Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 03, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2020 | |
Entity File Number | 0-16211 | |
Entity Registrant Name | DENTSPLY SIRONA Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 39-1434669 | |
Entity Address, Address Line One | 13320 Ballantyne Corporate Place | |
Entity Address, City or Town | Charlotte | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 28277-3607 | |
City Area Code | 844 | |
Local Phone Number | 848-0137 | |
Title of 12(b) Security | Common Stock, par value $.01 per share | |
Trading Symbol | XRAY | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Small Business Entity | false | |
Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 218,555,259 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Central Index Key | 0000818479 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
Total net sales | $ 894,800,000 | $ 962,100,000 | $ 2,259,700,000 | $ 2,917,700,000 |
Cost of products sold | 452,500,000 | 448,100,000 | 1,173,500,000 | 1,363,200,000 |
Gross profit | 442,300,000 | 514,000,000 | 1,086,200,000 | 1,554,500,000 |
Selling, general, and administrative expenses | 341,900,000 | 399,300,000 | 1,014,500,000 | 1,262,100,000 |
Goodwill impairment | 0 | 0 | 156,600,000 | 0 |
Restructuring and other costs | 18,700,000 | 5,200,000 | 62,500,000 | 68,100,000 |
Operating income (loss) | 81,700,000 | 109,500,000 | (147,400,000) | 224,300,000 |
Other income and expenses: | ||||
Interest expense | 14,500,000 | 6,600,000 | 33,500,000 | 23,000,000 |
Interest income | (400,000) | (700,000) | (1,800,000) | (2,000,000) |
Other expense (income), net | 900,000 | (2,900,000) | 3,800,000 | (4,600,000) |
Income (loss) before income taxes | 66,700,000 | 106,500,000 | (182,900,000) | 207,900,000 |
Provision (benefit) for income taxes | 12,500,000 | 21,500,000 | (1,300,000) | 47,300,000 |
Net income (loss) | 54,200,000 | 85,000,000 | (181,600,000) | 160,600,000 |
Less: Net income (loss) attributable to noncontrolling interest | 400,000 | 0 | (100,000) | 0 |
Net income (loss) attributable to Dentsply Sirona | $ 53,800,000 | $ 85,000,000 | $ (181,500,000) | $ 160,600,000 |
Net income (loss) per common share attributable to Dentsply Sirona: | ||||
Basic (in dollars per share) | $ 0.25 | $ 0.38 | $ (0.83) | $ 0.72 |
Diluted (in dollars per share) | $ 0.25 | $ 0.38 | $ (0.83) | $ 0.71 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 218.5 | 223.1 | 219.4 | 223.5 |
Diluted (in shares) | 219.2 | 224.9 | 219.4 | 225.2 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 54.2 | $ 85 | $ (181.6) | $ 160.6 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation gain (loss) | 84.8 | (127.5) | 40 | (144.8) |
Net (loss) gain on derivative financial instruments | (19.3) | 20.1 | (22.2) | 12 |
Pension liability gain | 1.6 | 0.9 | 4.7 | 2.7 |
Total other comprehensive income (loss), net of tax | 67.1 | (106.5) | 22.5 | (130.1) |
Total comprehensive income (loss) | 121.3 | (21.5) | (159.1) | 30.5 |
Less: Comprehensive income attributable to noncontrolling interests | 0 | 0 | 0.4 | 0.3 |
Total comprehensive income (loss) attributable to Dentsply Sirona | $ 121.3 | $ (21.5) | $ (159.5) | $ 30.2 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Current Assets: | ||
Cash and cash equivalents | $ 1,272 | $ 404.9 |
Accounts and notes receivables-trade, net | 628.1 | 782 |
Inventories, net | 489.1 | 561.7 |
Prepaid expenses and other current assets | 190.4 | 251.3 |
Total Current Assets | 2,579.6 | 1,999.9 |
Property, plant and equipment, net | 772.4 | 802.4 |
Operating lease right-of-use assets, net | 144.1 | 159.3 |
Identifiable intangible assets, net | 2,058.1 | 2,176.3 |
Goodwill | 3,282.7 | 3,396.5 |
Other noncurrent assets | 59 | 68.5 |
Total Assets | 8,895.9 | 8,602.9 |
Current Liabilities: | ||
Accounts payable | 242.8 | 307.9 |
Accrued liabilities | 564.1 | 629.2 |
Income taxes payable | 75.2 | 56.1 |
Notes payable and current portion of long-term debt | 296.1 | 2.3 |
Total Current Liabilities | 1,178.2 | 995.5 |
Long-term debt | 1,930 | 1,433.1 |
Operating lease liabilities | 105.4 | 119.5 |
Deferred income taxes | 423.1 | 479.6 |
Other noncurrent liabilities | 496.9 | 480.3 |
Total Liabilities | 4,133.6 | 3,508 |
Commitments and contingencies | 0 | 0 |
Equity: | ||
Preferred stock, $1.00 par value; 0.25 million shares authorized; no shares issued | 0 | 0 |
Common stock, $0.01 par value; | 2.6 | 2.6 |
Capital in excess of par value | 6,592.4 | 6,586.7 |
Retained earnings | 1,156.2 | 1,404.2 |
Accumulated other comprehensive loss | (577.6) | (599.7) |
Treasury stock, at cost, 46.0 million and 43.2 million shares at September 30, 2020 and December 31, 2019, respectively | (2,413.1) | (2,301.3) |
Total Dentsply Sirona Equity | 4,760.5 | 5,092.5 |
Noncontrolling interests | 1.8 | 2.4 |
Total Equity | 4,762.3 | 5,094.9 |
Total Liabilities and Equity | $ 8,895.9 | $ 8,602.9 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
Equity: | ||
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized (in shares) | 250,000 | 250,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common stock, shares issued (in shares) | 264,500,000 | 264,500,000 |
Common stock, shares outstanding (in shares) | 218,500,000 | 221,300,000 |
Treasury stock, shares (in shares) | 46,000,000 | 43,200,000 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) $ in Millions | Total | Total Dentsply Sirona Equity | Common Stock | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | Noncontrolling Interests |
Beginning Balance at Dec. 31, 2018 | $ 5,133 | $ 5,121.1 | $ 2.6 | $ 6,522.3 | $ 1,225.9 | $ (478.7) | $ (2,151) | $ 11.9 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net (loss) income | 39.2 | 39.2 | 39.2 | 0 | ||||
Other comprehensive (loss) income | (58.4) | (58.7) | (58.7) | 0.3 | ||||
Divestiture of noncontrolling interest | (10.4) | (10.4) | ||||||
Exercise of stock options | 19.7 | 19.7 | 1.5 | 18.2 | ||||
Stock based compensation expense | 9.1 | 9.1 | 9.1 | |||||
Funding of employee stock purchase plan | 2 | 2 | 0.1 | 1.9 | ||||
Restricted stock unit distributions | (4.8) | (4.8) | (12.8) | 8 | ||||
Restricted stock unit dividends | 0 | 0.2 | (0.2) | |||||
Cash dividends | (19.9) | (19.9) | (19.9) | |||||
Ending Balance at Mar. 31, 2019 | $ 5,109.5 | 5,107.7 | 2.6 | 6,520.4 | 1,245 | (537.4) | (2,122.9) | 1.8 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Cash dividends (in dollars per share) | $ 0.0875 | |||||||
Beginning Balance at Dec. 31, 2018 | $ 5,133 | 5,121.1 | 2.6 | 6,522.3 | 1,225.9 | (478.7) | (2,151) | 11.9 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net (loss) income | 160.6 | |||||||
Other comprehensive (loss) income | (130.1) | (130.4) | ||||||
Ending Balance at Sep. 30, 2019 | 5,059.1 | 5,057.3 | 2.6 | 6,567.2 | 1,324.3 | (609.1) | (2,227.7) | 1.8 |
Beginning Balance at Mar. 31, 2019 | 5,109.5 | 5,107.7 | 2.6 | 6,520.4 | 1,245 | (537.4) | (2,122.9) | 1.8 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net (loss) income | 36.4 | 36.4 | 36.4 | 0 | ||||
Other comprehensive (loss) income | 34.8 | 34.8 | 34.8 | 0 | ||||
Exercise of stock options | 56.5 | 56.5 | 6.3 | 50.2 | ||||
Stock based compensation expense | 25.2 | 25.2 | 25.2 | |||||
Treasury shares purchased | (60) | (60) | (60) | |||||
Restricted stock unit distributions | (0.1) | (0.1) | (0.8) | 0.7 | ||||
Restricted stock unit dividends | 0 | 0.2 | (0.2) | |||||
Cash dividends | (19.4) | (19.4) | (19.4) | |||||
Ending Balance at Jun. 30, 2019 | $ 5,182.9 | 5,181.1 | 2.6 | 6,551.3 | 1,261.8 | (502.6) | (2,132) | 1.8 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Cash dividends (in dollars per share) | $ 0.0875 | |||||||
Net (loss) income | $ 85 | 85 | 85 | 0 | ||||
Other comprehensive (loss) income | (106.5) | (106.5) | (106.5) | 0 | ||||
Exercise of stock options | 2.4 | 2.4 | 0.4 | 2 | ||||
Stock based compensation expense | 15.4 | 15.4 | 15.4 | |||||
Funding of employee stock purchase plan | 2.2 | 2.2 | 0.2 | 2 | ||||
Treasury shares purchased | (100) | (100) | (100) | |||||
Restricted stock unit distributions | (0.1) | (0.1) | (0.4) | 0.3 | ||||
Restricted stock unit dividends | 0 | 0.3 | (0.3) | |||||
Cash dividends | (22.2) | (22.2) | (22.2) | |||||
Ending Balance at Sep. 30, 2019 | $ 5,059.1 | 5,057.3 | 2.6 | 6,567.2 | 1,324.3 | (609.1) | (2,227.7) | 1.8 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Cash dividends (in dollars per share) | $ 0.1000 | |||||||
Beginning Balance at Dec. 31, 2019 | $ 5,094.9 | 5,092.5 | 2.6 | 6,586.7 | 1,404.2 | (599.7) | (2,301.3) | 2.4 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net (loss) income | (139.9) | (139.9) | (139.9) | |||||
Other comprehensive (loss) income | (112.2) | (112.5) | (112.5) | 0.3 | ||||
Exercise of stock options | 3.8 | 3.8 | (0.5) | 4.3 | ||||
Stock based compensation expense | 9.4 | 9.4 | 9.4 | |||||
Funding of employee stock purchase plan | 2.1 | 2.1 | 0.8 | 1.3 | ||||
Treasury shares purchased | (140) | (140) | (28) | (112) | ||||
Restricted stock unit distributions | (6.1) | (6.1) | (14.8) | 8.7 | ||||
Restricted stock unit dividends | 0 | 0.3 | (0.3) | |||||
Cash dividends | (21.8) | (21.8) | (21.8) | |||||
Ending Balance at Mar. 31, 2020 | $ 4,690.2 | 4,687.5 | 2.6 | 6,553.9 | 1,242.2 | (712.2) | (2,399) | 2.7 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Cash dividends (in dollars per share) | $ 0.1000 | |||||||
Beginning Balance at Dec. 31, 2019 | $ 5,094.9 | 5,092.5 | 2.6 | 6,586.7 | 1,404.2 | (599.7) | (2,301.3) | 2.4 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net (loss) income | (181.6) | |||||||
Other comprehensive (loss) income | 22.5 | 22.1 | ||||||
Ending Balance at Sep. 30, 2020 | 4,762.3 | 4,760.5 | 2.6 | 6,592.4 | 1,156.2 | (577.6) | (2,413.1) | 1.8 |
Beginning Balance at Mar. 31, 2020 | 4,690.2 | 4,687.5 | 2.6 | 6,553.9 | 1,242.2 | (712.2) | (2,399) | 2.7 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net (loss) income | (95.9) | (95.4) | (95.4) | (0.5) | ||||
Other comprehensive (loss) income | 67.6 | 67.5 | 67.5 | 0.1 | ||||
Exercise of stock options | 1.6 | 1.6 | 0.3 | 1.3 | ||||
Stock based compensation expense | 10.3 | 10.3 | 10.3 | |||||
Treasury shares purchased | 0 | 0 | 28 | (28) | ||||
Restricted stock unit distributions | (6.5) | (6.5) | (16) | 9.5 | ||||
Restricted stock unit dividends | 0.2 | (0.2) | ||||||
Cash dividends | (21.9) | (21.9) | (21.9) | |||||
Ending Balance at Jun. 30, 2020 | $ 4,645.4 | 4,643.1 | 2.6 | 6,576.7 | 1,124.7 | (644.7) | (2,416.2) | 2.3 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Cash dividends (in dollars per share) | $ 0.1000 | |||||||
Net (loss) income | $ 54.2 | 53.8 | 53.8 | 0.4 | ||||
Other comprehensive (loss) income | 67.1 | 67.1 | 67.1 | |||||
Acquisition of noncontrolling interest | (0.7) | 0.2 | 0.2 | (0.9) | ||||
Exercise of stock options | 0.1 | 0.1 | (0.5) | 0.6 | ||||
Stock based compensation expense | 16.5 | 16.5 | 16.5 | |||||
Funding of employee stock purchase plan | 2.6 | 2.6 | 0.9 | 1.7 | ||||
Restricted stock unit distributions | (0.8) | (0.8) | (1.6) | 0.8 | ||||
Restricted stock unit dividends | 0.2 | (0.2) | ||||||
Cash dividends | (22.1) | (22.1) | (22.1) | |||||
Ending Balance at Sep. 30, 2020 | $ 4,762.3 | $ 4,760.5 | $ 2.6 | $ 6,592.4 | $ 1,156.2 | $ (577.6) | $ (2,413.1) | $ 1.8 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Cash dividends (in dollars per share) | $ 0.1000 |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||||||
Cash dividends (in dollars per share) | $ 0.1000 | $ 0.1000 | $ 0.1000 | $ 0.1000 | $ 0.0875 | $ 0.0875 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (181,600,000) | $ 160,600,000 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation | 103,800,000 | 101,600,000 |
Amortization of intangible assets | 142,600,000 | 142,900,000 |
Amortization of deferred financing costs | 3,400,000 | 2,100,000 |
Fixed asset impairment | 2,400,000 | 33,400,000 |
Goodwill impairment | 156,600,000 | 0 |
Indefinite-lived intangible asset impairment | 38,700,000 | 5,300,000 |
Definite-lived intangible asset impairment | 0 | 3,800,000 |
Deferred income taxes | (52,700,000) | (39,900,000) |
Stock based compensation expense | 36,200,000 | 49,800,000 |
Restructuring and other costs - non-cash | 5,800,000 | 15,200,000 |
Other non-cash income | (4,700,000) | (12,400,000) |
Loss on disposal of property, plant and equipment | 700,000 | 2,900,000 |
Gain on divestiture of noncontrolling interest | 0 | (8,700,000) |
Loss on sale of non-strategic businesses and product lines | 0 | 14,000,000 |
Changes in operating assets and liabilities, net of acquisitions: | ||
Accounts and notes receivable-trade, net | 149,100,000 | (20,700,000) |
Inventories, net | 73,800,000 | (48,400,000) |
Prepaid expenses and other current assets | 50,200,000 | (3,600,000) |
Other noncurrent assets | 8,000,000 | (14,400,000) |
Accounts payable | (64,700,000) | (30,500,000) |
Accrued liabilities | (72,600,000) | (35,500,000) |
Income taxes | (9,900,000) | 11,400,000 |
Other noncurrent liabilities | (13,600,000) | 4,600,000 |
Net cash provided by operating activities | 371,500,000 | 333,500,000 |
Cash flows from investing activities: | ||
Capital expenditures | (60,000,000) | (86,900,000) |
Cash paid for acquisitions of businesses and equity investments, net of cash acquired | (2,000,000) | (3,300,000) |
Cash received on sale of non-strategic businesses or product lines | 0 | 11,600,000 |
Cash received on derivative contracts | 57,800,000 | 34,500,000 |
Cash paid on derivative contracts | (900,000) | 0 |
Liquidation of short term investments | 0 | 100,000 |
Proceeds from sale of property, plant and equipment, net | 700,000 | 4,300,000 |
Net cash used in investing activities | (4,400,000) | (39,700,000) |
Cash flows from financing activities: | ||
Repayments on short-term borrowings | (1,200,000) | (67,400,000) |
Cash paid for treasury stock | (140,000,000) | (160,000,000) |
Cash dividends paid | (65,900,000) | (58,700,000) |
Cash paid for acquisition of noncontrolling interest of consolidated subsidiary | (2,300,000) | 0 |
Proceeds from long-term borrowings | 1,448,500,000 | 119,600,000 |
Repayments of long-term borrowings | (701,000,000) | (251,200,000) |
Deferred financing costs | (6,300,000) | (700,000) |
Proceeds from exercised stock options | 6,000,000 | 78,800,000 |
Cash paid for contingent consideration on prior acquisitions | (3,000,000) | (30,700,000) |
Cash paid on derivative contracts | (30,500,000) | 0 |
Net cash provided by (used in) financing activities | 504,300,000 | (370,300,000) |
Effect of exchange rate changes on cash and cash equivalents | (4,300,000) | (7,000,000) |
Net increase (decrease) in cash and cash equivalents | 867,100,000 | (83,500,000) |
Cash and cash equivalents at beginning of period | 404,900,000 | 309,600,000 |
Cash and cash equivalents at end of period | $ 1,272,000,000 | $ 226,100,000 |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and the rules of the U.S. Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of the results for interim periods have been included. Results for interim periods should not be considered indicative of results for a full year. These financial statements and related notes contain the accounts of DENTSPLY SIRONA Inc. and subsidiaries (“Dentsply Sirona” or the “Company”) on a consolidated basis and should be read in conjunction with the consolidated financial statements and notes included in the Company’s most recent Form 10-K for the year ended December 31, 2019. The accounting policies of the Company, as applied in the interim consolidated financial statements presented herein, are substantially the same as presented in the Company’s Form 10-K for the year ended December 31, 2019, except as may be indicated below. Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of 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, and such differences may be material to the consolidated financial statements. For the nine months ended September 30, 2020, the Company made certain estimates and assumptions related to the financial statements. Some of these estimates and assumptions were based on the impacts of the COVID-19 pandemic as they were known as of the date of the filing of this Form 10-Q and there may be changes to those estimates in future periods. Actual results may differ from these estimates. As of the date of issuance of these consolidated financial statements, the full extent to which the COVID-19 pandemic will directly or indirectly have a negative material impact on the Company's financial condition, liquidity, or results of operations, is highly uncertain and difficult to predict. More specifically, the demand for the Company's products has been, and continues to be, affected by social distancing guidelines, newly implemented dental practice safety protocols which reduce patient traffic, and patient reluctance to seek dental care. At this time, it is uncertain how long these impacts will continue. The impact of the stay-at-home orders and limits to essential-only dental procedures affected demand for the Company's products in March and April, but the Company began to see improvements in May and June as some of these orders were lifted. This improvement has continued into third quarter. Furthermore, economies and, to a lesser extent, capital markets worldwide have also been negatively impacted by the continuing COVID-19 pandemic, and it is possible that it could prolong or deepen the United States' and/or global economic recession. Such economic disruption has had, and could continue to have, a significant negative effect on the Company's business. Governmental authorities around the world have responded with fiscal policy actions to support economies as a whole. The magnitude and overall effectiveness of these actions remain uncertain. During the first nine months of 2020, the Company's business was impacted by COVID-19. The impact began in the early part of the first quarter as the Company began to experience declines in customer demand in Asia and then further in mid-March where it was most pronounced in Europe and where the Company experienced partial or country-wide business lockdowns in various markets, including China, France, and Italy. The United States was most impacted in April and May. Most regions throughout the world continue to experience localized surges of COVID-19 cases which are being responded to by governmental authorities with partial lockdowns. While the duration and severity of this continuing p andemic is uncertain, the Company currently expects that its results of operations will have a negative material impact for the remainder of 2020 and potentially beyond. As a result of the economic uncertainties caused by the COVID-19 pandemic, the Company implemented several measures to improve liquidity and operating results, including reduction of hours and salaries, furloughs, suspended hiring, travel bans, delaying some of its planned capital expenditures, and deferring other discretionary spending for 2020. Some of these measures are being lifted as demand for the Company's products begins to improve. The Company will continue to reassess the reduction in work hours and furloughs as demand for products increases. The Company continues to monitor the COVID-19 pandemic and may need to reduce capacity in the event of a resurgence of COVID-19 or in the event of actions from governmental authorities to combat a resurgence. The Company believes it will be able to generate sufficient liquidity to satisfy its obligations and remain in compliance with the Company's existing debt covenants for the next twelve months. Specifically, at September 30, 2020, the Company had $1,272.0 million of cash and has access to a $700.0 million revolving credit facility as well as other short-term credit facilities of approximately $400.0 million entered into during the three months ended June 30, 2020. For further details on these credit facilities, see Note 11, Financing Arrangements. At September 30, 2020, the Company is in compliance with all of its debt covenants. The Company expects to remain in compliance with all covenants for the next twelve months, which includes an operating income excluding depreciation and amortization to interest expense of not less than 3.0 times on a trailing twelve months basis. If recovery from the pandemic takes longer than currently estimated by the Company, the Company may need to seek covenant waivers in the future. The Company's failure to obtain debt covenant waivers could trigger a violation of these covenants and lead to default and acceleration of all of its outstanding debt, which could have a material adverse effect on liquidity. Revenue Recognition At September 30, 2020, the Company had $28.4 million of deferred revenue recorded in Accrued liabilities in the Consolidated Balance Sheets. The Company expects to recognize significantly all of the deferred revenue within the next 12 months. Accounts and Notes Receivable The Company records a provision for doubtful accounts, which is included in Selling, general, and administrative expenses in the Consolidated Statements of Operations. Accounts and notes receivables – trade, net are stated net of allowances for doubtful accounts and trade discounts, which were $31.1 million at September 30, 2020 and $29.4 million at December 31, 2019. Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (" FASB") i ssued Accounting Standards Update ( "ASU") No. 2016-13 "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." This newly issued accounting standard changes the recognition and measurement of credit losses, including trade accounts receivable. Under current accounting standards, a loss is recognized when such loss becomes probable of occurring. The new standard broadens the information that an entity must consider when developing expected credit loss estimates. The Company adopted this accounting standard on January 1, 2020. The adoption of this standard did not materially impact the Company's financial position, results of operations, cash flows, disclosures, or internal controls. In August 2018, the FASB issued ASU No. 2018-14 "Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans." This newly issued accounting standard changes disclosure requirements for defined benefit plans, including removal and modification of existing disclosures. The amendments in this standard are required for fiscal years ending after December 15, 2020. The amendments should be applied on a retrospective basis for all periods presented. The Company adopted this accounting standard on January 1, 2020. The adoption of this standard did not materially impact the Company's disclosures. In December 2019, the FASB issued ASU No. 2019-12 "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes." This newly issued accounting standard simplifies key provisions for accounting for income taxes, as part of the FASB's initiative to reduce complexity in accounting standards. The amendments eliminate certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences. The amendments also clarify and simplify other aspects of the accounting for income taxes. The amendments in this update are effective for interim and fiscal periods beginning after December 31, 2020. The Company adopted this accounting standard on January 1, 2020. The adoption of this standard did not materially impact the Company's financial position, results of operations, cash flows, disclosures, or internal controls. Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU No. 2020-04 "Reference Rate Reform (Topic 828): Facilitation of the Effects of Reference Rate Reform on Financial Reporting." This newly issued accounting standard provides guidance on whether the change in reference rate is a modification versus an extinguishment of a contract. Specifically, there is risk of cessation of the London Interbank Offer Rate ("LIBOR"). The Company has certain variable interest rate debt that use LIBOR as a reference rate. The guidance provided by this accounting standard may be used for contracts entered into on or before December 31, 2022 on a prospective basis. The Company is currently assessing the impact that this standard will have on its financial position, results of operations, cash flows, and disclosures. |
STOCK COMPENSATION
STOCK COMPENSATION | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
STOCK COMPENSATION | STOCK COMPENSATION Total stock based compensation expense for non-qualified stock options, restricted stock units ("RSU"), and the tax related benefit for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Stock option expense $ 1.6 $ 0.6 $ 5.1 $ 5.6 RSU expense 14.7 14.6 30.3 43.4 Total stock based compensation expense $ 16.3 $ 15.2 $ 35.4 $ 49.0 Related deferred income tax benefit $ 1.6 $ 1.8 $ 3.7 $ 6.8 For the three and nine months ended September 30, 2020, stock compensation expense was $16.3 million and $35.4 million, respectively, of which $16.1 million and $34.6 million, respectively, was recorded in Selling, general, and administrative expense, and $0.2 million and $0.8 million, respectively, was recorded in Cost of products sold in the Consolidated Statements of Operations. For the three and nine months ended September 30, 2019, stock compensation expense was $15.2 million and $49.0 million, respectively, of which $14.7 million and $47.5 million, respectively, was recorded in Selling, general, and administrative expense, and $0.5 million and $1.5 million, respectively, was recorded in Cost of products sold in the Consolidated Statements of Operations. |
COMPREHENSIVE INCOME (LOSS)
COMPREHENSIVE INCOME (LOSS) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
COMPREHENSIVE INCOME (LOSS) | COMPREHENSIVE INCOME (LOSS) Components of Other comprehensive income (loss), net of tax, for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Foreign currency translation gains (losses) $ 107.1 $ (147.2) $ 67.6 $ (164.2) Foreign currency translation (losses) gains on hedges of net investments (22.3) 19.7 (28.0) 19.1 These amounts are recorded in Accumulated other comprehensive income (loss) ("AOCI"), net of any related tax adjustments. At September 30, 2020 and December 31, 2019, the cumulative tax adjustments were $189.5 million and $173.0 million, respectively, primarily related to foreign currency translation gains and losses. The cumulative foreign currency translation adjustments included translation losses of $192.6 million and $260.2 million at September 30, 2020 and December 31, 2019, respectively, and cumulative losses on loans designated as hedges of net investments of $136.1 million and $108.1 million, respectively. These foreign currency translation losses were partially offset by movements on derivative financial instruments. Changes in AOCI, net of tax, by component for the nine months ended September 30, 2020 and 2019 were as follows: (in millions) Foreign Currency Translation Gain (Loss) Gain (Loss) on Cash Flow Hedges Gain (Loss) on Net Investment Hedges Pension Liability Gain (Loss) Total Balance, net of tax, at December 31, 2019 $ (368.3) $ (10.6) $ (100.7) $ (120.1) $ (599.7) Other comprehensive income (loss) before reclassifications and tax impact 26.3 (18.8) (7.0) — 0.5 Tax benefit 13.3 2.4 0.8 — 16.5 Other comprehensive income (loss), net of tax, before reclassifications 39.6 (16.4) (6.2) — 17.0 Amounts reclassified from accumulated other comprehensive income, net of tax — 0.4 — 4.7 5.1 Net increase (decrease) in other comprehensive loss 39.6 (16.0) (6.2) 4.7 22.1 Balance, net of tax, at September 30, 2020 $ (328.7) $ (26.6) $ (106.9) $ (115.4) $ (577.6) (in millions) Foreign Currency Translation Gain (Loss) Gain (Loss) on Cash Flow Hedges Gain (Loss) on Net Investment Hedges Pension Liability Gain (Loss) Total Balance, net of tax, at December 31, 2018 $ (284.7) $ 0.6 $ (111.4) $ (83.2) $ (478.7) Other comprehensive (loss) income before reclassifications and tax impact (134.0) (18.6) 31.7 — (120.9) Tax (expense) benefit (11.1) 4.5 (7.0) — (13.6) Other comprehensive (loss) income, net of tax, before reclassifications (145.1) (14.1) 24.7 — (134.5) Amounts reclassified from accumulated other comprehensive income, net of tax — 1.4 — 2.7 4.1 Net (decrease) increase in other comprehensive loss (145.1) (12.7) 24.7 2.7 (130.4) Balance, net of tax, at September 30, 2019 $ (429.8) $ (12.1) $ (86.7) $ (80.5) $ (609.1) |
EARNINGS PER COMMON SHARE
EARNINGS PER COMMON SHARE | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
EARNINGS PER COMMON SHARE | EARNINGS PER COMMON SHARE The computation of basic and diluted earnings per common share for the three and nine months ended September 30, 2020 and 2019 were as follows: Basic Earnings Per Common Share Computation Three Months Ended Nine Months Ended (in millions, except per share amounts) 2020 2019 2020 2019 Net income (loss) attributable to Dentsply Sirona $ 53.8 $ 85.0 $ (181.5) $ 160.6 Weighted average common shares outstanding 218.5 223.1 219.4 223.5 Earnings (loss) per common share - basic $ 0.25 $ 0.38 $ (0.83) $ 0.72 Diluted Earnings Per Common Share Computation Three Months Ended Nine Months Ended (in millions, except per share amounts) 2020 2019 2020 2019 Net income (loss) attributable to Dentsply Sirona $ 53.8 $ 85.0 $ (181.5) $ 160.6 Weighted average common shares outstanding 218.5 223.1 219.4 223.5 Incremental weighted average shares from assumed exercise of dilutive options from stock-based compensation awards 0.7 1.8 — 1.7 Total weighted average diluted shares outstanding 219.2 224.9 219.4 225.2 Earnings (loss) per common share - diluted $ 0.25 $ 0.38 $ (0.83) $ 0.71 The calculation of weighted average diluted common shares outstanding excluded 0.9 million of potentially dilutive common shares because the Company reported a net loss for the nine months ended September 30, 2020. Stock options and RSUs of 3.5 million and 3.2 million equivalent shares of common stock that were outstanding during the three and nine months ended September 30, 2020, respectively, were excluded because their effect would be antidilutive. There were 2.5 million and 3.4 million antidilutive equivalent shares of common stock outstanding during the three and nine months ended September 30, 2019, respectively. On March 9, 2020, the Company entered into an accelerated share repurchase agreement with a financial institution pursuant to an Accelerated Share Repurchase Transaction (“ASR Agreement") to purchase $140.0 million of the Company's common stock. Pursuant to the terms of the ASR Agreement, the Company delivered $140.0 million cash to a financial institution and received an initial delivery of 2.7 million shares of the Company’s common stock on March 9, 2020 based on a closing market price of $42.12 per share and the applicable contractual discount. The Company received the remaining 1.0 million shares on May 12, 2020. The average price per share for the total shares purchased under the ASR Agreement was $38.88 per share. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION The Company has numerous operating businesses covering a wide range of dental consumable products, dental technology, and dental equipment products primarily serving the professional dental market, and certain healthcare products. Professional dental products represented approximately 91% and 89%, of net sales for the three and nine months ended September 30, 2020, respectively, and 92% for the three and nine months ended September 30, 2019. The operating businesses are combined into two operating groups, which generally have overlapping geographical presence, customer bases, distribution channels, and regulatory oversight. These operating groups are considered the Company’s reportable segments as the Company’s chief operating decision-maker regularly reviews financial results at the operating group level and uses this information to manage the Company’s operations. The Company evaluates performance of the segments based on the groups’ net sales and segment adjusted operating income. The Company also evaluates segment performance based on each segment’s adjusted operating income before provision for income taxes and interest. Segment adjusted operating income is defined as operating income before income taxes and before certain corporate headquarters unallocated costs, restructuring and other costs, interest expense, interest income, other expense (income), net, amortization of intangible assets, and depreciation resulting from the fair value step-up of property, plant, and equipment from acquisitions. The Company’s segment adjusted operating income is considered a Non-GAAP measure. A description of the products and services provided within each of the Company’s two operating segments is provided below. Technologies & Equipment This segment is responsible for the worldwide design, manufacture, sales, and distribution of the Company’s Dental Technology and Equipment Products and Healthcare Consumable Products. These products include dental implants, CAD/CAM systems, orthodontic clear aligners, imaging systems, treatment centers, instruments, as well as consumable medical device products. Consumables This segment is responsible for the worldwide design, manufacture, sales, and distribution of the Company’s Dental Consumable Products which include preventive, restorative, endodontic, and laboratory dental products. The Company’s segment information for the three and nine months ended September 30, 2020 and 2019 was as follows: Net Sales Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Technologies & Equipment $ 503.8 $ 534.5 $ 1,328.0 $ 1,613.7 Consumables 391.0 427.6 931.7 1,304.0 Total net sales $ 894.8 $ 962.1 $ 2,259.7 $ 2,917.7 Segment Adjusted Operating Income Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Technologies & Equipment $ 109.6 $ 104.7 $ 216.9 $ 272.5 Consumables 99.1 113.8 143.1 341.3 Segment adjusted operating income 208.7 218.5 360.0 613.8 Reconciling items expense (income): All other (a) 57.9 54.7 141.1 173.3 Goodwill impairment — — 156.6 — Restructuring and other costs 18.7 5.2 62.5 68.1 Interest expense 14.5 6.6 33.5 23.0 Interest income (0.4) (0.7) (1.8) (2.0) Other expense (income), net 0.9 (2.9) 3.8 (4.6) Amortization of intangible assets 48.8 47.4 142.6 142.9 Depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations 1.6 1.7 4.6 5.2 Income (loss) before income taxes $ 66.7 $ 106.5 $ (182.9) $ 207.9 (a) Includes the results of unassigned Corporate headquarters costs and inter-segment eliminations. |
INVENTORIES
INVENTORIES | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories are stated at the lower of cost and net realizable value. The cost of inventories determined by the last-in, first-out (“LIFO”) method at September 30, 2020 and December 31, 2019 were $5.9 million and $5.0 million, respectively. The cost of remaining inventories were determined by the first-in, first-out (“FIFO”) or average cost methods. If the FIFO method had been used to determine the cost of LIFO inventories, the amounts at which net inventories are stated would be higher than reported at September 30, 2020 and December 31, 2019 by $20.4 million and $14.3 million, respectively. Inventories, net were as follows: (in millions) September 30, 2020 December 31, 2019 Finished goods $ 282.0 $ 356.4 Work-in-process 75.0 82.5 Raw materials and supplies 132.1 122.8 Inventories, net $ 489.1 $ 561.7 The inventory reserve was $125.6 million and $85.0 million at September 30, 2020 and December 31, 2019, respectively. The increase in the inventory reserve is primarily related to charges made under the current quarter restructuring plans and slow moving inventory as a result of lower customer demand, some of which was due to the COVID-19 pandemic. |
RESTRUCTURING AND OTHER COSTS
RESTRUCTURING AND OTHER COSTS | 9 Months Ended |
Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND OTHER COSTS | RESTRUCTURING AND OTHER COSTS During the three and nine months ended September 30, 2020, the Company recorded restructuring costs of $52.3 million and $95.5 million, respectively, which consists primarily of inventory write-downs of $24.5 million and $24.6 million, respectively, accelerated depreciation of $8.4 million and $9.1 million, respectively, severance costs of $15.7 million and $20.6 million, respectively, and asset impairments of $2.2 million and $41.0 million, respectively. During the three and nine months ended September 30, 2019, the Company recorded restructuring costs of $7.3 million and $117.7 million, respectively, which consists primarily of inventory write-downs of $2.5 million and $19.5 million, respectively, severance income of $1.9 million and expense of $29.3 million, respectively, and asset impairments of $3.8 million and $41.8 million, respectively. The details of total restructuring costs for the three and nine months ended September 30 were as follows: Affected Line Item in the Consolidated Statements of Operations Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Cost of products sold $ 32.3 $ 3.6 $ 32.7 $ 24.3 Selling, general, and administrative expenses 1.3 (1.1) 0.6 20.3 Restructuring and other costs 18.7 5.2 62.5 68.1 Other income and expenses — (0.4) (0.3) 5.0 Total restructuring costs $ 52.3 $ 7.3 $ 95.5 $ 117.7 The Company announced on August 6, 2020 that it will exit its traditional orthodontics business as well as both exit and restructure certain portions of its laboratory business. The traditional orthodontics business is part of the Technologies & Equipment segment and the laboratory business is part of the Consumables segment. The Company is exiting several of its facilities and reducing its workforce by approximately 4% to 5%. The Company expects to record restructuring charges in a range of $70 million to $80 million for inventory write-downs, severance costs, fixed asset write-offs, and other facility closure costs. During the three months ended September 30, 2020, the Company recorded expenses of approximately $48 million related to these actions which consists primarily of inventory write-downs of approximately $25 million, accelerated depreciation of approximately $8 million, and severance costs of approximately $13 million. These expenses are included in the above table. The Company expects most of the remaining restructuring charges will be recorded during the fourth quarter of 2020. The Company’s restructuring accruals at September 30, 2020 were as follows: Severance (in millions) 2018 and 2019 Plans 2020 Plans Total Balance at December 31, 2019 $ 7.2 $ 19.8 $ — $ 27.0 Provisions 1.1 1.5 19.3 21.9 Amounts applied (3.2) (7.4) (1.8) (12.4) Change in estimates (0.5) (3.6) — (4.1) Balance at September 30, 2020 $ 4.6 $ 10.3 $ 17.5 $ 32.4 Lease/Contract Terminations (in millions) 2018 and 2020 Plans Total Balance at December 31, 2019 $ 0.5 $ — $ 0.5 Provisions 0.4 0.3 0.7 Amounts applied (0.4) (0.1) (0.5) Balance at September 30, 2020 $ 0.5 $ 0.2 $ 0.7 Other Restructuring Costs (in millions) 2018 and 2019 Plans 2020 Plans Total Balance at December 31, 2019 $ 2.2 $ 0.3 $ — $ 2.5 Provisions — 0.5 0.4 0.9 Amounts applied — (0.7) 0.1 (0.6) Change in estimate — (0.1) — (0.1) Balance at September 30, 2020 $ 2.2 $ — $ 0.5 $ 2.7 The cumulative amounts for the provisions and adjustments and amounts applied for all the plans by segment were as follows: (in millions) December 31, 2019 Provisions Amounts Change in Estimates September 30, 2020 Technologies & Equipment $ 19.1 $ 16.3 $ (8.0) $ (4.0) $ 23.4 Consumables 11.4 4.5 (3.9) (0.1) 11.9 All Other (0.5) 2.7 (1.6) (0.1) 0.5 Total $ 30.0 $ 23.5 $ (13.5) $ (4.2) $ 35.8 The associated restructuring liabilities are recorded in Accrued liabilities and Other noncurrent liabilities in the Consolidated Balance Sheets. |
FINANCIAL INSTRUMENTS AND DERIV
FINANCIAL INSTRUMENTS AND DERIVATIVES | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
FINANCIAL INSTRUMENTS AND DERIVATIVES | FINANCIAL INSTRUMENTS AND DERIVATIVES Derivative Instruments and Hedging Activities The Company’s activities expose it to a variety of market risks, which primarily include the risks related to the effects of changes in foreign currency exchange rates and interest rates. These financial exposures are monitored and managed by the Company as part of its overall risk management program. The objective of this risk management program is to reduce the volatility that these market risks may have on the Company’s operating results and equity. The Company employs derivative financial instruments to hedge certain anticipated transactions, firm commitments, or assets and liabilities denominated in foreign currencies. Additionally, the Company has utilized interest rate swaps to convert variable rate debt to fixed rate debt. Derivative Instruments Designated as Hedging Cash Flow Hedges The following summarizes the notional amounts of cash flow hedges by derivative instrument type at September 30, 2020 and the notional amounts expected to mature during the next 12 months, with a discussion of the various cash flow hedges by derivative instrument type following the table: (in millions) Aggregate Notional Amount Aggregate Notional Amount Maturing within 12 Months Foreign exchange forward contracts $ 325.6 $ 236.9 Total derivative instruments designated as cash flow hedges $ 325.6 $ 236.9 Foreign Exchange Risk Management The Company uses a program to hedge select anticipated foreign currency cash flows to reduce volatility in both cash flows and reported earnings of the consolidated Company. The Company accounts for the designated foreign exchange forward contracts as cash flow hedges. As a result, the Company records the fair value of the contracts primarily through AOCI based on the assessed effectiveness of the foreign exchange forward contracts. The Company measures the effectiveness of cash flow hedges of anticipated transactions on a spot-to-spot basis rather than on a forward-to-forward basis. Accordingly, the spot-to-spot change in the derivative fair value will be deferred in AOCI and released and recorded in the Consolidated Statements of Operations in the same period that the hedged transaction is recorded. The time-value component of the fair value of the derivative is reported on a straight-line basis in Cost of products sold in the Consolidated Statements of Operations in the period which it is applicable. Any cash flows associated with these instruments are included in operating activities in the Consolidated Statements of Cash Flows. These foreign exchange forward contracts generally have maturities up to 18 months and the counterparties to the transactions are typically large international financial institutions. Interest Rate Risk Management The Company enters into interest rate swap contracts infrequently as they are only used to manage interest rate risk on long-term debt instruments and not for speculative purposes. Any cash flows associated with these instruments are included in operating activities in the Consolidated Statements of Cash Flows. On May 26, 2020, the Company paid $30.5 million to settle the $150.0 million notional Treasury Rate Lock contract, which partially hedged the interest rate risk of the $750.0 million senior unsecured notes. This loss will be amortized over the ten-year life of the notes. Cash Flow Hedge Activity Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Cost of products sold and Interest expense in the Company's Consolidated Statements of Operations related to all cash flow hedges for the three months ended September 30, 2020 and 2019 were insignificant. Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Cost of products sold and Interest expense in the Company's Consolidated Statements of Operations related to all cash flow hedges for the nine months ended September 30, 2020 were as follows: Nine Months Ended September 30, 2020 Gain (Loss) in AOCI Consolidated Statements of Operations Location Effective Portion Reclassified from AOCI into Income (Expense) Ineffective Portion Recognized in Income (Expense) (in millions) Effective Portion: Foreign exchange forward contracts $ (1.7) Cost of products sold $ 2.2 $ — Interest rate swaps (17.1) Interest expense (2.6) — Ineffective Portion: Foreign exchange forward contracts — Cost of products sold — 2.2 Total in cash flow hedging $ (18.8) $ (0.4) $ 2.2 Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Cost of products sold and Interest expense in the Company’s Consolidated Statements of Operations related to all cash flow hedges for the nine months ended September 30, 2019 were as follows: Nine Months Ended September 30, 2019 Gain (Loss) in AOCI Consolidated Statements of Operations Location Effective Portion Reclassified from AOCI into Income (Expense) Ineffective Portion Recognized in Income (Expense) (in millions) Effective Portion: Foreign exchange forward contracts $ (4.0) Cost of products sold $ 0.4 $ — Interest rate swaps (14.6) Interest expense (1.8) — Ineffective Portion: Foreign exchange forward contracts — Cost of products sold — 1.5 Total in cash flow hedging $ (18.6) $ (1.4) $ 1.5 For the rollforward of derivative instruments designated as cash flow hedges in AOCI see Note 3, Comprehensive Income (Loss). Hedges of Net Investments in Foreign Operations The Company has significant investments in foreign subsidiaries. The net assets of these subsidiaries are exposed to volatility in currency exchange rates. The Company employs both derivative and non-derivative financial instruments to hedge a portion of this exposure. The derivative instruments consist of foreign exchange forward contracts and cross currency basis swaps. The non-derivative instruments consist of foreign currency denominated debt held at the parent company level. Translation gains and losses related to the net assets of the foreign subsidiaries are offset by gains and losses in derivative and non-derivative financial instruments; which are designated as hedges of net investments and are included in AOCI. The time-value component of the fair value of the derivative is reported on a straight-line basis in Other expense (income), net in the Consolidated Statements of Operations in the applicable period. Any cash flows associated with these instruments are included in investing activities in the Consolidated Statements of Cash Flows except for derivative instruments that include an other-than-insignificant financing element, for which all cash flows are classified as financing activities in the Consolidated Statements of Cash Flows. The notional amount of hedges of net investments by derivative instrument type at September 30, 2020 and the notional amounts expected to mature during the next 12 months were as follows: (in millions) Aggregate Aggregate Notional Amount Maturing within 12 Months Cross currency basis swaps $ 308.6 $ 308.6 Total for instruments designated as hedges of net investment $ 308.6 $ 308.6 The fair value of the foreign exchange forward contracts and cross currency basis swaps is the estimated amount the Company would receive or pay at the reporting date, taking into account the effective interest rates, cross currency swap basis rates, and foreign exchange rates. The effective portion of the change in the value of these derivatives is recorded in AOCI, net of tax effects. Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Interest expense and Other expense (income), net in the Company’s Consolidated Statements of Operations related to the hedges of net investments for the three months ended September 30, 2020 and 2019 were as follows: Three Months Ended September 30, 2020 Gain (Loss) in AOCI Consolidated Statements of Operations Location Recognized in Income (Expense) (in millions) Effective Portion: Cross currency basis swaps $ (16.8) Interest expense $ 2.0 Total for net investment hedging $ (16.8) $ 2.0 Three Months Ended September 30, 2019 (in millions) Gain (Loss) in AOCI Consolidated Statements of Operations Locations Recognized in Income (Expense) Effective Portion: Cross currency basis swaps $ 12.4 Interest expense $ 2.2 Foreign exchange forward contracts 25.5 Other expense (income), net 6.1 Total for net investment hedging $ 37.9 $ 8.3 Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Interest expense and Other expense (income), net in the Company's Consolidated Statements of Operations related to the hedges of net investments for the nine months ended September 30, 2020 and 2019 were as follows: Nine Months Ended September 30, 2020 Gain (Loss) in AOCI Consolidated Statements of Operations Location Recognized in Income (Expense) (in millions) Effective Portion: Cross currency basis swaps $ (13.4) Interest expense $ 6.4 Foreign exchange forward contracts 6.4 Other expense (income), net 6.2 Total for net investment hedging $ (7.0) $ 12.6 Nine Months Ended September 30, 2019 (in millions) Gain (Loss) in AOCI Consolidated Statements of Operations Location Recognized in Income (Expense) Effective Portion: Cross currency basis swaps $ 13.1 Interest expense $ 6.3 Foreign exchange forward contracts 31.7 Other expense (income), net 15.7 Total for net investment hedging $ 44.8 $ 22.0 On April 7, 2020, the Company terminated its entire foreign exchange forward contracts net investment hedge portfolio early which resulted in a $48.1 million cash receipt. The Company elected to enter into this transaction to convert the favorable gain position into additional liquidity. Fair Value Hedges Foreign Exchange Risk Management The Company has an intercompany loan denominated in Swedish kronor that is exposed to volatility in currency exchange rates. The Company employs derivative financial instruments to hedge this exposure. The Company accounts for these designated foreign exchange forward contracts as fair value hedges. The Company measures the effectiveness of fair value hedges of anticipated transactions on a spot-to-spot basis rather than on a forward-to-forward basis. Accordingly, the spot-to-spot change in the derivative fair value will be recorded in the Consolidated Statements of Operations. Any cash flows associated with these instruments are included in investing activities in the Consolidated Statements of Cash Flows. The notional amounts of fair value hedges by derivative instrument type at September 30, 2020 and the notional amounts expected to mature during the next 12 months were as follows: (in millions) Aggregate Aggregate Notional Amount Maturing within 12 Months Foreign exchange forward contracts $ 98.3 $ 70.2 Total derivative instruments as fair value hedges $ 98.3 $ 70.2 Gains and losses recorded in AOCI in the Consolidated Balance Sheets and Other expense (income), net in the Company's Consolidated Statements of Operations related to the fair value hedges for the three and nine months ended September 30, 2020 and 2019 were insignificant. Derivative Instruments Not Designated as Hedges The Company enters into derivative instruments with the intent to partially mitigate the foreign exchange revaluation risk associated with recorded assets and liabilities that are denominated in a non-functional currency. The Company primarily uses foreign exchange forward contracts to hedge these risks. The gains and losses on these derivative transactions offset the gains and losses generated by the revaluation of the underlying non-functional currency balances and are recorded in Other expense (income), net in the Consolidated Statements of Operations. Any cash flows associated with the foreign exchange forward contracts and interest rate swaps not designated as hedges are included in cash from operating activities in the Consolidated Statements of Cash Flows. The aggregate notional amounts of the Company’s economic hedges not designated as hedges by derivative instrument types at September 30, 2020 and the notional amounts expected to mature during the next 12 months were as follows: (in millions) Aggregate Aggregate Notional Amount Maturing within 12 Months Foreign exchange forward contracts $ 226.2 $ 226.2 Total for instruments not designated as hedges $ 226.2 $ 226.2 Gains and losses recorded in the Company’s Consolidated Statements of Operations related to the economic hedges not designated as hedges for the three and nine months ended September 30, 2020 and 2019 were insignificant. Consolidated Balance Sheets Location of Derivative Fair Values The fair value of the Company's derivatives in the Consolidated Balance Sheets at September 30, 2020 was insignificant. The fair value and the location of the Company's derivatives in the Consolidated Balance Sheets at December 31, 2019 were as follows: December 31, 2019 (in millions) Prepaid Expenses and Other Current Assets Other Noncurrent Assets Accrued Liabilities Other Noncurrent Liabilities Designated as Hedges: Foreign exchange forward contracts $ 26.9 $ 11.3 $ 1.3 $ 1.8 Interest rate swaps — — — 10.8 Cross currency basis swaps — 6.9 — — Total $ 26.9 $ 18.2 $ 1.3 $ 12.6 Not Designated as Hedges: Foreign exchange forward contracts $ 2.0 $ — $ 1.5 $ — Total $ 2.0 $ — $ 1.5 $ — Balance Sheet Offsetting Substantially all of the Company’s derivative contracts are subject to netting arrangements; whereby the right to offset occurs in the event of default or termination in accordance with the terms of the arrangements with the counterparty. While these contracts contain the enforceable right to offset through netting arrangements with the same counterparty, the Company elects to present them on a gross basis in the Consolidated Balance Sheets. Offsetting of financial assets and liabilities under netting arrangements at September 30, 2020 were as follows: Gross Amounts Not Offset in the Consolidated Balance Sheets (in millions) Gross Amounts Recognized Gross Amount Offset in the Consolidated Balance Sheets Net Amounts Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received/Pledged Net Amount Assets Foreign exchange forward contracts $ 4.3 $ — $ 4.3 $ (2.5) $ — $ 1.8 Total assets $ 4.3 $ — $ 4.3 $ (2.5) $ — $ 1.8 Liabilities Foreign exchange forward contracts $ 4.4 $ — $ 4.4 $ — $ — $ 4.4 Cross currency basis swaps 6.5 — 6.5 (2.5) — 4.0 Total liabilities $ 10.9 $ — $ 10.9 $ (2.5) $ — $ 8.4 Offsetting of financial assets and liabilities under netting arrangements at December 31, 2019 were as follows: Gross Amounts Not Offset in the Consolidated Balance Sheets (in millions) Gross Amounts Recognized Gross Amount Offset in the Consolidated Balance Sheets Net Amounts Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received/Pledged Net Amount Assets Foreign exchange forward contracts $ 38.8 $ — $ 38.8 $ (7.8) $ — $ 31.0 Cross currency basis swaps 6.9 — 6.9 (0.9) — 6.0 Total assets $ 45.7 $ — $ 45.7 $ (8.7) $ — $ 37.0 Liabilities Foreign exchange forward contracts $ 3.2 $ — $ 3.2 $ (3.0) $ — $ 0.2 Interest rate swaps 10.8 — 10.8 (5.7) — 5.1 Total liabilities $ 14.0 $ — $ 14.0 $ (8.7) $ — $ 5.3 |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENT | FAIR VALUE MEASUREMENT Assets and Liabilities Measured at Fair Value on a Recurring Basis The Company estimates the fair value of total long term debt, including current portion, using Level 1 inputs. At September 30, 2020, the Company estimated the fair value and carrying value of this debt were $2,298.5 million and $2,226.1 million, respectively. At December 31, 2019, the Company estimated the fair value and carrying value of this debt were $1,440.8 million and $1,433.3 million, respectively. The Company’s financial assets and liabilities set forth by level within the fair value hierarchy that were accounted for at fair value on a recurring basis were as follows: September 30, 2020 (in millions) Total Level 1 Level 2 Level 3 Assets Foreign exchange forward contracts $ 4.3 $ — $ 4.3 $ — Total assets $ 4.3 $ — $ 4.3 $ — Liabilities Cross currency basis swaps $ 6.5 $ — $ 6.5 $ — Foreign exchange forward contracts 4.3 — 4.3 — Contingent considerations on acquisitions 5.7 — — 5.7 Total liabilities $ 16.5 $ — $ 10.8 $ 5.7 December 31, 2019 (in millions) Total Level 1 Level 2 Level 3 Assets Cross currency basis swaps $ 6.9 $ — $ 6.9 $ — Foreign exchange forward contracts 40.2 — 40.2 — Total assets $ 47.1 $ — $ 47.1 $ — Liabilities Interest rate swaps $ 10.8 $ — $ 10.8 $ — Foreign exchange forward contracts 4.6 — 4.6 — Contingent considerations on acquisitions 8.7 — — 8.7 Total liabilities $ 24.1 $ — $ 15.4 $ 8.7 There have been no transfers between levels during the nine months ended September 30, 2020. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES Uncertainties in Income Taxes The Company recognizes the impact of a tax position in the interim consolidated financial statements if that position is more likely than not of being sustained on audit based on the technical merits of the position. It is reasonably possible that certain amounts of unrecognized tax benefits will significantly increase or decrease within 12 months of the reporting date of the Company’s quarterly consolidated financial statements. Final settlement and resolution of outstanding tax matters in various jurisdictions during the next 12 months are not expected to be significant. Other Tax Matters During the three months ended September 30, 2020, the Company recorded $1.8 million of tax expense for discrete tax matters. |
FINANCING ARRANGEMENTS
FINANCING ARRANGEMENTS | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
FINANCING ARRANGEMENTS | FINANCING ARRANGEMENTS At September 30, 2020, the Company had $1,161.1 million of borrowing available under lines of credit, including lines available under its short-term arrangements and revolving credit facility. Through the date of the filing of this Form 10-Q, the Company has no outstanding borrowings under any of these credit agreements. In response to the COVID-19 pandemic, the Company took the following actions during the nine months ended September 30, 2020 to strengthen its liquidity and financial flexibility: • On April 9, 2020, the Company entered into a $310.0 million 364-day revolving credit facility with a maturity date of April 8, 2021. The 364-day revolving credit facility mirrors the original five-year facility in all major respects, is unsecured, and contains certain affirmative and negative covenants relating to the operations and financial condition of the Company. • On April 17, 2020, the Company provided a notice to the administrative agent to draw down the full available amount under the 2018 revolving credit facility, which is equal to $700.0 million. The Company had previously not drawn down any sums under this facility. The borrowings incurred interest at the rate of adjusted LIBOR plus 1.25%. The Company subsequently repaid the $700.0 million revolver borrowing on May 26, 2020. • On May 26, 2020, the Company issued $750.0 million of senior unsecured notes with a final maturity date of June 1, 2030 at a semi-annual coupon rate of 3.25%. The net proceeds were $748.4 million, net of discount of $1.6 million. Issuance fees totaled $6.4 million. The Company paid $30.5 million to settle the $150.0 million notional T-Lock contract which partially hedged the interest rate risk of the note issuance. This cost will be amortized over the ten-year life of the notes. The proceeds were used to repay the $700.0 million revolver borrowing and the remaining proceeds will be used for working capital and other general corporate purposes. • Various other credit facilities: ◦ On May 5, 2020, the Company entered into a 40.0 million euro 364-day revolving credit facility with a maturity date of April 30, 2021. ◦ On May 12, 2020 the Company entered into a 30.0 million euro 364-day revolving credit facility with a maturity date of May 6, 2021. ◦ On June 11, 2020, the Company entered into a 3.3 billion Japanese yen 364-day revolving credit facility with a maturity date of June 11, 2021. These agreements are unsecured and contain certain affirmative and negative covenants relating to the operations and financial condition of the Company. The Company has a $500.0 million commercial paper program. The $700.0 million multi-currency revolving credit facility serves as a back-stop credit facility for the Company's commercial paper program. At September 30, 2020 and December 31, 2019, there were no outstanding borrowings under the commercial paper program. The Company’s revolving credit facilities and senior unsecured notes contain certain affirmative and negative debt covenants relating to the Company's operations and financial condition. At September 30, 2020, the Company was in compliance with all affirmative and negative debt covenants. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS 2020 Annual Goodwill Impairment Testing The Company performed the required annual impairment tests of goodwill at April 30, 2020 on its five reporting units. To determine the fair value of these reporting units, the Company uses a discounted cash flow model with market-based support as its valuation technique to measure the fair value for its reporting units. The discounted cash flow model uses five-to-ten-year forecasted cash flows plus a terminal value based on a multiple of earnings or by capitalizing the last period’s cash flows using a perpetual growth rate. The Company's significant assumptions in the discounted cash flow models include, but are not limited to: the weighted average cost of capital, revenue growth rates, including perpetual revenue growth rates, and operating margin percentages of the reporting unit's business. The Company considered the current market conditions when determining its assumptions. The total forecasted cash flows were discounted based on a range between 9.0% to 11.5%, which included assumptions regarding the Company’s weighted average cost of capital ("WACC"). Lastly, the Company reconciled the aggregate fair values of its reporting units to its market capitalization, which included a reasonable control premium based on market conditions. These future expectations include, but are not limited to, the current and ongoing impact of the COVID-19 pandemic and new product development changes for these reporting units. The Company also considers the current and projected market and economic conditions amid the ongoing pandemic for the dental industry both in the U.S. and globally, when determining its assumptions. The use of estimates and the development of assumptions results in uncertainties around forecasted cash flows. As a result of the annual tests of goodwill, no impairment was identified. For the Company's goodwill that was not impaired at March 31, 2020 (see March 31, 2020 Impairment Testing below), the Company applied a hypothetical sensitivity analysis to its reporting units. If the WACC rate of these reporting units had been hypothetically increased by 100 basis points at April 30, 2020, one reporting unit within the Company's Technologies & Equipment segment would have a fair value that would approximate book value. If the fair value of each of these reporting units had been hypothetically reduced by 10% at April 30, 2020, one reporting unit within the Company's Technologies & Equipment segment would have a fair value that approximates net book value. Goodwill for this reporting unit totals $1.2 billion at September 30, 2020. For the Equipment & Instruments reporting unit that recorded goodwill impairment at March 31, 2020, the implied fair value continues to approximate net book value at April 30, 2020. Goodwill for this reporting unit totals $291.5 million at September 30, 2020. A change in any of these estimates and assumptions used in the annual test, as well as unfavorable changes in the ongoing COVID-19 pandemic, a degradation in the overall markets served by these reporting units, among other factors, could have a negative material impact to the fair value of the reporting units and could result in a future impairment charge. There can be no assurance that the Company’s future goodwill impairment testing will not result in a charge to earnings. This impairment charge could have a negative material impact on the Company’s results of operations. 2020 Annual Indefinite-Lived Intangibles Impairment Testing The Company also assessed the annual impairment of indefinite-lived intangible assets at April 30, 2020, which largely consists of acquired tradenames and trademarks, in conjunction with the annual impairment tests of goodwill. As a result of the annual impairment test of indefinite-lived intangible assets, no impairment was identified. For the Company's indefinite-lived intangible assets that were not impaired at March 31, 2020 (see March 31, 2020 Impairment Testing below), the Company applied a hypothetical sensitivity analysis. If the fair value of each of these indefinite-lived intangibles assets had been hypothetically reduced by 10% or the discount rate had been hypothetically increased by 100 basis points at April 30, 2020, the fair value of these assets would still exceed their book value. For the indefinite-lived intangible assets that were impaired at March 31, 2020, the implied fair values continue to approximate net book values at April 30, 2020. Should the Company’s analysis in the future indicate additional unfavorable impacts related to the ongoing COVID-19 pandemic, an increase in discount rates, or a degradation in the use of the tradenames and trademarks, any of which could have a negative material impact to the implied fair values and could result in a future impairment to the carrying value of the indefinite-lived intangible assets. There can be no assurance that the Company’s future indefinite-lived intangible asset impairment testing will not result in a charge to earnings. This impairment charge could have a negative material impact on the Company’s results of operations. March 31, 2020 Impairment Testing In preparing the financial statements for the three months ended March 31, 2020, the Company identified an impairment triggering event related to four of its reporting units. The Company had experienced a meaningful decrease in customer demand for its products as a result of stay-at-home orders, travel restrictions, and social distancing guidelines set forth by governmental authorities throughout the world in response to the COVID-19 pandemic. These actions meaningfully impacted end-user demand for routine dental procedures in most of the Company's markets. The Company updated its future forecasted revenues, operating margins, and weighted average cost of capital for all four of the reporting units which were impacted by the continuing pandemic. Based on the Company's best estimates and assumptions at March 31, 2020, the Company believed forecasted future revenue growth related to the Equipment & Instruments reporting unit will experience an extended recovery period in returning to the pre-COVID-19 levels. The Company believed that dental practitioners will focus their initial post-COVID-19 equipment spending on products that deliver short-term revenue gains for their practices before replacing the Imaging, Treatment Center, and Instruments products that comprise the Equipment & Instruments reporting unit. After this extended recovery period, the Company expects the growth rates of the Equipment & Instruments reporting unit to return to pre-COVID-19 levels. To determine the fair value of these four reporting units, the Company used a discounted cash flow model with market-based support as its valuation technique to measure the fair value for its reporting units. The discounted cash flow model used five-to-ten-year forecasted cash flows plus a terminal value based on a multiple of earnings or by capitalizing the last period’s cash flows using a perpetual growth rate. The Company's significant assumptions in the discounted cash flow models included, but are not limited to: the weighted average cost of capital, revenue growth rates, including perpetual revenue growth rates, and operating margin percentages of the reporting unit's business. The Company considered the current market conditions when determining its assumptions. The total forecasted cash flows were discounted based on a range between 9.5% to 11.5%, which included assumptions regarding the Company’s weighted average cost of capital. Lastly, the Company reconciled the aggregate fair values of its reporting units to its market capitalization, which included a reasonable control premium based on market conditions. These future expectations included, but are not limited to, the current and ongoing impact of the COVID-19 pandemic and new product development changes for these reporting units. The Company also considered the current and projected market and economic conditions amid the ongoing pandemic for the dental industry both in the U.S. and globally, when determining its assumptions. The use of estimates and the development of assumptions results in uncertainties around forecasted cash flows. A change in any of these estimates and assumptions, as well as unfavorable changes in the ongoing pandemic, could produce a different fair value, which could have a negative impact and result in a future impairment charge and could have a negative material impact on the Company’s results of operations. As a result of updating the estimates and assumptions in the ongoing COVID-19 pandemic and with the preparation of the financial statements for the three months ended March 31, 2020, the Company determined that the goodwill associated with the Equipment & Instruments reporting unit was impaired. As a result, the Company recorded a goodwill impairment charge of $156.6 million. This reporting unit is within the Technologies & Equipment segment. At March 31, 2020, the remaining goodwill related to the Equipment & Instruments reporting unit was $290.5 million. Based on the quantitative assessments performed for the three other reporting units, the Company believed that its adjusted long-term forecasted cash flows did not indicate that the fair value of these reporting units may be below their carrying value. In preparing the financial statements for the three months ended March 31, 2020 in conjunction with the goodwill impairment, the Company tested the indefinite-lived intangible assets related to the businesses within the four reporting units for impairment. The Company performed impairment tests using an income approach, more specifically a relief from royalty method. In the development of the forecasted cash flows, the Company applied significant judgment to determine key assumptions, including royalty rates and discount rates. Royalty rates used are consistent with those assumed for the original purchase accounting valuation. If the carrying value exceeds the fair value, an impairment loss in the amount equal to the excess is recognized. As a result, the Company identified that certain tradenames and trademarks related to businesses in the Equipment & Instruments reporting unit, within the Technologies & Equipment segment, were impaired. The Company recorded an impairment charge of $38.7 million for the three months ended March 31, 2020, which was recorded in Restructuring and other costs in the Consolidated Statements of Operations. The impairment charge was driven by a decline in forecasted sales as a result of the COVID-19 pandemic as discussed above, as well as an unfavorable change in the discount rate. The Company utilized discount rates ranging from 10.0% to 17.5%. The assumptions and estimates used in determining the fair value of the indefinite-lived intangible assets contain uncertainties and any changes to these assumptions and estimates, including unfavorable changes related to the COVID-19 pandemic, could have a negative impact and result in a future impairment charge and could have a negative material impact on the Company's results of operations. At March 31, 2020, the remaining indefinite-lived tradenames and trademarks related to the Equipment & Instruments reporting unit was $75.0 million. Based on the quantitative assessments performed for the indefinite-lived intangible assets related to the businesses in the three other reporting units, the Company believed that its adjusted long-term forecasted cash flows did not indicate that the fair value of the indefinite-lived intangible assets may be below their carrying value. A reconciliation of changes in the Company’s goodwill by reportable segment were as follows: (in millions) Technologies & Equipment Consumables Total Balance at December 31, 2019 $ 2,515.7 $ 880.8 $ 3,396.5 Impairment (156.6) — (156.6) Effects of exchange rate changes 44.3 (1.5) 42.8 Balance at September 30, 2020 $ 2,403.4 $ 879.3 $ 3,282.7 The gross carrying amount of goodwill and the cumulative goodwill impairment were as follows: September 30, 2020 December 31, 2019 (in millions) Gross Carrying Amount Cumulative Impairment Net Carrying Amount Gross Carrying Amount Cumulative Impairment Net Carrying Amount Technologies & Equipment $ 5,296.5 $ (2,893.1) $ 2,403.4 $ 5,252.3 $ (2,736.6) $ 2,515.7 Consumables 879.3 — 879.3 880.8 — 880.8 Total effect of cumulative impairment $ 6,175.8 $ (2,893.1) $ 3,282.7 $ 6,133.1 $ (2,736.6) $ 3,396.5 Identifiable definite-lived and indefinite-lived intangible assets were as follows: September 30, 2020 December 31, 2019 (in millions) Gross Accumulated Net Gross Accumulated Net Patents $ 1,420.3 $ (623.5) $ 796.8 $ 1,371.9 $ (517.9) $ 854.0 Tradenames and trademarks 81.3 (68.2) 13.1 79.0 (63.4) 15.6 Licensing agreements 36.4 (29.4) 7.0 36.0 (27.9) 8.1 Customer relationships 1,091.5 (461.5) 630.0 1,070.5 (399.2) 671.3 Total definite-lived $ 2,629.5 $ (1,182.6) $ 1,446.9 $ 2,557.4 $ (1,008.4) $ 1,549.0 Indefinite-lived tradenames and trademarks $ 611.2 $ — $ 611.2 $ 627.3 $ — $ 627.3 Total identifiable intangible assets $ 3,240.7 $ (1,182.6) $ 2,058.1 $ 3,184.7 $ (1,008.4) $ 2,176.3 During the nine months ended September 30, 2019, the Company impaired $5.3 million of product tradenames and trademarks within the Technologies & Equipment segment. The impairment was the result of a change in forecasted sales related to divestitures of non-strategic product lines. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Litigation As previously disclosed, in 2017, the Division of Enforcement of the SEC asked the Company to provide documents and information relating to the Company’s accounting and disclosures. The Company has been fully cooperating with the SEC in connection with its investigation. The Company now is discussing a possible resolution of the investigation. Any agreement reached with the staff would be subject to Commission approval. There is no assurance that a settlement will be reached, or whether it will have a material impact on the Company’s consolidated financial position, results of operations or cash flows. On January 11, 2018, Tom Redlich, a former employee, filed a lawsuit against the Company, demanding supplemental compensation pursuant to an agreement allegedly entered into with Sirona Dental GmbH which was intended to entice Mr. Redlich to continue to work for the Company for no less than eight years following the date of this agreement. The Company filed its response on April 4, 2018, denying the authenticity and enforceability of, and all liability under, the alleged agreement. Mr. Jost Fischer, upon invitation of the Company, joined the litigation against Mr. Redlich as a third party. In his submission to the Court, Mr. Fischer disputed the central allegations raised by Mr. Redlich in his lawsuit. The Court held several hearings in the matter, and then closed the hearings in June 2019 pending the Court’s decision on the capacity of Mr. Fischer to enter into a binding agreement of the type alleged by Mr. Redlich in the manner alleged. On November 5, 2019, the Company received the Court’s judgment rejecting Mr. Redlich’s lawsuit and dismissing his claims. Mr. Redlich appealed in December 2019 and the Company filed its response in January 2020 seeking to uphold the Court’s ruling. On February 27, 2020, the Company received the Appellate Court’s decision rejecting Mr. Redlich’s appeal and upholding the decision of the lower court dismissing his claims. The Court of Appeals has denied Mr. Redlich the right to file a further appeal in this matter, however, on March 23, 2020, Mr. Redlich filed an extraordinary appeal with the Austrian Supreme Court which will assess the appeal. If the Austrian Supreme Court accepts Mr. Redlich’s extraordinary appeal, the Company will then file its response. On January 25, 2018, Futuredontics, Inc., a former wholly-owned subsidiary of the Company, received service of a purported class action lawsuit brought by Henry Olivares and other similarly situated individuals in the Superior Court of the State of California for the County of Los Angeles. In January 2019, an amended complaint was filed adding another named plaintiff, Rachael Clarke, and various claims. The plaintiff class alleges several violations of the California wage and hours laws, including, but not limited to, failure to provide rest and meal breaks and the failure to pay overtime. The parties have engaged in written and other discovery. On February 5, 2019, Plaintiff Calethia Holt (represented by the same counsel as Mr. Olivares and Ms. Clarke) filed a separate representative action in Los Angeles Superior Court alleging a single violation of the Private Attorneys’ General Act that is based on the same underlying claims as the Olivares/Clarke lawsuit. On April 5, 2019, Plaintiff Kendra Cato filed a similar action in Los Angeles Superior Court alleging a single violation of the Private Attorneys’ General Act that is based on the same underlying claims as the Olivares/Clarke lawsuit. The Company has resolved the Cato lawsuit and continues to vigorously defend against the Olivares and Holt matters. In Olivares, the Plaintiffs filed a motion for class certification on September 14, 2020. The response is due on December 31, 2020. On June 7, 2018, and August 9, 2018, two putative class action suits were filed, and later consolidated, in the Supreme Court of the State of New York, County of New York claiming that the Company and certain individual defendants, violated U.S. securities laws (the "State Court Class Action") by making material misrepresentations and omitting required information in the December 4, 2015 registration statement filed with the SEC in connection with the Merger. The amended complaint alleges that the defendants failed to disclose, among other things, that a distributor had purchased excessive inventory of legacy Sirona products and that three distributors of the Company's products had been engaging in anticompetitive conduct. The plaintiffs seek to recover damages on behalf of a class of former Sirona shareholders who exchanged their shares for shares of the Company's stock in the Merger. The Company has filed motions to dismiss the amended complaint, to stay discovery pending resolution of the motion to dismiss, and to stay all proceedings pending resolution of the Federal Class Action described below. On August 2, 2019, the Court denied the Company's motions to stay discovery and to stay all proceedings. On August 21, 2019, the Company filed a notice of appeal of that decision. Briefing has not yet commenced on that appeal. On September 26, 2019, the Court granted the Company's motion to dismiss all claims. The associated judgment was entered on September 30, 2019. On October 25, 2019, the plaintiffs filed a notice of appeal of the motion to dismiss the decision and the judgment. On November 4, 2019, the Company filed a notice of cross-appeal of select rulings in the Court's motion to dismiss decision. On October 9, 2019, the plaintiffs moved by order to show cause to vacate or modify the judgment and grant plaintiffs leave to amend their complaint. On February 4, 2020, the Court denied the plaintiffs' motion. On March 5, 2020, the plaintiffs also filed a notice of appeal from the denial of their motion to vacate or modify the judgment and for leave to amend their complaint. The Plaintiffs have filed their opening appellate brief and the Company has filed its response. On December 19, 2018, a related putative class action was filed in the U.S. District Court for the Eastern District of New York against the Company and certain individual defendants (the "Federal Class Action"). The plaintiff makes similar allegations and asserts the same claims as those asserted in the State Court Class Action. In addition, the plaintiff alleges that the defendants violated U.S. securities laws by making false and misleading statements in quarterly and annual reports and other public statements between February 20, 2014, and August 7, 2018. The plaintiff asserts claims on behalf of a putative class consisting of (a) all purchasers of the Company's stock during the period February 20, 2014 through August 7, 2018 and (b) former shareholders of Sirona who exchanged their shares of Sirona stock for shares of the Company's stock in the Merger. The Company's motion to dismiss the amended complaint was served on August 15, 2019. Briefing was completed on October 21, 2019 and the Company is awaiting the decision of the Court. On April 29, 2019, two purported stockholders of the Company filed a derivative action on behalf of the Company in the U.S. District Court for the District of Delaware against the Company's directors (the "Stockholder's Derivative Action"). Based on allegations similar to those asserted in the class actions described above, the plaintiffs allege that the directors caused the Company to misrepresent its business prospects and thereby subjected the Company to multiple securities class actions and other litigation. On September 20, 2019, the plaintiffs in the Stockholder's Derivative Action filed an amended derivative complaint on behalf of the Company in the U.S. District Court for the District of Delaware against the Company's directors. The plaintiffs assert claims for breach of fiduciary duty, unjust enrichment, waste of corporate assets, and violations of the U.S. securities laws. The plaintiffs seek relief that includes, among other things, monetary damages and various corporate governance reforms. The Company filed a motion to dismiss, and on July 31, 2020 the Magistrate Judge issued a report and recommendation to the District Court Judge recommending dismissal of the case with prejudice. On September 25, 2020, the District Court Judge issued an order adopting the Magistrate Judge’s report dismissing the case, but without prejudice, and provided the plaintiffs with three weeks to file a motion to amend their complaint. On October 16, 2020, the plaintiffs filed a notice advising the Court that they will not be amending their complaint. On October 23, 2020, the Court entered an order dismissing the case with prejudice as to the named plaintiffs. The Company intends to defend itself vigorously in these actions. As a result of an audit by the IRS for fiscal years 2012 through 2013, on February 11, 2019, the IRS issued to the Company a “30-day letter” and a Revenue Agent’s Report (“RAR”), relating to the Company’s worthless stock deduction in 2013 in the amount of $546.0 million. The RAR disallows the deduction and, after adjusting the Company’s net operating loss carryforward, asserts that the Company is entitled to a refund of $4.7 million for 2012, has no tax liability for 2013, and owes a deficiency of $17.1 million in tax for 2014, excluding interest. In accordance with ASC 740, the Company recorded the tax benefit associated with the worthless stock deduction in the Company’s 2012 financial statements. The Company has submitted a formal protest disputing on multiple grounds the proposed taxes. The Company believes the IRS' position is without merit and believes that it is more-likely-than-not, the Company’s position will be sustained upon further review. The Company has not accrued a liability relating to the proposed tax adjustments. However, the outcome of this dispute involves a number of uncertainties, including those inherent in the valuation of various assets at the time of the worthless stock deduction, and those relating to the application of the Internal Revenue Code and other federal income tax authorities and judicial precedent. Accordingly, there can be no assurance that the dispute with the IRS will be resolved favorably. If determined adversely, the dispute would result in a current period charge to earnings and could have a material adverse effect in the consolidated results of operations, financial position, and liquidity of the Company. The Swedish Tax Agency has disallowed certain of the Company’s interest expense deductions for the tax years from 2013 to 2018. If such interest expense deductions were disallowed, the Company would be subject to an additional $56 million in tax expense. The Company has appealed the disallowance to the Swedish Administrative Court. With respect to such deductions taken in the tax years from 2013 to 2014, the Court ruled against the Company on July 5, 2017. On August 7, 2017, the Company appealed the unfavorable decision of the Swedish Administrative Court. On November 5, 2018, the Company delivered its final argument to the Administrative Court of Appeals at a hearing. The European Union Commission has taken the view that Sweden’s interest deduction limitation rules are incompatible with European Union law and supporting legal opinions, and therefore the Company has not paid the tax or made provision in its financial statements for such potential expense. The Company intends to vigorously defend its position and pursue related appeals. In addition to the matters disclosed above, the Company is, from time to time, subject to a variety of litigation and similar proceedings incidental to its business. These additional legal matters involve a variety of matters, including, among others, claims for damages arising out of the use of the Company’s products and services and claims relating to intellectual property matters including patent infringement, employment matters, tax matters, commercial disputes, competition and sales and trading practices, personal injury, and insurance coverage. The Company may also become subject to lawsuits as a result of past or future acquisitions or as a result of liabilities retained from, or representations, warranties or indemnities provided in connection with, divested businesses. Some of these lawsuits may include claims for punitive and consequential, as well as compensatory damages. Based upon the Company’s experience, current information and applicable law, it does not believe that these additional legal matters will have a material adverse effect on its consolidated results of operations, financial position, or liquidity. However, in the event of unexpected further developments, it is possible that the ultimate resolution of these matters, or other similar matters, if unfavorable, may be materially adverse to the Company’s business, financial condition, results of operations, or liquidity. While the Company maintains general, product, property, workers’ compensation, automobile, cargo, aviation, crime, fiduciary and directors’ and officers’ liability insurance up to certain limits that cover certain of these claims, this insurance may be insufficient or unavailable to cover such losses. In addition, while the Company believes it is entitled to indemnification from third parties for some of these claims, these rights may also be insufficient or unavailable to cover such losses. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | On October 22, 2020, the Company paid $45 million for a minority ownership position in a privately-held dental services company. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and the rules of the U.S. Securities and Exchange Commission (“SEC”). In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of the results for interim periods have been included. Results for interim periods should not be considered indicative of results for a full year. These financial statements and related notes contain the accounts of DENTSPLY SIRONA Inc. and subsidiaries (“Dentsply Sirona” or the “Company”) on a consolidated basis and should be read in conjunction with the consolidated financial statements and notes included in the Company’s most recent Form 10-K for the year ended December 31, 2019. The accounting policies of the Company, as applied in the interim consolidated financial statements presented herein, are substantially the same as presented in the Company’s Form 10-K for the year ended December 31, 2019, except as may be indicated below. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of 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, and such differences may be material to the consolidated financial statements. |
Revenue Recognition | Revenue Recognition At September 30, 2020, the Company had $28.4 million of deferred revenue recorded in Accrued liabilities in the Consolidated Balance Sheets. The Company expects to recognize significantly all of the deferred revenue within the next 12 months. |
Accounts and Notes Receivable | Accounts and Notes Receivable The Company records a provision for doubtful accounts, which is included in Selling, general, and administrative expenses in the Consolidated Statements of Operations. |
Recently Adopted Accounting Pronouncements and Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (" FASB") i ssued Accounting Standards Update ( "ASU") No. 2016-13 "Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments." This newly issued accounting standard changes the recognition and measurement of credit losses, including trade accounts receivable. Under current accounting standards, a loss is recognized when such loss becomes probable of occurring. The new standard broadens the information that an entity must consider when developing expected credit loss estimates. The Company adopted this accounting standard on January 1, 2020. The adoption of this standard did not materially impact the Company's financial position, results of operations, cash flows, disclosures, or internal controls. In August 2018, the FASB issued ASU No. 2018-14 "Compensation - Retirement Benefits - Defined Benefit Plans - General (Subtopic 715-20): Disclosure Framework - Changes to the Disclosure Requirements for Defined Benefit Plans." This newly issued accounting standard changes disclosure requirements for defined benefit plans, including removal and modification of existing disclosures. The amendments in this standard are required for fiscal years ending after December 15, 2020. The amendments should be applied on a retrospective basis for all periods presented. The Company adopted this accounting standard on January 1, 2020. The adoption of this standard did not materially impact the Company's disclosures. In December 2019, the FASB issued ASU No. 2019-12 "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes." This newly issued accounting standard simplifies key provisions for accounting for income taxes, as part of the FASB's initiative to reduce complexity in accounting standards. The amendments eliminate certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period, and the recognition of deferred tax liabilities for outside basis differences. The amendments also clarify and simplify other aspects of the accounting for income taxes. The amendments in this update are effective for interim and fiscal periods beginning after December 31, 2020. The Company adopted this accounting standard on January 1, 2020. The adoption of this standard did not materially impact the Company's financial position, results of operations, cash flows, disclosures, or internal controls. Accounting Pronouncements Not Yet Adopted In March 2020, the FASB issued ASU No. 2020-04 "Reference Rate Reform (Topic 828): Facilitation of the Effects of Reference Rate Reform on Financial Reporting." This newly issued accounting standard provides guidance on whether the change in reference rate is a modification versus an extinguishment of a contract. Specifically, there is risk of cessation of the London Interbank Offer Rate ("LIBOR"). The Company has certain variable interest rate debt that use LIBOR as a reference rate. The guidance provided by this accounting standard may be used for contracts entered into on or before December 31, 2022 on a prospective basis. The Company is currently assessing the impact that this standard will have on its financial position, results of operations, cash flows, and disclosures. |
Foreign Exchange Risk Management | Foreign Exchange Risk Management The Company uses a program to hedge select anticipated foreign currency cash flows to reduce volatility in both cash flows and reported earnings of the consolidated Company. The Company accounts for the designated foreign exchange forward contracts as cash flow hedges. As a result, the Company records the fair value of the contracts primarily through AOCI based on the assessed effectiveness of the foreign exchange forward contracts. The Company measures the effectiveness of cash flow hedges of anticipated transactions on a spot-to-spot basis rather than on a forward-to-forward basis. Accordingly, the spot-to-spot change in the derivative fair value will be deferred in AOCI and released and recorded in the Consolidated Statements of Operations in the same period that the hedged transaction is recorded. The time-value component of the fair value of the derivative is reported on a straight-line basis in Cost of products sold in the Consolidated Statements of Operations in the period which it is applicable. Any cash flows associated with these instruments are included in operating activities in the Consolidated Statements of Cash Flows. These foreign exchange forward contracts generally have maturities up to 18 months and the counterparties to the transactions are typically large international financial institutions. |
STOCK COMPENSATION (Tables)
STOCK COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Stock Based Compensation | Total stock based compensation expense for non-qualified stock options, restricted stock units ("RSU"), and the tax related benefit for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Stock option expense $ 1.6 $ 0.6 $ 5.1 $ 5.6 RSU expense 14.7 14.6 30.3 43.4 Total stock based compensation expense $ 16.3 $ 15.2 $ 35.4 $ 49.0 Related deferred income tax benefit $ 1.6 $ 1.8 $ 3.7 $ 6.8 |
COMPREHENSIVE INCOME (LOSS) (Ta
COMPREHENSIVE INCOME (LOSS) (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Schedule of Components of Comprehensive Income | Components of Other comprehensive income (loss), net of tax, for the three and nine months ended September 30, 2020 and 2019 were as follows: Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Foreign currency translation gains (losses) $ 107.1 $ (147.2) $ 67.6 $ (164.2) Foreign currency translation (losses) gains on hedges of net investments (22.3) 19.7 (28.0) 19.1 |
Schedule of Accumulated Other Comprehensive Income (Loss) | Changes in AOCI, net of tax, by component for the nine months ended September 30, 2020 and 2019 were as follows: (in millions) Foreign Currency Translation Gain (Loss) Gain (Loss) on Cash Flow Hedges Gain (Loss) on Net Investment Hedges Pension Liability Gain (Loss) Total Balance, net of tax, at December 31, 2019 $ (368.3) $ (10.6) $ (100.7) $ (120.1) $ (599.7) Other comprehensive income (loss) before reclassifications and tax impact 26.3 (18.8) (7.0) — 0.5 Tax benefit 13.3 2.4 0.8 — 16.5 Other comprehensive income (loss), net of tax, before reclassifications 39.6 (16.4) (6.2) — 17.0 Amounts reclassified from accumulated other comprehensive income, net of tax — 0.4 — 4.7 5.1 Net increase (decrease) in other comprehensive loss 39.6 (16.0) (6.2) 4.7 22.1 Balance, net of tax, at September 30, 2020 $ (328.7) $ (26.6) $ (106.9) $ (115.4) $ (577.6) (in millions) Foreign Currency Translation Gain (Loss) Gain (Loss) on Cash Flow Hedges Gain (Loss) on Net Investment Hedges Pension Liability Gain (Loss) Total Balance, net of tax, at December 31, 2018 $ (284.7) $ 0.6 $ (111.4) $ (83.2) $ (478.7) Other comprehensive (loss) income before reclassifications and tax impact (134.0) (18.6) 31.7 — (120.9) Tax (expense) benefit (11.1) 4.5 (7.0) — (13.6) Other comprehensive (loss) income, net of tax, before reclassifications (145.1) (14.1) 24.7 — (134.5) Amounts reclassified from accumulated other comprehensive income, net of tax — 1.4 — 2.7 4.1 Net (decrease) increase in other comprehensive loss (145.1) (12.7) 24.7 2.7 (130.4) Balance, net of tax, at September 30, 2019 $ (429.8) $ (12.1) $ (86.7) $ (80.5) $ (609.1) |
EARNINGS PER COMMON SHARE (Tabl
EARNINGS PER COMMON SHARE (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The computation of basic and diluted earnings per common share for the three and nine months ended September 30, 2020 and 2019 were as follows: Basic Earnings Per Common Share Computation Three Months Ended Nine Months Ended (in millions, except per share amounts) 2020 2019 2020 2019 Net income (loss) attributable to Dentsply Sirona $ 53.8 $ 85.0 $ (181.5) $ 160.6 Weighted average common shares outstanding 218.5 223.1 219.4 223.5 Earnings (loss) per common share - basic $ 0.25 $ 0.38 $ (0.83) $ 0.72 Diluted Earnings Per Common Share Computation Three Months Ended Nine Months Ended (in millions, except per share amounts) 2020 2019 2020 2019 Net income (loss) attributable to Dentsply Sirona $ 53.8 $ 85.0 $ (181.5) $ 160.6 Weighted average common shares outstanding 218.5 223.1 219.4 223.5 Incremental weighted average shares from assumed exercise of dilutive options from stock-based compensation awards 0.7 1.8 — 1.7 Total weighted average diluted shares outstanding 219.2 224.9 219.4 225.2 Earnings (loss) per common share - diluted $ 0.25 $ 0.38 $ (0.83) $ 0.71 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Third Party Net Sales | The Company’s segment information for the three and nine months ended September 30, 2020 and 2019 was as follows: Net Sales Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Technologies & Equipment $ 503.8 $ 534.5 $ 1,328.0 $ 1,613.7 Consumables 391.0 427.6 931.7 1,304.0 Total net sales $ 894.8 $ 962.1 $ 2,259.7 $ 2,917.7 |
Segment Adjusted Operating Income | Segment Adjusted Operating Income Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Technologies & Equipment $ 109.6 $ 104.7 $ 216.9 $ 272.5 Consumables 99.1 113.8 143.1 341.3 Segment adjusted operating income 208.7 218.5 360.0 613.8 Reconciling items expense (income): All other (a) 57.9 54.7 141.1 173.3 Goodwill impairment — — 156.6 — Restructuring and other costs 18.7 5.2 62.5 68.1 Interest expense 14.5 6.6 33.5 23.0 Interest income (0.4) (0.7) (1.8) (2.0) Other expense (income), net 0.9 (2.9) 3.8 (4.6) Amortization of intangible assets 48.8 47.4 142.6 142.9 Depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations 1.6 1.7 4.6 5.2 Income (loss) before income taxes $ 66.7 $ 106.5 $ (182.9) $ 207.9 (a) Includes the results of unassigned Corporate headquarters costs and inter-segment eliminations. |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories, Net | Inventories, net were as follows: (in millions) September 30, 2020 December 31, 2019 Finished goods $ 282.0 $ 356.4 Work-in-process 75.0 82.5 Raw materials and supplies 132.1 122.8 Inventories, net $ 489.1 $ 561.7 |
RESTRUCTURING AND OTHER COSTS (
RESTRUCTURING AND OTHER COSTS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The details of total restructuring costs for the three and nine months ended September 30 were as follows: Affected Line Item in the Consolidated Statements of Operations Three Months Ended Nine Months Ended (in millions) 2020 2019 2020 2019 Cost of products sold $ 32.3 $ 3.6 $ 32.7 $ 24.3 Selling, general, and administrative expenses 1.3 (1.1) 0.6 20.3 Restructuring and other costs 18.7 5.2 62.5 68.1 Other income and expenses — (0.4) (0.3) 5.0 Total restructuring costs $ 52.3 $ 7.3 $ 95.5 $ 117.7 The Company’s restructuring accruals at September 30, 2020 were as follows: Severance (in millions) 2018 and 2019 Plans 2020 Plans Total Balance at December 31, 2019 $ 7.2 $ 19.8 $ — $ 27.0 Provisions 1.1 1.5 19.3 21.9 Amounts applied (3.2) (7.4) (1.8) (12.4) Change in estimates (0.5) (3.6) — (4.1) Balance at September 30, 2020 $ 4.6 $ 10.3 $ 17.5 $ 32.4 Lease/Contract Terminations (in millions) 2018 and 2020 Plans Total Balance at December 31, 2019 $ 0.5 $ — $ 0.5 Provisions 0.4 0.3 0.7 Amounts applied (0.4) (0.1) (0.5) Balance at September 30, 2020 $ 0.5 $ 0.2 $ 0.7 Other Restructuring Costs (in millions) 2018 and 2019 Plans 2020 Plans Total Balance at December 31, 2019 $ 2.2 $ 0.3 $ — $ 2.5 Provisions — 0.5 0.4 0.9 Amounts applied — (0.7) 0.1 (0.6) Change in estimate — (0.1) — (0.1) Balance at September 30, 2020 $ 2.2 $ — $ 0.5 $ 2.7 |
Cumulative Amounts for the Provisions and Adjustments and Amounts Applied for All the Plans by Segment | The cumulative amounts for the provisions and adjustments and amounts applied for all the plans by segment were as follows: (in millions) December 31, 2019 Provisions Amounts Change in Estimates September 30, 2020 Technologies & Equipment $ 19.1 $ 16.3 $ (8.0) $ (4.0) $ 23.4 Consumables 11.4 4.5 (3.9) (0.1) 11.9 All Other (0.5) 2.7 (1.6) (0.1) 0.5 Total $ 30.0 $ 23.5 $ (13.5) $ (4.2) $ 35.8 |
FINANCIAL INSTRUMENTS AND DER_2
FINANCIAL INSTRUMENTS AND DERIVATIVES (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | The following summarizes the notional amounts of cash flow hedges by derivative instrument type at September 30, 2020 and the notional amounts expected to mature during the next 12 months, with a discussion of the various cash flow hedges by derivative instrument type following the table: (in millions) Aggregate Notional Amount Aggregate Notional Amount Maturing within 12 Months Foreign exchange forward contracts $ 325.6 $ 236.9 Total derivative instruments designated as cash flow hedges $ 325.6 $ 236.9 The notional amount of hedges of net investments by derivative instrument type at September 30, 2020 and the notional amounts expected to mature during the next 12 months were as follows: (in millions) Aggregate Aggregate Notional Amount Maturing within 12 Months Cross currency basis swaps $ 308.6 $ 308.6 Total for instruments designated as hedges of net investment $ 308.6 $ 308.6 The notional amounts of fair value hedges by derivative instrument type at September 30, 2020 and the notional amounts expected to mature during the next 12 months were as follows: (in millions) Aggregate Aggregate Notional Amount Maturing within 12 Months Foreign exchange forward contracts $ 98.3 $ 70.2 Total derivative instruments as fair value hedges $ 98.3 $ 70.2 |
Derivative Instruments, Gain (Loss) | Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Cost of products sold and Interest expense in the Company's Consolidated Statements of Operations related to all cash flow hedges for the nine months ended September 30, 2020 were as follows: Nine Months Ended September 30, 2020 Gain (Loss) in AOCI Consolidated Statements of Operations Location Effective Portion Reclassified from AOCI into Income (Expense) Ineffective Portion Recognized in Income (Expense) (in millions) Effective Portion: Foreign exchange forward contracts $ (1.7) Cost of products sold $ 2.2 $ — Interest rate swaps (17.1) Interest expense (2.6) — Ineffective Portion: Foreign exchange forward contracts — Cost of products sold — 2.2 Total in cash flow hedging $ (18.8) $ (0.4) $ 2.2 Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Cost of products sold and Interest expense in the Company’s Consolidated Statements of Operations related to all cash flow hedges for the nine months ended September 30, 2019 were as follows: Nine Months Ended September 30, 2019 Gain (Loss) in AOCI Consolidated Statements of Operations Location Effective Portion Reclassified from AOCI into Income (Expense) Ineffective Portion Recognized in Income (Expense) (in millions) Effective Portion: Foreign exchange forward contracts $ (4.0) Cost of products sold $ 0.4 $ — Interest rate swaps (14.6) Interest expense (1.8) — Ineffective Portion: Foreign exchange forward contracts — Cost of products sold — 1.5 Total in cash flow hedging $ (18.6) $ (1.4) $ 1.5 The fair value of the foreign exchange forward contracts and cross currency basis swaps is the estimated amount the Company would receive or pay at the reporting date, taking into account the effective interest rates, cross currency swap basis rates, and foreign exchange rates. The effective portion of the change in the value of these derivatives is recorded in AOCI, net of tax effects. Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Interest expense and Other expense (income), net in the Company’s Consolidated Statements of Operations related to the hedges of net investments for the three months ended September 30, 2020 and 2019 were as follows: Three Months Ended September 30, 2020 Gain (Loss) in AOCI Consolidated Statements of Operations Location Recognized in Income (Expense) (in millions) Effective Portion: Cross currency basis swaps $ (16.8) Interest expense $ 2.0 Total for net investment hedging $ (16.8) $ 2.0 Three Months Ended September 30, 2019 (in millions) Gain (Loss) in AOCI Consolidated Statements of Operations Locations Recognized in Income (Expense) Effective Portion: Cross currency basis swaps $ 12.4 Interest expense $ 2.2 Foreign exchange forward contracts 25.5 Other expense (income), net 6.1 Total for net investment hedging $ 37.9 $ 8.3 Gains and losses recorded in AOCI in the Consolidated Balance Sheets, Interest expense and Other expense (income), net in the Company's Consolidated Statements of Operations related to the hedges of net investments for the nine months ended September 30, 2020 and 2019 were as follows: Nine Months Ended September 30, 2020 Gain (Loss) in AOCI Consolidated Statements of Operations Location Recognized in Income (Expense) (in millions) Effective Portion: Cross currency basis swaps $ (13.4) Interest expense $ 6.4 Foreign exchange forward contracts 6.4 Other expense (income), net 6.2 Total for net investment hedging $ (7.0) $ 12.6 Nine Months Ended September 30, 2019 (in millions) Gain (Loss) in AOCI Consolidated Statements of Operations Location Recognized in Income (Expense) Effective Portion: Cross currency basis swaps $ 13.1 Interest expense $ 6.3 Foreign exchange forward contracts 31.7 Other expense (income), net 15.7 Total for net investment hedging $ 44.8 $ 22.0 On April 7, 2020, the Company terminated its entire foreign exchange forward contracts net investment hedge portfolio early which resulted in a $48.1 million cash receipt. The Company elected to enter into this transaction to convert the favorable gain position into additional liquidity. |
Schedule of Aggregate Notional Amounts of Economic Hedges Not Designated as Hedges | The aggregate notional amounts of the Company’s economic hedges not designated as hedges by derivative instrument types at September 30, 2020 and the notional amounts expected to mature during the next 12 months were as follows: (in millions) Aggregate Aggregate Notional Amount Maturing within 12 Months Foreign exchange forward contracts $ 226.2 $ 226.2 Total for instruments not designated as hedges $ 226.2 $ 226.2 |
Fair Value, by Balance Sheet Grouping | The fair value and the location of the Company's derivatives in the Consolidated Balance Sheets at December 31, 2019 were as follows: December 31, 2019 (in millions) Prepaid Expenses and Other Current Assets Other Noncurrent Assets Accrued Liabilities Other Noncurrent Liabilities Designated as Hedges: Foreign exchange forward contracts $ 26.9 $ 11.3 $ 1.3 $ 1.8 Interest rate swaps — — — 10.8 Cross currency basis swaps — 6.9 — — Total $ 26.9 $ 18.2 $ 1.3 $ 12.6 Not Designated as Hedges: Foreign exchange forward contracts $ 2.0 $ — $ 1.5 $ — Total $ 2.0 $ — $ 1.5 $ — |
Offsetting Derivative Assets and Liabilities | Gross Amounts Not Offset in the Consolidated Balance Sheets (in millions) Gross Amounts Recognized Gross Amount Offset in the Consolidated Balance Sheets Net Amounts Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received/Pledged Net Amount Assets Foreign exchange forward contracts $ 4.3 $ — $ 4.3 $ (2.5) $ — $ 1.8 Total assets $ 4.3 $ — $ 4.3 $ (2.5) $ — $ 1.8 Liabilities Foreign exchange forward contracts $ 4.4 $ — $ 4.4 $ — $ — $ 4.4 Cross currency basis swaps 6.5 — 6.5 (2.5) — 4.0 Total liabilities $ 10.9 $ — $ 10.9 $ (2.5) $ — $ 8.4 Offsetting of financial assets and liabilities under netting arrangements at December 31, 2019 were as follows: Gross Amounts Not Offset in the Consolidated Balance Sheets (in millions) Gross Amounts Recognized Gross Amount Offset in the Consolidated Balance Sheets Net Amounts Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received/Pledged Net Amount Assets Foreign exchange forward contracts $ 38.8 $ — $ 38.8 $ (7.8) $ — $ 31.0 Cross currency basis swaps 6.9 — 6.9 (0.9) — 6.0 Total assets $ 45.7 $ — $ 45.7 $ (8.7) $ — $ 37.0 Liabilities Foreign exchange forward contracts $ 3.2 $ — $ 3.2 $ (3.0) $ — $ 0.2 Interest rate swaps 10.8 — 10.8 (5.7) — 5.1 Total liabilities $ 14.0 $ — $ 14.0 $ (8.7) $ — $ 5.3 |
FAIR VALUE MEASUREMENT (Tables)
FAIR VALUE MEASUREMENT (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of assets and liabilities at fair value | The Company’s financial assets and liabilities set forth by level within the fair value hierarchy that were accounted for at fair value on a recurring basis were as follows: September 30, 2020 (in millions) Total Level 1 Level 2 Level 3 Assets Foreign exchange forward contracts $ 4.3 $ — $ 4.3 $ — Total assets $ 4.3 $ — $ 4.3 $ — Liabilities Cross currency basis swaps $ 6.5 $ — $ 6.5 $ — Foreign exchange forward contracts 4.3 — 4.3 — Contingent considerations on acquisitions 5.7 — — 5.7 Total liabilities $ 16.5 $ — $ 10.8 $ 5.7 December 31, 2019 (in millions) Total Level 1 Level 2 Level 3 Assets Cross currency basis swaps $ 6.9 $ — $ 6.9 $ — Foreign exchange forward contracts 40.2 — 40.2 — Total assets $ 47.1 $ — $ 47.1 $ — Liabilities Interest rate swaps $ 10.8 $ — $ 10.8 $ — Foreign exchange forward contracts 4.6 — 4.6 — Contingent considerations on acquisitions 8.7 — — 8.7 Total liabilities $ 24.1 $ — $ 15.4 $ 8.7 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | A reconciliation of changes in the Company’s goodwill by reportable segment were as follows: (in millions) Technologies & Equipment Consumables Total Balance at December 31, 2019 $ 2,515.7 $ 880.8 $ 3,396.5 Impairment (156.6) — (156.6) Effects of exchange rate changes 44.3 (1.5) 42.8 Balance at September 30, 2020 $ 2,403.4 $ 879.3 $ 3,282.7 The gross carrying amount of goodwill and the cumulative goodwill impairment were as follows: September 30, 2020 December 31, 2019 (in millions) Gross Carrying Amount Cumulative Impairment Net Carrying Amount Gross Carrying Amount Cumulative Impairment Net Carrying Amount Technologies & Equipment $ 5,296.5 $ (2,893.1) $ 2,403.4 $ 5,252.3 $ (2,736.6) $ 2,515.7 Consumables 879.3 — 879.3 880.8 — 880.8 Total effect of cumulative impairment $ 6,175.8 $ (2,893.1) $ 3,282.7 $ 6,133.1 $ (2,736.6) $ 3,396.5 |
Schedule of Definite-lived and Indefinite-lived Intangible Assets | Identifiable definite-lived and indefinite-lived intangible assets were as follows: September 30, 2020 December 31, 2019 (in millions) Gross Accumulated Net Gross Accumulated Net Patents $ 1,420.3 $ (623.5) $ 796.8 $ 1,371.9 $ (517.9) $ 854.0 Tradenames and trademarks 81.3 (68.2) 13.1 79.0 (63.4) 15.6 Licensing agreements 36.4 (29.4) 7.0 36.0 (27.9) 8.1 Customer relationships 1,091.5 (461.5) 630.0 1,070.5 (399.2) 671.3 Total definite-lived $ 2,629.5 $ (1,182.6) $ 1,446.9 $ 2,557.4 $ (1,008.4) $ 1,549.0 Indefinite-lived tradenames and trademarks $ 611.2 $ — $ 611.2 $ 627.3 $ — $ 627.3 Total identifiable intangible assets $ 3,240.7 $ (1,182.6) $ 2,058.1 $ 3,184.7 $ (1,008.4) $ 2,176.3 |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES - ADDITIONAL INFORMATION (Details) | 9 Months Ended | |
Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($) | |
Significant Accounting Policies [Line Items] | ||
Cash and cash equivalents | $ 1,272,000,000 | $ 404,900,000 |
Debt instrument, covenant, operating income excluding depreciation and amortization to interest expense, minimum | 3 | |
Line of Credit | 2018 Revolving Credit Facility | ||
Significant Accounting Policies [Line Items] | ||
Maximum borrowing capacity | $ 700,000,000 | |
Line of Credit | Various Credit Facilities | ||
Significant Accounting Policies [Line Items] | ||
Maximum borrowing capacity | 400,000,000 | |
Trade Accounts Receivable | ||
Significant Accounting Policies [Line Items] | ||
Allowance for doubtful accounts and trade discounts | $ 31,100,000 | $ 29,400,000 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES - REVENUE RECOGNITION (Details) $ in Millions | Sep. 30, 2020USD ($) |
Accounting Policies [Abstract] | |
Revenue, remaining performance obligation, amount | $ 28.4 |
STOCK COMPENSATION (Details)
STOCK COMPENSATION (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock based compensation expense | $ 16.3 | $ 15.2 | $ 35.4 | $ 49 |
Related deferred income tax benefit | 1.6 | 1.8 | 3.7 | 6.8 |
Selling, general, and administrative expenses | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock based compensation expense | 16.1 | 14.7 | 34.6 | 47.5 |
Cost of products sold | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock based compensation expense | 0.2 | 0.5 | 0.8 | 1.5 |
Stock option expense | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock based compensation expense | 1.6 | 0.6 | 5.1 | 5.6 |
RSU expense | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock based compensation expense | $ 14.7 | $ 14.6 | $ 30.3 | $ 43.4 |
COMPREHENSIVE INCOME (LOSS) - S
COMPREHENSIVE INCOME (LOSS) - SUMMARY OF COMPREHENSIVE INCOME, NET OF TAX (Details) - Foreign Currency Translation Gain (Loss) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Condensed Statement of Income Captions [Line Items] | ||||
Foreign currency translation gains (losses) | $ 107.1 | $ (147.2) | $ 67.6 | $ (164.2) |
Foreign currency translation (losses) gains on hedges of net investments | ||||
Condensed Statement of Income Captions [Line Items] | ||||
Foreign currency translation gains (losses) | $ (22.3) | $ 19.7 | $ (28) | $ 19.1 |
COMPREHENSIVE INCOME (LOSS) - A
COMPREHENSIVE INCOME (LOSS) - ADDITIONAL INFORMATION (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Derivative [Line Items] | ||||||||
Cumulative foreign currency translation adjustment gain (loss) | $ 4,762.3 | $ 4,645.4 | $ 4,690.2 | $ 5,094.9 | $ 5,059.1 | $ 5,182.9 | $ 5,109.5 | $ 5,133 |
Foreign Currency Translation Gain (Loss) | ||||||||
Derivative [Line Items] | ||||||||
Foreign currency tax adjustment | 189.5 | 173 | ||||||
Cumulative foreign currency translation adjustment gain (loss) | (328.7) | (368.3) | $ (429.8) | $ (284.7) | ||||
Accumulated Foreign Currency Adjustment Including Portion Attributable to Noncontrolling Interest, Translation Gain (Loss) | ||||||||
Derivative [Line Items] | ||||||||
Cumulative foreign currency translation adjustment gain (loss) | (192.6) | (260.2) | ||||||
Accumulated Foreign Currency Adjustment Including Portion Attributable to Noncontrolling Interest, Net Investment Hedges | ||||||||
Derivative [Line Items] | ||||||||
Cumulative foreign currency translation adjustment gain (loss) | $ (136.1) | $ (108.1) |
COMPREHENSIVE INCOME (LOSS) - B
COMPREHENSIVE INCOME (LOSS) - BALANCES INCLUDED IN AOCI, NET OF TAX, IN THE CONSOLIDATED BALANCE SHEETS (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||||
Beginning Balance | $ 4,645.4 | $ 4,690.2 | $ 5,094.9 | $ 5,182.9 | $ 5,109.5 | $ 5,133 | $ 5,094.9 | $ 5,133 |
Total other comprehensive income (loss), net of tax | 67.1 | 67.6 | (112.2) | (106.5) | 34.8 | (58.4) | 22.5 | (130.1) |
Ending Balance | 4,762.3 | 4,645.4 | 4,690.2 | 5,059.1 | 5,182.9 | 5,109.5 | 4,762.3 | 5,059.1 |
Accumulated Other Comprehensive Loss | ||||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||||
Beginning Balance | (644.7) | (712.2) | (599.7) | (502.6) | (537.4) | (478.7) | (599.7) | (478.7) |
Other comprehensive (loss) income before reclassifications and tax impact | 0.5 | (120.9) | ||||||
Tax benefit | 16.5 | (13.6) | ||||||
Other comprehensive (loss) income, net of tax, before reclassifications | 17 | (134.5) | ||||||
Amounts reclassified from accumulated other comprehensive income, net of tax | 5.1 | 4.1 | ||||||
Total other comprehensive income (loss), net of tax | 67.1 | 67.5 | (112.5) | (106.5) | 34.8 | (58.7) | 22.1 | (130.4) |
Ending Balance | (577.6) | $ (644.7) | (712.2) | (609.1) | $ (502.6) | (537.4) | (577.6) | (609.1) |
Foreign Currency Translation Gain (Loss) | ||||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||||
Beginning Balance | (368.3) | (284.7) | (368.3) | (284.7) | ||||
Other comprehensive (loss) income before reclassifications and tax impact | 26.3 | (134) | ||||||
Tax benefit | 13.3 | (11.1) | ||||||
Other comprehensive (loss) income, net of tax, before reclassifications | 39.6 | (145.1) | ||||||
Amounts reclassified from accumulated other comprehensive income, net of tax | 0 | 0 | ||||||
Total other comprehensive income (loss), net of tax | 39.6 | (145.1) | ||||||
Ending Balance | (328.7) | (429.8) | (328.7) | (429.8) | ||||
Gain (Loss) on Cash Flow Hedges | ||||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||||
Beginning Balance | (10.6) | 0.6 | (10.6) | 0.6 | ||||
Other comprehensive (loss) income before reclassifications and tax impact | (18.8) | (18.6) | ||||||
Tax benefit | 2.4 | 4.5 | ||||||
Other comprehensive (loss) income, net of tax, before reclassifications | (16.4) | (14.1) | ||||||
Amounts reclassified from accumulated other comprehensive income, net of tax | 0.4 | 1.4 | ||||||
Total other comprehensive income (loss), net of tax | (16) | (12.7) | ||||||
Ending Balance | (26.6) | (12.1) | (26.6) | (12.1) | ||||
Gain (Loss) on Net Investment Hedges | ||||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||||
Beginning Balance | (100.7) | (111.4) | (100.7) | (111.4) | ||||
Other comprehensive (loss) income before reclassifications and tax impact | (7) | 31.7 | ||||||
Tax benefit | 0.8 | (7) | ||||||
Other comprehensive (loss) income, net of tax, before reclassifications | (6.2) | 24.7 | ||||||
Amounts reclassified from accumulated other comprehensive income, net of tax | 0 | 0 | ||||||
Total other comprehensive income (loss), net of tax | (6.2) | 24.7 | ||||||
Ending Balance | (106.9) | (86.7) | (106.9) | (86.7) | ||||
Pension Liability Gain (Loss) | ||||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||||
Beginning Balance | $ (120.1) | $ (83.2) | (120.1) | (83.2) | ||||
Other comprehensive (loss) income before reclassifications and tax impact | 0 | 0 | ||||||
Tax benefit | 0 | 0 | ||||||
Other comprehensive (loss) income, net of tax, before reclassifications | 0 | 0 | ||||||
Amounts reclassified from accumulated other comprehensive income, net of tax | 4.7 | 2.7 | ||||||
Total other comprehensive income (loss), net of tax | 4.7 | 2.7 | ||||||
Ending Balance | $ (115.4) | $ (80.5) | $ (115.4) | $ (80.5) |
EARNINGS PER COMMON SHARE - EAR
EARNINGS PER COMMON SHARE - EARNINGS PER SHARE COMPUTATION (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Basic Earnings Per Common Share Computation | ||||
Net income (loss) attributable to Dentsply Sirona | $ 53.8 | $ 85 | $ (181.5) | $ 160.6 |
Weighted average common shares outstanding (in shares) | 218.5 | 223.1 | 219.4 | 223.5 |
Earnings (loss) per common share - basic (in dollars per share) | $ 0.25 | $ 0.38 | $ (0.83) | $ 0.72 |
Diluted Earnings Per Common Share Computation | ||||
Net income (loss) attributable to Dentsply Sirona | $ 53.8 | $ 85 | $ (181.5) | $ 160.6 |
Weighted average common shares outstanding (in shares) | 218.5 | 223.1 | 219.4 | 223.5 |
Incremental weighted average shares from assumed exercise of dilutive options from stock-based compensation awards (in shares) | 0.7 | 1.8 | 0 | 1.7 |
Total weighted average diluted shares outstanding (in shares) | 219.2 | 224.9 | 219.4 | 225.2 |
Earnings (loss) per common share - diluted (in dollars per share) | $ 0.25 | $ 0.38 | $ (0.83) | $ 0.71 |
EARNINGS PER COMMON SHARE - ADD
EARNINGS PER COMMON SHARE - ADDITIONAL INFORMATION (Details) - USD ($) | May 12, 2020 | Mar. 09, 2020 | May 12, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 |
Earnings Per Share [Line Items] | |||||||
Potentially dilutive securities excluded from computation of earnings per share, amount (in shares) | 900,000 | ||||||
Antidilutive common stock options not included in the computation of diluted earnings per common share (in shares) | 3,500,000 | 2,500,000 | |||||
Accelerated share repurchases, authorized amount | $ 140,000,000 | ||||||
Accelerated share repurchases, settlement (payment) or receipt | $ 140,000,000 | ||||||
Stock repurchased during period, shares (in shares) | 1,000,000 | 2,700,000 | |||||
Accelerated share repurchases, final price paid per share (in usd per share) | $ 42.12 | ||||||
Arithmetic Average | |||||||
Earnings Per Share [Line Items] | |||||||
Accelerated share repurchases, final price paid per share (in usd per share) | $ 38.88 | ||||||
Common Stock | |||||||
Earnings Per Share [Line Items] | |||||||
Antidilutive common stock options not included in the computation of diluted earnings per common share (in shares) | 3,400,000 | ||||||
Stock Options And Restricted Stock Units | |||||||
Earnings Per Share [Line Items] | |||||||
Antidilutive common stock options not included in the computation of diluted earnings per common share (in shares) | 3,200,000 |
SEGMENT INFORMATION - ADDITIONA
SEGMENT INFORMATION - ADDITIONAL INFORMATION (Details) - segment | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting Information [Line Items] | ||||
Number of operating groups | 2 | |||
Dental Products | ||||
Segment Reporting Information [Line Items] | ||||
Percentage of sales, professional dental products | 91.00% | 92.00% | 89.00% | 92.00% |
SEGMENT INFORMATION - THIRD PAR
SEGMENT INFORMATION - THIRD PARTY NET SALES (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Revenue, Major Customer [Line Items] | ||||
Total net sales | $ 894.8 | $ 962.1 | $ 2,259.7 | $ 2,917.7 |
Technologies & Equipment | ||||
Revenue, Major Customer [Line Items] | ||||
Total net sales | 503.8 | 534.5 | 1,328 | 1,613.7 |
Consumables | ||||
Revenue, Major Customer [Line Items] | ||||
Total net sales | $ 391 | $ 427.6 | $ 931.7 | $ 1,304 |
SEGMENT INFORMATION - SEGMENT A
SEGMENT INFORMATION - SEGMENT ADJUSTED OPERATING INCOME (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Reconciling items expense (income): | ||||
Segment adjusted operating income | $ 81,700,000 | $ 109,500,000 | $ (147,400,000) | $ 224,300,000 |
Goodwill impairment | 0 | 0 | 156,600,000 | 0 |
Interest expense | 14,500,000 | 6,600,000 | 33,500,000 | 23,000,000 |
Interest income | (400,000) | (700,000) | (1,800,000) | (2,000,000) |
Other expense (income), net | 900,000 | (2,900,000) | 3,800,000 | (4,600,000) |
Amortization of intangible assets | 142,600,000 | 142,900,000 | ||
Income (loss) before income taxes | 66,700,000 | 106,500,000 | (182,900,000) | 207,900,000 |
Technologies & Equipment | ||||
Reconciling items expense (income): | ||||
Goodwill impairment | 156,600,000 | |||
Consumables | ||||
Reconciling items expense (income): | ||||
Goodwill impairment | 0 | |||
Operating Segments | ||||
Reconciling items expense (income): | ||||
Segment adjusted operating income | 208,700,000 | 218,500,000 | 360,000,000 | 613,800,000 |
Operating Segments | Technologies & Equipment | ||||
Reconciling items expense (income): | ||||
Segment adjusted operating income | 109,600,000 | 104,700,000 | 216,900,000 | 272,500,000 |
Operating Segments | Consumables | ||||
Reconciling items expense (income): | ||||
Segment adjusted operating income | 99,100,000 | 113,800,000 | 143,100,000 | 341,300,000 |
All Other | ||||
Reconciling items expense (income): | ||||
All Other | 57,900,000 | 54,700,000 | 141,100,000 | 173,300,000 |
Segment Reconciling Items | ||||
Reconciling items expense (income): | ||||
Goodwill impairment | 0 | 0 | 156,600,000 | 0 |
Restructuring and other costs | 18,700,000 | 5,200,000 | 62,500,000 | 68,100,000 |
Interest expense | 14,500,000 | 6,600,000 | 33,500,000 | 23,000,000 |
Interest income | (400,000) | (700,000) | (1,800,000) | (2,000,000) |
Other expense (income), net | 900,000 | (2,900,000) | 3,800,000 | (4,600,000) |
Amortization of intangible assets | 48,800,000 | 47,400,000 | 142,600,000 | 142,900,000 |
Depreciation resulting from the fair value step-up of property, plant, and equipment from business combinations | $ 1,600,000 | $ 1,700,000 | $ 4,600,000 | $ 5,200,000 |
INVENTORIES - ADDITIONAL INFORM
INVENTORIES - ADDITIONAL INFORMATION (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
LIFO inventory amount | $ 5.9 | $ 5 |
Inventory, LIFO reserve | 20.4 | 14.3 |
Inventory valuation reserve | $ 125.6 | $ 85 |
INVENTORIES - SUMMARY OF INVENT
INVENTORIES - SUMMARY OF INVENTORY (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 282 | $ 356.4 |
Work-in-process | 75 | 82.5 |
Raw materials and supplies | 132.1 | 122.8 |
Inventories, net | $ 489.1 | $ 561.7 |
RESTRUCTURING AND OTHER COSTS -
RESTRUCTURING AND OTHER COSTS - ADDITIONAL INFORMATION (Details) - USD ($) | Aug. 06, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs and asset impairment charges | $ 52,300,000 | $ 7,300,000 | $ 95,500,000 | $ 117,700,000 | |
Restructuring and related cost, accelerated depreciation | 8,400,000 | 9,100,000 | |||
Severance costs | 15,700,000 | 1,900,000 | 20,600,000 | 29,300,000 | |
Asset impairment charges | 2,200,000 | 3,800,000 | 41,000,000 | 41,800,000 | |
August 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring, incurred cost | (48,000,000) | ||||
Minimum | August 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost | $ 70,000,000 | ||||
Maximum | August 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, expected cost | $ 80,000,000 | ||||
Inventory Write-Down | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring costs and asset impairment charges | 24,500,000 | $ 2,500,000 | $ 24,600,000 | $ 19,500,000 | |
Inventory Write-Down | August 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring, incurred cost | (25,000,000) | ||||
Fixed Asset Depreciation | August 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring, incurred cost | (8,000,000) | ||||
Severance | August 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring, incurred cost | $ (13,000,000) | ||||
Facility Closing | Minimum | August 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, number of positions eliminated, period percent | 4.00% | ||||
Facility Closing | Maximum | August 2020 Plan | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and related cost, number of positions eliminated, period percent | 5.00% |
RESTRUCTURING AND OTHER COSTS_2
RESTRUCTURING AND OTHER COSTS - CONSOLIDATED STATEMENTS OF OPERATIONS (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs and Asset Impairment Charges | $ 52.3 | $ 7.3 | $ 95.5 | $ 117.7 |
Cost of products sold | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs and Asset Impairment Charges | 32.3 | 3.6 | 32.7 | 24.3 |
Selling, general, and administrative expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs and Asset Impairment Charges | 1.3 | (1.1) | 0.6 | 20.3 |
Restructuring and other costs | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs and Asset Impairment Charges | 18.7 | 5.2 | 62.5 | 68.1 |
Other income and expenses | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring Costs and Asset Impairment Charges | $ 0 | $ (0.4) | $ (0.3) | $ 5 |
RESTRUCTURING AND OTHER COSTS_3
RESTRUCTURING AND OTHER COSTS - RESTRUCTURING ACCURALS (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Restructuring Reserve [Roll Forward] | ||||
Restructuring and other costs | $ 18.7 | $ 5.2 | $ 62.5 | $ 68.1 |
2020 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 30 | |||
Restructuring and other costs | 23.5 | |||
Amounts applied | 13.5 | |||
Change in estimates | (4.2) | |||
Ending Balance | 35.8 | 35.8 | ||
Severance | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 27 | |||
Restructuring and other costs | 21.9 | |||
Amounts applied | 12.4 | |||
Change in estimates | (4.1) | |||
Ending Balance | 32.4 | 32.4 | ||
Severance | 2018 and Prior Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 7.2 | |||
Restructuring and other costs | 1.1 | |||
Amounts applied | 3.2 | |||
Change in estimates | (0.5) | |||
Ending Balance | 4.6 | 4.6 | ||
Severance | 2019 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 19.8 | |||
Restructuring and other costs | 1.5 | |||
Amounts applied | 7.4 | |||
Change in estimates | (3.6) | |||
Ending Balance | 10.3 | 10.3 | ||
Severance | 2020 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Restructuring and other costs | 19.3 | |||
Amounts applied | 1.8 | |||
Change in estimates | 0 | |||
Ending Balance | 17.5 | 17.5 | ||
Lease/Contract Terminations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0.5 | |||
Restructuring and other costs | 0.7 | |||
Amounts applied | 0.5 | |||
Ending Balance | 0.7 | 0.7 | ||
Lease/Contract Terminations | 2018 and Prior Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0.5 | |||
Restructuring and other costs | 0.4 | |||
Amounts applied | 0.4 | |||
Ending Balance | 0.5 | 0.5 | ||
Lease/Contract Terminations | 2020 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Restructuring and other costs | 0.3 | |||
Amounts applied | 0.1 | |||
Ending Balance | 0.2 | 0.2 | ||
Other Restructuring Costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 2.5 | |||
Restructuring and other costs | 0.9 | |||
Amounts applied | 0.6 | |||
Change in estimates | (0.1) | |||
Ending Balance | 2.7 | 2.7 | ||
Other Restructuring Costs | 2018 and Prior Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 2.2 | |||
Restructuring and other costs | 0 | |||
Amounts applied | 0 | |||
Change in estimates | 0 | |||
Ending Balance | 2.2 | 2.2 | ||
Other Restructuring Costs | 2019 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0.3 | |||
Restructuring and other costs | 0.5 | |||
Amounts applied | 0.7 | |||
Change in estimates | (0.1) | |||
Ending Balance | 0 | 0 | ||
Other Restructuring Costs | 2020 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Restructuring and other costs | 0.4 | |||
Amounts applied | 0.1 | |||
Change in estimates | 0 | |||
Ending Balance | $ 0.5 | $ 0.5 |
RESTRUCTURING AND OTHER COSTS_4
RESTRUCTURING AND OTHER COSTS - PROVISIONS AND ADJUSTMENTS AND AMOUNTS APPLIED FOR ALL PLANS BY SEGMENT (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Restructuring Reserve [Roll Forward] | ||||
Restructuring and other costs | $ 18.7 | $ 5.2 | $ 62.5 | $ 68.1 |
2020 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 30 | |||
Restructuring and other costs | 23.5 | |||
Amounts applied | (13.5) | |||
Change in estimates | (4.2) | |||
Ending Balance | 35.8 | 35.8 | ||
Operating Segments | Technologies & Equipment | 2020 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 19.1 | |||
Restructuring and other costs | 16.3 | |||
Amounts applied | (8) | |||
Change in estimates | (4) | |||
Ending Balance | 23.4 | 23.4 | ||
Operating Segments | Consumables | 2020 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 11.4 | |||
Restructuring and other costs | 4.5 | |||
Amounts applied | (3.9) | |||
Change in estimates | (0.1) | |||
Ending Balance | 11.9 | 11.9 | ||
All Other | 2020 Plans | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | (0.5) | |||
Restructuring and other costs | 2.7 | |||
Amounts applied | (1.6) | |||
Change in estimates | (0.1) | |||
Ending Balance | $ 0.5 | $ 0.5 |
FINANCIAL INSTRUMENTS AND DER_3
FINANCIAL INSTRUMENTS AND DERIVATIVES - CASH FLOW HEDGES (Details) - Cash Flow Hedging - Designated as Hedging Instrument $ in Millions | Sep. 30, 2020USD ($) |
Derivative [Line Items] | |
Derivative, notional amount | $ 325.6 |
Aggregate Notional Amount Maturing within 12 Months | 236.9 |
Foreign exchange forward contracts | |
Derivative [Line Items] | |
Derivative, notional amount | 325.6 |
Aggregate Notional Amount Maturing within 12 Months | $ 236.9 |
FINANCIAL INSTRUMENTS AND DER_4
FINANCIAL INSTRUMENTS AND DERIVATIVES - GAIN (LOSS) ON AOCI (Details) - Designated as Hedging Instrument - USD ($) $ in Millions | Apr. 07, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 |
Cash Flow Hedging | |||||
Derivative [Line Items] | |||||
Gain (Loss) in AOCI | $ (18.8) | $ (18.6) | |||
Effective Portion Reclassified from AOCI into Income (Expense) | (0.4) | (1.4) | |||
Ineffective Portion Recognized in Income (Expense) | 2.2 | 1.5 | |||
Cash Flow Hedging | Foreign exchange forward contracts | Cost of products sold | |||||
Derivative [Line Items] | |||||
Gain (Loss) in AOCI | (1.7) | (4) | |||
Effective Portion Reclassified from AOCI into Income (Expense) | 2.2 | 0.4 | |||
Ineffective Portion Recognized in Income (Expense) | 2.2 | 1.5 | |||
Cash Flow Hedging | Interest rate swaps | Interest expense | |||||
Derivative [Line Items] | |||||
Gain (Loss) in AOCI | (17.1) | (14.6) | |||
Effective Portion Reclassified from AOCI into Income (Expense) | (2.6) | (1.8) | |||
Net Investment Hedging | |||||
Derivative [Line Items] | |||||
Gain (Loss) in AOCI | $ (16.8) | $ 37.9 | (7) | 44.8 | |
Effective Portion Reclassified from AOCI into Income (Expense) | $ 48.1 | ||||
Recognized in Income (Expense) | 2 | 8.3 | 12.6 | 22 | |
Net Investment Hedging | Foreign exchange forward contracts | |||||
Derivative [Line Items] | |||||
Gain (Loss) in AOCI | 25.5 | ||||
Net Investment Hedging | Foreign exchange forward contracts | Other expense (income), net | |||||
Derivative [Line Items] | |||||
Gain (Loss) in AOCI | 6.4 | 31.7 | |||
Recognized in Income (Expense) | 6.1 | 6.2 | 15.7 | ||
Net Investment Hedging | Cross currency basis swaps | |||||
Derivative [Line Items] | |||||
Gain (Loss) in AOCI | 12.4 | ||||
Net Investment Hedging | Cross currency basis swaps | Interest expense | |||||
Derivative [Line Items] | |||||
Gain (Loss) in AOCI | (16.8) | (13.4) | 13.1 | ||
Recognized in Income (Expense) | $ 2 | $ 6.4 | $ 6.3 | ||
Net Investment Hedging | Cross currency basis swaps | Interest Income | |||||
Derivative [Line Items] | |||||
Recognized in Income (Expense) | $ 2.2 |
FINANCIAL INSTRUMENTS AND DER_5
FINANCIAL INSTRUMENTS AND DERIVATIVES - ADDITIONAL INFORMATION (Details) - USD ($) | May 26, 2020 | Apr. 07, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Mar. 11, 2019 |
Senior Notes | Senior Unsecured Notes Maturing June 1, 2030 | |||||
Derivative [Line Items] | |||||
Debt instrument, face amount | $ 750,000,000 | ||||
Foreign exchange forward contracts | |||||
Derivative [Line Items] | |||||
Derivative, term of contract | 18 months | ||||
Net Investment Hedging | Designated as Hedging Instrument | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | $ 308,600,000 | ||||
Effective portion reclassified from AOCI into income (expense) | $ 48,100,000 | ||||
Cash Flow Hedging | Treasury Lock | |||||
Derivative [Line Items] | |||||
Repayments of debt | $ 30,500,000 | ||||
Derivative, notional amount | $ 150,000,000 | ||||
Long-term debt, term | 10 years | ||||
Term of loan | 10 years | ||||
Cash Flow Hedging | Treasury Lock | Senior Unsecured Notes Maturing June 1, 2030 | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | $ 150,000,000 | ||||
Cash Flow Hedging | Designated as Hedging Instrument | |||||
Derivative [Line Items] | |||||
Derivative, notional amount | 325,600,000 | ||||
Effective portion reclassified from AOCI into income (expense) | $ (400,000) | $ (1,400,000) |
FINANCIAL INSTRUMENTS AND DER_6
FINANCIAL INSTRUMENTS AND DERIVATIVES - NET INVESTMENT HEDGES (Details) $ in Millions | Sep. 30, 2020USD ($) |
Net Investment Hedging | Designated as Hedging Instrument | |
Derivative [Line Items] | |
Derivative, notional amount | $ 308.6 |
Aggregate Notional Amount Maturing within 12 Months | 308.6 |
Net Investment Hedging | Designated as Hedging Instrument | Cross currency basis swaps | |
Derivative [Line Items] | |
Derivative, notional amount | 308.6 |
Aggregate Notional Amount Maturing within 12 Months | 308.6 |
Fair Value Hedging | |
Derivative [Line Items] | |
Derivative, notional amount | 98.3 |
Aggregate Notional Amount Maturing within 12 Months | 70.2 |
Fair Value Hedging | Foreign exchange forward contracts | |
Derivative [Line Items] | |
Derivative, notional amount | 98.3 |
Aggregate Notional Amount Maturing within 12 Months | $ 70.2 |
FINANCIAL INSTRUMENTS AND DER_7
FINANCIAL INSTRUMENTS AND DERIVATIVES - HEDGES NOT DESIGNATED (Details) - Not Designated as Hedging Instrument $ in Millions | Sep. 30, 2020USD ($) |
Derivative [Line Items] | |
Derivative, notional amount | $ 226.2 |
Aggregate Notional Amount Maturing within 12 Months | 226.2 |
Foreign exchange forward contracts | |
Derivative [Line Items] | |
Derivative, notional amount | 226.2 |
Aggregate Notional Amount Maturing within 12 Months | $ 226.2 |
CONSOLIDATED BALANCE SHEETS LOC
CONSOLIDATED BALANCE SHEETS LOCATION OF DERIVATIVE FAIR VALUES (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Derivative [Line Items] | ||
Derivative asset, fair value, gross | $ 4.3 | $ 45.7 |
Derivative liability, fair value, gross | 10.9 | 14 |
Interest rate swaps | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 10.8 | |
Cross currency basis swaps | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 6.9 | |
Derivative liability, fair value, gross | $ 6.5 | |
Prepaid Expenses and Other Current Assets | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 26.9 | |
Prepaid Expenses and Other Current Assets | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 2 | |
Prepaid Expenses and Other Current Assets | Foreign exchange forward contracts | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 26.9 | |
Prepaid Expenses and Other Current Assets | Foreign exchange forward contracts | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 2 | |
Prepaid Expenses and Other Current Assets | Interest rate swaps | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 0 | |
Prepaid Expenses and Other Current Assets | Cross currency basis swaps | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 0 | |
Other Noncurrent Assets | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 18.2 | |
Other Noncurrent Assets | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 0 | |
Other Noncurrent Assets | Foreign exchange forward contracts | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 11.3 | |
Other Noncurrent Assets | Foreign exchange forward contracts | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 0 | |
Other Noncurrent Assets | Interest rate swaps | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 0 | |
Other Noncurrent Assets | Cross currency basis swaps | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross | 6.9 | |
Accrued Liabilities | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 1.3 | |
Accrued Liabilities | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 1.5 | |
Accrued Liabilities | Foreign exchange forward contracts | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 1.3 | |
Accrued Liabilities | Foreign exchange forward contracts | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 1.5 | |
Accrued Liabilities | Interest rate swaps | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 0 | |
Accrued Liabilities | Cross currency basis swaps | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 0 | |
Other Noncurrent Liabilities | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 12.6 | |
Other Noncurrent Liabilities | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 0 | |
Other Noncurrent Liabilities | Foreign exchange forward contracts | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 1.8 | |
Other Noncurrent Liabilities | Foreign exchange forward contracts | Not Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 0 | |
Other Noncurrent Liabilities | Interest rate swaps | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | 10.8 | |
Other Noncurrent Liabilities | Cross currency basis swaps | Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross | $ 0 |
FINANCIAL INSTRUMENTS AND DER_8
FINANCIAL INSTRUMENTS AND DERIVATIVES - BALANCE SHEET OFFSETTING (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Assets | ||
Gross Amounts Recognized | $ 4.3 | $ 45.7 |
Gross Amount Offset in the Consolidated Balance Sheets | 0 | 0 |
Net Amounts Presented in the Consolidated Balance Sheets | 4.3 | 45.7 |
Financial Instruments | (2.5) | (8.7) |
Cash Collateral Received/Pledged | 0 | 0 |
Net Amount | 1.8 | 37 |
Liabilities | ||
Derivative liability, fair value, gross | 10.9 | 14 |
Gross Amount Offset in the Consolidated Balance Sheets | 0 | 0 |
Net Amounts Presented in the Consolidated Balance Sheets | 10.9 | 14 |
Financial Instruments | (2.5) | (8.7) |
Cash Collateral Received/Pledged | 0 | 0 |
Net Amount | 8.4 | 5.3 |
Foreign exchange forward contracts | ||
Assets | ||
Gross Amounts Recognized | 4.3 | 38.8 |
Gross Amount Offset in the Consolidated Balance Sheets | 0 | 0 |
Net Amounts Presented in the Consolidated Balance Sheets | 4.3 | 38.8 |
Financial Instruments | (2.5) | (7.8) |
Cash Collateral Received/Pledged | 0 | 0 |
Net Amount | 1.8 | 31 |
Liabilities | ||
Derivative liability, fair value, gross | 4.4 | 3.2 |
Gross Amount Offset in the Consolidated Balance Sheets | 0 | 0 |
Net Amounts Presented in the Consolidated Balance Sheets | 4.4 | 3.2 |
Financial Instruments | 0 | (3) |
Cash Collateral Received/Pledged | 0 | 0 |
Net Amount | 4.4 | 0.2 |
Cross currency basis swaps | ||
Assets | ||
Gross Amounts Recognized | 6.9 | |
Gross Amount Offset in the Consolidated Balance Sheets | 0 | |
Net Amounts Presented in the Consolidated Balance Sheets | 6.9 | |
Financial Instruments | (0.9) | |
Cash Collateral Received/Pledged | 0 | |
Net Amount | 6 | |
Liabilities | ||
Derivative liability, fair value, gross | 6.5 | |
Gross Amount Offset in the Consolidated Balance Sheets | 0 | |
Net Amounts Presented in the Consolidated Balance Sheets | 6.5 | |
Financial Instruments | (2.5) | |
Cash Collateral Received/Pledged | 0 | |
Net Amount | $ 4 | |
Interest rate swaps | ||
Liabilities | ||
Derivative liability, fair value, gross | 10.8 | |
Gross Amount Offset in the Consolidated Balance Sheets | 0 | |
Net Amounts Presented in the Consolidated Balance Sheets | 10.8 | |
Financial Instruments | (5.7) | |
Cash Collateral Received/Pledged | 0 | |
Net Amount | $ 5.1 |
FAIR VALUE MEASUREMENT - ADDITI
FAIR VALUE MEASUREMENT - ADDITIONAL INFORMATION (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Estimate of Fair Value, Fair Value Disclosure | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term Debt, Fair Value | $ 2,298.5 | $ 1,440.8 |
Carrying (Reported) Amount, Fair Value Disclosure | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term Debt, Fair Value | $ 2,226.1 | $ 1,433.3 |
FAIR VALUE MEASUREMENT - ASSETS
FAIR VALUE MEASUREMENT - ASSETS AND LIABILITIES, RECURRING (Details) - Fair Value, Recurring - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | $ 4.3 | $ 47.1 |
Liabilities | 16.5 | 24.1 |
Foreign exchange forward contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 4.3 | 40.2 |
Liabilities | 4.3 | 4.6 |
Cross currency basis swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 6.9 | |
Liabilities | 6.5 | |
Interest rate swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liabilities | 10.8 | |
Contingent considerations on acquisitions | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liabilities | 5.7 | 8.7 |
Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 1 | Foreign exchange forward contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 1 | Cross currency basis swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 0 | |
Liabilities | 0 | |
Level 1 | Interest rate swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liabilities | 0 | |
Level 1 | Contingent considerations on acquisitions | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liabilities | 0 | 0 |
Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 4.3 | 47.1 |
Liabilities | 10.8 | 15.4 |
Level 2 | Foreign exchange forward contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 4.3 | 40.2 |
Liabilities | 4.3 | 4.6 |
Level 2 | Cross currency basis swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 6.9 | |
Liabilities | 6.5 | |
Level 2 | Interest rate swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liabilities | 10.8 | |
Level 2 | Contingent considerations on acquisitions | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liabilities | 0 | 0 |
Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 0 | 0 |
Liabilities | 5.7 | 8.7 |
Level 3 | Foreign exchange forward contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 3 | Cross currency basis swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Assets | 0 | |
Liabilities | 0 | |
Level 3 | Interest rate swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liabilities | 0 | |
Level 3 | Contingent considerations on acquisitions | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Liabilities | $ 5.7 | $ 8.7 |
INCOME TAXES - ADDITIONAL INFOR
INCOME TAXES - ADDITIONAL INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||
Tax expense for other discrete tax matters | $ 1.8 | |
Tax benefit related to valuation allowances | $ 5 |
FINANCING ARRANGEMENTS (Details
FINANCING ARRANGEMENTS (Details) | Jun. 11, 2020JPY (¥) | May 26, 2020USD ($) | May 12, 2020EUR (€) | May 05, 2020EUR (€) | Apr. 17, 2020USD ($) | Apr. 09, 2020USD ($) | Dec. 31, 2020 | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Mar. 11, 2019USD ($) |
Line of Credit Facility [Line Items] | ||||||||||
Borrowings available under lines of credit | $ 1,161,100,000 | |||||||||
Cash paid on derivative contracts | $ 30,500,000 | $ 0 | ||||||||
Treasury Lock | Cash Flow Hedging | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Term of loan | 10 years | |||||||||
Notional amount | $ 150,000,000 | |||||||||
Treasury Lock | Cash Flow Hedging | Senior Unsecured Notes Maturing June 1, 2030 | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Cash paid on derivative contracts | $ 30,500,000 | |||||||||
Notional amount | 150,000,000 | |||||||||
Notes Payable to Banks | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Maximum borrowing capacity | ¥ 3,300,000,000 | € 30,000,000 | € 40,000,000 | $ 310,000,000 | ||||||
Term of loan | 364 days | 364 days | 364 days | 364 days | ||||||
Line of Credit | Revolving Credit Facility | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Term of loan | 5 years | |||||||||
Line of Credit | 2018 Revolving Credit Facility | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Maximum borrowing capacity | $ 700,000,000 | |||||||||
Proceeds from long-term lines of credit | $ 700,000,000 | |||||||||
Repayments of long-term lines of credit | 700,000,000 | |||||||||
Line of Credit | 2018 Revolving Credit Facility | Forecast | London Interbank Offered Rate (LIBOR) | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt instrument, basis spread on variable rate | 1.25% | |||||||||
Line of Credit | Commercial paper | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Maximum borrowing capacity | $ 500,000,000 | |||||||||
Senior Notes | Senior Unsecured Notes Maturing June 1, 2030 | ||||||||||
Line of Credit Facility [Line Items] | ||||||||||
Debt instrument, face amount | $ 750,000,000 | |||||||||
Debt instrument, interest rate, stated percentage | 3.25% | |||||||||
Proceeds from issuance of unsecured debt | $ 748,400,000 | |||||||||
Debt instrument, unamortized discount | 1,600,000 | |||||||||
Debt issuance costs, gross | $ 6,400,000 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - NARRATIVE (Details) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2020USD ($) | Mar. 31, 2020USD ($)reporting_unit | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($)reportingUnit | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($) | |
Goodwill [Line Items] | ||||||
Number of reporting units | reportingUnit | 5 | |||||
Goodwill impairment | $ 0 | $ 0 | $ 156,600,000 | $ 0 | ||
Goodwill | 3,282,700,000 | 3,282,700,000 | $ 3,396,500,000 | |||
Indefinite-lived intangible asset impairment | $ 38,700,000 | 5,300,000 | ||||
COVID-19 | ||||||
Goodwill [Line Items] | ||||||
Number of reporting units | reporting_unit | 4 | |||||
Minimum | Measurement Input, Discount Rate | ||||||
Goodwill [Line Items] | ||||||
Goodwill measurement input | 0.090 | |||||
Minimum | Measurement Input, Discount Rate | COVID-19 | ||||||
Goodwill [Line Items] | ||||||
Goodwill measurement input | 0.095 | |||||
Intangible asset, measurement input | 0.100 | |||||
Maximum | Measurement Input, Discount Rate | ||||||
Goodwill [Line Items] | ||||||
Goodwill measurement input | 0.115 | |||||
Maximum | Measurement Input, Discount Rate | COVID-19 | ||||||
Goodwill [Line Items] | ||||||
Goodwill measurement input | 0.115 | |||||
Intangible asset, measurement input | 0.175 | |||||
Equipment and Instruments Reporting Unit | ||||||
Goodwill [Line Items] | ||||||
Goodwill | 291,500,000 | $ 291,500,000 | ||||
Reporting Unit Within The Technologies And Equipment Segment | ||||||
Goodwill [Line Items] | ||||||
Goodwill | 1,200,000,000 | 1,200,000,000 | ||||
Technologies & Equipment | ||||||
Goodwill [Line Items] | ||||||
Goodwill impairment | 156,600,000 | |||||
Goodwill | $ 2,403,400,000 | $ 2,403,400,000 | $ 2,515,700,000 | |||
Indefinite-lived intangible asset impairment | $ 5,300,000 | |||||
Technologies & Equipment | Equipment and Instruments Reporting Unit | COVID-19 | ||||||
Goodwill [Line Items] | ||||||
Goodwill impairment | $ 156,600,000 | |||||
Goodwill | 290,500,000 | |||||
Indefinite-lived intangible asset impairment | 38,700,000 | |||||
Indefinite-lived tradenames and trademarks | $ 75,000,000 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - RECONCILIATION OF CHANGES IN GOODWILL (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Goodwill [Roll Forward] | ||||
Balance, beginning of the year | $ 3,396,500,000 | |||
Impairment | $ 0 | $ 0 | (156,600,000) | $ 0 |
Effects of exchange rate changes | 42,800,000 | |||
Balance, end of the year | 3,282,700,000 | 3,282,700,000 | ||
Technologies & Equipment | ||||
Goodwill [Roll Forward] | ||||
Balance, beginning of the year | 2,515,700,000 | |||
Impairment | (156,600,000) | |||
Effects of exchange rate changes | 44,300,000 | |||
Balance, end of the year | 2,403,400,000 | 2,403,400,000 | ||
Consumables | ||||
Goodwill [Roll Forward] | ||||
Balance, beginning of the year | 880,800,000 | |||
Impairment | 0 | |||
Effects of exchange rate changes | (1,500,000) | |||
Balance, end of the year | $ 879,300,000 | $ 879,300,000 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - GOODWILL CARRYING AMOUNT (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Goodwill [Line Items] | ||
Gross Carrying Amount | $ 6,175.8 | $ 6,133.1 |
Cumulative Impairment | (2,893.1) | (2,736.6) |
Net Carrying Amount | 3,282.7 | 3,396.5 |
Technologies & Equipment | ||
Goodwill [Line Items] | ||
Gross Carrying Amount | 5,296.5 | 5,252.3 |
Cumulative Impairment | (2,893.1) | (2,736.6) |
Net Carrying Amount | 2,403.4 | 2,515.7 |
Consumables | ||
Goodwill [Line Items] | ||
Gross Carrying Amount | 879.3 | 880.8 |
Cumulative Impairment | 0 | 0 |
Net Carrying Amount | $ 879.3 | $ 880.8 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS - IDENTIFIABLE DEFINITE-LIVED AND INDEFINITE-LIVED INTANGIBLE ASSETS (Details) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 2,629.5 | $ 2,557.4 |
Accumulated Amortization | (1,182.6) | (1,008.4) |
Net Carrying Amount | 1,446.9 | 1,549 |
Intangible Assets, Gross (Excluding Goodwill) | 3,240.7 | 3,184.7 |
Identifiable intangible assets, net | 2,058.1 | 2,176.3 |
Tradenames and trademarks | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived tradenames and trademarks | 611.2 | 627.3 |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,420.3 | 1,371.9 |
Accumulated Amortization | (623.5) | (517.9) |
Net Carrying Amount | 796.8 | 854 |
Tradenames and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 81.3 | 79 |
Accumulated Amortization | (68.2) | (63.4) |
Net Carrying Amount | 13.1 | 15.6 |
Licensing agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 36.4 | 36 |
Accumulated Amortization | (29.4) | (27.9) |
Net Carrying Amount | 7 | 8.1 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,091.5 | 1,070.5 |
Accumulated Amortization | (461.5) | (399.2) |
Net Carrying Amount | $ 630 | $ 671.3 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | Apr. 29, 2019stockholder | Jan. 11, 2018 | Sep. 30, 2020USD ($) | Dec. 31, 2013USD ($) | Jun. 07, 2018performancePeriod |
Loss Contingencies [Line Items] | |||||
Employment agreement terms minimum period of employment | 8 years | ||||
Number of class action lawsuits | performancePeriod | 2 | ||||
Number of distributors | performancePeriod | 3 | ||||
Loss contingency, number of plaintiffs | stockholder | 2 | ||||
Income tax effects allocated directly to equity, employee stock options | $ 546,000,000 | ||||
Swedish Tax Agency | |||||
Loss Contingencies [Line Items] | |||||
Income Tax Examination, Estimate of Possible Loss | $ 56,000,000 | ||||
Tax Year 2012 | IRS | |||||
Loss Contingencies [Line Items] | |||||
Liability (refund) from income tax examination | (4,700,000) | ||||
Tax Year 2013 | IRS | |||||
Loss Contingencies [Line Items] | |||||
Liability (refund) from income tax examination | 0 | ||||
Tax Year 2014 | IRS | |||||
Loss Contingencies [Line Items] | |||||
Liability (refund) from income tax examination | $ 17,100,000 |
Subsequent Events (Details)
Subsequent Events (Details) | Oct. 22, 2020USD ($) |
Subsequent Event | |
Subsequent Event [Line Items] | |
Payments to acquire equity method investments | $ 45,000,000 |