Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Billions, except Share data, unless otherwise specified | Sep. 30, 2014 | Nov. 12, 2014 | Mar. 31, 2014 |
Document And Entity Information Abstract | ' | ' | ' |
Document Type | '10-K | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 30-Sep-14 | ' | ' |
Entity Registrant Name | 'Hill-Rom Holdings, Inc. | ' | ' |
Entity Central Index Key | '0000047518 | ' | ' |
Current Fiscal Year End Date | '--09-30 | ' | ' |
Document Fiscal Year Focus | '2014 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
Entity Filer Category | 'Large Accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 57,518,884 | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Public Float | ' | ' | $2.20 |
STATEMENTS_OF_CONSOLIDATED_INC
STATEMENTS OF CONSOLIDATED INCOME (USD $) | 12 Months Ended | ||
In Millions, except Share data in Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Net Revenue | ' | ' | ' |
Capital sales | $1,301.40 | $1,308.30 | $1,198.20 |
Rental revenue | 384.7 | 407.9 | 436.1 |
Total revenue | 1,686.10 | 1,716.20 | 1,634.30 |
Cost of Revenue | ' | ' | ' |
Cost of goods sold | 730.2 | 747.8 | 690.4 |
Rental expenses | 176 | 188.1 | 189.2 |
Total cost of revenue | 906.2 | 935.9 | 879.6 |
Gross Profit | 779.9 | 780.3 | 754.7 |
Research and development expenses | 71.9 | 70.2 | 66.9 |
Selling and administrative expenses | 548.3 | 549.5 | 496.4 |
Litigation credit (Note 13) | ' | ' | -3.6 |
Impairment of other intangibles (Note 3) | ' | ' | 8 |
Special charges (Note 8) | 37.1 | 5.7 | 18.2 |
Operating Profit | 122.6 | 154.9 | 168.8 |
Interest expense | -9.8 | -9.5 | -6.5 |
Investment income and other, net | 2.4 | -1.4 | 1.2 |
Income Before Income Taxes | 115.2 | 144 | 163.5 |
Income tax expense (Note 9) | 54.6 | 39 | 42.7 |
Net Income | $60.60 | $105 | $120.80 |
Net income per Common Share - Basic | $1.05 | $1.75 | $1.94 |
Net income per Common Share - Diluted | $1.04 | $1.74 | $1.94 |
Dividends per Common Share | $0.60 | $0.53 | $0.49 |
Average Common Shares Outstanding - Basic (thousands) (Note 10) | 57,555 | 59,910 | 62,120 |
Average Common Shares Outstanding - Diluted (thousands) (Note 10) | 58,523 | 60,250 | 62,361 |
STATEMENTS_OF_CONSOLIDATED_COM
STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME | ' | ' | ' |
Net Income | $60.60 | $105 | $120.80 |
Other Comprehensive Income (Loss): | ' | ' | ' |
Available-for-sale securities and currency hedges, net of tax of ($0.1), $0.0, and ($0.2), respectively | 0.3 | 0.1 | 0.5 |
Foreign currency translation adjustment, net of tax of $0.0, $0.0, and $1.8, respectively | -29.6 | 12.6 | -1.5 |
Items not yet recognized as a component of net periodic pension and postretirement healthcare costs, net of tax of $5.0, ($18.1), and ($1.6), respectively | -9.1 | 29.6 | 2 |
Total Other Comprehensive Income (Loss) | -38.4 | 42.3 | 1 |
Total Comprehensive Income | $22.20 | $147.30 | $121.80 |
STATEMENTS_OF_CONSOLIDATED_COM1
STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (Parenthetical) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME | ' | ' | ' |
Available-for-sale securities and currency hedges, tax effect | ($0.10) | $0 | ($0.20) |
Foreign currency translation adjustment, tax effect | 0 | 0 | 1.8 |
Items not yet recognized as a component of net periodic pension and postretirement healthcare costs, tax effect | $5 | ($18.10) | ($1.60) |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Millions, unless otherwise specified | ||
Current Assets | ' | ' |
Cash and cash equivalents | $99.30 | $127.40 |
Trade accounts receivable, less allowances of $31.4 in 2014 and $30.1 in 2013 (Note 1) | 411 | 361.8 |
Inventories (Note 1) | 176.2 | 118.3 |
Deferred income taxes (Notes 1 and 9) | 40.9 | 48.2 |
Other current assets | 51.9 | 32.3 |
Total current assets | 779.3 | 688 |
Property, plant and equipment (Note 1) | 849.6 | 821.7 |
Less accumulated depreciation | -588.1 | -587.4 |
Property, plant and equipment, net | 261.5 | 234.3 |
Intangible assets: | ' | ' |
Goodwill (Notes 1, 2 and 3) | 399.8 | 342.8 |
Software and other, net (Notes 1 and 2) | 261.1 | 252.7 |
Deferred income taxes (Notes 1 and 9) | 23 | 37.5 |
Other assets | 27.4 | 31.5 |
Total Assets | 1,752.10 | 1,586.80 |
Current Liabilities | ' | ' |
Trade accounts payable | 112.7 | 80.8 |
Short-term borrowings (Note 4) | 126.9 | 81.2 |
Accrued compensation | 89.2 | 92.4 |
Accrued product warranties (Note 1) | 28.4 | 38.1 |
Other current liabilities | 85.1 | 52.9 |
Total current liabilities | 442.3 | 345.4 |
Long-term debt (Note 4) | 364.9 | 225.8 |
Accrued pension and postretirement benefits (Note 6) | 76.9 | 52.6 |
Deferred income taxes (Notes 1 and 9) | 31 | 67 |
Other long-term liabilities | 30.5 | 37.3 |
Total Liabilities | 945.6 | 728.1 |
Commitments and Contingencies (Note 13) | ' | ' |
SHAREHOLDERS' EQUITY (Note 7) | ' | ' |
Preferred stock - without par value: Authorized - 1,000,000 shares; none issued or outstanding | ' | ' |
Common stock - without par value: Authorized - 199,000,000 Issued - 80,323,912 shares in 2014 and 2013 | 4.4 | 4.4 |
Additional paid-in-capital | 134.1 | 122.7 |
Retained earnings | 1,499.80 | 1,473.80 |
Accumulated other comprehensive loss (Note 1) | -74.1 | -35.7 |
Treasury stock, common shares at cost: 2014 - 22,884,001 and 2013 - 21,800,520 | -757.7 | -706.5 |
Total Shareholders' Equity | 806.5 | 858.7 |
Total Liabilities and Shareholders' Equity | $1,752.10 | $1,586.80 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Millions, except Share data, unless otherwise specified | ||
CONSOLIDATED BALANCE SHEETS [Abstract] | ' | ' |
Trade accounts receivable, allowances | $31.40 | $30.10 |
Preferred stock, no par value | ' | ' |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, no par value | ' | ' |
Common stock, shares authorized | 199,000,000 | 199,000,000 |
Common stock, shares issued | 80,323,912 | 80,323,912 |
Treasury stock, shares | 22,884,001 | 21,800,520 |
STATEMENTS_OF_CONSOLIDATED_CAS
STATEMENTS OF CONSOLIDATED CASH FLOWS (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Operating Activities | ' | ' | ' |
Net income | $60.60 | $105 | $120.80 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | ' |
Depreciation | 65.4 | 71.2 | 73.9 |
Amortization | 12.2 | 17.9 | 21.3 |
Acquisition-related intangible asset amortization | 28.8 | 27.7 | 16.5 |
Provision for deferred income taxes | 3.9 | -14.8 | -32.3 |
Loss on disposal of property, equipment leased to others, intangible assets and impairments | 7.2 | 1.5 | 8.1 |
Stock compensation | 18 | 13.5 | 11.6 |
Excess tax benefits from employee stock plans | 0.3 | -0.3 | -1.3 |
Change in working capital excluding cash, current investments, current debt, acquisitions and dispositions: | ' | ' | ' |
Trade accounts receivable | 17.1 | 30.8 | 20.1 |
Inventories | 9.1 | 8.4 | 4.4 |
Other current assets | -2.6 | -6.5 | 20.9 |
Trade accounts payable | 7 | 0.1 | 0.3 |
Accrued expenses and other liabilities | -12.5 | -0.2 | -6.1 |
Other, net | -4.2 | 8.9 | 3.5 |
Net cash provided by operating activities | 210.3 | 263.2 | 261.7 |
Investing Activities | ' | ' | ' |
Capital expenditures and purchase of intangible assets | -62.7 | -65.3 | -77.8 |
Proceeds on sales of property and equipment leased to others | 2.4 | 5.9 | 10.6 |
Payment for acquisition of businesses, net of cash acquired | -239.5 | ' | -476.8 |
Refund on acquisition of businesses | 4.6 | 0.8 | ' |
Other | 0.7 | ' | 4.5 |
Net cash used in investing activities | -294.5 | -58.6 | -539.5 |
Financing Activities | ' | ' | ' |
Net change in short-term debt | -0.2 | ' | -7.8 |
Borrowings on revolving credit facility | 252 | ' | 305 |
Payments on revolving credit facility | -57 | -35 | -245 |
Proceeds from long-term debt | 0.8 | ' | 200 |
Payment of long-term debt | -11.4 | -10.1 | -50 |
Payment of acquired debt | -26.8 | ' | ' |
Debt issuance costs | ' | ' | -2.6 |
Purchase of noncontrolling interest | -1.3 | -1.6 | -1.6 |
Payment of cash dividends | -34.2 | -31.2 | -30.1 |
Proceeds from exercise of stock options | 11.5 | 7.6 | 7.7 |
Proceeds from stock issuance | 2.5 | 2.5 | 2.9 |
Excess tax benefits from employee stock plans | -0.3 | 0.3 | 1.3 |
Treasury stock acquired | -71.8 | -94 | -44.2 |
Net cash provided by (used in) financing activities | 63.8 | -161.5 | 135.6 |
Effect of exchange rate changes on cash | -7.7 | ' | 1.9 |
Net Cash Flows | -28.1 | 43.1 | -140.3 |
Cash and Cash Equivalents | ' | ' | ' |
At beginning of period | 127.4 | 84.3 | 224.6 |
At end of period | 99.3 | 127.4 | 84.3 |
Supplemental cash flow information: | ' | ' | ' |
Cash paid for income taxes | 44.4 | 68.1 | 52.1 |
Cash paid for interest | 7.8 | 7.5 | 6.6 |
Non-cash financing activities: | ' | ' | ' |
Treasury stock issued under stock compensation plans | $20.60 | $18.40 | $21 |
STATEMENTS_OF_CONSOLIDATED_SHA
STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY (USD $) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Common Stock in Treasury [Member] |
In Millions, except Share data | ||||||
Balance at Sep. 30, 2011 | $741.70 | $4.40 | $114.10 | $1,309.80 | ($79) | ($607.60) |
Balance, shares at Sep. 30, 2011 | ' | 61,686,372 | ' | ' | ' | -18,637,540 |
Net income | 120.8 | ' | ' | 120.8 | ' | ' |
Other comprehensive income (loss) net of tax of $0.0, ($18.1) and $4.9 in 2012, 2013, and 2014 | 1 | ' | ' | ' | 1 | ' |
Dividends | -30.1 | ' | 0.2 | -30.3 | ' | ' |
Treasury shares acquired | -44.2 | ' | ' | ' | ' | -44.2 |
Treasury shares acquired, shares | ' | -1,532,232 | ' | ' | ' | 1,532,232 |
Stock awards and option exercises | 23.4 | ' | 2.5 | ' | ' | 20.9 |
Stock awards and option exercises, shares | ' | 642,783 | ' | ' | ' | -642,783 |
Balance at Sep. 30, 2012 | 812.6 | 4.4 | 116.8 | 1,400.30 | -78 | -630.9 |
Balance, shares at Sep. 30, 2012 | ' | 60,796,923 | ' | ' | ' | -19,526,989 |
Net income | 105 | ' | ' | 105 | ' | ' |
Other comprehensive income (loss) net of tax of $0.0, ($18.1) and $4.9 in 2012, 2013, and 2014 | 42.3 | ' | ' | ' | 42.3 | ' |
Dividends | -31.2 | ' | 0.3 | -31.5 | ' | ' |
Treasury shares acquired | -94 | ' | ' | ' | ' | -94 |
Treasury shares acquired, shares | ' | -2,844,765 | ' | ' | ' | 2,844,765 |
Stock awards and option exercises | 24 | ' | 5.6 | ' | ' | 18.4 |
Stock awards and option exercises, shares | ' | 571,234 | ' | ' | ' | -571,234 |
Balance at Sep. 30, 2013 | 858.7 | 4.4 | 122.7 | 1,473.80 | -35.7 | -706.5 |
Balance, shares at Sep. 30, 2013 | 80,323,912 | 58,523,392 | ' | ' | ' | -21,800,520 |
Net income | 60.6 | ' | ' | 60.6 | ' | ' |
Other comprehensive income (loss) net of tax of $0.0, ($18.1) and $4.9 in 2012, 2013, and 2014 | -38.4 | ' | ' | ' | -38.4 | ' |
Dividends | -34.2 | ' | 0.4 | -34.6 | ' | ' |
Treasury shares acquired | -71.8 | ' | ' | ' | ' | -71.8 |
Treasury shares acquired, shares | ' | -1,709,523 | ' | ' | ' | 1,709,523 |
Stock awards and option exercises | 31.6 | ' | 11 | ' | ' | 20.6 |
Stock awards and option exercises, shares | ' | 626,042 | ' | ' | ' | -626,042 |
Balance at Sep. 30, 2014 | $806.50 | $4.40 | $134.10 | $1,499.80 | ($74.10) | ($757.70) |
Balance, shares at Sep. 30, 2014 | 80,323,912 | 57,439,911 | ' | ' | ' | -22,884,001 |
STATEMENTS_OF_CONSOLIDATED_SHA1
STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY (Parenthetical) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
STATEMENTS OF CONSOLIDATED SHAREHOLDERS' EQUITY [Abstract] | ' | ' | ' |
Comprehensive income, tax effect | $4.90 | ($18.10) | $0 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ' | ||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ' | ||||||||||||||||
Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||||||
Nature of Operations | |||||||||||||||||
Hill-Rom Holdings, Inc. (the “Company,” “Hill-Rom,” “we,” “us,” or “our”) was incorporated on August 7, 1969 in the State of Indiana and is headquartered in Batesville, Indiana. We are a leading global medical technology company with more than 7,000 employees worldwide. We partner with health care providers in more than 100 countries by focusing on patient care solutions that improve clinical and economic outcomes in five core areas: Advancing Mobility, Wound Care and Prevention, Clinical Workflow, Surgical Safety and Efficiency, and Respiratory Health. Around the world, Hill-Rom's people, products, and programs work towards one mission: Enhancing outcomes for patients and their caregivers. | |||||||||||||||||
Basis of Presentation and Principles of Consolidation | |||||||||||||||||
The Consolidated Financial Statements include the accounts of Hill-Rom and its subsidiaries. All subsidiaries are wholly-owned as of September 30, 2014. Intercompany accounts and transactions have been eliminated in consolidation and certain prior year amounts have been reclassified to conform to current year presentation. | |||||||||||||||||
Use of Estimates | |||||||||||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. Examples of such estimates include our accounts receivable reserves (Note 1), accrued warranties (Note 1), the impairment of intangibles and goodwill (Note 3), income taxes (Notes 1 and 9) and commitments and contingencies (Note 13), among others. | |||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||
We consider investments in marketable securities and other highly liquid instruments with a maturity of three months or less at date of purchase to be cash equivalents. Investments which have no stated maturity are also considered cash equivalents. All of our marketable securities may be freely traded. | |||||||||||||||||
Trade Accounts Receivable | |||||||||||||||||
Trade accounts receivable are recorded at the invoiced amount and do not bear interest, unless the transaction is an installment sale with payment terms exceeding one year. Reserves for uncollectible accounts represent our best estimate of the amount of probable credit losses and collection risk in our existing accounts receivable. We determine such reserves based on historical write-off experience by industry and reimbursement platform. Receivables are generally reviewed on a pooled basis based on historical collection experience for each reimbursement and receivable type. Receivables for capital sales transactions are also reviewed individually for collectability. Account balances are charged against the allowance when we believe it is probable the receivable will not be recovered. We do not have any off-balance sheet credit exposure related to our customers. If circumstances change, such as higher than expected claims denials, payment defaults, changes in our business composition or processes, adverse changes in general economic conditions, unfavorable impacts of austerity measures initiated by some governmental authorities, instability or disruption of credit markets, or an unexpected material adverse change in a major customer's or payor's ability to meet its obligations, our estimates of the realizability of trade receivables could be reduced by a material amount. | |||||||||||||||||
Within rental revenue, the domestic third-party payors' reimbursement process requires extensive documentation, which has had the effect of slowing both the billing and cash collection cycles relative to the rest of the business, and therefore, increasing total accounts receivable. Because of the extensive documentation required and the requirement to settle a claim with the primary payor prior to billing the secondary and/or patient portion of the claim, the collection period for a claim in a portion of our business may, in some cases, be extended. | |||||||||||||||||
We generally hold our trade accounts receivable until they are paid. Certain long-term receivables are occasionally sold to third parties; however, any recognized gain or loss on such sales has historically not been material. | |||||||||||||||||
Inventories | |||||||||||||||||
Inventories are valued at the lower of cost or market. Inventory costs are determined by the last-in, first-out (“LIFO”) method for approximately 36 and 47 percent of our inventories at September 30, 2014 and 2013. Costs for other inventories have been determined principally by the first-in, first-out (“FIFO”) method. Inventories consist of the following: | |||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Finished products | $ | 93.5 | $ | 66.3 | |||||||||||||
Work in process | 17.3 | 5.8 | |||||||||||||||
Raw materials | 65.4 | 46.2 | |||||||||||||||
Total | $ | 176.2 | $ | 118.3 | |||||||||||||
If the FIFO method of inventory accounting, which approximates current cost, had been used for all inventories, they would have been approximately $4.0 million and $3.2 million higher than reported at September 30, 2014 and 2013. | |||||||||||||||||
Property, Plant and Equipment | |||||||||||||||||
Property, plant and equipment is recorded at cost and depreciated over the estimated useful life of the assets using principally the straight-line method. Ranges of estimated useful lives are as follows: | |||||||||||||||||
Useful Life | |||||||||||||||||
Land improvements | 6 - 15 years | ||||||||||||||||
Buildings and building equipment | 10 - 40 years | ||||||||||||||||
Machinery and equipment | 3 - 10 years | ||||||||||||||||
Equipment leased to others | 2 -10 years | ||||||||||||||||
When property, plant and equipment is retired from service or otherwise disposed of, the cost and related amount of depreciation or amortization are eliminated from the asset and accumulated depreciation accounts. The difference, if any, between the net asset value and the proceeds on sale are charged or credited to income. Total depreciation expense for fiscal years 2014, 2013 and 2012 was $65.4 million, $71.2 million and $73.9 million. The major components of property and the related accumulated depreciation were as follows: | |||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Accumulated | Accumulated | ||||||||||||||||
Cost | Depreciation | Cost | Depreciation | ||||||||||||||
Land and land improvements | $ | 19.4 | $ | 2.3 | $ | 14 | $ | 2.1 | |||||||||
Buildings and building equipment | 158.3 | 88.6 | 143.1 | 84.6 | |||||||||||||
Machinery and equipment | 321.3 | 213.7 | 288 | 198.8 | |||||||||||||
Equipment leased to others | 350.6 | 283.5 | 376.6 | 301.9 | |||||||||||||
Total | $ | 849.6 | $ | 588.1 | $ | 821.7 | $ | 587.4 | |||||||||
Intangible Assets | |||||||||||||||||
Intangible assets are stated at cost and consist predominantly of goodwill, software, patents, trademarks, and acquired customer relationship assets. With the exception of goodwill and certain trademarks, our intangible assets are amortized on a straight-line basis over periods generally ranging from 3 to 20 years. | |||||||||||||||||
We assess the carrying value of goodwill and non-amortizable intangibles annually, during the third quarter of each fiscal year, or more often if events or changes in circumstances indicate there may be impairment. Goodwill is allocated among the reporting units based on the relative fair value of those units. | |||||||||||||||||
The majority of our goodwill and many of our intangible assets are not deductible for income tax purposes. A summary of intangible assets and the related accumulated amortization and impairment losses follows: | |||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Amortization | Amortization | ||||||||||||||||
Cost | and Impairment | Cost | and Impairment | ||||||||||||||
Goodwill | $ | 872.6 | $ | 472.8 | $ | 815.6 | $ | 472.8 | |||||||||
Software | 170.5 | 146.6 | 164.6 | 135.9 | |||||||||||||
Other | 373.9 | 136.7 | 336.4 | 112.4 | |||||||||||||
Total | $ | 1,417.00 | $ | 756.1 | $ | 1,316.60 | $ | 721.1 | |||||||||
Amortization expense for fiscal years 2014, 2013 and 2012 was $41.0 million, $45.6 million and $37.8 million. Amortization expense for all intangibles is expected to approximate the following for each of the next five fiscal years and thereafter: | |||||||||||||||||
Amount | |||||||||||||||||
2015 | $ | 40.9 | |||||||||||||||
2016 | $ | 38.3 | |||||||||||||||
2017 | $ | 28.5 | |||||||||||||||
2018 | $ | 23.8 | |||||||||||||||
2019 | $ | 18.8 | |||||||||||||||
2020 and beyond | $ | 77.9 | |||||||||||||||
Software consists mainly of capitalized costs associated with internal use software, including applicable costs associated with the implementation/upgrade of our Enterprise Resource Planning system. In addition, software includes capitalized development costs for software products to be sold. The net book value of computer software costs, included within intangible assets, was $23.9 million and $28.7 million at September 30, 2014 and 2013. Capitalized software costs are amortized on a straight-line basis over periods ranging from three to ten years. Software amortization expense approximated $11.5 million, $17.8 million and $20.7 million for fiscal years 2014, 2013 and 2012, and is included in the total intangibles amortization presented earlier. | |||||||||||||||||
Fair Value Measurements | |||||||||||||||||
Fair value measurements are classified and disclosed in one of the following three categories: | |||||||||||||||||
| Level 1: Financial instruments with unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets and liabilities. | ||||||||||||||||
| Level 2: Financial instruments with observable inputs other than those included in Level 1 such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||||||
| Level 3: Financial instruments with unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Unobservable inputs reflect our own assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). Unobservable inputs shall be developed based on the best information available in the circumstances, which might include our own data. | ||||||||||||||||
We record cash and cash equivalents, as disclosed on our Consolidated Balance Sheets, as Level 1 instruments and certain other insignificant derivatives and investments as either Level 2 or 3 instruments. Refer to Note 4 for disclosure of our debt instrument fair values. | |||||||||||||||||
Guarantees | |||||||||||||||||
We routinely grant limited warranties on our products with respect to defects in material and workmanship. The terms of these warranties are generally one year, however, certain components and products have substantially longer warranty periods. We recognize a reserve with respect to these obligations at the time of product sale, with subsequent warranty claims recorded directly against the reserve. The amount of the warranty reserve is determined based on historical trend experience for the covered products. For more significant warranty-related matters which might require a broad-based correction, separate reserves are established when such events are identified and the cost of correction can be reasonably estimated. The warranty reserve for fiscal 2014 includes net field corrective action reversals of $1.7 million as further testing of previously reported issues and actual claims activity supported changes to our prior estimates. During fiscal 2013, we recognized charges of $12.2 million to cover the estimated costs associated with field corrective actions on five different product lines. We also recognized a charge of $16.0 million for a fiscal 2012 field corrective action on one of our med-surg product lines. These field corrective actions do not limit the manufacture, sale or ongoing use of these products. | |||||||||||||||||
A reconciliation of changes in our warranty reserve is as follows: | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Balance at October 1 | $ | 38.1 | $ | 42.2 | $ | 17.8 | |||||||||||
Provision for warranties during the period | 9.8 | 29.2 | 31.8 | ||||||||||||||
Warranty reserves acquired | 3 | (2.6 | ) | 9.7 | |||||||||||||
Warranty claims incurred during the period | (22.5 | ) | (30.7 | ) | (17.1 | ) | |||||||||||
Balance at September 30 | $ | 28.4 | $ | 38.1 | $ | 42.2 | |||||||||||
In the normal course of business we enter into various other guarantees and indemnities in our relationships with suppliers, service providers, customers, business partners and others. Examples of these arrangements would include guarantees of product performance, indemnifications to service providers and indemnifications of our actions to business partners. These guarantees and indemnifications have not historically nor do we expect them to have a material impact on our financial condition or results of operations, although indemnifications associated with our actions generally have no dollar limitations. | |||||||||||||||||
In conjunction with our acquisition and divestiture activities, we have entered into select guarantees and indemnifications of performance with respect to the fulfillment of our commitments under applicable purchase and sale agreements. The arrangements generally indemnify the buyer or seller for damages associated with breach of contract, inaccuracies in representations and warranties surviving the closing date and satisfaction of liabilities and commitments retained under the applicable contract. With respect to sale transactions, we also routinely enter into non-competition agreements for varying periods of time. Guarantees and indemnifications with respect to acquisition and divestiture activities, if triggered, could have a materially adverse impact on our financial condition and results of operations. | |||||||||||||||||
Employee Benefits Change | |||||||||||||||||
During the second quarter of fiscal 2014, we implemented a new paid time off policy as part of our employee benefits programs, replacing certain previously existing vacation and sick time policies. In conjunction with these changes in policies, the vesting provisions with respect to the accumulation of paid time off were delayed resulting in the recognition and utilization of paid time off in the same benefits year. As a result of this change, significant portions of our existing accrued vacation balance were no longer necessary and we reversed $12.2 million in the second quarter of fiscal 2014 and an additional $1.2 million in the third quarter of fiscal 2014 to reflect the change in vesting provisions. All accounting with respect to this change in policy is now complete. | |||||||||||||||||
Retirement Plans | |||||||||||||||||
We sponsor retirement and postretirement plans covering select employees. Expense recognized in relation to these defined benefit retirement plans and the postretirement health care plan in the U.S. is based upon actuarial valuations and inherent in those valuations are key assumptions including discount rates, and where applicable, expected returns on assets, projected future salary rates and projected health care cost trends. The discount rates used in the valuation of our defined benefit pension and postretirement plans are evaluated annually based on current market conditions. In setting these rates we utilize long-term bond indices and yield curves as a preliminary indication of interest rate movements, and then make adjustments to the respective indices to reflect differences in the terms of the bonds covered under the indices in comparison to the projected outflow of our obligations. Our overall expected long-term rate of return on pension assets is based on historical and expected future returns, which are inflation adjusted and weighted for the expected return for each component of the investment portfolio. Our rate of assumed compensation increase is also based on our specific historical trends of wage adjustments. | |||||||||||||||||
We account for our defined benefit pension and other postretirement plans by recognizing the funded status of a benefit plan in the statement of financial position. We also recognize in accumulated other comprehensive income (loss) certain gains and losses that arose during the period. See Note 6 for key assumptions and further discussion related to our pension and postretirement plans. | |||||||||||||||||
Environmental Liabilities | |||||||||||||||||
Expenditures that relate to an existing condition caused by past operations, and which do not contribute to future revenue generation, are expensed. A reserve is established when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These reserves are determined without consideration of possible loss recoveries from third parties. | |||||||||||||||||
Specific costs included in environmental expense and reserves include site assessment, development of a remediation plan, clean-up costs, post-remediation expenditures, monitoring, fines, penalties and legal fees. Reserve amounts represent the expected undiscounted future cash outflows associated with such plans and actions. | |||||||||||||||||
Self Insurance | |||||||||||||||||
We are also involved in other possible claims, including product and general liability, workers' compensation, auto liability and employment related matters. Such claims in the United States have deductibles and self-insured retentions ranging from $25 thousand to $1.0 million per occurrence or per claim, depending upon the type of coverage and policy period. International deductibles and self-insured retentions are lower. We are also generally self-insured up to certain stop-loss limits for certain employee health benefits, including medical, drug and dental. Our policy is to estimate reserves based upon a number of factors including known claims, estimated incurred but not reported claims and outside actuarial analysis, which are based on historical information along with certain assumptions about future events. Such estimated reserves are classified as Other Current Liabilities and Other Long-Term Liabilities within the Consolidated Balance Sheets. | |||||||||||||||||
Revenue Recognition — Sales and Rentals | |||||||||||||||||
Net revenue reflects gross revenue less sales discounts and allowances and customer returns for product sales and rental revenue reserves. Revenue is evaluated under the following criteria and recognized when each is met: | |||||||||||||||||
• Evidence of an arrangement: An agreement with the customer reflecting the terms and conditions to deliver products or services serves as evidence of an arrangement. | |||||||||||||||||
• Delivery: For products, delivery is considered to occur upon receipt by the customer and the transfer of title and risk of loss. For rental services, delivery is considered to occur when the services are rendered. | |||||||||||||||||
• Fixed or determinable price: The sales price is considered fixed or determinable if it is not subject to refund or adjustment. | |||||||||||||||||
• Collection is deemed probable: At or prior to the time of a transaction, credit reviews of each customer are performed to determine the creditworthiness of the customer. Collection is deemed probable if the customer is expected to be able to pay amounts under the arrangement as those amounts become due. If collection is not probable, revenue is recognized when collection becomes probable, generally upon cash collection. | |||||||||||||||||
As a general interpretation of the above guidelines, revenue for health care and surgical products is generally recognized upon delivery of the products to the customer and their assumption of risk of loss and other risks and rewards of ownership. Local business customs and non-standard sales terms can sometimes result in deviations to this normal practice in certain instances; however, in no case is revenue recognized prior to the transfer of risk of loss and rewards of ownership. | |||||||||||||||||
For non-invasive therapy products and medical equipment management services, the majority of product offerings are rental products for which revenue is recognized consistent with the rendering of the service and use of products. For The Vest® product, revenue is generally recognized at the time of receipt of authorization for billing from the applicable paying entity as this serves as evidence of the arrangement and sets a fixed or determinable price. | |||||||||||||||||
For health care products and services aimed at improving operational efficiency and asset utilization, various revenue recognition techniques are used, depending on the offering. Arrangements to provide services, routinely under separately sold service and maintenance contracts, result in the deferral of revenue until specified services are performed. Service contract revenue is generally recognized ratably over the contract period, if applicable, or as services are rendered. Product-related goods are generally recognized upon delivery to the customer. | |||||||||||||||||
Revenue is presented in the Statements of Consolidated Income net of certain discounts and sales adjustments. For product sales, we record reserves resulting in a reduction of revenue for contractual discounts, as well as price concessions and product returns. Likewise, rental revenue reserves, reflecting contractual and other routine billing adjustments, are recorded as a reduction of revenue. Reserves for revenue are estimated based upon historical rates for revenue adjustments. | |||||||||||||||||
Taxes Collected from Customers and Remitted to Governmental Units | |||||||||||||||||
Taxes assessed by a governmental authority that are directly imposed on a revenue producing transaction between us and our customers, including but not limited to sales taxes, use taxes, and value added taxes, are accounted for on a net (excluded from revenue and cost) basis. | |||||||||||||||||
Cost of Revenue | |||||||||||||||||
Cost of goods sold for capital sales consists primarily of purchased material costs, fixed manufacturing expense, variable direct labor, overhead costs and costs associated with the distribution and delivery of products to our customers. Rental expenses consist of costs associated directly with rental revenue, including depreciation, maintenance, logistics and service center facility and personnel costs. | |||||||||||||||||
Research and Development Costs | |||||||||||||||||
Research and development costs are expensed as incurred. Costs were $71.9 million, $70.2 million and $66.9 million for fiscal years 2014, 2013 and 2012. | |||||||||||||||||
In addition, certain software development technology costs are capitalized as intangibles and are amortized over a period of three to five years once the software is ready for its intended use. The amount capitalized during fiscal years 2014, 2013 and 2012 was approximately $2.6 million, $2.4 million and $2.3 million. | |||||||||||||||||
Advertising Costs | |||||||||||||||||
Advertising costs are expensed as incurred. Costs were $7.3 million, $7.4 million and $4.4 million for fiscal years 2014, 2013 and 2012. | |||||||||||||||||
Comprehensive Income | |||||||||||||||||
We include the net-of-tax effect of unrealized gains or losses on our available-for-sale securities, foreign currency translation adjustments and pension or other defined benefit postretirement plans' actuarial gains or losses and prior service costs or credits in comprehensive income. Please see Note 5. | |||||||||||||||||
Foreign Currency Translation | |||||||||||||||||
The functional currency of foreign operations is generally the local currency in the country of domicile. Assets and liabilities of foreign operations are primarily translated into U.S. dollars at year-end rates of exchange and the income statements are translated at the average rates of exchange prevailing during the year. Adjustments resulting from translation of the financial statements of foreign operations into U.S. dollars are excluded from the determination of net income, but included as a component of accumulated other comprehensive income (loss). Foreign currency gains and losses resulting from foreign currency transactions are included in our results of operations and are not material. | |||||||||||||||||
Stock-Based Compensation | |||||||||||||||||
We account for stock-based compensation under fair value provisions. Stock-based compensation cost is measured at the grant date based on the value of the award and is recognized as expense over the vesting period. In order to determine the fair value of stock options and other performance-based stock awards on the date of grant, we utilize a Binomial model. Inherent in this model are assumptions related to a volatility factor, expected life, risk-free interest rate, dividend yield and expected forfeitures. The risk-free interest rate is based on factual data derived from public sources. The volatility factor, expected life, dividend yield and expected forfeiture assumptions require judgment utilizing historical information, peer data and future expectations. Deferred stock (also known as restricted stock units (“RSUs”)) is measured based on the fair market price of our common stock on the date of grant, as reported by the New York Stock Exchange, multiplied by the number of units granted. See Note 7 for further details. | |||||||||||||||||
Income Taxes | |||||||||||||||||
The Company and our eligible domestic subsidiaries file a consolidated U.S. income tax return. Foreign operations file income tax returns in a number of jurisdictions. Deferred income taxes are computed using an asset and liability approach to reflect the net tax effects of temporary differences between the financial reporting carrying amounts of assets and liabilities and the corresponding income tax amounts. We have a variety of deferred tax assets in numerous tax jurisdictions. These deferred tax assets are subject to periodic assessment as to recoverability. If it is determined that it is more likely than not that the benefits will not be realized, valuation allowances are recognized. In evaluating whether it is more likely than not that we would recover these deferred tax assets, future taxable income, the reversal of existing temporary differences and tax planning strategies are considered. | |||||||||||||||||
We account for uncertain income tax positions using a threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The difference between the tax benefit recognized in the financial statements for an uncertain income tax position and the tax benefit claimed in the tax return is referred to as an unrecognized tax benefit. See Note 9 for further details. | |||||||||||||||||
Derivative Instruments and Hedging Activity | |||||||||||||||||
We use derivative financial instruments to manage the economic impact of fluctuations in currency exchange and interest rates. Derivative financial instruments related to currency exchange rates include forward purchase and sale agreements which generally have terms no greater than 15 months. Additionally, interest rate swaps are used to convert some or all of our long-term debt to either a fixed or variable rate. | |||||||||||||||||
Derivative financial instruments are recognized on the Consolidated Balance Sheets as either assets or liabilities and are measured at fair value. Changes in the fair value of derivatives are recorded each period in the Statement of Consolidated Income or the Statement of Consolidated Comprehensive Income, depending on whether a derivative is designated and considered effective as part of a hedge transaction, and if it is, the type of hedge transaction. Gains and losses on derivative instruments reported in accumulated other comprehensive income (loss) are subsequently included in the Statement of Consolidated Income in the periods in which earnings are affected by the hedged item. These activities have not had a material effect on our financial position or results of operations for the periods presented herein. | |||||||||||||||||
Recently Issued Accounting Guidance | |||||||||||||||||
In February 2013, an accounting standards update was issued that amends the reporting of amounts reclassified out of accumulated other comprehensive income (loss). This standard does not change the current requirements for reporting net income or other comprehensive income (loss) in the financial statements. However, the guidance requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income (loss) by component, either on the face of the financial statement where net income is presented or in the notes to the financial statements. The standard is effective for fiscal 2014. See Note 5 for disclosure of our reclassifications out of accumulated other comprehensive loss. | |||||||||||||||||
In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers”, which provides guidance for revenue recognition. The standard's core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. This guidance will be effective for us in the first quarter of fiscal 2018, ending December 31, 2017. We are currently in the process of evaluating the impact of adoption of this ASU on our Consolidated Financial Statements. | |||||||||||||||||
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company's consolidated financial statements upon adoption. |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended | |||||
Sep. 30, 2014 | ||||||
Acquisitions [Abstract] | ' | |||||
ACQUISITIONS | ' | |||||
NOTE 2. ACQUISITIONS | ||||||
Trumpf Medical | ||||||
On August 1, 2014, we completed the acquisition of Trumpf Medical (“Trumpf”) and funded the transaction with a combination of cash on hand and borrowings under the revolving credit facility. Trumpf Medical provides a portfolio of well-established operating room (OR) infrastructure products such as surgical tables, surgical lighting, and supply units and expands our product offerings in the surgical suite. | ||||||
The purchase price was $229.9 million ($223.6 million net of cash acquired). The results of Trumpf are included in the Consolidated Financial Statements since the date of acquisition. Our reported revenue included $39.0 million for the year ended September 30, 2014 related to Trumpf products and the impact to net income was not significant. | ||||||
The following summarizes the fair value of assets acquired and liabilities assumed at the date of the acquisition. These results are preliminary and subject to normal true-up provisions in the purchase agreement and other fair value adjustments. | ||||||
Amount | ||||||
Trade receivables | $ | 66.3 | ||||
Inventory | 64.4 | |||||
Other current assets | 24.0 | |||||
Property, plant, and equipment | 42.1 | |||||
Goodwill | 57.3 | |||||
Trade name (5-year useful life) | 6.7 | |||||
Customer relationships (10-year weighted average useful life) | 15.8 | |||||
Developed technology (8-year weighted average useful life) | 17.8 | |||||
Other intangibles | 4.8 | |||||
Other noncurrent assets | 0.7 | |||||
Deferred tax asset | 14.2 | |||||
Current liabilities | (70.1 | ) | ||||
Long term debt | (6.0 | ) | ||||
Noncurrent liabilities | (8.1 | ) | ||||
Total purchase price | $ | 229.9 | ||||
Goodwill was allocated entirely to our Surgical and Respiratory Care segment. The goodwill related to the acquired German operations will be tax deductible while the remaining goodwill will not be deductible for tax purposes. | ||||||
Our total revenue on an unaudited proforma basis, as if the Trumpf acquisition had been consummated at the beginning of our 2013 fiscal year, would have been higher by approximately $218 million and $235 million for the years ended September 30, 2014 and 2013. The impact to net income on an unaudited proforma basis would not have been significant to our financial results for those years. The unaudited pro forma results are based on the Company's historical financial statements and those of the Trumpf business and do not necessarily indicate the results of operations that would have resulted had the acquisition been completed at the beginning of the comparable period presented and are not indicative of the results of operations in future periods. | ||||||
Virtus, Inc. | ||||||
On March 31, 2014 we completed a stock purchase agreement with the stockholders of Virtus, Inc. (“Virtus”) to acquire the entire equity interest in Virtus: a supplier of finished surfaces and components for our bed and stretcher products. The acquisition of Virtus insources a component of our supply chain. | ||||||
The purchase price was $17.6 million ($13.0 million net of cash acquired). We funded the transaction primarily with borrowings under the revolving credit facility. The results of Virtus are included in the Consolidated Financial Statements since the date of acquisition. | ||||||
The following summarizes the fair value of assets acquired and liabilities assumed at the date of the acquisition. During the third quarter of fiscal 2014, the remaining provisions of the stock purchase agreement were settled and the purchase price is now final. | ||||||
Amount | ||||||
Inventory | $ | 2.6 | ||||
Other current assets | 5.4 | |||||
Property, plant, and equipment | 1.9 | |||||
Goodwill | 9.4 | |||||
Current liabilities | (1.6 | ) | ||||
Deferred tax liability | (0.1 | ) | ||||
Total purchase price | $ | 17.6 | ||||
Goodwill is not deductible for tax purposes and was allocated to both our North America and International segments. | ||||||
The impact to our total revenue and net income on an unaudited proforma basis, as if the Virtus acquisition had been consummated at the beginning of our 2013 fiscal year, would not have been significant for the fiscal years ended September 30, 2014 and 2013. | ||||||
Aspen Surgical | ||||||
On July 23, 2012, we completed a stock purchase agreement with the stockholders and optionholders of Aspen Surgical Products Holding, Inc. (“Aspen Surgical”) to acquire the entire equity interest in Aspen Surgical. The acquisition of Aspen Surgical further develops our surgical business, adding a portfolio of consumable products and expanding our position in the North American and European surgical markets. | ||||||
The purchase price for Aspen Surgical was $402.2 million ($399.8 million net of cash acquired), which was reduced to $401.2 million, resulting from a $1.0 million purchase price adjustment in fiscal 2013. We funded the transaction with a combination of cash on hand and borrowings under the revolving credit facility. The results of Aspen Surgical are included in the Consolidated Financial Statements since the date of acquisition. | ||||||
Throughout fiscal 2013, we made certain adjustments to the opening balance sheet as of the acquisition date as we finalized the purchase price with the seller. The following summarizes the revised fair value of assets acquired and liabilities assumed at the date of the acquisition. | ||||||
Amount | ||||||
Inventory | $ | 25.6 | ||||
Other current assets | 19.7 | |||||
Property, plant, and equipment | 24.6 | |||||
Goodwill | 220.1 | |||||
Trade name (Indefinite Lived) | 29 | |||||
Trade name (15-year weighted-average useful life) | 4.6 | |||||
Customer relationships (13-year weighted-average useful life) | 121.9 | |||||
Technology (10-year weighted-average useful life) | 9.1 | |||||
Other noncurrent assets | 1.6 | |||||
Current liabilities | (14.0 | ) | ||||
Deferred tax liability | (41.0 | ) | ||||
Total purchase price | $ | 401.2 | ||||
Goodwill was allocated entirely to our Surgical and Respiratory Care segment and is not deductible for tax purposes. | ||||||
Völker | ||||||
On February 13, 2012, we acquired the Germany-based Völker group (“Völker”). Völker is a leading manufacturer of long-term care and acute care bed frames, surfaces and furniture in Europe and around the world. This transaction is expected to strengthen the Company's channels and product offerings in Europe, and furthers our objective of completing strategically relevant and value-enhancing acquisitions. The original purchase price for Völker was $80.7 million ($77.0 million net of cash acquired), which was reduced by $4.0 million related to a purchase price adjustment in the fourth quarter of fiscal 2012. The results of Völker are included in the Consolidated Financial Statements since the date of acquisition. | ||||||
During the second and fourth quarters of 2013, we made additional adjustments to the opening balance sheet related to the finalization of certain liabilities existing at the date of acquisition. During the first quarter of fiscal 2014, we entered a settlement agreement relating to certain contractual provisions of the Völker purchase agreement. This settlement reduced the purchase price by an additional $3.5 million, bringing the final purchase price to $73.2 million, which was recorded as a reduction of goodwill. The purchase price with respect to Völker is now final. The following summarizes the revised fair value of assets acquired and liabilities assumed at the date of the acquisition. | ||||||
Amount | ||||||
Goodwill | $ | 28.3 | ||||
Trade name (7-year useful life) | 12.3 | |||||
Customer relationships (8-year weighted average useful life) | 17.5 | |||||
Net assets acquired | 24.6 | |||||
Deferred tax liability | (9.5 | ) | ||||
Total purchase price | $ | 73.2 | ||||
Goodwill is not deductible for tax purposes and was allocated entirely to our International segment. |
GOODWILL_AND_INDEFINITELIVED_I
GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS [Abstract] | ' | ||||||||||||||||
GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS | ' | ||||||||||||||||
NOTE 3. GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS | |||||||||||||||||
The following summarizes goodwill activity by reportable segment: | |||||||||||||||||
North America | Surgical and | International | Total | ||||||||||||||
Respiratory Care | |||||||||||||||||
Balances at September 30, 2012: | |||||||||||||||||
Goodwill | $ | 383 | $ | 271.5 | $ | 153.5 | $ | 808 | |||||||||
Accumulated impairment losses | (358.1 | ) | - | (114.7 | ) | (472.8 | ) | ||||||||||
Goodwill, net at September 30, 2012 | 24.9 | 271.5 | 38.8 | 335.2 | |||||||||||||
Changes in Goodwill during the period: | |||||||||||||||||
Goodwill related to acquisitions | - | 4.8 | (1.9 | ) | 2.9 | ||||||||||||
Currency translation effect | - | 2.7 | 2 | 4.7 | |||||||||||||
Balances at September 30, 2013: | |||||||||||||||||
Goodwill | 383 | 279 | 153.6 | 815.6 | |||||||||||||
Accumulated impairment losses | (358.1 | ) | - | (114.7 | ) | (472.8 | ) | ||||||||||
Goodwill, net at September 30, 2013 | 24.9 | 279 | 38.9 | 342.8 | |||||||||||||
Changes in Goodwill during the period: | |||||||||||||||||
Goodwill related to acquisitions | 7.6 | 57.3 | (2.8 | ) | 62.1 | ||||||||||||
Currency translation effect | - | (2.8 | ) | (2.3 | ) | (5.1 | ) | ||||||||||
Balances at September 30, 2014: | |||||||||||||||||
Goodwill | 390.6 | 333.5 | 148.5 | 872.6 | |||||||||||||
Accumulated impairment losses | (358.1 | ) | - | (114.7 | ) | (472.8 | ) | ||||||||||
Goodwill, net at September 30, 2014 | $ | 32.5 | $ | 333.5 | $ | 33.8 | $ | 399.8 | |||||||||
We acquired Trumpf on August 1, 2014 and assigned all related goodwill to the Surgical and Respiratory Care segment based on the expected benefits resulting from the acquisition. As described in Note 2, we acquired Virtus on March 31, 2014 and recorded goodwill of $9.6 million, which was subsequently adjusted to $9.4 million as of June 30, 2014. The goodwill was allocated between our North America and International segments based on the expected benefits resulting from the acquisition. | |||||||||||||||||
As discussed in Note 2, we entered a settlement agreement relating to certain contractual provisions of the Völker purchase agreement, which reduced the purchase price by $3.5 million. | |||||||||||||||||
As discussed in Note 11, we operate in three reportable business segments. Goodwill impairment testing is performed at the reporting unit level, which is one level below a reportable business segment. We have determined that we have ten reporting units. Goodwill is assigned to reporting units at the date the goodwill is initially recorded and has been reallocated as necessary based on the restructuring of reporting units over time. Once goodwill has been assigned to reporting units, it no longer retains its association with a particular acquisition, and all of the activities within a reporting unit, whether acquired or organically grown, are available to support the value of the goodwill. | |||||||||||||||||
Testing for impairment must be performed annually, or on an interim basis upon the occurrence of a triggering event or change in circumstances that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The annual evaluation of goodwill performed during the third quarter of fiscal 2014 and 2013 did not result in any impairments. | |||||||||||||||||
A 10 percent reduction in the fair value of any of our reporting units would not result in an impairment charge. | |||||||||||||||||
Indefinite-lived intangible assets | |||||||||||||||||
We have various indefinite-lived intangible assets representing trade names with a carrying value of $32.9 million at both September 30, 2014 and September 30, 2013. Testing for impairment must be performed annually, or on an interim basis upon the occurrence of a triggering event or change in circumstances that would more likely than not reduce the fair value of an indefinite-lived intangible asset below its carrying amount. The annual evaluation of indefinite-lived intangible assets performed during the third quarter of fiscal 2014 and 2013 did not result in impairment. |
FINANCING_AGREEMENTS
FINANCING AGREEMENTS | 12 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
FINANCING AGREEMENTS [Abstract] | ' | ||||||||
FINANCING AGREEMENTS | ' | ||||||||
NOTE 4. FINANCING AGREEMENTS | |||||||||
Total debt consists of the following: | |||||||||
30-Sep | |||||||||
2014 | 2013 | ||||||||
Revolving credit facility | 265 | 70 | |||||||
Term loan current portion | 16.2 | 11.2 | |||||||
Term loan long-term portion | 160 | 176.2 | |||||||
Unsecured 7.00% debentures due on February 15, 2024 | 19.4 | 19.6 | |||||||
Unsecured 6.75% debentures due on December 15, 2027 | 29.8 | 29.8 | |||||||
Other | 1.4 | 0.2 | |||||||
Total debt | 491.8 | 307 | |||||||
Less current portion of debt | 126.9 | 81.2 | |||||||
Total long-term debt | $ | 364.9 | $ | 225.8 | |||||
The following table summarizes the scheduled maturities of long-term debt for fiscal years 2015 through 2019: | |||||||||
Term Loan | |||||||||
2015 | $ | 16.2 | |||||||
2016 | $ | 20 | |||||||
2017 | $ | 140 | |||||||
2018 | $ | - | |||||||
2019 | $ | - | |||||||
We have trade finance credit lines and uncommitted letter of credit facilities. These lines are associated with the normal course of business and we have $42.4 million of outstanding standby letters of credit as of September 30, 2014. $39.8 million relates to one standby letter of credit issued in connection with the Trumpf acquisition to guarantee Trumpf's outstanding debt, which we paid off during the fourth quarter of fiscal 2014. The expiration date for this letter of credit is January 2015. | |||||||||
Unsecured debentures outstanding at September 30, 2014 have fixed rates of interest. We have deferred gains included in the amounts above from the termination of previous interest rate swap agreements, and those deferred gains amounted to less than $1 million at both September 30, 2014 and September 30, 2013. The deferred gains on the termination of the swaps are being amortized and recognized as a reduction of interest expense over the remaining term of the related debt, and as a result, the effective interest rates on that debt have been and will continue to be lower than the stated interest rates on the debt. | |||||||||
We have a credit facility that provides for revolving loans of up to $500.0 million, plus term loans in the aggregate amount of $200.0 million. The Company may request to increase the revolving loan commitment and the amount of the term loans by up to an additional $250.0 million. All amounts due under the credit facility mature upon expiration on August 24, 2017. The related term loans amortize so that 37.5 percent of the principal will be repaid over the five year term, with the balance due at maturity. Borrowings under the credit facility and term loan bear interest at variable rates specified therein, that are currently less than 2.0 percent, and the availability of borrowings is subject to our ability at the time of borrowing to meet certain specified conditions, including compliance with covenants contained in the credit agreement governing the facility. The credit facility contains covenants that, among other matters, require us to maintain a ratio of consolidated indebtedness to consolidated EBITDA (each as defined in the credit agreement) of not more than 3.5:1.0 and a ratio of consolidated EBITDA to interest expense of not less than 3.5:1.0. As of September 30, 2014, we had outstanding borrowings of $265.0 million and undrawn letters of credit of $5.3 million under the facility, leaving $229.7 million of available borrowing capacity. The outstanding balance on the term loan was $176.2 million at September 30, 2014, of which $16.2 million is recognized as the current portion of the balance due. | |||||||||
We are exposed to market risk from fluctuations in interest rates. The Company sometimes manages its exposure to interest rate fluctuations through the use of interest rate swaps (cash flow hedges). As of September 30, 2014, we had one interest rate swap agreement with a notional amount of $126.3 million to hedge the variability of cash flows associated with a portion of the term loan variable interest rate payments for the period from January 2014 to August 2017. The interest rate swap has been designated as a cash flow hedge. The interest rate swap fair value was an asset of less than $0.2 million as of September 30, 2014 and 2013. The fair value measurement for our interest rate swap is classified as Level 2, as described in Note 1. | |||||||||
The fair value of our debt is estimated based on the quoted market prices for the same or similar issues or on the current rates offered to us for debt of the same remaining maturities. The book values of our short-term debt instruments approximate fair value. The estimated fair values of our long-term unsecured debentures were $55.5 million and $52.5 million at September 30, 2014 and 2013, and were based on observable inputs such as quoted prices in markets that are not active. The estimated fair value of our term loan was $175.2 million and $185.5 million based on quoted prices for similar liabilities at September 30, 2014 and 2013. The fair value measurements for both our long-term unsecured debentures and our term loan were classified as Level 2, as described in Note 1. |
OTHER_COMPREHENSIVE_INCOME
OTHER COMPREHENSIVE INCOME | 12 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Other Comprehensive Income [Abstract] | ' | ||||||||||||
Other Comprehensive Income | ' | ||||||||||||
NOTE 5. OTHER COMPREHENSIVE INCOME | |||||||||||||
The following table represents the changes in accumulated other comprehensive loss by component for the year to date period ended September 30, 2014: | |||||||||||||
Available-For-Sale | Foreign Currency | Changes in Pension | |||||||||||
Securities and Cash | Translation | and Postretirement | |||||||||||
Flow Hedges (1) | Adjustment (1) | Defined Benefit | |||||||||||
Plans (1) | |||||||||||||
Balance as of September 30, 2013 | $ | (0.3 | ) | $ | (4.6 | ) | $ | (30.8 | ) | ||||
OCI before reclassifications (2) | 0.2 | (29.6 | ) | (10.8 | ) | ||||||||
Amounts reclassified out of AOCL | 0.1 | - | 1.7 | ||||||||||
Net current period OCI | 0.3 | (29.6 | ) | (9.1 | ) | ||||||||
Balance as of September 30, 2014 | $ | - | $ | (34.2 | ) | $ | (39.9 | ) | |||||
(1) | All amounts are net of tax. | ||||||||||||
-2 | Net of tax of $(0.1), $0.0, and $6.0 for available-for-sale securities and cash flow hedges, foreign currency translation adjustment, and changes in pension and postretirement defined benefit plans, respectively. | ||||||||||||
The following table represents the items reclassified out of accumulated other comprehensive loss and the related tax effects during fiscal 2014: | |||||||||||||
Year End | |||||||||||||
30-Sep-14 | |||||||||||||
Pension and postretirement defined benefit plan items | |||||||||||||
Amortization of amounts included in net periodic pension expense and postretirement healthcare costs (1) | $ | 2.7 | |||||||||||
Tax expense | (1.0 | ) | |||||||||||
Net of tax | $ | 1.7 | |||||||||||
Available-for-sale securities and cash flow hedges items: | |||||||||||||
Recognition of other-than-temporary impairment on investment securities (2) | $ | 0.1 | |||||||||||
Tax expense | - | ||||||||||||
Net of tax | $ | 0.1 | |||||||||||
(1) | Reclassified from AOCL into cost of goods sold and selling and administrative expenses. These components are included in the computation of net periodic pension expense and postretirement healthcare costs. | ||||||||||||
-2 | Reclassified from AOCL into other income (expense), net. | ||||||||||||
RETIREMENT_AND_POSTRETIREMENT_
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS [Abstract] | ' | ||||||||||||||||||||||||
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS | ' | ||||||||||||||||||||||||
NOTE 6. RETIREMENT AND POSTRETIREMENT BENEFIT PLANS | |||||||||||||||||||||||||
Our retirement plans consist of defined benefit plans, a postretirement healthcare plan, and defined contribution savings plans. Plans cover certain employees both in and outside of the U.S. | |||||||||||||||||||||||||
Retirement Plans | |||||||||||||||||||||||||
We sponsor five defined benefit plans. Those plans include a master defined benefit retirement plan, a nonqualified supplemental executive defined benefit retirement plan, and three defined benefit retirement plans covering employees in Germany and France. Benefits for such plans are based primarily on years of service and the employee's level of compensation during specific periods of employment. We contribute funds to trusts as necessary to provide for current service and for any unfunded projected future benefit obligation over a reasonable period of time. All of our plans have a September 30 measurement date. | |||||||||||||||||||||||||
Effect on Operations | |||||||||||||||||||||||||
The components of net periodic benefit cost for our defined benefit retirement plans were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Service cost | $ | 5 | $ | 6.1 | $ | 5.5 | |||||||||||||||||||
Interest cost | 14.4 | 13.2 | 13.3 | ||||||||||||||||||||||
Expected return on plan assets | (16.7 | ) | (15.9 | ) | (16.7 | ) | |||||||||||||||||||
Amortization of unrecognized prior service cost, net | 0.6 | 0.6 | 0.6 | ||||||||||||||||||||||
Amortization of net loss | 3.2 | 7.8 | 6.1 | ||||||||||||||||||||||
Net periodic benefit cost | 6.5 | 11.8 | 8.8 | ||||||||||||||||||||||
Special termination benefits | 2.4 | - | - | ||||||||||||||||||||||
Net pension expense | $ | 8.9 | $ | 11.8 | $ | 8.8 | |||||||||||||||||||
During the second quarter of fiscal 2014, we initiated a domestic early retirement program, which offered certain special termination benefits relating to our pension and postretirement health care plans. This program and the related special termination benefits resulted in a non-cash charge of $3.2 million, of which $2.4 million related to our master defined benefit retirement plan and $0.8 million for our postretirement health care plan. The $0.8 million postretirement healthcare charge also reflects a $1.3 million reversal recorded as certain participants elected alternative coverage separate from the postretirement health care plan. The employee elections were not known until the third and fourth quarters of fiscal 2014. The reversal was recorded to the special charges caption and is offset by charges recorded to reflect our incremental cost associated with the alternative coverage. Refer to Note 8 for more details. | |||||||||||||||||||||||||
Obligations and Funded Status | |||||||||||||||||||||||||
The change in benefit obligations, plan assets and funded status, along with amounts recognized in the Consolidated Balance Sheets for our defined benefit retirement plans were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Change in benefit obligation: | |||||||||||||||||||||||||
Benefit obligation at beginning of year | $ | 297.9 | $ | 327.4 | |||||||||||||||||||||
Service cost | 5 | 6.1 | |||||||||||||||||||||||
Interest cost | 14.4 | 13.2 | |||||||||||||||||||||||
Actuarial loss (gain) | 31.4 | (41.1 | ) | ||||||||||||||||||||||
Benefits paid | (10.2 | ) | (9.1 | ) | |||||||||||||||||||||
Acquisitions | 4.3 | - | |||||||||||||||||||||||
Amendments | - | 0.6 | |||||||||||||||||||||||
Special termination benefits | 2.4 | - | |||||||||||||||||||||||
Exchange rate (gain) loss | (1.4 | ) | 0.8 | ||||||||||||||||||||||
Benefit obligation at end of year | 343.8 | 297.9 | |||||||||||||||||||||||
Change in plan assets: | |||||||||||||||||||||||||
Fair value of plan assets at beginning of year | 254.4 | 246.8 | |||||||||||||||||||||||
Actual return on plan assets | 30.9 | 15.7 | |||||||||||||||||||||||
Employer contributions | 1 | 1 | |||||||||||||||||||||||
Benefits paid | (10.2 | ) | (9.1 | ) | |||||||||||||||||||||
Fair value of plan assets at end of year | 276.1 | 254.4 | |||||||||||||||||||||||
Funded status and net amounts recognized | $ | (67.7 | ) | $ | (43.5 | ) | |||||||||||||||||||
Amounts recorded in the Consolidated Balance Sheets: | |||||||||||||||||||||||||
Accrued pension benefits, current portion | $ | (1.0 | ) | $ | (0.2 | ) | |||||||||||||||||||
Accrued pension benefits, long-term | (66.7 | ) | (43.3 | ) | |||||||||||||||||||||
Net amount recognized | $ | (67.7 | ) | $ | (43.5 | ) | |||||||||||||||||||
In addition to the amounts above, net actuarial losses of $65.0 million and prior service costs of $1.7 million, less an applicable aggregate tax effect of $24.8 million are included as components of accumulated other comprehensive loss at September 30, 2014. At September 30, 2013, net actuarial losses of $51.3 million and prior service costs of $2.4 million, less an applicable aggregate tax effect of $20.0 million, were included as components of accumulated other comprehensive loss. | |||||||||||||||||||||||||
The estimated net actuarial loss and prior service cost for our defined benefit retirement plans that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year are $5.4 million and $0.6 million. | |||||||||||||||||||||||||
Accumulated Benefit Obligation | |||||||||||||||||||||||||
The accumulated benefit obligation for all defined benefit pension plans was $325.9 million and $278.8 million at September 30, 2014 and 2013. Selected information for our plans, including plans with accumulated benefit obligations exceeding plan assets, was as follows: | |||||||||||||||||||||||||
30-Sep | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
PBO | ABO | Plan Assets | PBO | ABO | Plan Assets | ||||||||||||||||||||
Master plan | $ | 319.1 | $ | 303.2 | $ | 275.8 | $ | 279.2 | $ | 261.7 | $ | 254 | |||||||||||||
International plans | 20.3 | 18.5 | 0.3 | 14.8 | 13.4 | 0.4 | |||||||||||||||||||
Supplemental executive plan | 4.4 | 4.2 | - | 3.9 | 3.7 | - | |||||||||||||||||||
$ | 343.8 | $ | 325.9 | $ | 276.1 | $ | 297.9 | $ | 278.8 | $ | 254.4 | ||||||||||||||
Actuarial Assumptions | |||||||||||||||||||||||||
The weighted average assumptions used in accounting for our domestic pension plans were as follows: | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Weighted average assumptions to determine benefit | |||||||||||||||||||||||||
obligations at the measurement date: | |||||||||||||||||||||||||
Discount rate for obligation | 4.5 | % | 5 | % | 4.1 | % | |||||||||||||||||||
Rate of compensation increase | 3 | % | 3.3 | % | 3.3 | % | |||||||||||||||||||
Weighted average assumptions to determine benefit | |||||||||||||||||||||||||
cost for the year: | |||||||||||||||||||||||||
Discount rate for expense | 5 | % | 4.1 | % | 4.6 | % | |||||||||||||||||||
Expected rate of return on plan assets | 7 | % | 7 | % | 7.5 | % | |||||||||||||||||||
Rate of compensation increase | 3.3 | % | 3.3 | % | 3.5 | % | |||||||||||||||||||
The discount rates used in the valuation of our defined benefit pension plans are evaluated annually based on current market conditions. In setting these rates we utilize long-term bond indices and yield curves as a preliminary indication of interest rate movements, and then make adjustments to the respective indices to reflect differences in the terms of the bonds covered under the indices in comparison to the projected outflow of our pension obligation. The overall expected long-term rate of return is based on historical and expected future returns, which are inflation adjusted and weighted for the expected return for each component of the investment portfolio, as well as taking into consideration economic and capital market conditions. The rate of assumed compensation increase is also based on our specific historical trends of past wage adjustments. The weighted average assumptions used for our international plans are lower than our domestic plan assumptions and do not significantly affect the consolidated net benefit obligation or net periodic benefit cost balances. | |||||||||||||||||||||||||
Plan Assets | |||||||||||||||||||||||||
The weighted average asset allocations of our master defined benefit retirement plan at September 30, 2014 and 2013, by asset category, along with target allocations, are as follows: | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Target | Target | Actual | Actual | ||||||||||||||||||||||
Allocation | Allocation | Allocation | Allocation | ||||||||||||||||||||||
Equity securities | 40 - 60% | 40 - 60% | 52 | % | 57 | % | |||||||||||||||||||
Fixed income securities | 40 - 60% | 40 - 60% | 48 | % | 43 | % | |||||||||||||||||||
Total | 100 | % | 100 | % | |||||||||||||||||||||
We have a Plan Committee that sets investment guidelines with the assistance of an external consultant. These guidelines are established based on market conditions, risk tolerance, funding requirements and expected benefit payments. The Plan Committee also oversees the investment allocation process, selects the investment managers and monitors asset performance. As pension liabilities are long-term in nature, we employ a long-term total return approach to maximize the long-term rate of return on plan assets for a prudent level of risk. Target allocations are guidelines, not limitations, and plan fiduciaries may occasionally approve allocations above or below a target range or elect to rebalance the portfolio within the targeted range. | |||||||||||||||||||||||||
The investment portfolio contains a diversified portfolio of primarily equities and fixed income securities. Securities are also diversified in terms of domestic and international securities, short- and long-term securities, growth and value styles, large cap and small cap stocks. The Plan Committee believes with prudent risk tolerance and asset diversification, the account should be able to meet its pension obligation in the future. | |||||||||||||||||||||||||
Trust assets are invested subject to the following policy restrictions: short-term securities must be rated A2/P2 or higher; all fixed-income securities shall have a credit quality rating “BBB” or higher; investments in equities in any one company may not exceed 10 percent of the equity portfolio. | |||||||||||||||||||||||||
Fair Value Measurements of Plan Assets | |||||||||||||||||||||||||
The following table summarizes the valuation of our pension plan assets by pricing categories: | |||||||||||||||||||||||||
Quoted Prices in | Significant | ||||||||||||||||||||||||
Active Markets | Other | Significant | |||||||||||||||||||||||
for Identical | Observable | Unobservable | |||||||||||||||||||||||
Balance at | Assets | Inputs | Inputs | ||||||||||||||||||||||
September 30, 2014 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||||||||
Cash | $ | 2.1 | $ | 2.1 | $ | - | $ | - | |||||||||||||||||
Equities | |||||||||||||||||||||||||
US companies | 101.7 | 101.7 | - | - | |||||||||||||||||||||
International companies | 38.7 | 38.7 | - | - | |||||||||||||||||||||
Fixed income securities | 133.2 | 66.8 | 66.4 | - | |||||||||||||||||||||
Other | 0.4 | 0.4 | - | - | |||||||||||||||||||||
Total plan assets at fair value | $ | 276.1 | $ | 209.7 | $ | 66.4 | $ | - | |||||||||||||||||
Quoted Prices in | Significant | ||||||||||||||||||||||||
Active Markets | Other | Significant | |||||||||||||||||||||||
for Identical | Observable | Unobservable | |||||||||||||||||||||||
Balance at | Assets | Inputs | Inputs | ||||||||||||||||||||||
September 30, 2013 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||||||||
Cash | $ | 3 | $ | 3 | $ | - | $ | - | |||||||||||||||||
Equities | |||||||||||||||||||||||||
U.S. companies | 101 | 101 | - | - | |||||||||||||||||||||
International companies | 41.2 | 41.2 | - | - | |||||||||||||||||||||
Fixed income securities | 108.8 | 59.1 | 49.7 | - | |||||||||||||||||||||
Other | 0.4 | 0.4 | - | - | |||||||||||||||||||||
Total plan assets at fair value | $ | 254.4 | $ | 204.7 | $ | 49.7 | $ | - | |||||||||||||||||
The Level 2 fixed income securities are commingled funds valued using the net asset value (“NAV”) unit price provided by the fund administrator. The NAV is based on the value of the underlying assets owned by the fund, all of which are publicly traded securities. For further descriptions of the asset Levels used in the above chart, refer to Note 1. | |||||||||||||||||||||||||
Cash Flows | |||||||||||||||||||||||||
Our U.S. qualified defined benefit plan is funded in excess of 80 percent, and therefore we expect that the plan will not be subject to the “at risk” funding requirements of the Pension Protection Act. | |||||||||||||||||||||||||
During 2014 and 2013, we contributed cash of $1.0 million and $1.0 million to our defined benefit retirement plans. We do not expect to contribute to our master defined benefit retirement plan in fiscal year 2015 due to the current funding level; however, minimal contributions will be required for our unfunded plans. | |||||||||||||||||||||||||
Estimated Future Benefit Payments | |||||||||||||||||||||||||
The benefit payments, which are expected to be funded through plan assets and company contributions and reflect expected future service, are expected to be paid as follows: | |||||||||||||||||||||||||
Pension Benefits | |||||||||||||||||||||||||
2015 | $ | 12.6 | |||||||||||||||||||||||
2016 | $ | 13.3 | |||||||||||||||||||||||
2017 | $ | 13.8 | |||||||||||||||||||||||
2018 | $ | 14.5 | |||||||||||||||||||||||
2019 | $ | 15.4 | |||||||||||||||||||||||
2020-2024 | $ | 92.2 | |||||||||||||||||||||||
Defined Contribution Savings Plans | |||||||||||||||||||||||||
We have defined contribution savings plans that cover substantially all U.S. employees and certain non-U.S. employees. The general purpose of these plans is to provide additional financial security during retirement by providing employees with an incentive to make regular savings. Company contributions to the plans are based on eligibility and employee contributions. Expense under these plans was $15.0 million, $15.8 million and $13.3 million in fiscal years 2014, 2013 and 2012. | |||||||||||||||||||||||||
Postretirement Health Care Plan | |||||||||||||||||||||||||
In addition to defined benefit retirement plans, we also offer a domestic postretirement health care plan that provides health care benefits to qualified retirees and their dependents. The plan includes retiree cost sharing provisions and generally extends retiree coverage for medical, prescription and dental benefits beyond the COBRA continuation period to the date of Medicare eligibility. We use a measurement date of September 30 for this plan. | |||||||||||||||||||||||||
The postretirement health care plan reflected a credit during fiscal 2014, 2013 and 2012 of ($0.2) million, ($0.1) million and ($0.3) million. The change in the accumulated postretirement benefit obligation was as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Change in benefit obligation: | |||||||||||||||||||||||||
Benefit obligation at beginning of year | $ | 9.8 | $ | 9.6 | |||||||||||||||||||||
Service cost | 0.4 | 0.4 | |||||||||||||||||||||||
Interest cost | 0.4 | 0.3 | |||||||||||||||||||||||
Actuarial (gain) loss | (0.2 | ) | (0.2 | ) | |||||||||||||||||||||
Benefits paid | (0.2 | ) | (0.5 | ) | |||||||||||||||||||||
Retiree contributions | 0.2 | 0.2 | |||||||||||||||||||||||
Special termination benefits | 0.8 | - | |||||||||||||||||||||||
Benefit obligation at end of year | $ | 11.2 | $ | 9.8 | |||||||||||||||||||||
Amounts recorded in the Consolidated Balance Sheets: | |||||||||||||||||||||||||
Accrued benefits obligation, current portion | $ | 1.1 | $ | 0.5 | |||||||||||||||||||||
Accrued benefits obligation, long-term | 10.1 | 9.3 | |||||||||||||||||||||||
Net amount recognized | $ | 11.2 | $ | 9.8 | |||||||||||||||||||||
We contributed less than $0.1 million to the plan in fiscal 2014, compared with $0.3 million contributed in fiscal 2013. | |||||||||||||||||||||||||
In addition to the amounts above, net actuarial gains of $1.7 million and prior service credits of $2.3 million, less an applicable aggregate tax effect of ($1.6) million are included as components of accumulated other comprehensive loss at September 30, 2014. At September 30, 2013, net actuarial gains of $1.8 million and prior service credits of $3.0 million, less an applicable aggregate tax effect of ($1.9) million are included as components of accumulated other comprehensive loss. | |||||||||||||||||||||||||
The estimated net actuarial gain and prior service benefit for our postretirement health care plan that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year are ($0.1) million and ($0.9) million. | |||||||||||||||||||||||||
The discount rate used to determine the net periodic benefit cost for the postretirement health care plan during the fiscal year ended September 30, 2014, 2013 and 2012 was 4.1, 3.3 and 4.0 percent. The discount rate used to determine the benefit obligation as of September 30, 2014, 2013 and 2012 was 3.7, 4.1 and 3.3 percent. As of September 30, the health care-cost trend rates were assumed to decrease as follows: | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Year 1 | 5.75 | % | 6.25 | % | 6.75 | % | |||||||||||||||||||
Year 2 | 5.25 | % | 5.75 | % | 6.25 | % | |||||||||||||||||||
Year 3 | 5 | % | 5.25 | % | 5.75 | % | |||||||||||||||||||
Year 4 | 5 | % | 5 | % | 5.25 | % | |||||||||||||||||||
Year 5 | 5 | % | 5 | % | 5 | % | |||||||||||||||||||
Year 6 | 5 | % | 5 | % | 5 | % | |||||||||||||||||||
Year 7 | 5 | % | 5 | % | 5 | % | |||||||||||||||||||
Year 8 and beyond | 5 | % | 5 | % | 5 | % | |||||||||||||||||||
A one-percentage-point increase/decrease in the assumed health care cost trend rates as of September 30, 2014 would cause an increase/decrease in service and interest costs of less than $0.1 million, along with an increase/decrease in the benefit obligation of $0.8 million and $0.8 million. | |||||||||||||||||||||||||
We fund the postretirement health care plan as benefits are paid, and current plan benefits are expected to require net company contributions of approximately $1.0 million in fiscal 2015 and less than $1.0 million per year thereafter. |
COMMON_STOCK
COMMON STOCK | 12 Months Ended | |||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||
COMMON STOCK [Abstract] | ' | |||||||||||||||||
COMMON STOCK | ' | |||||||||||||||||
NOTE 7. COMMON STOCK | ||||||||||||||||||
Share Repurchases | ||||||||||||||||||
We repurchased 1.7 million, 2.8 million and 1.5 million shares of our common stock during fiscal years 2014, 2013 and 2012 for $70.5 million, $92.7 million and $42.4 million, respectively, in the open market. The common stock was acquired under a $190 million share repurchase program approved by the Board of Directors in September 2013, which does not have an expiration date. There are no plans to terminate this program in the future. Repurchases may be made on the open market or via private transactions, and are used for general business purposes. | ||||||||||||||||||
Stock-Based Compensation | ||||||||||||||||||
We have stock-based compensation plans under which employees and non-employee directors may be granted options to purchase shares of Company common stock at the fair market value at the time of grant. In addition to stock options, we grant performance share units (“PSUs”) and RSUs to certain management level employees and vested deferred stock to non-employee directors. We also offer eligible employees the opportunity to buy shares of our common stock at a discount via an Employee Stock Purchase Plan (“ESPP”). | ||||||||||||||||||
Our primary stock-based compensation program is the Stock Incentive Plan, which has been approved by our shareholders. Under the Stock Incentive Plan, we have a total of 15.3 million authorized shares. At September 30, 2014, 5.0 million shares were available for future grants under our stock-based compensation plans. We generally settle our stock-based awards with treasury shares. As of September 30, 2014, we had 22.9 million treasury shares available for use to settle stock-based awards. | ||||||||||||||||||
The following table sets forth a summary of the annual stock-based compensation cost that was charged against income for all types of awards: | ||||||||||||||||||
Years Ended September 30 | ||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||
Total stock-based compensation cost (pre-tax) | $ | 18 | $ | 13.5 | $ | 11.6 | ||||||||||||
Total income tax benefit | (6.5 | ) | (4.9 | ) | (4.2 | ) | ||||||||||||
Total stock-based compensation cost, net of tax | $ | 11.5 | $ | 8.6 | $ | 7.4 | ||||||||||||
Stock Options | ||||||||||||||||||
Stock options granted by our Compensation Committee under the Stock Incentive Plan are non-qualified stock options. These awards are generally granted with exercise prices equal to the average of the high and low prices of our common stock on the date of grant. They vest in equal annual installments over a three or four year period and the maximum contractual term is ten years. We use a Binomial option-pricing model to estimate the fair value of stock options, and compensation cost is recognized on a straight-line basis over the requisite service period. | ||||||||||||||||||
The following table sets forth the weighted average fair value per share of stock options and the related valuation assumptions used in the determination of those fair values: | ||||||||||||||||||
Years Ended September 30 | ||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||
Weighted average fair value per share | $ | 11.91 | $ | 7.91 | $ | 9.79 | ||||||||||||
Valuation assumptions: | ||||||||||||||||||
Risk-free interest rate | 1.3 | % | 0.6 | % | 1 | % | ||||||||||||
Expected dividend yield | 1.4 | % | 1.9 | % | 1.4 | % | ||||||||||||
Expected volatility | 36.1 | % | 40.2 | % | 41.2 | % | ||||||||||||
Weighted average expected life | 4.9 years | 4.9 years | 4.8 years | |||||||||||||||
The risk-free interest rate is based upon observed U.S. Treasury interest rates appropriate for the term of our employee stock options. Expected dividend yield is based on the history and our expectation of dividend payouts. For fiscal 2014 and 2013, expected volatility was based on our historical stock price volatility. In fiscal 2012, expected volatility was based on the median of our Peer Group. The change in assumption did not have a material impact on our financial statements. Expected life represents the weighted average period the stock options are expected to remain outstanding and is a derived output of the Binomial model. The expected life of employee stock options is impacted by the above assumptions as well as the post-vesting forfeiture rate and the exercise factor used in the Binomial model. These two variables are based on the history of exercises and forfeitures for previous stock options granted by us. | ||||||||||||||||||
The following table summarizes transactions under our stock option plans for fiscal year 2014: | ||||||||||||||||||
Weighted | Weighted | |||||||||||||||||
Average | Weighted | Average | Aggregate | |||||||||||||||
Number of | Average | Remaining | Intrinsic | |||||||||||||||
Shares | Exercise | Contractual | Value (1) | |||||||||||||||
(in thousands) | Price | Term | (in millions) | |||||||||||||||
Balance Outstanding at October 1, 2013 | 2,163 | $ | 29.89 | |||||||||||||||
Granted | 367 | 41.47 | ||||||||||||||||
Exercised | (376 | ) | 27.85 | |||||||||||||||
Cancelled/Forfeited | (162 | ) | 35.18 | |||||||||||||||
Balance Outstanding at September 30, 2014 | 1,992 | $ | 31.99 | 6.9 years | $ | 18.9 | ||||||||||||
Exercisable at September 30, 2014 | 1,013 | $ | 30.12 | 5.7 years | $ | 11.5 | ||||||||||||
Options Expected to Vest | 897 | $ | 33.8 | 8.0 years | $ | 6.9 | ||||||||||||
-1 | The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $41.43, as reported by the New York Stock Exchange on September 30, 2014. This amount, which changes continuously based on the fair value of our common stock, would have been received by the option holders had all option holders exercised their options as of the balance sheet date. | |||||||||||||||||
The total intrinsic value of options exercised during fiscal years 2014, 2013 and 2012 was $4.6 million, $1.6 million and $1.3 million. | ||||||||||||||||||
As of September 30, 2014, there was $4.7 million of unrecognized compensation expense related to stock options granted under the Plan. This unrecognized compensation expense does not reflect a reduction for our estimate of potential forfeitures, and is expected to be recognized over a weighted average period of 1.9 years. | ||||||||||||||||||
Restricted Stock Units | ||||||||||||||||||
RSUs are granted to certain employees with fair values equal to the average of the high and low prices of our common stock on the date of grant, multiplied by the number of units granted. RSU grants are contingent upon continued employment and vest over periods ranging from one to four years. Dividends, payable in common stock equivalents, accrue on the grants and are subject to the same specified terms as the original grants, including the risk of forfeiture. | ||||||||||||||||||
The following table summarizes transactions for our nonvested RSUs for fiscal year 2014: | ||||||||||||||||||
Weighted | ||||||||||||||||||
Number of | Average | |||||||||||||||||
Share Units | Grant Date | |||||||||||||||||
(in thousands) | Fair Value | |||||||||||||||||
Nonvested RSUs at October 1, 2013 | 341 | $ | 29.34 | |||||||||||||||
Granted | 263 | 41.01 | ||||||||||||||||
Vested | (98 | ) | 30.39 | |||||||||||||||
Forfeited | (75 | ) | 36.24 | |||||||||||||||
Nonvested RSUs at September 30, 2014 | 431 | $ | 34.92 | |||||||||||||||
As of September 30, 2014, there was $7.5 million of total unrecognized compensation expense related to nonvested RSUs granted under the Stock Incentive Plan. This unrecognized compensation expense does not reflect a reduction for our estimate of potential forfeitures, and is expected to be recognized over a weighted average period of 2 years. The total vest date fair value of shares that vested during fiscal years 2014, 2013 and 2012 was $6.7 million, $5.8 million and $6.8 million. | ||||||||||||||||||
Performance Share Units | ||||||||||||||||||
Our Compensation Committee grants PSUs to certain employees and these awards are subject to any stock dividends, stock splits, and other similar rights inuring to common stock, but unlike our RSUs are not entitled to dividend reinvestment. Vesting of the grants is contingent upon achievement of performance targets and corresponding service requirements. | ||||||||||||||||||
The fair value of the PSUs is equal to the average of the high and low prices of our common stock on the date of grant, multiplied by the number of units granted. For PSUs with a market condition such as total shareholder return, the Monte-Carlo simulation method is used to determine fair value. The Monte-Carlo simulation is a generally accepted statistical technique used to generate a defined number of stock price paths in order to develop a reasonable estimate of the range of our and the Peer Group's future expected stock prices. | ||||||||||||||||||
The following table sets forth the weighted average fair value per share for PSUs and the related valuation assumptions used in the determination of those fair values. PSUs granted in fiscal 2014 are based on company-specific performance targets, with a total shareholder return collar, while grants in fiscal 2013 are based entirely on total shareholder return targets. | ||||||||||||||||||
Years Ended September 30 | ||||||||||||||||||
2014 | 2013 | |||||||||||||||||
Weighted average fair value per share | $ | 47.91 | $ | 19.77 | ||||||||||||||
Valuation assumptions: | ||||||||||||||||||
Risk-free interest rate | 0.5 | % | 0.3 | % | ||||||||||||||
Expected dividend yield | 0 | % | 0 | % | ||||||||||||||
Expected volatility | 30.1 | % | 32.6 | % | ||||||||||||||
The basis for the assumptions listed above is similar to the valuation assumptions used for stock options, as discussed previously. | ||||||||||||||||||
The following table summarizes transactions for our nonvested PSUs for fiscal 2014: | ||||||||||||||||||
Weighted | ||||||||||||||||||
Number of | Average | |||||||||||||||||
Share Units | Grant Date | |||||||||||||||||
(in thousands) | Fair Value | |||||||||||||||||
Nonvested PSUs as of October 1, 2013 | 574 | $ | 23.84 | |||||||||||||||
Granted | 205 | 47.91 | ||||||||||||||||
Vested | - | - | ||||||||||||||||
Cancelled | (122 | ) | 31.13 | |||||||||||||||
Forfeited | (71 | ) | 30.08 | |||||||||||||||
Nonvested PSUs at September 30, 2014 | 586 | $ | 29.98 | |||||||||||||||
As of September 30, 2014, there was $8.6 million of unrecognized compensation expense related to PSUs granted under the Stock Incentive Plan based on the expected achievement of certain performance targets or market conditions. This unrecognized compensation expense does not reflect a reduction for our estimate of potential forfeitures, and is expected to be recognized by the end of fiscal 2016. |
SPECIAL_CHARGES
SPECIAL CHARGES | 12 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Special Charges [Abstract] | ' | ||||||||||||||||||||
SPECIAL CHARGES | ' | ||||||||||||||||||||
NOTE 8. SPECIAL CHARGES | |||||||||||||||||||||
Over the past several years, we have placed a focus on improving our cost structure and business processes through various means including consolidation of certain manufacturing and select back office operations, customer rationalizations and various other organizational changes. As a result of these actions, we recognized special charges of $37.1 million, $5.7 million, and $18.2 million for the fiscal years ended September 30, 2014, 2013, and 2012, respectively. These charges are summarized below. | |||||||||||||||||||||
2014 Actions | |||||||||||||||||||||
During the second quarter of fiscal 2014, we announced a global restructuring program to improve our cost structure. As part of this program, we offered an early retirement program to certain U.S. employees. Through this program, other reduction in force actions, and the elimination of certain contractor and open positions, we eliminated over 200 net positions primarily in the U.S. This portion of the program resulted in a special charge of $11.0 million related to severance and other benefits to be provided to affected employees. We also recorded a $3.2 million charge related to special pension and postretirement healthcare plan benefits granted to employees eligible for the early retirement program. As discussed in Note 6, the severance and other benefits and postretirement benefit charge balances reflect a $1.3 million reclassification compared to the original charge recorded in the second quarter of 2014. Subsequently during the fiscal year, we reversed $0.7 million of the severance and other benefits accrual due to certain plan participants declining continuing healthcare coverage, as well as other changes in circumstances affecting the estimated future payments to be made. This portion of the restructuring program is substantially complete, but cash expenditures will continue into fiscal year 2015. The global restructuring program is also reducing our European manufacturing capacity and streamlining our global operations by, among other things, executing a back office process transformation program in Europe. The restructuring in Europe is in process and has resulted in year to date severance and benefit charges of $6.8 million. We have also incurred other costs associated with the global restructuring program of $4.6 million related to legal and professional fees, temporary labor, project management, and other administrative functions. We expect to incur $15 million to $20 million of additional restructuring costs related to this action over the next two years. | |||||||||||||||||||||
Also during the second quarter of fiscal 2014, we initiated a plan to discontinue third-party payer rentals of therapy products occurring primarily in home care settings. We intend to continue renting these products to facilities and customers who are billed directly for the product. Due to this action, we recorded a non-cash impairment charge of $7.7 million for certain tangible assets for which the carrying values could not be fully recovered as a result of this strategic decision. We also eliminated approximately 70 positions and recognized a special charge of $2.0 million related to severance and other benefits for affected employees and $1.8 million in other related costs. Over the remainder of the fiscal year, we reversed $0.2 million of the other related costs as original estimates changed. The exit of this business is substantially complete by the first quarter of fiscal 2015, but certain cash expenditures will extend into fiscal 2015. | |||||||||||||||||||||
During the first quarter of fiscal 2014, we initiated a plan to improve our cost structure and streamline our organization by offering an early retirement program to certain manufacturing employees in our Batesville, Indiana plant, meeting specific eligibility requirements, and other minor reduction in force actions. These programs resulted in the elimination of approximately 35 positions and required recognition of a special charge of approximately $1 million for lump sum payments under the program and severance and other benefits provided to other affected employees. This action was substantially complete by the end of the second quarter of fiscal 2014. | |||||||||||||||||||||
2013 Actions | |||||||||||||||||||||
During the second quarter of fiscal 2013, we announced a plan to improve our cost structure and streamline our organization by eliminating in excess of 100 positions across the Company, roughly half of which were contract and open positions. This resulted in a special charge of $1.7 million related to severance and other benefits to be provided to affected employees. We also incurred a contract termination charge of $0.6 million, a non-cash asset impairment charge of $0.2 million related to a product discontinuance action and $1.0 million in other related costs. We reversed $0.6 million of a fiscal 2012 severance and other benefits charge that was determined to be excessive during the second quarter of fiscal 2013. During the third and fourth quarters of fiscal 2013, we continued actions under the previously announced plan and incurred charges of $0.8 million and $2.0 million, respectively. These actions and the related cash expenditures are substantially complete. | |||||||||||||||||||||
2012 Actions | |||||||||||||||||||||
During the fourth quarter of fiscal 2012, we recorded a non-cash impairment charge of $4.7 million for certain tangible assets for which the carrying values could not be fully recovered as a result of strategic decisions made relative to the exiting of underperforming portions of our home care business. Also associated with this action was the elimination of approximately 100 positions and the related charge of $1.0 million, primarily related to severance and other benefits to be provided to the affected employees. These actions and the related cash expenditures were completed by the end of fiscal year 2013. | |||||||||||||||||||||
During the second quarter of fiscal 2012, we announced a plan to improve our cost structure and streamline our organization by, among other things, eliminating approximately 200 positions across the Company resulting in a special charge of $9.3 million, net of reversals, recognized throughout fiscal 2012 primarily related to severance and other benefits to be provided to the affected employees. We also recorded an impairment of certain tangible assets for which the carrying values could not be fully recovered as a result of various strategic decisions, which resulted in a non-cash charge of $3.2 million. In addition, we recorded a non-cash impairment charge of $8.0 million related to a previously acquired trade name whose assessment was triggered by strategic changes in how the asset would be utilized on a go-forward basis. These actions and the related cash expenditures were completed by the end of fiscal year 2013. | |||||||||||||||||||||
Severance activity related to these actions during fiscal 2014 was as follows: | |||||||||||||||||||||
Beginning | Ending | ||||||||||||||||||||
Balance | Balance | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | Expenses | Cash Payments | Reversals | 2014 | |||||||||||||||||
Fiscal 2014 Actions | $ | - | $ | 20.8 | $ | (8.6 | ) | $ | (0.7 | ) | $ | 11.5 | |||||||||
Prior Restructuring Actions | 2.9 | - | (2.6 | ) | (0.1 | ) | 0.2 | ||||||||||||||
Total | $ | 2.9 | $ | 20.8 | $ | (11.2 | ) | $ | (0.8 | ) | $ | 11.7 |
INCOME_TAXES
INCOME TAXES | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||
INCOME TAXES [Abstract] | ' | ||||||||||||||||||||||||
INCOME TAXES | ' | ||||||||||||||||||||||||
NOTE 9. INCOME TAXES | |||||||||||||||||||||||||
The significant components of income before income taxes and the consolidated income tax provision were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Income before income taxes: | |||||||||||||||||||||||||
Domestic | $ | 87 | $ | 120 | $ | 148.6 | |||||||||||||||||||
Foreign | 28.2 | 24 | 14.9 | ||||||||||||||||||||||
Total | $ | 115.2 | $ | 144 | $ | 163.5 | |||||||||||||||||||
Income tax expense: | |||||||||||||||||||||||||
Current provision | |||||||||||||||||||||||||
Federal | $ | 40.2 | $ | 45 | $ | 65.9 | |||||||||||||||||||
State | 3.1 | 1.8 | 4.3 | ||||||||||||||||||||||
Foreign | 7.4 | 7 | 4.8 | ||||||||||||||||||||||
Total current provision | 50.7 | 53.8 | 75 | ||||||||||||||||||||||
Deferred provision: | |||||||||||||||||||||||||
Federal | (12.2 | ) | (9.9 | ) | (29.2 | ) | |||||||||||||||||||
State | (1.0 | ) | 1.1 | 0.1 | |||||||||||||||||||||
Foreign | 17.1 | (6.0 | ) | (3.2 | ) | ||||||||||||||||||||
Total deferred provision | 3.9 | (14.8 | ) | (32.3 | ) | ||||||||||||||||||||
Income tax expense | $ | 54.6 | $ | 39 | $ | 42.7 | |||||||||||||||||||
Differences between income tax expense reported for financial reporting purposes and that computed based upon the application of the statutory U.S. Federal tax rate to the reported income before income taxes were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
% of | % of | % of | |||||||||||||||||||||||
Pretax | Pretax | Pretax | |||||||||||||||||||||||
Amount | Income | Amount | Income | Amount | Income | ||||||||||||||||||||
Federal income tax (a) | $ | 40.3 | 35 | $ | 50.4 | 35 | $ | 57.2 | 35 | ||||||||||||||||
State income tax (b) | 2 | 1.7 | 2.5 | 1.7 | 3.5 | 2.2 | |||||||||||||||||||
Foreign income tax (c) | (7.7 | ) | (6.7 | ) | (5.7 | ) | (4.0 | ) | (3.4 | ) | (2.1 | ) | |||||||||||||
International tax restructuring | - | - | (0.8 | ) | (0.6 | ) | (11.0 | ) | (6.7 | ) | |||||||||||||||
Application of federal tax credits | (0.6 | ) | (0.5 | ) | (3.5 | ) | (2.4 | ) | (0.6 | ) | (0.4 | ) | |||||||||||||
Adjustment of estimated income tax accruals | (0.6 | ) | (0.5 | ) | (1.5 | ) | (1.0 | ) | (2.1 | ) | (1.3 | ) | |||||||||||||
Valuation of tax attributes | 21.3 | 18.5 | 0.6 | 0.4 | 0.3 | 0.2 | |||||||||||||||||||
Other, net | (0.1 | ) | (0.1 | ) | (3.0 | ) | (2.0 | ) | (1.2 | ) | (0.8 | ) | |||||||||||||
Income tax expense | $ | 54.6 | 47.4 | $ | 39 | 27.1 | $ | 42.7 | 26.1 | ||||||||||||||||
(a) | At statutory rate. | ||||||||||||||||||||||||
(b) | Net of Federal benefit. | ||||||||||||||||||||||||
(c) | Federal tax rate differential. | ||||||||||||||||||||||||
. | |||||||||||||||||||||||||
The tax effect of temporary differences that gave rise to the deferred tax balance sheet accounts were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Deferred tax assets: | |||||||||||||||||||||||||
Employee benefit accruals | $ | 49.3 | $ | 46.6 | |||||||||||||||||||||
Inventory | 13.9 | 7.4 | |||||||||||||||||||||||
Reserve for bad debts | 10 | 10.1 | |||||||||||||||||||||||
Accrued warranty | 7.3 | 9.7 | |||||||||||||||||||||||
Net operating loss carryforwards | 40.3 | 38.3 | |||||||||||||||||||||||
Tax credit carryforwards | 2.5 | 2 | |||||||||||||||||||||||
Other, net | 18.4 | 16.3 | |||||||||||||||||||||||
141.7 | 130.4 | ||||||||||||||||||||||||
Less: Valuation allowance | (28.3 | ) | (8.9 | ) | |||||||||||||||||||||
Total deferred tax assets | 113.4 | 121.5 | |||||||||||||||||||||||
Deferred tax liabilities: | |||||||||||||||||||||||||
Depreciation | (13.9 | ) | (32.1 | ) | |||||||||||||||||||||
Amortization | (62.8 | ) | (67.5 | ) | |||||||||||||||||||||
Other, net | (4.9 | ) | (3.2 | ) | |||||||||||||||||||||
Total deferred tax liabilities | (81.6 | ) | (102.8 | ) | |||||||||||||||||||||
Deferred tax asset - net | $ | 31.8 | $ | 18.7 | |||||||||||||||||||||
At September 30, 2014, we had $37.4 million of deferred tax assets related to operating loss carryforwards in foreign jurisdictions that are subject to various carryforward periods with the majority eligible to be carried forward for an unlimited period. Additionally, we had $2.0 million of deferred tax assets related to federal net operating loss carryforwards which will expire in 2033 and $0.9 million of deferred tax assets related to state net operating loss carryforwards, which expire between 2018 and 2026. We had $2.5 million of deferred tax assets related to state tax credits, which expire between 2014 and 2026. | |||||||||||||||||||||||||
The gross deferred tax assets as of September 30, 2014 were reduced by valuation allowances of $28.3 million primarily related to certain foreign deferred tax attributes as it is more likely than not that some portion or all of these tax attributes will not be realized. In evaluating whether it is more likely than not that we would recover our deferred tax assets, future taxable income, the reversal of existing temporary differences and tax planning strategies were considered. We believe that our estimates for the valuation allowances recorded against deferred tax assets are appropriate based on current facts and circumstances. | |||||||||||||||||||||||||
We operate under tax holidays in both Singapore and Puerto Rico. The Singapore tax holiday is effective through 2016 while the Puerto Rico tax holiday is effective through 2025. Both incentives are conditional on meeting certain employment and/or investment thresholds. The impact of these tax holidays decreased foreign taxes by $4.0 million in fiscal 2014, $2.9 million for fiscal 2013 and $1.7 million for fiscal 2012. The benefit of the tax holidays on net income per share (diluted) was $0.07, $0.05 and $0.03 for fiscal 2014, 2013 and 2012, respectively. | |||||||||||||||||||||||||
We file a consolidated federal income tax return as well as multiple state, local and foreign jurisdiction tax returns. In the normal course of business, we are subject to examination by the taxing authorities in each of the jurisdictions where we file tax returns. During fiscal 2014, the Internal Revenue Service (“IRS”) concluded its audit for fiscal year 2012 and initiated its post-filing examination of the fiscal 2013 consolidated federal return. We continue to participate in the IRS Compliance Assurance Program (“CAP”) for fiscal year 2014 and have submitted the application to remain in the CAP for fiscal years 2015 and 2016. The CAP provides the opportunity for the IRS to review certain tax matters prior to us filing our tax return for the year, thereby reducing the time it takes to complete the post-filing examination. We are also subject to state and local or foreign income tax examinations by taxing authorities for years back to fiscal 2008. | |||||||||||||||||||||||||
We also have on-going audits in various stages of completion in several state and foreign jurisdictions, one or more of which may conclude within the next 12 months. Such settlements could involve some or all of the following: the payment of additional taxes, the adjustment of certain deferred taxes and/or the recognition of unrecognized tax benefits. The resolution of these matters, in combination with the expiration of certain statutes of limitations in various jurisdictions, make it reasonably possible that our unrecognized tax benefits may decrease as a result of either payment or recognition by approximately $3 to $4 million in the next twelve months, excluding interest. | |||||||||||||||||||||||||
The total amount of gross unrecognized tax benefits as of September 30, 2014, 2013 and 2012 was $4.1 million, $4.6 million and $9.8 million, which includes $2.7 million, $3.9 million and $8.4 million that, if recognized, would impact the effective tax rate in future periods. The remaining amount relates to items which, if recognized, would not impact our effective tax rate. | |||||||||||||||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Balance at October 1 | $ | 4.6 | $ | 9.8 | $ | 17.8 | |||||||||||||||||||
Increases in tax position of prior years | 2.1 | - | 0.5 | ||||||||||||||||||||||
Decreases in tax position of prior years | (0.9 | ) | (0.5 | ) | (2.7 | ) | |||||||||||||||||||
Increases in tax positions related to the current year | - | 0.1 | - | ||||||||||||||||||||||
Settlements with taxing authorities | (0.1 | ) | (3.2 | ) | (3.8 | ) | |||||||||||||||||||
Lapse of applicable statute of limitations | (1.5 | ) | (1.7 | ) | (1.9 | ) | |||||||||||||||||||
Foreign currency adjustments | (0.1 | ) | 0.1 | (0.1 | ) | ||||||||||||||||||||
Total change | (0.5 | ) | (5.2 | ) | (8.0 | ) | |||||||||||||||||||
Balance at September 30 | $ | 4.1 | $ | 4.6 | $ | 9.8 | |||||||||||||||||||
We recognize accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. Accrued interest and penalties, which are not presented in the reconciliation table above, were $0.4 million, $0.6 million and $0.8 million at September 30, 2014, 2013 and 2012. Related to interest and penalties, we recognized an income tax benefit (expense) of $0.2 million in 2014, $0.1 million in 2013 and less than $0.1 million in 2012. |
EARNINGS_PER_COMMON_SHARE
EARNINGS PER COMMON SHARE | 12 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
EARNINGS PER COMMON SHARE [Abstract] | ' | ||||||||||||
EARNINGS PER COMMON SHARE | ' | ||||||||||||
NOTE 10. EARNINGS PER COMMON SHARE | |||||||||||||
Basic earnings per share is calculated based upon the weighted average number of outstanding common shares for the period, plus the effect of deferred vested shares. Diluted earnings per share is calculated consistent with the basic earnings per share calculation plus the effect of dilutive unissued common shares related to stock-based employee compensation programs. For all years presented, anti-dilutive stock options were excluded from the calculation of dilutive earnings per share. Excluded shares were 0.3 million, 1.4 million and 1.4 million for fiscal years 2014, 2013 and 2012. Cumulative treasury stock acquired, less cumulative shares reissued, have been excluded in determining the average number of shares outstanding. | |||||||||||||
Earnings per share is calculated as follows: | |||||||||||||
Years Ended September 30 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income attributable to common shareholders | $ | 60.6 | $ | 105 | $ | 120.8 | |||||||
Average shares outstanding - Basic (thousands) | 57,555 | 59,910 | 62,120 | ||||||||||
Add potential effect of exercise of stock options | |||||||||||||
and other unvested equity awards (thousands) | 968 | 340 | 241 | ||||||||||
Average shares outstanding - Diluted (thousands) | 58,523 | 60,250 | 62,361 | ||||||||||
Net income per common share - Basic | $ | 1.05 | $ | 1.75 | $ | 1.94 | |||||||
Net income per common share - Diluted | $ | 1.04 | $ | 1.74 | $ | 1.94 | |||||||
SEGMENT_REPORTING
SEGMENT REPORTING | 12 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
SEGMENT REPORTING [Abstract] | ' | ||||||||||||
SEGMENT REPORTING | ' | ||||||||||||
NOTE 11. SEGMENT REPORTING | |||||||||||||
We disclose segment information that is consistent with the way in which management operates and views the business. Beginning in fiscal 2014, we changed our definition of divisional income within our internal reporting to management to exclude the impacts of acquisition-related intangible asset amortization. As a result, we have changed our segment reporting to reflect the way management views the business. The prior year segment information included below has been updated to reflect these changes. | |||||||||||||
Our operating structure consists of the following three reporting segments: | |||||||||||||
North America - sells and rents our patient support and near-patient technologies and services, as well as our health information technology solutions, in the U.S. and Canada. | |||||||||||||
Surgical and Respiratory Care - sells and rents our surgical and respiratory care products globally. | |||||||||||||
International - sells and rents similar products as our North America segment in regions outside of the U.S. and Canada. | |||||||||||||
Our performance under each reportable segment is measured on a divisional income basis before non-allocated operating and administrative costs, impairment of other intangibles, litigation, special charges, and acquisition-related intangible asset amortization. Divisional income generally represents the division's gross profit less its direct operating costs along with an allocation of manufacturing and distribution costs, research and development and certain corporate functional expenses. | |||||||||||||
Non-allocated operating and administrative costs include functional expenses that support the entire organization such as administration, finance, legal and human resources, expenses associated with strategic developments, acquisition-related intangible asset amortization, and other events that are not indicative of operating trends. We exclude such amounts from divisional income to allow management to evaluate and understand divisional operating trends without the effects of such items. | |||||||||||||
Years Ended September 30 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Revenue: | |||||||||||||
North America | $ | 888.9 | $ | 958.3 | $ | 998.2 | |||||||
Surgical and Respiratory Care | 301.6 | 245.8 | 153.2 | ||||||||||
International | 495.6 | 512.1 | 482.9 | ||||||||||
Total revenue | $ | 1,686.10 | $ | 1,716.20 | $ | 1,634.30 | |||||||
Divisional income: | |||||||||||||
North America | $ | 165 | $ | 201.7 | $ | 215.4 | |||||||
Surgical and Respiratory Care | 68.6 | 56.8 | 43.9 | ||||||||||
International | 24.9 | 33.5 | 31.4 | ||||||||||
Other operating costs: | |||||||||||||
Non-allocated operating and administrative costs | 98.8 | 131.4 | 99.3 | ||||||||||
Impairment of other intangibles | - | - | 8 | ||||||||||
Litigation credit | - | - | (3.6 | ) | |||||||||
Special charges | 37.1 | 5.7 | 18.2 | ||||||||||
Operating profit | 122.6 | 154.9 | 168.8 | ||||||||||
Interest expense | (9.8 | ) | (9.5 | ) | (6.5 | ) | |||||||
Investment income and other, net | 2.4 | (1.4 | ) | 1.2 | |||||||||
Income before income taxes | $ | 115.2 | $ | 144 | $ | 163.5 | |||||||
Geographic Information | |||||||||||||
Geographic data for net revenue and long-lived assets (which consist mainly of property and equipment leased to others) were as follows: | |||||||||||||
Years Ended September 30 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net revenue to unaffiliated customers: (a) | |||||||||||||
United States | $ | 1,070.80 | $ | 1,116.40 | $ | 1,077.80 | |||||||
Foreign | 615.3 | 599.8 | 556.5 | ||||||||||
Total revenue | $ | 1,686.10 | $ | 1,716.20 | $ | 1,634.30 | |||||||
Long-lived assets: (b) | |||||||||||||
United States | $ | 151.7 | $ | 158 | $ | 172.5 | |||||||
Foreign | 109.8 | 76.3 | 77.6 | ||||||||||
Total long-lived assets | $ | 261.5 | $ | 234.3 | $ | 250.1 | |||||||
(a) | |||||||||||||
Net revenue is attributed to geographic areas based on the location of the customer. | |||||||||||||
(b) | |||||||||||||
Includes property and equipment leased to others. | |||||||||||||
QUARTERLY_FINANCIAL_INFORMATIO
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) [Abstract] | ' | ||||||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | ' | ||||||||||||||||
NOTE 12. QUARTERLY FINANCIAL INFORMATION (UNAUDITED) | |||||||||||||||||
The following table presents selected consolidated financial data by quarter for each of the last two fiscal years. | |||||||||||||||||
2014 Quarter Ended | December 31, | March 31, | June 30, | September 30, | |||||||||||||
2013 | 2014 | 2014 | 2014 | ||||||||||||||
Net revenue | $ | 393.4 | $ | 415.3 | $ | 397.6 | $ | 479.8 | |||||||||
Gross profit | $ | 176.8 | $ | 202.7 | $ | 187.1 | $ | 213.3 | |||||||||
Net income (loss) | $ | 13.2 | $ | (3.3 | ) | $ | 26.1 | $ | 24.6 | ||||||||
Basic net income (loss) per common share | $ | 0.23 | $ | (0.06 | ) | $ | 0.46 | $ | 0.43 | ||||||||
Diluted net income (loss) per common share | $ | 0.22 | $ | (0.06 | ) | $ | 0.45 | $ | 0.42 | ||||||||
2013 Quarter Ended | December 31, | March 31, | June 30, | September 30, 2013 | |||||||||||||
2012 | 2013 | 2013 | |||||||||||||||
Net revenue | $ | 428.4 | $ | 425.7 | $ | 424.2 | $ | 437.9 | |||||||||
Gross profit | $ | 191.4 | $ | 196.1 | $ | 190.1 | $ | 202.7 | |||||||||
Net income | $ | 24 | $ | 22.3 | $ | 23.4 | $ | 35.3 | |||||||||
Basic net income per common share | $ | 0.39 | $ | 0.37 | $ | 0.39 | $ | 0.6 | |||||||||
Diluted net income per common share | $ | 0.39 | $ | 0.37 | $ | 0.39 | $ | 0.59 |
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended | ||||
Sep. 30, 2014 | |||||
COMMITMENTS AND CONTINGENCIES [Abstract] | ' | ||||
COMMITMENTS AND CONTINGENCIES | ' | ||||
NOTE 13. COMMITMENTS AND CONTINGENCIES | |||||
Lease Commitments | |||||
Rental expense for fiscal years 2014, 2013 and 2012 was $24.7 million, $21.5 million and $20.7 million. The table below indicates the minimum annual rental commitments (excluding renewable periods) aggregating $62.9 million, for manufacturing facilities, warehouse distribution centers, service centers and sales offices, under non-cancelable operating leases. | |||||
Amount | |||||
2015 | $ | 22.5 | |||
2016 | $ | 16.6 | |||
2017 | $ | 12.5 | |||
2018 | $ | 6.9 | |||
2019 | $ | 1.7 | |||
2020 and beyond | $ | 2.7 | |||
Self Insurance | |||||
We are also involved in other possible claims, including product and general liability, workers' compensation, auto liability and employment related matters. Such claims in the United States have deductibles and self-insured retentions ranging from $25 thousand to $1.0 million per occurrence or per claim, depending upon the type of coverage and policy period. International deductibles and self-insured retentions are lower. We are also generally self-insured up to certain stop-loss limits for certain employee health benefits, including medical, drug and dental. Our policy is to estimate reserves based upon a number of factors including known claims, estimated incurred but not reported claims and outside actuarial analysis, which are based on historical information along with certain assumptions about future events. Such estimated reserves are classified as Other Current Liabilities and Other Long-Term Liabilities within the Consolidated Balance Sheets. | |||||
Legal Proceedings | |||||
Stryker Litigation | |||||
On April 4, 2011, we filed two separate actions against Stryker Corporation alleging infringement of certain Hill-Rom patents covering proprietary communications networks, status information systems and powered wheels used in our beds or stretchers. Both suits sought monetary damages and injunctions against Stryker for selling or distributing any beds, stretchers or ancillary products that infringe Hill-Rom's patents. On August 14, 2012, we entered into a confidential favorable settlement agreement with Stryker Corporation to resolve our lawsuit regarding claims about our powered wheel patents. No trial date for the remaining lawsuit has been set. Because the litigation is in a preliminary stage, we cannot assess the likelihood of a positive or negative outcome or determine an estimate, or a range of estimates, of potential damages, nor can we give any assurances that this matter will not have a material adverse impact on our financial condition, results of operations or cash flows. | |||||
General | |||||
We are subject to various other claims and contingencies arising out of the normal course of business, including those relating to governmental investigations and proceedings, commercial transactions, product liability, employee related matters, antitrust, safety, health, taxes, environmental and other matters. Litigation is subject to many uncertainties and the outcome of individual litigated matters is not predictable with assurance. It is possible that some litigation matters for which reserves have not been established could be decided unfavorably to us, and that any such unfavorable decisions could have a material adverse effect on our financial condition, results of operations and cash flows. |
Valuation_and_Qualifying_Accou
Valuation and Qualifying Accounts | 12 Months Ended | ||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ' | ||||||||||||||||||||||
Valuation and Qualifying Accounts | ' | ||||||||||||||||||||||
Valuation and Qualifying Accounts | |||||||||||||||||||||||
For The Fiscal Years Ended September 30, 2014, 2013 and 2012 | |||||||||||||||||||||||
(Dollars in millions) | |||||||||||||||||||||||
ADDITIONS | |||||||||||||||||||||||
BALANCE AT | CHARGED TO | CHARGED TO | DEDUCTIONS | BALANCE | |||||||||||||||||||
BEGINNING | COSTS AND | OTHER | NET OF | AT END | |||||||||||||||||||
DESCRIPTION | OF PERIOD | EXPENSES | ACCOUNTS | RECOVERIES | OF PERIOD | ||||||||||||||||||
Reserves deducted from assets to which they apply: | |||||||||||||||||||||||
Allowance for possible losses and sales returns - | |||||||||||||||||||||||
accounts receivable: | |||||||||||||||||||||||
Period Ended: | |||||||||||||||||||||||
30-Sep-14 | $ | 30.1 | $ | 1.5 | $ | 8.6 | (a) | $ | (8.8 | ) | (b) | $ | 31.4 | ||||||||||
30-Sep-13 | $ | 38.5 | $ | 2.7 | $ | (0.1 | ) | (a) | $ | (11.0 | ) | (b) | $ | 30.1 | |||||||||
30-Sep-12 | $ | 26.7 | $ | 1.6 | $ | 18.5 | (a) | $ | (8.3 | ) | (b) | $ | 38.5 | ||||||||||
Allowance for inventory valuation: | |||||||||||||||||||||||
Period Ended: | |||||||||||||||||||||||
30-Sep-14 | $ | 22 | $ | 4 | $ | 19.8 | (c) | $ | (2.9 | ) | (d) | $ | 42.9 | ||||||||||
30-Sep-13 | $ | 22 | $ | 1.8 | $ | - | (c) | $ | (1.8 | ) | (d) | $ | 22 | ||||||||||
30-Sep-12 | $ | 22.9 | $ | 2.2 | $ | 1.6 | (c) | $ | (4.7 | ) | (d) | $ | 22 | ||||||||||
Valuation allowance against deferred tax assets: | |||||||||||||||||||||||
Period Ended: | |||||||||||||||||||||||
30-Sep-14 | $ | 8.9 | $ | 21.3 | $ | - | $ | (1.9 | ) | (e) | $ | 28.3 | |||||||||||
30-Sep-13 | $ | 8.6 | $ | 0.6 | $ | - | $ | (0.3 | ) | (e) | $ | 8.9 | |||||||||||
30-Sep-12 | $ | 8.1 | $ | 0.4 | $ | - | $ | 0.1 | (e) | $ | 8.6 | ||||||||||||
(a) | Reduction of gross revenue for uncollectible health care rental reimbursements, cash discounts and other adjustments in determining net revenue. Also includes the effect of acquired businesses, if any. | ||||||||||||||||||||||
(b) | Generally reflects the write-off of specific receivables against recorded reserves. | ||||||||||||||||||||||
(c) | Generally reflects the effect of acquired businesses, if any. | ||||||||||||||||||||||
(d) | Generally reflects the write-off of specific inventory against recorded reserves. | ||||||||||||||||||||||
(e) | Primarily reflects write-offs of deferred tax assets against the valuation allowance and other movement of the valuation allowance offset by an opposing change in deferred tax assets. | ||||||||||||||||||||||
SUMMARY_OF_SIGNIFICANT_ACCOUNT1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ' | ||||||||||||||||
Nature of Operations | ' | ||||||||||||||||
Nature of Operations | |||||||||||||||||
Hill-Rom Holdings, Inc. (the “Company,” “Hill-Rom,” “we,” “us,” or “our”) was incorporated on August 7, 1969 in the State of Indiana and is headquartered in Batesville, Indiana. We are a leading global medical technology company with more than 7,000 employees worldwide. We partner with health care providers in more than 100 countries by focusing on patient care solutions that improve clinical and economic outcomes in five core areas: Advancing Mobility, Wound Care and Prevention, Clinical Workflow, Surgical Safety and Efficiency, and Respiratory Health. Around the world, Hill-Rom's people, products, and programs work towards one mission: Enhancing outcomes for patients and their caregivers. | |||||||||||||||||
Basis of Presentation and Principles of Consolidation | ' | ||||||||||||||||
Basis of Presentation and Principles of Consolidation | |||||||||||||||||
The Consolidated Financial Statements include the accounts of Hill-Rom and its subsidiaries. All subsidiaries are wholly-owned as of September 30, 2014. Intercompany accounts and transactions have been eliminated in consolidation and certain prior year amounts have been reclassified to conform to current year presentation. | |||||||||||||||||
Use of Estimates | ' | ||||||||||||||||
Use of Estimates | |||||||||||||||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. Examples of such estimates include our accounts receivable reserves (Note 1), accrued warranties (Note 1), the impairment of intangibles and goodwill (Note 3), income taxes (Notes 1 and 9) and commitments and contingencies (Note 13), among others. | |||||||||||||||||
Cash and Cash Equivalents | ' | ||||||||||||||||
Cash and Cash Equivalents | |||||||||||||||||
We consider investments in marketable securities and other highly liquid instruments with a maturity of three months or less at date of purchase to be cash equivalents. Investments which have no stated maturity are also considered cash equivalents. All of our marketable securities may be freely traded. | |||||||||||||||||
Trade Accounts Receivable | ' | ||||||||||||||||
Trade Accounts Receivable | |||||||||||||||||
Trade accounts receivable are recorded at the invoiced amount and do not bear interest, unless the transaction is an installment sale with payment terms exceeding one year. Reserves for uncollectible accounts represent our best estimate of the amount of probable credit losses and collection risk in our existing accounts receivable. We determine such reserves based on historical write-off experience by industry and reimbursement platform. Receivables are generally reviewed on a pooled basis based on historical collection experience for each reimbursement and receivable type. Receivables for capital sales transactions are also reviewed individually for collectability. Account balances are charged against the allowance when we believe it is probable the receivable will not be recovered. We do not have any off-balance sheet credit exposure related to our customers. If circumstances change, such as higher than expected claims denials, payment defaults, changes in our business composition or processes, adverse changes in general economic conditions, unfavorable impacts of austerity measures initiated by some governmental authorities, instability or disruption of credit markets, or an unexpected material adverse change in a major customer's or payor's ability to meet its obligations, our estimates of the realizability of trade receivables could be reduced by a material amount. | |||||||||||||||||
Within rental revenue, the domestic third-party payors' reimbursement process requires extensive documentation, which has had the effect of slowing both the billing and cash collection cycles relative to the rest of the business, and therefore, increasing total accounts receivable. Because of the extensive documentation required and the requirement to settle a claim with the primary payor prior to billing the secondary and/or patient portion of the claim, the collection period for a claim in a portion of our business may, in some cases, be extended. | |||||||||||||||||
We generally hold our trade accounts receivable until they are paid. Certain long-term receivables are occasionally sold to third parties; however, any recognized gain or loss on such sales has historically not been material. | |||||||||||||||||
Inventories | ' | ||||||||||||||||
Inventories | |||||||||||||||||
Inventories are valued at the lower of cost or market. Inventory costs are determined by the last-in, first-out (“LIFO”) method for approximately 36 and 47 percent of our inventories at September 30, 2014 and 2013. Costs for other inventories have been determined principally by the first-in, first-out (“FIFO”) method. Inventories consist of the following: | |||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Finished products | $ | 93.5 | $ | 66.3 | |||||||||||||
Work in process | 17.3 | 5.8 | |||||||||||||||
Raw materials | 65.4 | 46.2 | |||||||||||||||
Total | $ | 176.2 | $ | 118.3 | |||||||||||||
If the FIFO method of inventory accounting, which approximates current cost, had been used for all inventories, they would have been approximately $4.0 million and $3.2 million higher than reported at September 30, 2014 and 2013. | |||||||||||||||||
Property, Plant and Equipment | ' | ||||||||||||||||
Property, Plant and Equipment | |||||||||||||||||
Property, plant and equipment is recorded at cost and depreciated over the estimated useful life of the assets using principally the straight-line method. Ranges of estimated useful lives are as follows: | |||||||||||||||||
Useful Life | |||||||||||||||||
Land improvements | 6 - 15 years | ||||||||||||||||
Buildings and building equipment | 10 - 40 years | ||||||||||||||||
Machinery and equipment | 3 - 10 years | ||||||||||||||||
Equipment leased to others | 2 -10 years | ||||||||||||||||
When property, plant and equipment is retired from service or otherwise disposed of, the cost and related amount of depreciation or amortization are eliminated from the asset and accumulated depreciation accounts. The difference, if any, between the net asset value and the proceeds on sale are charged or credited to income. Total depreciation expense for fiscal years 2014, 2013 and 2012 was $65.4 million, $71.2 million and $73.9 million. The major components of property and the related accumulated depreciation were as follows: | |||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Accumulated | Accumulated | ||||||||||||||||
Cost | Depreciation | Cost | Depreciation | ||||||||||||||
Land and land improvements | $ | 19.4 | $ | 2.3 | $ | 14 | $ | 2.1 | |||||||||
Buildings and building equipment | 158.3 | 88.6 | 143.1 | 84.6 | |||||||||||||
Machinery and equipment | 321.3 | 213.7 | 288 | 198.8 | |||||||||||||
Equipment leased to others | 350.6 | 283.5 | 376.6 | 301.9 | |||||||||||||
Total | $ | 849.6 | $ | 588.1 | $ | 821.7 | $ | 587.4 | |||||||||
Intangible Assets | ' | ||||||||||||||||
Intangible Assets | |||||||||||||||||
Intangible assets are stated at cost and consist predominantly of goodwill, software, patents, trademarks, and acquired customer relationship assets. With the exception of goodwill and certain trademarks, our intangible assets are amortized on a straight-line basis over periods generally ranging from 3 to 20 years. | |||||||||||||||||
We assess the carrying value of goodwill and non-amortizable intangibles annually, during the third quarter of each fiscal year, or more often if events or changes in circumstances indicate there may be impairment. Goodwill is allocated among the reporting units based on the relative fair value of those units. | |||||||||||||||||
The majority of our goodwill and many of our intangible assets are not deductible for income tax purposes. A summary of intangible assets and the related accumulated amortization and impairment losses follows: | |||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Amortization | Amortization | ||||||||||||||||
Cost | and Impairment | Cost | and Impairment | ||||||||||||||
Goodwill | $ | 872.6 | $ | 472.8 | $ | 815.6 | $ | 472.8 | |||||||||
Software | 170.5 | 146.6 | 164.6 | 135.9 | |||||||||||||
Other | 373.9 | 136.7 | 336.4 | 112.4 | |||||||||||||
Total | $ | 1,417.00 | $ | 756.1 | $ | 1,316.60 | $ | 721.1 | |||||||||
Amortization expense for fiscal years 2014, 2013 and 2012 was $41.0 million, $45.6 million and $37.8 million. Amortization expense for all intangibles is expected to approximate the following for each of the next five fiscal years and thereafter: | |||||||||||||||||
Amount | |||||||||||||||||
2015 | $ | 40.9 | |||||||||||||||
2016 | $ | 38.3 | |||||||||||||||
2017 | $ | 28.5 | |||||||||||||||
2018 | $ | 23.8 | |||||||||||||||
2019 | $ | 18.8 | |||||||||||||||
2020 and beyond | $ | 77.9 | |||||||||||||||
Software consists mainly of capitalized costs associated with internal use software, including applicable costs associated with the implementation/upgrade of our Enterprise Resource Planning system. In addition, software includes capitalized development costs for software products to be sold. The net book value of computer software costs, included within intangible assets, was $23.9 million and $28.7 million at September 30, 2014 and 2013. Capitalized software costs are amortized on a straight-line basis over periods ranging from three to ten years. Software amortization expense approximated $11.5 million, $17.8 million and $20.7 million for fiscal years 2014, 2013 and 2012, and is included in the total intangibles amortization presented earlier. | |||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
Fair Value Measurements | |||||||||||||||||
Fair value measurements are classified and disclosed in one of the following three categories: | |||||||||||||||||
| Level 1: Financial instruments with unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets and liabilities. | ||||||||||||||||
| Level 2: Financial instruments with observable inputs other than those included in Level 1 such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | ||||||||||||||||
| Level 3: Financial instruments with unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Unobservable inputs reflect our own assumptions that market participants would use in pricing the asset or liability (including assumptions about risk). Unobservable inputs shall be developed based on the best information available in the circumstances, which might include our own data. | ||||||||||||||||
We record cash and cash equivalents, as disclosed on our Consolidated Balance Sheets, as Level 1 instruments and certain other insignificant derivatives and investments as either Level 2 or 3 instruments. Refer to Note 4 for disclosure of our debt instrument fair values. | |||||||||||||||||
Guarantees | ' | ||||||||||||||||
Guarantees | |||||||||||||||||
We routinely grant limited warranties on our products with respect to defects in material and workmanship. The terms of these warranties are generally one year, however, certain components and products have substantially longer warranty periods. We recognize a reserve with respect to these obligations at the time of product sale, with subsequent warranty claims recorded directly against the reserve. The amount of the warranty reserve is determined based on historical trend experience for the covered products. For more significant warranty-related matters which might require a broad-based correction, separate reserves are established when such events are identified and the cost of correction can be reasonably estimated. The warranty reserve for fiscal 2014 includes net field corrective action reversals of $1.7 million as further testing of previously reported issues and actual claims activity supported changes to our prior estimates. During fiscal 2013, we recognized charges of $12.2 million to cover the estimated costs associated with field corrective actions on five different product lines. We also recognized a charge of $16.0 million for a fiscal 2012 field corrective action on one of our med-surg product lines. These field corrective actions do not limit the manufacture, sale or ongoing use of these products. | |||||||||||||||||
A reconciliation of changes in our warranty reserve is as follows: | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Balance at October 1 | $ | 38.1 | $ | 42.2 | $ | 17.8 | |||||||||||
Provision for warranties during the period | 9.8 | 29.2 | 31.8 | ||||||||||||||
Warranty reserves acquired | 3 | (2.6 | ) | 9.7 | |||||||||||||
Warranty claims incurred during the period | (22.5 | ) | (30.7 | ) | (17.1 | ) | |||||||||||
Balance at September 30 | $ | 28.4 | $ | 38.1 | $ | 42.2 | |||||||||||
In the normal course of business we enter into various other guarantees and indemnities in our relationships with suppliers, service providers, customers, business partners and others. Examples of these arrangements would include guarantees of product performance, indemnifications to service providers and indemnifications of our actions to business partners. These guarantees and indemnifications have not historically nor do we expect them to have a material impact on our financial condition or results of operations, although indemnifications associated with our actions generally have no dollar limitations. | |||||||||||||||||
In conjunction with our acquisition and divestiture activities, we have entered into select guarantees and indemnifications of performance with respect to the fulfillment of our commitments under applicable purchase and sale agreements. The arrangements generally indemnify the buyer or seller for damages associated with breach of contract, inaccuracies in representations and warranties surviving the closing date and satisfaction of liabilities and commitments retained under the applicable contract. With respect to sale transactions, we also routinely enter into non-competition agreements for varying periods of time. Guarantees and indemnifications with respect to acquisition and divestiture activities, if triggered, could have a materially adverse impact on our financial condition and results of operations. | |||||||||||||||||
Employee Benefits Change | ' | ||||||||||||||||
Employee Benefits Change | |||||||||||||||||
During the second quarter of fiscal 2014, we implemented a new paid time off policy as part of our employee benefits programs, replacing certain previously existing vacation and sick time policies. In conjunction with these changes in policies, the vesting provisions with respect to the accumulation of paid time off were delayed resulting in the recognition and utilization of paid time off in the same benefits year. As a result of this change, significant portions of our existing accrued vacation balance were no longer necessary and we reversed $12.2 million in the second quarter of fiscal 2014 and an additional $1.2 million in the third quarter of fiscal 2014 to reflect the change in vesting provisions. All accounting with respect to this change in policy is now complete. | |||||||||||||||||
Retirement Plans | ' | ||||||||||||||||
Retirement Plans | |||||||||||||||||
We sponsor retirement and postretirement plans covering select employees. Expense recognized in relation to these defined benefit retirement plans and the postretirement health care plan in the U.S. is based upon actuarial valuations and inherent in those valuations are key assumptions including discount rates, and where applicable, expected returns on assets, projected future salary rates and projected health care cost trends. The discount rates used in the valuation of our defined benefit pension and postretirement plans are evaluated annually based on current market conditions. In setting these rates we utilize long-term bond indices and yield curves as a preliminary indication of interest rate movements, and then make adjustments to the respective indices to reflect differences in the terms of the bonds covered under the indices in comparison to the projected outflow of our obligations. Our overall expected long-term rate of return on pension assets is based on historical and expected future returns, which are inflation adjusted and weighted for the expected return for each component of the investment portfolio. Our rate of assumed compensation increase is also based on our specific historical trends of wage adjustments. | |||||||||||||||||
We account for our defined benefit pension and other postretirement plans by recognizing the funded status of a benefit plan in the statement of financial position. We also recognize in accumulated other comprehensive income (loss) certain gains and losses that arose during the period. See Note 6 for key assumptions and further discussion related to our pension and postretirement plans. | |||||||||||||||||
Environmental Liabilities | ' | ||||||||||||||||
Environmental Liabilities | |||||||||||||||||
Expenditures that relate to an existing condition caused by past operations, and which do not contribute to future revenue generation, are expensed. A reserve is established when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These reserves are determined without consideration of possible loss recoveries from third parties. | |||||||||||||||||
Specific costs included in environmental expense and reserves include site assessment, development of a remediation plan, clean-up costs, post-remediation expenditures, monitoring, fines, penalties and legal fees. Reserve amounts represent the expected undiscounted future cash outflows associated with such plans and actions. | |||||||||||||||||
Self Insurance | ' | ||||||||||||||||
Self Insurance | |||||||||||||||||
We are also involved in other possible claims, including product and general liability, workers' compensation, auto liability and employment related matters. Such claims in the United States have deductibles and self-insured retentions ranging from $25 thousand to $1.0 million per occurrence or per claim, depending upon the type of coverage and policy period. International deductibles and self-insured retentions are lower. We are also generally self-insured up to certain stop-loss limits for certain employee health benefits, including medical, drug and dental. Our policy is to estimate reserves based upon a number of factors including known claims, estimated incurred but not reported claims and outside actuarial analysis, which are based on historical information along with certain assumptions about future events. Such estimated reserves are classified as Other Current Liabilities and Other Long-Term Liabilities within the Consolidated Balance Sheets. | |||||||||||||||||
Revenue Recognition - Sales and Rentals | ' | ||||||||||||||||
Revenue Recognition — Sales and Rentals | |||||||||||||||||
Net revenue reflects gross revenue less sales discounts and allowances and customer returns for product sales and rental revenue reserves. Revenue is evaluated under the following criteria and recognized when each is met: | |||||||||||||||||
• Evidence of an arrangement: An agreement with the customer reflecting the terms and conditions to deliver products or services serves as evidence of an arrangement. | |||||||||||||||||
• Delivery: For products, delivery is considered to occur upon receipt by the customer and the transfer of title and risk of loss. For rental services, delivery is considered to occur when the services are rendered. | |||||||||||||||||
• Fixed or determinable price: The sales price is considered fixed or determinable if it is not subject to refund or adjustment. | |||||||||||||||||
• Collection is deemed probable: At or prior to the time of a transaction, credit reviews of each customer are performed to determine the creditworthiness of the customer. Collection is deemed probable if the customer is expected to be able to pay amounts under the arrangement as those amounts become due. If collection is not probable, revenue is recognized when collection becomes probable, generally upon cash collection. | |||||||||||||||||
As a general interpretation of the above guidelines, revenue for health care and surgical products is generally recognized upon delivery of the products to the customer and their assumption of risk of loss and other risks and rewards of ownership. Local business customs and non-standard sales terms can sometimes result in deviations to this normal practice in certain instances; however, in no case is revenue recognized prior to the transfer of risk of loss and rewards of ownership. | |||||||||||||||||
For non-invasive therapy products and medical equipment management services, the majority of product offerings are rental products for which revenue is recognized consistent with the rendering of the service and use of products. For The Vest® product, revenue is generally recognized at the time of receipt of authorization for billing from the applicable paying entity as this serves as evidence of the arrangement and sets a fixed or determinable price. | |||||||||||||||||
For health care products and services aimed at improving operational efficiency and asset utilization, various revenue recognition techniques are used, depending on the offering. Arrangements to provide services, routinely under separately sold service and maintenance contracts, result in the deferral of revenue until specified services are performed. Service contract revenue is generally recognized ratably over the contract period, if applicable, or as services are rendered. Product-related goods are generally recognized upon delivery to the customer. | |||||||||||||||||
Revenue is presented in the Statements of Consolidated Income net of certain discounts and sales adjustments. For product sales, we record reserves resulting in a reduction of revenue for contractual discounts, as well as price concessions and product returns. Likewise, rental revenue reserves, reflecting contractual and other routine billing adjustments, are recorded as a reduction of revenue. Reserves for revenue are estimated based upon historical rates for revenue adjustments. | |||||||||||||||||
Taxes Collected from Customers and Remitted to Governmental Units | ' | ||||||||||||||||
Taxes Collected from Customers and Remitted to Governmental Units | |||||||||||||||||
Taxes assessed by a governmental authority that are directly imposed on a revenue producing transaction between us and our customers, including but not limited to sales taxes, use taxes, and value added taxes, are accounted for on a net (excluded from revenue and cost) basis. | |||||||||||||||||
Cost of Revenue | ' | ||||||||||||||||
Cost of Revenue | |||||||||||||||||
Cost of goods sold for capital sales consists primarily of purchased material costs, fixed manufacturing expense, variable direct labor, overhead costs and costs associated with the distribution and delivery of products to our customers. Rental expenses consist of costs associated directly with rental revenue, including depreciation, maintenance, logistics and service center facility and personnel costs. | |||||||||||||||||
Research and Development Costs | ' | ||||||||||||||||
Research and Development Costs | |||||||||||||||||
Research and development costs are expensed as incurred. Costs were $71.9 million, $70.2 million and $66.9 million for fiscal years 2014, 2013 and 2012. | |||||||||||||||||
In addition, certain software development technology costs are capitalized as intangibles and are amortized over a period of three to five years once the software is ready for its intended use. The amount capitalized during fiscal years 2014, 2013 and 2012 was approximately $2.6 million, $2.4 million and $2.3 million. | |||||||||||||||||
Advertising Costs | ' | ||||||||||||||||
Advertising Costs | |||||||||||||||||
Advertising costs are expensed as incurred. Costs were $7.3 million, $7.4 million and $4.4 million for fiscal years 2014, 2013 and 2012. | |||||||||||||||||
Comprehensive Income | ' | ||||||||||||||||
Comprehensive Income | |||||||||||||||||
We include the net-of-tax effect of unrealized gains or losses on our available-for-sale securities, foreign currency translation adjustments and pension or other defined benefit postretirement plans' actuarial gains or losses and prior service costs or credits in comprehensive income. Please see Note 5. | |||||||||||||||||
Foreign Currency Translation | ' | ||||||||||||||||
Foreign Currency Translation | |||||||||||||||||
The functional currency of foreign operations is generally the local currency in the country of domicile. Assets and liabilities of foreign operations are primarily translated into U.S. dollars at year-end rates of exchange and the income statements are translated at the average rates of exchange prevailing during the year. Adjustments resulting from translation of the financial statements of foreign operations into U.S. dollars are excluded from the determination of net income, but included as a component of accumulated other comprehensive income (loss). Foreign currency gains and losses resulting from foreign currency transactions are included in our results of operations and are not material. | |||||||||||||||||
Stock-Based Compensation | ' | ||||||||||||||||
Stock-Based Compensation | |||||||||||||||||
We account for stock-based compensation under fair value provisions. Stock-based compensation cost is measured at the grant date based on the value of the award and is recognized as expense over the vesting period. In order to determine the fair value of stock options and other performance-based stock awards on the date of grant, we utilize a Binomial model. Inherent in this model are assumptions related to a volatility factor, expected life, risk-free interest rate, dividend yield and expected forfeitures. The risk-free interest rate is based on factual data derived from public sources. The volatility factor, expected life, dividend yield and expected forfeiture assumptions require judgment utilizing historical information, peer data and future expectations. Deferred stock (also known as restricted stock units (“RSUs”)) is measured based on the fair market price of our common stock on the date of grant, as reported by the New York Stock Exchange, multiplied by the number of units granted. See Note 7 for further details. | |||||||||||||||||
Income Taxes | ' | ||||||||||||||||
Income Taxes | |||||||||||||||||
The Company and our eligible domestic subsidiaries file a consolidated U.S. income tax return. Foreign operations file income tax returns in a number of jurisdictions. Deferred income taxes are computed using an asset and liability approach to reflect the net tax effects of temporary differences between the financial reporting carrying amounts of assets and liabilities and the corresponding income tax amounts. We have a variety of deferred tax assets in numerous tax jurisdictions. These deferred tax assets are subject to periodic assessment as to recoverability. If it is determined that it is more likely than not that the benefits will not be realized, valuation allowances are recognized. In evaluating whether it is more likely than not that we would recover these deferred tax assets, future taxable income, the reversal of existing temporary differences and tax planning strategies are considered. | |||||||||||||||||
We account for uncertain income tax positions using a threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The difference between the tax benefit recognized in the financial statements for an uncertain income tax position and the tax benefit claimed in the tax return is referred to as an unrecognized tax benefit. See Note 9 for further details. | |||||||||||||||||
Derivative Instruments and Hedging Activity | ' | ||||||||||||||||
Derivative Instruments and Hedging Activity | |||||||||||||||||
We use derivative financial instruments to manage the economic impact of fluctuations in currency exchange and interest rates. Derivative financial instruments related to currency exchange rates include forward purchase and sale agreements which generally have terms no greater than 15 months. Additionally, interest rate swaps are used to convert some or all of our long-term debt to either a fixed or variable rate. | |||||||||||||||||
Derivative financial instruments are recognized on the Consolidated Balance Sheets as either assets or liabilities and are measured at fair value. Changes in the fair value of derivatives are recorded each period in the Statement of Consolidated Income or the Statement of Consolidated Comprehensive Income, depending on whether a derivative is designated and considered effective as part of a hedge transaction, and if it is, the type of hedge transaction. Gains and losses on derivative instruments reported in accumulated other comprehensive income (loss) are subsequently included in the Statement of Consolidated Income in the periods in which earnings are affected by the hedged item. These activities have not had a material effect on our financial position or results of operations for the periods presented herein. | |||||||||||||||||
Recently Issued Accounting Guidance | ' | ||||||||||||||||
Recently Issued Accounting Guidance | |||||||||||||||||
In February 2013, an accounting standards update was issued that amends the reporting of amounts reclassified out of accumulated other comprehensive income (loss). This standard does not change the current requirements for reporting net income or other comprehensive income (loss) in the financial statements. However, the guidance requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income (loss) by component, either on the face of the financial statement where net income is presented or in the notes to the financial statements. The standard is effective for fiscal 2014. See Note 5 for disclosure of our reclassifications out of accumulated other comprehensive loss. | |||||||||||||||||
In May 2014, the FASB issued Accounting Standards Update (“ASU”) 2014-09, “Revenue from Contracts with Customers”, which provides guidance for revenue recognition. The standard's core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. This guidance will be effective for us in the first quarter of fiscal 2018, ending December 31, 2017. We are currently in the process of evaluating the impact of adoption of this ASU on our Consolidated Financial Statements. | |||||||||||||||||
Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company's consolidated financial statements upon adoption. |
SUMMARY_OF_SIGNIFICANT_ACCOUNT2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ' | ||||||||||||||||
Schedule of Inventories | ' | ||||||||||||||||
Inventories are valued at the lower of cost or market. Inventory costs are determined by the last-in, first-out (“LIFO”) method for approximately 36 and 47 percent of our inventories at September 30, 2014 and 2013. Costs for other inventories have been determined principally by the first-in, first-out (“FIFO”) method. Inventories consist of the following: | |||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Finished products | $ | 93.5 | $ | 66.3 | |||||||||||||
Work in process | 17.3 | 5.8 | |||||||||||||||
Raw materials | 65.4 | 46.2 | |||||||||||||||
Total | $ | 176.2 | $ | 118.3 | |||||||||||||
Schedule of Ranges of Estimated Useful Lives | ' | ||||||||||||||||
Property, plant and equipment is recorded at cost and depreciated over the estimated useful life of the assets using principally the straight-line method. Ranges of estimated useful lives are as follows: | |||||||||||||||||
Useful Life | |||||||||||||||||
Land improvements | 6 - 15 years | ||||||||||||||||
Buildings and building equipment | 10 - 40 years | ||||||||||||||||
Machinery and equipment | 3 - 10 years | ||||||||||||||||
Equipment leased to others | 2 -10 years | ||||||||||||||||
Schedule of Major Components of Property and Related Accumulated Depreciation | ' | ||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Accumulated | Accumulated | ||||||||||||||||
Cost | Depreciation | Cost | Depreciation | ||||||||||||||
Land and land improvements | $ | 19.4 | $ | 2.3 | $ | 14 | $ | 2.1 | |||||||||
Buildings and building equipment | 158.3 | 88.6 | 143.1 | 84.6 | |||||||||||||
Machinery and equipment | 321.3 | 213.7 | 288 | 198.8 | |||||||||||||
Equipment leased to others | 350.6 | 283.5 | 376.6 | 301.9 | |||||||||||||
Total | $ | 849.6 | $ | 588.1 | $ | 821.7 | $ | 587.4 | |||||||||
Schedule of Intangible Assets and Related Accumulated Amortization and Impairment Losses | ' | ||||||||||||||||
The majority of our goodwill and many of our intangible assets are not deductible for income tax purposes. A summary of intangible assets and the related accumulated amortization and impairment losses follows: | |||||||||||||||||
30-Sep | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Amortization | Amortization | ||||||||||||||||
Cost | and Impairment | Cost | and Impairment | ||||||||||||||
Goodwill | $ | 872.6 | $ | 472.8 | $ | 815.6 | $ | 472.8 | |||||||||
Software | 170.5 | 146.6 | 164.6 | 135.9 | |||||||||||||
Other | 373.9 | 136.7 | 336.4 | 112.4 | |||||||||||||
Total | $ | 1,417.00 | $ | 756.1 | $ | 1,316.60 | $ | 721.1 | |||||||||
Schedule of Expected Amortization Expense | ' | ||||||||||||||||
Amortization expense for fiscal years 2014, 2013 and 2012 was $41.0 million, $45.6 million and $37.8 million. Amortization expense for all intangibles is expected to approximate the following for each of the next five fiscal years and thereafter: | |||||||||||||||||
Amount | |||||||||||||||||
2015 | $ | 40.9 | |||||||||||||||
2016 | $ | 38.3 | |||||||||||||||
2017 | $ | 28.5 | |||||||||||||||
2018 | $ | 23.8 | |||||||||||||||
2019 | $ | 18.8 | |||||||||||||||
2020 and beyond | $ | 77.9 | |||||||||||||||
Reconciliation of Changes in Warranty Reserve | ' | ||||||||||||||||
A reconciliation of changes in our warranty reserve is as follows: | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Balance at October 1 | $ | 38.1 | $ | 42.2 | $ | 17.8 | |||||||||||
Provision for warranties during the period | 9.8 | 29.2 | 31.8 | ||||||||||||||
Warranty reserves acquired | 3 | (2.6 | ) | 9.7 | |||||||||||||
Warranty claims incurred during the period | (22.5 | ) | (30.7 | ) | (17.1 | ) | |||||||||||
Balance at September 30 | $ | 28.4 | $ | 38.1 | $ | 42.2 |
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 12 Months Ended | |||||
Sep. 30, 2014 | ||||||
Trumpf Medical [Member] | ' | |||||
Business Acquisition [Line Items] | ' | |||||
Schedule of Fair Value of the Assets Acquired and Liabilities Assumed | ' | |||||
The following summarizes the fair value of assets acquired and liabilities assumed at the date of the acquisition. These results are preliminary and subject to normal true-up provisions in the purchase agreement and other fair value adjustments. | ||||||
Amount | ||||||
Trade receivables | $ | 66.3 | ||||
Inventory | 64.4 | |||||
Other current assets | 24.0 | |||||
Property, plant, and equipment | 42.1 | |||||
Goodwill | 57.3 | |||||
Trade name (5-year useful life) | 6.7 | |||||
Customer relationships (10-year weighted average useful life) | 15.8 | |||||
Developed technology (8-year weighted average useful life) | 17.8 | |||||
Other intangibles | 4.8 | |||||
Other noncurrent assets | 0.7 | |||||
Deferred tax asset | 14.2 | |||||
Current liabilities | (70.1 | ) | ||||
Long term debt | (6.0 | ) | ||||
Noncurrent liabilities | (8.1 | ) | ||||
Total purchase price | $ | 229.9 | ||||
Virtus, Inc. [Member] | ' | |||||
Business Acquisition [Line Items] | ' | |||||
Schedule of Fair Value of the Assets Acquired and Liabilities Assumed | ' | |||||
The following summarizes the fair value of assets acquired and liabilities assumed at the date of the acquisition. During the third quarter of fiscal 2014, the remaining provisions of the stock purchase agreement were settled and the purchase price is now final. | ||||||
Amount | ||||||
Inventory | $ | 2.6 | ||||
Other current assets | 5.4 | |||||
Property, plant, and equipment | 1.9 | |||||
Goodwill | 9.4 | |||||
Current liabilities | (1.6 | ) | ||||
Deferred tax liability | (0.1 | ) | ||||
Total purchase price | $ | 17.6 | ||||
Aspen [Member] | ' | |||||
Business Acquisition [Line Items] | ' | |||||
Schedule of Fair Value of the Assets Acquired and Liabilities Assumed | ' | |||||
Throughout fiscal 2013, we made certain adjustments to the opening balance sheet as of the acquisition date as we finalized the purchase price with the seller. The following summarizes the revised fair value of assets acquired and liabilities assumed at the date of the acquisition. | ||||||
Amount | ||||||
Inventory | $ | 25.6 | ||||
Other current assets | 19.7 | |||||
Property, plant, and equipment | 24.6 | |||||
Goodwill | 220.1 | |||||
Trade name (Indefinite Lived) | 29 | |||||
Trade name (15-year weighted-average useful life) | 4.6 | |||||
Customer relationships (13-year weighted-average useful life) | 121.9 | |||||
Technology (10-year weighted-average useful life) | 9.1 | |||||
Other noncurrent assets | 1.6 | |||||
Current liabilities | (14.0 | ) | ||||
Deferred tax liability | (41.0 | ) | ||||
Total purchase price | $ | 401.2 | ||||
Volker [Member] | ' | |||||
Business Acquisition [Line Items] | ' | |||||
Schedule of Fair Value of the Assets Acquired and Liabilities Assumed | ' | |||||
Amount | ||||||
Goodwill | $ | 28.3 | ||||
Trade name (7-year useful life) | 12.3 | |||||
Customer relationships (8-year weighted average useful life) | 17.5 | |||||
Net assets acquired | 24.6 | |||||
Deferred tax liability | (9.5 | ) | ||||
Total purchase price | $ | 73.2 | ||||
GOODWILL_AND_INDEFINITELIVED_I1
GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS (Tables) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS [Abstract] | ' | ||||||||||||||||
Schedule of Goodwill Activity | ' | ||||||||||||||||
The following summarizes goodwill activity by reportable segment: | |||||||||||||||||
North America | Surgical and | International | Total | ||||||||||||||
Respiratory Care | |||||||||||||||||
Balances at September 30, 2012: | |||||||||||||||||
Goodwill | $ | 383 | $ | 271.5 | $ | 153.5 | $ | 808 | |||||||||
Accumulated impairment losses | (358.1 | ) | - | (114.7 | ) | (472.8 | ) | ||||||||||
Goodwill, net at September 30, 2012 | 24.9 | 271.5 | 38.8 | 335.2 | |||||||||||||
Changes in Goodwill during the period: | |||||||||||||||||
Goodwill related to acquisitions | - | 4.8 | (1.9 | ) | 2.9 | ||||||||||||
Currency translation effect | - | 2.7 | 2 | 4.7 | |||||||||||||
Balances at September 30, 2013: | |||||||||||||||||
Goodwill | 383 | 279 | 153.6 | 815.6 | |||||||||||||
Accumulated impairment losses | (358.1 | ) | - | (114.7 | ) | (472.8 | ) | ||||||||||
Goodwill, net at September 30, 2013 | 24.9 | 279 | 38.9 | 342.8 | |||||||||||||
Changes in Goodwill during the period: | |||||||||||||||||
Goodwill related to acquisitions | 7.6 | 57.3 | (2.8 | ) | 62.1 | ||||||||||||
Currency translation effect | - | (2.8 | ) | (2.3 | ) | (5.1 | ) | ||||||||||
Balances at September 30, 2014: | |||||||||||||||||
Goodwill | 390.6 | 333.5 | 148.5 | 872.6 | |||||||||||||
Accumulated impairment losses | (358.1 | ) | - | (114.7 | ) | (472.8 | ) | ||||||||||
Goodwill, net at September 30, 2014 | $ | 32.5 | $ | 333.5 | $ | 33.8 | $ | 399.8 | |||||||||
FINANCING_AGREEMENTS_Tables
FINANCING AGREEMENTS (Tables) | 12 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
FINANCING AGREEMENTS [Abstract] | ' | ||||||||
Schedule of Total Debt | ' | ||||||||
Total debt consists of the following: | |||||||||
30-Sep | |||||||||
2014 | 2013 | ||||||||
Revolving credit facility | 265 | 70 | |||||||
Term loan current portion | 16.2 | 11.2 | |||||||
Term loan long-term portion | 160 | 176.2 | |||||||
Unsecured 7.00% debentures due on February 15, 2024 | 19.4 | 19.6 | |||||||
Unsecured 6.75% debentures due on December 15, 2027 | 29.8 | 29.8 | |||||||
Other | 1.4 | 0.2 | |||||||
Total debt | 491.8 | 307 | |||||||
Less current portion of debt | 126.9 | 81.2 | |||||||
Total long-term debt | $ | 364.9 | $ | 225.8 | |||||
Schedule of Maturities of Long-Term Debt | ' | ||||||||
The following table summarizes the scheduled maturities of long-term debt for fiscal years 2015 through 2019: | |||||||||
Term Loan | |||||||||
2015 | $ | 16.2 | |||||||
2016 | $ | 20 | |||||||
2017 | $ | 140 | |||||||
2018 | $ | - | |||||||
2019 | $ | - |
OTHER_COMPREHENSIVE_INCOME_Tab
OTHER COMPREHENSIVE INCOME (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
Other Comprehensive Income [Abstract] | ' | ||||||||||||
Schedule of Changes in AOCL by Component | ' | ||||||||||||
Available-For-Sale | Foreign Currency | Changes in Pension | |||||||||||
Securities and Cash | Translation | and Postretirement | |||||||||||
Flow Hedges (1) | Adjustment (1) | Defined Benefit | |||||||||||
Plans (1) | |||||||||||||
Balance as of September 30, 2013 | $ | (0.3 | ) | $ | (4.6 | ) | $ | (30.8 | ) | ||||
OCI before reclassifications (2) | 0.2 | (29.6 | ) | (10.8 | ) | ||||||||
Amounts reclassified out of AOCL | 0.1 | - | 1.7 | ||||||||||
Net current period OCI | 0.3 | (29.6 | ) | (9.1 | ) | ||||||||
Balance as of September 30, 2014 | $ | - | $ | (34.2 | ) | $ | (39.9 | ) | |||||
(1) | All amounts are net of tax. | ||||||||||||
-2 | Net of tax of $(0.1), $0.0, and $6.0 for available-for-sale securities and cash flow hedges, foreign currency translation adjustment, and changes in pension and postretirement defined benefit plans, respectively. | ||||||||||||
Schedule of Items Reclassified out of AOCL | ' | ||||||||||||
Year End | |||||||||||||
30-Sep-14 | |||||||||||||
Pension and postretirement defined benefit plan items | |||||||||||||
Amortization of amounts included in net periodic pension expense and postretirement healthcare costs (1) | $ | 2.7 | |||||||||||
Tax expense | (1.0 | ) | |||||||||||
Net of tax | $ | 1.7 | |||||||||||
Available-for-sale securities and cash flow hedges items: | |||||||||||||
Recognition of other-than-temporary impairment on investment securities (2) | $ | 0.1 | |||||||||||
Tax expense | - | ||||||||||||
Net of tax | $ | 0.1 | |||||||||||
(1) | Reclassified from AOCL into cost of goods sold and selling and administrative expenses. These components are included in the computation of net periodic pension expense and postretirement healthcare costs. | ||||||||||||
-2 | Reclassified from AOCL into other income (expense), net. |
RETIREMENT_AND_POSTRETIREMENT_1
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||
Master Defined Benefit Retirement Plan [Member] | ' | ||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ' | ||||||||||||||||||||||||
Schedule of Components of Net Pension Expense | ' | ||||||||||||||||||||||||
The components of net periodic benefit cost for our defined benefit retirement plans were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Service cost | $ | 5 | $ | 6.1 | $ | 5.5 | |||||||||||||||||||
Interest cost | 14.4 | 13.2 | 13.3 | ||||||||||||||||||||||
Expected return on plan assets | (16.7 | ) | (15.9 | ) | (16.7 | ) | |||||||||||||||||||
Amortization of unrecognized prior service cost, net | 0.6 | 0.6 | 0.6 | ||||||||||||||||||||||
Amortization of net loss | 3.2 | 7.8 | 6.1 | ||||||||||||||||||||||
Net periodic benefit cost | 6.5 | 11.8 | 8.8 | ||||||||||||||||||||||
Special termination benefits | 2.4 | - | - | ||||||||||||||||||||||
Net pension expense | $ | 8.9 | $ | 11.8 | $ | 8.8 | |||||||||||||||||||
Schedule of Changes in Obligations, Assets and Funded Status | ' | ||||||||||||||||||||||||
The change in benefit obligations, plan assets and funded status, along with amounts recognized in the Consolidated Balance Sheets for our defined benefit retirement plans were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Change in benefit obligation: | |||||||||||||||||||||||||
Benefit obligation at beginning of year | $ | 297.9 | $ | 327.4 | |||||||||||||||||||||
Service cost | 5 | 6.1 | |||||||||||||||||||||||
Interest cost | 14.4 | 13.2 | |||||||||||||||||||||||
Actuarial loss (gain) | 31.4 | (41.1 | ) | ||||||||||||||||||||||
Benefits paid | (10.2 | ) | (9.1 | ) | |||||||||||||||||||||
Acquisitions | 4.3 | - | |||||||||||||||||||||||
Amendments | - | 0.6 | |||||||||||||||||||||||
Special termination benefits | 2.4 | - | |||||||||||||||||||||||
Exchange rate (gain) loss | (1.4 | ) | 0.8 | ||||||||||||||||||||||
Benefit obligation at end of year | 343.8 | 297.9 | |||||||||||||||||||||||
Change in plan assets: | |||||||||||||||||||||||||
Fair value of plan assets at beginning of year | 254.4 | 246.8 | |||||||||||||||||||||||
Actual return on plan assets | 30.9 | 15.7 | |||||||||||||||||||||||
Employer contributions | 1 | 1 | |||||||||||||||||||||||
Benefits paid | (10.2 | ) | (9.1 | ) | |||||||||||||||||||||
Fair value of plan assets at end of year | 276.1 | 254.4 | |||||||||||||||||||||||
Funded status and net amounts recognized | $ | (67.7 | ) | $ | (43.5 | ) | |||||||||||||||||||
Amounts recorded in the Consolidated Balance Sheets: | |||||||||||||||||||||||||
Accrued pension benefits, current portion | $ | (1.0 | ) | $ | (0.2 | ) | |||||||||||||||||||
Accrued pension benefits, long-term | (66.7 | ) | (43.3 | ) | |||||||||||||||||||||
Net amount recognized | $ | (67.7 | ) | $ | (43.5 | ) | |||||||||||||||||||
Schedule of Accumulated Benefit Obligation | ' | ||||||||||||||||||||||||
The accumulated benefit obligation for all defined benefit pension plans was $325.9 million and $278.8 million at September 30, 2014 and 2013. Selected information for our plans, including plans with accumulated benefit obligations exceeding plan assets, was as follows: | |||||||||||||||||||||||||
30-Sep | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
PBO | ABO | Plan Assets | PBO | ABO | Plan Assets | ||||||||||||||||||||
Master plan | $ | 319.1 | $ | 303.2 | $ | 275.8 | $ | 279.2 | $ | 261.7 | $ | 254 | |||||||||||||
International plans | 20.3 | 18.5 | 0.3 | 14.8 | 13.4 | 0.4 | |||||||||||||||||||
Supplemental executive plan | 4.4 | 4.2 | - | 3.9 | 3.7 | - | |||||||||||||||||||
$ | 343.8 | $ | 325.9 | $ | 276.1 | $ | 297.9 | $ | 278.8 | $ | 254.4 | ||||||||||||||
Schedule of Actuarial Assumptions | ' | ||||||||||||||||||||||||
The weighted average assumptions used in accounting for our domestic pension plans were as follows: | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Weighted average assumptions to determine benefit | |||||||||||||||||||||||||
obligations at the measurement date: | |||||||||||||||||||||||||
Discount rate for obligation | 4.5 | % | 5 | % | 4.1 | % | |||||||||||||||||||
Rate of compensation increase | 3 | % | 3.3 | % | 3.3 | % | |||||||||||||||||||
Weighted average assumptions to determine benefit | |||||||||||||||||||||||||
cost for the year: | |||||||||||||||||||||||||
Discount rate for expense | 5 | % | 4.1 | % | 4.6 | % | |||||||||||||||||||
Expected rate of return on plan assets | 7 | % | 7 | % | 7.5 | % | |||||||||||||||||||
Rate of compensation increase | 3.3 | % | 3.3 | % | 3.5 | % | |||||||||||||||||||
Schedule of Allocation of Plan Assets | ' | ||||||||||||||||||||||||
The weighted average asset allocations of our master defined benefit retirement plan at September 30, 2014 and 2013, by asset category, along with target allocations, are as follows: | |||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Target | Target | Actual | Actual | ||||||||||||||||||||||
Allocation | Allocation | Allocation | Allocation | ||||||||||||||||||||||
Equity securities | 40 - 60% | 40 - 60% | 52 | % | 57 | % | |||||||||||||||||||
Fixed income securities | 40 - 60% | 40 - 60% | 48 | % | 43 | % | |||||||||||||||||||
Total | 100 | % | 100 | % | |||||||||||||||||||||
Schedule of Fair Value Measurements of Plan Assets | ' | ||||||||||||||||||||||||
The following table summarizes the valuation of our pension plan assets by pricing categories: | |||||||||||||||||||||||||
Quoted Prices in | Significant | ||||||||||||||||||||||||
Active Markets | Other | Significant | |||||||||||||||||||||||
for Identical | Observable | Unobservable | |||||||||||||||||||||||
Balance at | Assets | Inputs | Inputs | ||||||||||||||||||||||
September 30, 2014 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||||||||
Cash | $ | 2.1 | $ | 2.1 | $ | - | $ | - | |||||||||||||||||
Equities | |||||||||||||||||||||||||
US companies | 101.7 | 101.7 | - | - | |||||||||||||||||||||
International companies | 38.7 | 38.7 | - | - | |||||||||||||||||||||
Fixed income securities | 133.2 | 66.8 | 66.4 | - | |||||||||||||||||||||
Other | 0.4 | 0.4 | - | - | |||||||||||||||||||||
Total plan assets at fair value | $ | 276.1 | $ | 209.7 | $ | 66.4 | $ | - | |||||||||||||||||
Quoted Prices in | Significant | ||||||||||||||||||||||||
Active Markets | Other | Significant | |||||||||||||||||||||||
for Identical | Observable | Unobservable | |||||||||||||||||||||||
Balance at | Assets | Inputs | Inputs | ||||||||||||||||||||||
September 30, 2013 | (Level 1) | (Level 2) | (Level 3) | ||||||||||||||||||||||
Cash | $ | 3 | $ | 3 | $ | - | $ | - | |||||||||||||||||
Equities | |||||||||||||||||||||||||
U.S. companies | 101 | 101 | - | - | |||||||||||||||||||||
International companies | 41.2 | 41.2 | - | - | |||||||||||||||||||||
Fixed income securities | 108.8 | 59.1 | 49.7 | - | |||||||||||||||||||||
Other | 0.4 | 0.4 | - | - | |||||||||||||||||||||
Total plan assets at fair value | $ | 254.4 | $ | 204.7 | $ | 49.7 | $ | - | |||||||||||||||||
Schedule of Estimated Future Benefit Payments | ' | ||||||||||||||||||||||||
The benefit payments, which are expected to be funded through plan assets and company contributions and reflect expected future service, are expected to be paid as follows: | |||||||||||||||||||||||||
Pension Benefits | |||||||||||||||||||||||||
2015 | $ | 12.6 | |||||||||||||||||||||||
2016 | $ | 13.3 | |||||||||||||||||||||||
2017 | $ | 13.8 | |||||||||||||||||||||||
2018 | $ | 14.5 | |||||||||||||||||||||||
2019 | $ | 15.4 | |||||||||||||||||||||||
2020-2024 | $ | 92.2 | |||||||||||||||||||||||
Postretirement Health Care Plan [Member] | ' | ||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ' | ||||||||||||||||||||||||
Schedule of Changes in Obligations, Assets and Funded Status | ' | ||||||||||||||||||||||||
The postretirement health care plan reflected a credit during fiscal 2014, 2013 and 2012 of ($0.2) million, ($0.1) million and ($0.3) million. The change in the accumulated postretirement benefit obligation was as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Change in benefit obligation: | |||||||||||||||||||||||||
Benefit obligation at beginning of year | $ | 9.8 | $ | 9.6 | |||||||||||||||||||||
Service cost | 0.4 | 0.4 | |||||||||||||||||||||||
Interest cost | 0.4 | 0.3 | |||||||||||||||||||||||
Actuarial (gain) loss | (0.2 | ) | (0.2 | ) | |||||||||||||||||||||
Benefits paid | (0.2 | ) | (0.5 | ) | |||||||||||||||||||||
Retiree contributions | 0.2 | 0.2 | |||||||||||||||||||||||
Special termination benefits | 0.8 | - | |||||||||||||||||||||||
Benefit obligation at end of year | $ | 11.2 | $ | 9.8 | |||||||||||||||||||||
Amounts recorded in the Consolidated Balance Sheets: | |||||||||||||||||||||||||
Accrued benefits obligation, current portion | $ | 1.1 | $ | 0.5 | |||||||||||||||||||||
Accrued benefits obligation, long-term | 10.1 | 9.3 | |||||||||||||||||||||||
Net amount recognized | $ | 11.2 | $ | 9.8 | |||||||||||||||||||||
Schedule of Health Care-Cost Trend Rates | ' | ||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Year 1 | 5.75 | % | 6.25 | % | 6.75 | % | |||||||||||||||||||
Year 2 | 5.25 | % | 5.75 | % | 6.25 | % | |||||||||||||||||||
Year 3 | 5 | % | 5.25 | % | 5.75 | % | |||||||||||||||||||
Year 4 | 5 | % | 5 | % | 5.25 | % | |||||||||||||||||||
Year 5 | 5 | % | 5 | % | 5 | % | |||||||||||||||||||
Year 6 | 5 | % | 5 | % | 5 | % | |||||||||||||||||||
Year 7 | 5 | % | 5 | % | 5 | % | |||||||||||||||||||
Year 8 and beyond | 5 | % | 5 | % | 5 | % | |||||||||||||||||||
COMMON_STOCK_Tables
COMMON STOCK (Tables) | 12 Months Ended | |||||||||||||||||
Sep. 30, 2014 | ||||||||||||||||||
COMMON STOCK [Abstract] | ' | |||||||||||||||||
Schedule of Stock-Based Compensation Cost | ' | |||||||||||||||||
The following table sets forth a summary of the annual stock-based compensation cost that was charged against income for all types of awards: | ||||||||||||||||||
Years Ended September 30 | ||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||
Total stock-based compensation cost (pre-tax) | $ | 18 | $ | 13.5 | $ | 11.6 | ||||||||||||
Total income tax benefit | (6.5 | ) | (4.9 | ) | (4.2 | ) | ||||||||||||
Total stock-based compensation cost, net of tax | $ | 11.5 | $ | 8.6 | $ | 7.4 | ||||||||||||
Schedule of Weighted Average Fair Value per Share of Stock Options and Related Valuation Assumptions | ' | |||||||||||||||||
The following table sets forth the weighted average fair value per share of stock options and the related valuation assumptions used in the determination of those fair values: | ||||||||||||||||||
Years Ended September 30 | ||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||
Weighted average fair value per share | $ | 11.91 | $ | 7.91 | $ | 9.79 | ||||||||||||
Valuation assumptions: | ||||||||||||||||||
Risk-free interest rate | 1.3 | % | 0.6 | % | 1 | % | ||||||||||||
Expected dividend yield | 1.4 | % | 1.9 | % | 1.4 | % | ||||||||||||
Expected volatility | 36.1 | % | 40.2 | % | 41.2 | % | ||||||||||||
Weighted average expected life | 4.9 years | 4.9 years | 4.8 years | |||||||||||||||
Schedule of Transactions under Stock Option Plans | ' | |||||||||||||||||
The following table summarizes transactions under our stock option plans for fiscal year 2014: | ||||||||||||||||||
Weighted | Weighted | |||||||||||||||||
Average | Weighted | Average | Aggregate | |||||||||||||||
Number of | Average | Remaining | Intrinsic | |||||||||||||||
Shares | Exercise | Contractual | Value (1) | |||||||||||||||
(in thousands) | Price | Term | (in millions) | |||||||||||||||
Balance Outstanding at October 1, 2013 | 2,163 | $ | 29.89 | |||||||||||||||
Granted | 367 | 41.47 | ||||||||||||||||
Exercised | (376 | ) | 27.85 | |||||||||||||||
Cancelled/Forfeited | (162 | ) | 35.18 | |||||||||||||||
Balance Outstanding at September 30, 2014 | 1,992 | $ | 31.99 | 6.9 years | $ | 18.9 | ||||||||||||
Exercisable at September 30, 2014 | 1,013 | $ | 30.12 | 5.7 years | $ | 11.5 | ||||||||||||
Options Expected to Vest | 897 | $ | 33.8 | 8.0 years | $ | 6.9 | ||||||||||||
-1 | The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $41.43, as reported by the New York Stock Exchange on September 30, 2014. This amount, which changes continuously based on the fair value of our common stock, would have been received by the option holders had all option holders exercised their options as of the balance sheet date. | |||||||||||||||||
Schedule of Transactions for Nonvested RSUs | ' | |||||||||||||||||
The following table summarizes transactions for our nonvested RSUs for fiscal year 2014: | ||||||||||||||||||
Weighted | ||||||||||||||||||
Number of | Average | |||||||||||||||||
Share Units | Grant Date | |||||||||||||||||
(in thousands) | Fair Value | |||||||||||||||||
Nonvested RSUs at October 1, 2013 | 341 | $ | 29.34 | |||||||||||||||
Granted | 263 | 41.01 | ||||||||||||||||
Vested | (98 | ) | 30.39 | |||||||||||||||
Forfeited | (75 | ) | 36.24 | |||||||||||||||
Nonvested RSUs at September 30, 2014 | 431 | $ | 34.92 | |||||||||||||||
Schedule of Weighted Average Fair Value per Share of PSUs and Related Valuation Assumptions | ' | |||||||||||||||||
The following table sets forth the weighted average fair value per share for PSUs and the related valuation assumptions used in the determination of those fair values. PSUs granted in fiscal 2014 are based on company-specific performance targets, with a total shareholder return collar, while grants in fiscal 2013 are based entirely on total shareholder return targets. | ||||||||||||||||||
Years Ended September 30 | ||||||||||||||||||
2014 | 2013 | |||||||||||||||||
Weighted average fair value per share | $ | 47.91 | $ | 19.77 | ||||||||||||||
Valuation assumptions: | ||||||||||||||||||
Risk-free interest rate | 0.5 | % | 0.3 | % | ||||||||||||||
Expected dividend yield | 0 | % | 0 | % | ||||||||||||||
Expected volatility | 30.1 | % | 32.6 | % | ||||||||||||||
Schedule of Transactions for Nonvested PSUs | ' | |||||||||||||||||
The following table summarizes transactions for our nonvested PSUs for fiscal 2014: | ||||||||||||||||||
Weighted | ||||||||||||||||||
Number of | Average | |||||||||||||||||
Share Units | Grant Date | |||||||||||||||||
(in thousands) | Fair Value | |||||||||||||||||
Nonvested PSUs as of October 1, 2013 | 574 | $ | 23.84 | |||||||||||||||
Granted | 205 | 47.91 | ||||||||||||||||
Vested | - | - | ||||||||||||||||
Cancelled | (122 | ) | 31.13 | |||||||||||||||
Forfeited | (71 | ) | 30.08 | |||||||||||||||
Nonvested PSUs at September 30, 2014 | 586 | $ | 29.98 |
SPECIAL_CHARGES_Tables
SPECIAL CHARGES (Tables) | 12 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Special Charges [Abstract] | ' | ||||||||||||||||||||
Restructuring Activity | ' | ||||||||||||||||||||
Severance activity related to these actions during fiscal 2014 was as follows: | |||||||||||||||||||||
Beginning | Ending | ||||||||||||||||||||
Balance | Balance | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | Expenses | Cash Payments | Reversals | 2014 | |||||||||||||||||
Fiscal 2014 Actions | $ | - | $ | 20.8 | $ | (8.6 | ) | $ | (0.7 | ) | $ | 11.5 | |||||||||
Prior Restructuring Actions | 2.9 | - | (2.6 | ) | (0.1 | ) | 0.2 | ||||||||||||||
Total | $ | 2.9 | $ | 20.8 | $ | (11.2 | ) | $ | (0.8 | ) | $ | 11.7 |
INCOME_TAXES_Tables
INCOME TAXES (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||
INCOME TAXES [Abstract] | ' | ||||||||||||||||||||||||
Schedule of Components of Income before Income Taxes | ' | ||||||||||||||||||||||||
The significant components of income before income taxes and the consolidated income tax provision were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Income before income taxes: | |||||||||||||||||||||||||
Domestic | $ | 87 | $ | 120 | $ | 148.6 | |||||||||||||||||||
Foreign | 28.2 | 24 | 14.9 | ||||||||||||||||||||||
Total | $ | 115.2 | $ | 144 | $ | 163.5 | |||||||||||||||||||
Schedule of Income Tax Expense | ' | ||||||||||||||||||||||||
Income tax expense: | |||||||||||||||||||||||||
Current provision | |||||||||||||||||||||||||
Federal | $ | 40.2 | $ | 45 | $ | 65.9 | |||||||||||||||||||
State | 3.1 | 1.8 | 4.3 | ||||||||||||||||||||||
Foreign | 7.4 | 7 | 4.8 | ||||||||||||||||||||||
Total current provision | 50.7 | 53.8 | 75 | ||||||||||||||||||||||
Deferred provision: | |||||||||||||||||||||||||
Federal | (12.2 | ) | (9.9 | ) | (29.2 | ) | |||||||||||||||||||
State | (1.0 | ) | 1.1 | 0.1 | |||||||||||||||||||||
Foreign | 17.1 | (6.0 | ) | (3.2 | ) | ||||||||||||||||||||
Total deferred provision | 3.9 | (14.8 | ) | (32.3 | ) | ||||||||||||||||||||
Income tax expense | $ | 54.6 | $ | 39 | $ | 42.7 | |||||||||||||||||||
Reconciliation of Income Tax Expense to Income Taxes at Statutory Rate | ' | ||||||||||||||||||||||||
Differences between income tax expense reported for financial reporting purposes and that computed based upon the application of the statutory U.S. Federal tax rate to the reported income before income taxes were as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
% of | % of | % of | |||||||||||||||||||||||
Pretax | Pretax | Pretax | |||||||||||||||||||||||
Amount | Income | Amount | Income | Amount | Income | ||||||||||||||||||||
Federal income tax (a) | $ | 40.3 | 35 | $ | 50.4 | 35 | $ | 57.2 | 35 | ||||||||||||||||
State income tax (b) | 2 | 1.7 | 2.5 | 1.7 | 3.5 | 2.2 | |||||||||||||||||||
Foreign income tax (c) | (7.7 | ) | (6.7 | ) | (5.7 | ) | (4.0 | ) | (3.4 | ) | (2.1 | ) | |||||||||||||
International tax restructuring | - | - | (0.8 | ) | (0.6 | ) | (11.0 | ) | (6.7 | ) | |||||||||||||||
Application of federal tax credits | (0.6 | ) | (0.5 | ) | (3.5 | ) | (2.4 | ) | (0.6 | ) | (0.4 | ) | |||||||||||||
Adjustment of estimated income tax accruals | (0.6 | ) | (0.5 | ) | (1.5 | ) | (1.0 | ) | (2.1 | ) | (1.3 | ) | |||||||||||||
Valuation of tax attributes | 21.3 | 18.5 | 0.6 | 0.4 | 0.3 | 0.2 | |||||||||||||||||||
Other, net | (0.1 | ) | (0.1 | ) | (3.0 | ) | (2.0 | ) | (1.2 | ) | (0.8 | ) | |||||||||||||
Income tax expense | $ | 54.6 | 47.4 | $ | 39 | 27.1 | $ | 42.7 | 26.1 | ||||||||||||||||
(a) | At statutory rate. | ||||||||||||||||||||||||
(b) | Net of Federal benefit. | ||||||||||||||||||||||||
(c) | Federal tax rate differential. | ||||||||||||||||||||||||
. | |||||||||||||||||||||||||
Schedule of Deferred Taxes | ' | ||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
Deferred tax assets: | |||||||||||||||||||||||||
Employee benefit accruals | $ | 49.3 | $ | 46.6 | |||||||||||||||||||||
Inventory | 13.9 | 7.4 | |||||||||||||||||||||||
Reserve for bad debts | 10 | 10.1 | |||||||||||||||||||||||
Accrued warranty | 7.3 | 9.7 | |||||||||||||||||||||||
Net operating loss carryforwards | 40.3 | 38.3 | |||||||||||||||||||||||
Tax credit carryforwards | 2.5 | 2 | |||||||||||||||||||||||
Other, net | 18.4 | 16.3 | |||||||||||||||||||||||
141.7 | 130.4 | ||||||||||||||||||||||||
Less: Valuation allowance | (28.3 | ) | (8.9 | ) | |||||||||||||||||||||
Total deferred tax assets | 113.4 | 121.5 | |||||||||||||||||||||||
Deferred tax liabilities: | |||||||||||||||||||||||||
Depreciation | (13.9 | ) | (32.1 | ) | |||||||||||||||||||||
Amortization | (62.8 | ) | (67.5 | ) | |||||||||||||||||||||
Other, net | (4.9 | ) | (3.2 | ) | |||||||||||||||||||||
Total deferred tax liabilities | (81.6 | ) | (102.8 | ) | |||||||||||||||||||||
Deferred tax asset - net | $ | 31.8 | $ | 18.7 | |||||||||||||||||||||
Reconciliation of the Beginning and Ending Amount of Unrecognized Tax Benefits | ' | ||||||||||||||||||||||||
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | |||||||||||||||||||||||||
Years Ended September 30 | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Balance at October 1 | $ | 4.6 | $ | 9.8 | $ | 17.8 | |||||||||||||||||||
Increases in tax position of prior years | 2.1 | - | 0.5 | ||||||||||||||||||||||
Decreases in tax position of prior years | (0.9 | ) | (0.5 | ) | (2.7 | ) | |||||||||||||||||||
Increases in tax positions related to the current year | - | 0.1 | - | ||||||||||||||||||||||
Settlements with taxing authorities | (0.1 | ) | (3.2 | ) | (3.8 | ) | |||||||||||||||||||
Lapse of applicable statute of limitations | (1.5 | ) | (1.7 | ) | (1.9 | ) | |||||||||||||||||||
Foreign currency adjustments | (0.1 | ) | 0.1 | (0.1 | ) | ||||||||||||||||||||
Total change | (0.5 | ) | (5.2 | ) | (8.0 | ) | |||||||||||||||||||
Balance at September 30 | $ | 4.1 | $ | 4.6 | $ | 9.8 |
EARNINGS_PER_COMMON_SHARE_Tabl
EARNINGS PER COMMON SHARE (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
EARNINGS PER COMMON SHARE [Abstract] | ' | ||||||||||||
Calculated Earnings per Share | ' | ||||||||||||
Earnings per share is calculated as follows: | |||||||||||||
Years Ended September 30 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net income attributable to common shareholders | $ | 60.6 | $ | 105 | $ | 120.8 | |||||||
Average shares outstanding - Basic (thousands) | 57,555 | 59,910 | 62,120 | ||||||||||
Add potential effect of exercise of stock options | |||||||||||||
and other unvested equity awards (thousands) | 968 | 340 | 241 | ||||||||||
Average shares outstanding - Diluted (thousands) | 58,523 | 60,250 | 62,361 | ||||||||||
Net income per common share - Basic | $ | 1.05 | $ | 1.75 | $ | 1.94 | |||||||
Net income per common share - Diluted | $ | 1.04 | $ | 1.74 | $ | 1.94 | |||||||
SEGMENT_REPORTING_Tables
SEGMENT REPORTING (Tables) | 12 Months Ended | ||||||||||||
Sep. 30, 2014 | |||||||||||||
SEGMENT REPORTING [Abstract] | ' | ||||||||||||
Reconciliation of Segment Information to Consolidated Financial Information | ' | ||||||||||||
Years Ended September 30 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Revenue: | |||||||||||||
North America | $ | 888.9 | $ | 958.3 | $ | 998.2 | |||||||
Surgical and Respiratory Care | 301.6 | 245.8 | 153.2 | ||||||||||
International | 495.6 | 512.1 | 482.9 | ||||||||||
Total revenue | $ | 1,686.10 | $ | 1,716.20 | $ | 1,634.30 | |||||||
Divisional income: | |||||||||||||
North America | $ | 165 | $ | 201.7 | $ | 215.4 | |||||||
Surgical and Respiratory Care | 68.6 | 56.8 | 43.9 | ||||||||||
International | 24.9 | 33.5 | 31.4 | ||||||||||
Other operating costs: | |||||||||||||
Non-allocated operating and administrative costs | 98.8 | 131.4 | 99.3 | ||||||||||
Impairment of other intangibles | - | - | 8 | ||||||||||
Litigation credit | - | - | (3.6 | ) | |||||||||
Special charges | 37.1 | 5.7 | 18.2 | ||||||||||
Operating profit | 122.6 | 154.9 | 168.8 | ||||||||||
Interest expense | (9.8 | ) | (9.5 | ) | (6.5 | ) | |||||||
Investment income and other, net | 2.4 | (1.4 | ) | 1.2 | |||||||||
Income before income taxes | $ | 115.2 | $ | 144 | $ | 163.5 | |||||||
Schedule of Geographic Information | ' | ||||||||||||
Geographic data for net revenue and long-lived assets (which consist mainly of property and equipment leased to others) were as follows: | |||||||||||||
Years Ended September 30 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Net revenue to unaffiliated customers: (a) | |||||||||||||
United States | $ | 1,070.80 | $ | 1,116.40 | $ | 1,077.80 | |||||||
Foreign | 615.3 | 599.8 | 556.5 | ||||||||||
Total revenue | $ | 1,686.10 | $ | 1,716.20 | $ | 1,634.30 | |||||||
Long-lived assets: (b) | |||||||||||||
United States | $ | 151.7 | $ | 158 | $ | 172.5 | |||||||
Foreign | 109.8 | 76.3 | 77.6 | ||||||||||
Total long-lived assets | $ | 261.5 | $ | 234.3 | $ | 250.1 | |||||||
(a) | |||||||||||||
Net revenue is attributed to geographic areas based on the location of the customer. | |||||||||||||
(b) | |||||||||||||
Includes property and equipment leased to others. | |||||||||||||
QUARTERLY_FINANCIAL_INFORMATIO1
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables) | 12 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) [Abstract] | ' | ||||||||||||||||
Schedule of Selected Consolidated Financial Data | ' | ||||||||||||||||
The following table presents selected consolidated financial data by quarter for each of the last two fiscal years. | |||||||||||||||||
2014 Quarter Ended | December 31, | March 31, | June 30, | September 30, | |||||||||||||
2013 | 2014 | 2014 | 2014 | ||||||||||||||
Net revenue | $ | 393.4 | $ | 415.3 | $ | 397.6 | $ | 479.8 | |||||||||
Gross profit | $ | 176.8 | $ | 202.7 | $ | 187.1 | $ | 213.3 | |||||||||
Net income (loss) | $ | 13.2 | $ | (3.3 | ) | $ | 26.1 | $ | 24.6 | ||||||||
Basic net income (loss) per common share | $ | 0.23 | $ | (0.06 | ) | $ | 0.46 | $ | 0.43 | ||||||||
Diluted net income (loss) per common share | $ | 0.22 | $ | (0.06 | ) | $ | 0.45 | $ | 0.42 | ||||||||
2013 Quarter Ended | December 31, | March 31, | June 30, | September 30, 2013 | |||||||||||||
2012 | 2013 | 2013 | |||||||||||||||
Net revenue | $ | 428.4 | $ | 425.7 | $ | 424.2 | $ | 437.9 | |||||||||
Gross profit | $ | 191.4 | $ | 196.1 | $ | 190.1 | $ | 202.7 | |||||||||
Net income | $ | 24 | $ | 22.3 | $ | 23.4 | $ | 35.3 | |||||||||
Basic net income per common share | $ | 0.39 | $ | 0.37 | $ | 0.39 | $ | 0.6 | |||||||||
Diluted net income per common share | $ | 0.39 | $ | 0.37 | $ | 0.39 | $ | 0.59 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended | ||||
Sep. 30, 2014 | |||||
COMMITMENTS AND CONTINGENCIES [Abstract] | ' | ||||
Schedule of Future Minimum Rental Payments | ' | ||||
Rental expense for fiscal years 2014, 2013 and 2012 was $24.7 million, $21.5 million and $20.7 million. The table below indicates the minimum annual rental commitments (excluding renewable periods) aggregating $62.9 million, for manufacturing facilities, warehouse distribution centers, service centers and sales offices, under non-cancelable operating leases. | |||||
Amount | |||||
2015 | $ | 22.5 | |||
2016 | $ | 16.6 | |||
2017 | $ | 12.5 | |||
2018 | $ | 6.9 | |||
2019 | $ | 1.7 | |||
2020 and beyond | $ | 2.7 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Nature of Operations) (Details) | Sep. 30, 2014 |
countries | |
employees | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ' |
Number of employees | 7,000 |
Number of countries | 100 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Inventories) (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Millions, unless otherwise specified | ||
Inventories | ' | ' |
Percentage of LIFO inventory | 36.00% | 47.00% |
Inventories consist of the following: | ' | ' |
Finished products | $93.50 | $66.30 |
Work in process | 17.3 | 5.8 |
Raw materials | 65.4 | 46.2 |
Total | 176.2 | 118.3 |
Excess of current costs over reported LIFO value | $4 | $3.20 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Property, Plant and Equipment) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Property, Plant and Equipment | ' | ' | ' |
Depreciation expense | $65.40 | $71.20 | $73.90 |
Major components of property and the related accumulated depreciation: | ' | ' | ' |
Cost | 849.6 | 821.7 | ' |
Less accumulated depreciation | 588.1 | 587.4 | ' |
Land Improvements [Member] | Minimum [Member] | ' | ' | ' |
Property, Plant and Equipment | ' | ' | ' |
Estimated useful life | '6 years | ' | ' |
Land Improvements [Member] | Maximum [Member] | ' | ' | ' |
Property, Plant and Equipment | ' | ' | ' |
Estimated useful life | '15 years | ' | ' |
Land and Land Improvements [Member] | ' | ' | ' |
Major components of property and the related accumulated depreciation: | ' | ' | ' |
Cost | 19.4 | 14 | ' |
Less accumulated depreciation | 2.3 | 2.1 | ' |
Buildings and Building Equipment [Member] | ' | ' | ' |
Major components of property and the related accumulated depreciation: | ' | ' | ' |
Cost | 158.3 | 143.1 | ' |
Less accumulated depreciation | 88.6 | 84.6 | ' |
Buildings and Building Equipment [Member] | Minimum [Member] | ' | ' | ' |
Property, Plant and Equipment | ' | ' | ' |
Estimated useful life | '10 years | ' | ' |
Buildings and Building Equipment [Member] | Maximum [Member] | ' | ' | ' |
Property, Plant and Equipment | ' | ' | ' |
Estimated useful life | '40 years | ' | ' |
Machinery and Equipment [Member] | ' | ' | ' |
Major components of property and the related accumulated depreciation: | ' | ' | ' |
Cost | 321.3 | 288 | ' |
Less accumulated depreciation | 213.7 | 198.8 | ' |
Machinery and Equipment [Member] | Minimum [Member] | ' | ' | ' |
Property, Plant and Equipment | ' | ' | ' |
Estimated useful life | '3 years | ' | ' |
Machinery and Equipment [Member] | Maximum [Member] | ' | ' | ' |
Property, Plant and Equipment | ' | ' | ' |
Estimated useful life | '10 years | ' | ' |
Equipment Leased to Others [Member] | ' | ' | ' |
Major components of property and the related accumulated depreciation: | ' | ' | ' |
Cost | 350.6 | 376.6 | ' |
Less accumulated depreciation | $283.50 | $301.90 | ' |
Equipment Leased to Others [Member] | Minimum [Member] | ' | ' | ' |
Property, Plant and Equipment | ' | ' | ' |
Estimated useful life | '2 years | ' | ' |
Equipment Leased to Others [Member] | Maximum [Member] | ' | ' | ' |
Property, Plant and Equipment | ' | ' | ' |
Estimated useful life | '10 years | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Intangible Assets) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Goodwill: | ' | ' | ' |
Cost | $872.60 | $815.60 | $808 |
Amortization and Impairment | 472.8 | 472.8 | 472.8 |
Other intangible assets: | ' | ' | ' |
Amortization expense | 41 | 45.6 | 37.8 |
Total | ' | ' | ' |
Cost | 1,417 | 1,316.60 | ' |
Amortization and Impairment | 756.1 | 721.1 | ' |
Expected future amortization: | ' | ' | ' |
2015 | 40.9 | ' | ' |
2016 | 38.3 | ' | ' |
2017 | 28.5 | ' | ' |
2018 | 23.8 | ' | ' |
2019 | 18.8 | ' | ' |
2020 and beyond | 77.9 | ' | ' |
Capitalized computer software: | ' | ' | ' |
Net book value of computer software costs | 23.9 | 28.7 | ' |
Amortization expense of capitalized software costs | 11.5 | 17.8 | 20.7 |
Minimum [Member] | ' | ' | ' |
Other intangible assets: | ' | ' | ' |
Useful life | '3 years | ' | ' |
Maximum [Member] | ' | ' | ' |
Other intangible assets: | ' | ' | ' |
Useful life | '20 years | ' | ' |
Software [Member] | ' | ' | ' |
Other intangible assets: | ' | ' | ' |
Cost | 170.5 | 164.6 | ' |
Amortization and Impairment | 146.6 | 135.9 | ' |
Others [Member] | ' | ' | ' |
Other intangible assets: | ' | ' | ' |
Cost | 373.9 | 336.4 | ' |
Amortization and Impairment | $136.70 | $112.40 | ' |
Capitalized Software Costs [Member] | Minimum [Member] | ' | ' | ' |
Other intangible assets: | ' | ' | ' |
Useful life | '3 years | ' | ' |
Capitalized Software Costs [Member] | Maximum [Member] | ' | ' | ' |
Other intangible assets: | ' | ' | ' |
Useful life | '10 years | ' | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Guarantees) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES [Abstract] | ' | ' | ' |
Charge related to field corrective action | ' | $12.20 | $16 |
Warranty provision, net reversals | 1.7 | ' | ' |
Guarantees | ' | ' | ' |
Balance at October 1 | 38.1 | 42.2 | 17.8 |
Provision for warranties during the period | 9.8 | 29.2 | 31.8 |
Warranty reserves acquired | 3 | -2.6 | 9.7 |
Warranty claims incurred during the period | -22.5 | -30.7 | -17.1 |
Balance at September 30 | $28.40 | $38.10 | $42.20 |
SUMMARY_OF_SIGNIFICANT_ACCOUNT8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Employee Benefits Change and Self Insurance) (Details) (USD $) | 3 Months Ended | ||
Jun. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2014 | |
Paid Time Off Policy [Member] | Paid Time Off Policy [Member] | Uninsured Risk [Member] | |
Loss Contingencies [Line Items] | ' | ' | ' |
Deductibles and self-insured retentions, minimum | ' | ' | $25,000 |
Deductibles and self-insured retentions, maximum | ' | ' | 1,000,000 |
Change in Accounting Estimate [Line Items] | ' | ' | ' |
Employee benefits expense reversed | ($1,200,000) | ($12,200,000) | ' |
SUMMARY_OF_SIGNIFICANT_ACCOUNT9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Research and Development and Advertising Costs) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Research and Development Costs | ' | ' | ' |
Research and development expenses | $71.90 | $70.20 | $66.90 |
Software development technology costs capitalized during the period | 2.6 | 2.4 | 2.3 |
Advertising Costs | ' | ' | ' |
Advertising costs | $7.30 | $7.40 | $4.40 |
ACQUISITIONS_Acquisition_of_Tr
ACQUISITIONS (Acquisition of Trumpf Medical) (Details) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | ||||||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Aug. 01, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Aug. 01, 2014 | Sep. 30, 2014 | Aug. 01, 2014 | Sep. 30, 2014 | Aug. 01, 2014 | Aug. 01, 2014 |
Trumpf Medical [Member] | Trumpf Medical [Member] | Trumpf Medical [Member] | Trumpf Medical [Member] | Trumpf Medical [Member] | Trumpf Medical [Member] | Trumpf Medical [Member] | Trumpf Medical [Member] | Trumpf Medical [Member] | Trumpf Medical [Member] | ||||
Trade Name [Member] | Trade Name [Member] | Customer Relationships [Member] | Customer Relationships [Member] | Technology [Member] | Technology [Member] | Other Intangible Assets [Member] | |||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price of entity | ' | ' | ' | $229.90 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price of entity, net of cash acquired | 239.5 | ' | 476.8 | 223.6 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues included in statements of operations | ' | ' | ' | ' | 39 | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of the assets acquired and liabilities assumed: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Trade receivables | ' | ' | ' | 66.3 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Inventory | ' | ' | ' | 64.4 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other current assets | ' | ' | ' | 24 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Property, plant, and equipment | ' | ' | ' | 42.1 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 399.8 | 342.8 | 335.2 | 57.3 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets (Finite Lived) | ' | ' | ' | ' | ' | ' | ' | 6.7 | ' | 15.8 | ' | 17.8 | 4.8 |
Other noncurrent assets | ' | ' | ' | 0.7 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred tax asset | ' | ' | ' | 14.2 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current liabilities | ' | ' | ' | -70.1 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Long term debt | ' | ' | ' | -6 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Noncurrent liabilities | ' | ' | ' | -8.1 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total purchase price | ' | ' | ' | 229.9 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Useful lives assigned to intangibles: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average useful life | ' | ' | ' | ' | ' | ' | '5 years | ' | '10 years | ' | '8 years | ' | ' |
Pro Forma Information: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total revenues | ' | ' | ' | ' | $218 | $235 | ' | ' | ' | ' | ' | ' | ' |
ACQUISITIONS_Acquisition_of_Vi
ACQUISITIONS (Acquisition of Virtus) (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Mar. 31, 2014 | Jun. 30, 2014 |
Virtus, Inc. [Member] | Virtus, Inc. [Member] | ||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' |
Purchase price of entity | ' | ' | ' | $17.60 | ' |
Purchase price of entity, net of cash acquired | 239.5 | ' | 476.8 | 13 | ' |
Fair value of the assets acquired and liabilities assumed: | ' | ' | ' | ' | ' |
Inventory | ' | ' | ' | 2.6 | ' |
Other current assets | ' | ' | ' | 5.4 | ' |
Property, plant, and equipment | ' | ' | ' | 1.9 | ' |
Goodwill | 399.8 | 342.8 | 335.2 | 9.4 | 9.4 |
Current liabilities | ' | ' | ' | -1.6 | ' |
Deferred tax liability | ' | ' | ' | -0.1 | ' |
Total purchase price | ' | ' | ' | $17.60 | ' |
ACQUISITIONS_Acquisition_of_As
ACQUISITIONS (Acquisition of Aspen) (Details) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | ||||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Jul. 23, 2012 | Sep. 30, 2013 | Sep. 30, 2014 | Jul. 23, 2012 | Sep. 30, 2014 | Jul. 23, 2012 | Sep. 30, 2014 | Jul. 23, 2012 |
Aspen [Member] | Aspen [Member] | Aspen [Member] | Aspen [Member] | Aspen [Member] | Aspen [Member] | Aspen [Member] | Aspen [Member] | ||||
Trade Name [Member] | Trade Name [Member] | Customer Relationships [Member] | Customer Relationships [Member] | Technology [Member] | Technology [Member] | ||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price of entity | ' | ' | ' | $402.20 | ' | ' | ' | ' | ' | ' | ' |
Purchase price of entity, net of cash acquired | 239.5 | ' | 476.8 | 399.8 | ' | ' | ' | ' | ' | ' | ' |
Purchase price adjustment | ' | ' | ' | ' | -1 | ' | ' | ' | ' | ' | ' |
Adjusted purchase price | ' | ' | ' | ' | 401.2 | ' | ' | ' | ' | ' | ' |
Fair value of the assets acquired and liabilities assumed: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Inventory | ' | ' | ' | 25.6 | ' | ' | ' | ' | ' | ' | ' |
Other current assets | ' | ' | ' | 19.7 | ' | ' | ' | ' | ' | ' | ' |
Property, plant, and equipment | ' | ' | ' | 24.6 | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 399.8 | 342.8 | 335.2 | 220.1 | ' | ' | ' | ' | ' | ' | ' |
Trade name (Indefinite Lived) | ' | ' | ' | 29 | ' | ' | ' | ' | ' | ' | ' |
Intangible assets (Finite Lived) | ' | ' | ' | ' | ' | ' | 4.6 | ' | 121.9 | ' | 9.1 |
Other noncurrent assets | ' | ' | ' | 1.6 | ' | ' | ' | ' | ' | ' | ' |
Current liabilities | ' | ' | ' | -14 | ' | ' | ' | ' | ' | ' | ' |
Deferred tax liability | ' | ' | ' | -41 | ' | ' | ' | ' | ' | ' | ' |
Total purchase price | ' | ' | ' | $401.20 | ' | ' | ' | ' | ' | ' | ' |
Useful lives assigned to intangibles: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average useful life | ' | ' | ' | ' | ' | '15 years | ' | '13 years | ' | '10 years | ' |
ACQUISITIONS_Acquisition_of_Vo
ACQUISITIONS (Acquisition of Volker) (Details) (USD $) | 12 Months Ended | 0 Months Ended | 3 Months Ended | 32 Months Ended | 12 Months Ended | 12 Months Ended | |||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Feb. 13, 2012 | Dec. 31, 2013 | Sep. 30, 2012 | Sep. 30, 2014 | Sep. 30, 2014 | Feb. 13, 2012 | Sep. 30, 2014 | Feb. 13, 2012 |
Volker [Member] | Volker [Member] | Volker [Member] | Volker [Member] | Volker [Member] | Volker [Member] | Volker [Member] | Volker [Member] | ||||
Trade Name [Member] | Trade Name [Member] | Customer Relationships [Member] | Customer Relationships [Member] | ||||||||
Business Acquisition [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase price of entity | ' | ' | ' | $80.70 | ' | ' | $73.20 | ' | ' | ' | ' |
Purchase price of entity, net of cash acquired | 239.5 | ' | 476.8 | 77 | ' | ' | ' | ' | ' | ' | ' |
Purchase price adjustment | ' | ' | ' | ' | -3.5 | -4 | ' | ' | ' | ' | ' |
Fair value of the assets acquired and liabilities assumed: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill | 399.8 | 342.8 | 335.2 | 28.3 | ' | ' | ' | ' | ' | ' | ' |
Intangible assets (Finite Lived) | ' | ' | ' | ' | ' | ' | ' | ' | 12.3 | ' | 17.5 |
Net assets acquired | ' | ' | ' | 24.6 | ' | ' | ' | ' | ' | ' | ' |
Deferred tax liability | ' | ' | ' | -9.5 | ' | ' | ' | ' | ' | ' | ' |
Total purchase price | ' | ' | ' | $73.20 | ' | ' | ' | ' | ' | ' | ' |
Useful lives assigned to intangibles: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted-average useful life | ' | ' | ' | ' | ' | ' | ' | '7 years | ' | '8 years | ' |
GOODWILL_AND_INDEFINITELIVED_I2
GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS (Schedule of Goodwill Activity) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Goodwill [Line Items] | ' | ' | ' | ' |
Goodwill | ' | $872.60 | $815.60 | $808 |
Accumulated impairment losses | ' | -472.8 | -472.8 | -472.8 |
Goodwill, net | ' | 399.8 | 342.8 | 335.2 |
Goodwill related to acquisitions | -3.5 | 62.1 | 2.9 | ' |
Currency translation effect | ' | -5.1 | 4.7 | ' |
North America Segment [Member] | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' |
Goodwill | ' | 390.6 | 383 | 383 |
Accumulated impairment losses | ' | -358.1 | -358.1 | -358.1 |
Goodwill, net | ' | 32.5 | 24.9 | 24.9 |
Goodwill related to acquisitions | ' | 7.6 | ' | ' |
Currency translation effect | ' | ' | ' | ' |
Surgical and Respiratory Care Segment [Member] | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' |
Goodwill | ' | 333.5 | 279 | 271.5 |
Accumulated impairment losses | ' | ' | ' | ' |
Goodwill, net | ' | 333.5 | 279 | 271.5 |
Goodwill related to acquisitions | ' | 57.3 | 4.8 | ' |
Currency translation effect | ' | -2.8 | 2.7 | ' |
International [Member] | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' |
Goodwill | ' | 148.5 | 153.6 | 153.5 |
Accumulated impairment losses | ' | -114.7 | -114.7 | -114.7 |
Goodwill, net | ' | 33.8 | 38.9 | 38.8 |
Goodwill related to acquisitions | ' | -2.8 | -1.9 | ' |
Currency translation effect | ' | ($2.30) | $2 | ' |
GOODWILL_AND_INDEFINITELIVED_I3
GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS (Narrative) (Details) (USD $) | 3 Months Ended | 12 Months Ended | 0 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Mar. 31, 2014 | Jun. 30, 2014 |
units | Virtus, Inc. [Member] | Virtus, Inc. [Member] | ||||
Goodwill [Line Items] | ' | ' | ' | ' | ' | ' |
Goodwill | ' | $399.80 | $342.80 | $335.20 | $9.40 | $9.40 |
Number of reportable business segments | ' | 3 | ' | ' | ' | ' |
Number of reporting units | ' | 10 | ' | ' | ' | ' |
Minimum threshold at which impairment charge may be recognized | ' | 10.00% | ' | ' | ' | ' |
Goodwill related to acquisitions | -3.5 | 62.1 | 2.9 | ' | 9.6 | ' |
Indefinite-lived intangible assets | ' | $32.90 | $32.90 | ' | ' | ' |
FINANCING_AGREEMENTS_Schedule_
FINANCING AGREEMENTS (Schedule of Total Debt) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Long-term Debt, by Current and Noncurrent [Abstract] | ' | ' |
Total debt | $491.80 | $307 |
Less current portion of debt | 126.9 | 81.2 |
Total long-term debt | 364.9 | 225.8 |
Revolving Credit Facility [Member] | ' | ' |
Long-term Debt, by Current and Noncurrent [Abstract] | ' | ' |
Total debt | 265 | 70 |
Term Loan [Member] | ' | ' |
Long-term Debt, by Current and Noncurrent [Abstract] | ' | ' |
Total debt | 176.2 | ' |
Less current portion of debt | 16.2 | 11.2 |
Total long-term debt | 160 | 176.2 |
Unsecured 7.00% Debentures due on February 15, 2024 [Member] | ' | ' |
Long-term Debt, by Current and Noncurrent [Abstract] | ' | ' |
Total debt | 19.4 | 19.6 |
Unsecured debenture interest rate | 7.00% | ' |
Debt instrument, maturity date | 15-Feb-24 | ' |
Unsecured 6.75% Debentures due on December 15, 2027 [Member] | ' | ' |
Long-term Debt, by Current and Noncurrent [Abstract] | ' | ' |
Total debt | 29.8 | 29.8 |
Unsecured debenture interest rate | 6.75% | ' |
Debt instrument, maturity date | 15-Dec-27 | ' |
Other [Member] | ' | ' |
Long-term Debt, by Current and Noncurrent [Abstract] | ' | ' |
Total debt | $1.40 | $0.20 |
FINANCING_AGREEMENTS_Schedule_1
FINANCING AGREEMENTS (Schedule of Maturities of Long-Term Debt) (Details) (USD $) | Sep. 30, 2014 |
In Millions, unless otherwise specified | |
FINANCING AGREEMENTS [Abstract] | ' |
2015 | $16.20 |
2016 | 20 |
2017 | 140 |
2018 | ' |
2019 | ' |
FINANCING_AGREEMENTS_Narrative
FINANCING AGREEMENTS (Narrative) (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 |
In Millions, unless otherwise specified | Interest Rate Swap [Member] | Interest Rate Swap [Member] | Guarantee of Trumpf Outstanding Debt [Member] | New Credit Facility [Member] | Term Loan [Member] | Potential Increase to Credit Facility [Member] | Maximum [Member] | Minimum [Member] | ||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding letters of credit | $42.40 | ' | ' | ' | $39.80 | $5.30 | ' | ' | ' | ' |
Deferred gains from the termination of previous interest rate swap agreements | 1 | 1 | ' | ' | ' | ' | ' | ' | ' | ' |
Senior revolving credit facility, maximum borrowing amount | ' | ' | ' | ' | ' | 500 | ' | 250 | ' | ' |
Aggregate value of debt | ' | ' | ' | ' | ' | ' | 200 | ' | ' | ' |
Credit facility expiration date | ' | ' | ' | ' | ' | 24-Aug-17 | ' | ' | ' | ' |
Percent of principal to be repaid over term | ' | ' | ' | ' | ' | 37.50% | ' | ' | ' | ' |
Number of years under revolving credit facility | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' |
Maximum interest rate during period | ' | ' | ' | ' | ' | 2.00% | ' | ' | ' | ' |
Ratio of consolidated indebtedness to consolidated EBITDA | ' | ' | ' | ' | ' | ' | ' | ' | 3.5 | ' |
Interest coverage ratio | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.5 |
Outstanding borrowings | ' | ' | ' | ' | ' | 265 | ' | ' | ' | ' |
Current borrowing capacity under the facility | ' | ' | ' | ' | ' | 229.7 | ' | ' | ' | ' |
Fair value of unsecured debentures | 55.5 | 52.5 | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of term loan | 175.2 | 185.5 | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate swap agreement, notional amount | ' | ' | 126.3 | ' | ' | ' | ' | ' | ' | ' |
Interest rate swap, fair value | ' | ' | $0.20 | $0.20 | ' | ' | ' | ' | ' | ' |
OTHER_COMPREHENSIVE_INCOME_Sch
OTHER COMPREHENSIVE INCOME (Schedule of Changes in AOCL by Component) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | |
Beginning balance | ($35.70) | |
Ending balance | -74.1 | |
Tax effect of available-for-sale securities and cash flow hedges, before reclassification | -0.1 | |
Tax effect of foreign currency translation adjustment, before reclassification | 0 | |
Tax effect of items not yet recognized as a component of net periodic pension and postretirement healthcare costs, before reclassification | 6 | |
Available-For-Sale Securities and Cash Flow Hedges [Member] | ' | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | |
Beginning balance | -0.3 | [1] |
OCI before reclassifications | 0.2 | [1],[2] |
Amounts reclassified out of AOCL | 0.1 | [1] |
Net current period OCI | 0.3 | [1] |
Ending balance | ' | [1] |
Foreign Currency Translation Adjustment [Member] | ' | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | |
Beginning balance | -4.6 | [1] |
OCI before reclassifications | -29.6 | [1],[2] |
Amounts reclassified out of AOCL | ' | [1] |
Net current period OCI | -29.6 | [1] |
Ending balance | -34.2 | [1] |
Pension and Postretirement Defined Benefit Plan Items [Member] | ' | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | |
Beginning balance | -30.8 | [1] |
OCI before reclassifications | -10.8 | [1],[2] |
Amounts reclassified out of AOCL | 1.7 | [1] |
Net current period OCI | -9.1 | [1] |
Ending balance | ($39.90) | [1] |
[1] | All amounts are net of tax. | |
[2] | Net of tax of $(0.1), $0.0, and $6.0 for available-for-sale securities and cash flow hedges, foreign currency translation adjustment, and changes in pension and postretirement defined benefit plans, respectively. |
OTHER_COMPREHENSIVE_INCOME_Sch1
OTHER COMPREHENSIVE INCOME (Schedule of Items Reclassified out of AOCL) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Amount before tax | ' | ' | ' | ' | ' | ' | ' | ' | ($115.20) | ($144) | ($163.50) | |
Tax expense | ' | ' | ' | ' | ' | ' | ' | ' | 54.6 | 39 | 42.7 | |
Net of tax | -24.6 | -26.1 | 3.3 | -13.2 | -35.3 | -23.4 | -22.3 | -24 | -60.6 | -105 | -120.8 | |
Pension and Postretirement Defined Benefit Plan Items [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Amount before tax | ' | ' | ' | ' | ' | ' | ' | ' | 2.7 | [1] | ' | ' |
Tax expense | ' | ' | ' | ' | ' | ' | ' | ' | -1 | ' | ' | |
Net of tax | ' | ' | ' | ' | ' | ' | ' | ' | 1.7 | ' | ' | |
Available-For-Sale Securities and Cash Flow Hedges Items [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Amount before tax | ' | ' | ' | ' | ' | ' | ' | ' | 0.1 | [2] | ' | ' |
Tax expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | |
Net of tax | ' | ' | ' | ' | ' | ' | ' | ' | $0.10 | ' | ' | |
[1] | Reclassified from AOCL into cost of goods sold and selling and administrative expenses. These components are included in the computation of net periodic pension expense and postretirement healthcare costs. | |||||||||||
[2] | Reclassified from AOCL into other income (expense), net. |
RETIREMENT_AND_POSTRETIREMENT_2
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Net Periodic Benefit Cost) (Details) (USD $) | 3 Months Ended | 6 Months Ended | 3 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2014 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Master Defined Benefit Retirement Plan [Member] | Master Defined Benefit Retirement Plan [Member] | Master Defined Benefit Retirement Plan [Member] | Master Defined Benefit Retirement Plan [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' | ' | ' | ' |
Service cost | ' | ' | ' | $5 | $6.10 | $5.50 |
Interest cost | ' | ' | ' | 14.4 | 13.2 | 13.3 |
Expected return on plan assets | ' | ' | ' | -16.7 | -15.9 | -16.7 |
Amortization of unrecognized prior service cost, net | ' | ' | ' | 0.6 | 0.6 | 0.6 |
Amortization of net loss | ' | ' | ' | 3.2 | 7.8 | 6.1 |
Net periodic benefit cost | ' | ' | ' | 6.5 | 11.8 | 8.8 |
Special termination benefits | 3.2 | -1.3 | 2.4 | 2.4 | ' | ' |
Net pension expense | ' | ' | ' | $8.90 | $11.80 | $8.80 |
RETIREMENT_AND_POSTRETIREMENT_3
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Obligations and Funded Status) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Amounts recorded in the Consolidated Balance Sheets: | ' | ' | ' |
Accrued pension benefits, long-term | ($76.90) | ($52.60) | ' |
Master Defined Benefit Retirement Plan [Member] | ' | ' | ' |
Change in benefit obligation: | ' | ' | ' |
Benefit obligation at beginning of year | 297.9 | 327.4 | ' |
Service cost | 5 | 6.1 | 5.5 |
Interest cost | 14.4 | 13.2 | 13.3 |
Actuarial loss (gain) | 31.4 | -41.1 | ' |
Benefits paid | -10.2 | -9.1 | ' |
Acquisitions | 4.3 | ' | ' |
Amendments | ' | 0.6 | ' |
Special termination benefits | 2.4 | ' | ' |
Exchange rate (gain) loss | -1.4 | 0.8 | ' |
Benefit obligation at end of year | 343.8 | 297.9 | 327.4 |
Change in plan assets: | ' | ' | ' |
Fair value of plan assets at beginning of year | 254.4 | 246.8 | ' |
Actual return on plan assets | 30.9 | 15.7 | ' |
Employer contributions | 1 | 1 | ' |
Benefits paid | -10.2 | -9.1 | ' |
Fair value of plan assets at end of year | 276.1 | 254.4 | 246.8 |
Funded status and net amounts recognized | -67.7 | -43.5 | ' |
Amounts recorded in the Consolidated Balance Sheets: | ' | ' | ' |
Accrued pension benefits, current portion | -1 | -0.2 | ' |
Accrued pension benefits, long-term | -66.7 | -43.3 | ' |
Net amount recognized | ($67.70) | ($43.50) | ' |
RETIREMENT_AND_POSTRETIREMENT_4
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Narrative) (Details) (USD $) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' | ' | ' |
Special termination benefits | ($3.20) | $1.30 | ' | ' | ' |
Defined Contribution Savings Plans | ' | ' | ' | ' | ' |
Defined contribution savings plans expense | ' | ' | 15 | 15.8 | 13.3 |
Master Defined Benefit Retirement Plan [Member] | ' | ' | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' | ' | ' |
Special termination benefits | -2.4 | ' | -2.4 | ' | ' |
Net actuarial gains (losses) included in Accumulated Other Comprehensive Income (Loss) | ' | -65 | -65 | -51.3 | ' |
Prior service (credits) costs included in Accumulated Other Comprehensive Income (Loss) | ' | 1.7 | 1.7 | 2.4 | ' |
Pension items in AOCI, aggregate tax effect | ' | 24.8 | 24.8 | 20 | ' |
Estimated net actuarial loss that will be amortized over the next fiscal year | ' | ' | 5.4 | ' | ' |
Estimated prior service cost that will be amortized over the next fiscal year | ' | ' | 0.6 | ' | ' |
Retirement plans (benefit) cost | ' | ' | 8.9 | 11.8 | 8.8 |
Accumulated Benefit Obligation | ' | ' | ' | ' | ' |
Accumulated benefit obligation | ' | 325.9 | 325.9 | 278.8 | ' |
Plan Assets | ' | ' | ' | ' | ' |
Equity securities of one entity, maximum percentage of portfolio | ' | ' | 10.00% | ' | ' |
Cash Flows | ' | ' | ' | ' | ' |
Employer contributions | ' | ' | 1 | 1 | ' |
Postretirement Health Care Plan | ' | ' | ' | ' | ' |
Discount rate for expense | ' | ' | 5.00% | 4.10% | 4.60% |
Discount rate for obligation | ' | 4.50% | 4.50% | 5.00% | 4.10% |
Postretirement Health Care Plan [Member] | ' | ' | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' | ' | ' |
Special termination benefits | -0.8 | ' | ' | ' | ' |
Net actuarial gains (losses) included in Accumulated Other Comprehensive Income (Loss) | ' | 1.7 | 1.7 | 1.8 | ' |
Prior service (credits) costs included in Accumulated Other Comprehensive Income (Loss) | ' | -2.3 | -2.3 | -3 | ' |
Pension items in AOCI, aggregate tax effect | ' | -1.6 | -1.6 | -1.9 | ' |
Estimated net actuarial loss that will be amortized over the next fiscal year | ' | ' | -0.1 | ' | ' |
Estimated prior service cost that will be amortized over the next fiscal year | ' | ' | -0.9 | ' | ' |
Retirement plans (benefit) cost | ' | ' | -0.2 | -0.1 | -0.3 |
Cash Flows | ' | ' | ' | ' | ' |
Employer contributions | ' | ' | 0.1 | 0.3 | ' |
Postretirement Health Care Plan | ' | ' | ' | ' | ' |
Discount rate for expense | ' | ' | 4.10% | 3.30% | 4.00% |
Discount rate for obligation | ' | 3.70% | 3.70% | 4.10% | 3.30% |
Effect of one-percentage-point increase/decrease on service and interest costs | ' | ' | 0.1 | ' | ' |
Effect of one-percentage-point increase on service and benefit obligation | ' | ' | 0.8 | ' | ' |
Effect of one-percentage-point decrease on service and benefit obligation | ' | ' | 0.8 | ' | ' |
Expected employer contributions required in 2015 | ' | ' | 1 | ' | ' |
Defined benefit plan estimated future employer contributions in next fiscal, per year, thereafter | ' | $1 | $1 | ' | ' |
RETIREMENT_AND_POSTRETIREMENT_5
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Accumulated Benefit Obligation) (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
In Millions, unless otherwise specified | |||
Master Plan [Member] | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
PBO | $319.10 | $279.20 | ' |
ABO | 303.2 | 261.7 | ' |
Plan Assets | 275.8 | 254 | ' |
International Plans [Member] | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
PBO | 20.3 | 14.8 | ' |
ABO | 18.5 | 13.4 | ' |
Plan Assets | 0.3 | 0.4 | ' |
Supplemental Executive Plan [Member] | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
PBO | 4.4 | 3.9 | ' |
ABO | 4.2 | 3.7 | ' |
Plan Assets | ' | ' | ' |
Master Defined Benefit Retirement Plan [Member] | ' | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' | ' |
PBO | 343.8 | 297.9 | 327.4 |
ABO | 325.9 | 278.8 | ' |
Plan Assets | $276.10 | $254.40 | $246.80 |
RETIREMENT_AND_POSTRETIREMENT_6
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Actuarial Assumptions) (Details) (Master Defined Benefit Retirement Plan [Member]) | 12 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |
Master Defined Benefit Retirement Plan [Member] | ' | ' | ' |
Weighted average assumptions to determined benefit obligations at the measurement date: | ' | ' | ' |
Discount rate for obligation | 4.50% | 5.00% | 4.10% |
Rate of compensation increase | 3.00% | 3.30% | 3.30% |
Weighted average assumptions to determined benefit cost for the year: | ' | ' | ' |
Discount rate for expense | 5.00% | 4.10% | 4.60% |
Expected rate of return on plan assets | 7.00% | 7.00% | 7.50% |
Rate of compensation increase | 3.30% | 3.30% | 3.50% |
RETIREMENT_AND_POSTRETIREMENT_7
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Allocation of Plan Assets) (Details) (Master Defined Benefit Retirement Plan [Member]) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Defined Benefit Plan Disclosure [Line Items] | ' | ' |
Actual allocation | 100.00% | 100.00% |
Equity Securities [Member] | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' |
Target allocation, minimum | 40.00% | 40.00% |
Target allocation, maximum | 60.00% | 60.00% |
Actual allocation | 52.00% | 57.00% |
Fixed Income Securities [Member] | ' | ' |
Defined Benefit Plan Disclosure [Line Items] | ' | ' |
Target allocation, minimum | 40.00% | 40.00% |
Target allocation, maximum | 60.00% | 60.00% |
Actual allocation | 48.00% | 43.00% |
RETIREMENT_AND_POSTRETIREMENT_8
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Fair Value Measurements of Plan Assets) (Details) (Master Defined Benefit Retirement Plan [Member], USD $) | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
In Millions, unless otherwise specified | |||
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | $276.10 | $254.40 | $246.80 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 209.7 | 204.7 | ' |
Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 66.4 | 49.7 | ' |
Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
Cash [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 2.1 | 3 | ' |
Cash [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 2.1 | 3 | ' |
Cash [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
Cash [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
US Companies [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 101.7 | 101 | ' |
US Companies [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 101.7 | 101 | ' |
US Companies [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
US Companies [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
International Companies [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 38.7 | 41.2 | ' |
International Companies [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 38.7 | 41.2 | ' |
International Companies [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
International Companies [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
Fixed Income Securities [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 133.2 | 108.8 | ' |
Fixed Income Securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 66.8 | 59.1 | ' |
Fixed Income Securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 66.4 | 49.7 | ' |
Fixed Income Securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
Other [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 0.4 | 0.4 | ' |
Other [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | 0.4 | 0.4 | ' |
Other [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
Other [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ' |
Fair Value Measurements of Plan Assets | ' | ' | ' |
Plan assets at fair value | ' | ' | ' |
RETIREMENT_AND_POSTRETIREMENT_9
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Estimated Future Benefit Payments) (Details) (Master Defined Benefit Retirement Plan [Member], USD $) | Sep. 30, 2014 |
In Millions, unless otherwise specified | |
Master Defined Benefit Retirement Plan [Member] | ' |
Estimated Future Benefit Payments | ' |
2015 | $12.60 |
2016 | 13.3 |
2017 | 13.8 |
2018 | 14.5 |
2019 | 15.4 |
2020 - 2024 | $92.20 |
Recovered_Sheet1
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Postretirement Health Care Plan) (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Amounts recorded in the Consolidated Balance Sheets: | ' | ' |
Accrued benefits obligation, long-term | $76.90 | $52.60 |
Postretirement Health Care Plan [Member] | ' | ' |
Change in benefit obligation: | ' | ' |
Benefit obligation at beginning of year | 9.8 | 9.6 |
Service cost | 0.4 | 0.4 |
Interest cost | 0.4 | 0.3 |
Actuarial (gain) loss | -0.2 | -0.2 |
Benefits paid | -0.2 | -0.5 |
Retiree contributions | 0.2 | 0.2 |
Special termination benefits | 0.8 | ' |
Benefit obligation at end of year | 11.2 | 9.8 |
Amounts recorded in the Consolidated Balance Sheets: | ' | ' |
Accrued benefits obligation, current portion | 1.1 | 0.5 |
Accrued benefits obligation, long-term | 10.1 | 9.3 |
Net amount recognized | $11.20 | $9.80 |
Recovered_Sheet2
RETIREMENT AND POSTRETIREMENT BENEFIT PLANS (Schedule of Health Care-Cost Trend Rates) (Details) (Postretirement Health Care Plan [Member]) | 12 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |
Postretirement Health Care Plan [Member] | ' | ' | ' |
Assumed health care cost trend rates: | ' | ' | ' |
Year 1 | 5.75% | 6.25% | 6.75% |
Year 2 | 5.25% | 5.75% | 6.25% |
Year 3 | 5.00% | 5.25% | 5.75% |
Year 4 | 5.00% | 5.00% | 5.25% |
Year 5 | 5.00% | 5.00% | 5.00% |
Year 6 | 5.00% | 5.00% | 5.00% |
Year 7 | 5.00% | 5.00% | 5.00% |
Year 8 and beyond | 5.00% | 5.00% | 5.00% |
COMMON_STOCK_Narrative_Details
COMMON STOCK (Narrative) (Details) (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Share Repurchases | ' | ' | ' |
Value of share repurchase authorization | $190 | ' | ' |
Stock-Based Compensation | ' | ' | ' |
Number of shares authorized | 15,300,000 | ' | ' |
Shares available for future grants | 5,000,000 | ' | ' |
Treasury stock, shares | 22,884,001 | 21,800,520 | ' |
Stock Options [Member] | ' | ' | ' |
Stock-Based Compensation | ' | ' | ' |
Maximum contractual term | '10 years | ' | ' |
Total intrinsic value of options exercised | 4.6 | 1.6 | 1.3 |
Unrecognized compensation expense | 4.7 | ' | ' |
Unrecognized compensation expense, weighted-average recognition period | '1 year 10 months 24 days | ' | ' |
Stock Options [Member] | Minimum [Member] | ' | ' | ' |
Stock-Based Compensation | ' | ' | ' |
Vesting period | '3 years | ' | ' |
Stock Options [Member] | Maximum [Member] | ' | ' | ' |
Stock-Based Compensation | ' | ' | ' |
Vesting period | '4 years | ' | ' |
Restricted Stock Units (RSUs) [Member] | ' | ' | ' |
Stock-Based Compensation | ' | ' | ' |
Unrecognized compensation expense | 7.5 | ' | ' |
Unrecognized compensation expense, weighted-average recognition period | '2 years | ' | ' |
Total vest date fair value of shares that vested | 6.7 | 5.8 | 6.8 |
Restricted Stock Units (RSUs) [Member] | Minimum [Member] | ' | ' | ' |
Stock-Based Compensation | ' | ' | ' |
Vesting period | '1 year | ' | ' |
Restricted Stock Units (RSUs) [Member] | Maximum [Member] | ' | ' | ' |
Stock-Based Compensation | ' | ' | ' |
Vesting period | '4 years | ' | ' |
Performance Shares [Member] | ' | ' | ' |
Stock-Based Compensation | ' | ' | ' |
Unrecognized compensation expense | 8.6 | ' | ' |
Common Stock [Member] | ' | ' | ' |
Share Repurchases | ' | ' | ' |
Shares repurchased | 1,700,000 | 2,800,000 | 1,500,000 |
Value of shares repurchased | $70.50 | $92.70 | $42.40 |
COMMON_STOCK_Schedule_of_Stock
COMMON STOCK (Schedule of Stock-Based Compensation Cost) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
COMMON STOCK [Abstract] | ' | ' | ' |
Total stock-based compensation cost (pre-tax) | $18 | $13.50 | $11.60 |
Total income tax benefit | -6.5 | -4.9 | -4.2 |
Total stock-based compensation cost, net of tax | $11.50 | $8.60 | $7.40 |
COMMON_STOCK_Schedule_of_Weigh
COMMON STOCK (Schedule of Weighted Average Fair Value per Share of Stock Options and Related Valuation Assumptions) (Details) (Stock Options [Member], USD $) | 12 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |
Stock Options [Member] | ' | ' | ' |
Stock Options | ' | ' | ' |
Weighted average fair value per share | $11.91 | $7.91 | $9.79 |
Valuation assumptions: | ' | ' | ' |
Risk-free interest rate | 1.30% | 0.60% | 1.00% |
Expected dividend yield | 1.40% | 1.90% | 1.40% |
Expected volatility | 36.10% | 40.20% | 41.20% |
Weighted average expected life | '4 years 10 months 24 days | '4 years 10 months 24 days | '4 years 9 months 18 days |
COMMON_STOCK_Schedule_of_Trans
COMMON STOCK (Schedule of Transactions under Stock Option Plans) (Details) (USD $) | 12 Months Ended | |
In Millions, except Share data in Thousands, unless otherwise specified | Sep. 30, 2014 | |
Stock-Based Compensation | ' | |
Closing stock price | $41.43 | |
Stock Options [Member] | ' | |
Weighted Average Number of Shares | ' | |
Balance Outstanding at October 1, 2013 | 2,163 | |
Granted | 367 | |
Exercised | -376 | |
Cancelled/Forfeited | -162 | |
Balance Outstanding at September 30, 2014 | 1,992 | |
Exercisable at September 30, 2014 | 1,013 | |
Options Expected to Vest | 897 | |
Weighted Average Exercise Price | ' | |
Balance Outstanding at October 1, 2013 | $29.89 | |
Granted | $41.47 | |
Exercised | $27.85 | |
Cancelled/Forfeited | $35.18 | |
Balance Outstanding at September 30, 2014 | $31.99 | |
Exercisable at September 30, 2014 | $30.12 | |
Options Expected to Vest | $33.80 | |
Weighted Average Remaining Contractual Term | ' | |
Balance Outstanding at September 30, 2014 | '6 years 10 months 24 days | |
Exercisable at September 30, 2014 | '5 years 8 months 12 days | |
Options Expected to Vest | '8 years | |
Aggregate Intrinsic Value | ' | |
Balance Outstanding at September 30, 2014 | $18.90 | [1] |
Exercisable at September 30, 2014 | 11.5 | [1] |
Options Expected to Vest | $6.90 | [1] |
[1] | The aggregate intrinsic value represents the total pre-tax intrinsic value, based on our closing stock price of $41.43, as reported by the New York Stock Exchange on September 30, 2014. This amount, which changes continuously based on the fair value of our common stock, would have been received by the option holders had all option holders exercised their options as of the balance sheet date. |
COMMON_STOCK_Schedule_of_Trans1
COMMON STOCK (Schedule of Transactions for Nonvested RSUs) (Details) (Restricted Stock Units (RSUs) [Member], USD $) | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 |
Restricted Stock Units (RSUs) [Member] | ' |
Number of Share Units | ' |
Nonvested at October 1, 2013 | 341 |
Granted | 263 |
Vested | -98 |
Forfeited | -75 |
Nonvested at September 30, 2014 | 431 |
Weighted Average Grant Date Fair Value | ' |
Nonvested at October 1, 2013 | $29.34 |
Granted | $41.01 |
Vested | $30.39 |
Forfeited | $36.24 |
Nonvested at September 30, 2014 | $34.92 |
COMMON_STOCK_Schedule_of_Weigh1
COMMON STOCK (Schedule of Weighted Average Fair Value per Share PSUs and Related Valuation Assumptions) (Details) (Performance Shares [Member], USD $) | 12 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Performance Shares [Member] | ' | ' |
Performance Share Units | ' | ' |
Weighted average fair value per share | $47.91 | $19.77 |
Valuation assumptions: | ' | ' |
Risk-free interest rate | 0.50% | 0.30% |
Expected dividend yield | 0.00% | 0.00% |
Expected volatility | 30.10% | 32.60% |
COMMON_STOCK_Schedule_of_Trans2
COMMON STOCK (Schedule of Transactions for Nonvested PSUs) (Details) (Performance Shares [Member], USD $) | 12 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 |
Performance Shares [Member] | ' |
Number of Share Units | ' |
Nonvested at October 1, 2013 | 574 |
Granted | 205 |
Vested | ' |
Cancelled | -122 |
Forfeited | -71 |
Nonvested at September 30, 2014 | 586 |
Weighted Average Grant Date Fair Value | ' |
Nonvested at October 1, 2013 | $23.84 |
Granted | $47.91 |
Vested | ' |
Cancelled | $31.13 |
Forfeited | $30.08 |
Nonvested at September 30, 2014 | $29.98 |
SPECIAL_CHARGES_Narrative_Deta
SPECIAL CHARGES (Narrative) (Details) (USD $) | 12 Months Ended | 3 Months Ended | 6 Months Ended | 12 Months Ended | 3 Months Ended | 6 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||||||||||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Sep. 30, 2012 | Mar. 31, 2012 | Sep. 30, 2012 | Sep. 30, 2012 |
Fiscal 2014 Actions [Member] | Global Restructuring Program [Member] | Global Restructuring Program [Member] | Global Restructuring Program [Member] | Global Restructuring Program [Member] | Global Restructuring Program [Member] | Global Restructuring Program [Member] | Global Restructuring Program [Member] | Global Restructuring Program [Member] | Global Restructuring Program [Member] | Plan to Discontinue Third Party Payer Rentals [Member] | Plan to Discontinue Third Party Payer Rentals [Member] | Plan to Discontinue Third Party Payer Rentals [Member] | Plan to Discontinue Third Party Payer Rentals [Member] | Batesville, Indiana Plant Restructuring [Member] | Fiscal 2013 Action [Member] | Fiscal 2013 Action [Member] | Fiscal 2013 Action [Member] | Fiscal 2013 Action [Member] | Fiscal 2013 Action [Member] | Fiscal 2013 Action [Member] | Fiscal 2012 Action [Member] | Fiscal 2012 Action [Member] | Fiscal 2012 Action [Member] | Fiscal 2012 Action [Member] | Fiscal 2012 Action [Member] | ||||
employees | Employee Termination and Severance [Member] | Employee Termination and Severance [Member] | Special Termination Benefits [Member] | Other Restructuring [Member] | Minimum [Member] | Maximum [Member] | employees | Employee Termination and Severance [Member] | Other Restructuring [Member] | employees | employees | Employee Termination and Severance [Member] | Lease and Other Contract Termination [Member] | Other Restructuring [Member] | employees | employees | Employee Termination and Severance [Member] | Employee Termination and Severance [Member] | |||||||||||
Europe [Member] | Europe [Member] | Europe [Member] | Europe [Member] | ||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Special charge | $37.10 | $5.70 | $18.20 | ' | ' | ' | ' | $11 | $6.80 | $3.20 | $4.60 | ' | ' | ' | ' | $2 | $1.80 | $1 | $2 | $0.80 | ' | $1.70 | $0.60 | $1 | ' | ' | ' | $1 | $9.30 |
Impairment of certain tangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 7.7 | ' | ' | ' | ' | ' | ' | 0.2 | ' | ' | ' | ' | 4.7 | 3.2 | ' | ' |
Number of positions eliminated | ' | ' | ' | ' | 200 | ' | ' | ' | ' | ' | ' | ' | ' | 70 | ' | ' | ' | 35 | ' | ' | 100 | ' | ' | ' | ' | 100 | 200 | ' | ' |
Expected additional costs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15 | 20 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment of other intangibles | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8 | ' | ' |
Reversals | $0.80 | ' | ' | $0.70 | ' | $1.30 | $0.70 | ' | ' | ' | ' | ' | ' | ' | $0.20 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.60 | ' | ' | ' | ' |
SPECIAL_CHARGES_Schedule_of_Re
SPECIAL CHARGES (Schedule of Restructuring Activity) (Details) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2014 |
Restructuring Reserve [Roll Forward] | ' |
Beginning Balance | $2.90 |
Expenses | 20.8 |
Cash Payments | -11.2 |
Reversals | -0.8 |
Ending Balance | 11.7 |
Fiscal 2014 Actions [Member] | ' |
Restructuring Reserve [Roll Forward] | ' |
Beginning Balance | ' |
Expenses | 20.8 |
Cash Payments | -8.6 |
Reversals | -0.7 |
Ending Balance | 11.5 |
Prior Restructuring Actions [Member] | ' |
Restructuring Reserve [Roll Forward] | ' |
Beginning Balance | 2.9 |
Expenses | ' |
Cash Payments | -2.6 |
Reversals | -0.1 |
Ending Balance | $0.20 |
INCOME_TAXES_Schedule_of_Compo
INCOME TAXES (Schedule of Components of Income before Income Taxes and the Consolidated Income Tax Provision) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Income before income taxes: | ' | ' | ' |
Domestic | $87 | $120 | $148.60 |
Foreign | 28.2 | 24 | 14.9 |
Total | 115.2 | 144 | 163.5 |
Current provision | ' | ' | ' |
Federal | 40.2 | 45 | 65.9 |
State | 3.1 | 1.8 | 4.3 |
Foreign | 7.4 | 7 | 4.8 |
Total current provision | 50.7 | 53.8 | 75 |
Deferred provision: | ' | ' | ' |
Federal | -12.2 | -9.9 | -29.2 |
State | -1 | 1.1 | 0.1 |
Foreign | 17.1 | -6 | -3.2 |
Total deferred provision | 3.9 | -14.8 | -32.3 |
Income tax expense | $54.60 | $39 | $42.70 |
INCOME_TAXES_Schedule_of_Diffe
INCOME TAXES (Schedule of Differences between Income Tax Expense) (Details) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |||
Amount | ' | ' | ' | |||
Federal income tax | $40.30 | [1] | $50.40 | [1] | $57.20 | [1] |
State income tax | 2 | [2] | 2.5 | [2] | 3.5 | [2] |
Foreign income tax | -7.7 | [3] | -5.7 | [3] | -3.4 | [3] |
International tax restructuring | ' | -0.8 | -11 | |||
Application of federal tax credits | -0.6 | -3.5 | -0.6 | |||
Adjustment of estimated income tax accruals | -0.6 | -1.5 | -2.1 | |||
Valuation of tax attributes | 21.3 | 0.6 | 0.3 | |||
Other, net | -0.1 | -3 | -1.2 | |||
Income tax expense | $54.60 | $39 | $42.70 | |||
% of Pretax Income | ' | ' | ' | |||
Federal income tax | 35.00% | [1] | 35.00% | [1] | 35.00% | [1] |
State income tax | 1.70% | [2] | 1.70% | [2] | 2.20% | [2] |
Foreign income tax | -6.70% | [3] | -4.00% | [3] | -2.10% | [3] |
International tax restructuring | ' | -0.60% | -6.70% | |||
Application of federal tax credits | -0.50% | -2.40% | -0.40% | |||
Adjustment of estimated income tax accruals | -0.50% | -1.00% | -1.30% | |||
Valuation of tax attributes | 18.50% | 0.40% | 0.20% | |||
Other, net | -0.10% | -2.00% | -0.80% | |||
Income tax expense | 47.40% | 27.10% | 26.10% | |||
[1] | At statutory rate. | |||||
[2] | Net of Federal benefit. | |||||
[3] | Federal tax rate differential. |
INCOME_TAXES_Schedule_of_Defer
INCOME TAXES (Schedule of Deferred Taxes) (Details) (USD $) | Sep. 30, 2014 | Sep. 30, 2013 |
In Millions, unless otherwise specified | ||
Deferred tax assets: | ' | ' |
Employee benefit accruals | $49.30 | $46.60 |
Inventory | 13.9 | 7.4 |
Reserve for bad debts | 10 | 10.1 |
Accrued warranty | 7.3 | 9.7 |
Net operating loss carryforwards | 40.3 | 38.3 |
Tax credit carryforwards | 2.5 | 2 |
Other, net | 18.4 | 16.3 |
Deferred Tax Assets, Gross, Total | 141.7 | 130.4 |
Less: Valuation allowance | -28.3 | -8.9 |
Total deferred tax assets | 113.4 | 121.5 |
Deferred tax liabilities: | ' | ' |
Depreciation | -13.9 | -32.1 |
Amortization | -62.8 | -67.5 |
Other, net | -4.9 | -3.2 |
Total deferred tax liabilities | -81.6 | -102.8 |
Deferred tax asset - net | $31.80 | $18.70 |
INCOME_TAXES_Narrative_Details
INCOME TAXES (Narrative) (Details) (USD $) | 12 Months Ended | |||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2011 |
Income taxes: | ' | ' | ' | ' |
Deferred tax assets related to operating loss carryforwards in foreign jurisdictions | $37.40 | ' | ' | ' |
Deferred tax assets related to domestic federal net operating loss carryforwards | 2 | ' | ' | ' |
Deferred tax assets related to state net operating loss carryforwards | 0.9 | ' | ' | ' |
Deferred tax assets related to state credits | 2.5 | ' | ' | ' |
One-time tax benefit related to restructuring of a portion of international operations | ' | -0.8 | -11 | ' |
Valuation allowance on deferred tax assets | 28.3 | 8.9 | ' | ' |
Estimated decrease in unrecognized tax benefits, lower bound | 3 | ' | ' | ' |
Estimated decrease in unrecognized tax benefits, upper bound | 4 | ' | ' | ' |
Total gross unrecognized tax benefits | 4.1 | 4.6 | 9.8 | 17.8 |
Unrecognized tax benefits that would impact effective tax rate, if recognized | 2.7 | 3.9 | 8.4 | ' |
Accrued interest and penalties related to unrecognized tax benefits | 0.4 | 0.6 | 0.8 | ' |
Income tax expense for interest and penalties | 0.2 | 0.1 | 0.1 | ' |
Income Tax Holiday [Line Items] | ' | ' | ' | ' |
Impact of tax holidays | $4 | $2.90 | $1.70 | ' |
Benefit of tax holidays on net income per share (diluted) | $0.07 | $0.05 | $0.03 | ' |
Inland Revenue, Singapore (IRAS) [Member] | ' | ' | ' | ' |
Income Tax Holiday [Line Items] | ' | ' | ' | ' |
Income tax holiday, year of expiration | '2016 | ' | ' | ' |
Puerto Rico Tax Authority [Member] | ' | ' | ' | ' |
Income Tax Holiday [Line Items] | ' | ' | ' | ' |
Income tax holiday, year of expiration | '2025 | ' | ' | ' |
Domestic Tax Authority [Member] | ' | ' | ' | ' |
Income taxes: | ' | ' | ' | ' |
Operating loss carryforwards, year of expiration | 31-Dec-33 | ' | ' | ' |
Earliest Tax Year [Member] | State and Local Jurisdiction [Member] | ' | ' | ' | ' |
Income taxes: | ' | ' | ' | ' |
Operating loss carryforwards, year of expiration | 1-Jan-18 | ' | ' | ' |
Tax credit carryforwards, year of expiration | 1-Jan-14 | ' | ' | ' |
Latest Tax Year [Member] | State and Local Jurisdiction [Member] | ' | ' | ' | ' |
Income taxes: | ' | ' | ' | ' |
Operating loss carryforwards, year of expiration | 31-Dec-26 | ' | ' | ' |
Tax credit carryforwards, year of expiration | 31-Dec-26 | ' | ' | ' |
INCOME_TAXES_Reconciliation_of
INCOME TAXES (Reconciliation of Unrecognized Tax Benefits) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | ' | ' | ' |
Balance at October 1 | $4.60 | $9.80 | $17.80 |
Increases in tax position of prior years | 2.1 | ' | 0.5 |
Decreases in tax position of prior years | -0.9 | -0.5 | -2.7 |
Increases in tax positions related to the current year | ' | 0.1 | ' |
Settlements with taxing authorities | -0.1 | -3.2 | -3.8 |
Lapse of applicable statute of limitations | -1.5 | -1.7 | -1.9 |
Foreign currency adjustments | ' | 0.1 | ' |
Foreign currency adjustments | -0.1 | ' | -0.1 |
Total change | -0.5 | -5.2 | -8 |
Balance at September 30 | $4.10 | $4.60 | $9.80 |
EARNINGS_PER_COMMON_SHARE_Deta
EARNINGS PER COMMON SHARE (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Share data, unless otherwise specified | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
EARNINGS PER COMMON SHARE [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income attributable to common shareholders | ' | ' | ' | ' | ' | ' | ' | ' | $60.60 | $105 | $120.80 |
Average shares outstanding - Basic (thousands) | ' | ' | ' | ' | ' | ' | ' | ' | 57,555,000 | 59,910,000 | 62,120,000 |
Add potential effect of exercise of stock options and other unvested equity awards (thousands) | ' | ' | ' | ' | ' | ' | ' | ' | 968,000 | 340,000 | 241,000 |
Average shares outstanding - Diluted (thousands) | ' | ' | ' | ' | ' | ' | ' | ' | 58,523,000 | 60,250,000 | 62,361,000 |
Net income per Common Share - Basic | $0.43 | $0.46 | ($0.06) | $0.23 | $0.60 | $0.39 | $0.37 | $0.39 | $1.05 | $1.75 | $1.94 |
Net income per Common Share - Diluted | $0.42 | $0.45 | ($0.06) | $0.22 | $0.59 | $0.39 | $0.37 | $0.39 | $1.04 | $1.74 | $1.94 |
Shares with anti-dilutive effect excluded from the computation of Diluted EPS | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | 1,400,000 | 1,400,000 |
SEGMENT_REPORTING_Schedule_of_
SEGMENT REPORTING (Schedule of Segment Information) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
units | |||||||||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of reportable business segments | ' | ' | ' | ' | ' | ' | ' | ' | 3 | ' | ' |
Revenue | $479.80 | $397.60 | $415.30 | $393.40 | $437.90 | $424.20 | $425.70 | $428.40 | $1,686.10 | $1,716.20 | $1,634.30 |
Impairment of goodwill and other intangibles | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8 |
Litigation (credit) charge | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -3.6 |
Special charge | ' | ' | ' | ' | ' | ' | ' | ' | 37.1 | 5.7 | 18.2 |
Operating profit | ' | ' | ' | ' | ' | ' | ' | ' | 122.6 | 154.9 | 168.8 |
Interest expense | ' | ' | ' | ' | ' | ' | ' | ' | -9.8 | -9.5 | -6.5 |
Investment income and other, net | ' | ' | ' | ' | ' | ' | ' | ' | 2.4 | -1.4 | 1.2 |
Income Before Income Taxes | ' | ' | ' | ' | ' | ' | ' | ' | 115.2 | 144 | 163.5 |
Corporate and Other [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Operating profit | ' | ' | ' | ' | ' | ' | ' | ' | -98.8 | -131.4 | -99.3 |
Segment Reconciling Items [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment of goodwill and other intangibles | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 8 |
Litigation (credit) charge | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -3.6 |
Special charge | ' | ' | ' | ' | ' | ' | ' | ' | 37.1 | 5.7 | 18.2 |
North America Segment [Member] | Operating Segments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | ' | ' | ' | ' | ' | ' | ' | ' | 888.9 | 958.3 | 998.2 |
Operating profit | ' | ' | ' | ' | ' | ' | ' | ' | 165 | 201.7 | 215.4 |
Surgical and Respiratory Care Segment [Member] | Operating Segments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | ' | ' | ' | ' | ' | ' | ' | ' | 301.6 | 245.8 | 153.2 |
Operating profit | ' | ' | ' | ' | ' | ' | ' | ' | 68.6 | 56.8 | 43.9 |
International [Member] | Operating Segments [Member] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenue | ' | ' | ' | ' | ' | ' | ' | ' | 495.6 | 512.1 | 482.9 |
Operating profit | ' | ' | ' | ' | ' | ' | ' | ' | $24.90 | $33.50 | $31.40 |
SEGMENT_REPORTING_Schedule_of_1
SEGMENT REPORTING (Schedule of Geographic Information) (Details) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |||
Geographic Information | ' | ' | ' | |||
Revenue | $1,686.10 | [1] | $1,716.20 | [1] | $1,634.30 | [1] |
Long-lived assets | 261.5 | [2] | 234.3 | [2] | 250.1 | [2] |
United States [Member] | ' | ' | ' | |||
Geographic Information | ' | ' | ' | |||
Revenue | 1,070.80 | [1] | 1,116.40 | [1] | 1,077.80 | [1] |
Long-lived assets | 151.7 | [2] | 158 | [2] | 172.5 | [2] |
Foreign [Member] | ' | ' | ' | |||
Geographic Information | ' | ' | ' | |||
Revenue | 615.3 | [1] | 599.8 | [1] | 556.5 | [1] |
Long-lived assets | $109.80 | [2] | $76.30 | [2] | $77.60 | [2] |
[1] | Net revenue is attributed to geographic areas based on the location of the customer. | |||||
[2] | Includes property and equipment leased to others. |
QUARTERLY_FINANCIAL_INFORMATIO2
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
QUARTERLY FINANCIAL INFORMATION (UNAUDITED) [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net revenue | $479.80 | $397.60 | $415.30 | $393.40 | $437.90 | $424.20 | $425.70 | $428.40 | $1,686.10 | $1,716.20 | $1,634.30 |
Gross profit | 213.3 | 187.1 | 202.7 | 176.8 | 202.7 | 190.1 | 196.1 | 191.4 | 779.9 | 780.3 | 754.7 |
Net income (loss) | $24.60 | $26.10 | ($3.30) | $13.20 | $35.30 | $23.40 | $22.30 | $24 | $60.60 | $105 | $120.80 |
Basic net income (loss) per common share | $0.43 | $0.46 | ($0.06) | $0.23 | $0.60 | $0.39 | $0.37 | $0.39 | $1.05 | $1.75 | $1.94 |
Diluted net income (loss) per common share | $0.42 | $0.45 | ($0.06) | $0.22 | $0.59 | $0.39 | $0.37 | $0.39 | $1.04 | $1.74 | $1.94 |
COMMITMENTS_AND_CONTINGENCIES_1
COMMITMENTS AND CONTINGENCIES (Lease Commitments and Long-Term Agreement) (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 |
Lease Commitments | ' | ' | ' |
Rental expense | $24.70 | $21.50 | $20.70 |
Minimum annual rental commitments | 62.9 | ' | ' |
2015 | 22.5 | ' | ' |
2016 | 16.6 | ' | ' |
2017 | 12.5 | ' | ' |
2018 | 6.9 | ' | ' |
2019 | 1.7 | ' | ' |
2020 and beyond | $2.70 | ' | ' |
COMMITMENTS_AND_CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Self Insurance and Legal Proceedings) (Details) (Uninsured Risk [Member], USD $) | Sep. 30, 2014 |
Uninsured Risk [Member] | ' |
Loss Contingencies [Line Items] | ' |
Deductibles and self-insured retentions, minimum | $25,000 |
Deductibles and self-insured retentions, maximum | $1,000,000 |
Valuation_and_Qualifying_Accou1
Valuation and Qualifying Accounts (Details) (USD $) | 12 Months Ended | |||||
In Millions, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | |||
Allowance for Possible Losses and Sales Returns - Accounts Receivable [Member] | ' | ' | ' | |||
Reserves deducted from assets to which they apply: | ' | ' | ' | |||
BALANCE AT BEGINNING OF PERIOD | $30.10 | $38.50 | $26.70 | |||
CHARGED TO COSTS AND EXPENSES | 1.5 | 2.7 | 1.6 | |||
CHARGED TO OTHER ACCOUNTS | 8.6 | [1] | -0.1 | [1] | 18.5 | [1] |
DEDUCTIONS NET OF RECOVERIES | -8.8 | [2] | -11 | [2] | -8.3 | [2] |
BALANCE AT END OF PERIOD | 31.4 | 30.1 | 38.5 | |||
Allowance for Inventory Valuation [Member] | ' | ' | ' | |||
Reserves deducted from assets to which they apply: | ' | ' | ' | |||
BALANCE AT BEGINNING OF PERIOD | 22 | 22 | 22.9 | |||
CHARGED TO COSTS AND EXPENSES | 4 | 1.8 | 2.2 | |||
CHARGED TO OTHER ACCOUNTS | 19.8 | [3] | ' | [3] | 1.6 | [3] |
DEDUCTIONS NET OF RECOVERIES | -2.9 | [4] | -1.8 | [4] | -4.7 | [4] |
BALANCE AT END OF PERIOD | 42.9 | 22 | 22 | |||
Valuation Allowance Against Deferred Tax Assets [Member] | ' | ' | ' | |||
Reserves deducted from assets to which they apply: | ' | ' | ' | |||
BALANCE AT BEGINNING OF PERIOD | 8.9 | 8.6 | 8.1 | |||
CHARGED TO COSTS AND EXPENSES | 21.3 | 0.6 | 0.4 | |||
CHARGED TO OTHER ACCOUNTS | ' | ' | ' | |||
DEDUCTIONS NET OF RECOVERIES | -1.9 | [5] | -0.3 | [5] | 0.1 | [5] |
BALANCE AT END OF PERIOD | $28.30 | $8.90 | $8.60 | |||
[1] | Reduction of gross revenue for uncollectible health care rental reimbursements, cash discounts and other adjustments in determining net revenue. Also includes the effect of acquired businesses, if any. | |||||
[2] | Generally reflects the write-off of specific receivables against recorded reserves. | |||||
[3] | Generally reflects the effect of acquired businesses, if any. | |||||
[4] | Generally reflects the write-off of specific inventory against recorded reserves. | |||||
[5] | Primarily reflects write-offs of deferred tax assets against the valuation allowance and other movement of the valuation allowance offset by an opposing change in deferred tax assets. |