Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2021shares | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Transition Report | false |
Document Period End Date | Sep. 30, 2021 |
Entity File Number | 1-9328 |
Entity Registrant Name | ECOLAB INC. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 41-0231510 |
Entity Address, Address Line One | 1 Ecolab Place |
Entity Address, City or Town | St. Paul |
Entity Address, State or Province | MN |
Entity Address, Postal Zip Code | 55102 |
City Area Code | 800 |
Local Phone Number | 232-6522 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 286,567,307 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | Q3 |
Entity Central Index Key | 0000031462 |
Amendment Flag | false |
Common Stock | |
Title of 12(b) Security | Common Stock, $1.00 par value |
Trading Symbol | ECL |
Security Exchange Name | NYSE |
2.625% Euro Notes due 2025 | |
Title of 12(b) Security | 2.625% Euro Notes due 2025 |
Trading Symbol | ECL 25 |
Security Exchange Name | NYSE |
1.000% Euro Notes due 2024 | |
Title of 12(b) Security | 1.000% Euro Notes due 2024 |
Trading Symbol | ECL 24 |
Security Exchange Name | NYSE |
CONSOLIDATED STATEMENT OF INCOM
CONSOLIDATED STATEMENT OF INCOME - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Net sales | $ 3,320.8 | $ 3,018.6 | $ 9,368.5 | $ 8,724.9 |
Cost of sales (including special charges (a)) | 2,016.7 | 1,769.6 | 5,572.7 | 5,125.5 |
Selling, general and administrative expenses | 832 | 802.6 | 2,548.2 | 2,499.5 |
Special (gains) and charges | 6.3 | 35 | 36.7 | 120.3 |
Operating income | 465.8 | 411.4 | 1,210.9 | 979.6 |
Other (income) expense (b) | (13) | (15.1) | (27.5) | (45.6) |
Interest expense, net (c) | 76.4 | 134.8 | 173.7 | 241.8 |
Income before income taxes | 402.4 | 291.7 | 1,064.7 | 783.4 |
Provision for income taxes | 73.8 | 42.4 | 226 | 103.5 |
Net income from continuing operations including noncontrolling interest | 328.6 | 249.3 | 838.7 | 679.9 |
Net income from continuing operations attributable to noncontrolling interest | 4.1 | 3.1 | 9.8 | 12.8 |
Net income from continuing operations attributable to Ecolab | 324.5 | 246.2 | 828.9 | 667.1 |
Net loss from discontinued operations, net of tax (Note 4) (d) | (2,172.5) | |||
Net income (loss) attributable to Ecolab | $ 324.5 | $ 246.2 | $ 828.9 | $ (1,505.4) |
Basic EPS | ||||
Continuing operations | $ 1.13 | $ 0.86 | $ 2.90 | $ 2.32 |
Discontinued operations | (7.56) | |||
Earnings attributable to Ecolab | 1.13 | 0.86 | 2.90 | (5.24) |
Diluted EPS | ||||
Continuing operations | 1.12 | 0.85 | 2.87 | 2.29 |
Discontinued operations | (7.47) | |||
Earnings attributable to Ecolab | $ 1.12 | $ 0.85 | $ 2.87 | $ (5.18) |
Weighted-average common shares outstanding | ||||
Basic (in shares) | 286.4 | 285.4 | 286.1 | 287.5 |
Diluted (in shares) | 289.2 | 288.4 | 289 | 290.8 |
Product and sold equipment | ||||
Net sales | $ 2,653.8 | $ 2,426.4 | $ 7,461.6 | $ 7,017.5 |
Cost of sales (including special charges (a)) | 1,625.1 | 1,405.4 | 4,452.9 | 4,071.6 |
Service and lease equipment | ||||
Net sales | 667 | 592.2 | 1,906.9 | 1,707.4 |
Cost of sales (including special charges (a)) | $ 391.6 | $ 364.2 | $ 1,119.8 | $ 1,053.9 |
CONSOLIDATED STATEMENT OF INC_2
CONSOLIDATED STATEMENT OF INCOME (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Special charges | $ 6.3 | $ 35 | $ 36.7 | $ 120.3 |
Net income from discontinued operations attributable to noncontrolling interest | 2.2 | |||
Cost of sales | ||||
Special charges | 52.9 | 9.5 | 76.2 | 45.6 |
Other (income) expense | ||||
Special charges | 7 | 26.6 | ||
Interest expense | ||||
Special charges | 32.3 | 83.1 | 32.3 | 83.8 |
Product and sold equipment | Cost of sales | ||||
Special charges | $ 52.9 | $ 9.5 | $ 76.2 | $ 45.6 |
CONSOLIDATED STATEMENT OF COMPR
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | ||||
Net income (loss) attributable to Ecolab | $ 324.5 | $ 246.2 | $ 828.9 | $ (1,505.4) |
Net income from continuing operations attributable to noncontrolling interest | 4.1 | 3.1 | 9.8 | 12.8 |
Net income from discontinued operations attributable to noncontrolling interest | 2.2 | |||
Net income (loss) including noncontrolling interest | 328.6 | 249.3 | 838.7 | (1,490.4) |
Foreign currency translation adjustments | ||||
Foreign currency translation | (107.2) | 165.9 | 60.9 | 4.7 |
Separation of ChampionX | 229.9 | |||
Gain (loss) on net investment hedges | 35.2 | (83.4) | 8.8 | (87.4) |
Total foreign currency translation adjustments | (72) | 82.5 | 69.7 | 147.2 |
Derivatives and hedging instruments | 15.3 | (19.1) | 16.7 | (14.1) |
Pension and postretirement benefits | ||||
Current period net actuarial gain | 109.9 | |||
Settlement charge | 5.3 | 20.2 | ||
Amortization of net actuarial loss and prior service credits, net | 28.1 | (18.5) | 42.6 | 12 |
Total pension and postretirement benefits | 33.4 | (18.5) | 172.7 | 12 |
Subtotal | (23.3) | 44.9 | 259.1 | 145.1 |
Total comprehensive income (loss), including noncontrolling interest | 305.3 | 294.2 | 1,097.8 | (1,345.3) |
Comprehensive income attributable to noncontrolling interest | 3.7 | 27.1 | 8 | 15 |
Comprehensive income (loss) attributable to Ecolab | $ 301.6 | $ 267.1 | $ 1,089.8 | $ (1,360.3) |
CONSOLIDATED BALANCE SHEET
CONSOLIDATED BALANCE SHEET - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Current assets | ||
Cash and cash equivalents | $ 897.9 | $ 1,260.2 |
Accounts receivable, net | 2,384.1 | 2,273.8 |
Inventories | 1,378.2 | 1,285.2 |
Other current assets | 326.6 | 298.2 |
Total current assets | 4,986.8 | 5,117.4 |
Property, plant and equipment, net | 3,069.6 | 3,124.9 |
Goodwill | 6,125.6 | 6,006.9 |
Other intangible assets, net | 2,889.7 | 2,977 |
Operating lease assets | 377.4 | 423.8 |
Other assets | 477.1 | 476 |
Total assets | 17,926.2 | 18,126 |
Current liabilities | ||
Short-term debt | 18.7 | 17.3 |
Accounts payable | 1,237.1 | 1,160.6 |
Compensation and benefits | 452.9 | 469.3 |
Income taxes | 68 | 96.1 |
Other current liabilities | 1,117.8 | 1,188.9 |
Total current liabilities | 2,894.5 | 2,932.2 |
Long-term debt | 5,931.8 | 6,669.3 |
Postretirement health care and pension benefits | 996.6 | 1,226.2 |
Deferred income taxes | 589.4 | 483.9 |
Operating lease liabilities | 263 | 300.5 |
Other liabilities | 289.1 | 312.4 |
Total liabilities | 10,964.4 | 11,924.5 |
Commitments and contingencies (Note 17) | ||
Equity (a) | ||
Common stock | 363.7 | 362.6 |
Additional paid-in capital | 6,399.8 | 6,235 |
Retained earnings | 8,659.8 | 8,243 |
Accumulated other comprehensive loss | (1,733.5) | (1,994.4) |
Treasury stock | (6,756.3) | (6,679.7) |
Total Ecolab shareholders' equity | 6,933.5 | 6,166.5 |
Noncontrolling interest | 28.3 | 35 |
Total equity | 6,961.8 | 6,201.5 |
Total liabilities and equity | $ 17,926.2 | $ 18,126 |
CONSOLIDATED BALANCE SHEET (Par
CONSOLIDATED BALANCE SHEET (Parenthetical) - $ / shares shares in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
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 | 286.6 | 285.7 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
OPERATING ACTIVITIES | ||
Net income (loss) including noncontrolling interest | $ 838.7 | $ (1,490.4) |
Less: Net loss from discontinued operations including noncontrolling interest | (2,170.3) | |
Net income from continuing operations including noncontrolling interest | 838.7 | 679.9 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation | 453.1 | 443.1 |
Amortization | 174.4 | 162.1 |
Deferred income taxes | 52.7 | (16.6) |
Share-based compensation expense | 72.5 | 65.1 |
Pension and postretirement plan contributions | (51.3) | (50.1) |
Pension and postretirement plan expense, net | 29.9 | 27.9 |
Restructuring charges, net of cash paid | (35.1) | (9.4) |
Debt refinancing | 29.4 | 77.1 |
Other, net | 19.7 | 44.2 |
Changes in operating assets and liabilities, net of effect of acquisitions: | ||
Accounts receivable | (101) | 98.5 |
Inventories | (79.8) | (176.1) |
Other assets | (48.1) | (22.4) |
Accounts payable | 71.5 | 11.8 |
Other liabilities | (5.6) | (243.1) |
Cash provided by operating activities - continuing operations | 1,421 | 1,092 |
Cash provided by operating activities - discontinued operations | 118.4 | |
Cash provided by operating activities | 1,421 | 1,210.4 |
INVESTING ACTIVITIES | ||
Capital expenditures | (423.8) | (362.3) |
Property and other assets sold | 12.3 | 2.5 |
Acquisitions and investments in affiliates, net of cash acquired | (209.9) | (487) |
Divestiture of businesses | 55.4 | |
Other, net | (17.1) | (4.5) |
Cash used for investing activities - continuing operations | (638.5) | (795.9) |
Cash used for investing activities - discontinued operations | 443.2 | |
Cash used for investing activities | (638.5) | (352.7) |
FINANCING ACTIVITIES | ||
Net issuances of commercial paper and notes payable | 0.5 | 165.5 |
Long-term debt borrowings | 293.7 | 1,855.9 |
Long-term debt repayments | (1,017.9) | (1,570) |
Reacquired shares | (77.8) | (124.6) |
Dividends paid | (426.5) | (421.8) |
Exercise of employee stock options | 94.3 | 199.7 |
Debt refinancing | (29.4) | (77.1) |
Other, net | 3.8 | 2.7 |
Cash (used for) provided by financing activities - continuing operations | (1,159.3) | 30.3 |
Cash provided by financing activities - discontinued operations | (1.6) | |
Cash (used for) provided by financing activities | (1,159.3) | 28.7 |
Effect of exchange rate changes on cash and cash equivalents | 14.5 | (38.1) |
(Decrease) increase in cash and cash equivalents | (362.3) | 848.3 |
Cash and cash equivalents, beginning of period - continuing operations | 1,260.2 | 118.8 |
Cash and cash equivalents, beginning of period - discontinued operations | 67.6 | |
Cash and cash equivalents, beginning of period | 1,260.2 | 186.4 |
Cash and cash equivalents, end of period - continuing operations | 897.9 | 1,034.7 |
Cash and cash equivalents, end of period | $ 897.9 | $ 1,034.7 |
CONSOLIDATED STATEMENT OF EQUIT
CONSOLIDATED STATEMENT OF EQUITY - USD ($) shares in Millions, $ in Millions | Ecolab Shareholders EquityCumulative Effect, Period of Adoption, Adjustment | Ecolab Shareholders Equity | Common Stock | Additional Paid-in Capital | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Retained Earnings | OCI (Loss) | Treasury Stock | Non-Controlling Interest | Cumulative Effect, Period of Adoption, Adjustment | Total |
Balance at Dec. 31, 2019 | $ (4.3) | $ 8,685.3 | $ 359.6 | $ 5,907.1 | $ (4.3) | $ 9,993.7 | $ (2,089.7) | $ (5,485.4) | $ 40.5 | $ (4.3) | $ 8,725.8 |
Increase (Decrease) in Stockholders' Equity | |||||||||||
Net (loss) income | (1,505.3) | (1,505.3) | 14.9 | (1,490.4) | |||||||
Other comprehensive income (loss) activity | 143.8 | 143.8 | 1.3 | 145.1 | |||||||
Cash dividends declared | (404.2) | (404.2) | (16.2) | (420.4) | |||||||
Separation of ChampionX | (1,059.9) | (8.5) | (1,051.4) | 3.4 | (1,056.5) | ||||||
Changes in noncontrolling interest | 17.6 | 17.6 | (9.2) | 8.4 | |||||||
Stock options and awards | 266.3 | 2.5 | 261.1 | 2.7 | 266.3 | ||||||
Reacquired shares | (124.6) | (124.6) | (124.6) | ||||||||
Balance at Sep. 30, 2020 | 6,014.7 | 362.1 | 6,177.3 | 8,079.9 | (1,945.9) | (6,658.7) | 34.7 | 6,049.4 | |||
Balance at Dec. 31, 2019 | $ (4.3) | 8,685.3 | 359.6 | 5,907.1 | $ (4.3) | 9,993.7 | (2,089.7) | (5,485.4) | 40.5 | $ (4.3) | 8,725.8 |
Balance at Dec. 31, 2020 | 6,166.5 | 362.6 | 6,235 | 8,243 | (1,994.4) | (6,679.7) | 35 | $ 6,201.5 | |||
Balance (in shares) at Dec. 31, 2020 | 285.7 | ||||||||||
Balance at Jun. 30, 2020 | 5,855.2 | 362 | 6,155 | 7,967.8 | (1,989.7) | (6,639.9) | 35 | $ 5,890.2 | |||
Increase (Decrease) in Stockholders' Equity | |||||||||||
Net (loss) income | 246.3 | 246.3 | 3 | 249.3 | |||||||
Other comprehensive income (loss) activity | 43.8 | 43.8 | 1.1 | 44.9 | |||||||
Cash dividends declared | (134.2) | (134.2) | (4.4) | (138.6) | |||||||
Stock options and awards | 23.5 | 0.1 | 22.3 | 1.1 | 23.5 | ||||||
Reacquired shares | (19.9) | (19.9) | (19.9) | ||||||||
Balance at Sep. 30, 2020 | 6,014.7 | 362.1 | 6,177.3 | 8,079.9 | (1,945.9) | (6,658.7) | 34.7 | 6,049.4 | |||
Increase (Decrease) in Stockholders' Equity | |||||||||||
Retained earnings | 8,243 | ||||||||||
Balance at Dec. 31, 2020 | 6,166.5 | 362.6 | 6,235 | 8,243 | (1,994.4) | (6,679.7) | 35 | 6,201.5 | |||
Increase (Decrease) in Stockholders' Equity | |||||||||||
Net (loss) income | 828.9 | 828.9 | 9.8 | 838.7 | |||||||
Other comprehensive income (loss) activity | 260.9 | 260.9 | (1.8) | 259.1 | |||||||
Cash dividends declared | (412.1) | (412.1) | (14.7) | (426.8) | |||||||
Stock options and awards | 167.1 | 1.1 | 164.8 | 1.2 | 167.1 | ||||||
Reacquired shares | (77.8) | (77.8) | (77.8) | ||||||||
Balance at Sep. 30, 2021 | 6,933.5 | 363.7 | 6,399.8 | 8,659.8 | (1,733.5) | (6,756.3) | 28.3 | $ 6,961.8 | |||
Balance (in shares) at Sep. 30, 2021 | 286.6 | ||||||||||
Balance at Jun. 30, 2021 | 6,709.1 | 363.2 | 6,333.3 | 8,472.8 | (1,710.6) | (6,749.6) | 27.2 | $ 6,736.3 | |||
Increase (Decrease) in Stockholders' Equity | |||||||||||
Net (loss) income | 324.5 | 324.5 | 4.1 | 328.6 | |||||||
Other comprehensive income (loss) activity | (22.9) | (22.9) | (0.4) | (23.3) | |||||||
Cash dividends declared | (137.5) | (137.5) | (2.6) | (140.1) | |||||||
Stock options and awards | 67.4 | 0.5 | 66.5 | 0.4 | 67.4 | ||||||
Reacquired shares | (7.1) | (7.1) | (7.1) | ||||||||
Balance at Sep. 30, 2021 | $ 6,933.5 | $ 363.7 | $ 6,399.8 | $ 8,659.8 | $ (1,733.5) | $ (6,756.3) | $ 28.3 | $ 6,961.8 | |||
Balance (in shares) at Sep. 30, 2021 | 286.6 | ||||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||
Retained earnings | $ 8,659.8 |
CONSOLIDATED STATEMENT OF EQU_2
CONSOLIDATED STATEMENT OF EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
CONSOLIDATED STATEMENT OF EQUITY | ||||
Dividends declared per common share (in dollars per share) | $ 0.48 | $ 0.47 | $ 1.44 | $ 1.41 |
CONSOLIDATED FINANCIAL INFORMAT
CONSOLIDATED FINANCIAL INFORMATION | 9 Months Ended |
Sep. 30, 2021 | |
CONSOLIDATED FINANCIAL INFORMATION | |
CONSOLIDATED FINANCIAL INFORMATION | 1. CONSOLIDATED FINANCIAL INFORMATION The unaudited consolidated financial information for the third quarter ended September 30, 2021 and 2020 reflects, in the opinion of management, all adjustments necessary for a fair statement of the financial position, results of operations, comprehensive income (loss), equity and cash flows of Ecolab Inc. ("Ecolab" or "the Company") for the interim periods presented. Any adjustments consist of normal recurring items. In March 2020, coronavirus 2019 (“COVID-19”) was declared a pandemic by the World Health Organization. As the impact of the pandemic continues to evolve, estimates and assumptions about future events and their effects cannot be determined with certainty and therefore require judgment. These estimates and assumptions may change in future periods and will be recognized in the consolidated financial information as new events occur and additional information becomes known. To the extent actual results differ materially from those estimates and assumptions, the Company’s future financial statements could be affected. On June 3, 2020, the Company completed the separation of its Upstream Energy business (the “ChampionX business”) in a Reverse Morris Trust transaction (the “Transaction”) through the split-off of ChampionX Holding Inc. (“ChampionX”), formed by Ecolab as a wholly owned subsidiary to hold the ChampionX Business, followed immediately by the merger (the “Merger”) of ChampionX with a wholly owned subsidiary of ChampionX Corporation (f/k/a Apergy Corporation, “Apergy”). As discussed in Note 4 Discontinued Operations, during 2020, the ChampionX business met the criteria to be reported as discontinued operations because the separation of the ChampionX business was a strategic shift in business that had a major effect on the Company's operations and financial results. Therefore, the Company reported the historical results of ChampionX, including the results of operations, cash flows, and related assets and liabilities, as discontinued operations. Unless otherwise noted, the accompanying Notes to the Consolidated Financial Statements have all been revised to reflect the effect of the separation of ChampionX and all prior year balances have been revised accordingly to reflect continuing operations only. Subsequent to the separation of ChampionX, effective the third quarter of 2020, the Company no longer reports the Upstream Energy segment, which previously held the ChampionX business. The Company is aligned into three reportable segments and Other. Except for the changes due to adoption of the new accounting standards, the Company has consistently applied the accounting policies to all periods presented in these consolidated financial statements. 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, 2020 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, 2020 filed with the Securities and Exchange Commission (“SEC”) on February 26, 2021. With respect to the unaudited financial information of the Company for the third quarter ended September 30, 2021 and 2020 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 October 29, 2021 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 | 9 Months Ended |
Sep. 30, 2021 | |
SPECIAL (GAINS) AND CHARGES | |
SPECIAL (GAINS) AND CHARGES | 2. SPECIAL (GAINS) AND CHARGES Special (gains) and charges reported on the Consolidated Statements of Income include the following: Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Cost of sales Restructuring activities $2.2 $1.0 $24.1 $6.6 Acquisition and integration activities - 1.5 - 4.1 COVID-19 activities, net 50.7 1.8 51.8 8.7 Other - 5.2 0.3 26.2 Cost of sales subtotal 52.9 9.5 76.2 45.6 Special (gains) and charges Restructuring activities 0.4 26.9 6.5 31.4 Acquisition and integration activities 0.8 2.7 3.3 5.5 Disposal and impairment activities - - - 45.9 COVID-19 activities, net 1.5 (3.0) 16.2 7.2 Other 3.6 8.4 10.7 30.3 Special (gains) and charges subtotal 6.3 35.0 36.7 120.3 Operating income subtotal 59.2 44.5 112.9 165.9 Interest expense, net 32.3 83.1 32.3 83.8 Other (income) expense 7.0 - 26.6 - Total special (gains) and charges $98.5 $127.6 $171.8 $249.7 For segment reporting purposes, special (gains) and charges are not allocated to reportable segments, which is consistent with the Company’s internal management reporting. Restructuring activities Restructuring activities are primarily related to the Institutional Advancement Program and Accelerate 2020, both of which are described below. Restructuring activities and related costs have been included as a component of both cost of sales and special (gains) and charges on the Consolidated Statements of Income. Restructuring liabilities have been classified as a component of other current and other noncurrent liabilities on the Consolidated Balance Sheets. Institutional Advancement Program The Company approved a restructuring plan in 2020 focused on the Institutional business (“the Institutional Plan”) which is intended to enhance our Institutional sales and service structure and allow the sales team to capture share and penetration while maximizing service effectiveness by leveraging our ongoing investments in digital technology. In February 2021, the Company expanded the Institutional Plan. The Company expects that these restructuring charges will be completed by 2023, with total anticipated costs of $80 million ( $60 million after tax). The costs are expected to be primarily cash expenditures for severance and facility closures. The Company also anticipates non-cash costs related to equipment disposals. Actual costs may vary from these estimates depending on actions taken. During the third quarter and first nine months of 2021, the Company recorded restructuring charges of $1.4 million ( $1.4 million after tax) and $9.5 million ( $7.5 million after tax), respectively, primarily related to costs to support the transition to the new sales and service structure, and the disposal of equipment. The Company has recorded $44.7 million ( $33.9 million after tax) of cumulative restructuring charges under the Institutional Plan. The liability related to the Institutional Plan was $8.0 million as of September 30, 2021 and is expected to be paid over a period of a few months to several quarters and will continue to be funded from operating activities. Restructuring activity related to the Institutional Plan since inception of the underlying actions includes the following: Employee Termination Asset (millions) Costs Disposals Other Total 2020 Activity Recorded expense and accrual $25.6 $- $9.6 $35.2 Net cash payments (0.9) - (9.6) (10.5) Restructuring liability, December 31, 2020 24.7 - - 24.7 2021 Activity Recorded expense (income) and accrual 2.2 6.0 1.3 9.5 Net cash payments (18.9) - (2.7) (21.6) Non-cash net charges - (6.0) 1.4 (4.6) Restructuring liability, September 30, 2021 $8.0 $- $- $8.0 Accelerate 2020 During 2018, the Company formally commenced a restructuring plan Accelerate 2020 (“the Plan”), to leverage technology and system investments and organizational changes. The goals of the Plan are to simplify and automate processes and tasks, reduce complexity and management layers, consolidate facilities and focus on key long-term growth areas by further leveraging technology and structural improvements. During 2020, the Company expanded the Plan for additional costs and savings to further leverage the technology and structural improvements. The Company now expects that the restructuring activities will be completed by the end of 2022, with total anticipated costs of $255 million ( $195 million after tax) when revised for continuing operations. The remaining costs are expected to be primarily cash expenditures for severance costs and some facility closure costs relating to team reorganizations. Actual costs may vary from these estimates depending on actions taken. The Company recorded restructuring charges of $1.5 million ( $1.2 million after tax) and $2.9 million ( $2.8 million after tax) in the third quarter and first nine months of 2021, respectively, primarily related to severance. The liability related to the Plan was $40.6 million as of the end of the third quarter of 2021. The Company has recorded $242.1 million ( $186.6 million after tax) of cumulative restructuring charges under the Plan. The remaining liability is expected to be paid over a period of several quarters and will continue to be funded from operating activities. Restructuring activity related to the Accelerate 2020 Plan since inception of the underlying actions includes the following: Employee Termination Asset (millions) Costs Disposals Other Total 2018-2020 Activity Recorded expense $212.0 $8.0 $19.2 $239.2 Net cash payments (144.3) 1.2 (12.2) (155.3) Non-cash charges - (9.2) (2.0) (11.2) Effect of foreign currency translation (0.9) - - (0.9) Restructuring liability, December 31, 2020 66.8 - 5.0 71.8 2021 Activity Recorded expense 2.4 0.3 0.2 2.9 Net cash payments (31.6) - (2.1) (33.7) Non-cash charges - (0.3) (0.1) (0.4) Restructuring liability, September 30, 2021 $37.6 $- $3.0 $40.6 Other Restructuring Activities During the third quarter and nine months of 2021, the Company recorded restructuring charges (gains) of ( $0.3 ) million ( $0.5 million after tax) and $18.2 million ( $16.9 million after tax), respectively, related to other immaterial restructuring activity. The charges are primarily related to severance and asset write-offs. During the third quarters and first nine months of 2021 and 2020, net restructuring charges related to prior year plans were minimal. The restructuring liability balance for all plans other than the Accelerate 2020 and Institutional Plan were $4.6 million and $5.9 million as of September 30, 2021 and December 31, 2020, respectively. The remaining liability is expected to be paid over a period of a few months to several quarters and will continue to be funded from operating activities. Cash payments during 2021 related to all other restructuring plans excluding the Accelerate 2020 and Institutional Plan were $10.5 million. Acquisition and integration related costs Acquisition and integration costs reported in special (gains) and charges on the Consolidated Statements of Income include $0.8 million ( $0.8 million after tax) and $3.3 million ( $2.9 million after tax) in the third quarter and first nine months of 2021, respectively. Charges are related to Copal Invest NV, including its primary operating entity CID Lines (collectively, “CID Lines”), and Bioquell PLC (“Bioquell”) acquisitions and consist of integration costs, advisory and legal fees. Acquisition and integration costs reported in special (gains) and charges on the Consolidated Statements of Income include $2.7 million ( $2.3 million after tax) and $5.5 million ( $4.3 million after tax) in the third quarter and first nine months of 2020, respectively. Charges are related to CID Lines, Bioquell and the Laboratoires Anios (“Anios”) acquisitions and consist of integration costs, advisory and legal fees. Acquisition and integration costs reported in product and equipment cost of sales of $1.5 million ( $1.3 million after tax) and $4.1 million ( $3.2 million after tax) on the Consolidated Statements of Income in the third quarter and first nine months of 2020, respectively, related to the recognition of fair value step-up in the CID Lines inventory, severance and the closure of a facility. The Company also incurred $0.7 million ( $0.6 million after tax) of interest expense in the first nine months of 2020, none of which was incurred during the third quarter. Further information related to the Company’s acquisitions is included in Note 3. Disposal and impairment charges Disposal and impairment charges reported in special (gains) and charges on the Consolidated Statements of Income include $45.9 million ( $45.0 million after tax) in the first nine months of 2020. During the second quarter of 2020, the Company recorded a $28.6 million ( $28.6 million after tax) impairment for a minority equity method investment due to the impact of the economic environment and the liquidity of the minority equity method investment. In addition, the Company recorded charges of $17.3 million ( $16.3 million after tax) in the first six months of 2020 related to transaction fees associated with the sale of Holchem Group Limited (“Holchem”). Further information related to the Company’s disposal is included in Note 3. COVID-19 activities Customer demand for sanitizer products surged at the outset of COVID-19. The Company worked hard to meet the rapidly increasing demand and sold the vast majority of the sanitizer inventory. However, COVID-19 variant-related delays of customer reopenings and consumer activity resulted in a small portion of excess sanitizer inventory. The Company recorded inventory reserves of $50 million in the third quarter of 2021 for excess sanitizer inventory and estimated disposal costs. The Company recorded charges of $2.6 million and $4.1 million during the third quarter of 2021 and 2020, respectively, and $12.6 million and $30.6 million during the first nine months of 2021 and 2020, respectively, to protect the wages for certain employees directly impacted by the COVID-19 pandemic. The Company also recorded charges during the third quarter and first nine months of 2021 of $3.1 million and $11.5 million, respectively, related to COVID-19 testing and related expenses. In addition, the Company received subsidies and government assistance, which were recorded as a special (gain) of ( $3.5 ) million and ( $5.3 ) million during the third quarter of 2021 and 2020, respectively, and ( $6.1 ) million and ( $14.7 ) million during the first nine months of 2021 and 2020, respectively. COVID-19 pandemic charges are recorded in product and equipment cost of sales, service and lease cost of sales, and special (gains) and charges on the Consolidated Statements of Income. After tax net charges (gains) related to the COVID-19 pandemic were $40.6 million and ($0.9) million during the third quarter of 2021 and 2020, respectively, and $51.9 million and $12.3 million during the first nine months of 2021 and 2020, respectively. Other operating activities Other special charges recorded in the first nine months of 2021 in product and equipment cost of sales were $0.3 million ( $0.2 million after tax). During the third quarter and first nine months of 2020, the Company recorded special charges of $5.2 million ( $3.5 million after tax) and $26.2 million ( 17.8 million after tax), respectively, in product and equipment cost of sales on the Consolidated Statements of Income related to a Healthcare product recall in Europe. Other special charges of $3.6 million ( $2.7 million after tax) and $10.7 million ( $8.3 million after tax) recorded in the third quarter and first nine months of 2021, respectively, relate primarily to legal reserve and certain legal charges which are recorded in special (gains) and charges on the Consolidated Statements of Income. Other special charges of $8.4 million ( $7.2 million after tax) and $30.3 million ( $23.7 million after tax), respectively, recorded in the third quarter and first nine months of 2020 relate primarily to legal reserve and certain legal charges which are recorded in special (gains) and charges on the Consolidated Statements of Income. Interest expense Other special charges of $32.3 million ( $28.4 million after tax) and $83.1 million ( $64.0 million after tax) in the third quarter of 2021 and 2020, respectively, in interest expense on the Consolidated Statement of Income primarily related to debt refinancing charges. Other (income) expense During the third quarter and first nine months of 2021, the Company incurred settlement expense recorded in other (income) expense on the Consolidated Statements of Income of $7.0 million ( $5.3 million after tax) and $26.6 million ( $20.2 million after tax), respectively, related to U.S. pension plan lump-sum payments to retirees. |
ACQUISITIONS AND DISPOSITIONS
ACQUISITIONS AND DISPOSITIONS | 9 Months Ended |
Sep. 30, 2021 | |
ACQUISITIONS AND DISPOSITIONS | |
ACQUISITIONS AND DISPOSITIONS | 3. ACQUISITIONS AND DISPOSITIONS Acquisitions The Company makes business acquisitions that align with its strategic business objectives. The assets and liabilities of acquired businesses are recorded in the Consolidated Balance Sheets at fair value as of their acquisition dates. The purchase price allocation is based on estimates of the fair value of assets acquired, liabilities assumed and consideration transferred. Purchase consideration transferred is reduced by the amount of cash or cash equivalents acquired. Acquisitions during the first nine months of 2021 and 2020 were not significant to the Company’s consolidated financial statements; therefore, pro forma financial information is not presented. During the third quarter of 2021, the Company acquired National Wiper Alliance, Inc. (“NWA”), a U.S.-based business which sells dry wipes for healthcare and institutional applications. NWA became part of the Global Healthcare & Life Sciences reporting segment. During the first quarter of 2021, the Company acquired VanBaerle Hygiene AG (“VanBaerle”), a Swiss-based business which sells cleaning products and related services to restaurants, long-term care facilities, hotels and laundries primarily for institutional applications. VanBaerle became part of the Global Institutional reporting segment. The purchase price included immaterial amounts of holdback and contingent consideration, which are recorded within other liabilities on the Consolidated Balance Sheets as of September 30, 2021. Also, during the first quarter of 2021, the Company acquired TechTex Holdings Limited (“TechTex”), a U.K.-based business which sells wet and dry wipes and other nonwovens products primarily for life sciences and healthcare applications. TechTex became part of the Global Healthcare & Life Sciences reporting segment. The purchase price included an immaterial holdback amount that was subsequently settled prior to September 30, 2021. The purchase accounting for these acquisitions are preliminary and subject to change as the Company finalizes the valuation of intangible assets, income tax balances and working capital. The Company does not expect any of the goodwill related to its acquisitions of VanBaerle or TechTex to be tax deductible, whereas the goodwill arising from the application of NWA is expected to be tax deductible. Other than CID Lines, the Company did not close on any other business acquisitions during the first nine months of 2020. The following table summarizes the acquisition date fair value of net assets acquired from the Company’s acquisitions other than CID Lines during the first nine months of 2021 and 2020. Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Net tangible assets (liabilities) acquired and equity method investments $14.8 $- $12.4 $- Identifiable intangible assets Customer relationships 41.0 - 72.1 - Trademarks 1.1 - 4.7 - Non-compete agreements 3.0 3.0 Other technology - - 1.5 - Total intangible assets 45.1 - 81.3 - Goodwill 60.2 - 119.2 - Total aggregate purchase price 120.1 - 212.9 - Acquisition-related liabilities and contingent consideration (a) - - (4.4) - Net cash paid for acquisitions, including acquisition-related liabilities and contingent consideration $120.1 $- $208.5 $- (a) Subsequent to the acquisitions, $1.4 in contingent consideration was remitted to the seller during the first nine months of 2021 and is included in investing activities on the Consolidated Statements of Cash Flows. During the first nine months of 2020, the Company recorded purchase accounting adjustments associated with the finalization of the purchase accounting on its 2019 acquisitions. As a result of these purchase accounting adjustments, the net intangible assets and goodwill recognized from these acquisitions increased by $1.3 million and $0.3 million, respectively. In conjunction with the finalization of its purchase accounting, the Company made $3.5 million of acquisition-related payments which primarily consisted of the release of holdback liabilities and payment of contingent consideration. The weighted average useful life of identifiable intangible assets acquired during the first nine months of 2021 was 14 years . CID Lines Acquisition On May 11, 2020, the Company acquired CID Lines for total consideration of $506.9 million in cash. CID Lines had annualized pre-acquisition sales of approximately $110 million and is a leading global provider of livestock biosecurity and hygiene solutions based in Belgium. The Company incurred certain acquisition and integration costs associated with the transaction that were expensed and are reflected on the Consolidated Statements of Income. Further information related to the Company’s special (gains) and charges is included in Note 2. The following table summarizes the acquisition date fair value of net assets acquired from the Company’s acquisition of CID Lines. (millions) May 11, 2020 Tangible assets $54.1 Identifiable intangible assets Customer relationships 147.5 Trademarks 58.6 Acquired technologies and product registrations 47.7 Total assets acquired 307.9 Goodwill 274.8 Total liabilities 97.2 Net consideration transferred to sellers $485.5 Tangible assets are primarily comprised of accounts receivable of $30.1 million, property, plant and equipment of $7.7 million and inventory of $16.3 million. Liabilities primarily consist of deferred tax liabilities of $64.8 million and current liabilities of $32.4 million. Customer relationships, trademarks, and other technology and product registrations are being amortized over weighted average lives of 14 , 14 , and 16 years , respectively. Goodwill of $274.8 million arising from the acquisition consists largely of the synergies and economies of scale expected through adding complementary geographies and innovative products to the Company’s Food and Beverage businesses. CID Lines became part of the Global Industrial reportable segment. None of the goodwill recognized is expected to be deductible for income tax purposes. During the first six months of 2021, the Company recorded purchase accounting adjustments that decreased goodwill recognized from the acquisition of CID Lines by $0.9 million. Purchase accounting was finalized in the second quarter of 2021 and no further purchase accounting adjustments will be recorded for the CID Lines acquisition. Dispositions There were no business dispositions during the first nine months of 2021. In the second quarter of 2020, the Company completed the sale of Holchem, a U.K.-based supplier of hygiene and cleaning products and services for the food and beverage, foodservice and hospitality industries for total consideration of $106.6 million. Consideration consisted of $55.4 million of cash and $51.2 million in notes receivable recorded at fair value. After the recognition of transaction costs, the Company recognized an after-tax loss of $16.3 million, which is classified within special (gains) and charges on the Consolidated Statements of Income. Annual sales of Holchem were approximately $55 million and were included in the Global Industrial reportable segment prior to disposition. Further information related to the Company’s special (gains) and charges is included in Note 2. As discussed in Note 4, the ChampionX separation met the criteria to be reported as discontinued operations. No other dispositions were significant to the Company’s consolidated financial statements for the first nine months of 2020. Subsequent Event On October 28, 2021, Ecolab entered into an agreement to acquire Purolite Corporation for $3.7 billion, subject to certain adjustments. Purolite is a leading, fast growing global provider of high-end ion exchange resins for separation and purification solutions that are highly complementary to our current offering and critical to high quality, safe drug production and biopharma products purification in the life sciences industries. It also provides ultra-pure water solutions for critical industrial markets like microelectronics, nuclear power and food and beverage. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 9 Months Ended |
Sep. 30, 2021 | |
DISCONTINUED OPERATIONS. | |
DISCONTINUED OPERATIONS | 4. DISCONTINUED OPERATIONS On June 3, 2020, the Company effected the split-off of ChampionX through an offer to exchange (the “Exchange Offer”) all shares of ChampionX common stock owned by Ecolab for outstanding shares of Ecolab common stock. In the Exchange Offer, which was oversubscribed, the Company accepted approximately 5.0 million shares of Ecolab common stock in exchange for approximately 122.2 million shares of ChampionX common stock. In the Merger, each outstanding share of ChampionX common stock was converted into the right to receive one share of Apergy common stock, and ChampionX survived the Merger as a wholly owned subsidiary of ChampionX Corporation (f/k/a Apergy). In connection with and in accordance with the terms of the Transaction, prior to the consummation of the Exchange Offer and the Merger, ChampionX distributed $527.4 million in cash to Ecolab. The following is a summary of the assets and liabilities transferred to ChampionX as part of the separation: (millions) Assets: Cash and cash equivalent $60.6 Current assets 810.5 Non-current assets 3,222.3 4,093.4 Liabilities: Current liabilities 313.0 Non-current liabilities 293.7 606.7 Net assets distributed to ChampionX ($3,486.7) Fair value of shares exchanged 1,051.4 Cash received from ChampionX 527.4 Consideration received less net assets (1,907.9) ChampionX cumulative translation adjustment ("CTA") write-off (229.9) Loss on separation ($2,137.8) The Company accounted for this transaction as a sale and recognized a loss based on ChampionX net assets exceeding the effective proceeds. The ChampionX business, as discussed in Note 1, met the criteria to be reported as discontinued operations because the separation of the ChampionX business was a strategic shift in business that had a major effect on the Company’s operations and financial results. Therefore, the results of discontinued operations for the second quarter ended June 30, 2020 include the historical results of ChampionX prior to separation. Summarized results of the Company’s discontinued operations are as follows: Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Product and equipment sales $- $- $- $858.9 Service and lease sales - - - 99.6 Net sales - - - 958.5 Product and equipment cost of sales - - - 621.7 Service and lease cost of sales - - - 80.4 Cost of sales (including special charges) - - - 702.1 Selling, general and administrative expenses - - - 180.5 Special (gains) and charges - - - 2,221.7 Operating income - - - (2,145.8) Other (income) expense - - - 0.3 Interest expense (income), net - - - 0.2 Income before income taxes - - - (2,146.3) Provision for income taxes - - - 24.0 Net loss including noncontrolling interest - - - (2,170.3) Net income attributable to noncontrolling interest - - - 2.2 Net loss from discontinued operations, net of tax $- $- $- ($2,172.5) Special (gains) and charges of $2,221.7 million in the first nine months of 2020 primarily relate to professional fees incurred to support the Transaction and restructuring charges specifically related to the ChampionX business. These charges have been included as a component of both cost of sales and special (gains) and charges in discontinued operations. The Company also recognized discrete tax expense primarily related to friction costs associated with ChampionX separation activity of $22.7 million in the first nine months of 2020 that is allocated within discontinued operations tax expense. In connection with the Transaction, the Company entered into agreements with ChampionX and Apergy to effect the separation and to provide a framework for the relationship following the separation, which included a Separation and Distribution Agreement, an Intellectual Property Matters Agreement, an Employee Matters Agreement, a Transition Services Agreement, and a Tax Matters Agreement. Transition services primarily involve the Company providing certain services to ChampionX related to general and administrative services for terms of up to 18 months following the separation. The amounts billed for transition services provided under the above agreements were not material to the Company’s results of operations. The Company also entered into a Master Cross Supply and Product Transfer agreement with ChampionX to provide, receive or transfer certain products for a period up to 36 months . Sales of product to ChampionX under this agreement are recorded in product and equipment sales in the Corporate segment along with the related cost of sales, while purchases from ChampionX are recorded in inventory. Sales of product to ChampionX post-separation for the third quarter and first nine months of 2021 were $35.8 million and $103.5 million, respectively, and for the third quarter and first nine months of 2020 were $46.6 million and $58.9 million, respectively. As of September 30, 2021, the Company had an outstanding accounts receivable balance for sales of product to ChampionX of $18.0 million. |
BALANCE SHEETS INFORMATION
BALANCE SHEETS INFORMATION | 9 Months Ended |
Sep. 30, 2021 | |
BALANCE SHEETS INFORMATION | |
BALANCE SHEETS INFORMATION | 5. BALANCE SHEETS INFORMATION September 30 December 31 (millions) 2021 2020 Accounts receivable, net Accounts receivable $2,460.5 $2,358.1 Allowance for doubtful accounts (76.4) (84.3) Total $2,384.1 $2,273.8 Inventories Finished goods $886.5 $789.6 Raw materials and parts 550.2 511.2 Inventories at FIFO cost 1,436.7 1,300.8 FIFO cost to LIFO cost difference (58.5) (15.6) Total $1,378.2 $1,285.2 Other current assets Prepaid assets $122.8 $99.1 Taxes receivable 158.0 168.6 Derivative assets 25.6 3.2 Other 20.2 27.3 Total $326.6 $298.2 Property, plant and equipment, net Land $153.2 $159.7 Buildings and leasehold improvements 1,083.7 1,060.0 Machinery and equipment 1,828.6 1,830.1 Merchandising and customer equipment 2,714.6 2,691.0 Capitalized software 863.7 820.8 Construction in progress 279.7 219.8 6,923.5 6,781.4 Accumulated depreciation (3,853.9) (3,656.5) Total $3,069.6 $3,124.9 Other intangible assets, net Intangible assets not subject to amortization Trade names $1,230.0 $1,230.0 Intangible assets subject to amortization Customer relationships 2,593.2 2,530.9 Trademarks 348.0 348.0 Patents 499.5 492.5 Other technology 242.4 240.1 3,683.1 3,611.5 Accumulated amortization Customer relationships (1,432.6) (1,319.1) Trademarks (169.7) (155.0) Patents (266.9) (244.6) Other technology (154.2) (145.8) (2,023.4) (1,864.5) Net intangible assets subject to amortization 1,659.7 1,747.0 Total $2,889.7 $2,977.0 Other assets Deferred income taxes $150.8 $163.2 Pension 46.9 33.0 Derivative asset 3.2 - Other 276.2 279.8 Total $477.1 $476.0 September 30 December 31 (millions) 2021 2020 Other current liabilities Discounts and rebates $341.0 $304.1 Dividends payable 137.5 137.2 Interest payable 44.0 51.7 Taxes payable, other than income 131.7 151.8 Derivative liabilities 1.0 25.8 Restructuring 48.9 98.1 Contract liability 86.7 80.4 Operating lease liabilities 115.7 125.6 Other 211.3 214.2 Total $1,117.8 $1,188.9 Accumulated other comprehensive loss Unrealized loss on derivative financial instruments, net of tax ($4.4) ($21.1) Unrecognized pension and postretirement benefit expense, net of tax (762.5) (935.2) Cumulative translation, net of tax (966.6) (1,038.1) Total ($1,733.5) ($1,994.4) |
DEBT AND INTEREST
DEBT AND INTEREST | 9 Months Ended |
Sep. 30, 2021 | |
DEBT AND INTEREST | |
DEBT AND INTEREST | 6. DEBT AND INTEREST Short-term Debt The following table provides the components of the Company’s short-term debt obligations as of September 30, 2021 and December 31, 2020. September 30 December 31 (millions) 2021 2020 Short-term debt Notes payable $16.0 $15.5 Long-term debt, current maturities 2.7 1.8 Total $18.7 $17.3 Lines of Credit As of September 30, 2021, the Company has a $2.0 billion multi-year credit facility which expires in April 2026. The credit facility has been established with a diverse syndicate of banks and supports the Company’s U.S. and Euro commercial paper programs. There were no borrowings under the Company’s credit facility as of either September 30, 2021 or December 31, 2020. Commercial Paper The Company’s commercial paper program is used as a source of liquidity and consists of a $2.0 billion U.S. commercial paper program and a $2.0 billion Euro commercial paper program. The maximum aggregate amount of commercial paper that may be issued by the Company under its commercial paper programs may not exceed $2.0 billion. The Company had no outstanding commercial paper under its U.S. or Euro programs as of either September 30, 2021 or December 31, 2020. Notes Payable The Company’s notes payable consists of uncommitted credit lines with major international banks and financial institutions, primarily to support global cash pooling structures. As of September 30, 2021 and December 31, 2020, the Company had $16.0 million and $15.5 million, respectively, outstanding under these credit lines. Long-term Debt The following table provides the components of the Company’s long-term debt obligations, including current maturities, as of September 30, 2021 and December 31, 2020. Maturity September 30 December 31 (millions) by Year 2021 2020 Long-term debt Public and 144A notes (2021 principal amount) Five year 2017 senior notes ( $500 million) 2022 $- $498.6 Seven year 2016 senior notes ( $400 million) 2023 - 399.0 Seven year 2016 senior notes ( €575 million) 2024 676.1 682.0 Ten year 2015 senior notes ( €575 million) 2025 676.6 682.9 Ten year 2016 senior notes ( $750 million) 2026 745.9 745.3 Ten year 2017 senior notes ( $500 million) 2027 493.6 496.0 Ten year 2020 senior notes ( $698 million) 2030 708.3 765.2 Ten year 2020 senior notes ( $600 million) 2031 594.9 594.4 Thirty year 2011 senior notes ( $389 million) 2041 384.2 452.2 Thirty year 2016 senior notes ( $200 million) 2046 197.1 246.4 Thirty year 2017 senior notes ( $484 million) 2047 424.0 611.9 Thirty year 2020 senior notes ( $500 million) 2050 490.3 490.1 Thirty-four year 2021 144A notes ( $685 million) 2055 534.9 - Finance lease obligations and other 8.6 7.1 Total debt 5,934.5 6,671.1 Long-term debt, current maturities (2.7) (1.8) Total long-term debt $5,931.8 $6,669.3 Public and 144A Notes In August 2021, the Company completed a private offering of a $300 million aggregate principal 34-year fixed rate note with a coupon rate of 2.75% (“New 34-year Notes”). Immediately following the offering, the Company completed a private offering to exchange a portion of the outstanding senior notes due 2030, 2041, 2046, 2047 (“Old Notes”), for $385 million of New 34-year Notes (collectively “144A Notes”). In connection with the exchange offering, $387 million of Old Notes were validly tendered and subsequently cancelled. The New 34-year Notes bear a lower fixed coupon rate on an extended maturity date, compared with the Old Notes that were exchanged. There were no other significant changes to the terms between the Old Notes and the New 34-year Notes. The exchange was accounted for as a debt modification, and there were cash payments to the note holders of $118 million as a result of the exchange. Existing deferred financing costs associated with the Old Notes, as well as discounts associated with the New 34-year Notes aggregating $143 million, are being amortized over the term of the New 34-year Notes and recorded as interest expense. In September 2021, the Company completed the retirement of the $500 million 2.375% Notes due 2022 and the $400 million 3.25% Notes due 2023 which was accounted for as a debt extinguishment. A make-whole premium of $25.0 million was expensed immediately and is reflected as a financing cash flow activity. The Company’s public notes and 144A 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 would be required to offer to repurchase the public notes and 144A 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 and 144A notes are senior unsecured and unsubordinated obligations of the Company and rank equally with all other senior and unsubordinated indebtedness of the Company. The Company entered into a registration rights agreement in connection with the issuance of the 144A Notes. Subject to certain limitations set forth in the registration rights agreement, the Company has agreed to (i) file a registration statement (the “Exchange Offer Registration Statement”) with respect to registered offers to exchange the 144A Notes for exchange notes (the “Exchange Notes”), which will have terms identical in all material respects to the New 34-year Notes, as applicable, except that the Exchange Notes will not contain transfer restrictions and will not provide for any increase in the interest rate thereon in certain circumstances and (ii) use commercially reasonable efforts to cause the Exchange Offer Registration Statement to be declared effective within 270 days after the date of issuance of the 144A Notes. Until such time as the Exchange Offer Registration Statement is declared effective, the 144A Notes may only be transferred in accordance with Rule 144A or Regulation S of the Securities Act of 1933, as amended. Covenants The Company is in compliance with its debt covenants as of September 30, 2021. Net Interest Expense Interest expense and interest income recognized during the third quarter and first nine months of 2021 and 2020 were as follows: Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Interest expense $78.3 $139.0 $183.8 $253.4 Interest income (1.9) (4.2) (10.1) (11.6) Interest expense, net $76.4 $134.8 $173.7 $241.8 Interest expense generally includes the expense associated with the interest on the Company’s outstanding borrowings. Interest expense also includes the amortization of debt issuance costs and debt discounts, which are both recognized over the term of the related debt. During the third quarter of 2021, the Company issued, exchanged and retired certain long-term debt, incurring debt refinancing charges of $32.3 million ( $28.4 million after tax), which are included as a component of interest expense, net on the Consolidated Statement of Income. During the third quarter of 2020, the Company retired certain long-term debt, and incurred debt refinancing charges of $83.1 million ( $64.0 million after tax), which are included as a component of interest expense, net on the Consolidated Statement of Income. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2021 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | 7. GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill Goodwill arises from the Company’s acquisitions and represents the excess purchase consideration transferred over the fair value of acquired net assets. The Company’s reporting units are its operating segments. The Company assesses goodwill for impairment on an annual basis during the second quarter. If circumstances change or events occur that demonstrate it is more likely than not that the carrying amount of a reporting unit exceeds its fair value, the Company completes an interim goodwill assessment of that reporting unit prior to the next annual assessment. If the results of an annual or interim goodwill assessment demonstrate the carrying amount of a reporting unit is greater than its fair value, the Company will recognize an impairment loss for the amount by which the reporting unit’s carrying amount exceeds its fair value, but not to exceed the carrying amount of goodwill assigned to that reporting unit. During the second quarter of 2021, the Company completed its annual goodwill impairment assessment for each of its eleven reporting units using discounted cash flow analyses that incorporated assumptions, including future operating performance, long-term growth, and discount rates. The Company’s goodwill impairment assessments for 2021 indicated the estimated fair values of each of its reporting units exceeded the carrying amounts of the respective reporting units by significant margins. There has been no impairment of goodwill in any of the periods presented. The changes in the carrying amount of goodwill for each of the Company's reportable segments during the nine-month period ended September 30, 2021 were as follows: Global Global Global Institutional Healthcare & (millions) Industrial & Specialty Life Sciences Other Total December 31, 2020 $4,287.9 $564.1 $909.8 $245.1 $6,006.9 Current year business combinations (a) - 11.0 108.2 - 119.2 Prior year business combinations (b) (0.9) - - - (0.9) Effect of foreign currency translation 2.4 (0.4) (1.5) (0.1) 0.4 September 30, 2021 $4,289.4 $574.7 $1,016.5 $245.0 $6,125.6 (a) Represents goodwill associated with current year acquisitions. (b) Represents purchase accounting adjustments associated with the CID Lines acquisition. Other Intangible Assets The Nalco trade name is the Company’s only indefinite life intangible asset, which is tested for impairment on an annual basis during the second quarter. During the second quarter of 2021, the Company completed its annual impairment assessment of the Nalco trade name using the relief from royalty discounted cash flow method, which incorporates assumptions, including future sales projections, royalty rates and discount rates. The Company’s Nalco tradename impairment assessment for 2021 indicated the estimated fair value of the Nalco trade name exceeded its $1.2 billion carrying amount by a significant margin. There has been no impairment of the Nalco trade name intangible since it was acquired. The Company’s intangible assets subject to amortization include customer relationships, trademarks, patents and other technology primarily acquired through business acquisitions. The fair value of intangible assets acquired in business acquisitions are estimated primarily using discounted cash flow valuation methods at the time of acquisition. Intangible assets are amortized on a straight-line basis over their estimated lives. Total amortization expense related to intangible assets during the third quarter of 2021 and 2020 was $57.7 million and $58.9 million, respectively. Total amortization expense related to intangible assets during the first nine months of 2021 and 2020 was $174.4 and $162.1 million, respectively. Amortization expense related to intangible assets for the remaining three-month period of 2021 is expected to be approximately $53 million. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2021 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 8. FAIR VALUE MEASUREMENTS The Company’s financial instruments include cash and cash equivalents, restricted cash, accounts receivable, accounts payable, contingent consideration obligations, commercial paper, notes payable, foreign currency forward contracts, interest rate swap agreements, cross-currency swap derivative 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: September 30, 2021 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $45.0 $- $45.0 $- Interest rate swap agreements 2.4 - 2.4 - Liabilities Foreign currency forward contracts 31.6 - 31.6 - Interest rate swap agreements 3.9 3.9 Cross-currency swap derivative contract 2.0 - 2.0 - December 31, 2020 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $15.5 $- $15.5 $- Liabilities Foreign currency forward contracts 69.9 - 69.9 - 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 agreements are at fair value, which are determined based on current forward interest rates as of the balance sheet date and are classified within Level 2. The cross-currency swap derivative contract is used to partially hedge the Company’s net investments in foreign operations against adverse movements in exchange rates between the U.S. dollar and the Euro. The carrying value of the cross-currency swap derivative contract is at fair value, which is determined based on the income approach with the relevant interest rates and foreign currency current exchange rates and forward curves as inputs as of the balance sheet date and is classified within Level 2. For purposes of fair value disclosure above, derivative values are presented gross. Further discussion of gross versus net presentation of the Company's derivatives within Note 9. Contingent consideration obligations are recognized and measured at fair value at the acquisition date and thereafter until settlement or expiration. Contingent consideration is classified within Level 3 as the underlying fair value is determined using income-based valuation approaches appropriate for the terms and conditions of each respective contingent consideration. 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. Contingent consideration was not material to the Company’s consolidated financial statements. The carrying values of accounts receivable, accounts payable, cash and cash equivalents, restricted cash, 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 (classified as Level 2). The carrying amount and the estimated fair value of long-term debt, including current maturities, held by the Company were: September 30, 2021 December 31, 2020 Carrying Fair Carrying Fair Amount Value Amount Value Long-term debt, including current maturities $5,934.5 $6,623.3 $6,671.1 $7,704.4 |
DERIVATIVES AND HEDGING TRANSAC
DERIVATIVES AND HEDGING TRANSACTIONS | 9 Months Ended |
Sep. 30, 2021 | |
DERIVATIVES AND HEDGING TRANSACTIONS | |
DERIVATIVES AND HEDGING TRANSACTIONS | 9. DERIVATIVES AND HEDGING TRANSACTIONS The Company uses foreign currency forward contracts, cross-currency swap derivative contracts, interest rate swap contracts 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 in the Consolidated Balance Sheets 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. 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 global 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 in the following table, no cash collateral had been received or pledged related to the underlying derivatives. The respective net amounts are included in other current assets, other assets, other current liabilities and other liabilities on the Consolidated Balance Sheets. The following table summarizes the gross fair value and the net value of the Company’s outstanding derivatives. Derivative Assets Derivative Liabilities September 30 December 31 September 30 December 31 (millions) 2021 2020 2021 2020 Derivatives designated as hedging instruments Foreign currency forward contracts $17.1 $8.1 $24.1 $54.3 Interest rate swap agreements 2.4 - 3.9 - Cross-currency swap derivative contract - - 2.0 - Derivatives not designated as hedging instruments Foreign currency forward contracts 27.9 7.4 7.5 15.6 Gross value of derivatives 47.4 15.5 37.5 69.9 Gross amounts offset in the Consolidated Balance Sheets (18.6) (12.3) (18.6) (12.3) Net value of derivatives $28.8 $3.2 $18.9 $57.6 The following table summarizes the notional values of the Company’s outstanding derivatives. Notional Values September 30 December 31 (millions) 2021 2020 Foreign currency forward contracts $ 3,819 $ 3,702 Interest rate swap agreements 750 - Cross-currency swap derivative contract 354 - 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 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 on the Consolidated Statements of Income as the underlying exposure being hedged. Cash flow hedged transactions impacting AOCI are forecasted to occur within the next three years . For forward contracts designated as hedges of foreign currency exchange rate risk associated with forecasted foreign currency transactions, the Company excludes the changes in fair value attributable to time value from the assessment of hedge effectiveness. The initial value of the excluded component (i.e., the forward points) is amortized on a straight-line basis over the life of the hedging instrument and recognized in the same line item on the Consolidated Statements of Income as the underlying exposure being hedged for intercompany loans. For all other cash flow hedge types, the forward points are marked-to-market monthly and recognized in the same line item on the Consolidated Statements of Income as the underlying exposure being hedged. The difference between fair value changes of the excluded component and the amount amortized on the Consolidated Statements of Income is recorded in AOCI. 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 offset against the underlying debt instrument. These fair value hedges are highly effective. In March 2021, the Company entered into an interest rate swap agreement that converted $250 million of its 3.25% debt from a fixed interest rate to a floating interest rate. The interest rate swap is designated as a fair value hedge. In July 2021, the Company entered into an interest rate swap agreement that converted the remaining $250 million of its 3.25% debt from a fixed interest rate to a floating interest rate. The interest rate swap is designated as a fair value hedge. In September 2021, the Company entered into an interest rate swap agreement that converted $250 million of its 4.80% debt from a fixed interest rate to a floating interest rate. The interest rate swap is designated as a fair value hedge The following amounts were recorded in the Consolidated Balance Sheets related to cumulative basis adjustments for fair value hedges: Carrying amount of the hedged liabilities Cumulative amount of the fair value hedging adjustment included in the carrying amount of the hedged liabilities Third Quarter Ended Third Quarter Ended Line item in which the hedged item is included September 30 September 30 (millions) 2021 2020 2021 2020 Long-term debt $745.9 $- $5.2 $- Net Investment Hedges The Company designates its outstanding €1,150 million ( $1,353 million at the end of the third quarter of 2021) senior notes (“Euronotes”) and related accrued interest as hedges of its Euro denominated exposures from the Company’s investments in certain of its Euro denominated functional currency subsidiaries. In July 2021, the Company entered into a cross-currency swap derivative contract with a notional amount of €300 million maturing in 2030. The cross-currency swap derivative contract is designated as a net investment hedge of its Euro denominated exposures from the Company’s investments in certain of its Euro denominated functional currency subsidiaries. The cross-currency swap derivative contract exchanges fixed-rate payments in one currency for fixed-rate payments in another currency. As of September 30, 2021, the Company had a €300 million ( $354 million) cross-currency swap derivative contract outstanding as a hedge of the Company’s net investment in foreign operations. The changes in the spot rate of these instruments are recorded in accumulated other comprehensive income (loss) in stockholders’ equity, partially offsetting the foreign currency translation adjustment of the Company’s related net investment that is also recorded in accumulated other comprehensive income (loss). Any ineffective portions of net investment hedges are reclassified from accumulated other comprehensive income (loss) into earnings during the period of change. The interest income or expense from these swaps are recorded in interest expense on the accompanying Consolidated Statements of Income consistent with the classification of interest expense attributable to the underlying debt. The revaluation gains and losses on the Euronotes and cross-currency swap derivative contract, 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, and were as follows: Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Revaluation gain (loss), net of tax: Euronotes $36.7 ($83.4) $10.3 ($87.4) Cross-currency swap derivative contract (1.5) - (1.5) - Total revaluation gain (loss), net of tax $35.2 ($83.4) $8.8 ($87.4) 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. Effect of all Derivative Instruments on Income The gain (loss) of all derivative instruments recognized in product and equipment cost of sales (“COS”), selling, general and administrative expenses (“SG&A”) and interest expense, net (“interest”) is summarized below: Third Quarter Ended September 30 2021 2020 (millions) COS SG&A Interest COS SG&A Interest Gain (loss) on derivatives in cash flow hedging relationship: Foreign currency forward contracts Amount of gain (loss) reclassified from AOCI to income ($4.6) $42.1 $- $3.1 ($101.5) $- Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value - - 5.1 - - (4.9) Interest rate swap agreements Amount of gain (loss) reclassified from AOCI to income - - (0.6) - - (0.2) Gain (loss) on derivatives not designated as hedging instruments: Foreign currency forward contracts Amount of gain (loss) recognized in income (a) - 22.8 - - (30.2) 11.3 Total gain (loss) of all derivative instruments ($4.6) $64.9 $4.5 $3.1 ($131.7) $6.2 Nine Months Ended September 30 2021 2020 (millions) COS SG&A Interest COS SG&A Interest Gain (loss) on derivatives in cash flow hedging relationship: Foreign currency forward contracts Amount of gain (loss) reclassified from AOCI to income ($9.2) $4.7 $- $9.1 ($108.8) $- Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value - - 16.4 - - 8.6 Interest rate swap agreements Amount of gain (loss) reclassified from AOCI to income - - (1.8) - - (0.7) Gain (loss) on derivatives not designated as hedging instruments: Foreign currency forward contracts Amount of gain (loss) recognized in income (a) - 28.6 - - (12.3) 11.3 Total gain (loss) of all derivative instruments ($9.2) $33.3 $14.6 $9.1 ($121.1) $19.2 (a) Gain (loss) on derivatives not designated as hedging instruments recognized in income recorded in SG&A includes discontinued operations of ( $2.5 ) in the first nine months of 2020. Subsequent Event In October 2021, the Company entered into an interest rate swap agreement that converted $250 million of its 2.70% debt from a fixed interest rate to a floating interest rate. The interest rate swap is designated as a fair value hedge. |
OTHER COMPREHENSIVE INCOME (LOS
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | 9 Months Ended |
Sep. 30, 2021 | |
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | |
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | 10. OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION Other comprehensive income (loss) includes net income, foreign currency translation adjustments, 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. Refer to Note 9 for additional information related to the Company’s derivatives and hedging transactions. Refer to Note 14 for additional information related to the Company’s pension and postretirement benefits activity. Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Derivative and Hedging Instruments Unrealized gain (loss) on derivative & hedging instruments Amount recognized in AOCI $61.2 ($126.2) $30.3 ($108.3) Loss (gain) reclassified from AOCI into income COS 4.6 (3.1) 9.2 (9.1) SG&A (42.1) 101.5 (4.7) 108.8 Interest (income) expense, net (4.5) 5.1 (14.6) (7.9) (42.0) 103.5 (10.1) 91.8 Other activity 0.5 (0.2) (0.2) (0.2) Tax impact (4.4) 3.8 (3.3) 2.6 Net of tax $15.3 ($19.1) $16.7 ($14.1) Pension and Postretirement Benefits Amount recognized in AOCI Current period net actuarial gain $- $- $145.0 $- Amount reclassified from AOCI into income Settlement charge 7.0 - 26.6 - Amortization of net actuarial loss and prior period service credits, net 16.3 15.0 59.8 44.3 23.3 15.0 231.4 44.3 Other activity 15.6 (29.8) (2.8) (21.5) Tax impact (5.5) (3.7) (55.9) (10.8) Net of tax $33.4 ($18.5) $172.7 $12.0 The following table summarizes the derivative and pension and postretirement benefit amounts reclassified from AOCI into income. Third Quarter Ended Nine Months Ended September 30 September 30 2021 2020 2021 2020 (millions) Derivative (gain) loss reclassified from AOCI into income, net of tax ($31.9) $78.2 ($7.7) $69.4 Pension and postretirement benefits amortization of net actuarial losses and prior service credits and settlement charges reclassified from AOCI into income, net of tax 33.4 (18.5) 62.8 12.0 |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2021 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | 11. SHAREHOLDERS’ EQUITY Share Repurchase Authorization In February 2015, the Company’s Board of Directors authorized the repurchase of up to 20,000,000 shares of its common stock, including shares to be repurchased under Rule 10b5–1. As of September 30, 2021, 5,978,499 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. Share Repurchases During the nine months of 2021, the Company reacquired 367,141 shares of its common stock, of which 261,447 related to share repurchases through open market and 105,694 related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units. During all of 2020, the Company reacquired 761,245 shares of its common stock, of which 565,064 related to share repurchases through open market or private purchases and 196,181 related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units. Separation of ChampionX On June 3, 2020, the Company effected the split-off of ChampionX through the Exchange Offer and all shares of ChampionX common stock owned by Ecolab were exchanged for outstanding shares of Ecolab common stock. In the Exchange Offer, which was oversubscribed, the Company accepted 4,955,552 shares of Ecolab common stock in exchange for approximately 122,200,000 shares of ChampionX common stock. |
EARNINGS ATTRIBUTABLE TO ECOLAB
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") | 9 Months Ended |
Sep. 30, 2021 | |
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") | |
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") | 12. EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE (“EPS”) The difference in the weighted average common shares outstanding for calculating basic and diluted EPS is a result of the dilution associated with the Company’s equity compensation plans. As noted in the table below, certain stock options and units outstanding under these equity compensation plans were not included in the computation of diluted EPS because they would not have had a dilutive effect. The computations of the basic and diluted EPS amounts were as follows: Third Quarter Ended Nine Months Ended September 30 September 30 (millions, except per share) 2021 2020 2021 2020 Net income from continuing operations attributable to Ecolab $324.5 $246.2 $828.9 $667.1 Net loss from discontinued operations - - - (2,172.5) Net income (loss) attributable to Ecolab $324.5 $246.2 $828.9 ($1,505.4) Weighted-average common shares outstanding Basic 286.4 285.4 286.1 287.5 Effect of dilutive stock options and units 2.8 3.0 2.9 3.3 Diluted 289.2 288.4 289.0 290.8 Earnings (loss) attributable to Ecolab per common share Basic EPS Continuing operations $ 1.13 $ 0.86 $ 2.90 $ 2.32 Discontinued operations $ - $ - $ - ($ 7.56) Earnings (loss) attributable to Ecolab $ 1.13 $ 0.86 $ 2.90 ($ 5.24) Diluted EPS Continuing operations $ 1.12 $ 0.85 $ 2.87 $ 2.29 Discontinued operations $ - $ - $ - ($ 7.47) Earnings (loss) attributable to Ecolab $ 1.12 $ 0.85 $ 2.87 ($ 5.18) Anti-dilutive securities excluded from the computation of diluted EPS 1.0 1.0 1.0 1.0 Amounts do not necessarily sum due to rounding. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2021 | |
INCOME TAXES | |
INCOME TAXES | 13. INCOME TAXES The Company’s tax rate was 18.3% and 14.5% for the third quarter of 2021 and 2020, respectively, and 21.2% and 13.2% for the first nine months of 2021 and 2020, respectively. The change in the Company’s tax rate for the third quarter and first nine months of 2021 compared to the third quarter and first nine months of 2020 was driven primarily by the impact of discrete tax items and special (gains) and charges. Further information related to special (gains) and charges is included in Note 2. The Company recognized net tax benefits related to discrete tax items of $6.3 million in the third quarter and $17.5 million in the first nine months of 2021. This included a tax benefit of $4.0 million in the third quarter and a net tax expense of $5.5 million in the first nine months of 2021 related to prior year returns, and a deferred tax benefit of $0.4 million and deferred tax expense of $23.8 million associated with transferring certain intangible property between affiliates in the third quarter and first nine months of 2021, respectively. Share-based compensation excess tax benefit was $9.9 million and $20.7 million in the third quarter and first nine months of 2021, respectively. The amount of this tax benefit is subject to variation in stock price and award exercises. The remaining discrete tax expense of $8.0 million and $8.9 million during the third quarter and first nine months of 2021, respectively, was primarily due to changes in tax law, reserves for uncertain tax positions, audit settlements, and other changes in estimates. The Company recognized net tax benefits related to discrete tax items of $12.4 million and $56.8 million in the third quarter and first nine months of 2020, respectively. Share-based compensation excess tax benefit contributed $3.4 million and $49.0 million in the third quarter and first nine months of 2020, respectively. Additionally, the Company recognized a net tax benefit of $6.9 million and $2.4 million primarily related to the release of a valuation allowance, the filing of prior year foreign tax returns and other income tax adjustments in the third quarter and first nine months of 2020, respectively. The remaining discrete net tax benefit of $2.1 million and $5.4 million was due to the net release of reserves for uncertain tax positions during the third quarter and first nine months of 2020, respectively. |
PENSION AND POSTRETIREMENT PLAN
PENSION AND POSTRETIREMENT PLANS | 9 Months Ended |
Sep. 30, 2021 | |
PENSION AND POSTRETIREMENT PLANS | |
RETIREMENT PLANS | 14. 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 benefits 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. Effective January 1, 2021, the Company modified its U.S. qualified defined benefit pension plan to harmonize benefits across all plan participants, resulting in a reduction of service cost in 2021. The components of net periodic pension and postretirement health care benefit expense for the third quarter ended September 30 are as follows: U.S. International U.S. Postretirement Pension Pension Health Care (millions) 2021 2020 2021 2020 2021 2020 Service cost $11.2 $16.5 $7.9 $7.9 $0.2 $0.3 Interest cost on benefit obligation 13.3 17.7 4.4 5.5 0.7 0.8 Expected return on plan assets (38.0) (38.2) (16.6) (15.7) (0.1) (0.1) Recognition of net actuarial loss (gain) 12.1 13.0 5.8 6.6 0.2 (0.1) Amortization of prior service benefit (1.7) (1.6) (0.1) (0.1) - (2.9) Curtailments and settlements (b) 7.0 - - - - - Total expense (benefit) $3.9 $7.4 $1.4 $4.2 $1.0 ($2.0) The components of net periodic pension and postretirement health care benefit expense for the nine months ended September 30 are as follows: U.S. International U.S. Postretirement Pension Pension Health Care (millions) 2021 2020 2021 2020 2021 2020 Service cost (a) $32.8 $51.9 $24.0 $23.2 $0.6 $0.9 Interest cost on benefit obligation 38.3 52.7 13.1 16.1 2.1 2.9 Expected return on plan assets (115.2) (114.6) (51.9) (46.7) (0.3) (0.3) Recognition of net actuarial (gain) loss 44.5 39.0 20.3 19.2 0.6 - Amortization of prior service benefit (5.1) (5.4) (0.5) (0.1) - (8.4) Curtailments and settlements (b) 26.6 - - - - - Total expense (benefit) $21.9 $23.6 $5.0 $11.7 $3.0 ($4.9) (a) Service cost includes discontinued operations of $2.5 in the first six months of 2020. (b) Settlement expense was recognized as special charges in the third quarter and first nine months of 2021. Service cost is included as employee compensation cost within either cost of sales or selling, general and administrative expenses on the Consolidated Statements of Income based on employee roles, while all other components of net periodic pension and postretirement health care benefit expense are included in other (income) expense on the Consolidated Statements of Income. As of September 30, 2021, the Company is in compliance with all funding requirements of each of its defined benefit plans. During the first nine months of 2021, the Company made contributions of $10 million to its U.S. non-contributory non-qualified defined benefit plans and estimates it will contribute an additional $5 million to such plans during the remainder of 2021. During the first nine months of 2021, the Company made contributions of $33 million to its international pension plans and estimates it will contribute an additional $10 million to such plans during the remainder of 2021. During the first nine months of 2021, the Company made contributions of $8 million to its U.S. postretirement health care plans and estimates it will contribute an additional $3 million to such plans during the remainder of 2021. |
REVENUES
REVENUES | 9 Months Ended |
Sep. 30, 2021 | |
REVENUES | |
REVENUES | 15. REVENUES Revenue Recognition Product and Sold Equipment Product revenue is generated from sales of cleaning, sanitizing, water and colloidal silica products. In addition, the Company sells equipment which may be used in combination with its specialized products. Revenue recognized from product and equipment sales is recognized at the point in time when the obligations in the contract with the customer are satisfied, which generally occurs with the transfer of the product or delivery of the equipment. Service and Lease Equipment Service and lease equipment revenue is generated from providing services or leasing equipment to customers. Service offerings include installing or repairing certain types of equipment, activities that supplement or replace headcount at the customer location, or fulfilling deliverables included in the contract. Global Industrial segment services are associated with water treatment and paper process applications. Global Institutional & Specialty segment services include cleaning and sanitizing programs and wash process solutions. Global Healthcare & Life Sciences segment services include pharmaceutical, personal care, infection and containment control solutions. Revenues included in Other primarily relate to services designed to detect, eliminate and prevent pests. Service revenue is recognized over time utilizing an input method and aligns with when the services are provided. Typically, revenue is recognized over time using costs incurred to date because the effort provided by the field selling and service organization represents services provided, which corresponds with the transfer of control. Revenue recognized from leased equipment primarily relates to warewashing and water treatment equipment recognized on a straight-line basis over the length of the lease contract pursuant to Topic 842 Leases. In the second quarter ended June 30, 2020, the Company provided a one-time lease billing suspension of approximately $38 million to certain restaurant customers within the Institutional Segment, in recognition of the impact of the COVID-19 pandemic. There was no substantial change to the consideration expected to be received under the lease arrangement. The Company’s operating lease revenue was as follows: Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Operating lease revenue* $103.3 $84.9 $306.4 $258.2 *Includes immaterial variable lease revenue The following table shows principal activities, separated by reportable segments, from which the Company generates its revenue. The reportable segments have been revised to align with the Company’s reportable segments in the current year. Corporate segment includes sales to ChampionX under the Master Cross Supply and Product Transfer agreements entered into as part of the ChampionX Separation. For more information about the Company’s reportable segments, refer to Note 16. Net sales at public exchange rates by reportable segment are as follows: Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Global Industrial Product and sold equipment $1,386.0 $1,264.3 $3,941.0 $3,725.8 Service and lease equipment 217.1 205.0 637.6 600.9 Global Institutional & Specialty Product and sold equipment 889.9 758.7 2,397.7 2,248.7 Service and lease equipment 180.7 139.7 506.3 429.9 Global Healthcare & Life Sciences Product and sold equipment 259.4 292.3 795.4 788.1 Service and lease equipment 27.5 30.0 86.0 78.3 Other Product and sold equipment 82.7 64.5 224.0 196.0 Service and lease equipment 241.5 217.2 676.4 598.0 Corporate Product and sold equipment 35.8 46.6 103.5 58.9 Service and lease equipment 0.2 0.3 0.6 0.3 Total Total product and sold equipment $2,653.8 $2,426.4 $7,461.6 $7,017.5 Total service and lease equipment $667.0 $592.2 $1,906.9 $1,707.4 Net sales at public exchange rates by geographic region for the third quarter ended September 30 are as follows: Global Global Institutional Global Healthcare Industrial & Specialty & Life Sciences Other Corporate 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 North America $716.8 $683.5 $776.4 $654.1 $112.6 $113.2 $201.3 $175.7 $25.7 $34.8 Europe 353.3 325.0 166.3 127.1 154.1 170.7 70.6 59.3 0.8 2.4 Asia Pacific 199.8 180.4 48.4 47.6 14.8 27.8 17.1 14.3 1.5 1.4 Latin America 141.0 117.5 34.9 32.4 - 3.5 13.0 13.4 6.7 6.6 Greater China 102.9 85.1 32.6 26.7 1.8 1.7 19.5 16.7 0.7 0.4 India, Middle East and Africa 89.3 77.8 12.0 10.5 3.6 5.4 2.7 2.3 0.6 1.3 Total $1,603.1 $1,469.3 $1,070.6 $898.4 $286.9 $322.3 $324.2 $281.7 $36.0 $46.9 Net sales at public exchange rates by geographic region for the nine months ended September 30 are as follows: Global Global Institutional Global Healthcare Industrial & Specialty & Life Sciences Other Corporate (millions) 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 North America $2,046.0 $2,033.1 $2,133.6 $1,926.4 $320.0 $325.6 $549.8 $496.6 $73.4 $47.1 Europe 1,008.5 914.8 394.5 375.7 500.8 462.2 191.3 164.2 2.6 2.4 Asia Pacific 586.8 548.8 150.0 156.1 40.3 51.7 54.9 45.0 4.2 1.4 Latin America 400.5 362.5 97.3 103.0 1.1 6.3 37.7 35.7 19.4 6.6 Greater China 292.7 237.5 98.7 82.8 4.5 5.0 57.7 45.0 1.9 0.4 India, Middle East and Africa 244.1 230.0 29.9 34.6 14.7 15.6 9.0 7.5 2.6 1.3 Total $4,578.6 $4,326.7 $2,904.0 $2,678.6 $881.4 $866.4 $900.4 $794.0 $104.1 $59.2 Net sales by geographic region were determined based on origin of sale. Revenues in the United States made up 52% and 52% of total during the nine months ended September 30, 2021 and 2020, respectively. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are carried at the invoiced amounts, less an allowance for doubtful accounts, and generally do not bear interest. The Company estimates the allowance for doubtful accounts for expected credit losses by analyzing accounts receivable balances by age and applying historical write-off and collection trend rates. The Company’s estimates separately consider specific circumstances and credit conditions of customer receivables, and whether it is probable balances will be collected. Account balances are written off against the allowance when it is determined the receivable will not be recovered. The Company’s allowance for doubtful accounts balance also includes an allowance for the expected return of products shipped and credits related to pricing or quantities shipped of $20.4 million and $15.3 million as of September 30, 2021 and 2020, respectively. Returns and credit activity is recorded directly as a reduction to revenue. The following table summarizes the activity in the allowance for doubtful accounts: Nine Months Ended September 30 (millions) 2021 2020 Beginning balance $84.3 $55.5 Adoption of new standard - 4.3 Bad debt expense 12.4 54.6 Write-offs (23.7) (25.0) Other (a) 3.4 (1.2) Ending balance (b) $76.4 $88.2 (a) Other amounts are primarily the effects of changes in currency translations and the impact of allowance for returns and credits. (b) The allowance for doubtful accounts balances in 2021 and 2020 reflect increased reserves, primarily due to the Institutional customer base as a result of the COVID-19 pandemic. Contract Liability Payments received from customers are based on invoices or billing schedules as established in contracts with customers. Accounts receivable are recorded when the right to consideration becomes unconditional. The contract liability relates to billings in advance of performance (primarily service obligations) under the contract. Contract liabilities are recognized as revenue when the performance obligation has been performed, which primarily occurs during the subsequent quarter. September 30 September 30 (millions) 2021 2020 Contract liability as of beginning of the year $80.4 $76.7 Revenue recognized in the period from: Amounts included in the contract liability at the beginning of the year (80.4) (76.7) Increases due to billings excluding amounts recognized as revenue during the period ended 86.7 84.0 Business combinations - 0.6 Contract liability as of end of period $86.7 $84.6 |
OPERATING SEGMENTS
OPERATING SEGMENTS | 9 Months Ended |
Sep. 30, 2021 | |
OPERATING SEGMENTS | |
OPERATING SEGMENTS | 16. OPERATING SEGMENTS The Company’s organizational structure consists of global business unit and global regional leadership teams. The Company’s 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 segment level. The Company’s operating segments that share similar economic characteristics and future prospects, nature of the products and production processes, end-use markets, channels of distribution and regulatory environment have been aggregated into three reportable segments: Global Industrial, Global Institutional & Specialty and Global Healthcare & Life Sciences. The Company’s operating segments that do not meet the quantitative criteria to be separately reported have been combined into Other. The Company provides similar information for Other as the Company considers the information regarding its underlying operating segments 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 eliminates 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. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. 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 2021 and have been updated from the 2020 rates reflected in the Company’s Form 10-K. The difference between the fixed currency exchange rates and the actual currency exchange rates is reported within the “Effect of foreign currency translation” row in the table below. The “Other” column shown in the table reflects immaterial changes between segments, primarily cost allocations. The impact of the preceding changes on previously reported full year 2020 reportable segment net sales and operating income is summarized as follows: December 31, 2020 2020 Reported Fixed 2020 Reported Valued at 2020 Currency Valued at 2021 (millions) Management Rates Other Rate Change Management Rates Net Sales Global Industrial $5,959.9 ($3.7) $92.0 $6,048.2 Global Institutional & Specialty 3,577.2 9.3 42.5 3,629.0 Global Healthcare & Life Sciences 1,189.1 3.7 48.3 1,241.1 Other 1,093.3 (9.3) 19.4 1,103.4 Corporate 102.4 - (1.8) 100.6 Subtotal at fixed currency rates 11,921.9 - 200.4 12,122.3 Effect of foreign currency translation (131.7) - (200.4) (332.1) Consolidated reported GAAP net sales $11,790.2 $- $- $11,790.2 Operating Income Global Industrial $1,106.0 ($0.2) $17.3 $1,123.1 Global Institutional & Specialty 321.9 (0.3) 2.4 324.0 Global Healthcare & Life Sciences 207.6 0.7 10.0 218.3 Other 131.5 (0.2) 1.5 132.8 Corporate (347.5) - (2.2) (349.7) Subtotal at fixed currency rates 1,419.5 - 29.0 1,448.5 Effect of foreign currency translation (23.8) - (29.0) (52.8) Consolidated reported GAAP operating income $1,395.7 $- $- $1,395.7 Reportable Segment Information Financial information for the Company’s reportable segments, is as follows: Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Net Sales Global Industrial $1,620.4 $1,512.9 $4,609.7 $4,476.4 Global Institutional & Specialty 1,076.6 914.4 2,914.0 2,734.6 Global Healthcare & Life Sciences 290.2 335.1 887.4 913.3 Other 326.3 288.7 904.2 817.4 Corporate 35.9 47.2 104.1 59.5 Subtotal at fixed currency rates 3,349.4 3,098.3 9,419.4 9,001.2 Effect of foreign currency translation (28.6) (79.7) (50.9) (276.3) Consolidated reported GAAP net sales $3,320.8 $3,018.6 $9,368.5 $8,724.9 Operating Income Global Industrial $268.3 $302.3 $750.8 $799.7 Global Institutional & Specialty 196.5 83.7 398.2 229.4 Global Healthcare & Life Sciences 37.3 69.0 131.2 162.0 Other 59.2 45.8 143.4 88.4 Corporate (90.0) (74.2) (204.4) (257.4) Subtotal at fixed currency rates 471.3 426.6 1,219.2 1,022.1 Effect of foreign currency translation (5.5) (15.2) (8.3) (42.5) Consolidated reported GAAP operating income $465.8 $411.4 $1,210.9 $979.6 The profitability of the Company’s operating segments is evaluated by management based on operating income. Consistent with the Company’s internal management reporting, Corporate amounts in the table above include sales to ChampionX in accordance with the long-term supply agreement entered into with the Transaction, as discussed in Note 4. Corporate also includes intangible asset amortization specifically from the Nalco merger and special (gains) and charges, as discussed in Note 2, that are not allocated to the Company’s reportable segments. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 17. 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 is also subject to various claims and contingencies related to income taxes. The Company also has contractual obligations including lease commitments. The Company records liabilities when a contingent loss is probable and can be reasonably estimated. If the reasonable estimate of a probable loss is a range, the Company records the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount. The Company discloses a contingent liability even if the liability is not probable or the amount is not estimable, or both, if there is a reasonable possibility that a material loss may have been incurred. Insurance Globally, the Company has insurance policies with varying deductible levels 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, employment, commercial, patent infringement, tort, 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 30 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. |
NEW ACCOUNTING PRONOUNCEMENTS
NEW ACCOUNTING PRONOUNCEMENTS | 9 Months Ended |
Sep. 30, 2021 | |
NEW ACCOUNTING PRONOUNCEMENTS | |
NEW ACCOUNTING PRONOUNCEMENTS | 18. NEW ACCOUNTING PRONOUNCEMENTS Standards that are not yet adopted: Required Date of Date of Effect on the Standard Issuance Description Adoption Financial Statements ASU 2020-04 - Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting March 2020 LIBOR, a widely used reference rate for pricing financial products is scheduled to be discontinued on December 31, 2021. This standard provides optional expedients and exceptions if certain criteria are met when accounting for contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. Application of guidance is optional until the options and expedients expire on December 31, 2022. The Company has not elected any expedients and adoption of this standard is not expected to have a material impact on the Company's financial statements. Standards that were adopted: Date of Date of Effect on the Standard Issuance Description Adoption Financial Statements ASU 2019-12 - Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes December 2019 Simplifies the accounting for income taxes by removing certain exceptions to the general principles related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and recognition of deferred tax liabilities for outside basis differences. The new standard also simplifies the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the basis of goodwill. January 1, 2021 Adoption of this standard did not have a material impact on the Company's financial statements. No other new accounting pronouncements issued or effective have had or are expected to have a material impact on the Company’s consolidated financial statements. |
SPECIAL (GAINS) AND CHARGES (Ta
SPECIAL (GAINS) AND CHARGES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Restructuring Activities | |
Special (gains) and charges | Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Cost of sales Restructuring activities $2.2 $1.0 $24.1 $6.6 Acquisition and integration activities - 1.5 - 4.1 COVID-19 activities, net 50.7 1.8 51.8 8.7 Other - 5.2 0.3 26.2 Cost of sales subtotal 52.9 9.5 76.2 45.6 Special (gains) and charges Restructuring activities 0.4 26.9 6.5 31.4 Acquisition and integration activities 0.8 2.7 3.3 5.5 Disposal and impairment activities - - - 45.9 COVID-19 activities, net 1.5 (3.0) 16.2 7.2 Other 3.6 8.4 10.7 30.3 Special (gains) and charges subtotal 6.3 35.0 36.7 120.3 Operating income subtotal 59.2 44.5 112.9 165.9 Interest expense, net 32.3 83.1 32.3 83.8 Other (income) expense 7.0 - 26.6 - Total special (gains) and charges $98.5 $127.6 $171.8 $249.7 |
Institutional Advancement Program | |
Restructuring Activities | |
Restructuring activity | Employee Termination Asset (millions) Costs Disposals Other Total 2020 Activity Recorded expense and accrual $25.6 $- $9.6 $35.2 Net cash payments (0.9) - (9.6) (10.5) Restructuring liability, December 31, 2020 24.7 - - 24.7 2021 Activity Recorded expense (income) and accrual 2.2 6.0 1.3 9.5 Net cash payments (18.9) - (2.7) (21.6) Non-cash net charges - (6.0) 1.4 (4.6) Restructuring liability, September 30, 2021 $8.0 $- $- $8.0 |
Accelerate 2020 Restructuring Plan | |
Restructuring Activities | |
Restructuring activity | Employee Termination Asset (millions) Costs Disposals Other Total 2018-2020 Activity Recorded expense $212.0 $8.0 $19.2 $239.2 Net cash payments (144.3) 1.2 (12.2) (155.3) Non-cash charges - (9.2) (2.0) (11.2) Effect of foreign currency translation (0.9) - - (0.9) Restructuring liability, December 31, 2020 66.8 - 5.0 71.8 2021 Activity Recorded expense 2.4 0.3 0.2 2.9 Net cash payments (31.6) - (2.1) (33.7) Non-cash charges - (0.3) (0.1) (0.4) Restructuring liability, September 30, 2021 $37.6 $- $3.0 $40.6 |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
CID Lines | |
Business acquisitions | |
Schedule of assets acquired and liabilities assumed | (millions) May 11, 2020 Tangible assets $54.1 Identifiable intangible assets Customer relationships 147.5 Trademarks 58.6 Acquired technologies and product registrations 47.7 Total assets acquired 307.9 Goodwill 274.8 Total liabilities 97.2 Net consideration transferred to sellers $485.5 |
Acquisitions | |
Business acquisitions | |
Schedule of assets acquired and liabilities assumed | Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Net tangible assets (liabilities) acquired and equity method investments $14.8 $- $12.4 $- Identifiable intangible assets Customer relationships 41.0 - 72.1 - Trademarks 1.1 - 4.7 - Non-compete agreements 3.0 3.0 Other technology - - 1.5 - Total intangible assets 45.1 - 81.3 - Goodwill 60.2 - 119.2 - Total aggregate purchase price 120.1 - 212.9 - Acquisition-related liabilities and contingent consideration (a) - - (4.4) - Net cash paid for acquisitions, including acquisition-related liabilities and contingent consideration $120.1 $- $208.5 $- (a) Subsequent to the acquisitions, $1.4 in contingent consideration was remitted to the seller during the first nine months of 2021 and is included in investing activities on the Consolidated Statements of Cash Flows. |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
DISCONTINUED OPERATIONS. | |
Schedule Of Assets And Liabilities Transferred As A Part Of Separation | (millions) Assets: Cash and cash equivalent $60.6 Current assets 810.5 Non-current assets 3,222.3 4,093.4 Liabilities: Current liabilities 313.0 Non-current liabilities 293.7 606.7 Net assets distributed to ChampionX ($3,486.7) Fair value of shares exchanged 1,051.4 Cash received from ChampionX 527.4 Consideration received less net assets (1,907.9) ChampionX cumulative translation adjustment ("CTA") write-off (229.9) Loss on separation ($2,137.8) |
Summary of discontinued operations | Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Product and equipment sales $- $- $- $858.9 Service and lease sales - - - 99.6 Net sales - - - 958.5 Product and equipment cost of sales - - - 621.7 Service and lease cost of sales - - - 80.4 Cost of sales (including special charges) - - - 702.1 Selling, general and administrative expenses - - - 180.5 Special (gains) and charges - - - 2,221.7 Operating income - - - (2,145.8) Other (income) expense - - - 0.3 Interest expense (income), net - - - 0.2 Income before income taxes - - - (2,146.3) Provision for income taxes - - - 24.0 Net loss including noncontrolling interest - - - (2,170.3) Net income attributable to noncontrolling interest - - - 2.2 Net loss from discontinued operations, net of tax $- $- $- ($2,172.5) |
BALANCE SHEETS INFORMATION (Tab
BALANCE SHEETS INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
BALANCE SHEETS INFORMATION | |
Balance Sheet Information | September 30 December 31 (millions) 2021 2020 Accounts receivable, net Accounts receivable $2,460.5 $2,358.1 Allowance for doubtful accounts (76.4) (84.3) Total $2,384.1 $2,273.8 Inventories Finished goods $886.5 $789.6 Raw materials and parts 550.2 511.2 Inventories at FIFO cost 1,436.7 1,300.8 FIFO cost to LIFO cost difference (58.5) (15.6) Total $1,378.2 $1,285.2 Other current assets Prepaid assets $122.8 $99.1 Taxes receivable 158.0 168.6 Derivative assets 25.6 3.2 Other 20.2 27.3 Total $326.6 $298.2 Property, plant and equipment, net Land $153.2 $159.7 Buildings and leasehold improvements 1,083.7 1,060.0 Machinery and equipment 1,828.6 1,830.1 Merchandising and customer equipment 2,714.6 2,691.0 Capitalized software 863.7 820.8 Construction in progress 279.7 219.8 6,923.5 6,781.4 Accumulated depreciation (3,853.9) (3,656.5) Total $3,069.6 $3,124.9 Other intangible assets, net Intangible assets not subject to amortization Trade names $1,230.0 $1,230.0 Intangible assets subject to amortization Customer relationships 2,593.2 2,530.9 Trademarks 348.0 348.0 Patents 499.5 492.5 Other technology 242.4 240.1 3,683.1 3,611.5 Accumulated amortization Customer relationships (1,432.6) (1,319.1) Trademarks (169.7) (155.0) Patents (266.9) (244.6) Other technology (154.2) (145.8) (2,023.4) (1,864.5) Net intangible assets subject to amortization 1,659.7 1,747.0 Total $2,889.7 $2,977.0 Other assets Deferred income taxes $150.8 $163.2 Pension 46.9 33.0 Derivative asset 3.2 - Other 276.2 279.8 Total $477.1 $476.0 September 30 December 31 (millions) 2021 2020 Other current liabilities Discounts and rebates $341.0 $304.1 Dividends payable 137.5 137.2 Interest payable 44.0 51.7 Taxes payable, other than income 131.7 151.8 Derivative liabilities 1.0 25.8 Restructuring 48.9 98.1 Contract liability 86.7 80.4 Operating lease liabilities 115.7 125.6 Other 211.3 214.2 Total $1,117.8 $1,188.9 Accumulated other comprehensive loss Unrealized loss on derivative financial instruments, net of tax ($4.4) ($21.1) Unrecognized pension and postretirement benefit expense, net of tax (762.5) (935.2) Cumulative translation, net of tax (966.6) (1,038.1) Total ($1,733.5) ($1,994.4) |
DEBT AND INTEREST (Tables)
DEBT AND INTEREST (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
DEBT AND INTEREST | |
Schedule of short-term debt obligations | September 30 December 31 (millions) 2021 2020 Short-term debt Notes payable $16.0 $15.5 Long-term debt, current maturities 2.7 1.8 Total $18.7 $17.3 |
Schedule of long-term debt obligations including current maturities | Maturity September 30 December 31 (millions) by Year 2021 2020 Long-term debt Public and 144A notes (2021 principal amount) Five year 2017 senior notes ( $500 million) 2022 $- $498.6 Seven year 2016 senior notes ( $400 million) 2023 - 399.0 Seven year 2016 senior notes ( €575 million) 2024 676.1 682.0 Ten year 2015 senior notes ( €575 million) 2025 676.6 682.9 Ten year 2016 senior notes ( $750 million) 2026 745.9 745.3 Ten year 2017 senior notes ( $500 million) 2027 493.6 496.0 Ten year 2020 senior notes ( $698 million) 2030 708.3 765.2 Ten year 2020 senior notes ( $600 million) 2031 594.9 594.4 Thirty year 2011 senior notes ( $389 million) 2041 384.2 452.2 Thirty year 2016 senior notes ( $200 million) 2046 197.1 246.4 Thirty year 2017 senior notes ( $484 million) 2047 424.0 611.9 Thirty year 2020 senior notes ( $500 million) 2050 490.3 490.1 Thirty-four year 2021 144A notes ( $685 million) 2055 534.9 - Finance lease obligations and other 8.6 7.1 Total debt 5,934.5 6,671.1 Long-term debt, current maturities (2.7) (1.8) Total long-term debt $5,931.8 $6,669.3 |
Schedule of interest expense and interest income | Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Interest expense $78.3 $139.0 $183.8 $253.4 Interest income (1.9) (4.2) (10.1) (11.6) Interest expense, net $76.4 $134.8 $173.7 $241.8 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Changes in the carrying amount of goodwill | Global Global Global Institutional Healthcare & (millions) Industrial & Specialty Life Sciences Other Total December 31, 2020 $4,287.9 $564.1 $909.8 $245.1 $6,006.9 Current year business combinations (a) - 11.0 108.2 - 119.2 Prior year business combinations (b) (0.9) - - - (0.9) Effect of foreign currency translation 2.4 (0.4) (1.5) (0.1) 0.4 September 30, 2021 $4,289.4 $574.7 $1,016.5 $245.0 $6,125.6 (a) Represents goodwill associated with current year acquisitions. (b) Represents purchase accounting adjustments associated with the CID Lines acquisition. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
FAIR VALUE MEASUREMENTS | |
Schedule of the carrying amount and estimated fair value of assets and liabilities measured on recurring basis | September 30, 2021 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $45.0 $- $45.0 $- Interest rate swap agreements 2.4 - 2.4 - Liabilities Foreign currency forward contracts 31.6 - 31.6 - Interest rate swap agreements 3.9 3.9 Cross-currency swap derivative contract 2.0 - 2.0 - December 31, 2020 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $15.5 $- $15.5 $- Liabilities Foreign currency forward contracts 69.9 - 69.9 - |
Schedule of carrying amount and estimated fair value of long-term debt | September 30, 2021 December 31, 2020 Carrying Fair Carrying Fair Amount Value Amount Value Long-term debt, including current maturities $5,934.5 $6,623.3 $6,671.1 $7,704.4 |
DERIVATIVES AND HEDGING TRANS_2
DERIVATIVES AND HEDGING TRANSACTIONS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
DERIVATIVES AND HEDGING TRANSACTIONS | |
Gross fair value of the company's outstanding derivative assets and liabilities | Derivative Assets Derivative Liabilities September 30 December 31 September 30 December 31 (millions) 2021 2020 2021 2020 Derivatives designated as hedging instruments Foreign currency forward contracts $17.1 $8.1 $24.1 $54.3 Interest rate swap agreements 2.4 - 3.9 - Cross-currency swap derivative contract - - 2.0 - Derivatives not designated as hedging instruments Foreign currency forward contracts 27.9 7.4 7.5 15.6 Gross value of derivatives 47.4 15.5 37.5 69.9 Gross amounts offset in the Consolidated Balance Sheets (18.6) (12.3) (18.6) (12.3) Net value of derivatives $28.8 $3.2 $18.9 $57.6 |
Summary of notional values of outstanding derivatives | Notional Values September 30 December 31 (millions) 2021 2020 Foreign currency forward contracts $ 3,819 $ 3,702 Interest rate swap agreements 750 - Cross-currency swap derivative contract 354 - |
Schedule of amounts on the Balance Sheet related to cumulative basis adjustments for fair value hedges | Carrying amount of the hedged liabilities Cumulative amount of the fair value hedging adjustment included in the carrying amount of the hedged liabilities Third Quarter Ended Third Quarter Ended Line item in which the hedged item is included September 30 September 30 (millions) 2021 2020 2021 2020 Long-term debt $745.9 $- $5.2 $- |
Revaluation gains and losses on euro notes and forward contracts | Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Revaluation gain (loss), net of tax: Euronotes $36.7 ($83.4) $10.3 ($87.4) Cross-currency swap derivative contract (1.5) - (1.5) - Total revaluation gain (loss), net of tax $35.2 ($83.4) $8.8 ($87.4) |
Impact on AOCI and earnings from derivative contracts qualified as cash flow hedges | Third Quarter Ended September 30 2021 2020 (millions) COS SG&A Interest COS SG&A Interest Gain (loss) on derivatives in cash flow hedging relationship: Foreign currency forward contracts Amount of gain (loss) reclassified from AOCI to income ($4.6) $42.1 $- $3.1 ($101.5) $- Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value - - 5.1 - - (4.9) Interest rate swap agreements Amount of gain (loss) reclassified from AOCI to income - - (0.6) - - (0.2) Gain (loss) on derivatives not designated as hedging instruments: Foreign currency forward contracts Amount of gain (loss) recognized in income (a) - 22.8 - - (30.2) 11.3 Total gain (loss) of all derivative instruments ($4.6) $64.9 $4.5 $3.1 ($131.7) $6.2 Nine Months Ended September 30 2021 2020 (millions) COS SG&A Interest COS SG&A Interest Gain (loss) on derivatives in cash flow hedging relationship: Foreign currency forward contracts Amount of gain (loss) reclassified from AOCI to income ($9.2) $4.7 $- $9.1 ($108.8) $- Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value - - 16.4 - - 8.6 Interest rate swap agreements Amount of gain (loss) reclassified from AOCI to income - - (1.8) - - (0.7) Gain (loss) on derivatives not designated as hedging instruments: Foreign currency forward contracts Amount of gain (loss) recognized in income (a) - 28.6 - - (12.3) 11.3 Total gain (loss) of all derivative instruments ($9.2) $33.3 $14.6 $9.1 ($121.1) $19.2 (a) Gain (loss) on derivatives not designated as hedging instruments recognized in income recorded in SG&A includes discontinued operations of ( $2.5 ) in the first nine months of 2020. |
OTHER COMPREHENSIVE INCOME (L_2
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
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 | Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Derivative and Hedging Instruments Unrealized gain (loss) on derivative & hedging instruments Amount recognized in AOCI $61.2 ($126.2) $30.3 ($108.3) Loss (gain) reclassified from AOCI into income COS 4.6 (3.1) 9.2 (9.1) SG&A (42.1) 101.5 (4.7) 108.8 Interest (income) expense, net (4.5) 5.1 (14.6) (7.9) (42.0) 103.5 (10.1) 91.8 Other activity 0.5 (0.2) (0.2) (0.2) Tax impact (4.4) 3.8 (3.3) 2.6 Net of tax $15.3 ($19.1) $16.7 ($14.1) Pension and Postretirement Benefits Amount recognized in AOCI Current period net actuarial gain $- $- $145.0 $- Amount reclassified from AOCI into income Settlement charge 7.0 - 26.6 - Amortization of net actuarial loss and prior period service credits, net 16.3 15.0 59.8 44.3 23.3 15.0 231.4 44.3 Other activity 15.6 (29.8) (2.8) (21.5) Tax impact (5.5) (3.7) (55.9) (10.8) Net of tax $33.4 ($18.5) $172.7 $12.0 |
Summary of the net of tax derivative and pension and postretirement benefit amounts reclassified from AOCI into income | Third Quarter Ended Nine Months Ended September 30 September 30 2021 2020 2021 2020 (millions) Derivative (gain) loss reclassified from AOCI into income, net of tax ($31.9) $78.2 ($7.7) $69.4 Pension and postretirement benefits amortization of net actuarial losses and prior service credits and settlement charges reclassified from AOCI into income, net of tax 33.4 (18.5) 62.8 12.0 |
EARNINGS ATTRIBUTABLE TO ECOL_2
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") | |
Computations of the basic and diluted EPS | Third Quarter Ended Nine Months Ended September 30 September 30 (millions, except per share) 2021 2020 2021 2020 Net income from continuing operations attributable to Ecolab $324.5 $246.2 $828.9 $667.1 Net loss from discontinued operations - - - (2,172.5) Net income (loss) attributable to Ecolab $324.5 $246.2 $828.9 ($1,505.4) Weighted-average common shares outstanding Basic 286.4 285.4 286.1 287.5 Effect of dilutive stock options and units 2.8 3.0 2.9 3.3 Diluted 289.2 288.4 289.0 290.8 Earnings (loss) attributable to Ecolab per common share Basic EPS Continuing operations $ 1.13 $ 0.86 $ 2.90 $ 2.32 Discontinued operations $ - $ - $ - ($ 7.56) Earnings (loss) attributable to Ecolab $ 1.13 $ 0.86 $ 2.90 ($ 5.24) Diluted EPS Continuing operations $ 1.12 $ 0.85 $ 2.87 $ 2.29 Discontinued operations $ - $ - $ - ($ 7.47) Earnings (loss) attributable to Ecolab $ 1.12 $ 0.85 $ 2.87 ($ 5.18) Anti-dilutive securities excluded from the computation of diluted EPS 1.0 1.0 1.0 1.0 Amounts do not necessarily sum due to rounding. |
PENSION AND POSTRETIREMENT PL_2
PENSION AND POSTRETIREMENT PLANS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
PENSION AND POSTRETIREMENT PLANS | |
Net periodic pension and postretirement health care benefit costs | The components of net periodic pension and postretirement health care benefit expense for the third quarter ended September 30 are as follows: U.S. International U.S. Postretirement Pension Pension Health Care (millions) 2021 2020 2021 2020 2021 2020 Service cost $11.2 $16.5 $7.9 $7.9 $0.2 $0.3 Interest cost on benefit obligation 13.3 17.7 4.4 5.5 0.7 0.8 Expected return on plan assets (38.0) (38.2) (16.6) (15.7) (0.1) (0.1) Recognition of net actuarial loss (gain) 12.1 13.0 5.8 6.6 0.2 (0.1) Amortization of prior service benefit (1.7) (1.6) (0.1) (0.1) - (2.9) Curtailments and settlements (b) 7.0 - - - - - Total expense (benefit) $3.9 $7.4 $1.4 $4.2 $1.0 ($2.0) The components of net periodic pension and postretirement health care benefit expense for the nine months ended September 30 are as follows: U.S. International U.S. Postretirement Pension Pension Health Care (millions) 2021 2020 2021 2020 2021 2020 Service cost (a) $32.8 $51.9 $24.0 $23.2 $0.6 $0.9 Interest cost on benefit obligation 38.3 52.7 13.1 16.1 2.1 2.9 Expected return on plan assets (115.2) (114.6) (51.9) (46.7) (0.3) (0.3) Recognition of net actuarial (gain) loss 44.5 39.0 20.3 19.2 0.6 - Amortization of prior service benefit (5.1) (5.4) (0.5) (0.1) - (8.4) Curtailments and settlements (b) 26.6 - - - - - Total expense (benefit) $21.9 $23.6 $5.0 $11.7 $3.0 ($4.9) (a) Service cost includes discontinued operations of $2.5 in the first six months of 2020. (b) Settlement expense was recognized as special charges in the third quarter and first nine months of 2021. |
REVENUES (Tables)
REVENUES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
REVENUES | |
Schedule of operating lease revenue | Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Operating lease revenue* $103.3 $84.9 $306.4 $258.2 |
Schedule of principal activities, separated by reportable segments and geographic region | Net sales at public exchange rates by reportable segment are as follows: Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Global Industrial Product and sold equipment $1,386.0 $1,264.3 $3,941.0 $3,725.8 Service and lease equipment 217.1 205.0 637.6 600.9 Global Institutional & Specialty Product and sold equipment 889.9 758.7 2,397.7 2,248.7 Service and lease equipment 180.7 139.7 506.3 429.9 Global Healthcare & Life Sciences Product and sold equipment 259.4 292.3 795.4 788.1 Service and lease equipment 27.5 30.0 86.0 78.3 Other Product and sold equipment 82.7 64.5 224.0 196.0 Service and lease equipment 241.5 217.2 676.4 598.0 Corporate Product and sold equipment 35.8 46.6 103.5 58.9 Service and lease equipment 0.2 0.3 0.6 0.3 Total Total product and sold equipment $2,653.8 $2,426.4 $7,461.6 $7,017.5 Total service and lease equipment $667.0 $592.2 $1,906.9 $1,707.4 Net sales at public exchange rates by geographic region for the third quarter ended September 30 are as follows: Global Global Institutional Global Healthcare Industrial & Specialty & Life Sciences Other Corporate 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 North America $716.8 $683.5 $776.4 $654.1 $112.6 $113.2 $201.3 $175.7 $25.7 $34.8 Europe 353.3 325.0 166.3 127.1 154.1 170.7 70.6 59.3 0.8 2.4 Asia Pacific 199.8 180.4 48.4 47.6 14.8 27.8 17.1 14.3 1.5 1.4 Latin America 141.0 117.5 34.9 32.4 - 3.5 13.0 13.4 6.7 6.6 Greater China 102.9 85.1 32.6 26.7 1.8 1.7 19.5 16.7 0.7 0.4 India, Middle East and Africa 89.3 77.8 12.0 10.5 3.6 5.4 2.7 2.3 0.6 1.3 Total $1,603.1 $1,469.3 $1,070.6 $898.4 $286.9 $322.3 $324.2 $281.7 $36.0 $46.9 Net sales at public exchange rates by geographic region for the nine months ended September 30 are as follows: Global Global Institutional Global Healthcare Industrial & Specialty & Life Sciences Other Corporate (millions) 2021 2020 2021 2020 2021 2020 2021 2020 2021 2020 North America $2,046.0 $2,033.1 $2,133.6 $1,926.4 $320.0 $325.6 $549.8 $496.6 $73.4 $47.1 Europe 1,008.5 914.8 394.5 375.7 500.8 462.2 191.3 164.2 2.6 2.4 Asia Pacific 586.8 548.8 150.0 156.1 40.3 51.7 54.9 45.0 4.2 1.4 Latin America 400.5 362.5 97.3 103.0 1.1 6.3 37.7 35.7 19.4 6.6 Greater China 292.7 237.5 98.7 82.8 4.5 5.0 57.7 45.0 1.9 0.4 India, Middle East and Africa 244.1 230.0 29.9 34.6 14.7 15.6 9.0 7.5 2.6 1.3 Total $4,578.6 $4,326.7 $2,904.0 $2,678.6 $881.4 $866.4 $900.4 $794.0 $104.1 $59.2 Net sales by geographic region were determined based on origin of sale. Revenues in the United States made up 52% and 52% of total during the nine months ended September 30, 2021 and 2020, respectively. |
Summarized activity in the allowance for doubtful accounts | Nine Months Ended September 30 (millions) 2021 2020 Beginning balance $84.3 $55.5 Adoption of new standard - 4.3 Bad debt expense 12.4 54.6 Write-offs (23.7) (25.0) Other (a) 3.4 (1.2) Ending balance (b) $76.4 $88.2 (a) Other amounts are primarily the effects of changes in currency translations and the impact of allowance for returns and credits. (b) The allowance for doubtful accounts balances in 2021 and 2020 reflect increased reserves, primarily due to the Institutional customer base as a result of the COVID-19 pandemic. |
Schedule of contract liability | September 30 September 30 (millions) 2021 2020 Contract liability as of beginning of the year $80.4 $76.7 Revenue recognized in the period from: Amounts included in the contract liability at the beginning of the year (80.4) (76.7) Increases due to billings excluding amounts recognized as revenue during the period ended 86.7 84.0 Business combinations - 0.6 Contract liability as of end of period $86.7 $84.6 |
OPERATING SEGMENTS (Tables)
OPERATING SEGMENTS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
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 2020 net sales and operating income | December 31, 2020 2020 Reported Fixed 2020 Reported Valued at 2020 Currency Valued at 2021 (millions) Management Rates Other Rate Change Management Rates Net Sales Global Industrial $5,959.9 ($3.7) $92.0 $6,048.2 Global Institutional & Specialty 3,577.2 9.3 42.5 3,629.0 Global Healthcare & Life Sciences 1,189.1 3.7 48.3 1,241.1 Other 1,093.3 (9.3) 19.4 1,103.4 Corporate 102.4 - (1.8) 100.6 Subtotal at fixed currency rates 11,921.9 - 200.4 12,122.3 Effect of foreign currency translation (131.7) - (200.4) (332.1) Consolidated reported GAAP net sales $11,790.2 $- $- $11,790.2 Operating Income Global Industrial $1,106.0 ($0.2) $17.3 $1,123.1 Global Institutional & Specialty 321.9 (0.3) 2.4 324.0 Global Healthcare & Life Sciences 207.6 0.7 10.0 218.3 Other 131.5 (0.2) 1.5 132.8 Corporate (347.5) - (2.2) (349.7) Subtotal at fixed currency rates 1,419.5 - 29.0 1,448.5 Effect of foreign currency translation (23.8) - (29.0) (52.8) Consolidated reported GAAP operating income $1,395.7 $- $- $1,395.7 |
Schedule of financial information for each of the entity's reportable segments | Third Quarter Ended Nine Months Ended September 30 September 30 (millions) 2021 2020 2021 2020 Net Sales Global Industrial $1,620.4 $1,512.9 $4,609.7 $4,476.4 Global Institutional & Specialty 1,076.6 914.4 2,914.0 2,734.6 Global Healthcare & Life Sciences 290.2 335.1 887.4 913.3 Other 326.3 288.7 904.2 817.4 Corporate 35.9 47.2 104.1 59.5 Subtotal at fixed currency rates 3,349.4 3,098.3 9,419.4 9,001.2 Effect of foreign currency translation (28.6) (79.7) (50.9) (276.3) Consolidated reported GAAP net sales $3,320.8 $3,018.6 $9,368.5 $8,724.9 Operating Income Global Industrial $268.3 $302.3 $750.8 $799.7 Global Institutional & Specialty 196.5 83.7 398.2 229.4 Global Healthcare & Life Sciences 37.3 69.0 131.2 162.0 Other 59.2 45.8 143.4 88.4 Corporate (90.0) (74.2) (204.4) (257.4) Subtotal at fixed currency rates 471.3 426.6 1,219.2 1,022.1 Effect of foreign currency translation (5.5) (15.2) (8.3) (42.5) Consolidated reported GAAP operating income $465.8 $411.4 $1,210.9 $979.6 |
NEW ACCOUNTING PRONOUNCEMENTS (
NEW ACCOUNTING PRONOUNCEMENTS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
NEW ACCOUNTING PRONOUNCEMENTS | |
Schedule of new accounting pronouncements | Standards that are not yet adopted: Required Date of Date of Effect on the Standard Issuance Description Adoption Financial Statements ASU 2020-04 - Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting March 2020 LIBOR, a widely used reference rate for pricing financial products is scheduled to be discontinued on December 31, 2021. This standard provides optional expedients and exceptions if certain criteria are met when accounting for contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. Application of guidance is optional until the options and expedients expire on December 31, 2022. The Company has not elected any expedients and adoption of this standard is not expected to have a material impact on the Company's financial statements. Standards that were adopted: Date of Date of Effect on the Standard Issuance Description Adoption Financial Statements ASU 2019-12 - Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes December 2019 Simplifies the accounting for income taxes by removing certain exceptions to the general principles related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and recognition of deferred tax liabilities for outside basis differences. The new standard also simplifies the accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the basis of goodwill. January 1, 2021 Adoption of this standard did not have a material impact on the Company's financial statements. |
CONSOLIDATED FINANCIAL INFORM_2
CONSOLIDATED FINANCIAL INFORMATION (Details) - 9 months ended Sep. 30, 2021 | segment | item |
CONSOLIDATED FINANCIAL INFORMATION | ||
Number of Reportable Segments | 3 | 3 |
SPECIAL (GAINS) AND CHARGES - C
SPECIAL (GAINS) AND CHARGES - Charges Reported on Statement of Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Special (gains) and charges | ||||
Other special gains and charges | $ 3.6 | $ 10.7 | ||
Other (income) expense | 6.3 | $ 35 | 36.7 | $ 120.3 |
Total special (gains) and charges | 98.5 | 127.6 | 171.8 | 249.7 |
Cost of sales | ||||
Special (gains) and charges | ||||
Restructuring activities | 2.2 | 1 | 24.1 | 6.6 |
Acquisition and integration activities | 1.5 | 4.1 | ||
Other special gains and charges | 5.2 | 0.3 | 26.2 | |
Other (income) expense | 52.9 | 9.5 | 76.2 | 45.6 |
Cost of sales | C O V I D 19 | ||||
Special (gains) and charges | ||||
COVID-19 | 50.7 | 1.8 | 51.8 | 8.7 |
Special (gains) and charges | ||||
Special (gains) and charges | ||||
Restructuring activities | 0.4 | 26.9 | 6.5 | 31.4 |
Acquisition and integration activities | 0.8 | 2.7 | 3.3 | 5.5 |
Acquisition and integration costs, after tax | 0.8 | (2.3) | 2.9 | 4.3 |
Disposal And Impairment charges | 45.9 | |||
Other special gains and charges | 3.6 | 8.4 | 10.7 | 30.3 |
Other (income) expense | 6.3 | 35 | 36.7 | 120.3 |
Special (gains) and charges | C O V I D 19 | ||||
Special (gains) and charges | ||||
COVID-19 | 1.5 | (3) | 16.2 | 7.2 |
Operating income subtotal | ||||
Special (gains) and charges | ||||
Other (income) expense | 59.2 | 44.5 | 112.9 | 165.9 |
Interest expense | ||||
Special (gains) and charges | ||||
Acquisition and integration activities | 0.7 | |||
Acquisition and integration costs, after tax | 0.6 | |||
Other (income) expense | 32.3 | $ 83.1 | 32.3 | $ 83.8 |
Other (income) expense | ||||
Special (gains) and charges | ||||
Other (income) expense | $ 7 | $ 26.6 |
SPECIAL (GAINS) AND CHARGES - R
SPECIAL (GAINS) AND CHARGES - Restructuring and Non-Restructuring Activity (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | 36 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2020 | |
Other restructuring information | ||||||||
Restructuring Costs | $ (35.1) | $ (9.4) | ||||||
Other special gains and charges | $ 3.6 | 10.7 | ||||||
Other special gains and charges, after-tax | 2.7 | 8.3 | ||||||
Special (gains) and charges | 6.3 | $ 35 | 36.7 | 120.3 | ||||
C O V I D 19 | ||||||||
Non-restructuring Special (Gains) and Charges | ||||||||
Inventory-related reserves | 50 | 50 | ||||||
Expenses Incurred To Pay Employees Impacted By Pandemic | 2.6 | 4.1 | 12.6 | 30.6 | ||||
Net charges (gains) related to the pandemic | 40.6 | (0.9) | 51.9 | 12.3 | ||||
Medical charges and testing fee | 3.1 | 11.5 | ||||||
Gain from government subsidy | 3.5 | |||||||
Special (gains) and charges | ||||||||
Other restructuring information | ||||||||
Restructuring charges incurred, pre-tax | 0.4 | 26.9 | 6.5 | 31.4 | ||||
Business combination advisory and legal fees, pre tax | 0.8 | 2.7 | 3.3 | 5.5 | ||||
Business combination advisory and legal fees, after tax | 0.8 | (2.3) | 2.9 | 4.3 | ||||
Other special gains and charges | 3.6 | 8.4 | 10.7 | 30.3 | ||||
Special (gains) and charges | 6.3 | 35 | 36.7 | 120.3 | ||||
Disposal And Impairment charges | 45.9 | |||||||
Disposal And Impairment charges, after tax | 45 | |||||||
Equity Method Investment, Other than Temporary Impairment | $ 28.6 | |||||||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | $ (17.3) | |||||||
Non-restructuring Special (Gains) and Charges | ||||||||
Gain (loss) on sale of business, before tax | (17.3) | |||||||
Gain (loss) on sale of business, net of tax | $ (16.3) | |||||||
Litigation related charges, before tax | 8.4 | 30.3 | ||||||
Litigation related charges, after tax | 7.2 | 23.7 | ||||||
Cost of sales | ||||||||
Other restructuring information | ||||||||
Restructuring charges incurred, pre-tax | 2.2 | 1 | 24.1 | 6.6 | ||||
Business combination advisory and legal fees, pre tax | 1.5 | 4.1 | ||||||
Other special gains and charges | 5.2 | 0.3 | 26.2 | |||||
Special (gains) and charges | 52.9 | 9.5 | 76.2 | 45.6 | ||||
Cost of sales | C O V I D 19 | ||||||||
Non-restructuring Special (Gains) and Charges | ||||||||
Gain from government subsidy | 3.5 | 5.3 | 6.1 | 14.7 | ||||
Interest expense | ||||||||
Other restructuring information | ||||||||
Business combination advisory and legal fees, pre tax | 0.7 | |||||||
Business combination advisory and legal fees, after tax | 0.6 | |||||||
Special (gains) and charges | 32.3 | 83.1 | 32.3 | 83.8 | ||||
Non-restructuring Special (Gains) and Charges | ||||||||
Debt refinancing charges, pre-tax | 32.3 | 83.1 | ||||||
Debt refinancing charges, net of tax | 28.4 | 64 | ||||||
Other (income) expense | ||||||||
Other restructuring information | ||||||||
Special (gains) and charges | 7 | 26.6 | ||||||
Pension settlements and curtailments | 7 | 26.6 | ||||||
Pension settlements and curtailments, after tax | 5.3 | 20.2 | ||||||
Product and sold equipment | ||||||||
Other restructuring information | ||||||||
Business combination advisory and legal fees, pre tax | 1.5 | 4.1 | ||||||
Business combination advisory and legal fees, after tax | 1.3 | 3.2 | ||||||
Product and sold equipment | Cost of sales | ||||||||
Other restructuring information | ||||||||
Other special gains and charges | 5.2 | 0.3 | 26.2 | |||||
Other special gains and charges, after-tax | 3.5 | 0.2 | 17.8 | |||||
Special (gains) and charges | 52.9 | $ 9.5 | 76.2 | $ 45.6 | ||||
Institutional Advancement Program | ||||||||
Restructuring | ||||||||
Recorded expense (income) and accrual | 9.5 | $ 35.2 | ||||||
Net cash payments | (21.6) | (10.5) | ||||||
Non-cash net charges | (4.6) | |||||||
Other restructuring information | ||||||||
Restructuring charge expected to be incurred, pre-tax | 80 | 80 | ||||||
Restructuring charge expected to be incurred, after tax | 60 | 60 | ||||||
Restructuring liability | 8 | 8 | 24.7 | $ 24.7 | ||||
Restructuring charges incurred to date, pre-tax | 44.7 | 44.7 | ||||||
Restructuring charges incurred to date, after-tax | 33.9 | 33.9 | ||||||
Restructuring charges incurred, pre-tax | 1.4 | 9.5 | ||||||
Restructuring charges incurred, after tax | 1.4 | 7.5 | ||||||
Institutional Advancement Program | Employee termination costs | ||||||||
Restructuring | ||||||||
Recorded expense (income) and accrual | 2.2 | 25.6 | ||||||
Net cash payments | (18.9) | (0.9) | ||||||
Other restructuring information | ||||||||
Restructuring liability | 8 | 8 | 24.7 | 24.7 | ||||
Institutional Advancement Program | Asset disposals | ||||||||
Restructuring | ||||||||
Recorded expense (income) and accrual | 6 | |||||||
Non-cash net charges | (6) | |||||||
Institutional Advancement Program | Other | ||||||||
Restructuring | ||||||||
Recorded expense (income) and accrual | 1.3 | 9.6 | ||||||
Net cash payments | (2.7) | (9.6) | ||||||
Non-cash net charges | 1.4 | |||||||
Accelerate 2020 Restructuring Plan | ||||||||
Restructuring | ||||||||
Recorded expense | 2.9 | 239.2 | ||||||
Net cash payments | (33.7) | (155.3) | ||||||
Non-cash charges | (0.4) | (11.2) | ||||||
Effect of foreign currency translation | (0.9) | |||||||
Other restructuring information | ||||||||
Restructuring charge expected to be incurred, pre-tax | 255 | 255 | ||||||
Restructuring charge expected to be incurred, after tax | 195 | 195 | ||||||
Restructuring liability | 40.6 | 40.6 | 71.8 | 71.8 | ||||
Accelerate 2020 Restructuring Plan | Special (gains) and charges | ||||||||
Other restructuring information | ||||||||
Restructuring liability | 40.6 | 40.6 | ||||||
Restructuring charges incurred to date, pre-tax | 242.1 | 242.1 | ||||||
Restructuring charges incurred to date, after-tax | 186.6 | 186.6 | ||||||
Restructuring charges incurred, pre-tax | (1.5) | 2.9 | ||||||
Restructuring charges incurred, after tax | (1.2) | 2.8 | ||||||
Accelerate 2020 Restructuring Plan | Employee termination costs | ||||||||
Restructuring | ||||||||
Recorded expense | 2.4 | 212 | ||||||
Net cash payments | (31.6) | (144.3) | ||||||
Effect of foreign currency translation | (0.9) | |||||||
Other restructuring information | ||||||||
Restructuring liability | 37.6 | 37.6 | 66.8 | 66.8 | ||||
Accelerate 2020 Restructuring Plan | Asset disposals | ||||||||
Restructuring | ||||||||
Recorded expense | 0.3 | 8 | ||||||
Net cash payments | 1.2 | |||||||
Non-cash charges | (0.3) | (9.2) | ||||||
Accelerate 2020 Restructuring Plan | Other | ||||||||
Restructuring | ||||||||
Recorded expense | 0.2 | 19.2 | ||||||
Net cash payments | (2.1) | (12.2) | ||||||
Non-cash charges | (0.1) | (2) | ||||||
Other restructuring information | ||||||||
Restructuring liability | 3 | 3 | 5 | 5 | ||||
Other Restructuring Plan | ||||||||
Other restructuring information | ||||||||
Restructuring charges incurred, pre-tax | 18.2 | |||||||
Restructuring charges incurred, after tax | 16.9 | |||||||
Restructuring net gain | 0.3 | |||||||
Restructuring net gain, net of tax | 0.5 | |||||||
Prior Year Plans | ||||||||
Other restructuring information | ||||||||
Restructuring liability | $ 4.6 | 4.6 | $ 5.9 | $ 5.9 | ||||
Cash payments | $ 10.5 |
ACQUISITIONS AND DISPOSITIONS -
ACQUISITIONS AND DISPOSITIONS - Acquisition Summary (Details) - USD ($) $ in Millions | Oct. 28, 2021 | May 11, 2020 | Sep. 30, 2021 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 |
Business Acquisition [Line Items] | |||||||
Goodwill | $ 6,125.6 | $ 6,125.6 | $ 6,006.9 | ||||
Accounts receivable | $ 30.1 | ||||||
Weighted average useful lives of identifiable intangible assets acquired | 14 years | ||||||
Prior year business combinations, net intangible assets adjustments | $ 1.3 | ||||||
Prior year business combinations, goodwill adjustments | $ (0.9) | 0.3 | |||||
Contingent consideration payment | 1.4 | ||||||
2020 Acquisitions | |||||||
Business Acquisition [Line Items] | |||||||
Contingent consideration payment | $ 3.5 | ||||||
CID Lines | |||||||
Business Acquisition [Line Items] | |||||||
Total consideration | 506.9 | ||||||
Annualized pre-acquisition sales | $ 110 | ||||||
Tangible assets | 54.1 | ||||||
Total assets acquired | 307.9 | ||||||
Goodwill | 274.8 | ||||||
Total liabilities | 97.2 | ||||||
Net consideration transferred to sellers | 485.5 | ||||||
Property, plant and equipment | 7.7 | ||||||
Inventory | 16.3 | ||||||
Deferred tax liabilities | 64.8 | ||||||
Current liabilities | 32.4 | ||||||
Goodwill | 274.8 | ||||||
Prior year business combinations, net intangible assets adjustments | (0.9) | ||||||
CID Lines | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Identifiable intangible assets | $ 147.5 | ||||||
Weighted average useful lives of identifiable intangible assets acquired | 14 years | ||||||
CID Lines | Trademarks | |||||||
Business Acquisition [Line Items] | |||||||
Identifiable intangible assets | $ 58.6 | ||||||
Weighted average useful lives of identifiable intangible assets acquired | 14 years | ||||||
CID Lines | Acquired Technologies And Product Registrations | |||||||
Business Acquisition [Line Items] | |||||||
Identifiable intangible assets | $ 47.7 | ||||||
Weighted average useful lives of identifiable intangible assets acquired | 16 years | ||||||
Purolite | Subsequent event | |||||||
Business Acquisition [Line Items] | |||||||
Total aggregate purchase price | $ 3.7 | ||||||
Acquisitions | |||||||
Business Acquisition [Line Items] | |||||||
Net tangible assets (liabilities) acquired and equity method investments | 14.8 | 12.4 | |||||
Customer relationships | 41 | 72.1 | |||||
Trademarks | 1.1 | 4.7 | |||||
Non-compete agreements | 3 | 3 | |||||
Other technology | 1.5 | ||||||
Total intangible assets | 45.1 | 81.3 | |||||
Goodwill | 60.2 | 119.2 | |||||
Total aggregate purchase price | 120.1 | 212.9 | |||||
Acquisition related liabilities and contingent consideration | (4.4) | ||||||
Net cash paid for acquisitions, including acquisition-related liabilities and contingent consideration | $ 120.1 | $ 208.5 |
ACQUISITIONS AND DISPOSITIONS_2
ACQUISITIONS AND DISPOSITIONS - Disposition (Details) $ in Millions | 3 Months Ended | 9 Months Ended |
Jun. 30, 2020USD ($) | Sep. 30, 2021item | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Number of business dispositions | item | 0 | |
Holchem Group Limited [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total Consideration | $ 106.6 | |
Cash received from sale of business | 55.4 | |
Disposal Group Including Discontinued Operation, Consideration, Notes Receivable | 51.2 | |
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal After Tax | (16.3) | |
Disposal Group, Including Discontinued Operation, Revenue | $ 55 |
DISCONTINUED OPERATIONS - Summa
DISCONTINUED OPERATIONS - Summary of Assets and Liabilities Transferred (Details) - Discontinued Operations, Disposed of By Sale - ChampionX $ in Millions | Jun. 03, 2020USD ($)shares |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Shares accepted | shares | 4,955,552 |
Number of shares exchanged | shares | 122,200,000 |
Share Conversion Rights | shares | 1 |
Discontinued Operation, Assets And Liabilities Transferred [Abstract] | |
Cash and cash equivalent | $ 60.6 |
Current assets | 810.5 |
Non-current Assets | 3,222.3 |
Total assets | 4,093.4 |
Current liabilities | 313 |
Non-current liabilities | 293.7 |
Total liabilities | 606.7 |
Net assets distributed to ChampionX | (3,486.7) |
Fair value of shares exchanged | 1,051.4 |
Cash received from ChampionX | 527.4 |
Consideration received less net assets | (1,907.9) |
ChampionX cumulative translation adjustment ("CTA") write-off | (229.9) |
Loss on separation | $ (2,137.8) |
DISCONTINUED OPERATIONS - Sum_2
DISCONTINUED OPERATIONS - Summarized Results of Discontinued Operations (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |
Net (loss) income including noncontrolling interest | $ (2,170.3) |
Net income from discontinued operations attributable to noncontrolling interest | 2.2 |
Net (loss) income from discontinued operations, net of tax | (2,172.5) |
ChampionX | Discontinued Operations, Disposed of By Sale | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |
Net sales | 958.5 |
Cost of sales (including special charges) | 702.1 |
Selling, general and administrative expenses | 180.5 |
Special (gains) and charges | 2,221.7 |
Operating income | (2,145.8) |
Other (income) expense | 0.3 |
Interest expense (income), net | 0.2 |
Income before income taxes | (2,146.3) |
Provision for income taxes | 24 |
Net (loss) income including noncontrolling interest | (2,170.3) |
Net income from discontinued operations attributable to noncontrolling interest | 2.2 |
Net (loss) income from discontinued operations, net of tax | (2,172.5) |
Special (gains) and charges, including non-controlling interest | 2,221.7 |
Tax expense, friction costs associated with separation activity | 22.7 |
ChampionX | Discontinued Operations, Disposed of By Sale | Product and sold equipment | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |
Net sales | 858.9 |
Cost of sales (including special charges) | 621.7 |
ChampionX | Discontinued Operations, Disposed of By Sale | Service and lease equipment | |
Disposal Group, Including Discontinued Operation, Income Statement Disclosures [Abstract] | |
Net sales | 99.6 |
Cost of sales (including special charges) | $ 80.4 |
DISCONTINUED OPERATIONS - Sum_3
DISCONTINUED OPERATIONS - Summary of Assets and Liabilities of Discontinued Operations (Details) - USD ($) $ in Millions | Jun. 03, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 |
Disposal Group, Including Discontinued Operation, Classified Balance Sheet Disclosures [Abstract] | ||||||
Accounts receivable, net | $ 2,384.1 | $ 2,384.1 | $ 2,273.8 | |||
ChampionX | Discontinued Operations, Disposed of By Sale | ||||||
Disposal Group, Including Discontinued Operation, Classified Balance Sheet Disclosures [Abstract] | ||||||
Term of post-separation agreement | 18 months | |||||
Period of time post-separation that the entity may transfer or receive certain products | 36 months | |||||
Post-separation sales | 35.8 | $ 46.6 | 103.5 | $ 58.9 | ||
Accounts receivable, net | $ 18 | $ 18 |
BALANCE SHEETS INFORMATION (Det
BALANCE SHEETS INFORMATION (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts receivable, net | ||||
Accounts receivable | $ 2,460.5 | $ 2,358.1 | ||
Allowance for doubtful accounts | (76.4) | (84.3) | $ (88.2) | $ (55.5) |
Total | 2,384.1 | 2,273.8 | ||
Inventories | ||||
Finished goods | 886.5 | 789.6 | ||
Raw materials and parts | 550.2 | 511.2 | ||
Inventories at FIFO cost | 1,436.7 | 1,300.8 | ||
FIFO cost to LIFO cost difference | (58.5) | (15.6) | ||
Total | 1,378.2 | 1,285.2 | ||
Other current assets | ||||
Prepaid assets | 122.8 | 99.1 | ||
Taxes receivable | 158 | 168.6 | ||
Derivative assets | 25.6 | 3.2 | ||
Other current assets | 20.2 | 27.3 | ||
Total | 326.6 | 298.2 | ||
Property, plant and equipment, net | ||||
Land | 153.2 | 159.7 | ||
Buildings and leasehold improvements | 1,083.7 | 1,060 | ||
Machinery and equipment | 1,828.6 | 1,830.1 | ||
Merchandising and customer equipment | 2,714.6 | 2,691 | ||
Capitalized software | 863.7 | 820.8 | ||
Construction in progress | 279.7 | 219.8 | ||
Property, plant and equipment, gross | 6,923.5 | 6,781.4 | ||
Accumulated depreciation | (3,853.9) | (3,656.5) | ||
Total | 3,069.6 | 3,124.9 | ||
Intangible assets subject to amortization: | ||||
Other intangible assets, gross | 3,683.1 | 3,611.5 | ||
Accumulated amortization | (2,023.4) | (1,864.5) | ||
Net intangible assets subject to amortization | 1,659.7 | 1,747 | ||
Total | 2,889.7 | 2,977 | ||
Other assets | ||||
Deferred income taxes | 150.8 | 163.2 | ||
Pension | 46.9 | 33 | ||
Derivative asset | 3.2 | |||
Other | 276.2 | 279.8 | ||
Total | 477.1 | 476 | ||
Other current liabilities | ||||
Discounts and rebates | 341 | 304.1 | ||
Dividends payable | 137.5 | 137.2 | ||
Interest payable | 44 | 51.7 | ||
Taxes payable, other than income | 131.7 | 151.8 | ||
Derivative liabilities | 1 | 25.8 | ||
Restructuring | 48.9 | 98.1 | ||
Contract liability | 86.7 | 80.4 | ||
Operating lease liabilities | 115.7 | 125.6 | ||
Other | 211.3 | 214.2 | ||
Total | 1,117.8 | 1,188.9 | ||
Accumulated other comprehensive loss | ||||
Unrealized loss on derivative financial instruments, net of tax | (4.4) | (21.1) | ||
Unrecognized pension and postretirement benefit expense, net of tax | (762.5) | (935.2) | ||
Cumulative translation, net of tax | (966.6) | (1,038.1) | ||
Total | (1,733.5) | (1,994.4) | ||
Customer relationships | ||||
Intangible assets subject to amortization: | ||||
Other intangible assets, gross | 2,593.2 | 2,530.9 | ||
Accumulated amortization | (1,432.6) | (1,319.1) | ||
Trademarks | ||||
Intangible assets subject to amortization: | ||||
Other intangible assets, gross | 348 | 348 | ||
Accumulated amortization | (169.7) | (155) | ||
Patents | ||||
Intangible assets subject to amortization: | ||||
Other intangible assets, gross | 499.5 | 492.5 | ||
Accumulated amortization | (266.9) | (244.6) | ||
Other technology | ||||
Intangible assets subject to amortization: | ||||
Other intangible assets, gross | 242.4 | 240.1 | ||
Accumulated amortization | (154.2) | (145.8) | ||
Trade names | ||||
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 | Sep. 30, 2021 | Dec. 31, 2020 |
Components of the company's debt obligations | ||
Long-term debt, current maturities | $ 2.7 | $ 1.8 |
Short-term debt including current maturities of long-term debt | 18.7 | 17.3 |
Commercial paper. | ||
Components of the company's debt obligations | ||
Maximum borrowing capacity, commercial paper | 2,000 | |
U.S. commercial paper program | ||
Components of the company's debt obligations | ||
Maximum borrowing capacity, commercial paper | 2,000 | |
Outstanding commercial paper | 0 | |
European commercial paper | ||
Components of the company's debt obligations | ||
Maximum borrowing capacity, commercial paper | 2,000 | |
Outstanding commercial paper | 0 | |
Notes payable | ||
Components of the company's debt obligations | ||
Notes payable | 16 | 15.5 |
Credit Facility | ||
Components of the company's debt obligations | ||
Maximum borrowing capacity under the credit agreement | 2,000 | |
Amount outstanding under the credit agreement | $ 0 | $ 0 |
DEBT AND INTEREST - Other Debt
DEBT AND INTEREST - Other Debt Information (Details) € in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2021USD ($) | Aug. 31, 2021USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021EUR (€) | Dec. 31, 2020USD ($) | |
Debt instrument | ||||||||
CARRYING VALUE | $ 5,934.5 | $ 5,934.5 | $ 5,934.5 | $ 6,671.1 | ||||
Long-term debt, current maturities | (2.7) | (2.7) | (2.7) | (1.8) | ||||
Long-term debt | 5,931.8 | 5,931.8 | 5,931.8 | 6,669.3 | ||||
Payment for Debt Extinguishment or Debt Prepayment Cost | 25 | |||||||
Interest | ||||||||
Interest expense | 78.3 | $ 139 | 183.8 | $ 253.4 | ||||
Interest income | (1.9) | (4.2) | (10.1) | (11.6) | ||||
Interest expense, net | 76.4 | 134.8 | 173.7 | 241.8 | ||||
Debt extinguishment charges | $ (29.4) | $ (77.1) | ||||||
Interest expense | ||||||||
Debt instrument | ||||||||
Debt refinancing charges, pre-tax | 32.3 | 83.1 | ||||||
Debt refinancing charges, net of tax | 28.4 | $ 64 | ||||||
Public Notes | ||||||||
Debt instrument | ||||||||
Principal outstanding payable at time of prepayment of notes (as a percent) | 101.00% | |||||||
Thirty year 2011 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 384.2 | 384.2 | $ 384.2 | 452.2 | ||||
Aggregate principal amount | 389 | 389 | $ 389 | |||||
Debt instrument, term | 30 years | |||||||
Five year 2017 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 498.6 | |||||||
Aggregate principal amount | 500 | $ 500 | $ 500 | |||||
Debt instrument, term | 5 years | |||||||
Debt extinguishment amount | $ 500 | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.375% | 2.375% | 2.375% | 2.375% | ||||
Interest | ||||||||
Interest rate (as a percent) | 2.375% | 2.375% | 2.375% | 2.375% | ||||
Ten year 2017 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | $ 493.6 | $ 493.6 | $ 493.6 | 496 | ||||
Aggregate principal amount | 500 | 500 | $ 500 | |||||
Debt instrument, term | 10 years | |||||||
Thirty year 2017 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 424 | 424 | $ 424 | 611.9 | ||||
Aggregate principal amount | 484 | 484 | $ 484 | |||||
Debt instrument, term | 30 years | |||||||
Thirty year 2020 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 490.3 | 490.3 | $ 490.3 | 490.1 | ||||
Aggregate principal amount | 500 | 500 | $ 500 | |||||
Debt instrument, term | 30 years | |||||||
Thirty-four year 2021 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 534.9 | 534.9 | $ 534.9 | |||||
Aggregate principal amount | $ 685 | $ 685 | $ 685 | |||||
Debt instrument, term | 34 years | |||||||
Debt Conversion, Original Debt, Amount | $ 385 | |||||||
Debt exchanged | 385 | |||||||
Payment for Debt Extinguishment or Debt Prepayment Cost | 118 | |||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 143 | |||||||
Value of notes tendered in an exchange offering | 387 | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.75% | 2.75% | 2.75% | 2.75% | ||||
Debt, unamortized discounts and financing costs | $ 143 | |||||||
Interest | ||||||||
Interest rate (as a percent) | 2.75% | 2.75% | 2.75% | 2.75% | ||||
Ten year 2020 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | $ 708.3 | $ 708.3 | $ 708.3 | 765.2 | ||||
Aggregate principal amount | 698 | 698 | $ 698 | |||||
Debt instrument, term | 10 years | |||||||
Ten year 2020 senior notes, maturing in 2031 | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 594.9 | 594.9 | $ 594.9 | 594.4 | ||||
Aggregate principal amount | 600 | 600 | $ 600 | |||||
Debt instrument, term | 10 years | |||||||
Seven year 2016 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 399 | |||||||
Aggregate principal amount | 400 | $ 400 | $ 400 | |||||
Debt instrument, term | 7 years | |||||||
Debt extinguishment amount | $ 400 | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.25% | 3.25% | 3.25% | 3.25% | ||||
Interest | ||||||||
Interest rate (as a percent) | 3.25% | 3.25% | 3.25% | 3.25% | ||||
Seven year 2016 senior euro notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | $ 676.1 | $ 676.1 | $ 676.1 | 682 | ||||
Aggregate principal amount | € | € 575 | |||||||
Debt instrument, term | 7 years | |||||||
Ten year 2016 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 745.9 | 745.9 | $ 745.9 | 745.3 | ||||
Aggregate principal amount | 750 | 750 | $ 750 | |||||
Debt instrument, term | 10 years | |||||||
Thirty year 2016 senior notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 197.1 | 197.1 | $ 197.1 | 246.4 | ||||
Aggregate principal amount | 200 | 200 | $ 200 | |||||
Debt instrument, term | 30 years | |||||||
Ten Year 2015 senior euro notes | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | 676.6 | 676.6 | $ 676.6 | 682.9 | ||||
Aggregate principal amount | € | € 575 | |||||||
Debt instrument, term | 10 years | |||||||
Private Placement 34-Year 2021 Senior Notes | ||||||||
Debt instrument | ||||||||
Aggregate principal amount | 300 | 300 | $ 300 | |||||
Other | ||||||||
Debt instrument | ||||||||
CARRYING VALUE | $ 8.6 | $ 8.6 | $ 8.6 | $ 7.1 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($)segment | Sep. 30, 2020USD ($) | |
Changes in the carrying amount of goodwill for each of the company's reportable segments | ||||
Number of reporting units | segment | 11 | |||
Impairment of goodwill | $ 0 | $ 0 | ||
Changes in the carrying amount of goodwill | ||||
Beginning goodwill | 6,006.9 | |||
Current year business combinations | 119.2 | |||
Prior year business combinations | (0.9) | 0.3 | ||
Effect of foreign currency translation | 0.4 | |||
Ending goodwill | $ 6,125.6 | 6,125.6 | ||
Future estimated amortization expense related to amortizable other identifiable intangible assets | ||||
Estimated expense for the remaining nine-month period | 53 | 53 | ||
Total amortization expense related to other intangible assets | 57.7 | $ 58.9 | 174.4 | $ 162.1 |
Previously Reported | ||||
Changes in the carrying amount of goodwill | ||||
Beginning goodwill | 6,006.9 | |||
Nalco | Trademarks | ||||
Changes in the carrying amount of goodwill | ||||
Impairment of indefinite life intangible asset | 0 | |||
Carrying value of asset subject to impairment testing | 1,200 | 1,200 | ||
Global Industrial | ||||
Changes in the carrying amount of goodwill | ||||
Prior year business combinations | (0.9) | |||
Effect of foreign currency translation | 2.4 | |||
Ending goodwill | 4,289.4 | 4,289.4 | ||
Global Industrial | Previously Reported | ||||
Changes in the carrying amount of goodwill | ||||
Beginning goodwill | 4,287.9 | |||
Global Institutional & Specialty | ||||
Changes in the carrying amount of goodwill | ||||
Current year business combinations | 11 | |||
Effect of foreign currency translation | (0.4) | |||
Ending goodwill | 574.7 | 574.7 | ||
Global Institutional & Specialty | Previously Reported | ||||
Changes in the carrying amount of goodwill | ||||
Beginning goodwill | 564.1 | |||
Global Healthcare and Life Sciences | ||||
Changes in the carrying amount of goodwill | ||||
Current year business combinations | 108.2 | |||
Effect of foreign currency translation | (1.5) | |||
Ending goodwill | 1,016.5 | 1,016.5 | ||
Global Healthcare and Life Sciences | Previously Reported | ||||
Changes in the carrying amount of goodwill | ||||
Beginning goodwill | 909.8 | |||
Other | ||||
Changes in the carrying amount of goodwill | ||||
Effect of foreign currency translation | (0.1) | |||
Ending goodwill | $ 245 | 245 | ||
Other | Previously Reported | ||||
Changes in the carrying amount of goodwill | ||||
Beginning goodwill | $ 245.1 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - Recurring - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Carrying Amount | ||
Assets: | ||
Foreign currency forward contracts | $ 45 | $ 15.5 |
Interest rate swap agreements | 2.4 | |
Liabilities: | ||
Foreign currency forward contracts | 69.9 | |
Interest rate swap agreements | 3.9 | |
Carrying Amount | Foreign currency forward contracts. | ||
Liabilities: | ||
Foreign currency forward contracts | 31.6 | |
Carrying Amount | Cross Currency Interest Rate Contract | ||
Liabilities: | ||
Foreign currency forward contracts | 2 | |
Level 2 | ||
Assets: | ||
Foreign currency forward contracts | 45 | 15.5 |
Interest rate swap agreements | 2.4 | |
Liabilities: | ||
Foreign currency forward contracts | $ 69.9 | |
Interest rate swap agreements | 3.9 | |
Level 2 | Foreign currency forward contracts. | ||
Liabilities: | ||
Foreign currency forward contracts | 31.6 | |
Level 2 | Cross Currency Interest Rate Contract | ||
Liabilities: | ||
Foreign currency forward contracts | $ 2 |
FAIR VALUE MEASUREMENTS - Long-
FAIR VALUE MEASUREMENTS - Long-term Debt (Details) - USD ($) $ in Millions | Sep. 30, 2021 | Dec. 31, 2020 |
Carrying Amount | ||
Carrying amount and fair value of financial instruments | ||
Long-term debt, including current maturities | $ 5,934.5 | $ 6,671.1 |
Fair Value | Level 2 | ||
Carrying amount and fair value of financial instruments | ||
Long-term debt, including current maturities | $ 6,623.3 | $ 7,704.4 |
DERIVATIVES AND HEDGING TRANS_3
DERIVATIVES AND HEDGING TRANSACTIONS - Derivative Positions Summary (Details) € in Millions, $ in Millions | Sep. 30, 2021USD ($) | Sep. 30, 2021EUR (€) | Jul. 31, 2021EUR (€) | Dec. 31, 2020USD ($) |
Asset Derivatives | ||||
Gross value of derivatives | $ 47.4 | $ 15.5 | ||
Gross amounts offset in the Consolidated Balance Sheet | (18.6) | (12.3) | ||
Net value of derivatives presented in the Consolidated Balance Sheet | 28.8 | 3.2 | ||
Liability Derivatives | ||||
Gross value of derivatives | 37.5 | 69.9 | ||
Gross amounts offset in the Consolidated Balance Sheet | (18.6) | (12.3) | ||
Net value of derivatives presented in the Consolidated Balance Sheet | 18.9 | 57.6 | ||
Cash collateral received | 0 | |||
Cash collateral pledged | 0 | |||
Foreign currency forward contracts. | ||||
Liability Derivatives | ||||
Notional values | 3,819 | 3,702 | ||
Interest rate swap agreements | ||||
Liability Derivatives | ||||
Notional values | 750 | |||
Cross Currency Interest Rate Contract | ||||
Liability Derivatives | ||||
Notional values | 354 | |||
Cross Currency Interest Rate Contract | Net Investment Hedges | ||||
Liability Derivatives | ||||
Notional values | 354 | € 300 | € 300 | |
Derivatives designated as hedging instruments | Foreign currency forward contracts. | ||||
Asset Derivatives | ||||
Gross value of derivatives | 17.1 | 8.1 | ||
Liability Derivatives | ||||
Gross value of derivatives | 24.1 | 54.3 | ||
Derivatives designated as hedging instruments | Interest rate swap agreements | ||||
Asset Derivatives | ||||
Gross value of derivatives | 2.4 | |||
Liability Derivatives | ||||
Gross value of derivatives | 3.9 | |||
Derivatives designated as hedging instruments | Cross Currency Interest Rate Contract | ||||
Liability Derivatives | ||||
Gross value of derivatives | 2 | |||
Derivatives not designated as hedging instruments | Foreign currency forward contracts. | ||||
Asset Derivatives | ||||
Gross value of derivatives | 27.9 | 7.4 | ||
Liability Derivatives | ||||
Gross value of derivatives | $ 7.5 | $ 15.6 |
DERIVATIVES AND HEDGING TRANS_4
DERIVATIVES AND HEDGING TRANSACTIONS - Information by Type of Derivative and Hedging Activities (Details) € in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||||||||
Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Oct. 29, 2021USD ($) | Sep. 30, 2021EUR (€) | Jul. 31, 2021USD ($) | Jul. 31, 2021EUR (€) | Mar. 31, 2021USD ($) | Dec. 31, 2020USD ($) | |
Fair Value Hedges | ||||||||||
Cumulative amount of fair value hedging adjustment | $ 5.2 | $ 5.2 | ||||||||
Derivative liability | 18.9 | 18.9 | $ 57.6 | |||||||
Net Investment Hedges | ||||||||||
Revaluation gain (loss), net of tax | 35.2 | $ (83.4) | $ 8.8 | $ (87.4) | ||||||
Derivative Summary | ||||||||||
Maximum period for hedged transactions | 3 years | |||||||||
Cash collateral received | $ 0 | $ 0 | ||||||||
Senior notes | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Interest rate (as a percent) | 4.80% | 4.80% | 4.80% | 3.25% | 3.25% | 3.25% | ||||
Fair Value Hedges | ||||||||||
Aggregate principal amount | $ 250 | $ 250 | $ 250 | $ 250 | ||||||
Interest rate (as a percent) | 4.80% | 4.80% | 4.80% | 3.25% | 3.25% | 3.25% | ||||
Thirty year 2016 senior notes | ||||||||||
Fair Value Hedges | ||||||||||
Aggregate principal amount | $ 200 | $ 200 | ||||||||
Ten Year 2015 senior euro notes | ||||||||||
Fair Value Hedges | ||||||||||
Aggregate principal amount | € | € 575 | |||||||||
Cost of sales | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivative recognized in income | (4.6) | 3.1 | (9.2) | 9.1 | ||||||
Selling, general and administrative expenses | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivative recognized in income | 64.9 | (131.7) | 33.3 | (121.1) | ||||||
Interest expense, net | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivative recognized in income | 6.2 | 14.6 | 19.2 | |||||||
Foreign currency forward contracts. | ||||||||||
Net Investment Hedges | ||||||||||
Notional values | 3,819 | 3,819 | $ 3,702 | |||||||
Foreign currency forward contracts. | Interest expense, net | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivative recognized in income | 4.5 | |||||||||
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) | 3.1 | |||||||||
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 | 22.8 | (30.2) | 28.6 | (12.3) | ||||||
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 | 11.3 | 11.3 | ||||||||
Interest rate swap agreements | ||||||||||
Net Investment Hedges | ||||||||||
Notional values | 750 | 750 | ||||||||
Euro Notes | ||||||||||
Net Investment Hedges | ||||||||||
Revaluation gain (loss), net of tax | 36.7 | (83.4) | 10.3 | (87.4) | ||||||
Cross Currency Interest Rate Contract | ||||||||||
Net Investment Hedges | ||||||||||
Notional values | 354 | 354 | ||||||||
Revaluation gain (loss), net of tax | (1.5) | (1.5) | ||||||||
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) | (4.6) | (9.2) | 9.1 | |||||||
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) | 42.1 | (101.5) | 4.7 | (108.8) | ||||||
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) | (1.8) | (0.7) | ||||||||
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value | 5.1 | (4.9) | 16.4 | 8.6 | ||||||
Gain (loss) recognized in income (ineffective portion) | 5.1 | (4.9) | 16.4 | 8.6 | ||||||
Cash Flow Hedges | Interest rate swap agreements | 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) | (0.6) | $ (0.2) | ||||||||
Fair Value Hedges | Interest rate swap agreements | ||||||||||
Fair Value Hedges | ||||||||||
Derivative liability | 745.9 | 745.9 | ||||||||
Net Investment Hedges | Senior euro notes | ||||||||||
Net Investment Hedges | ||||||||||
Notional values | 1,353 | 1,353 | 1,150 | |||||||
Net Investment Hedges | Cross Currency Interest Rate Contract | ||||||||||
Net Investment Hedges | ||||||||||
Notional values | $ 354 | $ 354 | € 300 | € 300 | ||||||
Discontinued Operations | Derivatives not designated as hedging instruments | Selling, general and administrative expenses | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Gain (loss) on derivatives | $ (2.5) | |||||||||
Subsequent event | Fair Value Hedges | ||||||||||
Impact on AOCI and earnings from derivative contracts | ||||||||||
Interest rate (as a percent) | 2.70% | |||||||||
Fair Value Hedges | ||||||||||
Aggregate principal amount | $ 250 | |||||||||
Interest rate (as a percent) | 2.70% |
OTHER COMPREHENSIVE INCOME (L_3
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Reclassification adjustments | ||||
COS | $ (2,016.7) | $ (1,769.6) | $ (5,572.7) | $ (5,125.5) |
SG&A | (832) | (802.6) | (2,548.2) | (2,499.5) |
Interest (income) expense, net | (76.4) | (134.8) | (173.7) | (241.8) |
Other activity | 0.5 | (0.2) | (0.2) | (0.2) |
Subtotal | (23.3) | 44.9 | 259.1 | 145.1 |
Derivative (gain) loss reclassified from AOCI into income, net of tax | (31.9) | 78.2 | (7.7) | 69.4 |
Pension and postretirement benefits amortization of net actuarial losses | 33.4 | (18.5) | 62.8 | 12 |
Derivative & Hedging Instruments | ||||
Reclassification adjustments | ||||
Amount recognized in AOCI | 61.2 | (126.2) | 30.3 | (108.3) |
Tax impact | (4.4) | 3.8 | (3.3) | 2.6 |
Subtotal | 15.3 | (19.1) | 16.7 | (14.1) |
Derivative & Hedging Instruments | Amount reclassified from AOCI | ||||
Reclassification adjustments | ||||
COS | 4.6 | (3.1) | 9.2 | (9.1) |
SG&A | (42.1) | 101.5 | (4.7) | 108.8 |
Interest (income) expense, net | (4.5) | 5.1 | (14.6) | (7.9) |
Amount reclassified from AOCI into income | (42) | 103.5 | (10.1) | 91.8 |
Pension & Postretirement Benefits | ||||
Reclassification adjustments | ||||
Amount reclassified from AOCI into income | 23.3 | 15 | 231.4 | 44.3 |
Other activity | 15.6 | (29.8) | (2.8) | (21.5) |
Tax impact | (5.5) | (3.7) | (55.9) | (10.8) |
Subtotal | 33.4 | (18.5) | 172.7 | 12 |
Pension & Postretirement Benefits | Amount reclassified from AOCI | ||||
Reclassification adjustments | ||||
Amount reclassified from AOCI into income | 16.3 | $ 15 | 59.8 | $ 44.3 |
Actuarial gain (loss) | ||||
Reclassification adjustments | ||||
Amount recognized in AOCI | 145 | |||
Settlement charge | Amount reclassified from AOCI | ||||
Reclassification adjustments | ||||
Amount reclassified from AOCI into income | $ 7 | $ 26.6 |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) - shares | Jun. 03, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | Feb. 28, 2015 |
Discontinued Operations, Disposed of By Sale | ChampionX | ||||
Shareholder's Equity | ||||
Shares accepted | 4,955,552 | |||
Number of shares exchanged | 122,200,000 | |||
Common Stock | ||||
Shareholder's Equity | ||||
Common stock, shares authorized to be repurchased | 20,000,000 | |||
Reacquired shares (in shares) | 367,141 | 761,245 | ||
Remaining shares authorized to be repurchased | 5,978,499 | |||
Number of shares that have been repurchased through the exercise of stock options and vesting of stock awards | 105,694 | 196,181 | ||
Number of shares reacquired through the open market or private purchases | 261,447 | 565,064 |
EARNINGS ATTRIBUTABLE TO ECOL_3
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Computations of the basic and diluted earnings attributable to Ecolab per share amounts | ||||
Net income from continuing operations attributable to Ecolab | $ 324.5 | $ 246.2 | $ 828.9 | $ 667.1 |
Net loss from discontinued operations, net of tax (Note 4) (d) | (2,172.5) | |||
Net income (loss) attributable to Ecolab | $ 324.5 | $ 246.2 | $ 828.9 | $ (1,505.4) |
Weighted-average common shares outstanding | ||||
Basic (in shares) | 286.4 | 285.4 | 286.1 | 287.5 |
Effect of dilutive stock options and units (in shares) | 2.8 | 3 | 2.9 | 3.3 |
Diluted (in shares) | 289.2 | 288.4 | 289 | 290.8 |
Basic EPS | ||||
Continuing operations | $ 1.13 | $ 0.86 | $ 2.90 | $ 2.32 |
Discontinued operations | (7.56) | |||
Earnings attributable to Ecolab | 1.13 | 0.86 | 2.90 | (5.24) |
Diluted EPS | ||||
Continuing operations | 1.12 | 0.85 | 2.87 | 2.29 |
Discontinued operations | (7.47) | |||
Earnings attributable to Ecolab | $ 1.12 | $ 0.85 | $ 2.87 | $ (5.18) |
Anti-dilutive securities excluded from the computation of diluted EPS | 1 | 1 | 1 | 1 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
INCOME TAXES | ||||
Effective income tax rate (as a percent) | 18.30% | 14.50% | 21.20% | 13.20% |
Excess tax benefits, share-based compensation | $ 9.9 | $ 3.4 | $ 20.7 | $ 49 |
Recognized discrete tax expense (benefit) | 6.3 | (12.4) | 17.5 | (56.8) |
Recognized other discrete tax expense (benefit) | 8 | 8.9 | ||
Tax expense, transfer of intangible assets between affiliates | (0.4) | 23.8 | ||
Net discrete expense (benefit), prior year returns | $ 4 | 6.9 | $ 5.5 | 2.4 |
Recognized discrete tax benefits, release of reserves for uncertain tax positions | $ 2.1 | $ (5.4) |
PENSION AND POSTRETIREMENT PL_3
PENSION AND POSTRETIREMENT PLANS - Information Related to Pension and Postretirement Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Amounts recognized in Consolidated Balance Sheet: | ||||||
Other assets | $ 46.9 | $ 46.9 | $ 33 | |||
Postretirement health care and pension benefits | (996.6) | (996.6) | $ (1,226.2) | |||
Change in Accumulated Other Comprehensive Loss (Income): | ||||||
Other comprehensive loss (income) | (33.4) | $ 18.5 | (172.7) | $ (12) | ||
Discontinued Operations | ||||||
Projected Benefit Obligation | ||||||
Service cost (a) | $ 2.5 | |||||
U.S. Pension | Pension | ||||||
Projected Benefit Obligation | ||||||
Service cost (a) | 11.2 | 16.5 | 32.8 | 51.9 | ||
Interest cost | 13.3 | 17.7 | 38.3 | 52.7 | ||
U.S. Pension | U.S. Postretirement Health Care | ||||||
Projected Benefit Obligation | ||||||
Service cost (a) | 0.2 | 0.3 | 0.6 | 0.9 | ||
Interest cost | 0.7 | 0.8 | 2.1 | 2.9 | ||
International Pension | Pension | ||||||
Projected Benefit Obligation | ||||||
Service cost (a) | 7.9 | 7.9 | 24 | 23.2 | ||
Interest cost | $ 4.4 | $ 5.5 | $ 13.1 | $ 16.1 |
PENSION AND POSTRETIREMENT PL_4
PENSION AND POSTRETIREMENT PLANS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
U.S. Pension | Pension | |||||
Net periodic benefit costs | |||||
Service cost (a) | $ 11.2 | $ 16.5 | $ 32.8 | $ 51.9 | |
Interest cost on benefit obligation | 13.3 | 17.7 | 38.3 | 52.7 | |
Expected return on plan assets | (38) | (38.2) | (115.2) | (114.6) | |
Recognition of net actuarial (gain) loss | 12.1 | 13 | 44.5 | 39 | |
Amortization of prior service benefit | (1.7) | (1.6) | (5.1) | (5.4) | |
Curtailments and settlements (b) | 7 | 26.6 | |||
Total expense (benefit) | 3.9 | 7.4 | 21.9 | 23.6 | |
U.S. Pension | Pension | Non-qualified plan | |||||
Other Pension Plan Information | |||||
Contributions to plan | 10 | ||||
Contributions anticipated to be made during the remainder of 2021 | 5 | 5 | |||
U.S. Pension | U.S. Postretirement Health Care | |||||
Net periodic benefit costs | |||||
Service cost (a) | 0.2 | 0.3 | 0.6 | 0.9 | |
Interest cost on benefit obligation | 0.7 | 0.8 | 2.1 | 2.9 | |
Expected return on plan assets | (0.1) | (0.1) | (0.3) | (0.3) | |
Recognition of net actuarial (gain) loss | 0.2 | (0.1) | 0.6 | ||
Amortization of prior service benefit | (2.9) | (8.4) | |||
Total expense (benefit) | 1 | (2) | 3 | (4.9) | |
Other Pension Plan Information | |||||
Contributions to plan | 8 | ||||
Contributions anticipated to be made during the remainder of 2021 | 3 | 3 | |||
International Pension | Pension | |||||
Net periodic benefit costs | |||||
Service cost (a) | 7.9 | 7.9 | 24 | 23.2 | |
Interest cost on benefit obligation | 4.4 | 5.5 | 13.1 | 16.1 | |
Expected return on plan assets | (16.6) | (15.7) | (51.9) | (46.7) | |
Recognition of net actuarial (gain) loss | 5.8 | 6.6 | 20.3 | 19.2 | |
Amortization of prior service benefit | (0.1) | (0.1) | (0.5) | (0.1) | |
Total expense (benefit) | 1.4 | $ 4.2 | 5 | $ 11.7 | |
Other Pension Plan Information | |||||
Contributions to plan | 33 | ||||
Contributions anticipated to be made during the remainder of 2021 | $ 10 | $ 10 | |||
Discontinued Operations | |||||
Net periodic benefit costs | |||||
Service cost (a) | $ 2.5 |
REVENUES - Operating Lease Reve
REVENUES - Operating Lease Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Operating Lease, Lease Income | |||||
Lease billing suspension | $ 38 | ||||
Operating lease revenue | $ 103.3 | $ 84.9 | $ 306.4 | $ 258.2 |
REVENUES - Principal Activities
REVENUES - Principal Activities (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of revenue | ||||
Net sales | $ 3,320.8 | $ 3,018.6 | $ 9,368.5 | $ 8,724.9 |
U.S. Pension | Geographic concentration | Consolidated net sales | ||||
Disaggregation of revenue | ||||
Percentage of consolidated sales | 52.00% | 52.00% | ||
Product and sold equipment | ||||
Disaggregation of revenue | ||||
Net sales | 2,653.8 | 2,426.4 | $ 7,461.6 | $ 7,017.5 |
Service and lease equipment | ||||
Disaggregation of revenue | ||||
Net sales | 667 | 592.2 | 1,906.9 | 1,707.4 |
Corporate | ||||
Disaggregation of revenue | ||||
Net sales | 36 | 46.9 | 104.1 | 59.2 |
Corporate | North America | ||||
Disaggregation of revenue | ||||
Net sales | 25.7 | 34.8 | 73.4 | 47.1 |
Corporate | Europe | ||||
Disaggregation of revenue | ||||
Net sales | 0.8 | 2.4 | 2.6 | 2.4 |
Corporate | Asia Pacific | ||||
Disaggregation of revenue | ||||
Net sales | 1.5 | 1.4 | 4.2 | 1.4 |
Corporate | Latin America | ||||
Disaggregation of revenue | ||||
Net sales | 6.7 | 6.6 | 19.4 | 6.6 |
Corporate | Greater China | ||||
Disaggregation of revenue | ||||
Net sales | 0.7 | 0.4 | 1.9 | 0.4 |
Corporate | India, Middle East and Africa | ||||
Disaggregation of revenue | ||||
Net sales | 0.6 | 1.3 | ||
Corporate | Middle East and Africa ("MEA") | ||||
Disaggregation of revenue | ||||
Net sales | 2.6 | 1.3 | ||
Corporate | Product and sold equipment | ||||
Disaggregation of revenue | ||||
Net sales | 35.8 | 46.6 | 103.5 | 58.9 |
Corporate | Service and lease equipment | ||||
Disaggregation of revenue | ||||
Net sales | 0.2 | 0.3 | 0.6 | 0.3 |
Global Industrial | ||||
Disaggregation of revenue | ||||
Net sales | 1,603.1 | 1,469.3 | 4,578.6 | 4,326.7 |
Global Industrial | North America | ||||
Disaggregation of revenue | ||||
Net sales | 716.8 | 683.5 | 2,046 | 2,033.1 |
Global Industrial | Europe | ||||
Disaggregation of revenue | ||||
Net sales | 353.3 | 325 | 1,008.5 | 914.8 |
Global Industrial | Asia Pacific | ||||
Disaggregation of revenue | ||||
Net sales | 199.8 | 180.4 | 586.8 | 548.8 |
Global Industrial | Latin America | ||||
Disaggregation of revenue | ||||
Net sales | 141 | 117.5 | 400.5 | 362.5 |
Global Industrial | Greater China | ||||
Disaggregation of revenue | ||||
Net sales | 102.9 | 85.1 | 292.7 | 237.5 |
Global Industrial | India, Middle East and Africa | ||||
Disaggregation of revenue | ||||
Net sales | 89.3 | 77.8 | ||
Global Industrial | Middle East and Africa ("MEA") | ||||
Disaggregation of revenue | ||||
Net sales | 244.1 | 230 | ||
Global Industrial | Product and sold equipment | ||||
Disaggregation of revenue | ||||
Net sales | 1,386 | 1,264.3 | 3,941 | 3,725.8 |
Global Industrial | Service and lease equipment | ||||
Disaggregation of revenue | ||||
Net sales | 217.1 | 205 | 637.6 | 600.9 |
Global Institutional & Specialty | ||||
Disaggregation of revenue | ||||
Net sales | 1,070.6 | 898.4 | 2,904 | 2,678.6 |
Global Institutional & Specialty | North America | ||||
Disaggregation of revenue | ||||
Net sales | 776.4 | 654.1 | 2,133.6 | 1,926.4 |
Global Institutional & Specialty | Europe | ||||
Disaggregation of revenue | ||||
Net sales | 166.3 | 127.1 | 394.5 | 375.7 |
Global Institutional & Specialty | Asia Pacific | ||||
Disaggregation of revenue | ||||
Net sales | 48.4 | 47.6 | 150 | 156.1 |
Global Institutional & Specialty | Latin America | ||||
Disaggregation of revenue | ||||
Net sales | 34.9 | 32.4 | 97.3 | 103 |
Global Institutional & Specialty | Greater China | ||||
Disaggregation of revenue | ||||
Net sales | 32.6 | 26.7 | 98.7 | 82.8 |
Global Institutional & Specialty | India, Middle East and Africa | ||||
Disaggregation of revenue | ||||
Net sales | 12 | 10.5 | ||
Global Institutional & Specialty | Middle East and Africa ("MEA") | ||||
Disaggregation of revenue | ||||
Net sales | 29.9 | 34.6 | ||
Global Institutional & Specialty | Product and sold equipment | ||||
Disaggregation of revenue | ||||
Net sales | 889.9 | 758.7 | 2,397.7 | 2,248.7 |
Global Institutional & Specialty | Service and lease equipment | ||||
Disaggregation of revenue | ||||
Net sales | 180.7 | 139.7 | 506.3 | 429.9 |
Global Healthcare and Life Sciences | ||||
Disaggregation of revenue | ||||
Net sales | 286.9 | 322.3 | 881.4 | 866.4 |
Global Healthcare and Life Sciences | North America | ||||
Disaggregation of revenue | ||||
Net sales | 112.6 | 113.2 | 320 | 325.6 |
Global Healthcare and Life Sciences | Europe | ||||
Disaggregation of revenue | ||||
Net sales | 154.1 | 170.7 | 500.8 | 462.2 |
Global Healthcare and Life Sciences | Asia Pacific | ||||
Disaggregation of revenue | ||||
Net sales | 14.8 | 27.8 | 40.3 | 51.7 |
Global Healthcare and Life Sciences | Latin America | ||||
Disaggregation of revenue | ||||
Net sales | 3.5 | 1.1 | 6.3 | |
Global Healthcare and Life Sciences | Greater China | ||||
Disaggregation of revenue | ||||
Net sales | 1.8 | 1.7 | 4.5 | 5 |
Global Healthcare and Life Sciences | India, Middle East and Africa | ||||
Disaggregation of revenue | ||||
Net sales | 3.6 | 5.4 | ||
Global Healthcare and Life Sciences | Middle East and Africa ("MEA") | ||||
Disaggregation of revenue | ||||
Net sales | 14.7 | 15.6 | ||
Global Healthcare and Life Sciences | Product and sold equipment | ||||
Disaggregation of revenue | ||||
Net sales | 259.4 | 292.3 | 795.4 | 788.1 |
Global Healthcare and Life Sciences | Service and lease equipment | ||||
Disaggregation of revenue | ||||
Net sales | 27.5 | 30 | 86 | 78.3 |
Other | ||||
Disaggregation of revenue | ||||
Net sales | 324.2 | 281.7 | 900.4 | 794 |
Other | North America | ||||
Disaggregation of revenue | ||||
Net sales | 201.3 | 175.7 | 549.8 | 496.6 |
Other | Europe | ||||
Disaggregation of revenue | ||||
Net sales | 70.6 | 59.3 | 191.3 | 164.2 |
Other | Asia Pacific | ||||
Disaggregation of revenue | ||||
Net sales | 17.1 | 14.3 | 54.9 | 45 |
Other | Latin America | ||||
Disaggregation of revenue | ||||
Net sales | 13 | 13.4 | 37.7 | 35.7 |
Other | Greater China | ||||
Disaggregation of revenue | ||||
Net sales | 19.5 | 16.7 | 57.7 | 45 |
Other | India, Middle East and Africa | ||||
Disaggregation of revenue | ||||
Net sales | 2.7 | 2.3 | ||
Other | Middle East and Africa ("MEA") | ||||
Disaggregation of revenue | ||||
Net sales | 9 | 7.5 | ||
Other | Product and sold equipment | ||||
Disaggregation of revenue | ||||
Net sales | 82.7 | 64.5 | 224 | 196 |
Other | Service and lease equipment | ||||
Disaggregation of revenue | ||||
Net sales | $ 241.5 | $ 217.2 | $ 676.4 | $ 598 |
REVENUES - Allowance for Doubtf
REVENUES - Allowance for Doubtful Accounts (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Accounts Receivable and Allowance for Doubtful Accounts | ||
Allowance for doubtful accounts, returns and credits | $ 20.4 | $ 15.3 |
Activity in the allowance for doubtful accounts | ||
Beginning balance | 84.3 | 55.5 |
Bad debt expense | 12.4 | 54.6 |
Write-offs | (23.7) | (25) |
Other | 3.4 | (1.2) |
Ending balance (b) | $ 76.4 | 88.2 |
Accounting Standards Update 2016-13 | Adjustment. | ||
Activity in the allowance for doubtful accounts | ||
Beginning balance | $ 4.3 |
REVENUES - Contract Liability (
REVENUES - Contract Liability (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Change in contract liability | ||
Contract liability as of beginning of the year | $ 80.4 | $ 76.7 |
Revenue recognized in the period from: Amounts included in the contract liability at the beginning of the period | (80.4) | (76.7) |
Increases due to billings excluding amounts recognized as revenue during the period ended | 86.7 | 84 |
Business combinations | 0.6 | |
Contract liability as of end of period | $ 86.7 | $ 84.6 |
OPERATING SEGMENTS (Details)
OPERATING SEGMENTS (Details) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2021segment | Sep. 30, 2021item | Sep. 30, 2020USD ($) | Dec. 31, 2020USD ($) | |
Financial information of reportable segments | |||||||
Number of reportable segments | 3 | 3 | |||||
Net sales | $ 3,320.8 | $ 3,018.6 | $ 9,368.5 | $ 8,724.9 | |||
Operating Income (Loss) | 465.8 | 411.4 | 1,210.9 | 979.6 | |||
Previously Reported | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | $ 11,790.2 | ||||||
Operating Income (Loss) | 1,395.7 | ||||||
Previously Reported | 2020 Reported Valued at 2021 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 11,790.2 | ||||||
Operating Income (Loss) | 1,395.7 | ||||||
Global Industrial | |||||||
Financial information of reportable segments | |||||||
Net sales | 1,603.1 | 1,469.3 | 4,578.6 | 4,326.7 | |||
Global Institutional & Specialty | |||||||
Financial information of reportable segments | |||||||
Net sales | 1,070.6 | 898.4 | 2,904 | 2,678.6 | |||
Global Healthcare and Life Sciences | |||||||
Financial information of reportable segments | |||||||
Net sales | 286.9 | 322.3 | 881.4 | 866.4 | |||
Other | |||||||
Financial information of reportable segments | |||||||
Net sales | 324.2 | 281.7 | 900.4 | 794 | |||
Operating segment | |||||||
Financial information of reportable segments | |||||||
Net sales | 3,349.4 | 3,098.3 | 9,419.4 | 9,001.2 | |||
Operating Income (Loss) | 471.3 | 426.6 | 1,219.2 | 1,022.1 | |||
Operating segment | Previously Reported | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 11,921.9 | ||||||
Operating Income (Loss) | 1,419.5 | ||||||
Operating segment | Previously Reported | 2020 Reported Valued at 2021 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 12,122.3 | ||||||
Operating Income (Loss) | 1,448.5 | ||||||
Operating segment | Adjustment | Fixed Currency Rate Change | |||||||
Financial information of reportable segments | |||||||
Net sales | 200.4 | ||||||
Operating Income (Loss) | 29 | ||||||
Operating segment | Global Industrial | |||||||
Financial information of reportable segments | |||||||
Net sales | 1,620.4 | 1,512.9 | 4,609.7 | 4,476.4 | |||
Operating Income (Loss) | 268.3 | 302.3 | 750.8 | 799.7 | |||
Operating segment | Global Industrial | Previously Reported | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 5,959.9 | ||||||
Operating Income (Loss) | 1,106 | ||||||
Operating segment | Global Industrial | Previously Reported | 2020 Reported Valued at 2021 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 6,048.2 | ||||||
Operating Income (Loss) | 1,123.1 | ||||||
Operating segment | Global Industrial | Adjustment | Fixed Currency Rate Change | |||||||
Financial information of reportable segments | |||||||
Net sales | 92 | ||||||
Operating Income (Loss) | 17.3 | ||||||
Operating segment | Global Industrial | Adjustment | Other | |||||||
Financial information of reportable segments | |||||||
Net sales | (3.7) | ||||||
Operating Income (Loss) | (0.2) | ||||||
Operating segment | Global Institutional & Specialty | |||||||
Financial information of reportable segments | |||||||
Net sales | 1,076.6 | 914.4 | 2,914 | 2,734.6 | |||
Operating Income (Loss) | 196.5 | 83.7 | 398.2 | 229.4 | |||
Operating segment | Global Institutional & Specialty | Previously Reported | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 3,577.2 | ||||||
Operating Income (Loss) | 321.9 | ||||||
Operating segment | Global Institutional & Specialty | Previously Reported | 2020 Reported Valued at 2021 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 3,629 | ||||||
Operating Income (Loss) | 324 | ||||||
Operating segment | Global Institutional & Specialty | Adjustment | Fixed Currency Rate Change | |||||||
Financial information of reportable segments | |||||||
Net sales | 42.5 | ||||||
Operating Income (Loss) | 2.4 | ||||||
Operating segment | Global Institutional & Specialty | Adjustment | Other | |||||||
Financial information of reportable segments | |||||||
Net sales | 9.3 | ||||||
Operating Income (Loss) | (0.3) | ||||||
Operating segment | Global Healthcare and Life Sciences | |||||||
Financial information of reportable segments | |||||||
Net sales | 290.2 | 335.1 | 887.4 | 913.3 | |||
Operating Income (Loss) | 37.3 | 69 | 131.2 | 162 | |||
Operating segment | Global Healthcare and Life Sciences | Previously Reported | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 1,189.1 | ||||||
Operating Income (Loss) | 207.6 | ||||||
Operating segment | Global Healthcare and Life Sciences | Previously Reported | 2020 Reported Valued at 2021 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 1,241.1 | ||||||
Operating Income (Loss) | 218.3 | ||||||
Operating segment | Global Healthcare and Life Sciences | Adjustment | Fixed Currency Rate Change | |||||||
Financial information of reportable segments | |||||||
Net sales | 48.3 | ||||||
Operating Income (Loss) | 10 | ||||||
Operating segment | Global Healthcare and Life Sciences | Adjustment | Other | |||||||
Financial information of reportable segments | |||||||
Net sales | 3.7 | ||||||
Operating Income (Loss) | 0.7 | ||||||
Operating segment | Other | |||||||
Financial information of reportable segments | |||||||
Net sales | 326.3 | 288.7 | 904.2 | 817.4 | |||
Operating Income (Loss) | 59.2 | 45.8 | 143.4 | 88.4 | |||
Operating segment | Other | Previously Reported | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 1,093.3 | ||||||
Operating Income (Loss) | 131.5 | ||||||
Operating segment | Other | Previously Reported | 2020 Reported Valued at 2021 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 1,103.4 | ||||||
Operating Income (Loss) | 132.8 | ||||||
Operating segment | Other | Adjustment | Fixed Currency Rate Change | |||||||
Financial information of reportable segments | |||||||
Net sales | 19.4 | ||||||
Operating Income (Loss) | 1.5 | ||||||
Operating segment | Other | Adjustment | Other | |||||||
Financial information of reportable segments | |||||||
Net sales | (9.3) | ||||||
Operating Income (Loss) | (0.2) | ||||||
Currency Impact | |||||||
Financial information of reportable segments | |||||||
Net sales | (28.6) | (79.7) | (50.9) | (276.3) | |||
Operating Income (Loss) | (5.5) | (15.2) | (8.3) | (42.5) | |||
Currency Impact | Previously Reported | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | (131.7) | ||||||
Operating Income (Loss) | (23.8) | ||||||
Currency Impact | Previously Reported | 2020 Reported Valued at 2021 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | (332.1) | ||||||
Operating Income (Loss) | (52.8) | ||||||
Currency Impact | Adjustment | Fixed Currency Rate Change | |||||||
Financial information of reportable segments | |||||||
Net sales | (200.4) | ||||||
Operating Income (Loss) | (29) | ||||||
Corporate | |||||||
Financial information of reportable segments | |||||||
Net sales | 36 | 46.9 | 104.1 | 59.2 | |||
Operating Income (Loss) | (90) | (74.2) | (204.4) | (257.4) | |||
Corporate | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | $ 35.9 | $ 47.2 | $ 104.1 | $ 59.5 | |||
Corporate | Previously Reported | 2020 Reported Valued at 2020 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 102.4 | ||||||
Operating Income (Loss) | (347.5) | ||||||
Corporate | Previously Reported | 2020 Reported Valued at 2021 Management Rates | |||||||
Financial information of reportable segments | |||||||
Net sales | 100.6 | ||||||
Operating Income (Loss) | (349.7) | ||||||
Corporate | Adjustment | Fixed Currency Rate Change | |||||||
Financial information of reportable segments | |||||||
Net sales | (1.8) | ||||||
Operating Income (Loss) | $ (2.2) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 9 Months Ended |
Sep. 30, 2021item | |
Environmental matters | |
Number of locations for environmental assessments and remediation | 30 |