Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2016shares | |
Document and Entity Information | |
Entity Registrant Name | ECOLAB INC. |
Entity Central Index Key | 31,462 |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2016 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 293,305,223 |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED STATEMENT OF INCOM
CONSOLIDATED STATEMENT OF INCOME - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CONSOLIDATED STATEMENT OF INCOME | ||
Net sales | $ 3,097.4 | $ 3,297.6 |
Cost of sales (including special charges of $0.6 in 2015) | 1,631.4 | 1,765.3 |
Selling, general and administrative expenses | 1,088.2 | 1,136.8 |
Special (gains) and charges | 6.3 | 7.8 |
Operating income | 371.5 | 387.7 |
Interest expense, net | 66.1 | 62.5 |
Income before income taxes | 305.4 | 325.2 |
Provision for income taxes | 73.4 | 89.8 |
Net income including noncontrolling interest | 232 | 235.4 |
Net income attributable to noncontrolling interest | 1.2 | 2 |
Net income attributable to Ecolab | $ 230.8 | $ 233.4 |
Earnings attributable to Ecolab per common share | ||
Basic (in dollars per share) | $ 0.78 | $ 0.78 |
Diluted (in dollars per share) | 0.77 | 0.77 |
Dividends declared per common share (in dollars per share) | $ 0.350 | $ 0.330 |
Weighted-average common shares outstanding | ||
Basic (in shares) | 294.4 | 298.2 |
Diluted (in shares) | 298.3 | 303.2 |
CONSOLIDATED STATEMENT OF INCO3
CONSOLIDATED STATEMENT OF INCOME (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Special charges | $ 6.3 | $ 7.8 |
Cost of sales | ||
Special charges | $ 0.6 |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | ||
Net income including noncontrolling interest | $ 232 | $ 235.4 |
Foreign currency translation adjustments | ||
Foreign currency translation | (96.3) | (309.4) |
Gain (loss) on net investment hedges | (15) | 57 |
Total foreign currency translation adjustments | (111.3) | (252.4) |
Derivatives and hedging instruments | (10.5) | 7.8 |
Pension and postretirement benefits | ||
Amortization of net actuarial loss and prior service cost included in net periodic pension and postretirement costs | 5.6 | 8 |
Total pension and postretirement benefits | 5.6 | 8 |
Subtotal | (116.2) | (236.6) |
Total comprehensive income, including noncontrolling interest | 115.8 | (1.2) |
Comprehensive income (loss) attributable to noncontrolling interest | 4.6 | 1 |
Comprehensive income (loss) attributable to Ecolab | $ 111.2 | $ (2.2) |
CONSOLIDATED BALANCE SHEET
CONSOLIDATED BALANCE SHEET - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 268.5 | $ 92.8 |
Accounts receivable, net | 2,248.8 | 2,390.2 |
Inventories | 1,386.1 | 1,388.2 |
Deferred income taxes | 250 | |
Other current assets | 291.5 | 326.3 |
Total current assets | 4,194.9 | 4,447.5 |
Property, plant and equipment, net | 3,227 | 3,228.3 |
Goodwill | 6,474.9 | 6,490.8 |
Other intangible assets, net | 4,031.1 | 4,109.2 |
Other assets | 413.9 | 365.9 |
Total assets | 18,341.8 | 18,641.7 |
Current liabilities | ||
Short-term debt | 1,756.6 | 2,205.3 |
Accounts payable | 986.1 | 1,049.6 |
Compensation and benefits | 435.5 | 509 |
Income taxes | 58.5 | 52.2 |
Other current liabilities | 922.8 | 948.3 |
Total current liabilities | 4,159.5 | 4,764.4 |
Long-term debt | 5,082.8 | 4,260.2 |
Postretirement health care and pension benefits | 1,112.4 | 1,117.1 |
Deferred income taxes | 1,106.4 | 1,281.2 |
Other liabilities | 228.6 | 238.4 |
Total liabilities | 11,689.7 | 11,661.3 |
Equity | ||
Common stock | 351 | 350.3 |
Additional paid-in capital | 5,088 | 5,086.1 |
Retained earnings | 6,288.3 | 6,160.3 |
Accumulated other comprehensive loss | (1,536.1) | (1,423.3) |
Treasury stock | (3,609.8) | (3,263.5) |
Total Ecolab shareholders' equity | 6,581.4 | 6,909.9 |
Noncontrolling interest | 70.7 | 70.5 |
Total equity | 6,652.1 | 6,980.4 |
Total liabilities and equity | $ 18,341.8 | $ 18,641.7 |
CONSOLIDATED BALANCE SHEET (Par
CONSOLIDATED BALANCE SHEET (Parenthetical) - $ / shares shares in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
CONSOLIDATED BALANCE SHEET | ||
Common stock, shares authorized | 800 | 800 |
Common stock, par value per share (in dollars per share) | $ 1 | $ 1 |
Common stock, shares outstanding | 293.3 | 296 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
OPERATING ACTIVITIES | ||
Net income including noncontrolling interest | $ 232 | $ 235.4 |
Adjustments to reconcile net income including noncontrolling interest to cash provided by operating activities: | ||
Depreciation | 139.6 | 142.1 |
Amortization | 72.6 | 75.1 |
Deferred income taxes | 41.1 | 3.2 |
Share-based compensation expense | 29.1 | 25.3 |
Excess tax benefits from share-based payment arrangements | (6.7) | (19.7) |
Pension and postretirement plan contributions | (24) | (21) |
Pension and postretirement plan expense | 14.2 | 29.3 |
Restructuring charges, net of cash paid | (13.7) | (9.5) |
Other, net | 7.5 | 4.8 |
Changes in operating assets and liabilities, net of effect of acquisitions: | ||
Accounts receivable | 113.3 | (12.4) |
Inventories | (1.2) | (83.6) |
Other assets | (5.4) | (45.3) |
Accounts payable | (58.2) | (170) |
Other liabilities | (67.7) | (41.2) |
Cash provided by operating activities | 472.5 | 112.5 |
INVESTING ACTIVITIES | ||
Capital expenditures | (140.1) | (166.8) |
Capitalized software expenditures | (8.6) | (6.8) |
Property and other assets sold | 7.3 | 6 |
Acquisitions and investments in affiliates, net of cash acquired | (9.5) | (10.8) |
Release from acquisition related escrow | 9.4 | |
Cash used for investing activities | (150.9) | (169) |
FINANCING ACTIVITIES | ||
Net issuances (repayments) of commercial paper and notes payable | (329.6) | 335.7 |
Long-term debt borrowings | 794.1 | 595.5 |
Long-term debt repayments | (125.7) | (375.7) |
Reacquired shares | (389.9) | (412.6) |
Dividends paid | (108) | (99.8) |
Exercise of employee stock options | 9.3 | 23 |
Excess tax benefits from share-based payment arrangements | 6.7 | 19.7 |
Acquisition related liabilities and contingent consideration | (2.3) | 0.1 |
Cash provided by (used for) financing activities | (145.4) | 85.9 |
Effect of exchange rate changes on cash and cash equivalents | (0.5) | (1.1) |
Increase in cash and cash equivalents | 175.7 | 28.3 |
Cash and cash equivalents, beginning of year | 92.8 | 209.6 |
Cash and cash equivalents, end of year | $ 268.5 | $ 237.9 |
CONSOLIDATED FINANCIAL INFORMAT
CONSOLIDATED FINANCIAL INFORMATION | 3 Months Ended |
Mar. 31, 2016 | |
CONSOLIDATED FINANCIAL INFORMATION | |
CONSOLIDATED FINANCIAL INFORMATION | CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 1. CONSOLIDATED FINANCIAL INFORMATION The unaudited consolidated financial information for the first quarter ended March 31, 2016 and 2015 reflect, in the opinion of company management, all adjustments necessary for a fair presentation of the financial position, results of operations, comprehensive income (loss) and cash flows of Ecolab Inc. ("Ecolab" or "the company") for the interim periods presented. Any adjustments consist of normal, recurring items. The financial results for any interim period are not necessarily indicative of results for the full year. The consolidated balance sheet data as of December 31, 2015 was derived from the audited consolidated financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited consolidated financial information should be read in conjunction with the consolidated financial statements and notes thereto incorporated in the company's Annual Report on Form 10-K for the year ended December 31, 2015. During the first quarter of 2016, the company early-adopted the accounting guidance issued in November 2015 that requires all deferred tax assets and liabilities to be classified as noncurrent on the Consolidated Balance Sheet, using the prospective application method. Prior periods have not been retrospectively adjusted for adoption of this guidance. Previous guidance required the deferred taxes for each jurisdiction to be presented as a net current asset or liability and net noncurrent asset or liability. As a result of the new guidance, each jurisdiction will now only have one net noncurrent deferred tax asset or liability. The new guidance does not change the existing requirement that only permits offsetting deferred tax assets and liabilities within a single jurisdiction. With respect to the unaudited financial information of the company for the first quarter ended March 31, 2016 and 2015 included in this Form 10-Q, PricewaterhouseCoopers LLP reported that they have applied limited procedures in accordance with professional standards for a review of such information. Their separate report dated May 5, 2016 appearing herein states that they did not audit and they do not express an opinion on that unaudited financial information. Accordingly, the degree of reliance on their report on such information should be restricted in light of the limited nature of the review procedures applied. PricewaterhouseCoopers LLP is not subject to the liability provisions of Section 11 of the Securities Act of 1933, as amended (the "Act"), for their report on the unaudited financial information because that report is not a "report" or a "part" of a registration statement prepared or certified by PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11 of the Act . |
SPECIAL (GAINS) AND CHARGES
SPECIAL (GAINS) AND CHARGES | 3 Months Ended |
Mar. 31, 2016 | |
SPECIAL (GAINS) AND CHARGES | |
SPECIAL (GAINS) AND CHARGES | 2. SPECIAL (GAINS) AND CHARGES Special (gains) and charges reported on the Consolidated Statement of Income include the following: First Quarter Ended March 31 (millions) 2016 2015 Cost of sales Restructuring charges $ - $ Special (gains) and charges Restructuring charges Champion integration costs - Nalco integration costs - Other - Subtotal Total special (gains) and charges $ $ For segment reporting purposes, special (gains) and charges are included in the Corporate segment, which is consistent with the company’s internal management reporting. Restructuring Charges The company’s restructuring activities are associated with plans to enhance its efficiency and effectiveness and sharpen its competitiveness. Its restructuring plans include net costs associated with significant actions involving employee-related severance charges, contract termination costs and asset write-downs and disposals. Employee termination costs are largely based on policies and severance plans, and include personnel reductions and related costs for severance, benefits and outplacement services. These charges are reflected in the quarter when the actions are probable and the amounts are estimable, which typically is when management approves the actions. Contract termination costs include charges to terminate leases prior to the end of their respective terms and other contract terminations. Asset write-downs and disposals include leasehold improvement write-downs, other asset write-downs associated with combining operations and disposal of assets. Restructuring charges have been included as a component of cost of sales and special (gains) and charges on the Consolidated Statement of Income. Amounts included as a component of cost of sales include supply chain related severance and other asset write-downs associated with combining operations. Restructuring liabilities have been classified as a component of both other current and other noncurrent liabilities on the Consolidated Balance Sheet. Energy Restructuring Plan In April 2013, following the completion of the acquisition of privately held Champion Technologies and its related company Corsicana Technologies (collectively “Champion”), the company commenced plans to undertake restructuring and other cost-saving actions to realize its acquisition-related cost synergies as well as streamline and strengthen Ecolab’s position in the global energy market (the “Energy Restructuring Plan”). Actions associated with the acquisition to improve the effectiveness and efficiency of the business included a reduction of the combined business’s global workforce. Actions also included leveraging and simplifying its global supply chain, including the reduction of plant, distribution center and redundant facility locations and product line optimization. Restructuring charges within the Energy Restructuring Plan were substantially completed during the fourth quarter of 2015. The company recorded $2.9 million ($1.7 million after tax) and $1.0 million ($0.8 million after tax) during the first quarter of 2016 and 2015, respectively. Restructuring charges and activity related to the Energy Restructuring Plan since inception of the underlying actions include the following: Employee Termination Asset (millions) Costs Disposals Other Total 2013 - 2015 Activity Recorded expense and accrual $ $ $ $ Net cash payments Non-cash charges - - Effect of foreign currency translation - - Restructuring liability, December 31, 2015 - 2016 Activity Recorded expense and accrual - Net cash payments - Restructuring liability, March 31, 2016 $ $ - $ $ The majority of cash payments under this plan are related to severance, with the current accrual expected to be paid over a period of a few months to several quarters. The company anticipates the remaining cash expenditures will continue to be funded from operating activities. Combined Restructuring Plan In February 2011, the company commenced a comprehensive plan to substantially improve the efficiency and effectiveness of its European business, as well as undertake certain restructuring activities outside of Europe, historically referred to as the “2011 Restructuring Plan”. Additionally, in January 2012, following the merger with Nalco Holding Company (“Nalco”), the company formally commenced plans to undertake restructuring actions related to the reduction of its global workforce and optimization of its supply chain and office facilities, including planned reductions of plant and distribution center locations, historically referred to as the “Merger Restructuring Plan”. During the first quarter of 2013, the company determined that the objectives of the plans discussed above were aligned, and consequently, the previously separate restructuring plans were combined into one plan. The combined restructuring plan (the “Combined Plan”) combines opportunities and initiatives from both plans and continues to follow the original format of the Merger Restructuring Plan by focusing on global actions related to optimization of the supply chain and office facilities, including reductions of the global workforce, plant and distribution center locations. Restructuring charges within the Combined Plan were substantially completed during the fourth quarter of 2015. Restructuring charge activity under this plan during the first quarter of 2016 was minimal. During the first quarter of 2015 the company’s restructuring charges within this plan were $1.7 million ($0.8 million after tax). Restructuring charges and activity related to the Combined Plan since inception of the underlying actions include the following: Employee Termination Asset (millions) Costs Disposals Other Total 2011 - 2015 Activity Recorded net expense and accrual $ $ $ $ Net cash payments Non-cash net charges Effect of foreign currency translation - - Restructuring liability, December 31, 2015 - 2016 Activity Recorded accrual adjustment - Net cash payments - Effect of foreign currency translation - - Restructuring liability, March 31, 2016 $ $ - $ $ The majority of cash payments under this plan are related to severance, with the current accrual expected to be paid over a period of a few months to several quarters. The company anticipates the remaining cash expenditures will continue to be funded from operating activities. Non-restructuring special (gains) and charges Champion and Nalco integration costs Integration related special charges for the Champion acquisition and Nalco merger were completed during the fourth quarter of 2015, and the company did not incur any special charges related to such transactions during the first quarter of 2016. As a result of the Champion acquisition, the company incurred charges of $5.2 million ($3.2 million after tax) during the first quarter of 2015. As a result of the Nalco merger, the company incurred charges of $0.5 million ($0.5 million after tax) during the first quarter of 2015. |
ACQUISITIONS AND DISPOSITIONS
ACQUISITIONS AND DISPOSITIONS | 3 Months Ended |
Mar. 31, 2016 | |
ACQUISITIONS AND DISPOSITIONS | |
ACQUISITIONS AND DISPOSITIONS | 3. ACQUISITIONS AND DISPOSITIONS Acquisitions Acquisitions during the first three months of 2016 and all of 2015 were not material to the company’s consolidated financial statements. The aggregate purchase price of acquisitions has been reduced for any cash or cash equivalents acquired with the acquisitions. Based upon purchase price allocations, the components of the aggregate purchase prices of completed acquisitions and immaterial purchase price adjustments during the first three months of 2016 and 2015 are shown in the following table. First Quarter Ended March 31 2016 2015 (millions) Net tangible assets acquired $ $ Identifiable intangible assets Customer relationships Patents - Trademarks - Other technology - Total intangible assets Goodwill Total aggregate purchase price Acquisition related liabilities and contingent consideration Net cash paid for acquisitions, including acquisition related liabilities and contingent consideration $ $ Amounts within the 2016 column of the previous table, including acquisition related liabilities, primarily relate to the purchase of certain assets of Keedak Limited, an oilfield chemical distributor in Nigeria. Amounts within the 2015 column of the previous table primarily relate to the acquisitions of Aseptix Health Sciences NV and Commercial Pest Control Pty Ltd. The weighted average useful lives of identifiable intangible assets acquired during the first three months of 2016 and 2015, as shown in the previous table, were 5 and 11 years, respectively. Dispositions There were no business disposals during the first quarter of 2016 or 2015. |
BALANCE SHEET INFORMATION
BALANCE SHEET INFORMATION | 3 Months Ended |
Mar. 31, 2016 | |
BALANCE SHEET INFORMATION | |
BALANCE SHEET INFORMATION | 4. BALANCE SHEET INFORMATION March 31 December 31 (millions) 2016 2015 Accounts receivable, net Accounts receivable $ $ Allowance for doubtful accounts Total $ $ Inventories Finished goods $ $ Raw materials and parts Inventories at FIFO cost FIFO cost to LIFO cost difference Total $ $ Other current assets Prepaid assets $ $ Taxes receivable Derivative assets Other current assets Total $ $ Property, plant and equipment, net Land $ $ Buildings and improvements Leasehold improvements Machinery and equipment Merchandising and customer equipment Capitalized software Construction in progress Accumulated depreciation Total $ $ Other intangible assets, net Intangible assets not subject to amortization Trade names $ $ Intangible assets subject to amortization Customer relationships $ $ Trademarks Patents Other technology Accumulated amortization Customer relationships Trademarks Patents Other technology Net intangible assets subject to amortization Total $ $ Other assets Deferred income taxes $ $ Pension Other Total $ $ March 31 December 31 (millions) 2016 2015 Other current liabilities Discounts and rebates $ $ Dividends payable Interest payable Taxes payable, other than income Derivative liabilities Restructuring Other Total $ $ Accumulated other comprehensive loss Unrealized gain (loss) on derivative financial instruments, net of tax $ $ Unrecognized pension and postretirement benefit expense, net of tax Cumulative translation, net of tax Total $ $ |
DEBT AND INTEREST
DEBT AND INTEREST | 3 Months Ended |
Mar. 31, 2016 | |
DEBT AND INTEREST | |
DEBT AND INTEREST | 5. DEBT AND INTEREST The following table provides the components of the company’s short-term debt obligations as of March 31, 2016 and December 31, 2015. March 31 December 31 2016 2015 (millions) Short-term debt Commercial paper $ $ Notes payable Long-term debt, current maturities Total $ $ As of March 31, 2016, the company had in place a $2.0 billion multi-year credit facility which expires in December 2019. The credit facility has been established with a diverse syndicate of banks and supports the company’s $2.0 billion U.S. commercial paper program and the company’s $200 million European commercial paper program. The company’s U.S. commercial paper program, as shown in the previous table, had $285 million and $605 million outstanding as of March 31, 2016 and December 31, 2015, respectively. The company had no commercial paper outstanding under its European program as of either March 31, 2016 or December 31, 2015. The following table provides the components of the company’s long-term debt obligations, including current maturities, as of March 31 , 2016 and December 31, 2015. Maturity March 31 December 31 (millions) by Year 2016 2015 Long-term debt Description / 2016 Principal Amount Term loan ($0) 2016 $ - $ Series B private placement senior notes (€175 million) 2016 Five year 2011 senior notes ($1.25 billion) 2016 Five year 2012 senior notes ($500 million) 2017 Three year 2015 senior notes ($300 million) 2018 Series A private placement senior notes ($250 million) 2018 Three year 2016 senior notes ($400 million) 2019 - Five year 2015 senior notes ($300 million) 2020 Ten year 2011 senior notes ($1.25 billion) 2021 Series B private placement senior notes ($250 million) 2023 Seven year 2016 senior notes ($400 million) 2023 - Ten year 2015 senior notes (€575 million) 2025 Thirty year 2011 senior notes ($750 million) 2041 Capital lease obligations Other Total debt Long-term debt, current maturities Total long-term debt $ $ Term Loans In January 2016, the company repaid the remaining $125 million of its term loan borrowings. Public Notes In January 2016, the company issued $800 million of debt securities consisting of a $400 million aggregate principal three year fixed rate note with a coupon rate of 2.00% and a $400 million aggregate principal seven year fixed rate note with a coupon rate of 3.25% (“Public Notes”). The proceeds were used to repay a portion of the company’s outstanding commercial paper, repay the remaining term loan balance, and for general corporate purposes. The Public Notes may be redeemed by the company at its option at redemption prices that include accrued and unpaid interest and a make-whole premium. Upon the occurrence of a change of control accompanied by a downgrade of the Public Notes below investment grade rating, within a specified time period, the company will be required to offer to repurchase the Public Notes at a price equal to 101% of the aggregate principal amount thereof, plus any accrued and unpaid interest to the date of repurchase. The Public Notes are senior unsecured and unsubordinated obligations of the company and rank equally with all other senior and unsubordinated indebtedness of the company. Other Debt During the first quarter of 2015, the company acquired the beneficial interest in the trust owning the leased Naperville facility resulting in debt assumption of $100.2 million and the addition of $135.2 million in property, plant and equipment. Certain administrative, divisional, and research and development personnel are based at the Naperville facility. Cash paid as a result of the transaction was $19.8 million. The assumed debt is reflected within the "Other" line of the table above. The assumption of debt and the majority of the property, plant and equipment addition represent non-cash financing and investing activities, respectively. Covenants The company is in compliance with its debt covenants as of March 31, 2016. Net Interest Expense Interest expense and interest income recognized during the first quarter of 2016 and 2015 were as follows: First Quarter Ended March 31 (millions) 2016 2015 Interest expense $ $ Interest income Interest expense, net $ $ |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2016 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Goodwill and Other Intangible Assets | 6. GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in a business combination. The company’s reporting units are its operating segments. The company tests goodwill for impairment on an annual basis during the second quarter. If circumstances change significantly, the company would also test a reporting unit’s goodwill for impairment during interim periods between its annual tests. As a result of the continued challenges in the global energy market, during the first quarter of 2016, the company updated its goodwill impairment assessment for the Global Energy segment, which indicated no impairment. There has been no impairment of goodwill since the adoption of Financial Accounting Standards Board (“FASB”) guidance for goodwill and other intangibles on January 1, 2002. The changes in the carrying amount of goodwill for each of the company's reportable segments during the three months ended March 31, 2016 were as follows: Global Global Global (millions) Industrial Institutional Energy Other Total December 31, 2015 $ $ $ $ $ Current year business combinations (a) - - - Prior year business combinations (b) - - Reclassifications (c) - - Effect of foreign currency translation March 31, 2016 $ $ $ $ $ (a) For 2016, none of the goodwill related to businesses acquired is expected to be tax deductible. (b) Represents purchase price allocation adjustments for 2015 acquisitions deemed preliminary as of December 31, 2015. (c) Represents immaterial reclassifications of beginning balances to conform to the current year presentation. Other Intangible Assets The Nalco trade name is the company’s principle indefinite life intangible asset, which is tested for impairment on an annual basis during the second quarter. Based on the ongoing performance of the company’s operating units, updating the impairment testing during the first quarter of 2016 was not deemed necessary. There has been no impairment of the Nalco trade name intangible asset since it was acquired. The company’s intangible assets subject to amortization primarily include customer relationships, trademarks, patents and other technology. The fair value of identifiable intangible assets is estimated based upon discounted future cash flow projections and other acceptable valuation methods. Other intangible assets are amortized on a straight-line basis over their estimated economic lives. Total amortization expense related to other intangible assets during the first quarter ended March 31, 2016 and 2015 was $72.6 million and $73.1 million, respectively. Estimated expense for the remaining nine month period of 2016 related to other amortizable intangible assets is expected to be $220 million. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2016 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 7. FAIR VALUE MEASUREMENTS The company’s financial instruments include cash and cash equivalents, investments held in rabbi trusts, accounts receivable, accounts payable, contingent consideration obligations, commercial paper, notes payable, foreign currency forward contracts, interest rate swap contracts and long-term debt. Fair value is defined as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. A hierarchy has been established for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs be used when available. The hierarchy is broken down into three levels: Level 1 - Inputs are quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities. Level 2 - Inputs include observable inputs other than quoted prices in active markets. Level 3 - Inputs are unobservable inputs for which there is little or no market data available. The carrying amount and the estimated fair value for assets and liabilities measured on a recurring basis were: 2016 March 31 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Investments held in rabbi trusts $ $ $ - $ - Foreign currency forward contracts - - Interest rate swap contracts - - Contingent consideration - - Liabilities Foreign currency forward contracts - - Interest rate swap contracts - - Contingent consideration - - 2015 December 31 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Investments held in rabbi trusts $ $ $ - $ - Foreign currency forward contracts - - Contingent consideration - - Liabilities Foreign currency forward contracts - - Interest rate swap contracts - - Contingent consideration - - The carrying value of investments held in rabbi trusts is at fair value, which is determined using quoted prices in active markets, and is classified within level 1. The carrying value of foreign currency forward contracts is at fair value, which is determined based on foreign currency exchange rates as of the balance sheet date, and is classified within level 2. The carrying value of interest rate swap contracts is at fair value, which is determined based on current interest rates and forward interest rates as of the balance sheet date and is classified within level 2. For purposes of fair value disclosure above, derivative values are presented gross. See further discussion of gross versus net presentation of the company's derivatives within Note 8. Contingent consideration obligations are recognized and measured at fair value at the acquisition date. Contingent consideration is classified within level 3 as the underlying fair value is measured based on the probability-weighted present value of the consideration expected to be transferred. The consideration expected to be transferred is based on the company’s expectations of various financial measures. The ultimate payment of contingent consideration could deviate from current estimates based on the actual results of these financial measures. Changes in the net fair value of contingent consideration for the three months ended March 31, 2016 were as follows: (millions) Contingent consideration, December 31, 2015 $ Amount recognized at transaction date - Losses (gains) recognized in earnings - Settlements - Foreign currency translation Contingent consideration, March 31, 2016 $ The carrying values of accounts receivable, accounts payable, cash and cash equivalents, commercial paper and notes payable approximate fair value because of their short maturities, and as such are classified within level 1. The fair value of long-term debt is based on quoted market prices for the same or similar debt instruments. The carrying amount and the estimated fair value of long-term debt, including current maturities, held by the company were: March 31 December 31 2016 2015 Carrying Fair Carrying Fair (millions) Amount Value Amount Value Long-term debt, including current maturities $ $ $ $ |
DERIVATIVES AND HEDGING TRANSAC
DERIVATIVES AND HEDGING TRANSACTIONS | 3 Months Ended |
Mar. 31, 2016 | |
DERIVATIVES AND HEDGING TRANSACTIONS | |
DERIVATIVES AND HEDGING TRANSACTIONS | 8. DERIVATIVES AND HEDGING TRANSACTIONS The company uses foreign currency forward contracts, interest rate swaps and foreign currency debt to manage risks associated with foreign currency exchange rates, interest rates and net investments in foreign operations. The company does not hold derivative financial instruments of a speculative nature or for trading purposes. The company records derivatives as assets and liabilities on the balance sheet at fair value. Changes in fair value are recognized immediately in earnings unless the derivative qualifies and is designated as a hedge. Cash flows from derivatives are classified in the statement of cash flows in the same category as the cash flows from the items subject to designated hedge or undesignated (economic) hedge relationships. The company evaluates hedge effectiveness at inception and on an ongoing basis. If a derivative is no longer expected to be effective, hedge accounting is discontinued. Hedge ineffectiveness, if any, is recorded in earnings. The company is exposed to credit risk in the event of nonperformance of counterparties for foreign currency forward exchange contracts and interest rate swap agreements. The company monitors its exposure to credit risk by using credit approvals and credit limits and by selecting major international banks and financial institutions as counterparties. The company does not anticipate nonperformance by any of these counterparties, and therefore, recording a valuation allowance against the company’s derivative balance is not considered necessary. Derivative Positions Summary Certain of the company’s derivative transactions are subject to master netting arrangements that allow the company to net settle contracts with the same counterparties. These arrangements generally do not call for collateral and as of the applicable dates presented below no cash collateral had been received or pledged related to the underlying derivatives. The respective net amounts are included in other current assets, other non-current assets and other current liabilities on the Consolidated Balance Sheet. The following table summarizes the gross fair value and the net value of the company’s outstanding derivatives. Asset Derivatives Liability Derivatives (millions) March 31 December 31 March 31 December 31 2016 2015 2016 2015 Derivatives designated as hedging instruments: Foreign currency forward contracts $ $ $ $ Interest rate swap contracts - Derivatives not designated as hedging instruments: Foreign currency forward contracts Gross value of derivatives Gross amounts offset in the Consolidated Balance Sheet Net value of derivatives $ $ $ $ The following table summarizes the notional values of the company’s outstanding derivatives. Notional Values March 31 December 31 (millions) 2016 2015 Foreign currency forward contracts $ $ Interest rate swap agreements $ $ Net investment hedge contracts (a) € 25 € 25 (a) The net investment hedge contracts exclude the company’s euro denominated debt. Cash Flow Hedges The company utilizes foreign currency forward contracts to hedge the effect of foreign currency exchange rate fluctuations on forecasted foreign currency transactions, including inventory purchases and intercompany royalty, management fee and other payments. These forward contracts are designated as cash flow hedges. The effective portions of the changes in fair value of these contracts are recorded in accumulated other comprehensive income (“AOCI”) until the hedged items affect earnings, at which time the gain or loss is reclassified into the same line item in the Consolidated Statement of Income as the underlying exposure being hedged. All cash flow hedged transactions are forecasted to occur within the next t hree years. The company occasionally enters into forward starting interest rate swap agreements to manage interest rate exposure. During 2015, the company entered into a series of forward starting interest rate swap agreements to hedge against changes in interest rates that could impact future debt issuances. The agreements were designated and effective as cash flow hedges of the expected interest payments related to the anticipated future debt issuances. Certain agreements were closed in January 2016, in conjunction with the debt issuance discussed in Note 6. During 2014, the company entered into a series of forward starting interest rate swap agreements in connection with both its U.S. public debt issuance completed in January 2015 and its euro public debt issuance completed in July 2015. During 2011, the company entered into and subsequently closed a series of forward starting interest rate swap agreements in connection with the issuance of its private placement debt. During 2006, the company entered into and subsequently closed two forward starting interest rate swap agreements related to the issuance of its senior euro notes. The 2015, 2014, 2011 and 2006 forward starting interest rate swap agreements were designated and effective as cash flow hedges of the expected interest payments related to the debt issuances. The amounts recorded in AOCI for the respective transactions are recognized as part of interest expense over the remaining life of the notes as the forecasted interest transactions occur. The impact on AOCI and earnings from derivative contracts that qualified as cash flow hedges was as follows: First Quarter Ended March 31 2016 2015 (millions) Unrealized gain (loss) recognized into AOCI (effective portion) Foreign currency forward contracts AOCI (equity) $ $ Interest rate swap contracts AOCI (equity) Total Gain (loss) recognized in income (effective portion) Foreign currency forward contracts Cost of sales SG&A Interest expense, net - Total Interest rate swap contracts Interest expense, net Total $ $ Gains and losses recognized in income related to the ineffective portion of the company’s cash flow hedges were insignificant during the first three months of 2016 and 2015. Fair Value Hedges The company manages interest expense using a mix of fixed and floating rate debt. To help manage exposure to interest rate movements and to reduce borrowing costs, the company may enter into interest rate swaps under which the company agrees to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed upon notional principal amount. The mark-to-market of these fair value hedges is recorded as gains or losses in interest expense and is offset by the gain or loss of the underlying debt instrument, which is also recorded in interest expense. These fair value hedges are highly effective and thus, there is no impact on earnings due to hedge ineffectiveness. In January 2016, the company entered into an interest rate swap agreement that converted its $400 million 2.00% debt from a fixed rate to a floating rate. The interest rate swap was designated as a fair value hedge. In January 2015, the company entered into interest rate swap agreements that converted its $300 million 1.55% debt, its $250 million 3.69% debt and a portion of its $1.25 billion 3.00% debt from fixed rates to floating interest rates. The interest rate swaps were designated as fair value hedges. In May 2014, the company entered into an interest rate swap agreement that converted its $500 million 1.45% debt from a fixed rate to a floating interest rate. The impact on earnings from derivative contracts that qualified as fair value hedges was as follows: First Quarter Ended March 31 2016 2015 (millions) Gain on derivative recognized income Interest rate swap Interest expense, net $ $ Loss on hedged item recognized income Interest rate swap Interest expense, net $ $ Net Investment Hedges The company designates its outstanding €175 million and €575 million (total of $816 million as of March 31, 2016) senior notes (“euronotes”) and related accrued interest as a hedge of existing foreign currency exposures related to net investments the company has in certain euro denominated functional currency subsidiaries. In addition to the euro-denominated debt designated as net investment hedges, the company also occasionally enters into forward contracts to hedge an additional portion of its net investment in euro denominated functional currency subsidiaries. During 2015, the company entered into forward contracts totaling €490 million, of which €105 million was closed during 2015. Also during 2015, the company de-designated €360 million of the forward contracts opened in 2015, and initiated undesignated hedges for €360 million to offset the impact of the original €360 million forward contracts. The revaluation gains and losses on the euronotes and of the forward contracts, which are designated and effective as hedges of the company’s net investments, have been included as a component of the cumulative translation adjustment account. Total revaluation gains and losses related to the euronotes and forward contract recorded as part of shareholders’ equity were as follows: First Quarter Ended March 31 (millions) 2016 2015 Revaluation gains (losses), net of tax $ $ Derivatives Not Designated as Hedging Instruments The company also uses foreign currency forward contracts to offset its exposure to the change in value of certain foreign currency denominated assets and liabilities held at foreign subsidiaries, primarily receivables and payables, which are remeasured at the end of each period. Although the contracts are effective economic hedges, they are not designated as accounting hedges. Therefore, changes in the value of these derivatives are recognized immediately in earnings, thereby offsetting the current earnings effect of the related foreign currency denominated assets and liabilities. The impact on earnings from derivative contracts that are not designated as hedging instruments was as follows: First Quarter Ended March 31 (millions) 2016 2015 Gain (loss) recognized in income Foreign currency forward contracts SG&A $ $ Interest expense, net Total $ $ The amounts recognized in SG&A above offset the earnings impact of the related foreign currency denominated assets and liabilities. The amounts recognized in interest expense above represent the component of the hedging gains (losses) attributable to the difference between the spot and forward rates of the hedges as a result of interest rate differentials. |
OTHER COMPREHENSIVE INCOME (LOS
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | 3 Months Ended |
Mar. 31, 2016 | |
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | |
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | 9. OTHER COMPREHENSIVE INCOME INFORMATION Other comprehensive income (loss) includes net income, foreign currency translation adjustments, unrecognized gains and losses on securities, defined benefit pension and postretirement plan adjustments, gains and losses on derivative instruments designated and effective as cash flow hedges and non-derivative instruments designated and effective as foreign currency net investment hedges that are charged or credited to the accumulated other comprehensive loss account in shareholders’ equity. The following tables provide other comprehensive income information related to the company’s derivatives and hedging instruments and pension and postretirement benefits. See Note 8 for additional information related to the company’s derivatives and hedging transactions. See Note 13 for additional information related to the company’s recognition of net actuarial losses and amortization of prior service benefits. First Quarter Ended March 31 (millions) 2016 2015 Derivative and Hedging Instruments Unrealized gains (losses) on derivative & hedging instruments Amount recognized in AOCI $ $ (Gains) losses reclassified from AOCI into income Cost of sales SG&A Interest expense, net Translation and other insignificant activity Tax impact Net of tax $ $ Pension and Postretirement Benefits Amount reclassified from AOCI into income Actuarial losses Prior service costs Tax impact Net of tax $ $ The following table summarizes the derivative and pension and postretirement benefit amounts reclassified from AOCI into income. First Quarter Ended March 31 2016 2015 (millions) Derivative (gains) losses reclassified from AOCI into income, net of tax $ $ Pension and postretirement benefits net actuarial losses and prior services costs reclassified from AOCI into income, net of tax $ $ |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2016 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | 10. SHAREHOLDERS’ EQUITY Share Repurchases In August 2011, the Finance Committee of the company’s Board of Directors, via delegation by the company’s Board of Directors, authorized the repurchase of 10 million common shares, including shares to be repurchased under Rule 10b5-1, which was contingent upon completion of the merger with Nalco. This authorization was completed during the first quarter of 2016. In February 2015, the company’s Board of Directors authorized the repurchase of up to 20 million additional shares of its common stock, including shares to be repurchased under Rule 10b5–1. As of March 31, 2016, 19,752,942 shares remained to be repurchased under the company’s repurchase authorization. The company intends to repurchase all shares under its authorization, for which no expiration date has been established, in open market or privately negotiated transactions, subject to market conditions. In February 2015, under the existing repurchase authorization discussed above, the company announced a $1.0 billion share repurchase program, of which $8 million remains to be repurchased as of March 31, 2016. This program will be completed during the second quarter of 2016. In February 2015, the company entered into an accelerated stock repurchase (“ASR”) agreement with a financial institution to repurchase $300 million of its common stock and received 2,066,293 shares of its common stock, which was approximately 80% of the total number of shares the company expected to be repurchased under the ASR, based on the price of the company’s common stock at that time. In connection with the finalization of the ASR agreement in April 2015, the company received an additional 555,511 shares of common stock. The final per share purchase price and the total number of shares to be repurchased under the February 2015 ASR agreement generally was based on the volume-weighted average price of the company’s common stock during the term of the agreement. Upon final settlement of the February 2015 ASR agreement, under certain circumstances, the financial institution was obligated to deliver additional shares to the company or the company was obligated to deliver additional shares of common stock or make a cash payment, at the company’s election, to the financial institution. In February 2016, the company entered into an additional ASR agreement to repurchase $300 million of its common stock and received 2,459,490 shares of its common stock, which was approximately 85% of the total number of shares the company expected to be repurchased under the ASR, based on the price of the company’s common stock at that time. The final per share purchase price and the total number of shares to be repurchased under the February 2016 ASR agreement generally will be based on the volume-weighted average price of the company’s common stock during the term of the agreement. Upon final settlement of the February 2016 ASR agreement, under certain circumstances, the financial institution will be obligated to deliver additional shares to the company or the company will be obligated to deliver additional shares of common stock or make a cash payment, at the company’s election, to the financial institution. All shares acquired under the ASR agreements were recorded as treasury stock. The ASRs were not dilutive to the company’s earnings per share calculations as of either March 31, 2016 or 2015. Additionally, neither of the ASR agreements triggered the two-class earnings per share methodology. The unsettled portion of ASRs met the criteria to be accounted for as a forward contract indexed to the company’s stock and qualified as an equity transaction as of both March 31, 2015 and 2016. The initial delivery of shares, as well as the additional receipt of shares at settlement resulted in a reduction to the company’s common stock outstanding used to calculate earnings per share, the impact of which was not material. During the first three months of 2016, the company reacquired 3,297,674 shares of its common stock, of which 3,145,617 related to share repurchases through open market or private purchases, including the February 2016 ASR discussed above, and 152,057 related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units. During all of 2015, the company reacquired 6,267,699 shares of its common stock through open market and private purchases, including the February 2015 ASR discussed above, and 398,704 of shares withheld for taxes related to the exercise of stock options and the vesting of stock awards and units. |
EARNINGS ATTRIBUTABLE TO ECOLAB
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE | 3 Months Ended |
Mar. 31, 2016 | |
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE | |
Earnings Attributable to Ecolab Per Common Share | 11. EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE The difference in the weighted average common shares outstanding for calculating basic and diluted earnings attributable to Ecolab per common share is a result of the dilution associated with the company’s equity compensation plans. As noted in the table below, certain stock options, units and awards outstanding under these equity compensation plans were not included in the computation of diluted earnings attributable to Ecolab per common share because they would not have had a dilutive effect. The computations of the basic and diluted earnings attributable to Ecolab per common share amounts were as follows: First Quarter Ended March 31 2016 2015 (millions, except per share amounts) Net income attributable to Ecolab $ $ Weighted-average common shares outstanding Basic Effect of dilutive stock options, units and awards Diluted Earnings attributable to Ecolab per common share Basic $ $ Diluted $ $ Anti-dilutive securities excluded from the computation of earnings per share |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2016 | |
INCOME TAXES | |
INCOME TAXES | 12. INCOME TAXES The company’s tax rate was 24.0% and 27.6% for the first quarter of 2016 and 2015, respectively. The changes in the company’s tax rate for the first quarter 2016 compared to first quarter of 2015 were primarily driven by the tax rate impact of discrete tax items and the permanent enactment of the R&D credit. The company recognized discrete tax net benefits of $ 4.8 million during the first quarter of 2016 and discrete tax net expense of $2.6 million during the first quarter of 2015. First quarter 2016 net benefits related to discrete tax items were driven primarily by the release of reserves for uncertain tax positions due to the expiration of statute of limitations in non-U.S. jurisdictions. First quarter 2015 net expense related to discrete tax items were driven primarily by the change to a deferred tax liability resulting from the Naperville facility transaction discussed further in Note 5. |
PENSION AND POSTRETIREMENT PLAN
PENSION AND POSTRETIREMENT PLANS | 3 Months Ended |
Mar. 31, 2016 | |
PENSION AND POSTRETIREMENT PLANS | |
PENSION AND POSTRETIREMENT PLANS | 13. PENSION AND POSTRETIREMENT PLANS The company has a non-contributory qualified defined benefit pension plan covering the majority of its U.S. employees. The company also has U.S. non-contributory non-qualified defined benefit plans, which provide for benefits to employees in excess of limits permitted under its U.S. pension plans. Various international subsidiaries also have defined benefit pension plans. The company provides postretirement health care benefits to certain U.S. employees and retirees. The components of net periodic pension and postretirement health care benefit costs for the first quarter ended March 31 are as follows: U.S. International U.S. Postretirement Pension Pension Health Care (millions) 2016 2015 2016 2015 2016 2015 Service cost $ $ $ $ $ $ Interest cost on benefit obligation Expected return on plan assets Recognition of net actuarial (gain) loss Amortization of prior service cost (benefit) - - Total expense $ $ $ $ $ $ As of March 31, 2016, the company is in compliance with all funding requirements of its U.S. pension and postretirement health care plans. During the first three months of 2016, the company made payments of $4 million to its U.S. non-contributory non-qualified defined benefit plans and estimates that it will make payments of approximately an additional $10 million to such plans during the remainder of 2016. Subsequent to the end of the first quarter of 2016, the company made a $150 million voluntary contribution to its non-contributory qualified U.S. pension plan. The company contributed $16 million to its international pension benefit plans during the first three months of 2016. The company estimates that it will contribute approximately an additional $26 million to the international pension benefit plans during the remainder of 2016. During the first three months of 2016, the company made payments of $4 million to its U.S. postretirement health care benefit plans and estimates that it will make payments of approximately an additional $13 million to such plans during the remainder of 2016. |
OPERATING SEGMENTS
OPERATING SEGMENTS | 3 Months Ended |
Mar. 31, 2016 | |
OPERATING SEGMENTS | |
OPERATING SEGMENTS AND GEOGRAPHIC INFORMATION | 14. OPERATING SEGMENTS The company’s organizational structure consists of global business unit and global regional leadership teams. The company’s ten operating units, which are also operating segments, follow its commercial and product-based activities and are based on engagement in business activities, availability of discrete financial information and review of operating results by the Chief Operating Decision Maker at the identified operating unit level. Eight of the company’s ten operating units have been aggregated into three reportable segments based on similar economic characteristics and future prospects, nature of the products and production processes, end-use markets, channels of distribution and regulatory environment. The company’s reportable segments are Global Industrial, Global Institutional and Global Energy. The company’s two operating units that are primarily fee-for-service businesses have been combined into the Other segment and do not meet the quantitative criteria to be separately reported. The company provides similar information for the Other segment as compared to its three reportable segments as the company considers the information regarding its two underlying operating units as useful in understanding its consolidated results. Comparability of Reportable Segments The company evaluates the performance of its non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminate the impact of exchange rate fluctuations on its international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollar at foreign currency exchange rates established by management, with all periods presented using such rates. Fixed currency rates are generally based on existing market rates at the time they are established. The “Fixed Currency Rate Change” column shown in the following table reflects the impact on previously reported values related to fixed currency exchange rates established by management at the beginning of 2016. Effective as of the end of the fourth quarter of 2015, the company deconsolidated its Venezuelan subsidiaries. Prior to deconsolidation, across the second through fourth quarters of 2015, the Venezuelan bolivar operations within the company’s Water, Paper, Food & Beverage, Institutional and Energy operating units were converted from the official exchange rate at the time of 6.3 bolivares to 1 U.S. dollar to the Marginal Currency System (“SIMADI”) rate of approximately 200 bolivares to 1 U.S. dollar. To present the company’s historical Venezuelan bolivar operations at a consistent conversion rate, the company recasted all of its Venezuelan bolivar results for the 2015 reporting year at the SIMADI conversion rate of approximately 200 bolivares to 1 U.S. dollar. Amounts reported in the “Venezuela Bolivar Impact” column shown in the following table represent the impact of Venezuelan bolivar rate conversion. Additionally, effective in the first quarter of 2016, the company made immaterial changes to its reportable segments, including the movement of certain customers between reportable segments. These changes are presented in the “Other” column of the following table. The impact of the preceding changes on previously reported full year 2015 reportable segment net sales and operating income is summarized as follows: December 31, 2015 Fixed Venezuela Values at Currency Bolivar Values at (millions) 2015 Rates Rate Change Impact Other 2016 Rates Net Sales Global Industrial $ $ $ $ $ Global Institutional Global Energy Other - - Subtotal at fixed currency rates - Effect of foreign currency translation - Consolidated $ $ - $ - $ - $ Operating Income Global Industrial $ $ $ $ $ Global Institutional Global Energy Other - Corporate - - Subtotal at fixed currency rates - Effect of foreign currency translation - Consolidated $ $ - $ - $ - $ Reportable Segment Information Financial information for each of the company’s reportable segments, including the impact of all preceding segment structure changes, is as follows: First Quarter Ended March 31 (millions) 2016 2015 Net Sales Global Industrial $ $ Global Institutional Global Energy Other Subtotal at fixed currency rates Effect of foreign currency translation Consolidated $ $ Operating Income Global Industrial $ Global Institutional Global Energy Other Corporate Subtotal at fixed currency rates Effect of foreign currency translation Consolidated $ $ The profitability of the company’s operating units is evaluated by management based on operating income. The company has no intersegment revenues. Consistent with the company’s internal management reporting, the Corporate segment includes amortization specifically from the Nalco merger. The Corporate segment also includes special (gains) and charges, as discussed in Note 2, reported within the Consolidated Statement of Income. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2016 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 15. COMMITMENTS AND CONTINGENCIES The company is subject to various claims and contingencies related to, among other things, workers’ compensation, general liability (including product liability), automobile claims, health care claims, environmental matters and lawsuits. The company also has contractual obligations related to lease commitments. Insurance Globally, the company has high deductible insurance policies for property and casualty losses. The company is insured for losses in excess of these deductibles, subject to policy terms and conditions and has recorded both a liability and an offsetting receivable for amounts in excess of these deductibles. The company is self-insured for health care claims for eligible participating employees, subject to certain deductibles and limitations. The company determines its liabilities for claims on an actuarial basis. Litigation and Environmental Matters The company and certain subsidiaries are party to various lawsuits, claims and environmental actions that have arisen in the ordinary course of business. These include from time to time antitrust, commercial, patent infringement, product liability and wage hour lawsuits, as well as possible obligations to investigate and mitigate the effects on the environment of the disposal or release of certain chemical substances at various sites, such as Superfund sites and other operating or closed facilities. The company has established accruals for certain lawsuits, claims and environmental matters. The company currently believes that there is not a reasonably possible risk of material loss in excess of the amounts accrued related to these legal matters. Because litigation is inherently uncertain, and unfavorable rulings or developments could occur, there can be no certainty that the company may not ultimately incur charges in excess of recorded liabilities. A future adverse ruling, settlement or unfavorable development could result in future charges that could have a material adverse effect on the company’s results of operations or cash flows in the period in which they are recorded. The company currently believes that such future charges related to suits and legal claims, if any, would not have a material adverse effect on the company’s consolidated financial position. Environmental Matters The company is currently participating in environmental assessments and remediation at approximately 40 locations, the majority of which are in the U.S., and environmental liabilities have been accrued reflecting management’s best estimate of future costs. Potential insurance reimbursements are not anticipated in the company’s accruals for environmental liabilities. Matters Related to Wage Hour Claims The company is a defendant in five pending wage hour lawsuits claiming violations of the Fair Labor Standards Act (“FLSA”) or a similar state law. Of these five suits, three have been certified for class action status. Ross (formerly Icard) v. Ecolab, U.S. District Court — Northern District of California, case no. C 13-05097 PJH, an action under California state law, has been certified for class treatment of California Institutional employees. The Court in Ross recently granted plaintiffs’ motion for partial summary judgment, finding that Institutional Route Sales Managers are not exempt from overtime pay under California wage and hour laws. The company appealed this judgment. The court has not determined damages; however the company has established an accrual, which is not material to its results of operations or financial position. This matter has been tentatively settled, subject to court approval. In Cancilla v. Ecolab, U.S. District Court - Northern District of California, case no. CV 12-03001, the Court conditionally certified a nationwide class of Pest Elimination Service Specialists for alleged FLSA violations. The suit also seeks a purported California sub-class for alleged California wage hour law violations and certifications of classes for state law violations in Washington, Colorado, Maryland, Illinois, Missouri, Wisconsin and North Carolina. The Cancilla lawsuit has been settled. The settlement amount, which was not material to the company’s operations or financial position, was paid in the first quarter of 2016. A third pending suit, Charlot v. Ecolab Inc., U.S. District Court-Eastern District of New York, case no. CV 12-04543, seeks nationwide class certification of Institutional employees for alleged FLSA violations as well as purported state sub-classes in New York, New Jersey, Washington and Pennsylvania alleging violations of state wage hour laws. The Court in Charlot recently granted the company’s motion for summary judgment against plaintiffs on the federal FLSA claims. Plaintiffs’ claims under state law remain pending and the judgment in favor of Ecolab may be subject to appeal by Plaintiffs. A fourth pending suit, Schneider v. Ecolab, United States District Court for the Northern District of Illinois, case no. 14 C 01044, seeks certification of a class of Institutional employees for alleged violations of Illinois wage and hour laws. In a fifth pending suit, Martino v. Ecolab, United States District Court for the Northern District of California, case no. 5:14-cv-04358-PSG, an action under California state law, the Court has certified a class of California Institutional Territory Managers alleging violation of state wage and hour laws. Matters Related to Deepwater Horizon Incident Response On April 22, 2010, the deepwater drilling platform, the Deepwater Horizon, operated by a subsidiary of BP plc, sank in the Gulf of Mexico after a catastrophic explosion and fire that began on April 20, 2010. A massive oil spill resulted. Approximately one week following the incident, subsidiaries of BP plc, under the authorization of the responding federal agencies, formally requested Nalco Company, now an indirect subsidiary of Ecolab, to supply large quantities of COREXIT® 9500, a Nalco oil dispersant product listed on the U.S. EPA National Contingency Plan Product Schedule. Nalco Company responded immediately by providing available COREXIT and increasing production to supply the product to BP’s subsidiaries for use, as authorized and directed by agencies of the federal government throughout the incident. Prior to the incident, Nalco and its subsidiaries had not provided products or services or otherwise had any involvement with the Deepwater Horizon platform. On July 15, 2010, BP announced that it had capped the leaking well, and the application of dispersants by the responding parties ceased shortly thereafter. On May 1, 2010, the President appointed retired U.S. Coast Guard Commandant Admiral Thad Allen to serve as the National Incident Commander in charge of the coordination of the response to the incident at the national level. The EPA directed numerous tests of all the dispersants on the National Contingency Plan Product Schedule, including those provided by Nalco Company, “to ensure decisions about ongoing dispersant use in the Gulf of Mexico are grounded in the best available science.” Nalco Company cooperated with this testing process and continued to supply COREXIT, as requested by BP and government authorities. After review and testing of a number of dispersants, on September 30, 2010, and on August 2, 2010, the EPA released toxicity data for eight oil dispersants. The use of dispersants by the responding parties was one tool used by the government and BP to avoid and reduce damage to the Gulf area from the spill. Since the spill occurred, the EPA and other federal agencies have closely monitored conditions in areas where dispersant was applied. Nalco Company has encouraged ongoing monitoring and review of COREXIT and other dispersants and has cooperated fully with the governmental review and approval process. However, in connection with its provision of COREXIT, Nalco Company has been named in several lawsuits as described below. Cases arising out of the Deepwater Horizon accident were administratively transferred for pre-trial purposes to a judge in the United States District Court for the Eastern District of Louisiana with other related cases under In Re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010, Case No. 10-md-02179 (E.D. La.) (“MDL 2179”). Putative Class Action Litigation Nalco Company was named, along with other unaffiliated defendants, in six putative class action complaints related to the Deepwater Horizon oil spill: Adams v. Louisiana, et al., Case No. 11-cv-01051 (E.D. La.); Elrod, et al. v. BP Exploration & Production Inc., et al., 12-cv-00981 (E.D. La.); Harris, et al. v. BP, plc, et al., Case No. 2:10-cv-02078-CJBSS (E.D. La.); Irelan v. BP Products, Inc., et al., Case No. 11-cv-00881 (E.D. La.); Petitjean, et al. v. BP, plc, et al., Case No. 3:10-cv-00316-RS-EMT (N.D. Fla.); and, Wright, et al. v. BP, plc, et al., Case No. 1:10-cv-00397-B (S.D. Ala.). The cases were filed on behalf of various potential classes of persons who live and work in or derive income from the effected Coastal region. Each of the actions contains substantially similar allegations, generally alleging, among other things, negligence relating to the use of our COREXIT dispersant in connection with the Deepwater Horizon oil spill. The plaintiffs in these putative class action lawsuits are generally seeking awards of unspecified compensatory and punitive damages, and attorneys’ fees and costs. These cases have been consolidated in MDL 2179. Other Related Claims Pending in MDL 2179 Nalco Company was also named, along with other unaffiliated defendants, in 23 complaints filed by individuals: Alexander, et al. v. BP Exploration & Production, et al., Case No. 11-cv-00951 (E.D. La.); Best v. British Petroleum plc, et al., Case No. 11-cv-00772 (E.D. La.); Black v. BP Exploration & Production, Inc., et al. Case No. 2:11-cv- 867, (E.D. La.); Brooks v. Tidewater Marine LLC, et al., Case No. 11-cv- 00049 (S.D. Tex.); Capt Ander, Inc. v. BP, plc, et al., Case No. 4:10-cv-00364-RH-WCS (N.D. Fla.); Coco v. BP Products North America, Inc., et al. (E.D. La.); Danos, et al. v. BP Exploration et al., Case No. 00060449 (25th Judicial Court, Parish of Plaquemines, Louisiana); Doom v. BP Exploration & Production, et al. , Case No. 12-cv-2048 (E.D. La.); Duong, et al., v. BP America Production Company, et al., Case No. 13-cv-00605 (E.D. La.); Esponge v. BP, P.L.C., et al., Case No. 0166367 (32nd Judicial District Court, Parish of Terrebonne, Louisiana); Ezell v. BP, plc, et al., Case No. 2:10-cv-01920-KDE-JCW (E.D. La.); Fitzgerald v. BP Exploration, et al., Case No. 13-cv-00650 (E.D. La.); Hill v. BP, plc, et al., Case No. 1:10-cv-00471-CG-N (S.D. Ala.); Hogan v. British Petroleum Exploration & Production, Inc., et al., Case No. 2012-22995 (District Court, Harris County, Texas); Hudley v. BP, plc, et al., Case No. 10-cv-00532-N (S.D. Ala.); In re of Jambon Supplier II, L.L.C., et al., Case No. 12-426 (E.D. La.); Kolian v. BP Exploration & Production, et al. , Case No. 12-cv-2338 (E.D. La.); Monroe v. BP, plc, et al., Case No. 1:10-cv-00472-M (S.D. Ala.); Pearson v. BP Exploration & Production, Inc., Case No. 2:11-cv-863, (E.D. La.); Shimer v. BP Exploration and Production, et al, Case No. 2:13-cv-4755 (E.D. La.); Top Water Charters, LLC v. BP, P.L.C., et al., No. 0165708 (32nd Judicial District Court, Parish of Terrebonne, Louisiana); Toups, et al. v Nalco Company, et al., Case No. 59-121 (25th Judicial District Court, Parish of Plaquemines, Louisiana); and, Trehern v. BP, plc, et al., Case No. 1:10-cv-00432-HSO-JMR (S.D. Miss.). The cases were filed on behalf of individuals and entities that own property, live, and/or work in or derive income from the effected Coastal region. Each of the actions contains substantially similar allegations, generally alleging, among other things, negligence relating to the use of our COREXIT dispersant in connection with the Deepwater Horizon oil spill. The plaintiffs in these lawsuits are generally seeking awards of unspecified compensatory and punitive damages, and attorneys’ fees and costs. Pursuant to orders issued by the court in MDL 2179, the claims were consolidated in several master complaints, including one naming Nalco Company and others who responded to the Gulf Oil Spill (known as the “B3 Master Complaint”). On May 18, 2012, Nalco filed a motion for summary judgment against the claims in the “B3” Master Complaint, on the grounds that: (i) Plaintiffs’ claims are preempted by the comprehensive oil spill response scheme set forth in the Clean Water Act and National Contingency Plan; and (ii) Nalco is entitled to derivative immunity from suit. On November 28, 2012, the Court granted Nalco’s motion and dismissed with prejudice the claims in the “B3” Master Complaint asserted against Nalco. The Court held that such claims were preempted by the Clean Water Act and National Contingency Plan. Because claims in the “B3” Master Complaint remain pending against other defendants, the Court’s decision is not a “final judgment” for purposes of appeal. Under Federal Rule of Appellate Procedure 4(a), plaintiffs will have 30 days after entry of final judgment to appeal the Court’s decision. Nalco Company, the incident defendants and the other responder defendants have been named as first party defendants by Transocean Deepwater Drilling, Inc. and its affiliates (the “Transocean Entities”) (In re the Complaint and Petition of Triton Asset Leasing GmbH, et al, MDL No. 2179, Civil Action 10-2771). In April and May 2011, the Transocean Entities, Cameron International Corporation, Halliburton Energy Services, Inc., M-I L.L.C., Weatherford U.S., L.P. and Weatherford International, Inc. (collectively, the “Cross Claimants”) filed cross claims in MDL 2179 against Nalco Company and other unaffiliated cross defendants. The Cross Claimants generally allege, among other things, that if they are found liable for damages resulting from the Deepwater Horizon explosion, oil spill and/or spill response, they are entitled to indemnity or contribution from the cross defendants. In April and June 2011, in support of its defense of the claims against it, Nalco Company filed counterclaims against the Cross Claimants. In its counterclaims, Nalco Company generally alleges that if it is found liable for damages resulting from the Deepwater Horizon explosion, oil spill and/or spill response, it is entitled to contribution or indemnity from the Cross Claimants. In December 2012 and January 2013, the MDL 2179 court issued final orders approving two settlements between BP and Plaintiffs’ Class Counsel: (1) a proposed Medical Benefits Class Action Settlement; and (2) a proposed Economic and Property Damages Class Action Settlement. Pursuant to the proposed settlements, class members agree to release claims against BP and other released parties, including Nalco Energy Services, LP, Nalco Holding Company, Nalco Finance Holdings LLC, Nalco Finance Holdings Inc., Nalco Holdings LLC and Nalco Company. Other Related Actions In March 2011, Nalco Company was named, along with other unaffiliated defendants, in an amended complaint filed by an individual in the Circuit Court of Harrison County, Mississippi, Second Judicial District (Franks v. Sea Tow of South Miss, Inc., et al., Cause No. A2402-10-228 (Circuit Court of Harrison County, Mississippi)). The amended complaint generally asserts, among other things, negligence and strict product liability claims relating to the plaintiff’s alleged exposure to chemical dispersants manufactured by Nalco Company. The plaintiff seeks unspecified compensatory damages, medical expenses, and attorneys’ fees and costs. Plaintiff’s allegations place him within the scope of the MDL 2179 Medical Benefits Class. In approving the Medical Benefits Settlement, the MDL 2179 Court barred Medical Benefits Settlement class members from prosecuting claims of injury from exposure to oil and dispersants related to the Response. As a result of the MDL court’s order, on April 11, 2013, the Mississippi court stayed proceedings in the Franks case. The Franks case was dismissed in May 2014. The company believes the claims asserted against Nalco Company are without merit and intends to defend these lawsuits vigorously. The company also believes that it has rights to contribution and/ or indemnification (including legal expenses) from third parties. However, the company cannot predict the outcome of these lawsuits, the involvement it might have in these matters in the future, or the potential for future litigation. |
NEW ACCOUNTING PRONOUNCEMENTS
NEW ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Mar. 31, 2016 | |
NEW ACCOUNTING PRONOUNCEMENTS | |
New Accounting Pronouncements | 16. NEW ACCOUNTING PRONOUNCEMENTS Date of Date of Effect on the Standard Issuance Description Adoption Financial Statements Standards that are not yet adopted: ASU 2016-01 - Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities January 2016 The amendment revises accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments. January 1, 2017 The company is currently evaluating the impact of adoption. ASU 2016-09 -Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting March 2016 The amendment includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. January 1, 2017 The company is currently evaluating the impact of adoption. ASU 2015-11 - Inventory (Topic 330): Simplifying the Measurement of Inventory July 2015 The amendment requires entities to measure inventory under the FIFO or average cost methods at the lower of cost or net realizable value. January 1, 2017 The company is currently evaluating the impact of adoption. ASU 2014-09 - Revenue from Contracts with Customers (Topic 606), ASU 2015-14 - Deferral of the Effective Date, ASU 2016-08 - Principal Versus Agent Considerations (Reporting Revenue Gross Versus Net), and ASU 2016-10 - Identifying Performance Obligations and Licensing August 2015 Recognition standard contains principles for entities to apply to determine the measurement of revenue and timing of when the revenue is recognized. The underlying principle of the updated guidance will have entities recognize revenue to depict the transfer of goods or services to customers at an amount that is expected to be received in exchange for those goods or services. January 1, 2018 The company is currently evaluating the impact of adoption. ASU 2016-02 - Leases (Topic 842) February 2016 Introduces the recognition of lease assets and lease liabilities by lessors for those leases classified as operating leases under previous guidance. January 1, 2019 The company is currently evaluating the impact of adoption. Standards that were adopted: ASU 2015-02 — Consolidation (Topic 810): Amendments to the Consolidation Analysis February 2015 Certain factors that previously required reporting entities to consolidate a given legal entity have been eliminated, requiring fewer legal entities to be consolidated under the new guidance. January 1, 2016 The adoption of the guidance did not have a material impact on the company's financial statements. ASU 2015-05 — Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40): Customer's Accounting for Fees Paid in a Cloud Computing Arrangement April 2015 An entity that is the customer in a cloud computing arrangement that includes a software license should account for the software license element of the arrangement consistent with the acquisition of other software licenses. January 1, 2016 The adoption of the guidance did not have a material impact on the company's financial statements. ASU 2015-07 - Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or its Equivalent) (a consensus of the Emerging Issues Taskforce) May 2015 Investments for which fair value is measured at net asset value per share (or its equivalent) using the practical expedient of ASC 820 should not be categorized in the fair value hierarchy. However, the reporting entity should continue to disclose information on such investments. January 1, 2016 Presentation impact related to year end 2016 pension plan asset disclosures. ASU 2015-16 - Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments September 2015 The amendment requires an acquirer to recognize adjustments identified during the measurement period in the reporting period in which the adjustment amounts are determined and to recognize a cumulative catch-up, if any, in the same period on the income statement as a result of the adjustment, calculated as if the accounting had been completed on the acquisition date. The amendment also requires an entity to present separately on the face of the income statement or disclose in the notes the amount of the cumulative adjustment by line item. January 1, 2016 The adoption of the guidance did not have a material impact on the company's financial statements. ASU 2015-17- Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes November 2015 The amendment requires that all deferred tax assets and liabilities be classified as non-current in the consolidated balance sheet. January 1, 2016 As discussed in Note 1, the company early-adopted the updated guidance in the first quarter of 2016, resulting in presentation related changes to its deferred tax assets and liabilities. |
SPECIAL (GAINS) AND CHARGES (Ta
SPECIAL (GAINS) AND CHARGES (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Restructuring Reserve: | |
Special (gains) and charges | First Quarter Ended March 31 (millions) 2016 2015 Cost of sales Restructuring charges $ - $ Special (gains) and charges Restructuring charges Champion integration costs - Nalco integration costs - Other - Subtotal Total special (gains) and charges $ $ |
Energy Restructuring Plan | |
Restructuring Reserve: | |
Restructuring charges and subsequent activity | Employee Termination Asset (millions) Costs Disposals Other Total 2013 - 2015 Activity Recorded expense and accrual $ $ $ $ Net cash payments Non-cash charges - - Effect of foreign currency translation - - Restructuring liability, December 31, 2015 - 2016 Activity Recorded expense and accrual - Net cash payments - Restructuring liability, March 31, 2016 $ $ - $ $ |
Combined Plan | |
Restructuring Reserve: | |
Restructuring charges and subsequent activity | Employee Termination Asset (millions) Costs Disposals Other Total 2011 - 2015 Activity Recorded net expense and accrual $ $ $ $ Net cash payments Non-cash net charges Effect of foreign currency translation - - Restructuring liability, December 31, 2015 - 2016 Activity Recorded accrual adjustment - Net cash payments - Effect of foreign currency translation - - Restructuring liability, March 31, 2016 $ $ - $ $ |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
ACQUISITIONS AND DISPOSITIONS | |
Schedule of assets acquired and liabilities assumed | First Quarter Ended March 31 2016 2015 (millions) Net tangible assets acquired $ $ Identifiable intangible assets Customer relationships Patents - Trademarks - Other technology - Total intangible assets Goodwill Total aggregate purchase price Acquisition related liabilities and contingent consideration Net cash paid for acquisitions, including acquisition related liabilities and contingent consideration $ $ |
BALANCE SHEET INFORMATION (Tabl
BALANCE SHEET INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
BALANCE SHEET INFORMATION | |
Balance Sheet Information | March 31 December 31 (millions) 2016 2015 Accounts receivable, net Accounts receivable $ $ Allowance for doubtful accounts Total $ $ Inventories Finished goods $ $ Raw materials and parts Inventories at FIFO cost FIFO cost to LIFO cost difference Total $ $ Other current assets Prepaid assets $ $ Taxes receivable Derivative assets Other current assets Total $ $ Property, plant and equipment, net Land $ $ Buildings and improvements Leasehold improvements Machinery and equipment Merchandising and customer equipment Capitalized software Construction in progress Accumulated depreciation Total $ $ Other intangible assets, net Intangible assets not subject to amortization Trade names $ $ Intangible assets subject to amortization Customer relationships $ $ Trademarks Patents Other technology Accumulated amortization Customer relationships Trademarks Patents Other technology Net intangible assets subject to amortization Total $ $ Other assets Deferred income taxes $ $ Pension Other Total $ $ March 31 December 31 (millions) 2016 2015 Other current liabilities Discounts and rebates $ $ Dividends payable Interest payable Taxes payable, other than income Derivative liabilities Restructuring Other Total $ $ Accumulated other comprehensive loss Unrealized gain (loss) on derivative financial instruments, net of tax $ $ Unrecognized pension and postretirement benefit expense, net of tax Cumulative translation, net of tax Total $ $ |
DEBT AND INTEREST (Tables)
DEBT AND INTEREST (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
DEBT AND INTEREST | |
Schedule of short-term debt obligations | March 31 December 31 2016 2015 (millions) Short-term debt Commercial paper $ $ Notes payable Long-term debt, current maturities Total $ $ |
Schedule of long-term debt obligations including current maturities | Maturity March 31 December 31 (millions) by Year 2016 2015 Long-term debt Description / 2016 Principal Amount Term loan ($0) 2016 $ - $ Series B private placement senior notes (€175 million) 2016 Five year 2011 senior notes ($1.25 billion) 2016 Five year 2012 senior notes ($500 million) 2017 Three year 2015 senior notes ($300 million) 2018 Series A private placement senior notes ($250 million) 2018 Three year 2016 senior notes ($400 million) 2019 - Five year 2015 senior notes ($300 million) 2020 Ten year 2011 senior notes ($1.25 billion) 2021 Series B private placement senior notes ($250 million) 2023 Seven year 2016 senior notes ($400 million) 2023 - Ten year 2015 senior notes (€575 million) 2025 Thirty year 2011 senior notes ($750 million) 2041 Capital lease obligations Other Total debt Long-term debt, current maturities Total long-term debt $ $ |
Schedule of interest expense and interest income | First Quarter Ended March 31 (millions) 2016 2015 Interest expense $ $ Interest income Interest expense, net $ $ |
GOODWILL AND OTHER INTANGIBLE28
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Changes in the carrying amount of goodwill | Global Global Global (millions) Industrial Institutional Energy Other Total December 31, 2015 $ $ $ $ $ Current year business combinations (a) - - - Prior year business combinations (b) - - Reclassifications (c) - - Effect of foreign currency translation March 31, 2016 $ $ $ $ $ (a) For 2016, none of the goodwill related to businesses acquired is expected to be tax deductible. (b) Represents purchase price allocation adjustments for 2015 acquisitions deemed preliminary as of December 31, 2015. (c) Represents immaterial reclassifications of beginning balances to conform to the current year presentation. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
FAIR VALUE MEASUREMENTS | |
Schedule of the carrying amount and estimated fair value of assets and liabilities measured on recurring basis | 2016 March 31 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Investments held in rabbi trusts $ $ $ - $ - Foreign currency forward contracts - - Interest rate swap contracts - - Contingent consideration - - Liabilities Foreign currency forward contracts - - Interest rate swap contracts - - Contingent consideration - - 2015 December 31 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Investments held in rabbi trusts $ $ $ - $ - Foreign currency forward contracts - - Contingent consideration - - Liabilities Foreign currency forward contracts - - Interest rate swap contracts - - Contingent consideration - - |
Schedule of changes in net fair value of contingent consideration | (millions) Contingent consideration, December 31, 2015 $ Amount recognized at transaction date - Losses (gains) recognized in earnings - Settlements - Foreign currency translation Contingent consideration, March 31, 2016 $ |
Schedule of carrying amount and estimated fair value of long-term debt | March 31 December 31 2016 2015 Carrying Fair Carrying Fair (millions) Amount Value Amount Value Long-term debt, including current maturities $ $ $ $ |
DERIVATIVES AND HEDGING TRANS30
DERIVATIVES AND HEDGING TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
DERIVATIVES AND HEDGING TRANSACTIONS | |
Impact on AOCI and earnings from derivative contracts qualified as cash flow hedges | First Quarter Ended March 31 2016 2015 (millions) Unrealized gain (loss) recognized into AOCI (effective portion) Foreign currency forward contracts AOCI (equity) $ $ Interest rate swap contracts AOCI (equity) Total Gain (loss) recognized in income (effective portion) Foreign currency forward contracts Cost of sales SG&A Interest expense, net - Total Interest rate swap contracts Interest expense, net Total $ $ |
Impact on earnings from derivative contracts that qualified as fair value hedges | First Quarter Ended March 31 2016 2015 (millions) Gain on derivative recognized income Interest rate swap Interest expense, net $ $ Loss on hedged item recognized income Interest rate swap Interest expense, net $ $ |
Revaluation gains and losses on euronotes and forward contracts | First Quarter Ended March 31 (millions) 2016 2015 Revaluation gains (losses), net of tax $ $ |
Impact on earnings from derivative contracts not designated as hedging instruments | First Quarter Ended March 31 (millions) 2016 2015 Gain (loss) recognized in income Foreign currency forward contracts SG&A $ $ Interest expense, net Total $ $ |
Gross fair value of the company's outstanding derivative assets and liabilities | Asset Derivatives Liability Derivatives (millions) March 31 December 31 March 31 December 31 2016 2015 2016 2015 Derivatives designated as hedging instruments: Foreign currency forward contracts $ $ $ $ Interest rate swap contracts - Derivatives not designated as hedging instruments: Foreign currency forward contracts Gross value of derivatives Gross amounts offset in the Consolidated Balance Sheet Net value of derivatives $ $ $ $ |
Summary of notional values of outstanding derivatives | Notional Values March 31 December 31 (millions) 2016 2015 Foreign currency forward contracts $ $ Interest rate swap agreements $ $ Net investment hedge contracts (a) € 25 € 25 (a) The net investment hedge contracts exclude the company’s euro denominated debt. |
OTHER COMPREHENSIVE INCOME (L31
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | |
Schedule of other comprehensive income information related to the Company's derivatives and hedging instruments and pension and postretirement benefits | First Quarter Ended March 31 (millions) 2016 2015 Derivative and Hedging Instruments Unrealized gains (losses) on derivative & hedging instruments Amount recognized in AOCI $ $ (Gains) losses reclassified from AOCI into income Cost of sales SG&A Interest expense, net Translation and other insignificant activity Tax impact Net of tax $ $ Pension and Postretirement Benefits Amount reclassified from AOCI into income Actuarial losses Prior service costs Tax impact Net of tax $ $ |
Summary of the net of tax derivative and pension and postretirement benefit amounts reclassified from AOCI into income | First Quarter Ended March 31 2016 2015 (millions) Derivative (gains) losses reclassified from AOCI into income, net of tax $ $ Pension and postretirement benefits net actuarial losses and prior services costs reclassified from AOCI into income, net of tax $ $ |
EARNINGS ATTRIBUTABLE TO ECOL32
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE | |
Computations of the basic and diluted earnings attributable to Ecolab per share amounts | First Quarter Ended March 31 2016 2015 (millions, except per share amounts) Net income attributable to Ecolab $ $ Weighted-average common shares outstanding Basic Effect of dilutive stock options, units and awards Diluted Earnings attributable to Ecolab per common share Basic $ $ Diluted $ $ Anti-dilutive securities excluded from the computation of earnings per share |
PENSION AND POSTRETIREMENT PL33
PENSION AND POSTRETIREMENT PLANS (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
PENSION AND POSTRETIREMENT PLANS | |
Net periodic pension and postretirement health care benefit costs | U.S. International U.S. Postretirement Pension Pension Health Care (millions) 2016 2015 2016 2015 2016 2015 Service cost $ $ $ $ $ $ Interest cost on benefit obligation Expected return on plan assets Recognition of net actuarial (gain) loss Amortization of prior service cost (benefit) - - Total expense $ $ $ $ $ $ |
OPERATING SEGMENTS (Tables)
OPERATING SEGMENTS (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
OPERATING SEGMENTS | |
Schedule of financial information for each of the entity's reportable segments, including the impact of the preceding changes on previously reported full year 2015 net sales and oeprating income | December 31, 2015 Fixed Venezuela Values at Currency Bolivar Values at (millions) 2015 Rates Rate Change Impact Other 2016 Rates Net Sales Global Industrial $ $ $ $ $ Global Institutional Global Energy Other - - Subtotal at fixed currency rates - Effect of foreign currency translation - Consolidated $ $ - $ - $ - $ Operating Income Global Industrial $ $ $ $ $ Global Institutional Global Energy Other - Corporate - - Subtotal at fixed currency rates - Effect of foreign currency translation - Consolidated $ $ - $ - $ - $ |
Schedule of financial information for each of the entity's reportable segments | First Quarter Ended March 31 (millions) 2016 2015 Net Sales Global Industrial $ $ Global Institutional Global Energy Other Subtotal at fixed currency rates Effect of foreign currency translation Consolidated $ $ Operating Income Global Industrial $ Global Institutional Global Energy Other Corporate Subtotal at fixed currency rates Effect of foreign currency translation Consolidated $ $ |
NEW ACCOUNTING PRONOUNCEMENTS (
NEW ACCOUNTING PRONOUNCEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
NEW ACCOUNTING PRONOUNCEMENTS | |
Schedule of new accounting pronouncements | Date of Date of Effect on the Standard Issuance Description Adoption Financial Statements Standards that are not yet adopted: ASU 2016-01 - Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities January 2016 The amendment revises accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. The ASU also amends certain disclosure requirements associated with the fair value of financial instruments. January 1, 2017 The company is currently evaluating the impact of adoption. ASU 2016-09 -Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting March 2016 The amendment includes provisions intended to simplify various aspects related to how share-based payments are accounted for and presented in the financial statements. January 1, 2017 The company is currently evaluating the impact of adoption. ASU 2015-11 - Inventory (Topic 330): Simplifying the Measurement of Inventory July 2015 The amendment requires entities to measure inventory under the FIFO or average cost methods at the lower of cost or net realizable value. January 1, 2017 The company is currently evaluating the impact of adoption. ASU 2014-09 - Revenue from Contracts with Customers (Topic 606), ASU 2015-14 - Deferral of the Effective Date, ASU 2016-08 - Principal Versus Agent Considerations (Reporting Revenue Gross Versus Net), and ASU 2016-10 - Identifying Performance Obligations and Licensing August 2015 Recognition standard contains principles for entities to apply to determine the measurement of revenue and timing of when the revenue is recognized. The underlying principle of the updated guidance will have entities recognize revenue to depict the transfer of goods or services to customers at an amount that is expected to be received in exchange for those goods or services. January 1, 2018 The company is currently evaluating the impact of adoption. ASU 2016-02 - Leases (Topic 842) February 2016 Introduces the recognition of lease assets and lease liabilities by lessors for those leases classified as operating leases under previous guidance. January 1, 2019 The company is currently evaluating the impact of adoption. Standards that were adopted: ASU 2015-02 — Consolidation (Topic 810): Amendments to the Consolidation Analysis February 2015 Certain factors that previously required reporting entities to consolidate a given legal entity have been eliminated, requiring fewer legal entities to be consolidated under the new guidance. January 1, 2016 The adoption of the guidance did not have a material impact on the company's financial statements. ASU 2015-05 — Intangibles - Goodwill and Other - Internal Use Software (Subtopic 350-40): Customer's Accounting for Fees Paid in a Cloud Computing Arrangement April 2015 An entity that is the customer in a cloud computing arrangement that includes a software license should account for the software license element of the arrangement consistent with the acquisition of other software licenses. January 1, 2016 The adoption of the guidance did not have a material impact on the company's financial statements. ASU 2015-07 - Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or its Equivalent) (a consensus of the Emerging Issues Taskforce) May 2015 Investments for which fair value is measured at net asset value per share (or its equivalent) using the practical expedient of ASC 820 should not be categorized in the fair value hierarchy. However, the reporting entity should continue to disclose information on such investments. January 1, 2016 Presentation impact related to year end 2016 pension plan asset disclosures. ASU 2015-16 - Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments September 2015 The amendment requires an acquirer to recognize adjustments identified during the measurement period in the reporting period in which the adjustment amounts are determined and to recognize a cumulative catch-up, if any, in the same period on the income statement as a result of the adjustment, calculated as if the accounting had been completed on the acquisition date. The amendment also requires an entity to present separately on the face of the income statement or disclose in the notes the amount of the cumulative adjustment by line item. January 1, 2016 The adoption of the guidance did not have a material impact on the company's financial statements. ASU 2015-17- Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes November 2015 The amendment requires that all deferred tax assets and liabilities be classified as non-current in the consolidated balance sheet. January 1, 2016 As discussed in Note 1, the company early-adopted the updated guidance in the first quarter of 2016, resulting in presentation related changes to its deferred tax assets and liabilities. |
SPECIAL (GAINS) AND CHARGES (De
SPECIAL (GAINS) AND CHARGES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Special (gains) and charges | ||
Subtotal | $ 6.3 | $ 7.8 |
Total special (gains) and charges | 6.3 | 8.4 |
Cost of sales | ||
Special (gains) and charges | ||
Restructuring charges | 0.6 | |
Subtotal | 0.6 | |
Special (gains) and charges | ||
Special (gains) and charges | ||
Restructuring charges | 3 | 2.1 |
Other | 3.3 | |
Subtotal | $ 6.3 | 7.8 |
Special (gains) and charges | Champion | ||
Special (gains) and charges | ||
Integration costs | 5.2 | |
Special (gains) and charges | Nalco | ||
Special (gains) and charges | ||
Integration costs | $ 0.5 |
SPECIAL (GAINS) AND CHARGES (37
SPECIAL (GAINS) AND CHARGES (Details 2) - USD ($) $ in Millions | 3 Months Ended | 36 Months Ended | 60 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2015 | |
Champion | ||||
Non-restructuring Special (Gains) and Charges | ||||
Business combination and integration related costs, pre tax | $ 5.2 | |||
Business combination and integration related costs, after tax | 3.2 | |||
Nalco | ||||
Non-restructuring Special (Gains) and Charges | ||||
Business combination and integration related costs, pre tax | 0.5 | |||
Business combination and integration related costs, after tax | 0.5 | |||
Energy Restructuring Plan | ||||
Restructuring reserve | ||||
Recorded expense and accrual | $ 2.9 | 1 | $ 84.1 | |
Net cash payments | (5.7) | (42.5) | ||
Non-cash charges | (17.1) | |||
Effect of foreign currency translation | 0.4 | |||
Restructuring liability | 22.1 | 24.9 | $ 24.9 | |
Other restructuring information | ||||
Restructuring charges, after tax | 1.7 | 0.8 | ||
Energy Restructuring Plan | Employee termination costs | ||||
Restructuring reserve | ||||
Recorded expense and accrual | (0.4) | 55.6 | ||
Net cash payments | (2.2) | (44.3) | ||
Effect of foreign currency translation | 0.4 | |||
Restructuring liability | 9.1 | 11.7 | 11.7 | |
Energy Restructuring Plan | Asset disposals | ||||
Restructuring reserve | ||||
Recorded expense and accrual | 13.2 | |||
Net cash payments | 3.9 | |||
Non-cash charges | (17.1) | |||
Energy Restructuring Plan | Other | ||||
Restructuring reserve | ||||
Recorded expense and accrual | 3.3 | 15.3 | ||
Net cash payments | (3.5) | (2.1) | ||
Restructuring liability | 13 | 13.2 | 13.2 | |
Combined Plan | ||||
Restructuring reserve | ||||
Recorded expense and accrual | 1.7 | 404.2 | ||
Recorded accrual adjustment | 0.1 | |||
Net cash payments | (11.1) | (303.1) | ||
Non-cash net charges | (26.5) | |||
Effect of foreign currency translation | 0.8 | (9.4) | ||
Restructuring liability | 55 | 65.2 | 65.2 | |
Other restructuring information | ||||
Restructuring charges, after tax | $ 0.8 | |||
Combined Plan | Employee termination costs | ||||
Restructuring reserve | ||||
Recorded expense and accrual | 349.7 | |||
Recorded accrual adjustment | (0.2) | |||
Net cash payments | (10.5) | (281.3) | ||
Non-cash net charges | 0.6 | |||
Effect of foreign currency translation | 0.8 | (9.4) | ||
Restructuring liability | 49.7 | 59.6 | 59.6 | |
Combined Plan | Asset disposals | ||||
Restructuring reserve | ||||
Recorded expense and accrual | 6.1 | |||
Net cash payments | 16.3 | |||
Non-cash net charges | (22.4) | |||
Combined Plan | Other | ||||
Restructuring reserve | ||||
Recorded expense and accrual | 48.4 | |||
Recorded accrual adjustment | 0.3 | |||
Net cash payments | (0.6) | (38.1) | ||
Non-cash net charges | (4.7) | |||
Restructuring liability | $ 5.3 | $ 5.6 | $ 5.6 |
ACQUISITIONS AND DISPOSITIONS38
ACQUISITIONS AND DISPOSITIONS (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Components of the aggregate purchase prices of the completed acquisitions | ||
Net tangible assets acquired | $ 13.7 | $ 1.1 |
Identifiable intangible assets | ||
Customer relationships | 2.5 | 0.6 |
Patents | 2.5 | |
Trademarks | 0.1 | |
Other technology | 0.2 | |
Total intangible assets | 2.5 | 3.4 |
Goodwill | 1.1 | 6.3 |
Total aggregate purchase price | 17.3 | 10.8 |
Acquisition related liabilities and contingent consideration | (5.5) | (0.1) |
Net cash paid for acquisitions, including acquisition related liabilities and contingent consideration | $ 11.8 | $ 10.7 |
Weighted average useful lives of identifiable intangible assets acquired | 5 years | 11 years |
BALANCE SHEET INFORMATION (Deta
BALANCE SHEET INFORMATION (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Accounts receivable, net | ||
Accounts receivable | $ 2,330 | $ 2,465.5 |
Allowance for doubtful accounts | (81.2) | (75.3) |
Total | 2,248.8 | 2,390.2 |
Inventories | ||
Finished goods | 957.4 | 929.6 |
Raw materials and parts | 423.8 | 440.9 |
Inventories at FIFO cost | 1,381.2 | 1,370.5 |
FIFO cost to LIFO cost difference | 4.9 | 17.7 |
Total | 1,386.1 | 1,388.2 |
Other current assets | ||
Prepaid assets | 115.2 | 94.6 |
Taxes receivable | 123.3 | 137.6 |
Derivative assets | 20.5 | 58.7 |
Other current assets | 32.5 | 35.4 |
Total | 291.5 | 326.3 |
Property, plant and equipment, net | ||
Land | 223.1 | 223.7 |
Buildings and improvements | 924.2 | 914.9 |
Leasehold improvements | 81.8 | 81.1 |
Machinery and equipment | 1,924.4 | 1,896.7 |
Merchandising and customer equipment | 2,042.6 | 1,988.1 |
Capitalized software | 486.4 | 479.9 |
Construction in progress | 372.5 | 371.1 |
Property, plant and equipment, gross | 6,055 | 5,955.5 |
Accumulated depreciation | (2,828) | (2,727.2) |
Total | 3,227 | 3,228.3 |
Cost of intangible assets subject to amortization: | ||
Other intangible assets, gross | 4,176.3 | 4,182.8 |
Accumulated amortization | (1,375.2) | (1,303.6) |
Net intangible assets subject to amortization | 2,801.1 | 2,879.2 |
Total | 4,031.1 | 4,109.2 |
Other assets | ||
Deferred income taxes | 91.1 | 58.3 |
Pension | 29.6 | 28 |
Other | 293.2 | 279.6 |
Total | 413.9 | 365.9 |
Other current liabilities | ||
Discounts and rebates | 272 | 270.5 |
Dividends payable | 102.9 | 103.6 |
Interest payable | 74 | 24.2 |
Taxes payable, other than income | 94.2 | 110.5 |
Derivative liabilities | 18.4 | 31.5 |
Restructuring | 62.6 | 73.9 |
Other | 298.7 | 334.1 |
Total | 922.8 | 948.3 |
Accumulated other comprehensive loss | ||
Unrealized gain (loss) on derivative financial instruments, net of tax | (1.5) | 9 |
Unrecognized pension and postretirement benefit expense, net of tax | (478.6) | (486.9) |
Cumulative translation, net of tax | (1,056) | (945.4) |
Total | (1,536.1) | (1,423.3) |
Customer relationships | ||
Cost of intangible assets subject to amortization: | ||
Other intangible assets, gross | 3,224 | 3,232.3 |
Accumulated amortization | (998.5) | (945.1) |
Trademarks | ||
Cost of intangible assets subject to amortization: | ||
Other intangible assets, gross | 303.4 | 303.6 |
Accumulated amortization | (110) | (104.7) |
Patents | ||
Cost of intangible assets subject to amortization: | ||
Other intangible assets, gross | 435.7 | 433.4 |
Accumulated amortization | (136.1) | (129) |
Other technology | ||
Cost of intangible assets subject to amortization: | ||
Other intangible assets, gross | 213.2 | 213.5 |
Accumulated amortization | (130.6) | (124.8) |
Trade names | ||
Cost of intangible assets not subject to amortization: | ||
Other intangible assets, gross | $ 1,230 | $ 1,230 |
DEBT AND INTEREST (Details)
DEBT AND INTEREST (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Components of the company's debt obligations | ||
Long-term debt, current maturities | $ 1,450.5 | $ 1,569.4 |
Short-term debt including current maturities of long-term debt | 1,756.6 | 2,205.3 |
Commercial paper. | ||
Components of the company's debt obligations | ||
Short-term debt | 284.5 | 605 |
U.S. commercial paper program | ||
Components of the company's debt obligations | ||
Maximum borrowing capacity, commercial paper | 2,000 | |
Outstanding commercial paper | 285 | 605 |
European commercial paper | ||
Components of the company's debt obligations | ||
Maximum borrowing capacity, commercial paper | 200 | |
Outstanding commercial paper | 0 | 0 |
Notes payable | ||
Components of the company's debt obligations | ||
Short-term debt | 21.6 | $ 30.9 |
Credit facility | ||
Components of the company's debt obligations | ||
Maximum borrowing capacity under the credit agreement | $ 2,000 |
DEBT AND INTEREST (Details 2)
DEBT AND INTEREST (Details 2) € in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | ||||||
Jan. 31, 2016USD ($) | Mar. 31, 2015USD ($) | Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | Mar. 31, 2016EUR (€) | Mar. 31, 2016USD ($) | Dec. 31, 2015EUR (€) | Dec. 31, 2015USD ($) | |
Debt instrument | ||||||||
CARRYING VALUE | $ 6,533.3 | $ 5,829.6 | ||||||
Long-term debt, current maturities | (1,450.5) | (1,569.4) | ||||||
Long-term debt | 5,082.8 | 4,260.2 | ||||||
Interest | ||||||||
Interest expense | $ 68.9 | $ 65.2 | ||||||
Interest income | (2.8) | (2.7) | ||||||
Interest expense, net | $ 66.1 | 62.5 | ||||||
Beneficial Interest in Trust, Naperville Facility | ||||||||
Components of the aggregate purchase prices of the completed acquisitions | ||||||||
Debt assumed | $ 100.2 | 100.2 | ||||||
Property, plant and equipment | 135.2 | $ 135.2 | ||||||
Cash consideration | $ 19.8 | |||||||
Term loan | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 125 | |||||||
Repayment of debt | $ 125 | |||||||
Series B senior euro notes, due 2016 | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 190.3 | 184.9 | ||||||
Aggregate principal amount | € | € 175 | € 175 | ||||||
Five year 2012 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 500.8 | 497.9 | ||||||
Aggregate principal amount | 500 | 500 | ||||||
Debt instrument, term | 5 years | |||||||
2016 Public Debt Offering | ||||||||
Debt instrument | ||||||||
Issuance of Debt securities | $ 800 | |||||||
Principal outstanding plus accrued unpaid interest payable at prepayment of notes (as a percent) | 101.00% | |||||||
Three year 2016 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 400.3 | |||||||
Aggregate principal amount | $ 400 | $ 400 | ||||||
Debt instrument, term | 3 years | 3 years | ||||||
Interest rate (as a percent) | 2.00% | 2.00% | 2.00% | |||||
Seven year 2016 Senior Notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | $ 396.8 | |||||||
Aggregate principal amount | $ 400 | $ 400 | ||||||
Debt instrument, term | 7 years | 7 years | ||||||
Interest rate (as a percent) | 3.25% | 3.25% | 3.25% | |||||
Three year 2015 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | $ 299.9 | 297.8 | ||||||
Aggregate principal amount | 300 | 300 | ||||||
Debt instrument, term | 3 years | |||||||
Five year 2015 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 298.3 | 298.1 | ||||||
Aggregate principal amount | 300 | 300 | ||||||
Debt instrument, term | 5 years | |||||||
Ten Year 2015 senior euro notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 619.6 | 601.8 | ||||||
Aggregate principal amount | € | € 575 | € 575 | ||||||
Debt instrument, term | 10 years | |||||||
Series A private placement senior notes due 2018 | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 251.7 | 248.6 | ||||||
Aggregate principal amount | 250 | 250 | ||||||
Series B private placement senior notes due 2023 | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 249.1 | 249.1 | ||||||
Aggregate principal amount | 250 | 250 | ||||||
Five year 2011 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 1,248.3 | 1,247.3 | ||||||
Aggregate principal amount | 1,250 | 1,250 | ||||||
Debt instrument, term | 5 years | |||||||
Ten year 2011 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 1,244 | 1,243.7 | ||||||
Aggregate principal amount | 1,250 | 1,250 | ||||||
Debt instrument, term | 10 years | |||||||
Thirty year 2011 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 738.4 | 738.3 | ||||||
Aggregate principal amount | 750 | 750 | ||||||
Debt instrument, term | 30 years | |||||||
Capital lease obligations | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 5.3 | 5.6 | ||||||
Other | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | $ 90.5 | $ 91.5 |
GOODWILL AND OTHER INTANGIBLE42
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | ||
Impairment of goodwill | $ 0 | |
Changes in the carrying amount of goodwill | ||
Beginning goodwill, net | 6,490.8 | |
Current year business combinations | 0.6 | |
Prior year business combinations | 0.5 | |
Effect of foreign currency translation | (17) | |
Ending goodwill, net | 6,474.9 | |
Goodwill expected to be tax deductible | 0 | |
Impairment of goodwill | 0 | |
Indefinite-Lived Intangible Assets (Excluding Goodwill) [Abstract] | ||
Total amortization expense related to other intangible assets | 72.6 | $ 73.1 |
Nalco | Trademarks | ||
Changes in the carrying amount of goodwill | ||
Impairment of indefinite life intangible asset | 0 | |
Global Industrial | ||
Changes in the carrying amount of goodwill | ||
Beginning goodwill, net | 2,560.8 | |
Prior year business combinations | 0.6 | |
Reclassifications | 3.5 | |
Effect of foreign currency translation | (6.7) | |
Ending goodwill, net | 2,558.2 | |
Global Institutional | ||
Changes in the carrying amount of goodwill | ||
Beginning goodwill, net | 662.7 | |
Reclassifications | (0.6) | |
Effect of foreign currency translation | (1.7) | |
Ending goodwill, net | 660.4 | |
Global Energy | ||
Changes in the carrying amount of goodwill | ||
Beginning goodwill, net | 3,151.5 | |
Current year business combinations | 0.6 | |
Prior year business combinations | (0.1) | |
Reclassifications | (2.9) | |
Effect of foreign currency translation | (8.3) | |
Ending goodwill, net | 3,140.8 | |
Other | ||
Changes in the carrying amount of goodwill | ||
Beginning goodwill, net | 115.8 | |
Effect of foreign currency translation | (0.3) | |
Ending goodwill, net | $ 115.5 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - Recurring - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Level 1 | ||
Assets: | ||
Investments held in rabbi trusts | $ 1.2 | $ 2 |
Level 2 | ||
Assets: | ||
Foreign currency forward contracts | 77.8 | 111.2 |
Interest rate swap contracts | 8.7 | |
Liabilities: | ||
Foreign currency forward contracts | 32.3 | 35.9 |
Interest rate swap contracts | 9.2 | 5.4 |
Level 3 | ||
Assets: | ||
Contingent consideration | 0.3 | 0.3 |
Liabilities: | ||
Contingent consideration | 15.5 | 15.9 |
Carrying Amount | ||
Assets: | ||
Investments held in rabbi trusts | 1.2 | 2 |
Foreign currency forward contracts | 77.8 | 111.2 |
Interest rate swap contracts | 8.7 | |
Contingent consideration | 0.3 | 0.3 |
Liabilities: | ||
Foreign currency forward contracts | 32.3 | 35.9 |
Interest rate swap contracts | 9.2 | 5.4 |
Contingent consideration | $ 15.5 | $ 15.9 |
FAIR VALUE MEASUREMENTS (Deta44
FAIR VALUE MEASUREMENTS (Details 2) $ in Millions | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Changes in liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) | |
Contingent consideration at beginning of year | $ 15.6 |
Foreign currency translation | (0.4) |
Contingent consideration at end of year | $ 15.2 |
FAIR VALUE MEASUREMENTS (Deta45
FAIR VALUE MEASUREMENTS (Details 3) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Carrying Amount | ||
Carrying amount and fair value of financial instruments | ||
Long-term debt (including current maturities) | $ 6,533.3 | $ 5,829.6 |
Fair Value | ||
Carrying amount and fair value of financial instruments | ||
Long-term debt (including current maturities) | $ 6,883.1 | $ 6,113.6 |
DERIVATIVES AND HEDGING TRANS46
DERIVATIVES AND HEDGING TRANSACTIONS - Derivative Positions Summary (Details) € in Millions, $ in Millions | Mar. 31, 2016EUR (€) | Mar. 31, 2016USD ($) | Dec. 31, 2015EUR (€) | Dec. 31, 2015USD ($) |
Asset Derivatives | ||||
Gross value of derivatives | $ 86.5 | $ 111.2 | ||
Gross amounts offset in the Consolidated Balance Sheet | (23.1) | (9.8) | ||
Net value of derivatives presented in the Consolidated Balance Sheet | 63.4 | 101.4 | ||
Liability Derivatives | ||||
Gross value of derivatives | 41.5 | 41.3 | ||
Gross amounts offset in the Consolidated Balance Sheet | (23.1) | (9.8) | ||
Net value of derivatives presented in the Consolidated Balance Sheet | 18.4 | 31.5 | ||
Net Investment Hedges | ||||
Liability Derivatives | ||||
Notional values | € | € 25 | € 25 | ||
Foreign currency forward contracts. | ||||
Liability Derivatives | ||||
Notional values | 4,000 | 4,000 | ||
Interest rate swaps | ||||
Liability Derivatives | ||||
Notional values | 1,950 | 1,675 | ||
Derivatives designated as hedging instruments | Foreign currency forward contracts. | ||||
Asset Derivatives | ||||
Gross value of derivatives | 57.8 | 70.2 | ||
Liability Derivatives | ||||
Gross value of derivatives | 7 | 3.2 | ||
Derivatives designated as hedging instruments | Interest rate swaps | ||||
Asset Derivatives | ||||
Gross value of derivatives | 8.7 | |||
Liability Derivatives | ||||
Gross value of derivatives | 9.2 | 5.4 | ||
Derivatives not designated as hedging instruments | Foreign currency forward contracts. | ||||
Asset Derivatives | ||||
Gross value of derivatives | 20 | 41 | ||
Liability Derivatives | ||||
Gross value of derivatives | $ 25.3 | $ 32.7 |
DERIVATIVES AND HEDGING TRANS47
DERIVATIVES AND HEDGING TRANSACTIONS - Information by Type of Derivative and Hedging Activities (Details) € in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||
Mar. 31, 2016EUR (€) | Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2015EUR (€) | Dec. 31, 2006contract | Mar. 31, 2016USD ($) | Jan. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Jan. 31, 2015USD ($) | May. 31, 2014USD ($) | |
DERIVATIVES AND HEDGING TRANSACTIONS | ||||||||||
Maximum period for hedged transactions | 3 years | 3 years | ||||||||
Number of interest rate swap contracts entered into and subsequently closed | contract | 2 | |||||||||
Net Investment Hedge: | ||||||||||
Revaluation gain (loss), net of tax | $ (15) | $ 57 | ||||||||
Three year 2016 senior notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | $ 400 | $ 400 | ||||||||
Interest rate (as a percent) | 2.00% | 2.00% | 2.00% | |||||||
Three year 2015 senior notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | $ 300 | $ 300 | ||||||||
Series A private placement senior notes due 2018 | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | 250 | 250 | ||||||||
Five year 2011 senior notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | 1,250 | 1,250 | ||||||||
Five year 2012 senior notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | 500 | 500 | ||||||||
Ten Year 2015 senior euro notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | € | € 575 | € 575 | ||||||||
Foreign currency forward contracts. | ||||||||||
Net Investment Hedge: | ||||||||||
Notional values | 4,000 | 4,000 | ||||||||
Interest rate swaps | ||||||||||
Net Investment Hedge: | ||||||||||
Notional values | $ 1,950 | $ 1,675 | ||||||||
Cash Flow Hedges | Derivatives designated as hedging instruments | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Unrealized gain (loss) recognized into AOCI (effective portion) | (12) | 10.9 | ||||||||
Cash Flow Hedges | Foreign currency forward contracts. | Derivatives designated as hedging instruments | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) reclassified from AOCI into income (effective portion) | 3.6 | 5.3 | ||||||||
Cash Flow Hedges | Foreign currency forward contracts. | Derivatives designated as hedging instruments | AOCI (equity) | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Unrealized gain (loss) recognized into AOCI (effective portion) | (3.7) | 25.3 | ||||||||
Cash Flow Hedges | Foreign currency forward contracts. | Derivatives designated as hedging instruments | Cost of sales | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) reclassified from AOCI into income (effective portion) | 12.7 | 4.8 | ||||||||
Cash Flow Hedges | Foreign currency forward contracts. | Derivatives designated as hedging instruments | Selling, general and administrative expenses | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) reclassified from AOCI into income (effective portion) | (10.6) | 0.5 | ||||||||
Cash Flow Hedges | Foreign currency forward contracts. | Derivatives designated as hedging instruments | Interest expense, net | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) reclassified from AOCI into income (effective portion) | 1.5 | |||||||||
Cash Flow Hedges | Foreign currency forward contracts. | Derivatives not designated as hedging instruments | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivative recognized in income | (33.1) | (0.1) | ||||||||
Cash Flow Hedges | Foreign currency forward contracts. | Derivatives not designated as hedging instruments | Selling, general and administrative expenses | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivative recognized in income | (32.6) | 4.8 | ||||||||
Cash Flow Hedges | Foreign currency forward contracts. | Derivatives not designated as hedging instruments | Interest expense, net | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivative recognized in income | (0.5) | (4.9) | ||||||||
Cash Flow Hedges | Interest rate swaps | Derivatives designated as hedging instruments | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) reclassified from AOCI into income (effective portion) | 2 | 4.1 | ||||||||
Cash Flow Hedges | Interest rate swaps | Derivatives designated as hedging instruments | AOCI (equity) | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Unrealized gain (loss) recognized into AOCI (effective portion) | (8.3) | (14.4) | ||||||||
Cash Flow Hedges | Interest rate swaps | Derivatives designated as hedging instruments | Interest expense, net | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) reclassified from AOCI into income (effective portion) | (1.6) | (1.2) | ||||||||
Fair Value Hedges | Interest rate swaps | Three year 2016 senior notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | $ 400 | |||||||||
Interest rate (as a percent) | 2.00% | |||||||||
Fair Value Hedges | Interest rate swaps | Three year 2015 senior notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | $ 300 | |||||||||
Interest rate (as a percent) | 1.55% | |||||||||
Fair Value Hedges | Interest rate swaps | Series A private placement senior notes due 2018 | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | $ 250 | |||||||||
Interest rate (as a percent) | 3.69% | |||||||||
Fair Value Hedges | Interest rate swaps | Five year 2011 senior notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Aggregate principal amount | $ 1,250 | $ 500 | ||||||||
Interest rate (as a percent) | 3.00% | 1.45% | ||||||||
Fair Value Hedges | Interest rate swaps | Interest expense, net | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivative recognized in income | 10.7 | 1 | ||||||||
Gain (loss) on hedged item recognized in income | (10.7) | (1) | ||||||||
Net Investment Hedges | ||||||||||
Net Investment Hedge: | ||||||||||
Notional values | € | 25 | 25 | ||||||||
Revaluation gain (loss), net of tax | (15) | $ 57 | ||||||||
Net Investment Hedges | Senior euro notes | ||||||||||
Net Investment Hedge: | ||||||||||
Euro-denominated debt outstanding | $ 816 | |||||||||
Net Investment Hedges | Ten Year 2015 senior euro notes | ||||||||||
Net Investment Hedge: | ||||||||||
Euro-denominated debt outstanding | € | 575 | |||||||||
Net Investment Hedges | Series B private placement senior euro notes, due 2016 | ||||||||||
Net Investment Hedge: | ||||||||||
Euro-denominated debt outstanding | € | € 175 | |||||||||
Net Investment Hedges | Foreign currency forward contract 2 | ||||||||||
Net Investment Hedge: | ||||||||||
Notional values | € | 490 | |||||||||
Notional contract amount closed | € | 105 | |||||||||
Net Investment Hedges | Foreign currency forward contract 2 | Derivatives designated as hedging instruments | ||||||||||
Net Investment Hedge: | ||||||||||
Notional amount de-designated | € | 360 | |||||||||
Net Investment Hedges | Foreign currency forward contract 2 | Derivatives not designated as hedging instruments | ||||||||||
Net Investment Hedge: | ||||||||||
Notional values | € | € 360 |
OTHER COMPREHENSIVE INCOME (L48
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Reclassification adjustments | ||
Cost of sales | $ (1,631.4) | $ (1,765.3) |
SG&A | (1,088.2) | (1,136.8) |
Interest expense, net | (66.1) | (62.5) |
Subtotal | (116.2) | (236.6) |
Derivative (gains) losses reclassified from AOCI into income, net of tax | (1.8) | (3.2) |
Pension and postretirement net actuarial loss and prior service cost reclassified from AOCI into income, net of tax | 5.6 | 8 |
Derivative & Hedging Instruments. | ||
Reclassification adjustments | ||
Amount recognized in AOCI | (12) | 10.9 |
Translation & other insignificant activity | 0.8 | (0.4) |
Tax impact | 2.7 | 1.4 |
Subtotal | (10.5) | 7.8 |
Derivative & Hedging Instruments. | Amount reclassified from AOCI | ||
Reclassification adjustments | ||
Cost of sales | (12.7) | (4.8) |
SG&A | 10.6 | (0.5) |
Interest expense, net | 0.1 | 1.2 |
(Gains) losses reclassified from AOCI into income | (2) | (4.1) |
Pension & Postretirement Benefits. | ||
Reclassification adjustments | ||
Tax impact | (3.3) | (4.8) |
Subtotal | 5.6 | 8 |
Pension & Postretirement Benefits. | Amount reclassified from AOCI | ||
Reclassification adjustments | ||
(Gains) losses reclassified from AOCI into income | 8.9 | 12.8 |
Actuarial losses | Amount reclassified from AOCI | ||
Reclassification adjustments | ||
(Gains) losses reclassified from AOCI into income | 10.9 | 14.5 |
Prior service costs | Amount reclassified from AOCI | ||
Reclassification adjustments | ||
(Gains) losses reclassified from AOCI into income | $ (2) | $ (1.7) |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||
Feb. 29, 2016 | Apr. 30, 2015 | Feb. 28, 2015 | Aug. 31, 2011 | Mar. 31, 2016 | Dec. 31, 2015 | |
Shareholder's Equity | ||||||
Authorized amount of share repurchase program | $ 1,000 | |||||
Remaining authorized amount of share repurchase program | $ 8 | |||||
Common Stock | ||||||
Shareholder's Equity | ||||||
Common stock, shares authorized to be repurchased | 20,000,000 | |||||
Amount of common stock to be repurchased under ASR agreement | $ 300 | $ 300 | ||||
Shares received under ASR agreement | 2,459,490 | 555,511 | 2,066,293 | |||
Shares received under the ASR agreement compared to the shares the company expected to receive (as a percent) | 85.00% | 80.00% | ||||
Remaining shares authorized to be repurchased | 19,752,942 | |||||
Reacquired shares | 3,297,674 | 6,267,699 | ||||
Number of shares reacquired through the open market | 3,145,617 | |||||
Number of shares that have been repurchased through the exercise of stock options and vesting of stock awards | 152,057 | 398,704 | ||||
Common Stock | Nalco | ||||||
Shareholder's Equity | ||||||
Additional shares authorized to be repurchased contingent upon merger | 10,000,000 |
EARNINGS ATTRIBUTABLE TO ECOL50
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Computations of the basic and diluted earnings attributable to Ecolab per share amounts | ||
Net income attributable to Ecolab | $ 230.8 | $ 233.4 |
Weighted-average common shares outstanding | ||
Basic (in shares) | 294.4 | 298.2 |
Effect of dilutive stock options, units and awards (in shares) | 3.9 | 5 |
Diluted (in shares) | 298.3 | 303.2 |
Earnings attributable to Ecolab per common share | ||
Basic (in dollars per share) | $ 0.78 | $ 0.78 |
Diluted (in dollars per share) | $ 0.77 | $ 0.77 |
Anti-dilutive stock options, units and awards excluded from computation of earnings per share (in shares) | 3.6 | 1.9 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
INCOME TAXES | ||
Effective income tax rate (as a percent) | 24.00% | 27.60% |
Recognized discrete tax expense (benefit), net | $ (4.8) | $ 2.6 |
PENSION AND POSTRETIREMENT PL52
PENSION AND POSTRETIREMENT PLANS (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | |
Apr. 30, 2016 | Mar. 31, 2016 | Mar. 31, 2015 | |
U.S. Pension | |||
Net periodic benefit costs | |||
Service cost- employee benefits earned during the year | $ 16.8 | $ 19.1 | |
Interest cost on benefit obligation | 20.4 | 22.8 | |
Expected return on plan assets | (35.9) | (33.2) | |
Recognition of net actuarial (gain) loss | 7.7 | 12.1 | |
Amortization of prior service cost (benefit) | (1.7) | (1.7) | |
Total expense | 7.3 | 19.1 | |
Other Pension Plan Information | |||
Contributions to plan | 4 | ||
Contributions anticipated to be made during the remainder of 2016 | 10 | ||
U.S. Pension | Subsequent event | |||
Other Pension Plan Information | |||
Contributions to plan | $ 150 | ||
International Pension | |||
Net periodic benefit costs | |||
Service cost- employee benefits earned during the year | 6.9 | 8.5 | |
Interest cost on benefit obligation | 8 | 10.3 | |
Expected return on plan assets | (13.5) | (14.1) | |
Recognition of net actuarial (gain) loss | 3.6 | 4 | |
Amortization of prior service cost (benefit) | (0.2) | ||
Total expense | 4.8 | 8.7 | |
Other Pension Plan Information | |||
Contributions to plan | 16 | ||
Contributions anticipated to be made during the remainder of 2016 | 26 | ||
U.S. Postretirement Health Care | |||
Net periodic benefit costs | |||
Service cost- employee benefits earned during the year | 0.8 | 0.9 | |
Interest cost on benefit obligation | 2 | 2.4 | |
Expected return on plan assets | (0.2) | (0.2) | |
Recognition of net actuarial (gain) loss | (0.4) | (1.6) | |
Amortization of prior service cost (benefit) | (0.1) | ||
Total expense | 2.1 | $ 1.5 | |
Other Pension Plan Information | |||
Contributions to plan | 4 | ||
Contributions anticipated to be made during the remainder of 2016 | $ 13 |
OPERATING SEGMENTS (Details)
OPERATING SEGMENTS (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016USD ($)segment | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | |
Financial information of reportable segments | |||
Number of operating segments aggregated for classification as reportable segments | segment | 8 | ||
Number of operating units | segment | 10 | ||
Number of reportable segments | segment | 3 | ||
Net sales | $ 3,097.4 | $ 3,297.6 | $ 13,545.1 |
Operating Income (Loss) | $ 371.5 | 387.7 | $ 1,561.3 |
SIMADI | VENEZUELA | |||
Financial information of reportable segments | |||
Exchange rate | 200 | ||
Previously Reported | |||
Financial information of reportable segments | |||
Net sales | $ 13,545.1 | ||
Operating Income (Loss) | $ 1,561.3 | ||
Previously Reported | VENEZUELA | |||
Financial information of reportable segments | |||
Exchange rate | 6.3 | ||
Other | |||
Financial information of reportable segments | |||
Number of operating units | segment | 2 | ||
Operating segment | |||
Financial information of reportable segments | |||
Net sales | $ 3,075.4 | 3,075.7 | $ 12,914.3 |
Operating Income (Loss) | 367.3 | 345.6 | 1,432.2 |
Operating segment | Previously Reported | |||
Financial information of reportable segments | |||
Net sales | 13,850.1 | ||
Operating Income (Loss) | 1,605.3 | ||
Operating segment | Adjustment | Fixed Currency Rate Change | |||
Financial information of reportable segments | |||
Net sales | (783.2) | ||
Operating Income (Loss) | (112.3) | ||
Operating segment | Adjustment | Venezuela Bolivar Impact | |||
Financial information of reportable segments | |||
Net sales | (152.6) | ||
Operating Income (Loss) | (60.8) | ||
Operating segment | Global Industrial | |||
Financial information of reportable segments | |||
Net sales | 1,079.1 | 1,037.7 | 4,485.5 |
Operating Income (Loss) | 128.7 | 102.6 | 626.4 |
Operating segment | Global Industrial | Previously Reported | |||
Financial information of reportable segments | |||
Net sales | 4,857.8 | ||
Operating Income (Loss) | 692.7 | ||
Operating segment | Global Industrial | Adjustment | Fixed Currency Rate Change | |||
Financial information of reportable segments | |||
Net sales | (332.8) | ||
Operating Income (Loss) | (48.7) | ||
Operating segment | Global Industrial | Adjustment | Venezuela Bolivar Impact | |||
Financial information of reportable segments | |||
Net sales | (48.4) | ||
Operating Income (Loss) | (19.6) | ||
Operating segment | Global Industrial | Adjustment | Other | |||
Financial information of reportable segments | |||
Net sales | 8.9 | ||
Operating Income (Loss) | 2 | ||
Operating segment | Global Institutional | |||
Financial information of reportable segments | |||
Net sales | 1,048.7 | 975.2 | 4,210.9 |
Operating Income (Loss) | 196.1 | 166.3 | 876.6 |
Operating segment | Global Institutional | Previously Reported | |||
Financial information of reportable segments | |||
Net sales | 4,393.2 | ||
Operating Income (Loss) | 900.7 | ||
Operating segment | Global Institutional | Adjustment | Fixed Currency Rate Change | |||
Financial information of reportable segments | |||
Net sales | (170.5) | ||
Operating Income (Loss) | (22.8) | ||
Operating segment | Global Institutional | Adjustment | Venezuela Bolivar Impact | |||
Financial information of reportable segments | |||
Net sales | (3.6) | ||
Operating Income (Loss) | (0.3) | ||
Operating segment | Global Institutional | Adjustment | Other | |||
Financial information of reportable segments | |||
Net sales | (8.2) | ||
Operating Income (Loss) | (1) | ||
Operating segment | Global Energy | |||
Financial information of reportable segments | |||
Net sales | 760 | 890.8 | 3,470.8 |
Operating Income (Loss) | 60.4 | 104.2 | 465.5 |
Operating segment | Global Energy | Previously Reported | |||
Financial information of reportable segments | |||
Net sales | 3,825.7 | ||
Operating Income (Loss) | 550.7 | ||
Operating segment | Global Energy | Adjustment | Fixed Currency Rate Change | |||
Financial information of reportable segments | |||
Net sales | (253.6) | ||
Operating Income (Loss) | (44.2) | ||
Operating segment | Global Energy | Adjustment | Venezuela Bolivar Impact | |||
Financial information of reportable segments | |||
Net sales | (100.6) | ||
Operating Income (Loss) | (40.9) | ||
Operating segment | Global Energy | Adjustment | Other | |||
Financial information of reportable segments | |||
Net sales | (0.7) | ||
Operating Income (Loss) | (0.1) | ||
Operating segment | Other | |||
Financial information of reportable segments | |||
Net sales | 187.6 | 172 | 747.1 |
Operating Income (Loss) | 30.1 | 23.1 | 127.5 |
Operating segment | Other | Previously Reported | |||
Financial information of reportable segments | |||
Net sales | 773.4 | ||
Operating Income (Loss) | 132 | ||
Operating segment | Other | Adjustment | Fixed Currency Rate Change | |||
Financial information of reportable segments | |||
Net sales | (26.3) | ||
Operating Income (Loss) | (3.6) | ||
Operating segment | Other | Adjustment | Other | |||
Financial information of reportable segments | |||
Operating Income (Loss) | (0.9) | ||
Currency impact | |||
Financial information of reportable segments | |||
Net sales | 22 | 221.9 | 630.8 |
Operating Income (Loss) | 4.2 | 42.1 | 129.1 |
Currency impact | Previously Reported | |||
Financial information of reportable segments | |||
Net sales | (305) | ||
Operating Income (Loss) | (44) | ||
Currency impact | Adjustment | Fixed Currency Rate Change | |||
Financial information of reportable segments | |||
Net sales | 783.2 | ||
Operating Income (Loss) | 112.3 | ||
Currency impact | Adjustment | Venezuela Bolivar Impact | |||
Financial information of reportable segments | |||
Net sales | 152.6 | ||
Operating Income (Loss) | 60.8 | ||
Corporate | |||
Financial information of reportable segments | |||
Operating Income (Loss) | (48) | $ (50.6) | (663.8) |
Corporate | Previously Reported | |||
Financial information of reportable segments | |||
Operating Income (Loss) | (670.8) | ||
Corporate | Adjustment | Fixed Currency Rate Change | |||
Financial information of reportable segments | |||
Operating Income (Loss) | $ 7 | ||
Intersegment | |||
Financial information of reportable segments | |||
Net sales | $ 0 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 3 Months Ended |
Mar. 31, 2016complaintlocationitemlawsuit | |
Environmental matters | |
Number of locations for environmental assessments and remediation | location | 40 |
Loss contingencies | |
Number of open wage hour lawsuits | lawsuit | 5 |
Number of complaints filed by individuals | 23 |
Period to appeal court's decision after entry of final judgment under Federal Rule of Appellate Procedure | 30 days |
Wage Hour Claims | |
Loss contingencies | |
Number of lawsuits certified for class action status | lawsuit | 3 |
Deepwater Horizon Incident | Nalco | |
Loss contingencies | |
Number of oil dispersants for which the EPA released toxicity data | 8 |
Number of putative class action complaints filed | 6 |
Number of master complaints naming Nalco and others who responded to the oil spill (known as the "B3 Bundle") | complaint | 1 |
Number of proposed class action settlements | 2 |