 393.3 |
Cash and cash equivalents, end of period | 317.5 | 337.8 |
Supplemental Cash Flow Information | ||
Cash paid for income taxes | 31.5 | 62.4 |
Cash paid for interest | 42.5 | 51.7 |
Debt issuance costs in accounts payable | 0.5 | 0 |
Debt issuance costs in accrued liabilities | 5.6 | 0 |
Capital expenditures in accounts payable | $ 3.8 | $ 3.1 |
Condensed Consolidated Financia
Condensed Consolidated Financial Statements | 6 Months Ended |
Jun. 30, 2019 | |
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, 2018 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 the Company’s audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the Securities and Exchange Commission (“SEC”). The results of operations for the interim periods ended June 30, 2019 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, May 2, 2018 and October 31, 2018, the Company completed secondary offerings of 25,300,000 shares, 30,533,478 and 20,000,000 shares, respectively, of common stock held by affiliates of Kohlberg Kravis Roberts & Co. L.P. (“KKR”). As a result of the secondary offerings, the Company is no longer considered a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange (“NYSE”). KKR owns 70,671,135 shares of common stock, or approximately 35% of the total outstanding common stock based on the number of shares outstanding as of June 30, 2019. Recently Adopted Accounting Standard Updates (“ASU”) ASU 2016-02, Leases (Topic 842) On January 1, 2019, the Company adopted Financial Accounting Standards Board (“FASB”) ASU 2016-02, Leases (Topic 842) an approximate an approximate ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income On January 1, 2019, the Company adopted FASB ASU 2018-02 , Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income Recently Issued Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-14, Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40); Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Business Combinations | Note 2. Business Combinations Acquisition of MP Pumps, Inc. On December 12, 2018, the Company acquired MP Pumps, Inc. (“MP Pumps”), a leading manufacturer of specialty industrial pumps and associated aftermarket parts. The Company acquired all of the assets and assumed certain liabilities of MP Pumps for total consideration, net of cash acquired, of $58.5 million, which consisted of cash payments of $57.8 million, a payable $0.1 million purchase price adjustment and a $0.6 million holdback. During the first quarter of 2019, an additional purchase price adjustment of $0.2 million removed the $0.1 million payable purchase price adjustment and reduced the holdback to $0.5 million. The $0.5 million holdback was paid in the first quarter of 2019 and recorded in “Net cash paid in business combinations” in the Condensed Consolidated Statements of Cash Flows. The revenues and operating income of MP Pumps 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 DV Systems, Inc. On November 2, 2018, the Company acquired DV Systems, Inc. (“DV Systems”), a leading manufacturer of rotary screws and piston compressors and associated aftermarket parts. The Company acquired all of the assets and assumed certain liabilities of DV Systems for total consideration, net of cash acquired, of $16.1 million, which consisted of cash payments of $14.8 million and a $1.3 million holdback. During the first quarter of 2019, the purchase price was increased by $0.1 million and resulted in a payable $0.1 million purchase price adjustment. Of the $1.3 million holdback and $0.1 million purchase price adjustment, $0.4 million is expected to be paid by the end of the fourth quarter of 2019, $0.5 million by the end of the first quarter of 2020, and $0.5 million by the end of the fourth quarter of 2020. $0.9 million of the holdback and purchase price adjustment is recorded in “Accrued liabilities” in the Condensed Consolidated Balance Sheets and the remaining $0.5 million is recorded in “Other liabilities” in the Condensed Consolidated Balance Sheets. The revenues and operating income of DV Systems 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 PMI Pump Parts On May 29, 2018, the Company acquired PMI Pump Parts (“PMI”), a leading manufacturer of plungers and other well service pump consumable products. The Company acquired all of the assets and assumed certain liabilities of PMI for total consideration, net of cash acquired, of $21.0 million, which consisted of cash payments of $18.8 million, a $2.0 million promissory note and a $0.2 million holdback. The $0.2 million holdback and $1.0 million of the promissory note were paid in the fourth quarter of 2018. The remaining $1.0 million of the promissory note was paid in the second quarter of 2019 and recorded in “Payments for contingent consideration” in the Condensed Consolidated Statements of Cash Flows. The revenues and operating income of PMI are included in the Company’s condensed consolidated financial statements from the acquisition date and are included in the Energy segment. None of the goodwill resulting from this acquisition is deductible for tax purposes. 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 condensed consolidated financial statements from the acquisition date and are included in the Industrials segment. The 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 Revenues and Operating Income (Loss) The following table summarizes the revenue and operating income (loss) of these acquisitions for the periods presented subsequent to their date of acquisition. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Revenue $ 29.2 $ 15.7 $ 55.0 $ 23.6 Operating income (loss) 4.6 (0.9 ) 6.6 (2.0 ) Pro forma information regarding these acquisitions have not been provided as they did not have a material impact on the Company’s condensed consolidated results of operations individually or in the aggregate. Transaction with Ingersoll Rand On April 30, 2019, the Company entered into a definitive agreement with Ingersoll-Rand plc (“Ingersoll Rand”) pursuant to which Ingersoll Rand will separate its Industrial segment (“Ingersoll Rand Industrial”) and then combine it with the Company (the “Merger Agreement”). The transaction will be effected through a “Reverse Morris Trust” transaction pursuant to which Ingersoll Rand Industrial is expected to be spun-off to Ingersoll Rand’s shareholders and simultaneously merged with and surviving as a wholly-owned subsidiary of Gardner Denver (the “Merger”). Under the terms of the Merger Agreement, which has been unanimously approved by the Boards of Directors of Ingersoll Rand and the Company, at the time of close, Ingersoll Rand will receive $1.9 billion in cash from Ingersoll Rand Industrial that will be funded by newly-issued debt assumed by the Company in the Merger. Upon close of the transaction, existing Ingersoll Rand shareholders will receive 50.1% of the shares of the Company on a fully diluted basis. The Merger is expected to close in early 2020, subject to approval by the Company’s stockholders, regulatory approvals and customary closing conditions. |
Restructuring
Restructuring | 6 Months Ended |
Jun. 30, 2019 | |
Restructuring [Abstract] | |
Restructuring | Note 3. Restructuring Restructuring Program 2018 In the third quarter of 2018, the Company announced a restructuring program that primarily involves workforce reductions and facility consolidation. These actions are expected to continue throughout 2019 and are focused on targeted workforce optimization within general and administrative back-office and manufacturing overhead as well as continued facility consolidation. In the six month period ended June 30, 2019, $2.8 million was charged to expense through ‘‘Other operating expense, net’’ in the Condensed Consolidated Statements of Operations ($1.9 million for Industrials, $1.1 million for Energy and $(0.2) million for Medical). The following table summarizes the activity associated with the Company’s restructuring programs for the six month period ended June 30, 2019. Total Balance as of December 31, 2018 $ 10.1 Charged to expense - Termination benefits 2.4 Charged to expense - Other 0.4 Payments (7.0 ) Other, net (0.1 ) Balance as of June 30, 2019 $ 5.8 As of June 30, 2019, restructuring reserves of $5.8 million are included in “Accrued liabilities” in the Condensed Consolidated Balance Sheets. As of December 31, 2018, restructuring reserves of $10.1 million related to these programs were included in ‘‘Accrued liabilities’’ in the Consolidated Balance Sheets. |
Inventories
Inventories | 6 Months Ended |
Jun. 30, 2019 | |
Inventories [Abstract] | |
Inventories | Note 4. Inventories Inventories as of June 30, 2019 and December 31, 2018 consisted of the following. June 30, 2019 December 31, 2018 Raw materials, including parts and subassemblies $ 403.4 $ 369.2 Work-in-process 59.9 58.1 Finished goods 81.1 83.4 544.4 510.7 Excess of LIFO costs over FIFO costs 13.2 13.2 Inventories $ 557.6 $ 523.9 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2019 | |
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 six month period ended June 30, 2019 is presented in the table below. Industrials Energy Medical Total Balance as of December 31, 2018 $ 632.7 $ 453.6 $ 203.2 $ 1,289.5 Foreign currency translation and other (1) (2.2 ) (2.3 ) (0.1 ) (4.6 ) Balance as of June 30, 2019 $ 630.5 $ 451.3 $ 203.1 $ 1,284.9 (1) During the six month period ended June 30, 2019, the Company recorded an increase in goodwill of $0.2 million as a result of measurement period adjustments in the Industrials segment. As of June 30, 2019, goodwill included a total of $563.9 million of accumulated impairment losses within the Energy segment. There were no goodwill impairment charges recorded during the six month periods ended June 30, 2019 and 2018. Other intangible assets as of June 30, 2019 and December 31, 2018 consisted of the following. June 30, 2019 December 31, 2018 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Amortized intangible assets Customer lists and relationships $ 1,241.9 $ (620.9 ) $ 1,245.5 $ (567.8 ) Technology 21.5 (5.3 ) 21.7 (4.8 ) Trademarks 44.7 (14.6 ) 44.9 (13.0 ) Backlog 68.6 (68.6 ) 68.8 (68.6 ) Other 62.8 (36.7 ) 62.3 (31.9 ) Unamortized intangible assets Trademarks 610.4 — 611.3 — Total other intangible assets $ 2,049.9 $ (746.1 ) $ 2,054.5 $ (686.1 ) Amortization of intangible assets for the three and six month periods ended June 30, 2019 and 2018 were as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Intangible asset amortization expense $ 30.9 $ 31.5 $ 62.3 $ 62.4 Amortization of intangible assets is anticipated to be approximately $123.2 million annually in 2020 through 2024 based upon exchange rates as of June 30, 2019. |
Accrued Liabilities
Accrued Liabilities | 6 Months Ended |
Jun. 30, 2019 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | Note 6. Accrued Liabilities Accrued liabilities as of June 30, 2019 and December 31, 2018 consisted of the following. June 30, 2019 December 31, 2018 Salaries, wages and related fringe benefits $ 64.4 $ 62.9 Restructuring 5.8 10.1 Taxes 21.5 24.3 Contract liabilities 60.6 69.6 Product warranty 23.4 23.9 Accrued interest 0.7 0.3 Operating lease liabilities (1) 17.5 — Other 57.6 57.4 Total accrued liabilities $ 251.5 $ 248.5 (1) The Company adopted ASU 2016-02, Leases, A reconciliation of the changes in the accrued product warranty liability for the three and six month periods ended June 30, 2019 and 2018 are as follows. For the Three Month Period Ended June 30, 2019 For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2018 Balance at beginning of period $ 21.8 $ 24.3 $ 23.9 $ 22.3 Product warranty accruals 7.8 5.5 14.6 11.6 Settlements (6.3 ) (5.2 ) (15.1 ) (10.6 ) Charged to other accounts (1) 0.1 (0.7 ) — 0.6 Balance at end of period $ 23.4 $ 23.9 $ 23.4 $ 23.9 (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 | 6 Months Ended |
Jun. 30, 2019 | |
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 and six month periods ended June 30, 2019 and 2018. Pension Benefits Other Postretirement U.S. Plans Non-U.S. Plans Benefits For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 Service cost $ — $ — $ 0.4 $ 0.8 $ — $ — Interest cost 0.6 1.1 1.9 3.9 0.1 0.1 Expected return on plan assets (0.6 ) (1.1 ) (2.6 ) (5.2 ) — — Recognition of: Unrecognized prior service cost — — 0.1 0.1 — — Unrecognized net actuarial loss — 0.1 0.5 1.0 — — $ — $ 0.1 $ 0.3 $ 0.6 $ 0.1 $ 0.1 Pension Benefits Other Postretirement U.S. Plans Non-U.S. Plans Benefits For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2018 For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2018 For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2018 Service cost $ — $ — $ 0.4 $ 0.9 $ — $ — Interest cost 0.5 1.0 1.9 3.8 — 0.1 Expected return on plan assets (1.2 ) (2.3 ) (2.9 ) (5.9 ) — — Recognition of: Unrecognized prior service cost — — — — — — Unrecognized net actuarial loss — — 0.5 1.0 — — $ (0.7 ) $ (1.3 ) $ (0.1 ) $ (0.2 ) $ — $ 0.1 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 | 6 Months Ended |
Jun. 30, 2019 | |
Debt [Abstract] | |
Debt | Note 8. Debt Debt as of June 30, 2019 and December 31, 2018 is summarized as follows. June 30, 2019 December 31, 2018 Short-term borrowings $ — $ — Long-term debt: Revolving credit facility, due 2024 (1) $ — $ — Receivables financing agreement, due 2020 — — Term loan denominated in U.S. dollars, due 2024 (2) 927.6 952.6 Term loan denominated in Euros, due 2024 (3) 686.9 696.5 Capitalized leases and other long-term debt 26.0 26.3 Unamortized debt issuance costs (9.0 ) (3.3 ) Total long-term debt, net, including current maturities 1,631.5 1,672.1 Current maturities of long-term debt 8.0 7.9 Total long-term debt, net $ 1,623.5 $ 1,664.2 (1) On June 28, 2019, the Revolving Credit Facility’s maturity was extended to as part of the Amendment described within this Note. As of December 31, 2018, the maturity was . (2) As of June 30, 2019, the applicable interest rate was 5.15% and the weighted-average rate was 5.24% for the six month period ended June 30, 2019. (3) As of June 30, 2019, the applicable interest rate was 3.00% and the weighted-average rate was 3.00% for the six month period ended June 30, 2019. On June 28, 2019, the Company entered into Amendment No. 4 to the Credit Agreement, dated as of July 30, 2013 (as amended by Amendment No. 1 to the Credit Agreement, dated as of March 4, 2016, Amendment No. 2, dated as of August 17, 2017 and Amendment No. 3 dated as of December 13, 2018) with UBS AG, Stamford Branch, as Resigning Agent and Citibank, N.A. as Successor Agent. Amendment No. 4 (i) refinanced the existing senior secured revolving credit facility with a replacement $450.0 million senior secured revolving credit facility (the “New Revolving Credit Facility”); (ii) extended the maturity of the revolving credit facility to June 28, 2024, (iii) terminated the revolving credit facility commitments of certain lenders under the existing senior secured revolving credit facility under the Credit Agreement, (iv) provided for up to $200.0 million of the New Revolving Credit Facility to be available for the purpose of issuing letters of credit; (v) provided for the replacement of GD First (UK) Limited by Gardner Denver Holdings, Ltd. as the UK Borrower under the Amended Credit Agreement; (vi) transferred the Administrative Agent, Collateral Agent and Swingline Lender roles under the Amended Credit Agreement to Citibank, N.A; and (vii) made certain other corresponding technical changes and updates. At the consummation of the merger between Gardner Denver Holdings, Inc, and Ingersoll-Rand plc, Amendment No. 4 increases the aggregate amount of the New Revolving Credit Facility to $1,000.0 million and increases the capacity under the New Revolving Credit Facility to issue letters of credit to $400.0 million. Loans under the New Revolving Credit Facility will have an initial applicable margin of 2.25% for LIBOR loans and 1.25% for base rate loans. Amendment No. 4 resulted in the write-off of $0.2 million of debt issuance costs for the three and six month periods ended June 30, 2019. This was included in “Loss on extinguishment of debt” in the Condensed Consolidated Statements of Operations. As of June 30, 2019, the Company had no outstanding borrowings, $5.0 million of outstanding letters of credit under the New Revolving Credit Facility and unused availability of $445.0 million. In March 2019, the Company used excess cash to repay $25.0 million of principal on outstanding borrowings under the Dollar Term Loan Facility. As of June 30, 2019, the Company had no outstanding borrowings, $26.7 million of letters of credit outstanding and $76.4 million of capacity available under the Receivables Financing Agreement (“RFA”). |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2019 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | Note 9. Stock-Based Compensation The Company has outstanding stock-based compensation awards granted under the 2013 Stock Incentive Plan (“2013 Plan”) and the 2017 Omnibus Incentive Plan (“2017 Plan”) as described in Note 16, “Stock-Based Compensation Plans” to the consolidated financial statements in its annual report on Form 10-K for the year ended December 31, 2018. In the three and six month periods ended June 30, 2019, the Company recognized stock-based compensation expense of approximately $6.0 million and $13.6 million, respectively. The Company recognized stock-based compensation expense of approximately $1.8 million and $5.2 million for the three and six month periods ended June 30, 2018, respectively. These costs are included in “Other operating expense, net” in the Condensed Consolidated Statements of Operations. The $13.6 million of stock-based compensation expense for the six month period ended June 30, 2019 included expense of $0.7 million for the modification of a former employee’s equity awards, expense for equity awards granted under the 2013 Plan and 2017 Plan of $5.0 million and an increase in the liability for stock appreciation rights (“SAR”) of $7.9 million. The $0.7 million stock-based compensation expense for the modification incurred in the six month period ended June 30, 2019 provided continued vesting through scheduled vesting dates for certain awards of a former employee. As of June 30, 2019, there was $35.0 million of total unrecognized compensation expense related to outstanding stock options and restricted stock awards. SARs, granted under the 2013 Plan are expected to be settled in cash and are accounted for as liability awards. As of June 30, 2019, a liability of approximately $11.2 million for SARs was included in “Accrued liabilities” in the Condensed Consolidated Balance Sheets. Stock Option Awards A summary of the Company’s stock option (including SARs) activity for the six month period ended June 30, 2019 is presented in the following table (underlying shares in thousands). Shares Weighted-Average Exercise Price (per share) Outstanding as of December 31, 2018 12,352 $ 10.93 Granted 1,070 $ 27.05 Exercised or settled (3,890 ) $ 8.72 Forfeited (90 ) $ 30.42 Expired (9 ) $ 32.06 Outstanding as of June 30, 2019 9,433 $ 13.46 Vested as of June 30, 2019 7,266 $ 9.61 The following assumptions were used to estimate the fair value of options granted (excluding previously disclosed modified awards) during the six month periods ended June 30, 2019 and 2018 using the Black-Scholes option-pricing model. For the Six Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2018 Assumptions Expected life of options (in years) 6.3 7.0 - 7.5 Risk-free interest rate 2.4 - 2.6 % 2.9 - 3.0 % Assumed volatility 30.7 - 31.8 % 34.4 - 35.4 % Expected dividend rate 0.0% % 0.0% % Restricted Stock Unit Awards A summary of the Company’s restricted stock unit activity for the six month period ended June 30, 2019 is presented in the following table (underlying shares in thousands). Shares Weighted-Average Grant-Date Fair Value Non-vested as of December 31, 2018 362 $ 31.78 Granted 418 $ 27.05 Vested (33 ) $ 31.97 Forfeited (38 ) $ 31.56 Non-vested as of June 30, 2019 709 $ 28.97 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 6 Months Ended |
Jun. 30, 2019 | |
Accumulated Other Comprehensive (Loss) Income [Abstract] | |
Accumulated Other Comprehensive (Loss) Income | Note 10. Accumulated Other Comprehensive (Loss) Income The Company’s other comprehensive income (loss) 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. See Note 7 “Pension and Other Postretirement Benefits” and Note 11 “Hedging Activities and Fair Value Measurements.” The before tax income (loss) and related income tax effect are as follows. For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 Before-Tax Amount Tax Benefit or (Expense) Net of Tax Amount Before-Tax Amount Tax (Expense) or Benefit Net of Tax Amount Foreign currency translation adjustments, net $ (8.6 ) $ 2.2 $ (6.4 ) $ (4.1 ) $ (2.4 ) $ (6.5 ) Unrecognized (losses) gains on cash flow hedges, net (0.7 ) 0.2 (0.5 ) 0.6 0.8 1.4 Pension and other postretirement benefit prior service cost and gain or loss, net 1.3 (0.1 ) 1.2 1.5 (0.1 ) 1.4 Other comprehensive loss $ (8.0 ) $ 2.3 $ (5.7 ) $ (2.0 ) $ (1.7 ) $ (3.7 ) For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2018 Before-Tax Amount Tax (Expense) or Benefit Net of Tax Amount Before-Tax Amount Tax (Expense) or Benefit) Net of Tax Amount Foreign currency translation adjustments, net $ (58.1 ) $ (9.4 ) $ (67.5 ) $ (28.5 ) $ (4.6 ) $ (33.1 ) Unrecognized gains (losses) on cash flow hedges, net 6.2 (1.5 ) 4.7 21.3 (5.2 ) 16.1 Pension and other postretirement benefit prior service cost and gain or loss, net 3.3 (0.6 ) 2.7 2.1 1.0 3.1 Other comprehensive loss $ (48.6 ) $ (11.5 ) $ (60.1 ) $ (5.1 ) $ (8.8 ) $ (13.9 ) On January 1, 2019, the Company adopted ASU 2018-02 which reclassified stranded tax effects resulting from the Tax Cuts and Jobs Act from accumulated other comprehensive (loss) income to retained (deficit) earnings. The Company recorded a cumulative-effect adjustment which increased “Accumulated other comprehensive loss” in the Condensed Consolidated Balance Sheet by $8.2 million. Changes in accumulated other comprehensive (loss) income by component for the six month periods ended June 30, 2019 and 2018 are presented in the following table (1) . Foreign Currency Translation Adjustments, Net Unrealized (Losses) Gains on Cash Flow Hedges Pension and Postretirement Benefit Plans Total Balance as of December 31, 2018 $ (190.6 ) $ (11.4 ) $ (45.0 ) $ (247.0 ) Other comprehensive (loss) income before reclassifications (6.5 ) (4.4 ) 0.5 (10.4 ) Amounts reclassified from accumulated other comprehensive (loss) income — 5.8 0.9 6.7 Other comprehensive (loss) income (6.5 ) 1.4 1.4 (3.7 ) Cumulative effect adjustment upon adoption of new accounting standard (ASU 2018-02) (1.5 ) (6.7 ) — (8.2 ) Balance as of June 30, 2019 $ (198.6 ) $ (16.7 ) $ (43.6 ) $ (258.9 ) Foreign Currency Translation Adjustments, Net Unrealized (Losses) Gains on Cash Flow Hedges Pension and Postretirement Benefit Plans Total Balance as of December 31, 2017 $ (129.6 ) $ (29.8 ) $ (40.4 ) $ (199.8 ) Other comprehensive (loss) income before reclassifications (33.1 ) 10.1 2.3 (20.7 ) Amounts reclassified from accumulated other comprehensive (loss) income — 6.0 0.8 6.8 Other comprehensive (loss) income (33.1 ) 16.1 3.1 (13.9 ) Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) — 0.3 — 0.3 Balance as of June 30, 2018 $ (162.7 ) $ (13.4 ) $ (37.3 ) $ (213.4 ) (1) All amounts are net of tax. Amounts in parentheses indicate debits. Reclassifications out of accumulated other comprehensive (loss) income for the six month periods ended June 30, 2019 and 2018 are presented in the following table: Amount Reclassified from Accumulated Other Comprehensive (Loss) Income Details about Accumulated Other Comprehensive (Loss) Income Components For the Six Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2018 Affected Line in the Statement Where Net Income is Presented Loss on cash flow hedges Interest rate swaps $ 7.6 $ 7.9 Interest expense 7.6 7.9 Total before tax (1.8 ) (1.9 ) Benefit for income taxes $ 5.8 $ 6.0 Net of tax Amortization of defined benefit pension and other postretirement benefit items $ 1.2 $ 1.0 (1) 1.2 1.0 Total before tax (0.3 ) (0.2 ) Benefit for income taxes $ 0.9 $ 0.8 Net of tax Total reclassifications for the period $ 6.7 $ 6.8 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 | 6 Months Ended |
Jun. 30, 2019 | |
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 Renminbi 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 June 30, 2019 and December 31, 2018. June 30, 2019 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 $ 825.0 $ — $ — $ 7.4 $ 13.2 Derivatives Not Designated as Hedging Instruments Foreign currency forwards Fair Value $ 123.5 $ 0.8 $ — $ — $ — Foreign currency forwards Fair Value $ 71.8 $ — $ — $ 1.5 $ — December 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 Derivatives Designated as Hedging Instruments Interest rate swap contracts Cash Flow $ 925.0 $ — $ — $ 11.2 $ 8.7 Derivatives Not Designated as Hedging Instruments Foreign currency forwards Fair Value $ 143.3 $ 1.3 $ — $ — $ — Foreign currency forwards Fair Value $ 27.5 $ — $ — $ 0.1 $ — (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 Income for the three and six month periods ended June 30, 2019 and 2018 are as presented in the table below. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Interest rate swap contracts (Loss) gain recognized in AOCI on derivatives $ (4.6 ) $ 3.1 $ (7.0 ) $ 13.4 Loss reclassified from AOCI into income (effective portion) (1) (3.9 ) (3.1 ) (7.6 ) (7.9 ) (1) Losses on derivatives reclassified from accumulated other comprehensive income (“AOCI”) into income were included within “Interest expense” in the Condensed Consolidated Statements of Operations. As of June 30, 2019, the Company is the fixed rate payor on eight interest rate swap contracts that effectively fix the LIBOR-based index used to determine the interest rates charged on a total of $825.0 million of the Company’s LIBOR-based variable rate borrowings. These contracts carry fixed rates ranging from 3.3% to 4.3% and have expiration dates ranging from 2019 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 June 30, 2019, the Company expects to reclassify losses of $18.3 million out of AOCI into earnings during the next 12 months. The Company’s LIBOR-based variable rate borrowings outstanding as of June 30, 2019 were $927.6 million and €604.2 million. The Company had eight foreign currency forward contracts outstanding as of June 30, 2019 with notional amounts ranging from $7.6 million to $47.3 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 within “Other operating expense, net” in 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 and six month periods ended June 30, 2019 and 2018 were as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Foreign currency forward contracts (losses) gains $ (2.2 ) $ 7.3 $ (3.8 ) $ 6.2 Total foreign currency transaction (losses) gains, net (0.6 ) 2.4 (3.7 ) (0.2 ) 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 10 “Debt” to the consolidated financial statements in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2018. 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 June 30, 2019, the Euro Term Loan of €604.2 million remained designated. The Company’s (losses) and gains, net of income tax, associated with changes in the value of debt for the three and six month periods ended June 30, 2019 and 2018 and the net balance of such (losses) and gains included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018 were as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 (Loss) gain, net of income tax, recorded through other comprehensive income $ (7.0 ) $ 29.7 $ 4.7 $ 14.5 Balance included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018, respectively $ 61.3 $ 46.7 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 (an 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 June 30, 2019. Level 1 Level 2 Level 3 Total Financial Assets Foreign currency forwards (1) $ — $ 0.8 $ — $ 0.8 Trading securities held in deferred compensation plan (2) 6.5 — — 6.5 Total $ 6.5 $ 0.8 $ — $ 7.3 Financial Liabilities Foreign currency forwards (1) $ — $ 1.5 $ — $ 1.5 Interest rate swaps (3) — 20.6 — 20.6 Deferred compensation plan (2) 6.5 — — 6.5 Total $ 6.5 $ 22.1 $ — $ 28.6 (1) Based on calculations that use readily observable market parameters as 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 June 30, 2019. 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 | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contracts with Customers [Abstract] | |
Revenue from Contracts with Customers | Note 12. Revenue from Contracts with Customers Overview The Company recognizes revenue when the Company has satisfied its obligation and 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. Judgments impacting variable consideration related to material rebate and sales discount programs, and significant contracts containing liquidated damage clauses are governed by 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 engineered to order (‘‘ETO’’) 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 alternative use, assessment of contractual language regarding termination provisions, and estimation of total project costs are all significant judgments 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 government 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. Sales commissions are due at either collection of payment from customers or recognition of revenue. Applying the practical expedient from ASC 340-40-25-4, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs are included in ‘‘Selling and administrative expenses’’ in the Condensed Consolidated Statements of Operations. Disaggregation of Revenue The following tables provide disaggregated revenue by reportable segment for the three month periods ended June 30, 2019 and 2018. For the Three Month Period Ended June 30, 2019 Industrials Energy Medical Total Primary Geographic Markets United States $ 103.4 $ 140.1 $ 30.5 $ 274.0 Other Americas 25.8 20.0 0.3 46.1 Total Americas $ 129.2 $ 160.1 $ 30.8 $ 320.1 EMEA 155.8 25.9 27.6 209.3 Asia Pacific 49.3 36.8 13.6 99.7 Total $ 334.3 $ 222.8 $ 72.0 $ 629.1 Product Categories Original equipment (1) $ 231.0 $ 92.7 $ 70.3 $ 394.0 Aftermarket (2) 103.3 130.1 1.7 235.1 Total $ 334.3 $ 222.8 $ 72.0 $ 629.1 Pattern of Revenue Recognition Revenue recognized at point in time (3) $ 322.9 $ 202.8 $ 72.0 $ 597.7 Revenue recognized over time (4) 11.4 20.0 — 31.4 Total $ 334.3 $ 222.8 $ 72.0 $ 629.1 For the Three Month Period Ended June 30, 2018 Industrials Energy Medical Total Primary Geographic Markets United States $ 91.0 $ 173.1 $ 24.8 $ 288.9 Other Americas 17.0 28.1 0.5 45.6 Total Americas $ 108.0 $ 201.2 $ 25.3 $ 334.5 EMEA 164.6 45.2 27.8 237.6 Asia Pacific 56.1 26.7 13.3 96.1 Total $ 328.7 $ 273.1 $ 66.4 $ 668.2 Product Categories Original equipment (1) $ 225.6 $ 118.6 $ 64.2 $ 408.4 Aftermarket (2) 103.1 154.5 2.2 259.8 Total $ 328.7 $ 273.1 $ 66.4 $ 668.2 Pattern of Revenue Recognition Revenue recognized at point in time (3) $ 314.1 $ 258.9 $ 66.4 $ 639.4 Revenue recognized over time (4) 14.6 14.2 — 28.8 Total $ 328.7 $ 273.1 $ 66.4 $ 668.2 (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 the delivery of a significant volume of substantially similar products recognized over time as contractual performance obligations are completed. The following tables provide disaggregated revenue by reportable segment for the six month periods ended June 30, 2019 and 2018. For the Six Month Period Ended June 30, 2019 Industrials Energy Medical Total Primary Geographic Markets United States $ 202.1 $ 282.9 $ 58.2 $ 543.2 Other Americas 46.9 42.3 0.9 90.1 Total Americas $ 249.0 $ 325.2 $ 59.1 $ 633.3 EMEA 308.0 69.8 55.8 433.6 Asia Pacific 95.4 60.9 26.2 182.5 Total $ 652.4 $ 455.9 $ 141.1 $ 1,249.4 Product Categories Original equipment (1) $ 450.7 $ 181.5 $ 137.1 $ 769.3 Aftermarket (2) 201.7 274.4 4.0 480.1 Total $ 652.4 $ 455.9 $ 141.1 $ 1,249.4 Pattern of Revenue Recognition Revenue recognized at point in time (3) $ 630.4 $ 419.0 $ 141.1 $ 1,190.5 Revenue recognized over time (4) 22.0 36.9 — 58.9 Total $ 652.4 $ 455.9 $ 141.1 $ 1,249.4 For the Six Month Period Ended June 30, 2018 Industrials Energy Medical Total Primary Geographic Markets United States $ 181.4 $ 338.5 $ 46.1 $ 566.0 Other Americas 38.2 55.6 1.4 95.2 Total Americas $ 219.6 $ 394.1 $ 47.5 $ 661.2 EMEA 325.6 70.4 54.7 450.7 Asia Pacific 100.4 50.8 24.6 175.8 Total $ 645.6 $ 515.3 $ 126.8 $ 1,287.7 Product Categories Original equipment (1) $ 441.2 $ 210.0 $ 122.2 $ 773.4 Aftermarket (2) 204.4 305.3 4.6 514.3 Total $ 645.6 $ 515.3 $ 126.8 $ 1,287.7 Pattern of Revenue Recognition Revenue recognized at point in time (3) 621.6 $ 497.9 $ 126.8 $ 1,246.3 Revenue recognized over time (4) 24.0 17.4 — 41.4 Total $ 645.6 $ 515.3 $ 126.8 $ 1,287.7 (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 the 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 account for shipping and handling activities as fulfillment costs and not a separate performance obligation. If control transfers and related revenue is recognized for the related good before the shipping and handling activities occur, the related costs of those shipping and handling activities are accrued. 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 in ETO arrangements, 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 June 30, 2019, 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 $218.9 million in the next twelve months and $50.5 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 June 30, 2019 and December 31, 2018 presented in the Condensed Consolidated Balance Sheets. June 30, 2019 December 31, 2018 Accounts receivable $ 498.6 $ 525.4 Contract assets 26.0 19.6 Contract liabilities 60.6 69.6 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 | 6 Months Ended |
Jun. 30, 2019 | |
Income Taxes [Abstract] | |
Income Taxes | Note 13. Income Taxes The following table summarizes the Company’s provision for income taxes and effective income tax provision rate for the three and six month periods ended June 30, 2019 and 2018. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Income before income taxes $ 53.2 $ 77.5 $ 112.4 $ 143.4 Provision for income taxes $ 8.3 $ 17.2 $ 20.3 $ 40.7 Effective income tax provision rate 15.6 % 22.2 % 18.1 % 28.4 % The decrease in the provision for income taxes and decrease in the effective income tax provision rate for the three month period ended June 30, 2019 when compared to the same three month period of 2018 is primarily due to a decrease in the amount of earnings generated in countries with higher statutory tax rates and an increase in windfall tax benefits. The decrease in the provision for income taxes and decrease in the effective income tax provision rate for the six month period ended June 30, 2019 when compared to the same six month period of 2018 is primarily due to a decrease in the amount of earnings generated in countries with higher statutory rates, an increase in windfall tax benefits and the Transition tax imposed under the Tax Cuts and Jobs Act of 2017. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Leases | Note 14. Leases The Company adopted ASC 842 on January 1, 2019 using the optional transition method. See Note 1 “Condensed Consolidated Financial Statements” for further discussion of the adoption. The Company has operating and financing leases for real estate, vehicles, IT equipment, office equipment and production equipment. The Company determines if an arrangement is a lease and identifies the classification of the lease as a financing lease or an operating lease at inception. Operating leases are recorded as operating lease right-of-use assets (“ROU assets”) in “Other assets” and operating lease liabilities in “Accrued liabilities” and “Other liabilities” in the Condensed Consolidated Balance Sheets. Financing leases are recorded as financing ROUs in “Property, plant and equipment” and lease liabilities in “Short-term borrowings and current maturities of long-term debt” and “Long-term debt, less current maturities” in the Condensed Consolidated Balance Sheets. At the date of commencement, lease liabilities are recorded at the present value of the future minimum lease payments over the lease term. The lease term is equal to the initial term at commencement plus any renewal or extension options that the Company is reasonably certain will be exercised. ROU assets at the date of commencement are equal to the amount of the initial lease liability, the initial direct costs incurred by the Company and any prepaid lease payments less any incentives received. Subsequent to the commencement date, operating lease liabilities are recorded at the present value of unpaid lease payments discounted at a discount rate established at the commencement date. Due to the absence of an implicit rate in the Company’s lease contracts, an incremental borrowing rate is used in the determination of the present value of future lease payments. Incremental borrowing rates for a lease are based on the lease term, lease currency and the Company’s credit spread. Operating ROU assets are recorded as the beginning balance less accumulated amortization with accumulated amortization equaling the straight-lined lease expense less the periodic accretion of the lease liability using the effective interest rate method. Subsequent to the commencement date, financing lease liabilities are increased to reflect interest on the lease liability and decreased for principal lease payments made. The financing ROU asset is measured at cost less amortization expense and any accumulated impairment loss. Amortization expense is calculated on a straight-line basis over the lease term or remaining useful life. The Company’s lease terms allow for the extension or termination of its leases and accounts for the extension and termination when it is reasonably certain that the Company will exercise the option or terminate the lease. Reassessment of the lease term occurs when there is a significant event or a significant change in circumstances that is within the control of the Company that directly affects whether the Company is reasonably certain to exercise or not to exercise an option to extend or terminate the lease or to purchase the underlying asset. Contractual specifications and requirements may be modified. The Company considers contract modifications to exist when the modification includes a change to the contractual terms, scope of the lease or the consideration given. In the event that the right to use an additional asset is granted and the lease payments associated with the additional asset are commensurate with the ROU asset’s standalone price, the modification is accounted for as a separate contract and the original contract remains unchanged. In the event that a single lease is modified, the Company reassessed the classification of the modified lease as of the effective date of the modification based on the modified terms and accounts for initial direct costs, lease incentives and any other payments made to or by the Company in connection with the modification in the same manner that items would be accounted for in connection with a new lease. If there is an additional ROU asset included, the lease term is extended or reduced, or the consideration is the only change in the contract, the Company reallocates the remaining consideration in the contract and remeasures the lease liability using a discount rate determined at the effective date of the modification. The remeasured lease liability for the modified lease is an adjustment to the corresponding ROU asset and does not impact the Condensed Consolidated Statements of Operations. In the event of a full or partial termination, the carrying value of the ROU asset decreases on a basis proportionate to the full or partial termination and any difference between the reduction in the lease liability and the proportionate reduction of the ROU asset is recognized as a gain or loss at the effective date of the modification. The Company elected not to recognize short-term leases on its balance sheet and continues to expense such leases. The components of lease expense for the three and six month periods ended June 30, 2019 were as follows. For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 Operating lease cost $ 5.6 $ 11.0 Finance lease cost Amortization of right-of-use assets $ 0.3 $ 0.7 Interest on lease liabilities 0.4 0.8 Total finance lease cost $ 0.7 $ 1.5 Short-term lease cost $ 0.3 $ 0.5 Supplemental cash flow information related to leases was as follows. For the Six Month Period Ended June 30, 2019 Cash paid for amounts included in the measurement of leases Operating cash flows from operating leases $ 10.9 Operating cash flows from finance leases $ 0.8 Financing cash flows from finance leases $ 0.4 Supplemental balance sheet information related to leases was as follows. June 30, 2019 Operating leases Other assets $ 57.3 Accrued liabilities 17.5 Other liabilities 40.1 Total operating lease liabilities $ 57.6 Finance Leases Property, plant and equipment $ 24.6 Short-term borrowings and current maturities of long-term debt 1.0 Long-term debt, less current maturities 24.9 Total finance lease liabilities $ 25.9 Weighted Average Remaining Lease Term (in years) Operating leases 4.6 Finance leases 14.1 Weighted Average Discount Rate Operating leases 2.4 % Finance leases 6.3 % Maturities of lease liabilities as of June 30, 2019 were as follows. Operating Leases Finance Leases 2019 (excluding the six months ended June 30, 2019) $ 9.8 $ 1.3 2020 16.6 2.5 2021 11.7 2.6 2022 8.0 2.6 2023 5.3 2.7 Thereafter 9.2 28.8 Total lease payments $ 60.6 $ 40.5 Less imputed interest (3.0 ) (14.6 ) Total $ 57.6 $ 25.9 As of December 31, 2018, future minimum rental payments for operating leases for the five years subsequent to December 31, 2018 and thereafter were approximately $25.8 million, $19.5 million, $13.9 million, $7.7 million, $5.4 million and $9.4 million, respectively. As of December 31, 2018, future minimum rental payments for capital leases for the five years subsequent to December 31, 2018 and thereafter were approximately $0.8 million, $1.0 million, $1.1 million, $1.2 million, $1.4 million and $20.7 million. |
Supplemental Information
Supplemental Information | 6 Months Ended |
Jun. 30, 2019 | |
Supplemental Information [Abstract] | |
Supplemental Information | Note 15. Supplemental Information The components of “Other operating expense, net” for the three month and six month periods ended June 30, 2019 and 2018 were as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Other Operating Expense, Net Foreign currency transaction losses (gains), net $ 0.6 $ (2.4 ) $ 3.7 $ 0.2 Restructuring charges, net (1) 0.8 — 2.8 — Stock-based compensation (2) 7.1 (0.8 ) 16.4 1.9 Shareholder litigation settlement recoveries (3) — — (6.0 ) (4.5 ) Acquisition related expenses and non-cash charges (4) 17.1 2.9 18.7 5.9 Gains on asset disposals (0.4 ) — (0.3 ) (1.2 ) Other, net 0.1 0.9 1.1 2.6 Total other operating expense, net $ 25.3 $ 0.6 $ 36.4 $ 4.9 (1) See Note 3 “Restructuring.” (2) Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2019 of $6.0 million and $13.6 million, respectively, increased by $1.1 million and $2.8 million for the three month and six month periods ended June 30, 2019, respectively, due to costs associated with employer taxes. Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2018 of $1.8 million and $5.2 million, respectively, reduced by a $2.6 million and $3.3 million decrease in the estimated accrual for employer taxes for the three month and six month periods ended June 30, 2018, respectively, as a result of the achievement of employer tax caps in countries outside of the United States. (3) Represents an insurance recovery of the Company’s shareholder litigation settlement in 2014. (4) Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs), and non-cash charges and credits arising from fair value purchase accounting adjustments. |
Contingencies
Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Contingencies [Abstract] | |
Contingencies | Note 16. 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 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’’ in the Condensed Consolidated Balance Sheets include a total litigation reserve of $102.3 million and $105.8 million as of June 30, 2019 and December 31, 2018, respectively, with regards 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 $102.8 million and $103.0 million as of June 30, 2019 and December 31, 2018, respectively, which was included in ‘‘Other assets’’ in the Condensed Consolidated Balance Sheets. 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 $6.8 million and $6.9 million as of June 30, 2019 and December 31, 2018, respectively, on its Condensed Consolidated Balance Sheets 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 | 6 Months Ended |
Jun. 30, 2019 | |
Segment Results [Abstract] | |
Segment Results | Note 17. 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 Before Income Taxes for the three month and six month periods ended June 30, 2019 and 2018. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Revenue Industrials $ 334.3 $ 328.7 $ 652.4 $ 645.6 Energy 222.8 273.1 455.9 515.3 Medical 72.0 66.4 141.1 126.8 Total Revenue $ 629.1 $ 668.2 $ 1,249.4 $ 1,287.7 Segment Adjusted EBITDA Industrials $ 76.6 $ 71.1 $ 147.7 137.9 Energy 56.3 79.7 116.3 147.6 Medical 21.4 18.0 41.4 33.9 Total Segment Adjusted EBITDA $ 154.3 $ 168.8 $ 305.4 $ 319.4 Less items to reconcile Segment Adjusted EBITDA to Income Before Income Taxes: Corporate expenses not allocated to segments (1) $ 6.7 $ 7.2 $ 17.7 $ 9.6 Interest expense 22.4 26.1 44.8 52.1 Depreciation and amortization expense 44.4 45.3 89.9 90.2 Restructuring and related business transformation costs (2) 2.0 8.4 6.1 12.9 Acquisition related expenses and non-cash charges (3) 17.1 5.7 18.7 10.3 Expenses related to public stock offerings (4) — 0.5 — 1.9 Establish public company financial reporting compliance (5) — 1.1 0.6 1.9 Stock-based compensation (6) 7.1 (0.8 ) 16.4 1.9 Foreign currency transaction losses (gains), net 0.6 (2.4 ) 3.7 0.2 Loss on extinguishment of debt (7) 0.2 0.2 0.2 0.2 Shareholder litigation settlement recoveries (8) — — (6.0 ) (4.5 ) Other adjustments (9) 0.6 — 0.9 (0.7 ) Income Before Income Taxes $ 53.2 $ 77.5 $ 112.4 $ 143.4 (1) Includes insurance recoveries of asbestos legal fees of $5.6 million in the six month period ended June 30, 2018. (2) Restructuring and related business transformation costs consist of the following. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Restructuring charges $ 0.8 $ — $ 2.8 $ — Severance, sign-on, relocation and executive search costs 0.2 1.9 1.2 3.9 Facility reorganization, relocation and other costs 0.5 0.7 1.1 1.3 Information technology infrastructure transformation 0.4 0.2 0.7 0.2 Gains on asset disposals (0.4 ) — (0.3 ) (1.2 ) Consultant and other advisor fees 0.1 4.0 0.2 6.6 Other, net 0.4 1.6 0.4 2.1 Total restructuring and related business transformation costs $ 2.0 $ 8.4 $ 6.1 $ 12.9 (3) Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs) and non-cash charges and credits arising from fair value purchase accounting adjustments. (4) Represents certain expenses related to the Company’s secondary stock offerings. (5) Represents third party expenses to comply with the requirements of Sarbanes-Oxley and the accelerated adoption of the new accounting standards (ASC 606 - Revenue from Contracts with Customers Leases (6) Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2019 of $6.0 million and $13.6 million, respectively increased by $1.1 million and $2.8 million for the three month and six month periods ended June 30, 2019, respectively, Represents stock-based compensation expense recognized for the three month and six month decrease in the estimated accrual for employer taxes for the three month and six month periods ended June 30, 2018, respectively, as a result of the achievement of employer tax caps in countries outside of the United States. (7) Represents losses on extinguishment of a portion of the U.S. term loan and the amendment of the revolving credit facility. (8) Represents an insurance recovery of the Company’ shareholder litigation settlement in 2014. (9) Includes (i) effects of amortization of prior service costs and amortization of losses in pension and other postemployment (“OPEB”) expense, (ii) certain legal and compliance costs and (iii) other miscellaneous adjustments. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 18. Related Party Transactions Affiliates of KKR participated as a lender in the Company’s Senior Secured Credit Facilities. KKR held a position in the Euro Term Loan Facility of €48.2 million as of June 30, 2019. The Company entered into Amendment No. 4 to the Credit Agreement on June 28, 2019. See Note 8, “Debt” for further discussion of Amendment No 4. KKR Affiliates were a joint lead arranger and bookrunner of the Amendment. KKR Affiliates earned $ 0.4 million in structuring fees for the six month period ended June 30, 2019 for their involvement in the Amendment. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 19. Earnings Per Share The computations of basic and diluted earnings per share are as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Net income $ 44.9 $ 60.3 $ 92.1 $ 102.7 Average shares outstanding Basic 203.4 201.8 202.5 201.7 Diluted 208.9 209.6 208.4 209.8 Earnings per share Basic $ 0.22 $ 0.30 $ 0.45 $ 0.51 Diluted $ 0.21 $ 0.29 $ 0.44 $ 0.49 The DSUs described in Note 16, “Stock-Based Compensation Plans” to the consolidated financial statements in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2018 were considered outstanding shares for the purpose of computing basic earnings per share because they were issued solely upon the passage of time. For the three month periods ended June 30, 2019 and 2018, there were 1.8 million and 0.8 million anti-dilutive shares that were not included in the computation of diluted earnings per share. For the six month periods ended June 30, 2019 and 2018, there were 1.8 million and 0.8 million anti-dilutive shares that were not included in the computation of diluted earnings per share. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 20. Subsequent Events On July 8, 2019, Gardner Denver Holdings, Inc acquired Oina VV AB (“Oina”), a company specializing in customized pump solutions for liquid handling processes for use in medical, process and industrial applications, for $10.0 million from cash on hand. The revenues and operating income of Oina will be included in the Medical segment. |
Condensed Consolidated Financ_2
Condensed Consolidated Financial Statements (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
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, 2018 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 the Company’s audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the Securities and Exchange Commission (“SEC”). The results of operations for the interim periods ended June 30, 2019 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, May 2, 2018 and October 31, 2018, the Company completed secondary offerings of 25,300,000 shares, 30,533,478 and 20,000,000 shares, respectively, of common stock held by affiliates of Kohlberg Kravis Roberts & Co. L.P. (“KKR”). As a result of the secondary offerings, the Company is no longer considered a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange (“NYSE”). KKR owns 70,671,135 shares of common stock, or approximately 35% of the total outstanding common stock based on the number of shares outstanding as of June 30, 2019. |
Recently Adopted Accounting Standard Updates ("ASU") | Recently Adopted Accounting Standard Updates (“ASU”) ASU 2016-02, Leases (Topic 842) On January 1, 2019, the Company adopted Financial Accounting Standards Board (“FASB”) ASU 2016-02, Leases (Topic 842) an approximate an approximate ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income On January 1, 2019, the Company adopted FASB ASU 2018-02 , Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-14, Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40); Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract |
Business Combinations (Tables)
Business Combinations (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Business Combinations [Abstract] | |
Revenue and Operating Income (Loss) of Acquisitions | The following table summarizes the revenue and operating income (loss) of these acquisitions for the periods presented subsequent to their date of acquisition. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Revenue $ 29.2 $ 15.7 $ 55.0 $ 23.6 Operating income (loss) 4.6 (0.9 ) 6.6 (2.0 ) |
Restructuring (Tables)
Restructuring (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Restructuring [Abstract] | |
Activity Associated With Restructuring Programs | The following table summarizes the activity associated with the Company’s restructuring programs for the six month period ended June 30, 2019. Total Balance as of December 31, 2018 $ 10.1 Charged to expense - Termination benefits 2.4 Charged to expense - Other 0.4 Payments (7.0 ) Other, net (0.1 ) Balance as of June 30, 2019 $ 5.8 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Inventories [Abstract] | |
Inventories | Inventories as of June 30, 2019 and December 31, 2018 consisted of the following. June 30, 2019 December 31, 2018 Raw materials, including parts and subassemblies $ 403.4 $ 369.2 Work-in-process 59.9 58.1 Finished goods 81.1 83.4 544.4 510.7 Excess of LIFO costs over FIFO costs 13.2 13.2 Inventories $ 557.6 $ 523.9 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
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 six month period ended June 30, 2019 is presented in the table below. Industrials Energy Medical Total Balance as of December 31, 2018 $ 632.7 $ 453.6 $ 203.2 $ 1,289.5 Foreign currency translation and other (1) (2.2 ) (2.3 ) (0.1 ) (4.6 ) Balance as of June 30, 2019 $ 630.5 $ 451.3 $ 203.1 $ 1,284.9 (1) During the six month period ended June 30, 2019, the Company recorded an increase in goodwill of $0.2 million as a result of measurement period adjustments in the Industrials segment. |
Intangible Assets | Other intangible assets as of June 30, 2019 and December 31, 2018 consisted of the following. June 30, 2019 December 31, 2018 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Amortized intangible assets Customer lists and relationships $ 1,241.9 $ (620.9 ) $ 1,245.5 $ (567.8 ) Technology 21.5 (5.3 ) 21.7 (4.8 ) Trademarks 44.7 (14.6 ) 44.9 (13.0 ) Backlog 68.6 (68.6 ) 68.8 (68.6 ) Other 62.8 (36.7 ) 62.3 (31.9 ) Unamortized intangible assets Trademarks 610.4 — 611.3 — Total other intangible assets $ 2,049.9 $ (746.1 ) $ 2,054.5 $ (686.1 ) |
Amortization of Intangible Assets | Amortization of intangible assets for the three and six month periods ended June 30, 2019 and 2018 were as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Intangible asset amortization expense $ 30.9 $ 31.5 $ 62.3 $ 62.4 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Accrued Liabilities [Abstract] | |
Accrued Liabilities | Accrued liabilities as of June 30, 2019 and December 31, 2018 consisted of the following. June 30, 2019 December 31, 2018 Salaries, wages and related fringe benefits $ 64.4 $ 62.9 Restructuring 5.8 10.1 Taxes 21.5 24.3 Contract liabilities 60.6 69.6 Product warranty 23.4 23.9 Accrued interest 0.7 0.3 Operating lease liabilities (1) 17.5 — Other 57.6 57.4 Total accrued liabilities $ 251.5 $ 248.5 (1) The Company adopted ASU 2016-02, Leases, |
Accrued Product Warranty Liability | A reconciliation of the changes in the accrued product warranty liability for the three and six month periods ended June 30, 2019 and 2018 are as follows. For the Three Month Period Ended June 30, 2019 For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2018 Balance at beginning of period $ 21.8 $ 24.3 $ 23.9 $ 22.3 Product warranty accruals 7.8 5.5 14.6 11.6 Settlements (6.3 ) (5.2 ) (15.1 ) (10.6 ) Charged to other accounts (1) 0.1 (0.7 ) — 0.6 Balance at end of period $ 23.4 $ 23.9 $ 23.4 $ 23.9 (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 Postretirem_2
Pension and Other Postretirement Benefits (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
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 and six month periods ended June 30, 2019 and 2018. Pension Benefits Other Postretirement U.S. Plans Non-U.S. Plans Benefits For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 Service cost $ — $ — $ 0.4 $ 0.8 $ — $ — Interest cost 0.6 1.1 1.9 3.9 0.1 0.1 Expected return on plan assets (0.6 ) (1.1 ) (2.6 ) (5.2 ) — — Recognition of: Unrecognized prior service cost — — 0.1 0.1 — — Unrecognized net actuarial loss — 0.1 0.5 1.0 — — $ — $ 0.1 $ 0.3 $ 0.6 $ 0.1 $ 0.1 Pension Benefits Other Postretirement U.S. Plans Non-U.S. Plans Benefits For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2018 For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2018 For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2018 Service cost $ — $ — $ 0.4 $ 0.9 $ — $ — Interest cost 0.5 1.0 1.9 3.8 — 0.1 Expected return on plan assets (1.2 ) (2.3 ) (2.9 ) (5.9 ) — — Recognition of: Unrecognized prior service cost — — — — — — Unrecognized net actuarial loss — — 0.5 1.0 — — $ (0.7 ) $ (1.3 ) $ (0.1 ) $ (0.2 ) $ — $ 0.1 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt [Abstract] | |
Debt | Debt as of June 30, 2019 and December 31, 2018 is summarized as follows. June 30, 2019 December 31, 2018 Short-term borrowings $ — $ — Long-term debt: Revolving credit facility, due 2024 (1) $ — $ — Receivables financing agreement, due 2020 — — Term loan denominated in U.S. dollars, due 2024 (2) 927.6 952.6 Term loan denominated in Euros, due 2024 (3) 686.9 696.5 Capitalized leases and other long-term debt 26.0 26.3 Unamortized debt issuance costs (9.0 ) (3.3 ) Total long-term debt, net, including current maturities 1,631.5 1,672.1 Current maturities of long-term debt 8.0 7.9 Total long-term debt, net $ 1,623.5 $ 1,664.2 (1) On June 28, 2019, the Revolving Credit Facility’s maturity was extended to as part of the Amendment described within this Note. As of December 31, 2018, the maturity was . (2) As of June 30, 2019, the applicable interest rate was 5.15% and the weighted-average rate was 5.24% for the six month period ended June 30, 2019. (3) As of June 30, 2019, the applicable interest rate was 3.00% and the weighted-average rate was 3.00% for the six month period ended June 30, 2019. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Award Plan Activity | A summary of the Company’s stock option (including SARs) activity for the six month period ended June 30, 2019 is presented in the following table (underlying shares in thousands). Shares Weighted-Average Exercise Price (per share) Outstanding as of December 31, 2018 12,352 $ 10.93 Granted 1,070 $ 27.05 Exercised or settled (3,890 ) $ 8.72 Forfeited (90 ) $ 30.42 Expired (9 ) $ 32.06 Outstanding as of June 30, 2019 9,433 $ 13.46 Vested as of June 30, 2019 7,266 $ 9.61 |
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 six month periods ended June 30, 2019 and 2018 using the Black-Scholes option-pricing model. For the Six Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2018 Assumptions Expected life of options (in years) 6.3 7.0 - 7.5 Risk-free interest rate 2.4 - 2.6 % 2.9 - 3.0 % Assumed volatility 30.7 - 31.8 % 34.4 - 35.4 % Expected dividend rate 0.0% % 0.0% % |
Restricted Stock Unit Activity | A summary of the Company’s restricted stock unit activity for the six month period ended June 30, 2019 is presented in the following table (underlying shares in thousands). Shares Weighted-Average Grant-Date Fair Value Non-vested as of December 31, 2018 362 $ 31.78 Granted 418 $ 27.05 Vested (33 ) $ 31.97 Forfeited (38 ) $ 31.56 Non-vested as of June 30, 2019 709 $ 28.97 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive (Loss) Income (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
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 June 30, 2019 For the Six Month Period Ended June 30, 2019 Before-Tax Amount Tax Benefit or (Expense) Net of Tax Amount Before-Tax Amount Tax (Expense) or Benefit Net of Tax Amount Foreign currency translation adjustments, net $ (8.6 ) $ 2.2 $ (6.4 ) $ (4.1 ) $ (2.4 ) $ (6.5 ) Unrecognized (losses) gains on cash flow hedges, net (0.7 ) 0.2 (0.5 ) 0.6 0.8 1.4 Pension and other postretirement benefit prior service cost and gain or loss, net 1.3 (0.1 ) 1.2 1.5 (0.1 ) 1.4 Other comprehensive loss $ (8.0 ) $ 2.3 $ (5.7 ) $ (2.0 ) $ (1.7 ) $ (3.7 ) For the Three Month Period Ended June 30, 2018 For the Six Month Period Ended June 30, 2018 Before-Tax Amount Tax (Expense) or Benefit Net of Tax Amount Before-Tax Amount Tax (Expense) or Benefit) Net of Tax Amount Foreign currency translation adjustments, net $ (58.1 ) $ (9.4 ) $ (67.5 ) $ (28.5 ) $ (4.6 ) $ (33.1 ) Unrecognized gains (losses) on cash flow hedges, net 6.2 (1.5 ) 4.7 21.3 (5.2 ) 16.1 Pension and other postretirement benefit prior service cost and gain or loss, net 3.3 (0.6 ) 2.7 2.1 1.0 3.1 Other comprehensive loss $ (48.6 ) $ (11.5 ) $ (60.1 ) $ (5.1 ) $ (8.8 ) $ (13.9 ) |
Changes in Accumulated Other Comprehensive (Loss) Income | On January 1, 2019, the Company adopted ASU 2018-02 which reclassified stranded tax effects resulting from the Tax Cuts and Jobs Act from accumulated other comprehensive (loss) income to retained (deficit) earnings. The Company recorded a cumulative-effect adjustment which increased “Accumulated other comprehensive loss” in the Condensed Consolidated Balance Sheet by $8.2 million. Changes in accumulated other comprehensive (loss) income by component for the six month periods ended June 30, 2019 and 2018 are presented in the following table (1) . Foreign Currency Translation Adjustments, Net Unrealized (Losses) Gains on Cash Flow Hedges Pension and Postretirement Benefit Plans Total Balance as of December 31, 2018 $ (190.6 ) $ (11.4 ) $ (45.0 ) $ (247.0 ) Other comprehensive (loss) income before reclassifications (6.5 ) (4.4 ) 0.5 (10.4 ) Amounts reclassified from accumulated other comprehensive (loss) income — 5.8 0.9 6.7 Other comprehensive (loss) income (6.5 ) 1.4 1.4 (3.7 ) Cumulative effect adjustment upon adoption of new accounting standard (ASU 2018-02) (1.5 ) (6.7 ) — (8.2 ) Balance as of June 30, 2019 $ (198.6 ) $ (16.7 ) $ (43.6 ) $ (258.9 ) Foreign Currency Translation Adjustments, Net Unrealized (Losses) Gains on Cash Flow Hedges Pension and Postretirement Benefit Plans Total Balance as of December 31, 2017 $ (129.6 ) $ (29.8 ) $ (40.4 ) $ (199.8 ) Other comprehensive (loss) income before reclassifications (33.1 ) 10.1 2.3 (20.7 ) Amounts reclassified from accumulated other comprehensive (loss) income — 6.0 0.8 6.8 Other comprehensive (loss) income (33.1 ) 16.1 3.1 (13.9 ) Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) — 0.3 — 0.3 Balance as of June 30, 2018 $ (162.7 ) $ (13.4 ) $ (37.3 ) $ (213.4 ) (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 six month periods ended June 30, 2019 and 2018 are presented in the following table: Amount Reclassified from Accumulated Other Comprehensive (Loss) Income Details about Accumulated Other Comprehensive (Loss) Income Components For the Six Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2018 Affected Line in the Statement Where Net Income is Presented Loss on cash flow hedges Interest rate swaps $ 7.6 $ 7.9 Interest expense 7.6 7.9 Total before tax (1.8 ) (1.9 ) Benefit for income taxes $ 5.8 $ 6.0 Net of tax Amortization of defined benefit pension and other postretirement benefit items $ 1.2 $ 1.0 (1) 1.2 1.0 Total before tax (0.3 ) (0.2 ) Benefit for income taxes $ 0.9 $ 0.8 Net of tax Total reclassifications for the period $ 6.7 $ 6.8 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 V_2
Hedging Activities and Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Hedging Activities and Fair Value Measurements [Abstract] | |
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 June 30, 2019 and December 31, 2018. June 30, 2019 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 $ 825.0 $ — $ — $ 7.4 $ 13.2 Derivatives Not Designated as Hedging Instruments Foreign currency forwards Fair Value $ 123.5 $ 0.8 $ — $ — $ — Foreign currency forwards Fair Value $ 71.8 $ — $ — $ 1.5 $ — December 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 Derivatives Designated as Hedging Instruments Interest rate swap contracts Cash Flow $ 925.0 $ — $ — $ 11.2 $ 8.7 Derivatives Not Designated as Hedging Instruments Foreign currency forwards Fair Value $ 143.3 $ 1.3 $ — $ — $ — Foreign currency forwards Fair Value $ 27.5 $ — $ — $ 0.1 $ — (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 Income for the three and six month periods ended June 30, 2019 and 2018 are as presented in the table below. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Interest rate swap contracts (Loss) gain recognized in AOCI on derivatives $ (4.6 ) $ 3.1 $ (7.0 ) $ 13.4 Loss reclassified from AOCI into income (effective portion) (1) (3.9 ) (3.1 ) (7.6 ) (7.9 ) (1) Losses on derivatives reclassified from accumulated other comprehensive income (“AOCI”) into income were included within “Interest expense” in the Condensed Consolidated Statements of Operations. |
Losses on Derivative Instruments Not Designated as Accounting Hedges and Total Net Foreign Currency Losses | The Company’s (losses) gains on derivative instruments not designated as accounting hedges and total net foreign currency (losses) gains for the three and six month periods ended June 30, 2019 and 2018 were as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Foreign currency forward contracts (losses) gains $ (2.2 ) $ 7.3 $ (3.8 ) $ 6.2 Total foreign currency transaction (losses) gains, net (0.6 ) 2.4 (3.7 ) (0.2 ) |
Changes in Value of Debt and Designated Interest Rate Swaps | The Company’s (losses) and gains, net of income tax, associated with changes in the value of debt for the three and six month periods ended June 30, 2019 and 2018 and the net balance of such (losses) and gains included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018 were as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 (Loss) gain, net of income tax, recorded through other comprehensive income $ (7.0 ) $ 29.7 $ 4.7 $ 14.5 Balance included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018, respectively $ 61.3 $ 46.7 |
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 June 30, 2019. Level 1 Level 2 Level 3 Total Financial Assets Foreign currency forwards (1) $ — $ 0.8 $ — $ 0.8 Trading securities held in deferred compensation plan (2) 6.5 — — 6.5 Total $ 6.5 $ 0.8 $ — $ 7.3 Financial Liabilities Foreign currency forwards (1) $ — $ 1.5 $ — $ 1.5 Interest rate swaps (3) — 20.6 — 20.6 Deferred compensation plan (2) 6.5 — — 6.5 Total $ 6.5 $ 22.1 $ — $ 28.6 (1) Based on calculations that use readily observable market parameters as 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 June 30, 2019. 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 C_2
Revenue from Contracts with Customers (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Revenue from Contracts with Customers [Abstract] | |
Disaggregation of Revenue | The following tables provide disaggregated revenue by reportable segment for the three month periods ended June 30, 2019 and 2018. For the Three Month Period Ended June 30, 2019 Industrials Energy Medical Total Primary Geographic Markets United States $ 103.4 $ 140.1 $ 30.5 $ 274.0 Other Americas 25.8 20.0 0.3 46.1 Total Americas $ 129.2 $ 160.1 $ 30.8 $ 320.1 EMEA 155.8 25.9 27.6 209.3 Asia Pacific 49.3 36.8 13.6 99.7 Total $ 334.3 $ 222.8 $ 72.0 $ 629.1 Product Categories Original equipment (1) $ 231.0 $ 92.7 $ 70.3 $ 394.0 Aftermarket (2) 103.3 130.1 1.7 235.1 Total $ 334.3 $ 222.8 $ 72.0 $ 629.1 Pattern of Revenue Recognition Revenue recognized at point in time (3) $ 322.9 $ 202.8 $ 72.0 $ 597.7 Revenue recognized over time (4) 11.4 20.0 — 31.4 Total $ 334.3 $ 222.8 $ 72.0 $ 629.1 For the Three Month Period Ended June 30, 2018 Industrials Energy Medical Total Primary Geographic Markets United States $ 91.0 $ 173.1 $ 24.8 $ 288.9 Other Americas 17.0 28.1 0.5 45.6 Total Americas $ 108.0 $ 201.2 $ 25.3 $ 334.5 EMEA 164.6 45.2 27.8 237.6 Asia Pacific 56.1 26.7 13.3 96.1 Total $ 328.7 $ 273.1 $ 66.4 $ 668.2 Product Categories Original equipment (1) $ 225.6 $ 118.6 $ 64.2 $ 408.4 Aftermarket (2) 103.1 154.5 2.2 259.8 Total $ 328.7 $ 273.1 $ 66.4 $ 668.2 Pattern of Revenue Recognition Revenue recognized at point in time (3) $ 314.1 $ 258.9 $ 66.4 $ 639.4 Revenue recognized over time (4) 14.6 14.2 — 28.8 Total $ 328.7 $ 273.1 $ 66.4 $ 668.2 (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 the delivery of a significant volume of substantially similar products recognized over time as contractual performance obligations are completed. The following tables provide disaggregated revenue by reportable segment for the six month periods ended June 30, 2019 and 2018. For the Six Month Period Ended June 30, 2019 Industrials Energy Medical Total Primary Geographic Markets United States $ 202.1 $ 282.9 $ 58.2 $ 543.2 Other Americas 46.9 42.3 0.9 90.1 Total Americas $ 249.0 $ 325.2 $ 59.1 $ 633.3 EMEA 308.0 69.8 55.8 433.6 Asia Pacific 95.4 60.9 26.2 182.5 Total $ 652.4 $ 455.9 $ 141.1 $ 1,249.4 Product Categories Original equipment (1) $ 450.7 $ 181.5 $ 137.1 $ 769.3 Aftermarket (2) 201.7 274.4 4.0 480.1 Total $ 652.4 $ 455.9 $ 141.1 $ 1,249.4 Pattern of Revenue Recognition Revenue recognized at point in time (3) $ 630.4 $ 419.0 $ 141.1 $ 1,190.5 Revenue recognized over time (4) 22.0 36.9 — 58.9 Total $ 652.4 $ 455.9 $ 141.1 $ 1,249.4 For the Six Month Period Ended June 30, 2018 Industrials Energy Medical Total Primary Geographic Markets United States $ 181.4 $ 338.5 $ 46.1 $ 566.0 Other Americas 38.2 55.6 1.4 95.2 Total Americas $ 219.6 $ 394.1 $ 47.5 $ 661.2 EMEA 325.6 70.4 54.7 450.7 Asia Pacific 100.4 50.8 24.6 175.8 Total $ 645.6 $ 515.3 $ 126.8 $ 1,287.7 Product Categories Original equipment (1) $ 441.2 $ 210.0 $ 122.2 $ 773.4 Aftermarket (2) 204.4 305.3 4.6 514.3 Total $ 645.6 $ 515.3 $ 126.8 $ 1,287.7 Pattern of Revenue Recognition Revenue recognized at point in time (3) 621.6 $ 497.9 $ 126.8 $ 1,246.3 Revenue recognized over time (4) 24.0 17.4 — 41.4 Total $ 645.6 $ 515.3 $ 126.8 $ 1,287.7 (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 the 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 June 30, 2019 and December 31, 2018 presented in the Condensed Consolidated Balance Sheets. June 30, 2019 December 31, 2018 Accounts receivable $ 498.6 $ 525.4 Contract assets 26.0 19.6 Contract liabilities 60.6 69.6 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Income Taxes [Abstract] | |
Provision for Income Taxes and Effective Income Tax Rate | The following table summarizes the Company’s provision for income taxes and effective income tax provision rate for the three and six month periods ended June 30, 2019 and 2018. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Income before income taxes $ 53.2 $ 77.5 $ 112.4 $ 143.4 Provision for income taxes $ 8.3 $ 17.2 $ 20.3 $ 40.7 Effective income tax provision rate 15.6 % 22.2 % 18.1 % 28.4 % |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Leases [Abstract] | |
Components of Lease Expense | The components of lease expense for the three and six month periods ended June 30, 2019 were as follows. For the Three Month Period Ended June 30, 2019 For the Six Month Period Ended June 30, 2019 Operating lease cost $ 5.6 $ 11.0 Finance lease cost Amortization of right-of-use assets $ 0.3 $ 0.7 Interest on lease liabilities 0.4 0.8 Total finance lease cost $ 0.7 $ 1.5 Short-term lease cost $ 0.3 $ 0.5 |
Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases was as follows. For the Six Month Period Ended June 30, 2019 Cash paid for amounts included in the measurement of leases Operating cash flows from operating leases $ 10.9 Operating cash flows from finance leases $ 0.8 Financing cash flows from finance leases $ 0.4 |
Supplemental Balance Sheet Information Related to Leases | Supplemental balance sheet information related to leases was as follows. June 30, 2019 Operating leases Other assets $ 57.3 Accrued liabilities 17.5 Other liabilities 40.1 Total operating lease liabilities $ 57.6 Finance Leases Property, plant and equipment $ 24.6 Short-term borrowings and current maturities of long-term debt 1.0 Long-term debt, less current maturities 24.9 Total finance lease liabilities $ 25.9 Weighted Average Remaining Lease Term (in years) Operating leases 4.6 Finance leases 14.1 Weighted Average Discount Rate Operating leases 2.4 % Finance leases 6.3 % |
Maturities of Lease Liabilities | Maturities of lease liabilities as of June 30, 2019 were as follows. Operating Leases Finance Leases 2019 (excluding the six months ended June 30, 2019) $ 9.8 $ 1.3 2020 16.6 2.5 2021 11.7 2.6 2022 8.0 2.6 2023 5.3 2.7 Thereafter 9.2 28.8 Total lease payments $ 60.6 $ 40.5 Less imputed interest (3.0 ) (14.6 ) Total $ 57.6 $ 25.9 |
Supplemental Information (Table
Supplemental Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Supplemental Information [Abstract] | |
Other Operating Expense, Net | The components of “Other operating expense, net” for the three month and six month periods ended June 30, 2019 and 2018 were as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Other Operating Expense, Net Foreign currency transaction losses (gains), net $ 0.6 $ (2.4 ) $ 3.7 $ 0.2 Restructuring charges, net (1) 0.8 — 2.8 — Stock-based compensation (2) 7.1 (0.8 ) 16.4 1.9 Shareholder litigation settlement recoveries (3) — — (6.0 ) (4.5 ) Acquisition related expenses and non-cash charges (4) 17.1 2.9 18.7 5.9 Gains on asset disposals (0.4 ) — (0.3 ) (1.2 ) Other, net 0.1 0.9 1.1 2.6 Total other operating expense, net $ 25.3 $ 0.6 $ 36.4 $ 4.9 (1) See Note 3 “Restructuring.” (2) Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2019 of $6.0 million and $13.6 million, respectively, increased by $1.1 million and $2.8 million for the three month and six month periods ended June 30, 2019, respectively, due to costs associated with employer taxes. Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2018 of $1.8 million and $5.2 million, respectively, reduced by a $2.6 million and $3.3 million decrease in the estimated accrual for employer taxes for the three month and six month periods ended June 30, 2018, respectively, as a result of the achievement of employer tax caps in countries outside of the United States. (3) Represents an insurance recovery of the Company’s shareholder litigation settlement in 2014. (4) Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs), and non-cash charges and credits arising from fair value purchase accounting adjustments. |
Segment Results (Tables)
Segment Results (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
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 Before Income Taxes for the three month and six month periods ended June 30, 2019 and 2018. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Revenue Industrials $ 334.3 $ 328.7 $ 652.4 $ 645.6 Energy 222.8 273.1 455.9 515.3 Medical 72.0 66.4 141.1 126.8 Total Revenue $ 629.1 $ 668.2 $ 1,249.4 $ 1,287.7 Segment Adjusted EBITDA Industrials $ 76.6 $ 71.1 $ 147.7 137.9 Energy 56.3 79.7 116.3 147.6 Medical 21.4 18.0 41.4 33.9 Total Segment Adjusted EBITDA $ 154.3 $ 168.8 $ 305.4 $ 319.4 Less items to reconcile Segment Adjusted EBITDA to Income Before Income Taxes: Corporate expenses not allocated to segments (1) $ 6.7 $ 7.2 $ 17.7 $ 9.6 Interest expense 22.4 26.1 44.8 52.1 Depreciation and amortization expense 44.4 45.3 89.9 90.2 Restructuring and related business transformation costs (2) 2.0 8.4 6.1 12.9 Acquisition related expenses and non-cash charges (3) 17.1 5.7 18.7 10.3 Expenses related to public stock offerings (4) — 0.5 — 1.9 Establish public company financial reporting compliance (5) — 1.1 0.6 1.9 Stock-based compensation (6) 7.1 (0.8 ) 16.4 1.9 Foreign currency transaction losses (gains), net 0.6 (2.4 ) 3.7 0.2 Loss on extinguishment of debt (7) 0.2 0.2 0.2 0.2 Shareholder litigation settlement recoveries (8) — — (6.0 ) (4.5 ) Other adjustments (9) 0.6 — 0.9 (0.7 ) Income Before Income Taxes $ 53.2 $ 77.5 $ 112.4 $ 143.4 (1) Includes insurance recoveries of asbestos legal fees of $5.6 million in the six month period ended June 30, 2018. (2) Restructuring and related business transformation costs consist of the following. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Restructuring charges $ 0.8 $ — $ 2.8 $ — Severance, sign-on, relocation and executive search costs 0.2 1.9 1.2 3.9 Facility reorganization, relocation and other costs 0.5 0.7 1.1 1.3 Information technology infrastructure transformation 0.4 0.2 0.7 0.2 Gains on asset disposals (0.4 ) — (0.3 ) (1.2 ) Consultant and other advisor fees 0.1 4.0 0.2 6.6 Other, net 0.4 1.6 0.4 2.1 Total restructuring and related business transformation costs $ 2.0 $ 8.4 $ 6.1 $ 12.9 (3) Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs) and non-cash charges and credits arising from fair value purchase accounting adjustments. (4) Represents certain expenses related to the Company’s secondary stock offerings. (5) Represents third party expenses to comply with the requirements of Sarbanes-Oxley and the accelerated adoption of the new accounting standards (ASC 606 - Revenue from Contracts with Customers Leases (6) Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2019 of $6.0 million and $13.6 million, respectively increased by $1.1 million and $2.8 million for the three month and six month periods ended June 30, 2019, respectively, Represents stock-based compensation expense recognized for the three month and six month decrease in the estimated accrual for employer taxes for the three month and six month periods ended June 30, 2018, respectively, as a result of the achievement of employer tax caps in countries outside of the United States. (7) Represents losses on extinguishment of a portion of the U.S. term loan and the amendment of the revolving credit facility. (8) Represents an insurance recovery of the Company’ shareholder litigation settlement in 2014. (9) Includes (i) effects of amortization of prior service costs and amortization of losses in pension and other postemployment (“OPEB”) expense, (ii) certain legal and compliance costs and (iii) other miscellaneous adjustments. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Earning per Share | The computations of basic and diluted earnings per share are as follows. For the Three Month Period Ended June 30, For the Six Month Period Ended June 30, 2019 2018 2019 2018 Net income $ 44.9 $ 60.3 $ 92.1 $ 102.7 Average shares outstanding Basic 203.4 201.8 202.5 201.7 Diluted 208.9 209.6 208.4 209.8 Earnings per share Basic $ 0.22 $ 0.30 $ 0.45 $ 0.51 Diluted $ 0.21 $ 0.29 $ 0.44 $ 0.49 |
Condensed Consolidated Financ_3
Condensed Consolidated Financial Statements, Basis of Presentation (Details) - Common Stock [Member] - shares | Oct. 31, 2018 | May 02, 2018 | Nov. 15, 2017 | May 31, 2017 | Jun. 30, 2019 |
Stock Issued or Granted During Period [Abstract] | |||||
Stock sold in initial public offering (in shares) | 47,495,000 | ||||
Kohlberg Kravis Roberts & Co. L.P [Member] | |||||
Stock Issued or Granted During Period [Abstract] | |||||
Stock sold in initial public offering (in shares) | 20,000,000 | 30,533,478 | 25,300,000 | ||
Number of shares owned by non-controlling owners (in shares) | 70,671,135 | ||||
Ownership percentage by non-controlling owners | 35.00% |
Condensed Consolidated Financ_4
Condensed Consolidated Financial Statements, Accounting Standards Updates (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
New Accounting Pronouncements [Abstract] | ||||
Right to use asset | $ 57.3 | |||
Operating lease liability | 57.6 | |||
ASU 2016-02 [Member] | ||||
New Accounting Pronouncements [Abstract] | ||||
Right to use asset | 61.3 | |||
Operating lease liability | $ 61.4 | |||
ASU 2018-02 [Member] | Accumulated Deficit [Member] | ||||
New Accounting Pronouncements [Abstract] | ||||
Cumulative effect adjustment | $ 8.2 | $ 0 | ||
ASU 2018-02 [Member] | Accumulated Other Comprehensive Loss [Member] | ||||
New Accounting Pronouncements [Abstract] | ||||
Cumulative effect adjustment | $ (8.2) | [1] | $ 0 | |
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Millions | Apr. 30, 2019 | Dec. 12, 2018 | Nov. 02, 2018 | May 29, 2018 | Feb. 08, 2018 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Business Combinations [Abstract] | ||||||||||||||
Net cash paid to acquire business | $ 0.5 | $ 113.6 | ||||||||||||
Goodwill | $ 1,284.9 | $ 1,289.5 | 1,284.9 | |||||||||||
Revenues and Operating Income (Loss) [Abstract] | ||||||||||||||
Revenue | 29.2 | $ 15.7 | 55 | 23.6 | ||||||||||
Operating income (loss) | 4.6 | $ (0.9) | 6.6 | $ (2) | ||||||||||
MP Pumps, Inc. [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Total consideration | $ 58.5 | |||||||||||||
Cash consideration | 57.8 | |||||||||||||
Purchase price adjustment | 0.1 | 0.2 | ||||||||||||
Holdback recorded in accrued liabilities | 0.6 | 0.5 | 0.5 | |||||||||||
Net cash paid to acquire business | 0.5 | |||||||||||||
Goodwill deductible for tax purposes | $ 0 | |||||||||||||
DV Systems Inc [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Total consideration | $ 16.1 | |||||||||||||
Cash consideration | 14.8 | |||||||||||||
Increase in total consideration | $ 0.1 | |||||||||||||
Purchase price adjustment | $ 0.1 | |||||||||||||
Holdback recorded in accrued liabilities | 1.3 | |||||||||||||
Goodwill deductible for tax purposes | $ 0 | |||||||||||||
DV Systems Inc [Member] | Accrued Liabilities [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Holdback recorded in accrued liabilities | 0.9 | 0.9 | ||||||||||||
DV Systems Inc [Member] | Other Liabilities [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Holdback recorded in accrued liabilities | 0.5 | 0.5 | ||||||||||||
DV Systems Inc [Member] | Forecast [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Holdback recorded in accrued liabilities | $ 0.5 | $ 0.5 | $ 0.4 | |||||||||||
PMI Pump Parts [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Total consideration | $ 21 | |||||||||||||
Cash consideration | 18.8 | |||||||||||||
Contingent consideration payments | $ 1 | |||||||||||||
Promissory note | 2 | $ 1 | $ 1 | |||||||||||
Holdback recorded in accrued liabilities | 0.2 | |||||||||||||
Goodwill deductible for tax purposes | $ 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 | |||||||||||||
Ingersoll Rand [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Cash consideration | $ 1,900 | |||||||||||||
Percentage interest acquired | 50.10% |
Restructuring (Details)
Restructuring (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | ||
Restructuring Costs [Abstract] | ||||||
Restructuring charges | [1] | $ 0.8 | $ 0 | $ 2.8 | $ 0 | |
Restructuring Reserves [Abstract] | ||||||
Restructuring reserves included in accrued liabilities | 5.8 | 5.8 | $ 10.1 | |||
Restructuring Programs 2018 [Member] | ||||||
Restructuring Program [Roll Forward] | ||||||
Balance at beginning of period | 10.1 | |||||
Charged to expense - Termination benefits | 2.4 | |||||
Charged to expense - Other | 0.4 | |||||
Payments | (7) | |||||
Other, net | (0.1) | |||||
Balance at end of period | 5.8 | 5.8 | ||||
Restructuring Reserves [Abstract] | ||||||
Restructuring reserves included in accrued liabilities | $ 5.8 | 5.8 | $ 10.1 | |||
Restructuring Programs 2018 [Member] | Other Operating Expense, Net [Member] | ||||||
Restructuring Costs [Abstract] | ||||||
Restructuring charges | 2.8 | |||||
Restructuring Programs 2018 [Member] | Industrials [Member] | Other Operating Expense, Net [Member] | ||||||
Restructuring Costs [Abstract] | ||||||
Restructuring charges | 1.9 | |||||
Restructuring Programs 2018 [Member] | Energy [Member] | Other Operating Expense, Net [Member] | ||||||
Restructuring Costs [Abstract] | ||||||
Restructuring charges | 1.1 | |||||
Restructuring Programs 2018 [Member] | Medical [Member] | Other Operating Expense, Net [Member] | ||||||
Restructuring Costs [Abstract] | ||||||
Restructuring charges | $ (0.2) | |||||
[1] | See Note 3 “Restructuring.” |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Inventory, Net [Abstract] | ||
Raw materials, including parts and subassemblies | $ 403.4 | $ 369.2 |
Work-in-process | 59.9 | 58.1 |
Finished goods | 81.1 | 83.4 |
Total inventories | 544.4 | 510.7 |
Excess of LIFO costs over FIFO costs | 13.2 | 13.2 |
Inventories | $ 557.6 | $ 523.9 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | ||
Goodwill [Roll Forward] | ||||||
Balance at beginning of period | $ 1,289.5 | |||||
Foreign currency translation and other | (4.6) | |||||
Balance at end of period | $ 1,284.9 | 1,284.9 | ||||
Goodwill impairment charges | 0 | $ 0 | ||||
Amortized intangible assets [Abstract] | ||||||
Accumulated amortization | (746.1) | (746.1) | $ (686.1) | |||
Unamortized intangible assets [Abstract] | ||||||
Total other intangible assets | 2,049.9 | 2,049.9 | 2,054.5 | |||
Amortization of Intangible Assets [Abstract] | ||||||
Intangible asset amortization expense | 30.9 | $ 31.5 | 62.3 | $ 62.4 | ||
Future Amortization of Intangible Assets [Abstract] | ||||||
2020 | 123.2 | 123.2 | ||||
2021 | 123.2 | 123.2 | ||||
2022 | 123.2 | 123.2 | ||||
2023 | 123.2 | 123.2 | ||||
2024 | 123.2 | 123.2 | ||||
Industrials [Member] | ||||||
Goodwill [Roll Forward] | ||||||
Balance at beginning of period | 632.7 | |||||
Foreign currency translation and other | [1] | (2.2) | ||||
Balance at end of period | 630.5 | 630.5 | ||||
Correction of purchase accounting allocation | 0.2 | |||||
Energy [Member] | ||||||
Goodwill [Roll Forward] | ||||||
Balance at beginning of period | 453.6 | |||||
Foreign currency translation and other | (2.3) | |||||
Balance at end of period | 451.3 | 451.3 | ||||
Accumulated goodwill impairment losses | 563.9 | 563.9 | ||||
Medical [Member] | ||||||
Goodwill [Roll Forward] | ||||||
Balance at beginning of period | 203.2 | |||||
Foreign currency translation and other | (0.1) | |||||
Balance at end of period | 203.1 | 203.1 | ||||
Trademarks [Member] | ||||||
Unamortized intangible assets [Abstract] | ||||||
Gross carrying amount | 610.4 | 610.4 | 611.3 | |||
Customer Lists and Relationships [Member] | ||||||
Amortized intangible assets [Abstract] | ||||||
Gross carrying amount | 1,241.9 | 1,241.9 | 1,245.5 | |||
Accumulated amortization | (620.9) | (620.9) | (567.8) | |||
Technology [Member] | ||||||
Amortized intangible assets [Abstract] | ||||||
Gross carrying amount | 21.5 | 21.5 | 21.7 | |||
Accumulated amortization | (5.3) | (5.3) | (4.8) | |||
Trademarks [Member] | ||||||
Amortized intangible assets [Abstract] | ||||||
Gross carrying amount | 44.7 | 44.7 | 44.9 | |||
Accumulated amortization | (14.6) | (14.6) | (13) | |||
Backlog [Member] | ||||||
Amortized intangible assets [Abstract] | ||||||
Gross carrying amount | 68.6 | 68.6 | 68.8 | |||
Accumulated amortization | (68.6) | (68.6) | (68.6) | |||
Other [Member] | ||||||
Amortized intangible assets [Abstract] | ||||||
Gross carrying amount | 62.8 | 62.8 | 62.3 | |||
Accumulated amortization | $ (36.7) | $ (36.7) | $ (31.9) | |||
[1] | During the six month period ended June 30, 2019, the Company recorded an increase in goodwill of $0.2 million as a result of measurement period adjustments in the Industrials segment. |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | ||
Accrued Liabilities [Abstract] | ||||||
Salaries, wages and related fringe benefits | $ 64.4 | $ 64.4 | $ 62.9 | |||
Restructuring | 5.8 | 5.8 | 10.1 | |||
Taxes | 21.5 | 21.5 | 24.3 | |||
Contract liabilities | 60.6 | 60.6 | 69.6 | |||
Product warranty | 23.4 | 23.4 | 23.9 | |||
Accrued interest | 0.7 | 0.7 | 0.3 | |||
Operating lease liabilities | [1] | 17.5 | 17.5 | 0 | ||
Other | 57.6 | 57.6 | 57.4 | |||
Total accrued liabilities | 251.5 | 251.5 | $ 248.5 | |||
Accrued Product Warranty Liability [Roll Forward] | ||||||
Balance at beginning of period | 21.8 | $ 24.3 | 23.9 | $ 22.3 | ||
Product warranty accruals | 7.8 | 5.5 | 14.6 | 11.6 | ||
Settlements | (6.3) | (5.2) | (15.1) | (10.6) | ||
Charged to other accounts | [2] | 0.1 | (0.7) | 0 | 0.6 | |
Balance at end of period | $ 23.4 | $ 23.9 | $ 23.4 | $ 23.9 | ||
[1] | The Company adopted ASU 2016-02, Leases, on January 1, 2019 using the optional transition method. See Note 1 “Condensed Consolidated Financial Statements” for further discussion of the adoption of ASU 2016-02 and Note 14 “Leases” for discussion of the Company’s operating and financing leases. | |||||
[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 Postretirem_3
Pension and Other Postretirement Benefits (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Pension Benefits [Member] | U.S. Plans [Member] | ||||
Net Periodic Benefit Cost [Abstract] | ||||
Service cost | $ 0 | $ 0 | $ 0 | $ 0 |
Interest cost | 0.6 | 0.5 | 1.1 | 1 |
Expected return on plan assets | (0.6) | (1.2) | (1.1) | (2.3) |
Recognition of [Abstract] | ||||
Unrecognized prior service cost | 0 | 0 | 0 | 0 |
Unrecognized net actuarial loss | 0 | 0 | 0.1 | 0 |
Total net periodic benefit (income) cost recognized | 0 | (0.7) | 0.1 | (1.3) |
Pension Benefits [Member] | Non-U.S. Plans [Member] | ||||
Net Periodic Benefit Cost [Abstract] | ||||
Service cost | 0.4 | 0.4 | 0.8 | 0.9 |
Interest cost | 1.9 | 1.9 | 3.9 | 3.8 |
Expected return on plan assets | (2.6) | (2.9) | (5.2) | (5.9) |
Recognition of [Abstract] | ||||
Unrecognized prior service cost | 0.1 | 0 | 0.1 | 0 |
Unrecognized net actuarial loss | 0.5 | 0.5 | 1 | 1 |
Total net periodic benefit (income) cost recognized | 0.3 | (0.1) | 0.6 | (0.2) |
Other Postretirement Benefits [Member] | ||||
Net Periodic Benefit Cost [Abstract] | ||||
Service cost | 0 | 0 | 0 | 0 |
Interest cost | 0.1 | 0 | 0.1 | 0.1 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Recognition of [Abstract] | ||||
Unrecognized prior service cost | 0 | 0 | 0 | 0 |
Unrecognized net actuarial loss | 0 | 0 | 0 | 0 |
Total net periodic benefit (income) cost recognized | $ 0.1 | $ 0 | $ 0.1 | $ 0.1 |
Debt, Summary of Debt (Details)
Debt, Summary of Debt (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Dec. 31, 2018 | |||
Debt [Abstract] | ||||
Short-term borrowings | $ 0 | $ 0 | ||
Long-term debt [Abstract] | ||||
Unamortized debt issuance costs | (9) | (3.3) | ||
Total long-term debt, net, including current maturities | 1,631.5 | 1,672.1 | ||
Current maturities of long-term debt | 8 | 7.9 | ||
Total long-term debt, net | 1,623.5 | $ 1,664.2 | ||
Revolving Credit Facility, Due 2020 [Member] | ||||
Long-term debt [Abstract] | ||||
Debt instrument maturity date | Apr. 30, 2020 | |||
Revolving Credit Facility, Due 2024 [Member] | ||||
Long-term debt [Abstract] | ||||
Long-term debt | [1] | $ 0 | $ 0 | |
Debt instrument maturity date | Jun. 28, 2024 | |||
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 | $ 927.6 | [2] | 952.6 | |
Debt instrument maturity date | Dec. 31, 2024 | |||
Interest rate | 5.15% | |||
Weighted-average interest rate | 5.24% | |||
Term Loan Denominated in Euros, Due 2024 [Member] | ||||
Long-term debt [Abstract] | ||||
Long-term debt | $ 686.9 | [3] | 696.5 | |
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 | $ 26.3 | ||
[1] | On June 28, 2019, the Revolving Credit Facility’s maturity was extended to June 28, 2024 as part of the Amendment described within this Note. As of December 31, 2018, the maturity was April 30, 2020. | |||
[2] | As of June 30, 2019, the applicable interest rate was 5.15% and the weighted-average rate was 5.24% for the six month period ended June 30, 2019. | |||
[3] | As of June 30, 2019, the applicable interest rate was 3.00% and the weighted-average rate was 3.00% for the six month period ended June 30, 2019. |
Debt (Details)
Debt (Details) € in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019EUR (€) | Jun. 30, 2019USD ($) | Jun. 28, 2019USD ($) | |
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Principal payment of outstanding borrowings | $ 28.8 | $ 110.5 | |||||
LIBOR [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Outstanding borrowing | € 604.2 | $ 927.6 | |||||
Receivables Financing Agreement [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Outstanding borrowing | 0 | ||||||
Letters of credit outstanding | 26.7 | ||||||
Remaining borrowing capacity | 76.4 | ||||||
Term Loan Denominated in U.S. Dollars, Due 2024 [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Principal payment of outstanding borrowings | $ 25 | ||||||
Senior Secured Credit Facility [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Aggregate principal amount | $ 450 | ||||||
Revolving Credit Facility [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Outstanding borrowing | 0 | ||||||
Letters of credit outstanding | 5 | ||||||
Unused availability | 445 | ||||||
Write-off of unamortized debt issuance costs | $ 0.2 | $ 0.2 | |||||
Revolving Credit Facility [Member] | Ingersoll Rand [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Letters of credit outstanding | 400 | ||||||
Aggregate principal amount | $ 1,000 | ||||||
Revolving Credit Facility [Member] | LIBOR [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Basis spread on variable rate | 2.25% | ||||||
Revolving Credit Facility [Member] | Base Rate [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Basis spread on variable rate | 1.25% | ||||||
Revolving Credit Facility [Member] | Letter of Credit [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Maximum borrowing capacity | $ 200 |
Stock-Based Compensation, Stock
Stock-Based Compensation, Stock-Based Award Plan Activity (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Share-based Compensation Arrangement [Abstract] | |||||
Stock-based compensation expense | $ 6 | $ 1.8 | $ 13.6 | $ 5.2 | |
Accrued liabilities | 251.5 | 251.5 | $ 248.5 | ||
Stock Options [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Unrecognized compensation expense | 35 | 35 | |||
Restricted Stock Awards [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Unrecognized compensation expense | 35 | 35 | |||
2013 Stock Incentive Plan [Member] | Stock Appreciation Rights (SARs) [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Accrued liabilities | $ 11.2 | 11.2 | |||
2013 and 2017 Plan [Member] | Former Employee [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Stock-based compensation expense | 0.7 | ||||
2013 and 2017 Plan [Member] | Equity Awards [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Stock-based compensation expense | 5 | ||||
2013 and 2017 Plan [Member] | Stock Appreciation Rights (SARs) [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Increase in liability | $ 7.9 |
Stock-Based Compensation, Sto_2
Stock-Based Compensation, Stock Option Awards (Details) - Stock Options and Stock Appreciation Rights [Member] shares in Thousands | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Shares [Roll Forward] | |
Outstanding, beginning balance (in shares) | shares | 12,352 |
Granted (in shares) | shares | 1,070 |
Exercised or settled (in shares) | shares | (3,890) |
Forfeited (in shares) | shares | (90) |
Expired (in shares) | shares | (9) |
Outstanding, ending balance (in shares) | shares | 9,433 |
Vested (in shares) | shares | 7,266 |
Outstanding Weighted-Average Exercise Price [Abstract] | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 10.93 |
Granted (in dollars per share) | $ / shares | 27.05 |
Exercised or settled (in dollars per share) | $ / shares | 8.72 |
Forfeited (in dollars per share) | $ / shares | 30.42 |
Expired (in dollars per share) | $ / shares | 32.06 |
Outstanding, ending balance (in dollars per share) | $ / shares | 13.46 |
Vested (in dollars per share) | $ / shares | $ 9.61 |
Stock-Based Compensation, Assum
Stock-Based Compensation, Assumptions Used to Estimate Fair Value of Options Granted (Details) - Stock Options [Member] | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Assumptions [Abstract] | ||
Expected life of options | 6 years 3 months 18 days | |
Expected dividend rate | 0.00% | 0.00% |
Minimum [Member] | ||
Assumptions [Abstract] | ||
Expected life of options | 7 years | |
Risk-free interest rate | 2.40% | 2.90% |
Assumed volatility | 30.70% | 34.40% |
Maximum [Member] | ||
Assumptions [Abstract] | ||
Expected life of options | 7 years 6 months | |
Risk-free interest rate | 2.60% | 3.00% |
Assumed volatility | 31.80% | 35.40% |
Stock-Based Compensation, Restr
Stock-Based Compensation, Restricted Stock Unit Awards (Details) - Restricted Stock Unit [Member] shares in Thousands | 6 Months Ended |
Jun. 30, 2019$ / sharesshares | |
Shares [Roll Forward] | |
Non-vested, beginning balance (in shares) | shares | 362 |
Granted (in shares) | shares | 418 |
Vested (in shares) | shares | (33) |
Forfeited (in shares) | shares | (38) |
Non-vested, ending balance (in shares) | shares | 709 |
Weighted-Average Grant-Date Fair Value [Abstract] | |
Non-vested, beginning balance (in dollars per share) | $ / shares | $ 31.78 |
Granted (in dollars per share) | $ / shares | 27.05 |
Vested (in dollars per share) | $ / shares | 31.97 |
Forfeited (in dollars per share) | $ / shares | 31.56 |
Non-vested, ending balance (in dollars per share) | $ / shares | $ 28.97 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive (Loss) Income, Accumulated Other Comprehensive (Loss) Income Balances (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |||
Before-Tax Amount [Abstract] | ||||||
Foreign currency translation adjustments, net | $ (8.6) | $ (58.1) | $ (4.1) | $ (28.5) | ||
Unrecognized (losses) gains on cash flow hedges, net | (0.7) | 6.2 | 0.6 | 21.3 | ||
Pension and other postretirement benefit prior service cost and gain or loss, net | 1.3 | 3.3 | 1.5 | 2.1 | ||
Other comprehensive loss | (8) | (48.6) | (2) | (5.1) | ||
Tax (Expense) or Benefit [Abstract] | ||||||
Foreign currency translation adjustments, net | 2.2 | (9.4) | (2.4) | (4.6) | ||
Unrecognized (losses) gains on cash flow hedges, net | 0.2 | (1.5) | 0.8 | (5.2) | ||
Pension and other postretirement benefit prior service cost and gain or loss, net | (0.1) | (0.6) | (0.1) | 1 | ||
Other comprehensive loss | 2.3 | (11.5) | (1.7) | (8.8) | ||
Net of Tax Amount [Abstract] | ||||||
Foreign currency translation adjustments, net | (6.4) | (67.5) | (6.5) | (33.1) | ||
Unrecognized (losses) gains on cash flow hedges, net | (0.5) | 4.7 | 1.4 | 16.1 | ||
Pension and other postretirement benefit prior service cost and gain or loss, net | 1.2 | 2.7 | 1.4 | 3.1 | ||
Total other comprehensive loss, net of tax | $ (5.7) | $ (60.1) | $ (3.7) | [1] | $ (13.9) | [1] |
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive (Loss) Income, Changes in Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | ||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Other comprehensive (loss) income before reclassifications | [1] | $ (10.4) | $ (20.7) | ||||||||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 6.7 | 6.8 | ||||||||
Total other comprehensive loss, net of tax | $ (5.7) | $ (60.1) | (3.7) | [1] | (13.9) | [1] | |||||
Accumulated Other Comprehensive Income (Loss) [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Beginning balance | [1] | (247) | (199.8) | ||||||||
Ending balance | [1] | (258.9) | (213.4) | (258.9) | (213.4) | ||||||
Accumulated Other Comprehensive Income (Loss) [Member] | ASU 2018-02 [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | $ (8.2) | [1] | $ 0 | ||||||||
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 | 0 | 0.3 | [1] | ||||||||
Foreign Currency Translation Adjustments, Net [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Beginning balance | [1] | (190.6) | (129.6) | ||||||||
Other comprehensive (loss) income before reclassifications | [1] | (6.5) | (33.1) | ||||||||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 0 | 0 | ||||||||
Total other comprehensive loss, net of tax | [1] | (6.5) | (33.1) | ||||||||
Ending balance | [1] | (198.6) | (162.7) | (198.6) | (162.7) | ||||||
Foreign Currency Translation Adjustments, Net [Member] | ASU 2018-02 [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | (1.5) | |||||||||
Foreign Currency Translation Adjustments, Net [Member] | ASU 2017-12 [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | 0 | |||||||||
Unrealized (Losses) Gains on Cash Flow Hedges [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Beginning balance | [1] | (11.4) | (29.8) | ||||||||
Other comprehensive (loss) income before reclassifications | [1] | (4.4) | 10.1 | ||||||||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 5.8 | 6 | ||||||||
Total other comprehensive loss, net of tax | [1] | 1.4 | 16.1 | ||||||||
Ending balance | [1] | (16.7) | (13.4) | (16.7) | (13.4) | ||||||
Unrealized (Losses) Gains on Cash Flow Hedges [Member] | ASU 2018-02 [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | (6.7) | |||||||||
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 | [1] | 0.3 | |||||||||
Pension and Postretirement Benefit Plans [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Beginning balance | [1] | (45) | (40.4) | ||||||||
Other comprehensive (loss) income before reclassifications | [1] | 0.5 | 2.3 | ||||||||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 0.9 | 0.8 | ||||||||
Total other comprehensive loss, net of tax | [1] | 1.4 | 3.1 | ||||||||
Ending balance | [1] | $ (43.6) | $ (37.3) | $ (43.6) | $ (37.3) | ||||||
Pension and Postretirement Benefit Plans [Member] | ASU 2018-02 [Member] | |||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | $ 0 | |||||||||
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 | [1] | $ 0 | |||||||||
[1] | All amounts are net of tax. Amounts in parentheses indicate debits. |
Accumulated Other Comprehensi_5
Accumulated Other Comprehensive (Loss) Income, Reclassifications out of Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | ||
Income Statement [Abstract] | |||||
Interest expense | $ 22.4 | $ 26.1 | $ 44.8 | $ 52.1 | |
Total before tax | 53.2 | 77.5 | 112.4 | 143.4 | |
Income tax benefit | (8.3) | (17.2) | (20.3) | (40.7) | |
Net of tax | $ 44.9 | $ 60.3 | 92.1 | 102.7 | |
Reclassification out of Accumulated Other Comprehensive (Loss) Income [Member] | |||||
Income Statement [Abstract] | |||||
Net of tax | 6.7 | 6.8 | |||
Loss on Cash Flow Hedges - Interest Rate Swaps [Member] | Reclassification out of Accumulated Other Comprehensive (Loss) Income [Member] | |||||
Income Statement [Abstract] | |||||
Interest expense | 7.6 | 7.9 | |||
Total before tax | 7.6 | 7.9 | |||
Income tax benefit | (1.8) | (1.9) | |||
Net of tax | 5.8 | 6 | |||
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] | 1.2 | 1 | ||
Total before tax | 1.2 | 1 | |||
Income tax benefit | (0.3) | (0.2) | |||
Net of tax | $ 0.9 | $ 0.8 | |||
[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 V_3
Hedging Activities and Fair Value Measurements, Hedging Activities and Derivative Instruments within the Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Jun. 30, 2019 | Dec. 31, 2018 | ||
Maximum [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
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] | $ 825 | $ 925 |
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] | 7.4 | 11.2 |
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] | 13.2 | 8.7 |
Foreign Currency Forwards [Member] | Maximum [Member] | |||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||
Notional amount | 47.3 | ||
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] | 123.5 | 143.3 |
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] | 0.8 | 1.3 |
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 | 0 |
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] | 71.8 | 27.5 |
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 | 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] | 1.5 | 0.1 |
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 |
[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 V_4
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 | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | ||
Gains and Losses on Derivatives Designated as Cash Flow Hedges [Abstract] | |||||
(Loss) gain recognized in AOCI on derivatives | $ (4.6) | $ 3.1 | $ (7) | $ 13.4 | |
Loss reclassified from AOCI into income (effective portion) | [1] | $ (3.9) | $ (3.1) | $ (7.6) | $ (7.9) |
[1] | Losses on derivatives reclassified from accumulated other comprehensive income (“AOCI”) into income were included within “Interest expense” in the Condensed Consolidated Statements of Operations. |
Hedging Activities and Fair V_5
Hedging Activities and Fair Value Measurements, Interest Rate Swap Contracts (Details) € in Millions, $ in Millions | 6 Months Ended | ||
Jun. 30, 2019USD ($) | Jun. 30, 2019EUR (€)Contract | Jun. 30, 2019USD ($)Contract | |
Derivative, Fair Value, Net [Abstract] | |||
Number of contracts | Contract | 8 | 8 | |
LIBOR [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Expected losses to be reclassified out of AOCI into earnings during next 12 months | $ | $ 18.3 | ||
Long-term debt outstanding | € 604.2 | $ 927.6 | |
Interest Rate Swap Contracts [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Number of contracts | Contract | 8 | 8 | |
Interest Rate Swap Contracts [Member] | LIBOR [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Long-term debt hedged | $ | $ 825 | ||
Interest Rate Swap Contracts [Member] | LIBOR [Member] | Minimum [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Fixed interest rate | 3.30% | 3.30% | |
Interest Rate Swap Contracts [Member] | LIBOR [Member] | Maximum [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Fixed interest rate | 4.30% | 4.30% |
Hedging Activities and Fair V_6
Hedging Activities and Fair Value Measurements, Foreign Currency Forward Contracts (Details) $ in Millions | Jun. 30, 2019USD ($)Contract |
Derivative, Fair Value, Net [Abstract] | |
Number of contracts | Contract | 8 |
Foreign Currency Forwards [Member] | Minimum [Member] | |
Derivative, Fair Value, Net [Abstract] | |
Notional amount | $ 7.6 |
Foreign Currency Forwards [Member] | Maximum [Member] | |
Derivative, Fair Value, Net [Abstract] | |
Notional amount | $ 47.3 |
Hedging Activities and Fair V_7
Hedging Activities and Fair Value Measurements, Derivative Instruments not Designated as Accounting Hedges (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Derivative instruments not designated as accounting hedges [Abstract] | ||||
Total foreign currency transaction (losses) gains, net | $ (0.6) | $ 2.4 | $ (3.7) | $ (0.2) |
Foreign Currency Forward Contracts (Losses) Gains [Member] | ||||
Derivative instruments not designated as accounting hedges [Abstract] | ||||
Total foreign currency transaction (losses) gains, net | $ (2.2) | $ 7.3 | $ (3.8) | $ 6.2 |
Hedging Activities and Fair V_8
Hedging Activities and Fair Value Measurements, Investment in Consolidated Subsidiaries with Functional Currencies Other than USD (Details) € in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019EUR (€) | Jun. 30, 2019USD ($) | Aug. 17, 2017EUR (€) | |
Euro Term Loan [Member] | |||||||
Derivative, Fair Value, Net [Abstract] | |||||||
Long-term debt hedged | € | € 604.2 | € 615 | |||||
Interest Rate Swap Contracts [Member] | |||||||
Changes in the value of debt and designated interest rate swaps [Abstract] | |||||||
(Loss) gain, net of income tax, recorded through other comprehensive income | $ (7) | $ 29.7 | $ 4.7 | $ 14.5 | |||
Balance included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018, respectively | $ 46.7 | $ 46.7 | $ 61.3 |
Hedging Activities and Fair V_9
Hedging Activities and Fair Value Measurements, Fair Value Measurements (Details) - Recurring [Member] $ in Millions | Jun. 30, 2019USD ($) | |
Financial Assets [Abstract] | ||
Foreign currency forwards | $ 0.8 | [1] |
Trading securities held in deferred compensation plan | 6.5 | [2] |
Total | 7.3 | |
Financial Liabilities [Abstract] | ||
Foreign currency forwards | 1.5 | [1] |
Interest rate swaps | 20.6 | [3] |
Deferred compensation plan | 6.5 | [2] |
Total | 28.6 | |
Level 1 [Member] | ||
Financial Assets [Abstract] | ||
Foreign currency forwards | 0 | [1] |
Trading securities held in deferred compensation plan | 6.5 | [2] |
Total | 6.5 | |
Financial Liabilities [Abstract] | ||
Foreign currency forwards | 0 | [1] |
Interest rate swaps | 0 | [3] |
Deferred compensation plan | 6.5 | [2] |
Total | 6.5 | |
Level 2 [Member] | ||
Financial Assets [Abstract] | ||
Foreign currency forwards | 0.8 | [1] |
Trading securities held in deferred compensation plan | 0 | [2] |
Total | 0.8 | |
Financial Liabilities [Abstract] | ||
Foreign currency forwards | 1.5 | [1] |
Interest rate swaps | 20.6 | [3] |
Deferred compensation plan | 0 | [2] |
Total | 22.1 | |
Level 3 [Member] | ||
Financial Assets [Abstract] | ||
Trading securities held in deferred compensation plan | 0 | [2] |
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 as 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 June 30, 2019. 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 C_3
Revenue from Contracts with Customers, Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | ||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | $ 629.1 | $ 668.2 | $ 1,249.4 | $ 1,287.7 | |
Revenue Recognized at Point in Time [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [1] | 597.7 | 639.4 | 1,190.5 | 1,246.3 |
Revenue Recognized over Time [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [2] | 31.4 | 28.8 | 58.9 | 41.4 |
Original Equipment [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [3] | 394 | 408.4 | 769.3 | 773.4 |
Aftermarket [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [4] | 235.1 | 259.8 | 480.1 | 514.3 |
Total Americas [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 320.1 | 334.5 | 633.3 | 661.2 | |
United States [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 274 | 288.9 | 543.2 | 566 | |
Other Americas [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 46.1 | 45.6 | 90.1 | 95.2 | |
EMEA [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 209.3 | 237.6 | 433.6 | 450.7 | |
Asia Pacific [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 99.7 | 96.1 | 182.5 | 175.8 | |
Industrials [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 334.3 | 328.7 | 652.4 | 645.6 | |
Industrials [Member] | Revenue Recognized at Point in Time [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [1] | 322.9 | 314.1 | 630.4 | 621.6 |
Industrials [Member] | Revenue Recognized over Time [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [2] | 11.4 | 14.6 | 22 | 24 |
Industrials [Member] | Original Equipment [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [3] | 231 | 225.6 | 450.7 | 441.2 |
Industrials [Member] | Aftermarket [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [4] | 103.3 | 103.1 | 201.7 | 204.4 |
Industrials [Member] | Total Americas [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 129.2 | 108 | 249 | 219.6 | |
Industrials [Member] | United States [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 103.4 | 91 | 202.1 | 181.4 | |
Industrials [Member] | Other Americas [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 25.8 | 17 | 46.9 | 38.2 | |
Industrials [Member] | EMEA [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 155.8 | 164.6 | 308 | 325.6 | |
Industrials [Member] | Asia Pacific [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 49.3 | 56.1 | 95.4 | 100.4 | |
Energy [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 222.8 | 273.1 | 455.9 | 515.3 | |
Energy [Member] | Revenue Recognized at Point in Time [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [1] | 202.8 | 258.9 | 419 | 497.9 |
Energy [Member] | Revenue Recognized over Time [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [2] | 20 | 14.2 | 36.9 | 17.4 |
Energy [Member] | Original Equipment [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [3] | 92.7 | 118.6 | 181.5 | 210 |
Energy [Member] | Aftermarket [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [4] | 130.1 | 154.5 | 274.4 | 305.3 |
Energy [Member] | Total Americas [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 160.1 | 201.2 | 325.2 | 394.1 | |
Energy [Member] | United States [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 140.1 | 173.1 | 282.9 | 338.5 | |
Energy [Member] | Other Americas [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 20 | 28.1 | 42.3 | 55.6 | |
Energy [Member] | EMEA [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 25.9 | 45.2 | 69.8 | 70.4 | |
Energy [Member] | Asia Pacific [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 36.8 | 26.7 | 60.9 | 50.8 | |
Medical [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 72 | 66.4 | 141.1 | 126.8 | |
Medical [Member] | Revenue Recognized at Point in Time [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [1] | 72 | 66.4 | 141.1 | 126.8 |
Medical [Member] | Revenue Recognized over Time [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [2] | 0 | 0 | 0 | 0 |
Medical [Member] | Original Equipment [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [3] | 70.3 | 64.2 | 137.1 | 122.2 |
Medical [Member] | Aftermarket [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | [4] | 1.7 | 2.2 | 4 | 4.6 |
Medical [Member] | Total Americas [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 30.8 | 25.3 | 59.1 | 47.5 | |
Medical [Member] | United States [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 30.5 | 24.8 | 58.2 | 46.1 | |
Medical [Member] | Other Americas [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 0.3 | 0.5 | 0.9 | 1.4 | |
Medical [Member] | EMEA [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | 27.6 | 27.8 | 55.8 | 54.7 | |
Medical [Member] | Asia Pacific [Member] | |||||
Disaggregation of Revenue [Abstract] | |||||
Disaggregated revenue | $ 13.6 | $ 13.3 | $ 26.2 | $ 24.6 | |
[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 the 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. |
Revenue from Contracts with C_4
Revenue from Contracts with Customers, Performance Obligations (Details) $ in Millions | Jun. 30, 2019USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-06-30 | |
Revenue, Performance Obligation [Abstract] | |
Remaining performance obligation amount | $ 218.9 |
Remaining performance obligation, expected timing of satisfaction, period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-06-30 | |
Revenue, Performance Obligation [Abstract] | |
Remaining performance obligation amount | $ 50.5 |
Remaining performance obligation, expected timing of satisfaction, period |
Revenue from Contracts with C_5
Revenue from Contracts with Customers, Contract Balances (Details) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Contract with Customer, Asset and Liability [Abstract] | ||
Accounts receivable | $ 498.6 | $ 525.4 |
Contract assets | 26 | 19.6 |
Contract liabilities | $ 60.6 | $ 69.6 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Income Taxes [Abstract] | ||||
Income before income taxes | $ 53.2 | $ 77.5 | $ 112.4 | $ 143.4 |
Provision for income taxes | $ 8.3 | $ 17.2 | $ 20.3 | $ 40.7 |
Effective income tax provision rate | 15.60% | 22.20% | 18.10% | 28.40% |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | ||
Components of lease expense [Abstract] | ||||
Operating lease cost | $ 5.6 | $ 11 | ||
Finance lease cost [Abstract] | ||||
Amortization of right-of-use assets | 0.3 | 0.7 | ||
Interest on lease liabilities | 0.4 | 0.8 | ||
Total finance lease cost | 0.7 | 1.5 | ||
Short-term lease cost | 0.3 | 0.5 | ||
Cash paid for amounts included in the measurement of leases [Abstract] | ||||
Operating cash flows from operating leases | 10.9 | |||
Operating cash flows from finance leases | 0.8 | |||
Financing cash flows from finance leases | 0.4 | |||
Operating leases [Abstract] | ||||
Other assets | 57.3 | 57.3 | ||
Operating Lease Liability [Abstract] | ||||
Accrued liabilities | [1] | 17.5 | 17.5 | $ 0 |
Other liabilities | 40.1 | 40.1 | ||
Total operating lease liabilities | 57.6 | 57.6 | ||
Finance Leases [Abstract] | ||||
Property, plant and equipment | 24.6 | 24.6 | ||
Finance Lease Liability [Abstract] | ||||
Short-term borrowings and current maturities of long-term debt | 1 | 1 | ||
Long-term debt, less current maturities | 24.9 | 24.9 | ||
Total finance lease liabilities | $ 25.9 | $ 25.9 | ||
Weighted Average Remaining Lease Term (in years) [Abstract] | ||||
Operating leases | 4 years 7 months 6 days | 4 years 7 months 6 days | ||
Finance leases | 14 years 1 month 6 days | 14 years 1 month 6 days | ||
Weighted Average Discount Rate [Abstract] | ||||
Operating leases | 2.40% | 2.40% | ||
Finance leases | 6.30% | 6.30% | ||
Operating Lease Liabilities [Abstract] | ||||
2019 (excluding the six months ended June 30, 2019) | $ 9.8 | $ 9.8 | ||
2020 | 16.6 | 16.6 | ||
2,021 | 11.7 | 11.7 | ||
2,022 | 8 | 8 | ||
2,023 | 5.3 | 5.3 | ||
Thereafter | 9.2 | 9.2 | ||
Total lease payments | 60.6 | 60.6 | ||
Less imputed interest | (3) | (3) | ||
Total operating lease liabilities | 57.6 | 57.6 | ||
Finance Lease Liabilities [Abstract] | ||||
2019 (excluding the six months ended June 30, 2019) | 1.3 | 1.3 | ||
2020 | 2.5 | 2.5 | ||
2021 | 2.6 | 2.6 | ||
2022 | 2.6 | 2.6 | ||
2023 | 2.7 | 2.7 | ||
Thereafter | 28.8 | 28.8 | ||
Total lease payments | 40.5 | 40.5 | ||
Less imputed interest | (14.6) | (14.6) | ||
Total finance lease liabilities | 25.9 | 25.9 | ||
Future minimum rental payments for operating leases [Abstract] | ||||
Future minimum rental payments for operating leases, 2019 | 25.8 | 25.8 | ||
Future minimum rental payments for operating leases, 2020 | 19.5 | 19.5 | ||
Future minimum rental payments for operating leases, 2021 | 13.9 | 13.9 | ||
Future minimum rental payments for operating leases, 2022 | 7.7 | 7.7 | ||
Future minimum rental payments for operating leases, 2023 | 5.4 | 5.4 | ||
Future minimum rental payments for operating leases, Thereafter | 9.4 | 9.4 | ||
Future minimum rental payments for capital leases [Abstract] | ||||
Future minimum rental payments for capital leases, 2019 | 0.8 | 0.8 | ||
Future minimum rental payments for capital leases, 2020 | 1 | 1 | ||
Future minimum rental payments for capital leases, 2021 | 1.1 | 1.1 | ||
Future minimum rental payments for capital leases, 2022 | 1.2 | 1.2 | ||
Future minimum rental payments for capital leases, 2023 | 1.4 | 1.4 | ||
Future minimum rental payments for capital leases, Thereafter | $ 20.7 | $ 20.7 | ||
[1] | The Company adopted ASU 2016-02, Leases, on January 1, 2019 using the optional transition method. See Note 1 “Condensed Consolidated Financial Statements” for further discussion of the adoption of ASU 2016-02 and Note 14 “Leases” for discussion of the Company’s operating and financing leases. |
Supplemental Information (Detai
Supplemental Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | ||
Other Operating Expense, Net [Abstract] | |||||
Foreign currency transaction losses (gains), net | $ 0.6 | $ (2.4) | $ 3.7 | $ 0.2 | |
Restructuring charges, net | [1] | 0.8 | 0 | 2.8 | 0 |
Stock-based compensation | [2] | 7.1 | (0.8) | 16.4 | 1.9 |
Shareholder litigation settlement recoveries | [3] | 0 | 0 | (6) | (4.5) |
Acquisition related expenses and non-cash charges | [4] | 17.1 | 2.9 | 18.7 | 5.9 |
Gains on asset disposals | (0.4) | 0 | (0.3) | (1.2) | |
Other, net | 0.1 | 0.9 | 1.1 | 2.6 | |
Total other operating expense, net | 25.3 | 0.6 | 36.4 | 4.9 | |
Share-based Compensation [Abstract] | |||||
Stock-based compensation expense recognized | 6 | 1.8 | 13.6 | 5.2 | |
Increase in stock-based compensation expense due to costs associated with employer taxes | $ 1.1 | $ 2.8 | |||
Decrease in stock-based compensation expense due to reduction of an accrual related to employer taxes | $ 2.6 | $ 3.3 | |||
[1] | See Note 3 “Restructuring.” | ||||
[2] | Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2019 of $6.0 million and $13.6 million, respectively, increased by $1.1 million and $2.8 million for the three month and six month periods ended June 30, 2019, respectively, due to costs associated with employer taxes. | ||||
[3] | Represents an insurance recovery of the Company’s shareholder litigation settlement in 2014. | ||||
[4] | Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs), and non-cash charges and credits arising from fair value purchase accounting adjustments. |
Contingencies (Details)
Contingencies (Details) $ in Millions | 6 Months Ended | |
Jun. 30, 2019USD ($)DefendantSite | Dec. 31, 2018USD ($) | |
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 | $ | $ 6.8 | $ 6.9 |
Asbestos and Silica Related Litigation [Member] | ||
Asbestos and Silica Related Litigation [Abstract] | ||
Litigation reserve | $ | 102.3 | 105.8 |
Insurance recovery receivable amount | $ | $ 102.8 | $ 103 |
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 | 6 Months Ended | ||||
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2019USD ($)Segment | Jun. 30, 2018USD ($) | |||
Segment Results [Abstract] | ||||||
Number of reportable segments | Segment | 3 | |||||
Segment Reporting [Abstract] | ||||||
Revenue | $ 629.1 | $ 668.2 | $ 1,249.4 | $ 1,287.7 | ||
Less items to reconcile Segment Adjusted EBITDA to Income Before Income Taxes [Abstract] | ||||||
Interest expense | 22.4 | 26.1 | 44.8 | 52.1 | ||
Restructuring and related business transformation costs | 2 | 8.4 | 6.1 | 12.9 | ||
Acquisition related expenses and non-cash charges | [1] | 17.1 | 2.9 | 18.7 | 5.9 | |
Stock-based compensation | 13.6 | 5.2 | ||||
Foreign currency transaction losses (gains), net | (0.6) | 2.4 | (3.7) | (0.2) | ||
Loss on extinguishment of debt | 0.2 | 0.2 | 0.2 | 0.2 | ||
Shareholder litigation settlement recoveries | [2] | 0 | 0 | (6) | (4.5) | |
Income Before Income Taxes | 53.2 | 77.5 | 112.4 | 143.4 | ||
Insurance recoveries of legal defense costs | 5.6 | |||||
Restructuring and Related Business Transformation Costs [Abstract] | ||||||
Restructuring charges | [3] | 0.8 | 0 | 2.8 | 0 | |
Severance, sign-on, relocation and executive search costs | 0.2 | 1.9 | 1.2 | 3.9 | ||
Facility reorganization, relocation and other costs | 0.5 | 0.7 | 1.1 | 1.3 | ||
Information technology infrastructure transformation | 0.4 | 0.2 | 0.7 | 0.2 | ||
Gains on asset disposals | (0.4) | 0 | (0.3) | (1.2) | ||
Consultant and other advisor fees | 0.1 | 4 | 0.2 | 6.6 | ||
Other, net | 0.4 | 1.6 | 0.4 | 2.1 | ||
Total restructuring and related business transformation costs | 2 | 8.4 | 6.1 | 12.9 | ||
Stock-based compensation expense recognized | 6 | 1.8 | 13.6 | 5.2 | ||
Increase in stock-based compensation expense due to costs associated with employer taxes | 1.1 | 2.8 | ||||
Decrease in stock-based compensation expense due to reduction of an accrual related to employer taxes | 2.6 | 3.3 | ||||
Industrials [Member] | ||||||
Segment Reporting [Abstract] | ||||||
Revenue | 334.3 | 328.7 | 652.4 | 645.6 | ||
Energy [Member] | ||||||
Segment Reporting [Abstract] | ||||||
Revenue | 222.8 | 273.1 | 455.9 | 515.3 | ||
Medical [Member] | ||||||
Segment Reporting [Abstract] | ||||||
Revenue | 72 | 66.4 | 141.1 | 126.8 | ||
Operating Segments [Member] | ||||||
Segment Reporting [Abstract] | ||||||
Adjusted EBITDA | 154.3 | 168.8 | 305.4 | 319.4 | ||
Operating Segments [Member] | Industrials [Member] | ||||||
Segment Reporting [Abstract] | ||||||
Revenue | 334.3 | 328.7 | 652.4 | 645.6 | ||
Adjusted EBITDA | 76.6 | 71.1 | 147.7 | 137.9 | ||
Operating Segments [Member] | Energy [Member] | ||||||
Segment Reporting [Abstract] | ||||||
Revenue | 222.8 | 273.1 | 455.9 | 515.3 | ||
Adjusted EBITDA | 56.3 | 79.7 | 116.3 | 147.6 | ||
Operating Segments [Member] | Medical [Member] | ||||||
Segment Reporting [Abstract] | ||||||
Revenue | 72 | 66.4 | 141.1 | 126.8 | ||
Adjusted EBITDA | 21.4 | 18 | 41.4 | 33.9 | ||
Corporate [Member] | ||||||
Less items to reconcile Segment Adjusted EBITDA to Income Before Income Taxes [Abstract] | ||||||
Corporate expenses not allocated to segments | 6.7 | 7.2 | 17.7 | 9.6 | [4] | |
Segment Reconciling Items [Member] | ||||||
Less items to reconcile Segment Adjusted EBITDA to Income Before Income Taxes [Abstract] | ||||||
Interest expense | 22.4 | 26.1 | 44.8 | 52.1 | ||
Depreciation and amortization expenses | 44.4 | 45.3 | 89.9 | 90.2 | ||
Restructuring and related business transformation costs | [5] | 2 | 8.4 | 6.1 | 12.9 | |
Acquisition related expenses and non-cash charges | [6] | 17.1 | 5.7 | 18.7 | 10.3 | |
Expenses related to public stock offerings | [7] | 0 | 0.5 | 0 | 1.9 | |
Establish public company financial reporting compliance | [8] | 0 | 1.1 | 0.6 | 1.9 | |
Stock-based compensation | [9] | 7.1 | (0.8) | 16.4 | 1.9 | |
Foreign currency transaction losses (gains), net | 0.6 | (2.4) | 3.7 | 0.2 | ||
Loss on extinguishment of debt | [10] | 0.2 | 0.2 | 0.2 | 0.2 | |
Shareholder litigation settlement recoveries | [11] | 0 | 0 | (6) | (4.5) | |
Other adjustments | [12] | 0.6 | 0 | 0.9 | (0.7) | |
Restructuring and Related Business Transformation Costs [Abstract] | ||||||
Total restructuring and related business transformation costs | [5] | $ 2 | $ 8.4 | $ 6.1 | $ 12.9 | |
[1] | Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs), and non-cash charges and credits arising from fair value purchase accounting adjustments. | |||||
[2] | Represents an insurance recovery of the Company’s shareholder litigation settlement in 2014. | |||||
[3] | See Note 3 “Restructuring.” | |||||
[4] | Includes insurance recoveries of asbestos legal fees of $5.6 million in the six month period ended June 30, 2018. | |||||
[5] | Restructuring and related business transformation costs consist of the following. | |||||
[6] | Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs) and non-cash charges and credits arising from fair value purchase accounting adjustments. | |||||
[7] | Represents certain expenses related to the Company’s secondary stock offerings. | |||||
[8] | Represents third party expenses to comply with the requirements of Sarbanes-Oxley and the accelerated adoption of the new accounting standards (ASC 606 - Revenue from Contracts with Customers and ASC 842 - Leases) in the first quarter of 2018 and 2019, respectively, one year ahead of the required adoption dates for a private company. | |||||
[9] | Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2019 of $6.0 million and $13.6 million, respectively increased by $1.1 million and $2.8 million for the three month and six month periods ended June 30, 2019, respectively, due to costs associated with employer taxes. | |||||
[10] | Represents losses on extinguishment of a portion of the U.S. term loan and the amendment of the revolving credit facility. | |||||
[11] | Represents an insurance recovery of the Company’ shareholder litigation settlement in 2014. | |||||
[12] | Includes (i) effects of amortization of prior service costs and amortization of losses in pension and other postemployment (“OPEB”) expense, (ii) certain legal and compliance costs and (iii) other miscellaneous adjustments. |
Related Party Transactions (Det
Related Party Transactions (Details) - 6 months ended Jun. 30, 2019 - KKR [Member] € in Millions, $ in Millions | EUR (€) | USD ($) |
Related Party Transaction, Due to Related Party [Abstract] | ||
Related party transaction, structuring fees | $ | $ 0.4 | |
Lender in Senior Secured Credit Facilities [Member] | Euro Term Loan Facility [Member] | ||
Related Party Transaction, Due to Related Party [Abstract] | ||
Related party transaction amount | € | € 48.2 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 44.9 | $ 60.3 | $ 92.1 | $ 102.7 |
Average shares outstanding [Abstract] | ||||
Basic (in shares) | 203.4 | 201.8 | 202.5 | 201.7 |
Diluted (in shares) | 208.9 | 209.6 | 208.4 | 209.8 |
Earnings per share [Abstract] | ||||
Basic (in dollars per share) | $ 0.22 | $ 0.30 | $ 0.45 | $ 0.51 |
Diluted (in dollars per share) | $ 0.21 | $ 0.29 | $ 0.44 | $ 0.49 |
Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of diluted loss per share (in shares) | 1.8 | 0.8 | 1.8 | 0.8 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Jul. 08, 2019USD ($) |
Subsequent Event [Member] | Oina VV AB [Member] | |
Business Combinations [Abstract] | |
Cash consideration | $ 10 |