Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2024 shares | |
Document and Entity Information | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Mar. 31, 2024 |
Document Transition Report | false |
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 | 285,569,775 |
Entity Central Index Key | 0000031462 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2024 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
COMMON STOCK | |
Document and Entity Information | |
Title of 12(b) Security | Common Stock, $1.00 par value |
Trading Symbol | ECL |
Security Exchange Name | NYSE |
2.625% Euro Notes due 2025 | |
Document and Entity Information | |
Title of 12(b) Security | 2.625% Euro Notes due 2025 |
Trading Symbol | ECL 25 |
Security Exchange Name | NYSE |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Net sales | $ 3,751.9 | $ 3,571.6 |
Cost of sales (including special charges (a)) | 2,128.1 | 2,205.2 |
Selling, general and administrative expenses | 1,077.7 | 990.3 |
Special (gains) and charges | 28.2 | 24.5 |
Operating income | 517.9 | 351.6 |
Other (income) expense | (12.6) | (13.1) |
Interest expense, net | 71.6 | 74.2 |
Income before income taxes | 458.9 | 290.5 |
Provision for income taxes | 42.3 | 52.4 |
Net income including noncontrolling interest | 416.6 | 238.1 |
Net income attributable to noncontrolling interest | 4.5 | 4.7 |
Net income attributable to Ecolab | $ 412.1 | $ 233.4 |
Earnings attributable to Ecolab per common share | ||
Basic (in dollars per share) | $ 1.44 | $ 0.82 |
Diluted (in dollars per share) | $ 1.43 | $ 0.82 |
Weighted-average common shares outstanding | ||
Basic (in shares) | 285.7 | 284.6 |
Diluted (in shares) | 287.8 | 285.9 |
Product and equipment sales | ||
Net sales | $ 2,986.5 | $ 2,876.3 |
Cost of sales (including special charges (a)) | 1,679.2 | 1,798.3 |
Service and lease sales | ||
Net sales | 765.4 | 695.3 |
Cost of sales (including special charges (a)) | $ 448.9 | $ 406.9 |
CONSOLIDATED STATEMENTS OF IN_2
CONSOLIDATED STATEMENTS OF INCOME (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Special (gains) and charges | $ 28.2 | $ 24.5 |
Cost of sales | ||
Special (gains) and charges | 1.6 | 3.2 |
Product and equipment, and service and lease | Cost of sales | ||
Special (gains) and charges | $ 1.6 | $ 3.2 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||
Net income including noncontrolling interest | $ 416.6 | $ 238.1 |
Foreign currency translation adjustments | ||
Foreign currency translation | (46.6) | 11.1 |
Gain (loss) on net investment hedges | 8.9 | (16.7) |
Total foreign currency translation adjustments | (37.7) | (5.6) |
Derivatives and hedging instruments | 5.1 | (4.7) |
Pension and postretirement benefits | ||
Pension and postretirement benefits | 2.3 | 0.2 |
Subtotal | (30.3) | (10.1) |
Total comprehensive income, including noncontrolling interest | 386.3 | 228 |
Comprehensive income attributable to noncontrolling interest | 5 | 5.2 |
Comprehensive income attributable to Ecolab | $ 381.3 | $ 222.8 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets | ||
Cash and cash equivalents | $ 479.9 | $ 919.5 |
Accounts receivable, net | 2,786.6 | 2,834.2 |
Inventories | 1,565.9 | 1,497.2 |
Other current assets | 379.3 | 393.2 |
Total current assets | 5,211.7 | 5,644.1 |
Property, plant and equipment, net | 3,451.1 | 3,474.6 |
Goodwill | 8,111.4 | 8,148.2 |
Other intangible assets, net | 3,413.6 | 3,493.5 |
Operating lease assets | 566.3 | 553.5 |
Other assets | 544.4 | 532.7 |
Total assets | 21,298.5 | 21,846.6 |
Current liabilities | ||
Short-term debt | 11.3 | 630.4 |
Accounts payable | 1,607.1 | 1,566.3 |
Compensation and benefits | 527 | 655.5 |
Income taxes | 201.6 | 158.7 |
Other current liabilities | 1,354.1 | 1,334.9 |
Total current liabilities | 3,701.1 | 4,345.8 |
Long-term debt | 7,528.6 | 7,551.4 |
Pension and postretirement benefits | 640.4 | 651.7 |
Deferred income taxes | 352 | 418.2 |
Operating lease liabilities | 434 | 425.5 |
Other liabilities | 416.8 | 381.8 |
Total liabilities | 13,072.9 | 13,774.4 |
Commitments and contingencies (Note 16) | ||
Equity (a) | ||
Common stock | 366.8 | 365.7 |
Additional paid-in capital | 6,917.6 | 6,766.7 |
Retained earnings | 10,324.5 | 10,075.4 |
Accumulated other comprehensive loss | (1,881.2) | (1,850.4) |
Treasury stock | (7,522.1) | (7,312.7) |
Total Ecolab shareholders' equity | 8,205.6 | 8,044.7 |
Noncontrolling interest | 20 | 27.5 |
Total equity | 8,225.6 | 8,072.2 |
Total liabilities and equity | $ 21,298.5 | $ 21,846.6 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, shares authorized | 800 | 800 |
Common stock, par value per share (in dollars per share) | $ 1 | $ 1 |
Common stock, shares outstanding | 285.6 | 285.4 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
OPERATING ACTIVITIES | ||
Net income including noncontrolling interest | $ 416.6 | $ 238.1 |
Adjustments to reconcile net income to cash provided by operating activities: | ||
Depreciation | 157 | 158.7 |
Amortization | 77.8 | 75.6 |
Deferred income taxes | (74.4) | (18) |
Share-based compensation expense | 47 | 31.4 |
Pension and postretirement plan contributions | (15.3) | (14.6) |
Pension and postretirement plan (income) expense, net | 4 | 2.6 |
Restructuring charges, net of cash paid | 0.2 | (27.3) |
Other, net | 1.5 | 2.3 |
Changes in operating assets and liabilities, net of effect of acquisitions: | ||
Accounts receivable | 49 | 41 |
Inventories | (65.5) | 70.6 |
Other assets | 21.3 | 3.5 |
Accounts payable | 82.7 | (268.5) |
Other liabilities | (52.5) | (97.2) |
Cash provided by operating activities | 649.4 | 198.2 |
INVESTING ACTIVITIES | ||
Capital expenditures | (201.5) | (173.7) |
Property and other assets sold | 0.7 | 4.8 |
Other, net | (0.2) | (20.5) |
Cash used for investing activities | (201) | (189.4) |
FINANCING ACTIVITIES | ||
Net issuances of commercial paper and notes payable | 7.2 | 5.5 |
Long-term debt repayments | (629.6) | |
Reacquired shares | (196.4) | (10.6) |
Dividends paid | (175.2) | (157.7) |
Exercise of employee stock options | 105.5 | 15.5 |
Hedge settlements | (18.4) | |
Other, net | (0.8) | (0.7) |
Cash used for financing activities | (889.3) | (166.4) |
Effect of exchange rate changes on cash and cash equivalents | 1.3 | (21.6) |
Decrease in cash and cash equivalents | (439.6) | (179.2) |
Cash and cash equivalents, beginning of period | 919.5 | 598.6 |
Cash and cash equivalents, end of period | $ 479.9 | $ 419.4 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Millions, $ in Millions | Ecolab Shareholders' Equity | Common stock | Additional Paid-in Capital | Retained Earnings | AOCI (Loss) | Treasury Stock | Non-Controlling Interest | Total |
Balance, beginning at Dec. 31, 2022 | $ 7,236.1 | $ 364.7 | $ 6,580.2 | $ 9,318.8 | $ (1,726.6) | $ (7,301) | $ 22.5 | $ 7,258.6 |
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income | 233.4 | 233.4 | 4.7 | 238.1 | ||||
Other comprehensive income (loss) | (10.6) | (10.6) | 0.5 | (10.1) | ||||
Cash dividends declared (a) | (150.9) | (150.9) | (6.9) | (157.8) | ||||
Stock options and awards | 46.8 | 0.3 | 46.3 | 0.2 | 46.8 | |||
Reacquired shares | (10.6) | (10.6) | (10.6) | |||||
Balance, Ending at Mar. 31, 2023 | 7,344.2 | 365 | 6,626.5 | 9,401.3 | (1,737.2) | (7,311.4) | 20.8 | 7,365 |
Balance, beginning at Dec. 31, 2023 | 8,044.7 | 365.7 | 6,766.7 | 10,075.4 | (1,850.4) | (7,312.7) | 27.5 | $ 8,072.2 |
Balance, beginning (in shares) at Dec. 31, 2023 | 285.4 | |||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Net income | 412.1 | 412.1 | 4.5 | $ 416.6 | ||||
Other comprehensive income (loss) | (30.8) | (30.8) | 0.5 | (30.3) | ||||
Cash dividends declared (a) | (163) | (163) | (12.5) | (175.5) | ||||
Stock options and awards | 152.6 | 1.1 | 150.9 | 0.6 | 152.6 | |||
Reacquired shares | (210) | (210) | (210) | |||||
Balance, Ending at Mar. 31, 2024 | $ 8,205.6 | $ 366.8 | $ 6,917.6 | $ 10,324.5 | $ (1,881.2) | $ (7,522.1) | $ 20 | $ 8,225.6 |
Balance, Ending (in shares) at Mar. 31, 2024 | 285.6 |
CONSOLIDATED STATEMENTS OF EQ_2
CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
CONSOLIDATED STATEMENTS OF EQUITY | ||
Dividends declared per common share (in dollars per share) | $ 0.57 | $ 0.53 |
CONSOLIDATED FINANCIAL INFORMAT
CONSOLIDATED FINANCIAL INFORMATION | 3 Months Ended |
Mar. 31, 2024 | |
CONSOLIDATED FINANCIAL INFORMATION | |
CONSOLIDATED FINANCIAL INFORMATION | 1. CONSOLIDATED FINANCIAL INFORMATION The unaudited consolidated financial information for the first quarter ended March 31, 2024 and 2023 reflects, in the opinion of management, all adjustments necessary for a fair statement of the financial position, results of operations, comprehensive income, equity and cash flows of Ecolab Inc. ("Ecolab" or "the Company") for the interim periods presented. Any adjustments consist of normal recurring items. The financial results for any interim period are not necessarily indicative of results for the full year. The consolidated balance sheet data as of December 31, 2023 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, 2023 filed with the Securities and Exchange Commission (“SEC”) on February 23, 2024. With respect to the unaudited financial information of the Company for the first quarter ended March 31, 2024 and 2023 included in this Form 10-Q, PricewaterhouseCoopers LLP reported that they have applied limited procedures in accordance with professional standards for a review of such information. Their separate report dated May 2, 2024 appearing herein states that they did not audit and they do not express an opinion on that unaudited financial information. Accordingly, the degree of reliance on their report on such information should be restricted in light of the limited nature of the review procedures applied. PricewaterhouseCoopers LLP is not subject to the liability provisions of Section 11 of the Securities Act of 1933, as amended (the "Act"), for their report on the unaudited financial information because that report is not a "report" or a "part" of a registration statement prepared or certified by PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11 of the Act. |
SPECIAL (GAINS) AND CHARGES
SPECIAL (GAINS) AND CHARGES | 3 Months Ended |
Mar. 31, 2024 | |
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: First Quarter Ended March 31 (millions) 2024 2023 Cost of sales Restructuring activities $1.6 $3.2 Cost of sales subtotal 1.6 3.2 Special (gains) and charges Restructuring activities 18.1 12.6 Acquisition and integration activities 2.5 5.0 Other 7.6 6.9 Special (gains) and charges subtotal 28.2 24.5 Total special (gains) and charges $29.8 $27.7 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 Combined Program which is described below. These activities have been included as a component of 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. Combined Program In November 2022 the Company approved a Europe cost savings program. In connection with these actions, the Company expected to incur pre-tax charges of $130 million ( $110 million after tax). In February 2023, the Company expanded its previously announced Europe cost savings program to focus on its Institutional and Healthcare businesses in other regions. In connection with the expanded program (“Combined Program”), the Company expects to incur total pre-tax charges of $195 million ( $150 million after tax). The Company expects that these restructuring charges will be substantially completed by the end of 2024. Program actions include headcount reductions from terminations, not filling certain open positions, and facility closures. The Combined Program charges are expected to be primarily cash expenditures related to severance and asset disposals. In anticipation of this Combined Program, a limited number of actions were taken in the fourth quarter of 2022. As a result, the Company reclassified $19.3 million ( $14.5 million after tax) from other restructuring to the Combined Program in the first quarter of 2023. During the first quarter of 2024 and 2023, the Company recorded restructuring charges of $19.7 million ( $15.8 million after tax) and $13.4 million ( $10.2 million after tax), respectively, primarily related to severance and professional services . The Company has recorded $183.9 million ( $152.7 million after tax) of cumulative charges under the Combined Plan. The net liability related to the Combined Program was $44.1 million and $43.1 million as of March 31, 2024 and December 31, 2023, 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. Restructuring activity related to the Combined Program since inception of the underlying actions includes the following items: Employee Asset (millions) Costs Disposals Other Total 2022-2023 Activity Recorded expense and accrual $114.2 $14.0 $16.7 $144.9 Net cash payments (90.4) - (16.7) (107.1) Non-cash charges - (14.0) - (14.0) Reclassification 19.3 - - 19.3 Net restructuring liability, December 31, 2023 43.1 - - 43.1 2024 Activity Recorded expense and accrual 2.3 0.4 17.0 19.7 Net cash payments (15.9) - (2.4) (18.3) Non-cash charges - (0.4) - (0.4) Net restructuring liability, March 31, 2024 $29.5 $- $14.6 $44.1 Acquisition and integration related costs Acquisition and integration related costs reported in special (gains) and charges on the Consolidated Statements of Income include $2.5 million ( $1.9 million after tax) and $5.0 million ( $3.7 million after tax) during the first quarter of 2024 and 2023, respectively. Further information related to the Company’s acquisitions is included in Note 3. Other operating activities Other special charges of $7.6 million ( $5.4 million after tax) and $6.9 million ( $5.4 million after tax) recorded in the first quarter of 2024 and 2023, respectively , which are recorded in special (gains) and charges on the Consolidated Statements of Income. |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended |
Mar. 31, 2024 | |
ACQUISITIONS | |
ACQUISITIONS | 3. ACQUISITIONS 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 based on estimates of the fair value of assets acquired, liabilities assumed and noncontrolling interests acquired as of the acquisition date. Goodwill is recognized in the amount that the purchase consideration paid exceeds the fair value of the net assets acquired. Purchase consideration includes both cash paid and the fair value of noncash consideration exchanged, including stock and/or contingent consideration, and is reduced by the amount of cash or cash equivalents acquired. No acquisitions occurred during the first quarter of 2024 or 2023. |
BALANCE SHEET INFORMATION
BALANCE SHEET INFORMATION | 3 Months Ended |
Mar. 31, 2024 | |
BALANCE SHEET INFORMATION | |
BALANCE SHEET INFORMATION | 4. BALANCE SHEETS INFORMATION March 31 December 31 (millions) 2024 2023 Accounts receivable, net Accounts receivable $2,939.1 $2,983.2 Allowance for expected credit losses and other accruals (152.5) (149.0) Total $2,786.6 $2,834.2 Inventories Finished goods $970.2 $911.4 Raw materials and parts 702.4 704.7 Inventories at FIFO cost 1,672.6 1,616.1 FIFO cost to LIFO cost difference (106.7) (118.9) Total $1,565.9 $1,497.2 Other current assets Prepaid assets $153.5 $143.9 Taxes receivable 169.3 186.9 Derivative assets 7.2 3.3 Other 49.3 59.1 Total $379.3 $393.2 Property, plant and equipment, net Land $154.9 $155.6 Buildings and leasehold improvements 1,178.8 1,171.0 Machinery and equipment 2,146.7 2,113.8 Merchandising and customer equipment 2,817.7 2,758.4 Capitalized software 1,006.4 985.9 Construction in progress 454.1 470.1 7,758.6 7,654.8 Accumulated depreciation (4,307.5) (4,180.2) Total $3,451.1 $3,474.6 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 3,374.8 3,385.1 Patents 505.2 503.6 Trademarks 404.4 406.5 Other technologies 551.0 551.2 4,835.4 4,846.4 Accumulated amortization Customer relationships (1,850.9) (1,805.0) Patents (326.3) (319.4) Trademarks (244.6) (238.0) Other technologies (230.0) (220.5) (2,651.8) (2,582.9) Net intangible assets subject to amortization 2,183.6 2,263.5 Total $3,413.6 $3,493.5 Other assets Deferred income taxes $122.0 $119.3 Pension 120.8 118.4 Derivative asset 26.5 23.6 Other 275.1 271.4 Total $544.4 $532.7 March 31 December 31 (millions) 2024 2023 Other current liabilities Discounts and rebates $442.1 $438.8 Dividends payable 163.0 162.7 Interest payable 64.6 68.5 Taxes payable, other than income 143.8 153.2 Derivative liability 1.2 3.7 Restructuring 48.8 48.9 Contract liability 118.0 110.9 Operating lease liabilities 130.1 126.1 Other 242.5 222.1 Total $1,354.1 $1,334.9 Accumulated other comprehensive income (loss) Unrealized gain (loss) on derivative financial instruments, net of tax $1.0 ($4.1) Unrecognized pension and postretirement benefit expense, net of tax (532.4) (534.7) Cumulative translation, net of tax (1,349.8) (1,311.6) Total ($1,881.2) ($1,850.4) |
DEBT AND INTEREST
DEBT AND INTEREST | 3 Months Ended |
Mar. 31, 2024 | |
DEBT AND INTEREST | |
DEBT AND INTEREST | 5. DEBT AND INTEREST Short-term Debt The following table provides the components of the Company’s short-term debt obligations as of March 31, 2024 and December 31, 2023. March 31 December 31 (millions) 2024 2023 Short-term debt Notes payable $8.9 $1.8 Long-term debt, current maturities 2.4 628.6 Total $11.3 $630.4 Lines of Credit As of March 31, 2024, the Company has a $2.0 billion multi-year revolving 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 March 31, 2024 or December 31, 2023. Commercial Paper The Company’s commercial paper program is used as a potential 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. and Euro commercial paper programs as of March 31, 2024 or December 31, 2023. 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 March 31, 2024 and December 31, 2023, the Company had $8.9 million and $1.8 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 March 31, 2024 and December 31, 2023. Maturity March 31 December 31 (millions) by Year 2024 2023 Long-term debt Public notes (2024 principal amount) Seven year 2016 senior notes ( €575 million) 2024 $- $625.9 Ten year 2015 senior notes ( €575 million) 2025 620.4 625.1 Ten year 2016 senior notes ( $750 million) 2026 728.8 728.2 Ten year 2017 senior notes ( $500 million) 2027 447.7 448.3 Six Year 2021 senior notes ( $500 million) 2027 497.6 497.4 Five Year 2022 senior notes ( $500 million) 2028 494.5 494.2 Ten year 2020 senior notes ( $698 million) 2030 647.7 662.7 Ten year 2020 senior notes ( $600 million) 2031 556.1 561.0 Eleven year 2021 senior notes ( $650 million) 2032 645.3 645.2 Thirty year 2011 senior notes ( $389 million) 2041 384.8 384.7 Thirty year 2016 senior notes ( $200 million) 2046 197.4 197.4 Thirty year 2017 senior notes ( $484 million) 2047 427.2 426.8 Thirty year 2020 senior notes ( $500 million) 2050 491.2 491.1 Thirty year 2021 senior notes ( $850 million) 2051 839.4 839.3 Thirty-four year 2021 senior notes ( $685 million) 2055 539.7 539.2 Finance lease obligations and other 13.2 13.5 Total debt 7,531.0 8,180.0 Long-term debt, current maturities (2.4) (628.6) Total long-term debt $7,528.6 $7,551.4 Public Notes The Company’s public notes may be redeemed by the Company at its option at redemption prices that include accrued and unpaid interest and a make-whole premium. Upon the occurrence of a change of control accompanied by a downgrade of the public notes below investment grade rating, within a specified time period, the Company would be required to offer to repurchase the public notes at a price equal to 101% of the aggregate principal amount thereof, plus any accrued and unpaid interest to the date of repurchase. The public notes are senior unsecured and unsubordinated obligations of the Company and rank equally with all other senior and unsubordinated indebtedness of the Company. Covenants The Company is in compliance with all covenants under the Company’s outstanding indebtedness as of March 31, 2024. Net Interest Expense Interest expense and interest income recognized during the first quarter of 2024 and 2023 were as follows: First Quarter Ended March 31 (millions) 2024 2023 Interest expense $94.5 $80.1 Interest income (22.9) (5.9) Interest expense, net $71.6 $74.2 Interest expense generally includes the expense associated with the interest on the Company’s outstanding borrowings, including the impact of the Company’s interest rate swap agreements. Interest expense also includes the amortization of debt issuance costs and debt discounts, which are both recognized over the term of the related debt. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2024 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
GOODWILL AND OTHER INTANGIBLE ASSETS | 6. GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill Goodwill arises from the Company’s acquisitions and represents the excess of the fair value of the purchase consideration exchanged over the fair value of net assets acquired. The Company’s reporting units are its eight 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. 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 first quarter ended March 31, 2024 were as follows: Global Global Global Global Institutional Healthcare & Pest (millions) Industrial & Specialty Life Sciences Elimination Other Total December 31, 2023 $4,140.6 $610.0 $3,158.4 $- $239.2 $8,148.2 Segment changes (a) 102.9 - - 136.3 (239.2) - December 31, 2023 recast 4,243.5 610.0 3,158.4 136.3 - 8,148.2 Effect of foreign currency translation (26.0) (0.8) (9.8) (0.2) - (36.8) March 31, 2024 $4,217.5 $609.2 $3,148.6 $136.1 $- $8,111.4 (a) Relates to reclassifications made to reportable segments in the current year. Effective January 1, 2024, the Company’s former Textile Care and Colloidal Technologies Group (“CTG”) operating segments are now part of the Water operating segment which continues to remain in the Global Industrial reportable segment. Additionally, the Pest Elimination operating segment, formerly aggregated with the Textile Care and CTG operating segments within Other, is now reported as the stand-alone Global Pest Elimination reportable segment. After these changes, the Company has eight operating segments aligned with eight reporting units. Refer to Note 15 for further information. 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. Based on the ongoing performance of the Company’s reporting units associated with the Nalco trade name, an interim indefinite life intangible asset impairment assessment was not performed during the first quarter of 2024. 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 technologies 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 first quarter of 2024 and 2023 was $77.8 million and $75.6 million, respectively. Amortization expense related to intangible assets for the remaining nine-month period of 2024 is expected to be approximately $224 million. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2024 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | 7. FAIR VALUE MEASUREMENTS The Company’s financial instruments include cash and cash equivalents, 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: March 31, 2024 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $21.6 $- $21.6 $- Cross-currency swap derivative contracts 33.1 - 33.1 - Liabilities Foreign currency forward contracts 15.6 - 15.6 - Interest rate swap agreements 167.6 - 167.6 - Cross-currency swap derivative contracts 22.1 - 22.1 - December 31, 2023 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $26.6 $- $26.6 $- Cross-currency swap derivative contracts 29.1 - 29.1 - Liabilities Foreign currency forward contracts 27.0 - 27.0 - Interest rate swap agreements 146.5 - 146.5 - Cross-currency swap derivative contracts 24.9 - 24.9 - 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 classified within Level 2. The carrying value of interest rate swap agreements is at fair value, which is determined based on current forward interest rates as of the balance sheet date and are classified within Level 2. The cross-currency swap derivative contracts are 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 and the U.S. dollar and CNH (CNH is the Chinese Yuan traded in the offshore market). The carrying value of the cross-currency swap derivative contracts 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 are 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 is within Note 8. 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, 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, which includes adjustments related to the impact of interest rate swap agreements, premiums and discounts, and deferred debt issuance costs, and the estimated fair value of long-term debt, including current maturities, held by the Company were: March 31, 2024 December 31, 2023 Carrying Fair Carrying Fair Amount Value Amount Value Long-term debt, including current maturities $7,531.0 $6,765.9 $8,180.0 $7,552.5 |
DERIVATIVES AND HEDGING TRANSAC
DERIVATIVES AND HEDGING TRANSACTIONS | 3 Months Ended |
Mar. 31, 2024 | |
DERIVATIVES AND HEDGING TRANSACTIONS | |
DERIVATIVES AND HEDGING TRANSACTIONS | 8. DERIVATIVES AND HEDGING TRANSACTIONS The Company uses foreign currency forward contracts, interest rate swap agreements, cross-currency swap derivative 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 Consolidated Statements 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 March 31 December 31 March 31 December 31 (millions) 2024 2023 2024 2023 Derivatives designated as hedging instruments Foreign currency forward contracts $8.6 $6.7 $2.2 $5.2 Interest rate swap agreements - - 167.6 146.5 Cross-currency swap derivative contracts 33.1 29.1 22.1 24.9 Derivatives not designated as hedging instruments Foreign currency forward contracts 13.0 19.9 13.4 21.8 Gross value of derivatives 54.7 55.7 205.3 198.4 Gross amounts offset in the Consolidated Balance Sheets (21.0) (28.8) (21.0) (28.8) Net value of derivatives $33.7 $26.9 $184.3 $169.6 The following table summarizes the notional values of the Company’s outstanding derivatives: Notional Values March 31 December 31 (millions) 2024 2023 Foreign currency forward contracts $2,978 $3,745 Interest rate swap agreements 1,500 1,500 Cross-currency swap derivative contracts 976 998 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, intercompany loans, 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 (loss) (“AOCI”) until the hedged items affect earnings, at which time the gain or loss is reclassified into the same line item in the Consolidated Statements of Income as the underlying exposure being hedged. Cash flow hedged transactions impacting AOCI are forecasted to occur within the next year . 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 in 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 mark-to-market monthly and recognized in the same line item in 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 in 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 recorded as gains or losses in interest (income) expense and is offset by the gain or loss of the underlying debt instrument, which also is recorded in interest (income) expense. These fair value hedges are highly effective and thus, there is no impact on earnings due to hedge ineffectiveness. In aggregate, the Company has entered into a series of interest rate swap agreements to convert $1.5 billion of its debt from a fixed interest rate to a floating interest rate. The fixed interest rates range from 1.3% to 4.8% and mature between 2026 and 2031. These interest rate swap agreements are designated as fair value hedges. 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 First Quarter Ended First Quarter Ended Line item in which the hedged item is included March 31 March 31 (millions) 2024 2023 2024 2023 Long-term debt $1,333.6 $1,348.9 ($168.7) ($153.4) Net Investment Hedges The Company designates its outstanding €575 million ( $621 million at the end of the first quarter of 2024) senior notes (“Euronotes”) and related accrued interest as a hedge of its Euro denominated exposures from the Company’s investments in certain of its Euro denominated functional currency subsidiaries. The Company entered into a series of Euro cross-currency swap derivative contracts maturing in 2026 and 2030. These cross-currency swap derivative contracts are designated as net investment hedge of the Company’s Euro denominated exposures from the Company’s investments in certain of its Euro denominated functional currency subsidiaries. The cross-currency swap derivative contracts exchange fixed-rate payments in one currency for fixed-rate payments in another currency. As of March 31, 2024, the Company had €625 million ( $674 million) cross-currency swap derivative contracts 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 AOCI in stockholders’ equity, partially offsetting the foreign currency translation adjustment of the Company’s related net investment that is also recorded in AOCI. Any ineffective portions of net investment hedges are reclassified from AOCI 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. During 2023, the Company entered into CNH cross-currency swap derivative contracts with a notional amount of CNH 1,094 million and CNH 1,098 million, respectively, both maturing in 2032. The cross-currency swap derivative contracts are designated as net investment hedges of its Chinese Yuan (“CNY”) denominated exposures from the Company’s investments in certain CNY denominated functional currency subsidiaries. The cross-currency swap derivative contracts exchange fixed-rate payments in USD for fixed-rate payments in CNH. As of March 31, 2024, the Company had in aggregate, CNH 2,192 million ( $302 million) cross-currency swap derivative contracts 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 AOCI in stockholders’ equity, partially offsetting the foreign currency translation adjustment of the Company’s related net investment that is also recorded in AOCI. The interest income or expense from these swaps is 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 contracts, which are designated and effective as hedges of the Company’s net investments, have been included as a component of the cumulative translation adjustment account, and were as follows: First Quarter Ended March 31 (millions) 2024 2023 Revaluation gain (loss), net of tax: Euronotes $2.5 ($15.1) Cross-currency swap derivative contracts 6.4 (1.6) Total revaluation gain (loss), net of tax $8.9 ($16.7) 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: First Quarter Ended March 31 2024 2023 (millions) COS SG&A Interest COS SG&A Interest Gain (loss) on derivatives designated as hedging instruments: Foreign currency forward contracts Amount of gain (loss) reclassified from AOCI to income $- $0.7 $- $5.3 ($6.0) $- Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value - - - - - 2.0 Interest rate swap agreements Amount of (loss) gain reclassified from AOCI to income - - (0.5) - - (0.5) Gain (loss) on derivatives not designated as hedging instruments: Foreign currency forward contracts Amount of gain (loss) recognized in income - 0.4 - - (24.6) - Total gain (loss) of all derivative instruments $- $1.1 ($0.5) $5.3 ($30.6) $1.5 |
OTHER COMPREHENSIVE INCOME (LOS
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | 3 Months Ended |
Mar. 31, 2024 | |
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | |
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | 9. 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. Refer to Note 8 for additional information related to the Company’s derivatives and hedging transactions. Refer to Note 13 for additional information related to the Company’s pension and postretirement benefits activity. The following tables provide other comprehensive income information related to the Company’s derivatives and hedging instruments and pension and postretirement benefits: First Quarter Ended March 31 (millions) 2024 2023 Derivative and Hedging Instruments Unrealized gain (loss) on derivative and hedging instruments Amount recognized in AOCI $6.6 ($5.1) (Gain) loss reclassified from AOCI into income COS - (5.3) SG&A (0.7) 6.0 Interest (income) expense, net 0.5 (1.5) (0.2) (0.8) Other activity - 0.1 Tax impact (1.3) 1.1 Net of tax $5.1 ($4.7) Pension and Postretirement Benefits Amount reclassified from AOCI into income Settlement charge $0.4 $0.6 Amortization of losses and prior period service credits, net 1.7 1.6 2.1 2.2 Other activity 0.9 (1.6) Tax impact (0.7) (0.4) Net of tax $2.3 $0.2 The following table summarizes the derivative and pension and postretirement benefit amounts reclassified from AOCI into income: First Quarter Ended March 31 2024 2023 (millions) Derivative (gain) loss reclassified from AOCI into income, net of tax ($0.1) ($0.6) Pension and postretirement benefits amortization of losses and prior period service credits, net and settlement charge, reclassified from AOCI into income, net of tax 2.3 0.2 |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2024 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | 10. SHAREHOLDERS’ EQUITY Share Repurchase Authorization In February 2015 and November 2022, the Company’s Board of Directors authorized the repurchase of up to 20,000,000 and 10,000,000 , respectively, additional shares of its common stock, including shares to be repurchased under Rule 10b5–1. As of March 31, 2024, 12,083,711 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 first quarter of 2024, the Company reacquired 921,618 shares of its common stock, of which 833,386 related to share repurchases through open market and 88,232 related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units. During the first quarter of 2023, the Company reacquired 66,862 shares of its common stock related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units. |
EARNINGS ATTRIBUTABLE TO ECOLAB
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") | 3 Months Ended |
Mar. 31, 2024 | |
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") | |
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") | 11. 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: First Quarter Ended March 31 (millions, except per share) 2024 2023 Net income attributable to Ecolab $412.1 $233.4 Weighted-average common shares outstanding Basic 285.7 284.6 Effect of dilutive stock options and units 2.1 1.3 Diluted 287.8 285.9 Earnings attributable to Ecolab per common share Basic EPS $1.44 $0.82 Diluted EPS $1.43 $0.82 Anti-dilutive securities excluded from the computation of diluted EPS 2.4 4.6 Amounts do not necessarily sum due to rounding. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2024 | |
INCOME TAXES | |
INCOME TAXES | 12. INCOME TAXES The Company’s tax rate was 9.2% and 18.0% for the first quarter of 2024 and 2023, respectively. The change in the Company’s tax rate for the first quarter of 2024 compared to the first quarter of 2023 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 $48.2 million in the first quarter of 2024. This included a tax benefit of $41.9 million associated with transferring certain intangible property between affiliates and $8.6 million associated with share-based compensation excess tax benefits. The remaining net expense of $2.3 million is from other income tax adjustments including the impact of changes in tax laws, audit settlements, and other changes in estimates. The Company recognized net tax benefits related to discrete tax items of $4.0 million in the first quarter of 2023 primarily due to changes in uncertain tax positions, prior year return adjustments, repricing of deferred tax balances, and other changes in estimates. The Organization for Economic Co-operation’s (“OECD”) global minimum tax regime (“Pillar Two”) became effective in certain countries where the Company operates starting in 2024. As such, an estimate of Pillar Two tax has been considered within the provision for income taxes. The Company continues to monitor these legislative developments, but based on information available does not anticipate material impacts to the 2024 financial statements. |
PENSION AND POSTRETIREMENT PLAN
PENSION AND POSTRETIREMENT PLANS | 3 Months Ended |
Mar. 31, 2024 | |
PENSION AND POSTRETIREMENT PLANS | |
PENSION AND POSTRETIREMENT PLANS | 13. PENSION AND POSTRETIREMENT PLANS The Company has a non-contributory, qualified, defined benefit pension plan covering the majority of its U.S. employees. The Company also has non-contributory, non-qualified, defined benefit pension plans, which provide for benefits to employees in excess of limits permitted under its U.S. pension plans. Various international subsidiaries also have defined benefit pension plans. The Company also provides postretirement health care and life insurance benefits to certain U.S. employees and retirees. The components of net periodic pension and postretirement health care benefit expense for the first quarter ended March 31 are as follows: U.S. International U.S. Postretirement Pensions Pensions Benefits (millions) 2024 2023 2024 2023 2024 2023 Service cost $11.6 $10.2 $4.9 $5.4 $0.1 $0.1 Interest cost on benefit obligation 21.8 22.0 12.4 11.4 1.3 1.4 Expected return on plan assets (37.7) (36.3) (12.5) (13.8) - - Recognition of net actuarial loss (gain) 1.5 - 2.2 3.5 (0.8) (0.8) Amortization of prior service benefit (1.1) (1.0) (0.1) (0.1) - - Curtailments and settlements 0.4 0.7 - - - (0.1) Total expense (benefit) ($3.5) ($4.4) $6.9 $6.4 $0.6 $0.6 Service cost is included as employee compensation cost in either cost of sales or selling, general and administrative expenses on the Consolidated Statements of Income based on employee roles, while non-service components are included in other (income) expense in the Consolidated Statements of Income. As of March 31, 2024, the Company is in compliance with all funding requirements of each of its defined benefit plans. During the first quarter of 2024, the Company made contributions of $2 million to its U.S. non-contributory non-qualified defined benefit plans and estimates it will contribute an additional $7 million to such plans during the remainder of 2024. During the first quarter of 2024, the Company made contributions of $10 million to its international pension plans and estimates it will contribute an additional $35 million to such plans during the remainder of 2024. During the first quarter of 2024, the Company made contributions of $3 million to its U.S. postretirement health care plans and estimates it will contribute an additional $9 million to such plans during the remainder of 2024. |
REVENUES
REVENUES | 3 Months Ended |
Mar. 31, 2024 | |
REVENUES | |
REVENUES | 14. REVENUES Revenue Recognition Product and Sold Equipment Product revenue is generated from sales of cleaning, sanitizing, water treatment, process treatment 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. On June 3, 2020, the Company completed the separation of its Upstream Energy business (“ChampionX”). The Company entered into an agreement with ChampionX to provide, receive or transfer certain products for a transitionary period. Transitionary period sales of product to ChampionX under the 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. The remaining sales to ChampionX are recorded in product and equipment sales in the Global Industrial segment along with the related cost of sales. 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 Global Pest Elimination 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. The Company’s operating lease revenue was as follows: First Quarter Ended March 31 (millions) 2024 2023 Operating lease revenue* $133.2 $126.4 *Includes immaterial variable lease revenue The following table shows principal activities, separated by reportable segments, from which the Company generates its revenue. The Corporate segment includes sales to ChampionX under the transitional supply agreement entered into as part of the ChampionX Separation. For more information about the Company’s reportable segments, refer to Note 15. Net sales at public exchange rates by reportable segment are as follows: First Quarter Ended March 31 (millions) 2024 2023 Global Industrial Product and sold equipment $1,612.5 $1,592.3 Service and lease equipment 226.7 216.8 Global Institutional & Specialty Product and sold equipment 1,021.4 920.8 Service and lease equipment 245.3 208.0 Global Healthcare & Life Sciences Product and sold equipment 352.6 352.6 Service and lease equipment 27.3 27.1 Global Pest Elimination Product and sold equipment - - Service and lease equipment 266.1 243.4 Corporate Product and sold equipment - 10.6 Service and lease equipment - - Total Total product and sold equipment $2,986.5 $2,876.3 Total service and lease equipment $765.4 $695.3 Net sales at public exchange rates by geographic region for the first quarter ended March 31 are as follows: Global Global Institutional Global Healthcare Global Pest Industrial & Specialty & Life Sciences Elimination Corporate 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 United States $793.8 $793.0 $883.2 $786.0 $149.8 $162.5 $181.7 $165.9 $- $9.6 Europe 374.6 377.4 160.5 146.5 184.5 174.4 43.2 38.7 - 0.7 Asia Pacific 230.7 228.4 59.3 56.8 23.4 19.6 7.6 6.9 - - Latin America 189.6 158.2 49.9 41.3 5.5 5.7 14.5 13.6 - 0.3 Greater China 97.7 96.9 44.7 35.6 9.4 10.8 14.7 14.0 - - India, Middle East and Africa 99.2 104.4 15.5 14.7 5.4 5.3 1.7 1.9 - - Canada 53.6 50.8 53.6 47.9 1.9 1.4 2.7 2.4 - - Total $1,839.2 $1,809.1 $1,266.7 $1,128.8 $379.9 $379.7 $266.1 $243.4 $- $10.6 Net sales by geographic region were determined based on origin of sale. The United States made up 54% of total revenues during both the first quarter ended March 31, 2024 and 2023. Accounts Receivable and Allowance for Expected Credit Losses Accounts receivable are carried at the invoiced amounts, less an allowance for expected credit losses, and generally do not bear interest. The Company’s allowance for expected credit losses estimates the amount of expected future credit losses by analyzing accounts receivable balances by age and applying historical write-off and collection experience. The Company’s estimates separately consider macroeconomic trends, specific circumstances and credit conditions of customer receivables. Account balances are written off against the allowance when it is determined the receivable will not be recovered. The Company’s allowance for expected return of products shipped and credits related to pricing or quantities shipped was $73.5 million and $71.7 million as of March 31, 2024 and December 31, 2023, respectively. Returns and credit activity is recorded directly as a reduction to revenue. The following table summarizes the activity in the allowance for expected credit losses: First Quarter Ended March 31 (millions) 2024 2023 Beginning balance $77.3 $71.9 Bad debt expense 13.2 14.7 Write-offs (10.6) (7.9) Other (a) (0.9) (1.3) Ending balance $79.0 $77.4 (a) O ther amounts are primarily the effects of changes in currency translations. 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. The following table summarizes the contract liability activity: First Quarter Ended March 31 (millions) 2024 2023 Contract liability as of beginning of the year $110.9 $116.5 Revenue recognized in the period from: Amounts included in the contract liability at the beginning of the year (110.9) (116.5) Increases due to billings excluding amounts recognized as revenue during the period ended 118.0 107.5 Contract liability as of end of period $118.0 $107.5 |
OPERATING SEGMENTS
OPERATING SEGMENTS | 3 Months Ended |
Mar. 31, 2024 | |
OPERATING SEGMENTS | |
OPERATING SEGMENTS | 15. OPERATING SEGMENTS The Company’s organizational structure consists of global business unit and global regional leadership teams. The Company’s eight 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 four reportable segments: Global Industrial, Global Institutional & Specialty, Global Healthcare & Life Sciences and Global Pest Elimination. Comparability of Reportable Segments Effective January 1, 2024, the Company’s former Textile Care and Colloidal Technologies Group (“CTG”) operating segments are now part of the Water operating segment which continues to remain in the Global Industrial reportable segment. Additionally, the Pest Elimination operating segment, formerly aggregated with the Textile Care and CTG operating segments within Other, is now reported as the stand-alone Global Pest Elimination reportable segment. The Company made other immaterial changes, including the movement of certain customers and cost allocations between reportable segments. These changes are presented in "Other" columns of the table below . Prior period amounts have been recast to conform with current period presentation. 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 international operations at fixed currency exchange rates established by management at the beginning of 2024, rather than the 2023 established rates. 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 following table. The impact of the preceding changes on previously reported full year 2023 reportable segment net sales and operating income is summarized as follows: December 31, 2023 2023 Reported Fixed 2023 Reported Valued at 2023 Currency Valued at 2024 (millions) Management Rates Other Rate Change Management Rates Net Sales Global Industrial $7,193.1 $407.3 $40.1 $7,640.5 Global Institutional & Specialty 4,994.0 - 20.6 5,014.6 Global Healthcare & Life Sciences 1,576.9 - 30.6 1,607.5 Global Pest Elimination - 1,061.5 8.7 1,070.2 Other 1,442.3 (1,442.3) - - Corporate 69.1 (26.5) 0.1 42.7 Subtotal at fixed currency rates 15,275.4 - 100.1 15,375.5 Effect of foreign currency translation 44.8 (100.1) (55.3) Consolidated reported GAAP net sales $15,320.2 $- $- $15,320.2 Operating Income Global Industrial $1,080.7 $39.0 $2.3 $1,122.0 Global Institutional & Specialty 823.0 14.9 3.9 841.8 Global Healthcare & Life Sciences 160.0 (6.7) 7.5 160.8 Global Pest Elimination - 209.0 1.4 210.4 Other 255.0 (255.0) - - Corporate (331.7) (1.2) 0.1 (332.8) Subtotal at fixed currency rates 1,987.0 - 15.2 2,002.2 Effect of foreign currency translation 5.3 - (15.2) (9.9) Consolidated reported GAAP operating income $1,992.3 $- $- $1,992.3 Reportable Segment Information Financial information for the Company’s reportable segments, is as follows: First Quarter Ended March 31 (millions) 2024 2023 Net Sales Global Industrial $1,841.7 $1,808.2 Global Institutional & Specialty 1,270.3 1,131.2 Global Healthcare & Life Sciences 382.9 386.1 Global Pest Elimination 266.8 244.6 Corporate - 10.7 Subtotal at fixed currency rates 3,761.7 3,580.8 Effect of foreign currency translation (9.8) (9.2) Consolidated reported GAAP net sales $3,751.9 $3,571.6 Operating Income Global Industrial $265.0 $219.8 Global Institutional & Specialty 248.0 130.1 Global Healthcare & Life Sciences 37.0 35.4 Global Pest Elimination 48.8 44.5 Corporate (79.8) (77.4) Subtotal at fixed currency rates 519.0 352.4 Effect of foreign currency translation (1.1) (0.8) Consolidated reported GAAP operating income $517.9 $351.6 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 transitional supply agreement entered into with the Transaction, as discussed in Note 14. Corporate also includes intangible asset amortization specifically from the Nalco and Purolite acquisitions 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 | 3 Months Ended |
Mar. 31, 2024 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 16. 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. TPC Group Litigation On November 27, 2019, a Butadiene production plant owned and operated by TPC Group, Inc. in Port Neches, Texas, experienced an explosion and fire that resulted in personal injuries, the release of chemical fumes and extensive property damage to the plant and surrounding areas in and near Port Neches, Texas. Nalco Company LLC, a subsidiary of Ecolab, supplied process chemicals to TPC used in TPC’s production processes. Nalco did not operate, manage, maintain or control any aspect of TPC’s plant operations. In connection with its provision of process chemicals to TPC, Nalco was named in numerous lawsuits stemming from the plant explosion. Nalco has been named a defendant, along with TPC and other defendants, in multi-district litigation (“MDL”) proceedings pending in Orange County, Texas, alleging among other things claims for personal injury, property damage and business losses (In re TPC Group Litigation – A2020-0236-MDL, Orange County, Texas). Numerous other lawsuits were filed against Nalco, including TPC Group v. Nalco, E0208239, Jefferson County, Texas, a subrogation claim by TPC’s insurers seeking reimbursement for property damage losses. Over 5,000 plaintiffs (including the subrogation matter) asserted claims against Nalco. All claims have been consolidated for pretrial purposes into the MDL. All of these cases make similar allegations and seek damages for personal injury, property damage, business losses and other damages, including exemplary damages. Due to the large number of plaintiffs, the early stage of the litigation and the fact that many of the claims do not specify an amount of damages, any estimate of any loss or range of losses cannot be made at this time. On June 1, 2022, TPC and seven of its affiliated companies filed for bankruptcy under Chapter 11 (Case No. 22-10493-CTG, United States Bankruptcy Court for the District of Delaware). In connection with the bankruptcy cases, TPC disclosed an estimated range of its liability related to the Port Neches incident to individuals and homeowners (including subrogation claims) of approximately $152 million to $520 million. As part of their bankruptcy plan, TPC and its affiliates announced a settlement which allows the MDL plaintiffs a $500 million claim solely for purposes of claim allowance in the chapter 11 case and distribution of value pursuant to TPC’s bankruptcy plan. Other key terms of the settlement between TPC and the MDL plaintiffs include the establishment of a settlement trust for the benefit of certain general unsecured creditors, which is funded with $30 million and the assignment of TPC’s claims and causes of action, if any, against certain third parties, including Nalco, related to the TPC plant explosion. As part of the bankruptcy process, TPC and its debtor affiliates received a discharge of all MDL related claims, as did certain non-debtor affiliates to the extent third parties did not opt out of the non-debtor releases. As a result, TPC is no longer a defendant in the MDL. Nalco opted out of these releases, preserving any direct causes of action it may have against non-debtors. Furthermore, the allowance of the $500 million claim should have no effect on any claims or defenses asserted against or by Nalco in the MDL litigation. On December 1, 2022, the bankruptcy court confirmed the TPC bankruptcy plan, including the approval of the settlement and establishment of the aforementioned settlement trust. On December 16, 2022, the TPC bankruptcy plan went effective. As a result of the bankruptcy, the MDL was stayed. The stay was lifted in the fourth quarter of 2023 and various activities advancing discovery have resumed. The Company believes the claims asserted against Nalco in the lawsuits stemming from the TPC plant explosion are without merit and intends to defend the claims vigorously. The Company also believes any potential loss should be covered by insurance subject to deductibles. However, the Company cannot predict the outcome of these lawsuits, the involvement the Company might have in these matters in the future or the potential for future litigation. Environmental Matters The Company is currently participating in environmental assessments and remediation at approximately 25 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 | 3 Months Ended |
Mar. 31, 2024 | |
NEW ACCOUNTING PRONOUNCEMENTS | |
NEW ACCOUNTING PRONOUNCEMENTS | 17. NEW ACCOUNTING PRONOUNCEMENTS Standards That Are Not Yet Adopted: Date of Date of Effect on the Standard Issuance Description Adoption Financial Statements ASU 2023-09 Income taxes (Topic 740): Improvements to Income Tax Disclosures December 2023 The amendments in this Update require that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold. January 1, 2025 The Company is currently evaluating the impact of adoption and additional disclosure requirements. ASU 2023-07 - Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures November 2023 The amendments in this ASU are to improve the disclosures about reportable segments and add more detailed information about a reportable segment’s expenses. The amendments in the ASU require public entities to disclose on an annual and interim basis significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss, other segment items by reportable segment, the title and position of the CODM, and an explanation of how the CODM uses the reported measures of segment profit or loss in assessing segment performance and deciding how to allocate resources. The ASU does not change the definition of a segment, the method for determining segments, the criteria for aggregating operating segments into reportable segments, or the current specifically enumerated segment expenses that are required to be disclosed. Effective for annual periods beginning after December 15, 2023 Entities are required to apply the disclosure amendments on a retrospective basis to all periods presented. The Company is currently evaluating the impact of adoption. 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. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2024 | |
Subsequent Events | |
Subsequent Events | 18. Subsequent Events On April 27, 2024, the Company reached a definitive agreement to sell its global surgical solutions business for total consideration of $950 million in cash, subject to certain working capital and other purchase price adjustments. The sale is expected to close in the second half of 2024, subject to regulatory clearances and other customary closing conditions. The Company expects to record an associated pre-tax gain within special (gains) and charges in the Consolidated Statements of Income. |
SPECIAL (GAINS) AND CHARGES (Ta
SPECIAL (GAINS) AND CHARGES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring Activities | |
Special (gains) and charges | First Quarter Ended March 31 (millions) 2024 2023 Cost of sales Restructuring activities $1.6 $3.2 Cost of sales subtotal 1.6 3.2 Special (gains) and charges Restructuring activities 18.1 12.6 Acquisition and integration activities 2.5 5.0 Other 7.6 6.9 Special (gains) and charges subtotal 28.2 24.5 Total special (gains) and charges $29.8 $27.7 |
Combined Program | |
Restructuring Activities | |
Restructuring activity | Employee Asset (millions) Costs Disposals Other Total 2022-2023 Activity Recorded expense and accrual $114.2 $14.0 $16.7 $144.9 Net cash payments (90.4) - (16.7) (107.1) Non-cash charges - (14.0) - (14.0) Reclassification 19.3 - - 19.3 Net restructuring liability, December 31, 2023 43.1 - - 43.1 2024 Activity Recorded expense and accrual 2.3 0.4 17.0 19.7 Net cash payments (15.9) - (2.4) (18.3) Non-cash charges - (0.4) - (0.4) Net restructuring liability, March 31, 2024 $29.5 $- $14.6 $44.1 |
BALANCE SHEET INFORMATION (Tabl
BALANCE SHEET INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
BALANCE SHEET INFORMATION | |
Balance Sheet Information | March 31 December 31 (millions) 2024 2023 Accounts receivable, net Accounts receivable $2,939.1 $2,983.2 Allowance for expected credit losses and other accruals (152.5) (149.0) Total $2,786.6 $2,834.2 Inventories Finished goods $970.2 $911.4 Raw materials and parts 702.4 704.7 Inventories at FIFO cost 1,672.6 1,616.1 FIFO cost to LIFO cost difference (106.7) (118.9) Total $1,565.9 $1,497.2 Other current assets Prepaid assets $153.5 $143.9 Taxes receivable 169.3 186.9 Derivative assets 7.2 3.3 Other 49.3 59.1 Total $379.3 $393.2 Property, plant and equipment, net Land $154.9 $155.6 Buildings and leasehold improvements 1,178.8 1,171.0 Machinery and equipment 2,146.7 2,113.8 Merchandising and customer equipment 2,817.7 2,758.4 Capitalized software 1,006.4 985.9 Construction in progress 454.1 470.1 7,758.6 7,654.8 Accumulated depreciation (4,307.5) (4,180.2) Total $3,451.1 $3,474.6 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 3,374.8 3,385.1 Patents 505.2 503.6 Trademarks 404.4 406.5 Other technologies 551.0 551.2 4,835.4 4,846.4 Accumulated amortization Customer relationships (1,850.9) (1,805.0) Patents (326.3) (319.4) Trademarks (244.6) (238.0) Other technologies (230.0) (220.5) (2,651.8) (2,582.9) Net intangible assets subject to amortization 2,183.6 2,263.5 Total $3,413.6 $3,493.5 Other assets Deferred income taxes $122.0 $119.3 Pension 120.8 118.4 Derivative asset 26.5 23.6 Other 275.1 271.4 Total $544.4 $532.7 March 31 December 31 (millions) 2024 2023 Other current liabilities Discounts and rebates $442.1 $438.8 Dividends payable 163.0 162.7 Interest payable 64.6 68.5 Taxes payable, other than income 143.8 153.2 Derivative liability 1.2 3.7 Restructuring 48.8 48.9 Contract liability 118.0 110.9 Operating lease liabilities 130.1 126.1 Other 242.5 222.1 Total $1,354.1 $1,334.9 Accumulated other comprehensive income (loss) Unrealized gain (loss) on derivative financial instruments, net of tax $1.0 ($4.1) Unrecognized pension and postretirement benefit expense, net of tax (532.4) (534.7) Cumulative translation, net of tax (1,349.8) (1,311.6) Total ($1,881.2) ($1,850.4) |
DEBT AND INTEREST (Tables)
DEBT AND INTEREST (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
DEBT AND INTEREST | |
Schedule of short-term debt obligations | March 31 December 31 (millions) 2024 2023 Short-term debt Notes payable $8.9 $1.8 Long-term debt, current maturities 2.4 628.6 Total $11.3 $630.4 |
Schedule of long-term debt obligations including current maturities | Maturity March 31 December 31 (millions) by Year 2024 2023 Long-term debt Public notes (2024 principal amount) Seven year 2016 senior notes ( €575 million) 2024 $- $625.9 Ten year 2015 senior notes ( €575 million) 2025 620.4 625.1 Ten year 2016 senior notes ( $750 million) 2026 728.8 728.2 Ten year 2017 senior notes ( $500 million) 2027 447.7 448.3 Six Year 2021 senior notes ( $500 million) 2027 497.6 497.4 Five Year 2022 senior notes ( $500 million) 2028 494.5 494.2 Ten year 2020 senior notes ( $698 million) 2030 647.7 662.7 Ten year 2020 senior notes ( $600 million) 2031 556.1 561.0 Eleven year 2021 senior notes ( $650 million) 2032 645.3 645.2 Thirty year 2011 senior notes ( $389 million) 2041 384.8 384.7 Thirty year 2016 senior notes ( $200 million) 2046 197.4 197.4 Thirty year 2017 senior notes ( $484 million) 2047 427.2 426.8 Thirty year 2020 senior notes ( $500 million) 2050 491.2 491.1 Thirty year 2021 senior notes ( $850 million) 2051 839.4 839.3 Thirty-four year 2021 senior notes ( $685 million) 2055 539.7 539.2 Finance lease obligations and other 13.2 13.5 Total debt 7,531.0 8,180.0 Long-term debt, current maturities (2.4) (628.6) Total long-term debt $7,528.6 $7,551.4 |
Schedule of interest expense and interest income | First Quarter Ended March 31 (millions) 2024 2023 Interest expense $94.5 $80.1 Interest income (22.9) (5.9) Interest expense, net $71.6 $74.2 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
GOODWILL AND OTHER INTANGIBLE ASSETS | |
Changes in the carrying amount of goodwill | Global Global Global Global Institutional Healthcare & Pest (millions) Industrial & Specialty Life Sciences Elimination Other Total December 31, 2023 $4,140.6 $610.0 $3,158.4 $- $239.2 $8,148.2 Segment changes (a) 102.9 - - 136.3 (239.2) - December 31, 2023 recast 4,243.5 610.0 3,158.4 136.3 - 8,148.2 Effect of foreign currency translation (26.0) (0.8) (9.8) (0.2) - (36.8) March 31, 2024 $4,217.5 $609.2 $3,148.6 $136.1 $- $8,111.4 (a) Relates to reclassifications made to reportable segments in the current year. Effective January 1, 2024, the Company’s former Textile Care and Colloidal Technologies Group (“CTG”) operating segments are now part of the Water operating segment which continues to remain in the Global Industrial reportable segment. Additionally, the Pest Elimination operating segment, formerly aggregated with the Textile Care and CTG operating segments within Other, is now reported as the stand-alone Global Pest Elimination reportable segment. After these changes, the Company has eight operating segments aligned with eight reporting units. Refer to Note 15 for further information. |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
FAIR VALUE MEASUREMENTS | |
Schedule of the carrying amount and estimated fair value of assets and liabilities measured on recurring basis | March 31, 2024 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $21.6 $- $21.6 $- Cross-currency swap derivative contracts 33.1 - 33.1 - Liabilities Foreign currency forward contracts 15.6 - 15.6 - Interest rate swap agreements 167.6 - 167.6 - Cross-currency swap derivative contracts 22.1 - 22.1 - December 31, 2023 (millions) Carrying Fair Value Measurements Amount Level 1 Level 2 Level 3 Assets Foreign currency forward contracts $26.6 $- $26.6 $- Cross-currency swap derivative contracts 29.1 - 29.1 - Liabilities Foreign currency forward contracts 27.0 - 27.0 - Interest rate swap agreements 146.5 - 146.5 - Cross-currency swap derivative contracts 24.9 - 24.9 - |
Schedule of carrying amount and estimated fair value of long-term debt | March 31, 2024 December 31, 2023 Carrying Fair Carrying Fair Amount Value Amount Value Long-term debt, including current maturities $7,531.0 $6,765.9 $8,180.0 $7,552.5 |
DERIVATIVES AND HEDGING TRANS_2
DERIVATIVES AND HEDGING TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
DERIVATIVES AND HEDGING TRANSACTIONS | |
Gross fair value of the company's outstanding derivative assets and liabilities | Derivative Assets Derivative Liabilities March 31 December 31 March 31 December 31 (millions) 2024 2023 2024 2023 Derivatives designated as hedging instruments Foreign currency forward contracts $8.6 $6.7 $2.2 $5.2 Interest rate swap agreements - - 167.6 146.5 Cross-currency swap derivative contracts 33.1 29.1 22.1 24.9 Derivatives not designated as hedging instruments Foreign currency forward contracts 13.0 19.9 13.4 21.8 Gross value of derivatives 54.7 55.7 205.3 198.4 Gross amounts offset in the Consolidated Balance Sheets (21.0) (28.8) (21.0) (28.8) Net value of derivatives $33.7 $26.9 $184.3 $169.6 |
Summary of notional values of outstanding derivatives | Notional Values March 31 December 31 (millions) 2024 2023 Foreign currency forward contracts $2,978 $3,745 Interest rate swap agreements 1,500 1,500 Cross-currency swap derivative contracts 976 998 |
Schedule of amounts on the Consolidated 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 First Quarter Ended First Quarter Ended Line item in which the hedged item is included March 31 March 31 (millions) 2024 2023 2024 2023 Long-term debt $1,333.6 $1,348.9 ($168.7) ($153.4) |
Revaluation gains and losses on euro notes and cross-currency swap derivative | First Quarter Ended March 31 (millions) 2024 2023 Revaluation gain (loss), net of tax: Euronotes $2.5 ($15.1) Cross-currency swap derivative contracts 6.4 (1.6) Total revaluation gain (loss), net of tax $8.9 ($16.7) |
Impact on AOCI and earnings from derivative contracts qualified as cash flow hedges | First Quarter Ended March 31 2024 2023 (millions) COS SG&A Interest COS SG&A Interest Gain (loss) on derivatives designated as hedging instruments: Foreign currency forward contracts Amount of gain (loss) reclassified from AOCI to income $- $0.7 $- $5.3 ($6.0) $- Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value - - - - - 2.0 Interest rate swap agreements Amount of (loss) gain reclassified from AOCI to income - - (0.5) - - (0.5) Gain (loss) on derivatives not designated as hedging instruments: Foreign currency forward contracts Amount of gain (loss) recognized in income - 0.4 - - (24.6) - Total gain (loss) of all derivative instruments $- $1.1 ($0.5) $5.3 ($30.6) $1.5 |
OTHER COMPREHENSIVE INCOME (L_2
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION | |
Schedule of other comprehensive income (loss) information related to the Company's derivatives and hedging instruments and pension and postretirement benefits | First Quarter Ended March 31 (millions) 2024 2023 Derivative and Hedging Instruments Unrealized gain (loss) on derivative and hedging instruments Amount recognized in AOCI $6.6 ($5.1) (Gain) loss reclassified from AOCI into income COS - (5.3) SG&A (0.7) 6.0 Interest (income) expense, net 0.5 (1.5) (0.2) (0.8) Other activity - 0.1 Tax impact (1.3) 1.1 Net of tax $5.1 ($4.7) Pension and Postretirement Benefits Amount reclassified from AOCI into income Settlement charge $0.4 $0.6 Amortization of losses and prior period service credits, net 1.7 1.6 2.1 2.2 Other activity 0.9 (1.6) Tax impact (0.7) (0.4) Net of tax $2.3 $0.2 |
Summary of the net of tax derivative and pension and postretirement benefit amounts reclassified from AOCI into income | First Quarter Ended March 31 2024 2023 (millions) Derivative (gain) loss reclassified from AOCI into income, net of tax ($0.1) ($0.6) Pension and postretirement benefits amortization of losses and prior period service credits, net and settlement charge, reclassified from AOCI into income, net of tax 2.3 0.2 |
EARNINGS ATTRIBUTABLE TO ECOL_2
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") | |
Computations of the basic and diluted EPS | First Quarter Ended March 31 (millions, except per share) 2024 2023 Net income attributable to Ecolab $412.1 $233.4 Weighted-average common shares outstanding Basic 285.7 284.6 Effect of dilutive stock options and units 2.1 1.3 Diluted 287.8 285.9 Earnings attributable to Ecolab per common share Basic EPS $1.44 $0.82 Diluted EPS $1.43 $0.82 Anti-dilutive securities excluded from the computation of diluted EPS 2.4 4.6 Amounts do not necessarily sum due to rounding. |
PENSION AND POSTRETIREMENT PL_2
PENSION AND POSTRETIREMENT PLANS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
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 first quarter ended March 31 are as follows: U.S. International U.S. Postretirement Pensions Pensions Benefits (millions) 2024 2023 2024 2023 2024 2023 Service cost $11.6 $10.2 $4.9 $5.4 $0.1 $0.1 Interest cost on benefit obligation 21.8 22.0 12.4 11.4 1.3 1.4 Expected return on plan assets (37.7) (36.3) (12.5) (13.8) - - Recognition of net actuarial loss (gain) 1.5 - 2.2 3.5 (0.8) (0.8) Amortization of prior service benefit (1.1) (1.0) (0.1) (0.1) - - Curtailments and settlements 0.4 0.7 - - - (0.1) Total expense (benefit) ($3.5) ($4.4) $6.9 $6.4 $0.6 $0.6 |
REVENUES (Tables)
REVENUES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
REVENUES | |
Schedule of operating lease revenue | First Quarter Ended March 31 (millions) 2024 2023 Operating lease revenue* $133.2 $126.4 |
Schedule of principal activities, separated by reportable segments and geographic region | Net sales at public exchange rates by reportable segment are as follows: First Quarter Ended March 31 (millions) 2024 2023 Global Industrial Product and sold equipment $1,612.5 $1,592.3 Service and lease equipment 226.7 216.8 Global Institutional & Specialty Product and sold equipment 1,021.4 920.8 Service and lease equipment 245.3 208.0 Global Healthcare & Life Sciences Product and sold equipment 352.6 352.6 Service and lease equipment 27.3 27.1 Global Pest Elimination Product and sold equipment - - Service and lease equipment 266.1 243.4 Corporate Product and sold equipment - 10.6 Service and lease equipment - - Total Total product and sold equipment $2,986.5 $2,876.3 Total service and lease equipment $765.4 $695.3 Net sales at public exchange rates by geographic region for the first quarter ended March 31 are as follows: Global Global Institutional Global Healthcare Global Pest Industrial & Specialty & Life Sciences Elimination Corporate 2024 2023 2024 2023 2024 2023 2024 2023 2024 2023 United States $793.8 $793.0 $883.2 $786.0 $149.8 $162.5 $181.7 $165.9 $- $9.6 Europe 374.6 377.4 160.5 146.5 184.5 174.4 43.2 38.7 - 0.7 Asia Pacific 230.7 228.4 59.3 56.8 23.4 19.6 7.6 6.9 - - Latin America 189.6 158.2 49.9 41.3 5.5 5.7 14.5 13.6 - 0.3 Greater China 97.7 96.9 44.7 35.6 9.4 10.8 14.7 14.0 - - India, Middle East and Africa 99.2 104.4 15.5 14.7 5.4 5.3 1.7 1.9 - - Canada 53.6 50.8 53.6 47.9 1.9 1.4 2.7 2.4 - - Total $1,839.2 $1,809.1 $1,266.7 $1,128.8 $379.9 $379.7 $266.1 $243.4 $- $10.6 |
Summarized activity in the allowance for doubtful accounts | First Quarter Ended March 31 (millions) 2024 2023 Beginning balance $77.3 $71.9 Bad debt expense 13.2 14.7 Write-offs (10.6) (7.9) Other (a) (0.9) (1.3) Ending balance $79.0 $77.4 (a) O ther amounts are primarily the effects of changes in currency translations. |
Schedule of contract liability | First Quarter Ended March 31 (millions) 2024 2023 Contract liability as of beginning of the year $110.9 $116.5 Revenue recognized in the period from: Amounts included in the contract liability at the beginning of the year (110.9) (116.5) Increases due to billings excluding amounts recognized as revenue during the period ended 118.0 107.5 Contract liability as of end of period $118.0 $107.5 |
OPERATING SEGMENTS (Tables)
OPERATING SEGMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
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 2021 net sales and operating income | December 31, 2023 2023 Reported Fixed 2023 Reported Valued at 2023 Currency Valued at 2024 (millions) Management Rates Other Rate Change Management Rates Net Sales Global Industrial $7,193.1 $407.3 $40.1 $7,640.5 Global Institutional & Specialty 4,994.0 - 20.6 5,014.6 Global Healthcare & Life Sciences 1,576.9 - 30.6 1,607.5 Global Pest Elimination - 1,061.5 8.7 1,070.2 Other 1,442.3 (1,442.3) - - Corporate 69.1 (26.5) 0.1 42.7 Subtotal at fixed currency rates 15,275.4 - 100.1 15,375.5 Effect of foreign currency translation 44.8 (100.1) (55.3) Consolidated reported GAAP net sales $15,320.2 $- $- $15,320.2 Operating Income Global Industrial $1,080.7 $39.0 $2.3 $1,122.0 Global Institutional & Specialty 823.0 14.9 3.9 841.8 Global Healthcare & Life Sciences 160.0 (6.7) 7.5 160.8 Global Pest Elimination - 209.0 1.4 210.4 Other 255.0 (255.0) - - Corporate (331.7) (1.2) 0.1 (332.8) Subtotal at fixed currency rates 1,987.0 - 15.2 2,002.2 Effect of foreign currency translation 5.3 - (15.2) (9.9) Consolidated reported GAAP operating income $1,992.3 $- $- $1,992.3 |
Schedule of financial information for each of the entity's reportable segments | First Quarter Ended March 31 (millions) 2024 2023 Net Sales Global Industrial $1,841.7 $1,808.2 Global Institutional & Specialty 1,270.3 1,131.2 Global Healthcare & Life Sciences 382.9 386.1 Global Pest Elimination 266.8 244.6 Corporate - 10.7 Subtotal at fixed currency rates 3,761.7 3,580.8 Effect of foreign currency translation (9.8) (9.2) Consolidated reported GAAP net sales $3,751.9 $3,571.6 Operating Income Global Industrial $265.0 $219.8 Global Institutional & Specialty 248.0 130.1 Global Healthcare & Life Sciences 37.0 35.4 Global Pest Elimination 48.8 44.5 Corporate (79.8) (77.4) Subtotal at fixed currency rates 519.0 352.4 Effect of foreign currency translation (1.1) (0.8) Consolidated reported GAAP operating income $517.9 $351.6 |
NEW ACCOUNTING PRONOUNCEMENTS (
NEW ACCOUNTING PRONOUNCEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
NEW ACCOUNTING PRONOUNCEMENTS | |
Schedule of new accounting pronouncements | Standards That Are Not Yet Adopted: Date of Date of Effect on the Standard Issuance Description Adoption Financial Statements ASU 2023-09 Income taxes (Topic 740): Improvements to Income Tax Disclosures December 2023 The amendments in this Update require that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold. January 1, 2025 The Company is currently evaluating the impact of adoption and additional disclosure requirements. ASU 2023-07 - Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures November 2023 The amendments in this ASU are to improve the disclosures about reportable segments and add more detailed information about a reportable segment’s expenses. The amendments in the ASU require public entities to disclose on an annual and interim basis significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”) and included within each reported measure of segment profit or loss, other segment items by reportable segment, the title and position of the CODM, and an explanation of how the CODM uses the reported measures of segment profit or loss in assessing segment performance and deciding how to allocate resources. The ASU does not change the definition of a segment, the method for determining segments, the criteria for aggregating operating segments into reportable segments, or the current specifically enumerated segment expenses that are required to be disclosed. Effective for annual periods beginning after December 15, 2023 Entities are required to apply the disclosure amendments on a retrospective basis to all periods presented. The Company is currently evaluating the impact of adoption. |
SPECIAL (GAINS) AND CHARGES - C
SPECIAL (GAINS) AND CHARGES - Charges Reported on Statement of Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Special (gains) and charges | ||
Other (income) expense | $ 28.2 | $ 24.5 |
Total special (gains) and charges | 29.8 | 27.7 |
Cost of sales | ||
Special (gains) and charges | ||
Restructuring activities | 1.6 | 3.2 |
Other (income) expense | 1.6 | 3.2 |
Special (gains) and charges | ||
Special (gains) and charges | ||
Restructuring activities | 18.1 | 12.6 |
Acquisition and integration activities | 2.5 | 5 |
Other special gains and charges | 7.6 | 6.9 |
Other (income) expense | $ 28.2 | $ 24.5 |
SPECIAL (GAINS) AND CHARGES - R
SPECIAL (GAINS) AND CHARGES - Restructuring and Non-Restructuring Activity (Details) - USD ($) $ in Millions | 3 Months Ended | 24 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Feb. 28, 2023 | Nov. 30, 2022 | |
Other restructuring information | |||||
Special (gains) and charges | $ 28.2 | $ 24.5 | |||
Non-restructuring Special (Gains) and Charges | |||||
Accounts payable | 1,607.1 | $ 1,566.3 | |||
Other current liabilities | 1,354.1 | 1,334.9 | |||
Special (gains) and charges | |||||
Other restructuring information | |||||
Restructuring charges incurred, pre-tax | 18.1 | 12.6 | |||
Business combination advisory and legal fees, pre tax | 2.5 | 5 | |||
Business combination advisory and legal fees, after tax | 1.9 | ||||
Other special gains and charges | 7.6 | 6.9 | |||
Special (gains) and charges | 28.2 | 24.5 | |||
Non-restructuring Special (Gains) and Charges | |||||
Business combination and integration related costs, pre tax | 5 | ||||
Business combination and integration related costs, after tax | 3.7 | ||||
Cost of sales | |||||
Other restructuring information | |||||
Restructuring charges incurred, pre-tax | 1.6 | 3.2 | |||
Special (gains) and charges | 1.6 | 3.2 | |||
Specific legal reserve and related legal charges | |||||
Other restructuring information | |||||
Other special gains and charges | 7.6 | 6.9 | |||
Other special gains and charges, after-tax | 5.4 | 5.4 | |||
Combined Program | |||||
Restructuring | |||||
Recorded expense (income) and accrual | 19.7 | 144.9 | |||
Net cash payments | (18.3) | (107.1) | |||
Non-cash charges | (0.4) | (14) | |||
Reclassification | 19.3 | ||||
Other restructuring information | |||||
Restructuring charge expected to be incurred, pre-tax | 19.3 | $ 195 | |||
Restructuring charge expected to be incurred, after tax | 14.5 | $ 150 | |||
Restructuring liability | 44.1 | 43.1 | |||
Restructuring charges incurred, pre-tax | 183.9 | ||||
Restructuring charges incurred, after tax | 152.7 | ||||
Combined Program | Employee termination costs | |||||
Restructuring | |||||
Recorded expense (income) and accrual | 2.3 | 114.2 | |||
Net cash payments | (15.9) | (90.4) | |||
Reclassification | 19.3 | ||||
Other restructuring information | |||||
Restructuring liability | 29.5 | 43.1 | |||
Restructuring charges incurred, pre-tax | 19.7 | 13.4 | |||
Restructuring charges incurred, after tax | 15.8 | $ 10.2 | |||
Combined Program | Asset disposals | |||||
Restructuring | |||||
Recorded expense (income) and accrual | 0.4 | 14 | |||
Non-cash charges | (0.4) | (14) | |||
Combined Program | Other. | |||||
Restructuring | |||||
Recorded expense (income) and accrual | 17 | 16.7 | |||
Net cash payments | (2.4) | $ (16.7) | |||
Other restructuring information | |||||
Restructuring liability | $ 14.6 | ||||
Europe Program | |||||
Other restructuring information | |||||
Restructuring charge expected to be incurred, pre-tax | $ 130 | ||||
Restructuring charge expected to be incurred, after tax | $ 110 |
ACQUISITIONS - Acquisition Summ
ACQUISITIONS - Acquisition Summary (Details) - item | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
ACQUISITIONS | ||
Number of acquisitions | 0 | 0 |
BALANCE SHEETS INFORMATION (Det
BALANCE SHEETS INFORMATION (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Accounts receivable, net | ||
Accounts receivable | $ 2,939.1 | $ 2,983.2 |
Allowance for expected credit losses and other accruals | (152.5) | (149) |
Total | 2,786.6 | 2,834.2 |
Inventories | ||
Finished goods | 970.2 | 911.4 |
Raw materials and parts | 702.4 | 704.7 |
Inventories at FIFO cost | 1,672.6 | 1,616.1 |
FIFO cost to LIFO cost difference | (106.7) | (118.9) |
Total | 1,565.9 | 1,497.2 |
Other current assets | ||
Prepaid assets | 153.5 | 143.9 |
Taxes receivable | 169.3 | 186.9 |
Derivative assets | 7.2 | 3.3 |
Other | 49.3 | 59.1 |
Total | 379.3 | 393.2 |
Property, plant and equipment, net | ||
Land | 154.9 | 155.6 |
Buildings and leasehold improvements | 1,178.8 | 1,171 |
Machinery and equipment | 2,146.7 | 2,113.8 |
Merchandising and customer equipment | 2,817.7 | 2,758.4 |
Capitalized software | 1,006.4 | 985.9 |
Construction in progress | 454.1 | 470.1 |
Property, plant and equipment, gross | 7,758.6 | 7,654.8 |
Accumulated depreciation | (4,307.5) | (4,180.2) |
Total | 3,451.1 | 3,474.6 |
Intangible assets subject to amortization: | ||
Other intangible assets, gross | 4,835.4 | 4,846.4 |
Accumulated amortization | (2,651.8) | (2,582.9) |
Net intangible assets subject to amortization | 2,183.6 | 2,263.5 |
Total | 3,413.6 | 3,493.5 |
Other assets | ||
Deferred income taxes | 122 | 119.3 |
Pension | 120.8 | 118.4 |
Derivative asset | 26.5 | 23.6 |
Other | 275.1 | 271.4 |
Total | 544.4 | 532.7 |
Other current liabilities | ||
Discounts and rebates | 442.1 | 438.8 |
Dividends payable | 163 | 162.7 |
Interest payable | 64.6 | 68.5 |
Taxes payable, other than income | 143.8 | 153.2 |
Derivative liability | 1.2 | 3.7 |
Restructuring | 48.8 | 48.9 |
Contract liability | 118 | 110.9 |
Operating lease liabilities | 130.1 | 126.1 |
Other | 242.5 | 222.1 |
Total | 1,354.1 | 1,334.9 |
Accumulated other comprehensive income (loss) | ||
Unrealized gain (loss) on derivative financial instruments, net of tax | 1 | (4.1) |
Unrecognized pension and postretirement benefit expense, net of tax | (532.4) | (534.7) |
Cumulative translation, net of tax | (1,349.8) | (1,311.6) |
Total | (1,881.2) | (1,850.4) |
Customer relationships | ||
Intangible assets subject to amortization: | ||
Other intangible assets, gross | 3,374.8 | 3,385.1 |
Accumulated amortization | (1,850.9) | (1,805) |
Trademarks | ||
Intangible assets subject to amortization: | ||
Other intangible assets, gross | 404.4 | 406.5 |
Accumulated amortization | (244.6) | (238) |
Patents | ||
Intangible assets subject to amortization: | ||
Other intangible assets, gross | 505.2 | 503.6 |
Accumulated amortization | (326.3) | (319.4) |
Other technologies | ||
Intangible assets subject to amortization: | ||
Other intangible assets, gross | 551 | 551.2 |
Accumulated amortization | (230) | (220.5) |
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 | Mar. 31, 2024 | Dec. 31, 2023 |
Components of the company's debt obligations | ||
Long-term debt, current maturities | $ 2.4 | $ 628.6 |
Short-term debt including current maturities of long-term debt | 11.3 | 630.4 |
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 | 0 |
European commercial paper | ||
Components of the company's debt obligations | ||
Maximum borrowing capacity, commercial paper | 2,000 | |
Notes payable | ||
Components of the company's debt obligations | ||
Short term borrowings | 8.9 | 1.8 |
Multi Currency Revolving 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 | 3 Months Ended | |||
Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Mar. 31, 2024 EUR (€) | Dec. 31, 2023 USD ($) | |
Debt instrument | ||||
Carrying value | $ 7,531 | $ 8,180 | ||
Long-term debt, current maturities | (2.4) | (628.6) | ||
Long-term debt | 7,528.6 | 7,551.4 | ||
Repayments of long-term debt | 629.6 | |||
Interest | ||||
Interest expense | 94.5 | $ 80.1 | ||
Interest income | (22.9) | (5.9) | ||
Interest expense, net | $ 71.6 | $ 74.2 | ||
Public Notes | ||||
Debt instrument | ||||
Principal outstanding payable at time of prepayment of notes (as a percent) | 101% | |||
Five Year 2022 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 494.5 | 494.2 | ||
Aggregate principal amount | $ 500 | |||
Debt instrument, term | 5 years | |||
Six Year 2021 Senior Notes | ||||
Debt instrument | ||||
Carrying value | $ 497.6 | 497.4 | ||
Aggregate principal amount | $ 500 | |||
Debt instrument, term | 6 years | |||
Ten year 2017 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 447.7 | 448.3 | ||
Aggregate principal amount | $ 500 | |||
Debt instrument, term | 10 years | |||
Ten year 2020 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 647.7 | 662.7 | ||
Aggregate principal amount | $ 698 | |||
Debt instrument, term | 10 years | |||
Ten year 2020 senior notes, maturing in 2031 | ||||
Debt instrument | ||||
Carrying value | $ 556.1 | 561 | ||
Aggregate principal amount | $ 600 | |||
Debt instrument, term | 10 years | |||
Eleven Year 2021 Senior Notes | ||||
Debt instrument | ||||
Carrying value | $ 645.3 | 645.2 | ||
Aggregate principal amount | $ 650 | |||
Debt instrument, term | 11 years | |||
Thirty year 2011 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 384.8 | 384.7 | ||
Aggregate principal amount | $ 389 | |||
Debt instrument, term | 30 years | |||
Thirty year 2017 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 427.2 | 426.8 | ||
Aggregate principal amount | $ 484 | |||
Debt instrument, term | 30 years | |||
Thirty year 2020 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 491.2 | 491.1 | ||
Aggregate principal amount | $ 500 | |||
Debt instrument, term | 30 years | |||
Thirty Year 2021 Senior Notes | ||||
Debt instrument | ||||
Carrying value | $ 839.4 | 839.3 | ||
Aggregate principal amount | $ 850 | |||
Debt instrument, term | 30 years | |||
Thirty-four year 2021 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 539.7 | 539.2 | ||
Aggregate principal amount | $ 685 | |||
Debt instrument, term | 34 years | |||
Seven year 2016 senior euro notes | ||||
Debt instrument | ||||
Carrying value | 625.9 | |||
Aggregate principal amount | € | € 575 | |||
Debt instrument, term | 7 years | |||
Ten year 2016 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 728.8 | 728.2 | ||
Aggregate principal amount | $ 750 | |||
Debt instrument, term | 10 years | |||
Thirty year 2016 senior notes | ||||
Debt instrument | ||||
Carrying value | $ 197.4 | 197.4 | ||
Aggregate principal amount | $ 200 | |||
Debt instrument, term | 30 years | |||
Ten Year 2015 senior euro notes | ||||
Debt instrument | ||||
Carrying value | $ 620.4 | 625.1 | ||
Aggregate principal amount | € | € 575 | |||
Debt instrument, term | 10 years | |||
Other debt. | ||||
Debt instrument | ||||
Carrying value | $ 13.2 | $ 13.5 |
GOODWILL AND OTHER INTANGIBLE_3
GOODWILL AND OTHER INTANGIBLE ASSETS (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2024 USD ($) | Mar. 31, 2024 USD ($) segment | Mar. 31, 2024 USD ($) item | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Changes in the carrying amount of goodwill for each of the company's reportable segments | |||||
Impairment of goodwill | $ 0 | ||||
Changes in the carrying amount of goodwill | |||||
Beginning goodwill | 8,148.2 | ||||
Goodwill revised | $ 8,148.2 | ||||
Effect of foreign currency translation | (36.8) | ||||
Ending goodwill | 8,111.4 | 8,148.2 | |||
Number of operating units | 8 | 8 | |||
Future estimated amortization expense related to amortizable other identifiable intangible assets | |||||
Estimated expense for the remaining six-month period | 224 | $ 224 | $ 224 | ||
Total amortization expense related to other intangible assets | 77.8 | $ 75.6 | |||
Nalco Holding Company ("Nalco") | Trademarks | |||||
Changes in the carrying amount of goodwill | |||||
Impairment of indefinite life intangible asset | 0 | ||||
Global Industrial | |||||
Changes in the carrying amount of goodwill | |||||
Beginning goodwill | 4,140.6 | ||||
Segment changes | 102.9 | ||||
Goodwill revised | 4,243.5 | ||||
Effect of foreign currency translation | (26) | ||||
Ending goodwill | 4,217.5 | 4,140.6 | |||
Global Institutional and Specialty | |||||
Changes in the carrying amount of goodwill | |||||
Beginning goodwill | 610 | ||||
Goodwill revised | 610 | ||||
Effect of foreign currency translation | (0.8) | ||||
Ending goodwill | 609.2 | 610 | |||
Global Healthcare and Life Sciences | |||||
Changes in the carrying amount of goodwill | |||||
Beginning goodwill | 3,158.4 | ||||
Goodwill revised | 3,158.4 | ||||
Effect of foreign currency translation | (9.8) | ||||
Ending goodwill | 3,148.6 | 3,158.4 | |||
Global Pest Elimination | |||||
Changes in the carrying amount of goodwill | |||||
Segment changes | 136.3 | ||||
Goodwill revised | 136.3 | ||||
Effect of foreign currency translation | (0.2) | ||||
Ending goodwill | 136.1 | ||||
Other | |||||
Changes in the carrying amount of goodwill | |||||
Beginning goodwill | $ 239.2 | ||||
Segment changes | (239.2) | ||||
Ending goodwill | $ 239.2 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Carrying Amount | ||
Liabilities: | ||
Interest rate swap agreements | $ 22.1 | |
Level 2 | ||
Liabilities: | ||
Interest rate swap agreements | 22.1 | |
Recurring | Carrying Amount | Foreign currency forward contracts | ||
Assets: | ||
Foreign currency forward contracts | 21.6 | $ 26.6 |
Liabilities: | ||
Foreign currency forward contracts | 15.6 | 27 |
Recurring | Carrying Amount | Interest rate swap agreements | ||
Liabilities: | ||
Interest rate swap agreements | 167.6 | 146.5 |
Recurring | Carrying Amount | Cross-currency swap derivative contracts | ||
Assets: | ||
Foreign currency forward contracts | 33.1 | 29.1 |
Liabilities: | ||
Interest rate swap agreements | 24.9 | |
Recurring | Level 2 | Foreign currency forward contracts | ||
Assets: | ||
Foreign currency forward contracts | 21.6 | 26.6 |
Liabilities: | ||
Foreign currency forward contracts | 15.6 | 27 |
Recurring | Level 2 | Interest rate swap agreements | ||
Liabilities: | ||
Interest rate swap agreements | 167.6 | 146.5 |
Recurring | Level 2 | Cross-currency swap derivative contracts | ||
Assets: | ||
Foreign currency forward contracts | $ 33.1 | 29.1 |
Liabilities: | ||
Interest rate swap agreements | $ 24.9 |
FAIR VALUE MEASUREMENTS - Long-
FAIR VALUE MEASUREMENTS - Long-term Debt (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Carrying Amount | ||
Carrying amount and fair value of financial instruments | ||
Long-term debt, including current maturities | $ 7,531 | $ 8,180 |
Fair Value | Level 2 | ||
Carrying amount and fair value of financial instruments | ||
Long-term debt, including current maturities | $ 6,765.9 | $ 7,552.5 |
DERIVATIVES AND HEDGING TRANS_3
DERIVATIVES AND HEDGING TRANSACTIONS - Derivative Positions Summary (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Asset Derivatives | ||
Gross value of derivatives | $ 54.7 | $ 55.7 |
Gross amounts offset in the Consolidated Balance Sheet | (21) | (28.8) |
Net value of derivatives presented in the Consolidated Balance Sheet | 33.7 | 26.9 |
Liability Derivatives | ||
Gross value of derivatives | 205.3 | 198.4 |
Gross amounts offset in the Consolidated Balance Sheet | (21) | (28.8) |
Net value of derivatives presented in the Consolidated Balance Sheet | 184.3 | 169.6 |
Cash collateral received | 0 | |
Cash collateral pledged | 0 | |
Foreign currency forward contracts | ||
Liability Derivatives | ||
Notional values | 2,978 | 3,745 |
Interest rate swap agreements | ||
Liability Derivatives | ||
Notional values | 1,500 | 1,500 |
Cross-currency swap derivative contracts | ||
Liability Derivatives | ||
Notional values | 976 | 998 |
Derivatives designated as hedging instruments | Foreign currency forward contracts | ||
Asset Derivatives | ||
Gross value of derivatives | 8.6 | 6.7 |
Liability Derivatives | ||
Gross value of derivatives | 2.2 | 5.2 |
Derivatives designated as hedging instruments | Interest rate swap agreements | ||
Liability Derivatives | ||
Gross value of derivatives | 167.6 | 146.5 |
Derivatives designated as hedging instruments | Cross-currency swap derivative contracts | ||
Asset Derivatives | ||
Gross value of derivatives | 33.1 | 29.1 |
Liability Derivatives | ||
Gross value of derivatives | 22.1 | 24.9 |
Derivatives not designated as hedging instruments | Foreign currency forward contracts | ||
Asset Derivatives | ||
Gross value of derivatives | 13 | 19.9 |
Liability Derivatives | ||
Gross value of derivatives | $ 13.4 | $ 21.8 |
DERIVATIVES AND HEDGING TRANS_4
DERIVATIVES AND HEDGING TRANSACTIONS - Information by Type of Derivative and Hedging Activities (Details) € in Millions, ¥ in Millions, $ in Millions | 3 Months Ended | ||||||
Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Mar. 31, 2024 EUR (€) | Mar. 31, 2024 CNY (¥) | Dec. 31, 2023 USD ($) | Oct. 31, 2023 CNY (¥) | Aug. 31, 2023 CNY (¥) | |
Impact on AOCI and earnings from derivative contracts | |||||||
Gain (loss) on derivative recognized in income | $ 5.3 | ||||||
Cash Flow Hedges | |||||||
Maximum period for hedged transactions | 1 year | ||||||
Fair Value Hedges | |||||||
Derivative liability | $ 184.3 | $ 169.6 | |||||
Net Investment Hedges | |||||||
Revaluation (loss) gain, net of tax | 8.9 | (16.7) | |||||
Seven year 2008 senior notes | |||||||
Fair Value Hedges | |||||||
Aggregate principal amount | 1,500 | ||||||
Selling, general and administrative expenses | |||||||
Impact on AOCI and earnings from derivative contracts | |||||||
Gain (loss) on derivative recognized in income | 1.1 | (30.6) | |||||
Interest expense, net | |||||||
Impact on AOCI and earnings from derivative contracts | |||||||
Gain (loss) on derivative recognized in income | (0.5) | 1.5 | |||||
Foreign currency forward contracts | |||||||
Net Investment Hedges | |||||||
Notional values | 2,978 | 3,745 | |||||
Foreign currency forward contracts | Derivatives not designated as hedging instruments | |||||||
Impact on AOCI and earnings from derivative contracts | |||||||
Gain (loss) on derivative recognized in income | $ 0.4 | $ (24.6) | |||||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Selling, General and Administrative Expense | Selling, General and Administrative Expense | |||||
Interest rate swap agreements | |||||||
Net Investment Hedges | |||||||
Notional values | $ 1,500 | 1,500 | |||||
Euro Notes | |||||||
Net Investment Hedges | |||||||
Revaluation (loss) gain, net of tax | 2.5 | $ (15.1) | |||||
Cross-currency swap derivative contracts | |||||||
Net Investment Hedges | |||||||
Notional values | 976 | $ 998 | |||||
Revaluation (loss) gain, net of tax | $ 6.4 | $ (1.6) | |||||
Minimum | |||||||
Impact on AOCI and earnings from derivative contracts | |||||||
Interest rate (as a percent) | 1.30% | 1.30% | 1.30% | ||||
Fair Value Hedges | |||||||
Interest rate (as a percent) | 1.30% | 1.30% | 1.30% | ||||
Maximum | |||||||
Impact on AOCI and earnings from derivative contracts | |||||||
Interest rate (as a percent) | 4.80% | 4.80% | 4.80% | ||||
Fair Value Hedges | |||||||
Interest rate (as a percent) | 4.80% | 4.80% | 4.80% | ||||
Cash Flow Hedges. | Foreign currency forward contracts | Derivatives designated as hedging instruments | |||||||
Impact on AOCI and earnings from derivative contracts | |||||||
Gain (loss) reclassified from AOCI into income (effective portion) | $ 0.7 | ||||||
Derivative Instrument, Gain (Loss) Reclassified from AOCI into Income, Effective Portion, Statement of Income or Comprehensive Income [Extensible Enumeration] | Selling, General and Administrative Expense | Selling, General and Administrative Expense | |||||
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) | $ 5.3 | ||||||
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) | (6) | ||||||
Cash Flow Hedges. | Foreign currency forward contracts | Derivatives designated as hedging instruments | Interest expense, net | |||||||
Impact on AOCI and earnings from derivative contracts | |||||||
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value | 2 | ||||||
Cash Flow Hedges. | Interest rate swap agreements | Derivatives designated as hedging instruments | |||||||
Impact on AOCI and earnings from derivative contracts | |||||||
Gain (loss) reclassified from AOCI into income (effective portion) | $ (0.5) | $ (0.5) | |||||
Derivative Instrument, Gain (Loss) Reclassified from AOCI into Income, Effective Portion, Statement of Income or Comprehensive Income [Extensible Enumeration] | Interest Expense, Net | Interest Expense, Net | |||||
Fair Value Hedges | Interest rate swap agreements | |||||||
Fair Value Hedges | |||||||
Cumulative amount of fair value hedging adjustment | $ (168.7) | $ (153.4) | |||||
Derivative liability | 1,333.6 | $ 1,348.9 | |||||
Net Investment Hedge | Senior euro notes | |||||||
Net Investment Hedges | |||||||
Notional values | 621 | € 575 | |||||
Net Investment Hedge | Cross-currency swap derivative contracts | Euro | |||||||
Net Investment Hedges | |||||||
Notional values | 674 | € 625 | |||||
Net Investment Hedge | Cross-currency swap derivative contracts | CNY | |||||||
Net Investment Hedges | |||||||
Notional values | $ 302 | ¥ 2,192 | ¥ 1,098 | ¥ 1,094 |
OTHER COMPREHENSIVE INCOME (L_3
OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Reclassification adjustments | ||
COS | $ (2,128.1) | $ (2,205.2) |
SG&A | (1,077.7) | (990.3) |
Interest (income) expense, net | (71.6) | (74.2) |
Subtotal | (30.3) | (10.1) |
Derivative (gain) loss reclassified from AOCI into income, net of tax | (0.1) | (0.6) |
Pension and postretirement benefits amortization of net actuarial losses and prior service credits and settlement charges reclassified from AOCI into income, net of tax | 2.3 | 0.2 |
Derivative & Hedging Instruments | ||
Reclassification adjustments | ||
Amount recognized in AOCI | 6.6 | (5.1) |
Other activity | 0.1 | |
Tax impact | (1.3) | 1.1 |
Subtotal | 5.1 | (4.7) |
Derivative & Hedging Instruments | Reclassifications adjustments | ||
Reclassification adjustments | ||
COS | (5.3) | |
SG&A | (0.7) | 6 |
Interest (income) expense, net | 0.5 | (1.5) |
(Gains) losses reclassified from AOCI into income | (0.2) | (0.8) |
Pension & Postretirement Benefits | ||
Reclassification adjustments | ||
(Gains) losses reclassified from AOCI into income | 2.1 | 2.2 |
Other activity | 0.9 | (1.6) |
Tax impact | (0.7) | (0.4) |
Subtotal | 2.3 | 0.2 |
Settlement charge | Reclassifications adjustments | ||
Reclassification adjustments | ||
(Gains) losses reclassified from AOCI into income | 0.4 | 0.6 |
Prior service costs | Reclassifications adjustments | ||
Reclassification adjustments | ||
(Gains) losses reclassified from AOCI into income | $ 1.7 | $ 1.6 |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) - $ / shares | 3 Months Ended | ||||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Nov. 30, 2022 | Feb. 28, 2015 | |
SHAREHOLDERS' EQUITY | |||||
Common stock, par value per share (in dollars per share) | $ 1 | $ 1 | |||
Common Stock, Shares Authorized | 800,000,000 | 800,000,000 | |||
Dividends declared per common share (in dollars per share) | $ 0.57 | $ 0.53 | |||
COMMON STOCK | |||||
SHAREHOLDERS' EQUITY | |||||
Common stock, shares authorized to be repurchased | 10,000,000 | 20,000,000 | |||
Remaining shares authorized to be repurchased | 12,083,711 | ||||
Reacquired shares (in shares) | 921,618 | ||||
Number of shares reacquired through the open market | 833,386 | ||||
Number of shares that have been repurchased through the exercise of stock options and vesting of stock awards | 88,232 | 66,862 |
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 | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Computations of the basic and diluted earnings attributable to Ecolab per share amounts | ||
Net income attributable to Ecolab | $ 412.1 | $ 233.4 |
Weighted-average common shares outstanding | ||
Basic (in shares) | 285.7 | 284.6 |
Effect of dilutive stock options and units (in shares) | 2.1 | 1.3 |
Diluted (in shares) | 287.8 | 285.9 |
Earnings attributable to Ecolab per common share | ||
Basic EPS (in dollars per share) | $ 1.44 | $ 0.82 |
Diluted EPS (in dollars per share) | $ 1.43 | $ 0.82 |
Anti-dilutive securities excluded from the computation of diluted EPS | 2.4 | 4.6 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
INCOME TAXES | ||
Effective income tax rate (as a percent) | 9.20% | 18% |
Recognized discrete tax expense (benefit) | $ 48.2 | $ 4 |
Tax expense, transfer of intangible assets between affiliates | 41.9 | |
Excess tax benefits, share-based compensation | 8.6 | |
Favorable adjustments | $ 2.3 |
PENSION AND POSTRETIREMENT PL_3
PENSION AND POSTRETIREMENT PLANS (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Other Pension Plan Information | ||
Defined benefit plan, tax status extensible enumeration | us-gaap:NonqualifiedPlanMember | |
U.S. Pension. | Pension | ||
Net periodic benefit costs | ||
Service cost | $ 11.6 | $ 10.2 |
Interest cost on benefit obligation | 21.8 | 22 |
Expected return on plan assets | (37.7) | (36.3) |
Recognition of net actuarial loss (gain) | 1.5 | |
Amortization of prior service benefit | (1.1) | (1) |
Curtailments and settlements | 0.4 | 0.7 |
Total expense (benefit) | (3.5) | (4.4) |
Other Pension Plan Information | ||
Contributions to plan | 2 | |
Contributions anticipated to be made during the remainder of 2024 | 7 | |
U.S. Pension. | U.S. Postretirement Benefits | ||
Net periodic benefit costs | ||
Service cost | 0.1 | 0.1 |
Interest cost on benefit obligation | 1.3 | 1.4 |
Recognition of net actuarial loss (gain) | (0.8) | (0.8) |
Curtailments and settlements | (0.1) | |
Total expense (benefit) | 0.6 | 0.6 |
Other Pension Plan Information | ||
Contributions to plan | 3 | |
Contributions anticipated to be made during the remainder of 2024 | 9 | |
International Pension | Pension | ||
Net periodic benefit costs | ||
Service cost | 4.9 | 5.4 |
Interest cost on benefit obligation | 12.4 | 11.4 |
Expected return on plan assets | (12.5) | (13.8) |
Recognition of net actuarial loss (gain) | 2.2 | 3.5 |
Amortization of prior service benefit | (0.1) | (0.1) |
Total expense (benefit) | 6.9 | $ 6.4 |
Other Pension Plan Information | ||
Contributions to plan | 10 | |
Contributions anticipated to be made during the remainder of 2024 | $ 35 |
REVENUES - Operating Lease Reve
REVENUES - Operating Lease Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating Lease, Lease Income | ||
Operating lease revenue | $ 133.2 | $ 126.4 |
REVENUES - Principal Activities
REVENUES - Principal Activities (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Disaggregation of revenue | |||
Net sales | $ 3,751.9 | $ 3,571.6 | |
Allowance for expected return of products | $ 73.5 | $ 71.7 | |
United States | Geographic concentration | Consolidated net sales | |||
Disaggregation of revenue | |||
Percentage of consolidated sales | 54% | ||
Product and equipment sales | |||
Disaggregation of revenue | |||
Net sales | $ 2,986.5 | 2,876.3 | |
Service and lease sales | |||
Disaggregation of revenue | |||
Net sales | 765.4 | 695.3 | |
Operating segment | |||
Disaggregation of revenue | |||
Net sales | 3,761.7 | 3,580.8 | |
Global Industrial | |||
Disaggregation of revenue | |||
Net sales | 1,839.2 | 1,809.1 | |
Global Industrial | United States | |||
Disaggregation of revenue | |||
Net sales | 793.8 | 793 | |
Global Industrial | Europe | |||
Disaggregation of revenue | |||
Net sales | 374.6 | 377.4 | |
Global Industrial | Asia Pacific | |||
Disaggregation of revenue | |||
Net sales | 230.7 | 228.4 | |
Global Industrial | Latin America | |||
Disaggregation of revenue | |||
Net sales | 189.6 | 158.2 | |
Global Industrial | Greater China | |||
Disaggregation of revenue | |||
Net sales | 97.7 | 96.9 | |
Global Industrial | India, Middle East and Africa | |||
Disaggregation of revenue | |||
Net sales | 99.2 | 104.4 | |
Global Industrial | Canada | |||
Disaggregation of revenue | |||
Net sales | 53.6 | 50.8 | |
Global Industrial | Product and equipment sales | |||
Disaggregation of revenue | |||
Net sales | 1,612.5 | 1,592.3 | |
Global Industrial | Service and lease sales | |||
Disaggregation of revenue | |||
Net sales | 226.7 | 216.8 | |
Global Industrial | Operating segment | |||
Disaggregation of revenue | |||
Net sales | 1,841.7 | 1,808.2 | |
Global Institutional and Specialty | |||
Disaggregation of revenue | |||
Net sales | 1,266.7 | 1,128.8 | |
Global Institutional and Specialty | United States | |||
Disaggregation of revenue | |||
Net sales | 883.2 | 786 | |
Global Institutional and Specialty | Europe | |||
Disaggregation of revenue | |||
Net sales | 160.5 | 146.5 | |
Global Institutional and Specialty | Asia Pacific | |||
Disaggregation of revenue | |||
Net sales | 59.3 | 56.8 | |
Global Institutional and Specialty | Latin America | |||
Disaggregation of revenue | |||
Net sales | 49.9 | 41.3 | |
Global Institutional and Specialty | Greater China | |||
Disaggregation of revenue | |||
Net sales | 44.7 | 35.6 | |
Global Institutional and Specialty | India, Middle East and Africa | |||
Disaggregation of revenue | |||
Net sales | 15.5 | 14.7 | |
Global Institutional and Specialty | Canada | |||
Disaggregation of revenue | |||
Net sales | 53.6 | 47.9 | |
Global Institutional and Specialty | Product and equipment sales | |||
Disaggregation of revenue | |||
Net sales | 1,021.4 | 920.8 | |
Global Institutional and Specialty | Service and lease sales | |||
Disaggregation of revenue | |||
Net sales | 245.3 | 208 | |
Global Institutional and Specialty | Operating segment | |||
Disaggregation of revenue | |||
Net sales | 1,270.3 | 1,131.2 | |
Global Healthcare and Life Sciences | |||
Disaggregation of revenue | |||
Net sales | 379.9 | 379.7 | |
Global Healthcare and Life Sciences | United States | |||
Disaggregation of revenue | |||
Net sales | 149.8 | 162.5 | |
Global Healthcare and Life Sciences | Europe | |||
Disaggregation of revenue | |||
Net sales | 184.5 | 174.4 | |
Global Healthcare and Life Sciences | Asia Pacific | |||
Disaggregation of revenue | |||
Net sales | 23.4 | 19.6 | |
Global Healthcare and Life Sciences | Latin America | |||
Disaggregation of revenue | |||
Net sales | 5.5 | 5.7 | |
Global Healthcare and Life Sciences | Greater China | |||
Disaggregation of revenue | |||
Net sales | 9.4 | 10.8 | |
Global Healthcare and Life Sciences | India, Middle East and Africa | |||
Disaggregation of revenue | |||
Net sales | 5.4 | 5.3 | |
Global Healthcare and Life Sciences | Canada | |||
Disaggregation of revenue | |||
Net sales | 1.9 | 1.4 | |
Global Healthcare and Life Sciences | Product and equipment sales | |||
Disaggregation of revenue | |||
Net sales | 352.6 | 352.6 | |
Global Healthcare and Life Sciences | Service and lease sales | |||
Disaggregation of revenue | |||
Net sales | 27.3 | 27.1 | |
Global Healthcare and Life Sciences | Operating segment | |||
Disaggregation of revenue | |||
Net sales | 382.9 | 386.1 | |
Global Pest Elimination | |||
Disaggregation of revenue | |||
Net sales | 266.1 | 243.4 | |
Global Pest Elimination | United States | |||
Disaggregation of revenue | |||
Net sales | 181.7 | 165.9 | |
Global Pest Elimination | Europe | |||
Disaggregation of revenue | |||
Net sales | 43.2 | 38.7 | |
Global Pest Elimination | Asia Pacific | |||
Disaggregation of revenue | |||
Net sales | 7.6 | 6.9 | |
Global Pest Elimination | Latin America | |||
Disaggregation of revenue | |||
Net sales | 14.5 | 13.6 | |
Global Pest Elimination | Greater China | |||
Disaggregation of revenue | |||
Net sales | 14.7 | 14 | |
Global Pest Elimination | India, Middle East and Africa | |||
Disaggregation of revenue | |||
Net sales | 1.7 | 1.9 | |
Global Pest Elimination | Canada | |||
Disaggregation of revenue | |||
Net sales | 2.7 | 2.4 | |
Global Pest Elimination | Service and lease sales | |||
Disaggregation of revenue | |||
Net sales | 266.1 | 243.4 | |
Global Pest Elimination | Operating segment | |||
Disaggregation of revenue | |||
Net sales | $ 266.8 | 244.6 | |
Corporate | |||
Disaggregation of revenue | |||
Net sales | 10.6 | ||
Corporate | United States | |||
Disaggregation of revenue | |||
Net sales | 9.6 | ||
Corporate | Europe | |||
Disaggregation of revenue | |||
Net sales | 0.7 | ||
Corporate | Latin America | |||
Disaggregation of revenue | |||
Net sales | 0.3 | ||
Corporate | Product and equipment sales | |||
Disaggregation of revenue | |||
Net sales | $ 10.6 |
REVENUES - Allowance for Expect
REVENUES - Allowance for Expected Credit Losses (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Accounts Receivable and Allowance for Doubtful Accounts | |||
Allowance for doubtful accounts, returns and credits | $ 73.5 | $ 71.7 | |
Activity in the allowance for doubtful accounts | |||
Beginning balance | 77.3 | $ 71.9 | |
Bad debt expense | 13.2 | 14.7 | |
Write-offs | (10.6) | (7.9) | |
Other (a) | (0.9) | (1.3) | |
Ending balance | $ 79 | $ 77.4 |
REVENUES - Contract Liability (
REVENUES - Contract Liability (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Change in contract liability | ||
Contract liability as of beginning of the year | $ 110.9 | $ 116.5 |
Revenue recognized in the period from: Amounts included in the contract liability at the beginning of the period | (110.9) | (116.5) |
Increases due to billings excluding amounts recognized as revenue during the period ended | 118 | 107.5 |
Contract liability as of end of period | $ 118 | $ 107.5 |
OPERATING SEGMENTS (Details)
OPERATING SEGMENTS (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Mar. 31, 2024 USD ($) | Mar. 31, 2024 segment | Mar. 31, 2024 item | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Financial information of reportable segments | |||||
Number of operating units | 8 | 8 | |||
Number of reportable segments | item | 4 | ||||
Net sales | $ 3,751.9 | $ 3,571.6 | |||
Operating Income (Loss) | 517.9 | 351.6 | |||
Previously Reported | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | $ 15,320.2 | ||||
Operating Income (Loss) | 1,992.3 | ||||
Previously Reported | Valued at 2024 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 15,320.2 | ||||
Operating Income (Loss) | 1,992.3 | ||||
Global Industrial | |||||
Financial information of reportable segments | |||||
Net sales | 1,839.2 | 1,809.1 | |||
Global Institutional and Specialty | |||||
Financial information of reportable segments | |||||
Net sales | 1,266.7 | 1,128.8 | |||
Global Healthcare and Life Sciences | |||||
Financial information of reportable segments | |||||
Net sales | 379.9 | 379.7 | |||
Global Pest Elimination | |||||
Financial information of reportable segments | |||||
Net sales | 266.1 | 243.4 | |||
Corporate | |||||
Financial information of reportable segments | |||||
Net sales | 10.6 | ||||
Operating segment | |||||
Financial information of reportable segments | |||||
Net sales | 3,761.7 | 3,580.8 | |||
Operating Income (Loss) | 519 | 352.4 | |||
Operating segment | Previously Reported | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 15,275.4 | ||||
Operating Income (Loss) | 1,987 | ||||
Operating segment | Previously Reported | Valued at 2024 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 15,375.5 | ||||
Operating Income (Loss) | 2,002.2 | ||||
Operating segment | Purchase Price Adjustments | Changes in Currency Rates | |||||
Financial information of reportable segments | |||||
Net sales | 100.1 | ||||
Operating Income (Loss) | 15.2 | ||||
Operating segment | Global Industrial | |||||
Financial information of reportable segments | |||||
Net sales | 1,841.7 | 1,808.2 | |||
Operating Income (Loss) | 265 | 219.8 | |||
Operating segment | Global Industrial | Previously Reported | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 7,193.1 | ||||
Operating Income (Loss) | 1,080.7 | ||||
Operating segment | Global Industrial | Previously Reported | Valued at 2024 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 7,640.5 | ||||
Operating Income (Loss) | 1,122 | ||||
Operating segment | Global Industrial | Purchase Price Adjustments | Changes in Currency Rates | |||||
Financial information of reportable segments | |||||
Net sales | 40.1 | ||||
Operating Income (Loss) | 2.3 | ||||
Operating segment | Global Industrial | Purchase Price Adjustments | Segment Changes | |||||
Financial information of reportable segments | |||||
Net sales | 407.3 | ||||
Operating Income (Loss) | 39 | ||||
Operating segment | Global Institutional and Specialty | |||||
Financial information of reportable segments | |||||
Net sales | 1,270.3 | 1,131.2 | |||
Operating Income (Loss) | 248 | 130.1 | |||
Operating segment | Global Institutional and Specialty | Previously Reported | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 4,994 | ||||
Operating Income (Loss) | 823 | ||||
Operating segment | Global Institutional and Specialty | Previously Reported | Valued at 2024 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 5,014.6 | ||||
Operating Income (Loss) | 841.8 | ||||
Operating segment | Global Institutional and Specialty | Purchase Price Adjustments | Changes in Currency Rates | |||||
Financial information of reportable segments | |||||
Net sales | 20.6 | ||||
Operating Income (Loss) | 3.9 | ||||
Operating segment | Global Institutional and Specialty | Purchase Price Adjustments | Segment Changes | |||||
Financial information of reportable segments | |||||
Operating Income (Loss) | 14.9 | ||||
Operating segment | Global Healthcare and Life Sciences | |||||
Financial information of reportable segments | |||||
Net sales | 382.9 | 386.1 | |||
Operating Income (Loss) | 37 | 35.4 | |||
Operating segment | Global Healthcare and Life Sciences | Previously Reported | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 1,576.9 | ||||
Operating Income (Loss) | 160 | ||||
Operating segment | Global Healthcare and Life Sciences | Previously Reported | Valued at 2024 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 1,607.5 | ||||
Operating Income (Loss) | 160.8 | ||||
Operating segment | Global Healthcare and Life Sciences | Purchase Price Adjustments | Changes in Currency Rates | |||||
Financial information of reportable segments | |||||
Net sales | 30.6 | ||||
Operating Income (Loss) | 7.5 | ||||
Operating segment | Global Healthcare and Life Sciences | Purchase Price Adjustments | Segment Changes | |||||
Financial information of reportable segments | |||||
Operating Income (Loss) | (6.7) | ||||
Operating segment | Global Pest Elimination | |||||
Financial information of reportable segments | |||||
Net sales | 266.8 | 244.6 | |||
Operating Income (Loss) | 48.8 | 44.5 | |||
Operating segment | Global Pest Elimination | Previously Reported | Valued at 2024 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 1,070.2 | ||||
Operating Income (Loss) | 210.4 | ||||
Operating segment | Global Pest Elimination | Purchase Price Adjustments | Changes in Currency Rates | |||||
Financial information of reportable segments | |||||
Net sales | 8.7 | ||||
Operating Income (Loss) | 1.4 | ||||
Operating segment | Global Pest Elimination | Purchase Price Adjustments | Segment Changes | |||||
Financial information of reportable segments | |||||
Net sales | 1,061.5 | ||||
Operating Income (Loss) | 209 | ||||
Operating segment | Other | Previously Reported | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 1,442.3 | ||||
Operating Income (Loss) | 255 | ||||
Operating segment | Other | Purchase Price Adjustments | Segment Changes | |||||
Financial information of reportable segments | |||||
Net sales | (1,442.3) | ||||
Operating Income (Loss) | (255) | ||||
Operating segment | Corporate | |||||
Financial information of reportable segments | |||||
Operating Income (Loss) | (79.8) | (77.4) | |||
Operating segment | Corporate | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 10.7 | ||||
Operating segment | Corporate | Previously Reported | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 69.1 | ||||
Operating Income (Loss) | (331.7) | ||||
Operating segment | Corporate | Previously Reported | Valued at 2024 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 42.7 | ||||
Operating Income (Loss) | (332.8) | ||||
Operating segment | Corporate | Purchase Price Adjustments | Changes in Currency Rates | |||||
Financial information of reportable segments | |||||
Net sales | 0.1 | ||||
Operating Income (Loss) | 0.1 | ||||
Operating segment | Corporate | Purchase Price Adjustments | Segment Changes | |||||
Financial information of reportable segments | |||||
Net sales | (26.5) | ||||
Operating Income (Loss) | (1.2) | ||||
Currency impact | |||||
Financial information of reportable segments | |||||
Net sales | (9.8) | (9.2) | |||
Operating Income (Loss) | $ (1.1) | $ (0.8) | |||
Currency impact | Previously Reported | Valued at 2023 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | 44.8 | ||||
Operating Income (Loss) | 5.3 | ||||
Currency impact | Previously Reported | Valued at 2024 Management Rates | |||||
Financial information of reportable segments | |||||
Net sales | (55.3) | ||||
Operating Income (Loss) | (9.9) | ||||
Currency impact | Purchase Price Adjustments | Changes in Currency Rates | |||||
Financial information of reportable segments | |||||
Net sales | (100.1) | ||||
Operating Income (Loss) | $ (15.2) |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 location plaintiff | Jun. 01, 2022 USD ($) | |
Loss contingencies | ||
Estimated settlement | $ 500 | |
Environmental matters | ||
Number of locations for environmental assessments and remediation | location | 25 | |
Nalco Holding Company ("Nalco") | ||
Loss contingencies | ||
Estimated settlement | 30 | |
Number of plaintiffs having claims | plaintiff | 5,000 | |
Maximum | Nalco Holding Company ("Nalco") | ||
Loss contingencies | ||
Estimated possible loss | 520 | |
Minimum | Nalco Holding Company ("Nalco") | ||
Loss contingencies | ||
Estimated possible loss | $ 152 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Apr. 27, 2024 USD ($) |
Subsequent event | Global Surgical Business | |
Subsequent Event [Line Items] | |
Total Consideration | $ 950 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ 412.1 | $ 233.4 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Rule10b51ArrModified [Flag] | false |