Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2024 | Apr. 26, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 1-16191 | |
Entity Registrant Name | TENNANT CO | |
Entity Incorporation, State or Country Code | MN | |
Entity Tax Identification Number | 41-0572550 | |
Entity Address, Address Line One | 10400 Clean Street | |
Entity Address, City or Town | Eden Prairie | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55344 | |
City Area Code | 763 | |
Local Phone Number | 540-1200 | |
Title of 12(b) Security | Common Stock, par value $0.375 per share | |
Trading Symbol | TNC | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 19,007,460 | |
Entity Central Index Key | 0000097134 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Net sales | $ 311 | $ 305.8 |
Cost of sales | 173.5 | 180.3 |
Gross profit | 137.5 | 125.5 |
Selling and administrative expense | 89.9 | 81.7 |
Research and development expense | 10.1 | 7.9 |
Operating income | 37.5 | 35.9 |
Interest expense, net | (2.3) | (3.7) |
Net foreign currency transaction loss | (0.2) | (0.1) |
Other income (expense), net | 0.1 | (0.1) |
Income before income taxes | 35.1 | 32 |
Income tax expense | 6.7 | 7.7 |
Net income | $ 28.4 | $ 24.3 |
Net income per share | ||
Basic (in dollars per share) | $ 1.52 | $ 1.32 |
Diluted (in dollars per share) | $ 1.49 | $ 1.30 |
Weighted average shares outstanding | ||
Basic (in shares) | 18,665,570 | 18,449,430 |
Diluted (in shares) | 19,077,767 | 18,682,268 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 28.4 | $ 24.3 |
Other comprehensive (loss) income: | ||
Foreign currency translation adjustments (net of related tax (expense) benefit of $(0.2) and $0.1, respectively) | (8.2) | 5.3 |
Derivative financial instruments (net of related tax (expense) benefit of $(0.3), $0.2, respectively) | 1 | (0.6) |
Total other comprehensive (loss) income, net of tax | (7.2) | 4.7 |
Comprehensive income | $ 21.2 | $ 29 |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parentheticals) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Foreign currency translation adjustments tax (expense) benefit | $ (0.2) | $ 0.1 |
Cash flow hedge tax (expense) benefit, tax | $ (0.3) | $ 0.2 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
ASSETS | ||
Cash, cash equivalents, and restricted cash | $ 88.8 | $ 117.1 |
Receivables, less allowances of $7.1 and $7.2, respectively | 257.3 | 247.6 |
Inventories | 181.4 | 175.9 |
Prepaid and other current assets | 33.6 | 28.5 |
Total current assets | 561.1 | 569.1 |
Property, plant and equipment, less accumulated depreciation of $307.4 and $304.0, respectively | 184.7 | 187.7 |
Operating lease assets | 40.4 | 41.7 |
Goodwill | 192.2 | 187.4 |
Intangible assets, net | 72.3 | 63.1 |
Other assets | 101 | 64.4 |
Total assets | 1,151.7 | 1,113.4 |
LIABILITIES AND EQUITY | ||
Current portion of long-term debt | 7.2 | 6.4 |
Accounts payable | 124.9 | 111.4 |
Employee compensation and benefits | 46.7 | 67.3 |
Other current liabilities | 81.6 | 88.6 |
Total current liabilities | 260.4 | 273.7 |
Long-term debt | 207.4 | 194.2 |
Long-term operating lease liabilities | 27.1 | 27.4 |
Employee benefits | 13.7 | 13.3 |
Deferred income taxes | 8.4 | 5 |
Other liabilities | 18.8 | 21.5 |
Total long-term liabilities | 275.4 | 261.4 |
Total liabilities | 535.8 | 535.1 |
Commitments and contingencies (Note 12) | ||
Common Stock, $0.375 par value; 60,000,000 shares authorized; 19,006,838 and 18,631,384 shares issued and outstanding, respectively | 7.1 | 7 |
Additional paid-in capital | 86.5 | 64.9 |
Retained earnings | 570.5 | 547.4 |
Accumulated other comprehensive loss | (49.5) | (42.3) |
Total Tennant Company shareholders' equity | 614.6 | 577 |
Noncontrolling interest | 1.3 | 1.3 |
Total equity | 615.9 | 578.3 |
Total liabilities and total equity | $ 1,151.7 | $ 1,113.4 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Allowance for credit loss | $ 7.1 | $ 7.2 |
Accumulated depreciation | $ 307.4 | $ 304 |
Common stock, par value (in dollars per share) | $ 0.375 | $ 0.375 |
Common stock, shares authorized (in shares) | 60,000,000 | 60,000,000 |
Common stock, shares issued (in shares) | 19,006,838 | 19,006,838 |
Common stock, shares outstanding (in shares) | 18,631,384 | 18,631,384 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
OPERATING ACTIVITIES | ||
Net income | $ 28.4 | $ 24.3 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation expense | 9.6 | 8.3 |
Amortization expense | 3.9 | 3.9 |
Deferred income tax benefit | (1) | (2) |
Share-based compensation expense | 3.2 | 1.2 |
Bad debt and returns expense | 0.3 | 1 |
Other, net | 0.1 | 0.2 |
Changes in operating assets and liabilities: | ||
Receivables | (10.1) | (2.5) |
Inventories | (9.2) | (1.5) |
Accounts payable | 13.9 | (6.6) |
Employee compensation and benefits | (20.3) | 0.5 |
Other assets and liabilities | (15.9) | 4.3 |
Net cash provided by operating activities | 2.9 | 31.1 |
INVESTING ACTIVITIES | ||
Purchases of property, plant and equipment | (3) | (6.8) |
Purchase of investment | (32.1) | 0 |
Payments made in connection with business acquisition, net of cash acquired | (25.5) | 0 |
Investment in leased assets | (0.2) | (0.2) |
Cash received from leased assets | 0.2 | 0.2 |
Net cash used in investing activities | (60.6) | (6.8) |
FINANCING ACTIVITIES | ||
Proceeds from borrowings | 40 | 20 |
Repayments of borrowings | (26.2) | (21.4) |
Change in finance lease obligations | 0 | 0.2 |
Proceeds from exercise of stock options, net of employee tax withholdings obligations | 19.5 | 0.8 |
Repurchases of common stock | (1.1) | (5) |
Dividends paid | (5.3) | (4.9) |
Net cash provided by (used) in financing activities | 26.9 | (10.3) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 2.5 | 0 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (28.3) | 14 |
Cash, cash equivalents and restricted cash at beginning of period | 117.1 | 77.4 |
Cash, cash equivalents and restricted cash at end of period | 88.8 | 91.4 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Cash paid for income taxes | 1.6 | 0.8 |
Cash paid for interest | 4.5 | 4.5 |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | 4.7 | 4.6 |
Lease assets obtained in exchange for new operating lease liabilities | 3.8 | 4.6 |
Supplemental non-cash investing and financing activities: | ||
Capital expenditures in accounts payable | $ 2.1 | $ 1.5 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions | Total | Tennant Company Shareholders' Equity | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interest |
Beginning balance (in shares) at Dec. 31, 2022 | 18,521,485 | ||||||
Beginning balance at Dec. 31, 2022 | $ 472.1 | $ 470.8 | $ 7 | $ 56 | $ 458 | $ (50.2) | $ 1.3 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 24.3 | 24.3 | 24.3 | ||||
Other comprehensive income (loss) | 4.7 | 4.7 | 4.7 | ||||
Issue stock for directors, employee benefit and stock plans, net of related tax withholdings and repurchases (in shares) | 93,073 | ||||||
Issue stock for directors, employee benefit and stock plans, net of related tax withholdings and repurchases of shares | 0.8 | 0.8 | 0.8 | ||||
Share-based compensation | 1.2 | 1.2 | 1.2 | ||||
Repurchases of common stock (in shares) | (73,525) | ||||||
Repurchases of common stock | (5) | (5) | (5) | ||||
Dividends paid per common share | (4.9) | (4.9) | (4.9) | ||||
Ending balance (in shares) at Mar. 31, 2023 | 18,541,033 | ||||||
Ending balance at Mar. 31, 2023 | $ 493.2 | 491.9 | $ 7 | 53 | 477.4 | (45.5) | 1.3 |
Beginning balance (in shares) at Dec. 31, 2023 | 18,631,384 | 18,631,384 | |||||
Beginning balance at Dec. 31, 2023 | $ 578.3 | 577 | $ 7 | 64.9 | 547.4 | (42.3) | 1.3 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income | 28.4 | 28.4 | 28.4 | ||||
Other comprehensive income (loss) | (7.2) | (7.2) | (7.2) | ||||
Issue stock for directors, employee benefit and stock plans, net of related tax withholdings and repurchases (in shares) | 388,179 | ||||||
Issue stock for directors, employee benefit and stock plans, net of related tax withholdings and repurchases of shares | 19.6 | 19.6 | $ 0.1 | 19.5 | |||
Share-based compensation | 3.2 | 3.2 | 3.2 | ||||
Repurchases of common stock (in shares) | (12,725) | ||||||
Repurchases of common stock | (1.1) | (1.1) | (1.1) | ||||
Dividends paid per common share | $ (5.3) | (5.3) | (5.3) | ||||
Ending balance (in shares) at Mar. 31, 2024 | 18,631,384 | 19,006,838 | |||||
Ending balance at Mar. 31, 2024 | $ 615.9 | $ 614.6 | $ 7.1 | $ 86.5 | $ 570.5 | $ (49.5) | $ 1.3 |
CONSOLIDATED STATEMENTS OF EQ_2
CONSOLIDATED STATEMENTS OF EQUITY (Parentheticals) - $ / shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Stockholders' Equity [Abstract] | ||
Shares withheld for taxes (in shares) | 27,808 | 18,468 |
Dividends paid per common share (in dollars per share) | $ 0.28 | $ 0.265 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Tennant Company ("the Company", "we", "us", or "our") is a world leader in designing, manufacturing and marketing solutions that empower customers to achieve quality cleaning performance, reduce environmental impact and help create a cleaner, safer, healthier world. The Company is committed to creating and commercializing breakthrough, sustainable cleaning innovations to enhance its broad suite of products, including floor maintenance and cleaning equipment, detergent-free and other sustainable cleaning technologies, aftermarket parts and consumables, equipment maintenance and repair service, and asset management solutions. Our products are used in many types of environments, including retail establishments, distribution centers, factories and warehouses, public venues such as arenas and stadiums, office buildings, schools and universities, hospitals and clinics, and more. Customers include contract cleaners to whom organizations outsource facilities maintenance as well as businesses that perform facilities maintenance themselves. The Company reaches these customers through the industry's largest direct sales and service organization and through a strong and well-supported network of authorized distributors worldwide. Basis of Presentation – The accompanying unaudited consolidated financial statements have been prepared in accordance with the U.S. Securities and Exchange Commission (“SEC”) requirements for interim reporting. In our opinion, the consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary for the fair presentation of our financial position and results of operations. These statements should be read in conjunction with the consolidated financial statements and notes included in our annual report on Form 10-K for the year ended December 31, 2023. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. |
Newly Adopted Accounting Pronou
Newly Adopted Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Newly Adopted Accounting Pronouncements | Newly Adopted Accounting Pronouncements There are no newly adopted accounting pronouncements during the three months ended March 31, 2024 that impacted the Company. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregation of Revenue The following tables illustrate the disaggregation of revenue by geographic area, groups of similar products and services and sales channels: Net sales by geographic area Three Months Ended 2024 2023 Americas $ 215.6 $ 204.4 Europe, Middle East and Africa 76.8 82.1 Asia Pacific 18.6 19.3 Total $ 311.0 $ 305.8 Net sales are attributed to each geographic area based on the end-user country and are net of intercompany sales. Net sales by groups of similar products and services Three Months Ended 2024 2023 Equipment $ 189.8 $ 186.4 Parts and consumables 70.6 73.4 Service and other 50.6 46.0 Total $ 311.0 $ 305.8 Net sales by sales channel Three Months Ended 2024 2023 Sales direct to consumer $ 221.4 $ 205.1 Sales to distributors 89.6 100.7 Total $ 311.0 $ 305.8 Contract Liabilities Sales Returns The right of return may exist explicitly or implicitly with our customers. When the right of return exists, we adjust the transaction price for the estimated effect of returns. We estimate the expected returns using the expected value method by assessing historical sales levels and the timing and magnitude of historical sales return levels as a percent of sales and projecting this experience into the future. Sales Incentives Our sales contracts may contain various customer incentives, such as volume-based rebates or other promotions. We reduce the transaction price for certain customer programs and incentive offerings that represent variable consideration. Sales incentives given to our customers are recorded using the most likely amount approach for estimating the amount of consideration to which the Company will be entitled. We forecast the most likely amount of the incentive to be paid at the time of sale, update this forecast quarterly, and adjust the transaction price accordingly to reflect the new amount of incentives expected to be earned by the customer. A majority of our customer incentives are settled within one year. We record our accruals for volume-based rebates and other promotions in other current liabilities on our consolidated balance sheets. The change in our sales incentive accrual balance was as follows: Three Months Ended 2024 2023 Beginning balance $ 21.2 $ 20.0 Additions to sales incentive accrual 6.3 6.6 Contract payments (11.3) (11.3) Foreign currency fluctuations (0.4) 0.1 Ending balance $ 15.8 $ 15.4 Deferred Revenue We sell separately priced prepaid contracts to our customers where we receive payment at the inception of the contract and defer recognition of the consideration received because we have to satisfy future performance obligations. Our deferred revenue balance is primarily attributed to prepaid maintenance contracts on our machines ranging from 12 months to 60 months. In circumstances where prepaid contracts are bundled with machines, we use an observable price to determine stand-alone selling price for separate performance obligations. The change in the deferred revenue balance was as follows: Three Months Ended 2024 2023 Beginning balance $ 10.3 $ 9.3 Increase in deferred revenue representing our obligation to satisfy future performance obligations 5.0 5.5 Decrease in deferred revenue for amounts recognized in net sales for satisfied performance obligations (4.3) (4.7) Foreign currency fluctuations (0.1) 0.1 Ending balance $ 10.9 $ 10.2 At March 31, 2024, $7.1 million and $3.8 million of deferred revenue was reported in other current liabilities and other liabilities, respectively, on our consolidated balance sheets. Of these amounts, we expect to recognize the following approximate amounts in net sales in the following periods: Remaining 2024 $ 6.6 2025 2.1 2026 1.3 2027 0.6 2028 0.2 Thereafter 0.1 Total $ 10.9 At December 31, 2023, $7.9 million and $2.4 million of deferred revenue was reported in other current liabilities and other liabilities, respectively, on our consolidated balance sheets. |
Management Actions
Management Actions | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Management Actions | Management Actions Restructuring Actions During the three months ended March 31, 2024 and March 31, 2023, we incurred no restructuring expenses as part of our ongoing global reorganization efforts. A reconciliation of the beginning and ending liability balances for severance-related costs is as follows: Three Months Ended 2024 2023 Beginning balance $ 2.4 $ 1.7 New charges — — Cash payments (0.4) (0.5) Foreign currency fluctuations (0.1) — Adjustments to accrual — — Ending balance $ 1.9 $ 1.2 |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions On February 29, 2024, we acquired 100% of M&F Management and Financing GmbH ("M&F"), the parent company of TCS EMEA GmbH ("TCS"), as we seek to accelerate growth in the EMEA region. Based in Austria, TCS was Tennant Company's largest Central and Eastern Europe distributor. The acquisition gives Tennant a knowledgeable and experienced sales force and an established direct channel into countries including Romania, Hungary, Czech Republic, and Slovakia, along with an expanded network in Austria, Switzerland, Poland, and other nations in the region, as well as the Middle East and Africa. Our consolidated financial results for the three months ended March 31, 2024 include $2.1 million of revenue and immaterial net income related to TCS. The proforma impact of this acquisition is immaterial to our operations. The purchase price has been preliminarily allocated based on the estimated fair value of assets acquired and liabilities assumed at the date of the acquisition. The preliminary purchase price allocation is subject to further refinement and may require adjustments to arrive at the final purchase price allocation. These changes will primarily relate to the fair value of intangible assets and impacts associated with income taxes. Such finalization may result in material changes from the preliminary purchase price allocation. The following table summarizes the preliminary fair value measurement of the assets acquired and liabilities assumed as of the date of acquisition: Components of purchase price: Cash paid $ 30.8 Settlement of preexisting transactions 3.9 Total purchase price 34.7 ASSETS Cash 5.3 Other current assets 8.0 Intangible assets subject to amortization Customer lists 13.6 Backlog 0.6 Other assets 5.3 Total identifiable assets acquired 32.8 LIABILITIES Current liabilities (1.5) Long-term liabilities (5.0) Total identifiable liabilities assumed (6.5) Net assets acquired 26.3 Goodwill $ 8.4 The total purchase price was paid on the acquisition date of February 29, 2024. Included in the transaction is cash paid of $30.8 million and the settlement of $3.9 million of preexisting transactions. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories are valued at the lower of cost or net realizable value and consisted of the following: March 31, December 31, Inventories carried at LIFO: Finished goods (a) $ 75.4 $ 74.7 Raw materials and work-in-process 37.1 38.5 Excess of FIFO over LIFO cost (b) (47.5) (47.7) Total LIFO inventories $ 65.0 $ 65.5 Inventories carried at FIFO: Finished goods (a) $ 56.9 $ 52.8 Raw materials and work-in-process 59.5 57.6 Total FIFO inventories $ 116.4 $ 110.4 Total inventories $ 181.4 $ 175.9 (a) Finished goods include machines, parts and consumables and component parts that are used in our products. (b) The difference between replacement cost and the stated LIFO inventory value is not materially different from the reserve for the LIFO valuation method. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The changes in the carrying amount of goodwill for the three months ended March 31, 2024 were as follows: Goodwill Accumulated Impairment Losses Total Balance as of December 31, 2023 $ 220.7 $ (33.3) $ 187.4 Additions 8.4 — 8.4 Foreign currency fluctuations (3.9) 0.3 (3.6) Balance as of March 31, 2024 $ 225.2 $ (33.0) $ 192.2 The balances of acquired intangible assets, excluding goodwill, were as follows: Customer Lists Trade Names Technology Total Balance as of March 31, 2024 Original cost $ 161.7 $ 28.7 $ 16.1 $ 206.5 Accumulated amortization (101.5) (19.5) (13.2) (134.2) Carrying value $ 60.2 $ 9.2 $ 2.9 $ 72.3 Weighted average original life (in years) 14 10 12 Balance as of December 31, 2023 Original cost $ 150.6 $ 29.3 $ 16.3 $ 196.2 Accumulated amortization (100.8) (19.2) (13.1) (133.1) Carrying value $ 49.8 $ 10.1 $ 3.2 $ 63.1 Weighted average original life (in years) 15 11 11 The additions to Goodwill recorded during the first quarter of 2024 were related to our acquisition of TCS, as described further in Note 5. As part of our acquisition of TCS, we acquired customer lists and backlog with a combined preliminary fair value of $14.2 million. Further details regarding the preliminary purchase price allocation of TCS are described further in Note 5. Amortization expense on intangible assets for the three months ended March 31, 2024 and March 31, 2023 was $3.9 million. Estimated aggregate amortization expense based on the current carrying value of amortizable intangible assets for each of the five succeeding years and thereafter is as follows: Remaining 2024 $ 11.2 2025 13.1 2026 11.9 2027 8.6 2028 6.9 Thereafter 20.6 Total $ 72.3 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Debt | Debt 2021 Credit Agreement On April 5, 2021, we and certain of our foreign subsidiaries entered into an Amended and Restated Credit Agreement (the “2021 Credit Agreement”) with JPMorgan Chase Bank, N.A. as administrative agent. The 2021 Credit Agreement provides us and certain of our foreign subsidiaries access to a senior secured credit facility until April 3, 2026, consisting of a term loan facility in an amount up to $100.0 million and a revolving facility in an amount up to $450.0 million with an option to expand the credit facility by up to $275.0 million, with the consent of the lenders willing to provide additional borrowings in the form of increases to their revolving facility commitment or funding of incremental term loans. Borrowings may be denominated in U.S. dollars or certain other currencies. On November 10, 2022, we amended the 2021 Credit Agreement (the "Amendment") to update the benchmark provisions to replace LIBOR with Term SOFR (as defined in the Amendment) as the reference rate for purposes of calculating interest under the 2021 Credit Agreement. Pursuant to the Amendment, borrowings denominated in U.S. dollars bear interest at a rate per annum equal to (a) the Term SOFR Rate (as defined in the Amendment) plus a credit spread adjustment of 0.10% per annum, but in any case, not less than 0%, plus an additional spread of 1.10% to 1.70%, depending on the Company’s leverage ratio, or (b) the Alternate Base Rate (as defined in the Amendment), which is the greatest of (i) the prime rate, (ii) the federal funds rate plus 0.50% and (iii) the adjusted Term SOFR Rate for a one month period, but in any case, not less than 1.0%, plus, in any such case, 1.0%, plus an additional spread of 0.10% to 0.70%, depending on the Company’s leverage ratio. All other material terms included in the 2021 Credit Agreement remain unchanged as a result of the Amendment. In connection with the 2021 Credit Agreement, we reaffirmed our security interest in favor of the lenders in substantially all our personal property and pledged the stock of our domestic subsidiaries and 65% of the stock of our first-tier foreign subsidiaries. The obligations under the 2021 Credit Agreement are also guaranteed by certain of our first-tier domestic subsidiaries, and those subsidiaries also provided a security interest in their similar personal property. The 2021 Credit Agreement restricts the payment of dividends or repurchasing of stock requiring that, after giving effect to such payments, no default exists or would result from such payment. Additionally, cash dividends are restricted to $7.5 million per quarter and approved levels of other restricted payments range from $60.0 million to unlimited based on our net leverage ratio (not taking into account any acquisition holiday) after giving effect to such payment. The 2021 Credit Agreement contains customary representations, warranties and covenants, including but not limited to covenants restricting our ability to incur indebtedness and liens and to merge or consolidate with another entity. Further, the 2021 Credit Agreement contains the following covenants: • A covenant requiring us to maintain an indebtedness to EBITDA ratio, determined as of the end of each of our fiscal quarters, of no greater than 3.50 to 1.00, with certain alternative requirements for permitted acquisitions greater than $50.0 million; • A covenant requiring us to maintain an EBITDA to interest expense ratio for a period of four consecutive fiscal quarters as of the end of each quarter of no less than 3.00 to 1.00; and • A covenant restricting us from paying dividends or repurchasing stock if, after giving effect to such payments and assuming no default exists or would result from such payment, our leverage ratio is greater than 2.50 to 1.00, in such case limiting such payments to $60.0 million during any fiscal year. Debt Outstanding Debt outstanding consisted of the following: March 31, 2024 December 31, 2023 Credit facility borrowings: Revolving credit facility borrowings $ 125.0 $ 110.0 Term loan facility borrowings 88.8 90.0 Finance lease liabilities 0.8 0.6 Total debt 214.6 200.6 Less: current portion of long-term debt (a) (7.2) (6.4) Long-term debt $ 207.4 $ 194.2 (a) As of March 31, 2024, the Company is required to repay $6.9 million in outstanding credit facility borrowings and $0.3 million of finance lease liabilities over the next 12 months. As of March 31, 2024, we had outstanding borrowings of $125.0 million and $88.8 million under our revolving facility and term loan facility, respectively. We had letters of credit and bank guarantees outstanding in the amount of $3.2 million, leaving approximately $321.8 million of unused borrowing capacity on our revolving facility. Commitment fees on unused lines of credit for the three months ended March 31, 2024 were $0.1 million. The overall weighted average cost of debt was approximately 6.5% and net of related cross-currency swap instruments and fixed rate interest rate swap instruments was approximately 5.1%. Further details regarding the cross-currency swap instrument are discussed in Note 10. |
Warranty
Warranty | 3 Months Ended |
Mar. 31, 2024 | |
Guarantees [Abstract] | |
Warranty | Warranty We record a liability for warranty claims at the time of sale. The amount of the liability is based on the trend in the historical ratio of claims to sales, the historical length of time between the sale and resulting warranty claim, new product introductions and other factors. Warranty terms on machines generally range from one The changes in warranty reserves were as follows: Three Months Ended 2024 2023 Beginning balance $ 11.1 $ 10.9 Additions charged to expense 1.6 3.4 Foreign currency fluctuations — 0.1 Claims paid (1.8) (3.1) Ending balance $ 10.9 $ 11.3 |
Derivatives
Derivatives | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives | Derivatives Hedge Accounting and Hedging Programs We recognize all derivative instruments as either assets or liabilities in our consolidated balance sheets and measure them at fair value. Gains and losses resulting from changes in fair value are accounted for depending on the use of the derivative and whether it is designated and qualifies for hedge accounting. We evaluate hedge effectiveness on our hedges that are designated and qualify for hedge accounting at the inception of the hedge prospectively, as well as retrospectively, and record any ineffective portion of the hedging instruments along with the time value of purchased contracts in the same line item of the income statement as the item being hedged on our consolidated statements of income. Our hedging policy establishes maximum limits for each counterparty to mitigate any concentration of risk. Balance Sheet Hedges We hedge our net recognized foreign currency denominated assets and liabilities with foreign exchange forward contracts to reduce the risk that the value of these assets and liabilities will be adversely affected by changes in exchange rates. These contracts hedge assets and liabilities that are denominated in foreign currencies and are carried at fair value as either assets or liabilities on the consolidated balance sheets with changes in the fair value recorded to net foreign currency transaction gain (loss) in our consolidated statements of income. These contracts do not subject us to material balance sheet risk due to exchange rate movements because gains and losses on these derivatives are intended to offset gains and losses on the assets and liabilities being hedged. At March 31, 2024 and December 31, 2023, the notional amounts of foreign currency forward exchange contracts outstanding not designated as hedging instruments were $81.5 million and $73.0 million, respectively. Cash Flow Hedges We manage our floating rate debt exposure using interest rate swaps. Fixed rate swaps are used to reduce our risk of the possibility of increased interest costs. We entered into an aggregate $120 million notional amount of interest rate swaps effective December 1, 2022 that exchange a variable rate of interest for a fixed rate of interest of 4.076%. These interest rate swaps are designated as cash flow hedges. These swaps are scheduled to mature on December 1, 2026. Fair Value Hedges On April 5, 2022, we entered into Euro to U.S. dollar foreign exchange cross-currency swaps associated with an intercompany loan from a wholly owned European subsidiary. We enter into these foreign exchange cross-currency swaps to hedge the foreign currency risk associated with this intercompany loan, and accordingly, they are not speculative in nature. These cross-currency swaps are designated as fair value hedges. As of March 31, 2024 and December 31, 2023, these cross-currency swaps included €75.0 million of total notional value. As of March 31, 2024, the aggregated scheduled interest payments over the course of the loan and related swaps amounted to €6.9 million. The scheduled maturity and principal payment of the loan and related interest payments of €81.9 million are due in April 2027. Net Investment Hedges On April 5, 2022, we entered into Euro to U.S. dollar foreign exchange cross-currency swaps to hedge our exposure to adverse foreign currency exchange rate movements between Tennant Company and a wholly owned European subsidiary. We enter into these fixed-to-fixed cross-currency swap agreements to protect a designated monetary amount of the Company’s net investment in its Euro functional currency subsidiary against the risk of changes in the Euro to U.S. dollar foreign exchange rate. These cross-currency swaps are designated as net investment hedges. As of March 31, 2024 and December 31, 2023, the cross-currency swaps included €75.0 million of total notional value. These swaps are scheduled to mature in April 2027. The fair value of derivative instruments on our consolidated balance sheets was as follows: Derivative Assets Derivative Liabilities Balance Sheet Location March 31, 2024 December 31, 2023 Balance Sheet Location March 31, 2024 December 31, 2023 Derivatives designated as cash flow hedges: Interest rate swaps Other current assets $ 1.1 $ 0.8 Other current liabilities $ — $ — Interest rate swaps Other assets — — Other liabilities 0.4 1.9 Derivatives designated as fair value hedges: Cross-currency swaps Other current assets 1.4 1.3 Other current liabilities — — Cross-currency swaps Other assets — — Other liabilities 1.9 3.3 Derivatives designated as net investment hedges: Cross-currency swaps Other current assets 1.2 1.2 Other current liabilities — — Cross-currency swaps Other assets — — Other liabilities 2.1 3.4 Derivatives not designated as hedging instruments: Foreign currency forward contracts Other current assets $ 0.9 $ — Other current liabilities $ 0.1 $ 1.6 As of March 31, 2024, we anticipate reclassifying $2.4 million of gains from accumulated other comprehensive loss to net income during the next 12 months. The following tables include the amounts in the consolidated statements of income in which the effects of derivatives designated as hedging instruments are recorded: Three Months Ended March 31, 2024 2023 Total Gain on Hedging Total Gain (Loss) on Hedging Derivatives designated as cash flow hedges: Interest expense, net $ (2.3) $ 1.2 $ (3.7) $ 0.1 Net foreign currency transaction (loss) (0.2) — (0.1) — Derivatives designated as fair value hedges: Interest expense, net (2.3) 2.2 (3.7) 1.2 Net foreign currency transaction gain (loss) (0.2) 1.5 (0.1) 1.2 Derivatives designated as net investment hedges: Interest expense, net $ (2.3) $ 1.9 $ (3.7) $ 0.9 The effect of derivative instruments designated as hedges and derivative instruments not designated as hedges in our consolidated statements of income was as follows: Three Months Ended 2024 2023 Derivatives designated as cash flow hedges: Net gain (loss) recognized in other comprehensive loss, net of tax (a) $ 1.6 $ (0.9) Net gain reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net 0.3 0.1 Derivatives designated as fair value hedges: Net gain recognized in other comprehensive loss, net of tax (a) — 0.7 Net gain (loss) reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net 0.3 0.3 Derivatives designated as net investment hedges: Net (loss) recognized in other comprehensive loss, net of tax (a) (1.3) (0.1) Net gain (loss) reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net 0.2 0.2 Derivatives not designated as hedging instruments: Net (loss) recognized in income (b) $ — $ 0.8 (a) Net change in the fair value of the effective portion classified in other comprehensive income (loss). (b) Classified in net foreign currency transaction gain (loss). |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Estimates of fair value for financial assets and financial liabilities are based on the framework established in the accounting guidance for fair value measurements. The framework defines fair value, provides guidance for measuring fair value and requires certain disclosures. The framework discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow) and the cost approach (cost to replace the service capacity of an asset or replacement cost). The framework utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels: • Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. • Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. • Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions. Our population of assets and liabilities subject to fair value measurements at March 31, 2024 was as follows: Fair Level 1 Level 2 Level 3 Assets: Equity securities $ 20.0 $ — $ — $ 20.0 Debt securities 12.1 — — 12.1 Foreign currency forward exchange contracts 0.9 — 0.9 — Cross-currency swaps 2.6 — 2.6 — Interest rate swaps 1.1 — 1.1 — Total assets 36.7 — 4.6 32.1 Liabilities: Foreign currency forward exchange contracts 0.1 — 0.1 — Cross-currency swaps 4.0 — 4.0 — Interest rate swaps 0.4 — 0.4 — Total liabilities $ 4.5 $ — $ 4.5 $ — Our population of assets and liabilities subject to fair value measurements at December 31, 2023 was as follows: Fair Level 1 Level 2 Level 3 Assets: Cross-currency swaps $ 2.5 $ — $ 2.5 $ — Interest rate swaps 0.8 — 0.8 — Total assets 3.3 — 3.3 — Liabilities: Foreign currency forward exchange contracts 1.6 — 1.6 — Cross-currency swaps 6.7 — 6.7 — Interest rate swaps 1.9 — 1.9 — Total liabilities $ 10.2 $ — $ 10.2 $ — Our foreign currency forward exchange contracts, cross-currency swaps and interest rate swaps are valued using observable Level 2 market expectations at the measurement date and standard valuation techniques to convert future amounts to a single present value amount. Further details regarding our derivative instruments are discussed in Note 10. On February 21, 2024, the Company acquired certain investment securities in Brain Corp, a privately held autonomous technology company located in San Diego, California. The investment will drive the development and adoption of Brain Corp's next generation of robotic and AI technologies. The investment securities include $12.1 million of redeemable convertible preferred stock, accounted for as available-for-sale debt instruments. The investment securities also include $12.2 million of non-redeemable convertible preferred stock and $7.8 million of warrants, accounted for as equity instruments under the elected measurement alternative. The equity and debt securities were recorded at closing at their allocated fair values. For equity instruments, the carrying amount will be adjusted to fair value through net income each period based upon observable transactions for identical or similar investments of the same issuer and monitored for impairment. For debt instruments, the carrying amount will be adjusted to fair value each period through other comprehensive income. The securities will be measured to fair value based on a Level 3 fair value calculation. As of March 31, 2024, the total carrying value of our equity and debt instruments was $20.0 million and $12.1 million, respectively, which is recorded in other assets on the consolidated balance sheet. The debt instruments will mature on February 21, 2029. There have been no remeasurements of the equity or debt securities as of March 31, 2024. The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, restricted cash, accounts receivable, other current assets, accounts payable and other current liabilities approximate fair value due to their short-term nature. The fair value and carrying value of total debt, including current portion, was $215.8 million and $214.6 million, respectively, as of March 31, 2024. The fair value and carrying value of total debt, including current portion, was $198.2 million and $200.6 million, respectively, as of December 31, 2023. The fair value was calculated based on the borrowing rates currently available to us for bank loans with similar terms and remaining maturities, which is a Level 2 in the fair value hierarchy. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies In the ordinary course of business, we may become liable with respect to pending and threatened litigation, tax, environmental and other matters. While the ultimate results of current claims, investigations and lawsuits involving us are unknown at this time, we do not expect that these matters will have a material adverse effect on our consolidated financial position or results of operations. Legal costs associated with such matters are expensed as incurred. |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended |
Mar. 31, 2024 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders' Equity Accumulated Other Comprehensive Loss The changes in components of accumulated other comprehensive loss, net of tax, are as follows: Three Months Ended March 31, 2024 Foreign Currency Pension and Post- Derivative Financial Instruments Total Beginning balance $ (45.6) $ 3.7 $ (0.4) $ (42.3) Other comprehensive (loss) income before reclassifications (8.0) — 1.6 (6.4) Amounts reclassified from accumulated other comprehensive loss (0.2) — (0.6) (0.8) Net current period other comprehensive income (8.2) — 1.0 (7.2) Ending balance $ (53.8) $ 3.7 $ 0.6 $ (49.5) Three Months Ended March 31, 2023 Foreign Currency Pension and Post- Derivative Financial Instruments Total Beginning balance $ (53.9) $ 2.7 $ 1.0 $ (50.2) Other comprehensive income (loss) before reclassifications 5.5 — (0.2) 5.3 Amounts reclassified from accumulated other comprehensive loss (0.2) — (0.4) (0.6) Net current period other comprehensive income (loss) 5.3 — (0.6) 4.7 Ending balance $ (48.6) $ 2.7 $ 0.4 $ (45.5) |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We and our subsidiaries are subject to U.S. federal income tax as well as income tax of numerous state and foreign jurisdictions. We are generally no longer subject to U.S. federal tax examinations for taxable years before 2018. The number of years which remain open for audit for U.S. state or foreign tax purposes varies by jurisdiction but generally ranges from three We recognize potential accrued interest and penalties related to unrecognized tax benefits in income tax expense. In addition to the liability of $4.3 million for unrecognized tax benefits as of March 31, 2024, there was approximately $0.5 million for accrued interest and penalties. The total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate as of March 31, 2024 was $3.9 million. To the extent interest and penalties are not assessed with respect to uncertain tax positions, amounts accrued will be revised and reflected as an adjustment of the income tax expense. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based Compensation Our share-based compensation plans are described in Note 18 of our annual report on Form 10-K for the year ended December 31, 2023. During the three months ended March 31, 2024 and 2023, we recognized total share-based compensation expense of $3.2 million and $1.2 million, respectively. The total excess tax recognized for share-based compensation arrangements during the three months ended March 31, 2024 and 2023 was a tax benefit of $2.4 million and tax expense of $0.1 million, respectively. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The computations of basic and diluted earnings per share were as follows: Three Months Ended 2024 2023 Numerator: Net income $ 28.4 $ 24.3 Denominator: Basic - weighted average shares outstanding 18,665,570 18,449,430 Effect of dilutive securities 412,197 232,838 Diluted - weighted average shares outstanding 19,077,767 18,682,268 Basic earnings per share $ 1.52 $ 1.32 Diluted earnings per share $ 1.49 $ 1.30 Excluded from the dilutive securities shown above were options to purchase and shares to be paid out under share-based compensation plans of 37,508 and 393,242 shares of common stock during the three months ended March 31, 2024 and 2023, respectively. These exclusions were made if the exercise prices of the options are greater than the average market price of our common stock for the period, if the number of shares we can repurchase under the treasury stock method exceeds the weighted average shares outstanding in the options or if we have a net loss, as these effects would be anti-dilutive. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net income | $ 28.4 | $ 24.3 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 shares | |
Trading Arrangements, by Individual | |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Donal L. Mulligan [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On March 6, 2024, Donal L. Mulligan, Board of Directors, adopted a Rule 10b5-1 trading arrangement that is intended to satisfy the affirmative defense of Rule 10b5-1(c) for the sale of up to 3,538 shares of the Company’s common stock until April 28, 2026. |
Name | Donal L. Mulligan |
Title | Board of Directors |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 6, 2024 |
Arrangement Duration | 783 days |
Aggregate Available | 3,538 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation – The accompanying unaudited consolidated financial statements have been prepared in accordance with the U.S. Securities and Exchange Commission (“SEC”) requirements for interim reporting. In our opinion, the consolidated financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary for the fair presentation of our financial position and results of operations. These statements should be read in conjunction with the consolidated financial statements and notes included in our annual report on Form 10-K for the year ended December 31, 2023. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year. |
Newly Adopted Accounting Pronouncements | Newly Adopted Accounting Pronouncements There are no newly adopted accounting pronouncements during the three months ended March 31, 2024 that impacted the Company. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following tables illustrate the disaggregation of revenue by geographic area, groups of similar products and services and sales channels: Net sales by geographic area Three Months Ended 2024 2023 Americas $ 215.6 $ 204.4 Europe, Middle East and Africa 76.8 82.1 Asia Pacific 18.6 19.3 Total $ 311.0 $ 305.8 Net sales are attributed to each geographic area based on the end-user country and are net of intercompany sales. Net sales by groups of similar products and services Three Months Ended 2024 2023 Equipment $ 189.8 $ 186.4 Parts and consumables 70.6 73.4 Service and other 50.6 46.0 Total $ 311.0 $ 305.8 Net sales by sales channel Three Months Ended 2024 2023 Sales direct to consumer $ 221.4 $ 205.1 Sales to distributors 89.6 100.7 Total $ 311.0 $ 305.8 |
Schedule of Change in Sales Incentive Accrual Balance and Deferred Revenue Balance | The change in our sales incentive accrual balance was as follows: Three Months Ended 2024 2023 Beginning balance $ 21.2 $ 20.0 Additions to sales incentive accrual 6.3 6.6 Contract payments (11.3) (11.3) Foreign currency fluctuations (0.4) 0.1 Ending balance $ 15.8 $ 15.4 The change in the deferred revenue balance was as follows: Three Months Ended 2024 2023 Beginning balance $ 10.3 $ 9.3 Increase in deferred revenue representing our obligation to satisfy future performance obligations 5.0 5.5 Decrease in deferred revenue for amounts recognized in net sales for satisfied performance obligations (4.3) (4.7) Foreign currency fluctuations (0.1) 0.1 Ending balance $ 10.9 $ 10.2 |
Schedule of Recognition of Net Sales in Future Periods | Of these amounts, we expect to recognize the following approximate amounts in net sales in the following periods: Remaining 2024 $ 6.6 2025 2.1 2026 1.3 2027 0.6 2028 0.2 Thereafter 0.1 Total $ 10.9 |
Management Actions (Tables)
Management Actions (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Reconciliation of Liability Balance of Severance and Related Costs | A reconciliation of the beginning and ending liability balances for severance-related costs is as follows: Three Months Ended 2024 2023 Beginning balance $ 2.4 $ 1.7 New charges — — Cash payments (0.4) (0.5) Foreign currency fluctuations (0.1) — Adjustments to accrual — — Ending balance $ 1.9 $ 1.2 |
Acquisitions (Tables)
Acquisitions (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the preliminary fair value measurement of the assets acquired and liabilities assumed as of the date of acquisition: Components of purchase price: Cash paid $ 30.8 Settlement of preexisting transactions 3.9 Total purchase price 34.7 ASSETS Cash 5.3 Other current assets 8.0 Intangible assets subject to amortization Customer lists 13.6 Backlog 0.6 Other assets 5.3 Total identifiable assets acquired 32.8 LIABILITIES Current liabilities (1.5) Long-term liabilities (5.0) Total identifiable liabilities assumed (6.5) Net assets acquired 26.3 Goodwill $ 8.4 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories are valued at the lower of cost or net realizable value and consisted of the following: March 31, December 31, Inventories carried at LIFO: Finished goods (a) $ 75.4 $ 74.7 Raw materials and work-in-process 37.1 38.5 Excess of FIFO over LIFO cost (b) (47.5) (47.7) Total LIFO inventories $ 65.0 $ 65.5 Inventories carried at FIFO: Finished goods (a) $ 56.9 $ 52.8 Raw materials and work-in-process 59.5 57.6 Total FIFO inventories $ 116.4 $ 110.4 Total inventories $ 181.4 $ 175.9 (a) Finished goods include machines, parts and consumables and component parts that are used in our products. (b) The difference between replacement cost and the stated LIFO inventory value is not materially different from the reserve for the LIFO valuation method. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in the Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the three months ended March 31, 2024 were as follows: Goodwill Accumulated Impairment Losses Total Balance as of December 31, 2023 $ 220.7 $ (33.3) $ 187.4 Additions 8.4 — 8.4 Foreign currency fluctuations (3.9) 0.3 (3.6) Balance as of March 31, 2024 $ 225.2 $ (33.0) $ 192.2 |
Schedule of Balances of Acquired Intangible Assets, Excluding Goodwill | The balances of acquired intangible assets, excluding goodwill, were as follows: Customer Lists Trade Names Technology Total Balance as of March 31, 2024 Original cost $ 161.7 $ 28.7 $ 16.1 $ 206.5 Accumulated amortization (101.5) (19.5) (13.2) (134.2) Carrying value $ 60.2 $ 9.2 $ 2.9 $ 72.3 Weighted average original life (in years) 14 10 12 Balance as of December 31, 2023 Original cost $ 150.6 $ 29.3 $ 16.3 $ 196.2 Accumulated amortization (100.8) (19.2) (13.1) (133.1) Carrying value $ 49.8 $ 10.1 $ 3.2 $ 63.1 Weighted average original life (in years) 15 11 11 |
Schedule of Estimated Aggregate Amortization Expense | Estimated aggregate amortization expense based on the current carrying value of amortizable intangible assets for each of the five succeeding years and thereafter is as follows: Remaining 2024 $ 11.2 2025 13.1 2026 11.9 2027 8.6 2028 6.9 Thereafter 20.6 Total $ 72.3 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Outstanding | Debt outstanding consisted of the following: March 31, 2024 December 31, 2023 Credit facility borrowings: Revolving credit facility borrowings $ 125.0 $ 110.0 Term loan facility borrowings 88.8 90.0 Finance lease liabilities 0.8 0.6 Total debt 214.6 200.6 Less: current portion of long-term debt (a) (7.2) (6.4) Long-term debt $ 207.4 $ 194.2 (a) As of March 31, 2024, the Company is required to repay $6.9 million in outstanding credit facility borrowings and $0.3 million of finance lease liabilities over the next 12 months. |
Warranty (Tables)
Warranty (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Guarantees [Abstract] | |
Schedule of Changes in Warranty Reserves | The changes in warranty reserves were as follows: Three Months Ended 2024 2023 Beginning balance $ 11.1 $ 10.9 Additions charged to expense 1.6 3.4 Foreign currency fluctuations — 0.1 Claims paid (1.8) (3.1) Ending balance $ 10.9 $ 11.3 |
Derivatives (Tables)
Derivatives (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Value of Derivative Instruments | The fair value of derivative instruments on our consolidated balance sheets was as follows: Derivative Assets Derivative Liabilities Balance Sheet Location March 31, 2024 December 31, 2023 Balance Sheet Location March 31, 2024 December 31, 2023 Derivatives designated as cash flow hedges: Interest rate swaps Other current assets $ 1.1 $ 0.8 Other current liabilities $ — $ — Interest rate swaps Other assets — — Other liabilities 0.4 1.9 Derivatives designated as fair value hedges: Cross-currency swaps Other current assets 1.4 1.3 Other current liabilities — — Cross-currency swaps Other assets — — Other liabilities 1.9 3.3 Derivatives designated as net investment hedges: Cross-currency swaps Other current assets 1.2 1.2 Other current liabilities — — Cross-currency swaps Other assets — — Other liabilities 2.1 3.4 Derivatives not designated as hedging instruments: Foreign currency forward contracts Other current assets $ 0.9 $ — Other current liabilities $ 0.1 $ 1.6 |
Schedule of Effects of Derivatives Designated as Hedging Instruments | The following tables include the amounts in the consolidated statements of income in which the effects of derivatives designated as hedging instruments are recorded: Three Months Ended March 31, 2024 2023 Total Gain on Hedging Total Gain (Loss) on Hedging Derivatives designated as cash flow hedges: Interest expense, net $ (2.3) $ 1.2 $ (3.7) $ 0.1 Net foreign currency transaction (loss) (0.2) — (0.1) — Derivatives designated as fair value hedges: Interest expense, net (2.3) 2.2 (3.7) 1.2 Net foreign currency transaction gain (loss) (0.2) 1.5 (0.1) 1.2 Derivatives designated as net investment hedges: Interest expense, net $ (2.3) $ 1.9 $ (3.7) $ 0.9 The effect of derivative instruments designated as hedges and derivative instruments not designated as hedges in our consolidated statements of income was as follows: Three Months Ended 2024 2023 Derivatives designated as cash flow hedges: Net gain (loss) recognized in other comprehensive loss, net of tax (a) $ 1.6 $ (0.9) Net gain reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net 0.3 0.1 Derivatives designated as fair value hedges: Net gain recognized in other comprehensive loss, net of tax (a) — 0.7 Net gain (loss) reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net 0.3 0.3 Derivatives designated as net investment hedges: Net (loss) recognized in other comprehensive loss, net of tax (a) (1.3) (0.1) Net gain (loss) reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net 0.2 0.2 Derivatives not designated as hedging instruments: Net (loss) recognized in income (b) $ — $ 0.8 (a) Net change in the fair value of the effective portion classified in other comprehensive income (loss). (b) Classified in net foreign currency transaction gain (loss). |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Assets and Liabilities Subject to Fair Value Measurements | Our population of assets and liabilities subject to fair value measurements at March 31, 2024 was as follows: Fair Level 1 Level 2 Level 3 Assets: Equity securities $ 20.0 $ — $ — $ 20.0 Debt securities 12.1 — — 12.1 Foreign currency forward exchange contracts 0.9 — 0.9 — Cross-currency swaps 2.6 — 2.6 — Interest rate swaps 1.1 — 1.1 — Total assets 36.7 — 4.6 32.1 Liabilities: Foreign currency forward exchange contracts 0.1 — 0.1 — Cross-currency swaps 4.0 — 4.0 — Interest rate swaps 0.4 — 0.4 — Total liabilities $ 4.5 $ — $ 4.5 $ — Our population of assets and liabilities subject to fair value measurements at December 31, 2023 was as follows: Fair Level 1 Level 2 Level 3 Assets: Cross-currency swaps $ 2.5 $ — $ 2.5 $ — Interest rate swaps 0.8 — 0.8 — Total assets 3.3 — 3.3 — Liabilities: Foreign currency forward exchange contracts 1.6 — 1.6 — Cross-currency swaps 6.7 — 6.7 — Interest rate swaps 1.9 — 1.9 — Total liabilities $ 10.2 $ — $ 10.2 $ — |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss, Net of Tax | The changes in components of accumulated other comprehensive loss, net of tax, are as follows: Three Months Ended March 31, 2024 Foreign Currency Pension and Post- Derivative Financial Instruments Total Beginning balance $ (45.6) $ 3.7 $ (0.4) $ (42.3) Other comprehensive (loss) income before reclassifications (8.0) — 1.6 (6.4) Amounts reclassified from accumulated other comprehensive loss (0.2) — (0.6) (0.8) Net current period other comprehensive income (8.2) — 1.0 (7.2) Ending balance $ (53.8) $ 3.7 $ 0.6 $ (49.5) Three Months Ended March 31, 2023 Foreign Currency Pension and Post- Derivative Financial Instruments Total Beginning balance $ (53.9) $ 2.7 $ 1.0 $ (50.2) Other comprehensive income (loss) before reclassifications 5.5 — (0.2) 5.3 Amounts reclassified from accumulated other comprehensive loss (0.2) — (0.4) (0.6) Net current period other comprehensive income (loss) 5.3 — (0.6) 4.7 Ending balance $ (48.6) $ 2.7 $ 0.4 $ (45.5) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Computations of Basic and Diluted Earnings per Share | The computations of basic and diluted earnings per share were as follows: Three Months Ended 2024 2023 Numerator: Net income $ 28.4 $ 24.3 Denominator: Basic - weighted average shares outstanding 18,665,570 18,449,430 Effect of dilutive securities 412,197 232,838 Diluted - weighted average shares outstanding 19,077,767 18,682,268 Basic earnings per share $ 1.52 $ 1.32 Diluted earnings per share $ 1.49 $ 1.30 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 311 | $ 305.8 |
Sales direct to consumer | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 221.4 | 205.1 |
Sales to distributors | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 89.6 | 100.7 |
Equipment | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 189.8 | 186.4 |
Parts and consumables | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 70.6 | 73.4 |
Service and other | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 50.6 | 46 |
Americas | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 215.6 | 204.4 |
Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 76.8 | 82.1 |
Asia Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 18.6 | $ 19.3 |
Revenue - Contract Liabilities
Revenue - Contract Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Sales Incentives | ||
Movement in Deferred Sales Inducements [Roll Forward] | ||
Beginning balance | $ 21.2 | $ 20 |
Additions to sales incentive accrual | 6.3 | 6.6 |
Contract payments | (11.3) | (11.3) |
Foreign currency fluctuations | (0.4) | 0.1 |
Ending balance | 15.8 | 15.4 |
Movement in Deferred Revenue [Roll Forward] | ||
Foreign currency fluctuations | (0.4) | 0.1 |
Maintenance | ||
Movement in Deferred Sales Inducements [Roll Forward] | ||
Foreign currency fluctuations | (0.1) | 0.1 |
Movement in Deferred Revenue [Roll Forward] | ||
Beginning balance | 10.3 | 9.3 |
Increase in deferred revenue representing our obligation to satisfy future performance obligations | 5 | 5.5 |
Decrease in deferred revenue for amounts recognized in net sales for satisfied performance obligations | (4.3) | (4.7) |
Foreign currency fluctuations | (0.1) | 0.1 |
Ending balance | $ 10.9 | $ 10.2 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
Other current liabilities | Maintenance | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue, current | $ 7.1 | $ 7.9 |
Other liabilities | Maintenance | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue, noncurrent | $ 3.8 | $ 2.4 |
Minimum | ||
Disaggregation of Revenue [Line Items] | ||
Standard prepaid maintenance contract time period (months) | 12 months | |
Maximum | ||
Disaggregation of Revenue [Line Items] | ||
Standard prepaid maintenance contract time period (months) | 60 months |
Revenue - Remaining Performance
Revenue - Remaining Performance Obligation (Details) $ in Millions | Mar. 31, 2024 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total remaining performance obligation | $ 10.9 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total remaining performance obligation | $ 6.6 |
Remaining performance obligation, expected timing of satisfaction period | 9 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total remaining performance obligation | $ 2.1 |
Remaining performance obligation, expected timing of satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total remaining performance obligation | $ 1.3 |
Remaining performance obligation, expected timing of satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total remaining performance obligation | $ 0.6 |
Remaining performance obligation, expected timing of satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2028-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total remaining performance obligation | $ 0.2 |
Remaining performance obligation, expected timing of satisfaction period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2029-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Total remaining performance obligation | $ 0.1 |
Remaining performance obligation, expected timing of satisfaction period |
Management Actions - Reconcilia
Management Actions - Reconciliation of Liability Balance of Severance and Related Costs (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring Reserve [Roll Forward] | ||
Beginning balance | $ 2.4 | $ 1.7 |
New charges | 0 | 0 |
Cash payments | (0.4) | (0.5) |
Foreign currency fluctuations | (0.1) | 0 |
Adjustments to accrual | 0 | 0 |
Ending balance | $ 1.9 | $ 1.2 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - Management and Financing GmbH - USD ($) $ in Millions | 3 Months Ended | |
Feb. 29, 2024 | Mar. 31, 2024 | |
Business Acquisition [Line Items] | ||
Business acquisition, percentage of voting interests acquired | 100% | |
Revenues | $ 2.1 | |
Cash paid | $ 30.8 | |
Settlement of preexisting transactions | 3.9 | |
Business acquisition, goodwill, expected tax deductible amount | $ 0 | |
Backlog | ||
Business Acquisition [Line Items] | ||
Finite-lived intangible asset, expected useful life (in years) | 3 months | |
Customer lists | ||
Business Acquisition [Line Items] | ||
Finite-lived intangible asset, expected useful life (in years) | 10 years |
Acquisitions - Recognized Ident
Acquisitions - Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | Feb. 29, 2024 | Mar. 31, 2024 | Dec. 31, 2023 |
LIABILITIES | |||
Goodwill | $ 192.2 | $ 187.4 | |
Management and Financing GmbH | |||
Components of purchase price: | |||
Cash paid | $ 30.8 | ||
Settlement of preexisting transactions | 3.9 | ||
Total purchase price | 34.7 | ||
ASSETS | |||
Cash | 5.3 | ||
Other current assets | 8 | ||
Intangible assets subject to amortization | 14.2 | ||
Other assets | 5.3 | ||
Total identifiable assets acquired | 32.8 | ||
LIABILITIES | |||
Current liabilities | (1.5) | ||
Long-term liabilities | (5) | ||
Total identifiable liabilities assumed | (6.5) | ||
Net assets acquired | 26.3 | ||
Goodwill | 8.4 | ||
Management and Financing GmbH | Customer lists | |||
ASSETS | |||
Intangible assets subject to amortization | 13.6 | ||
Management and Financing GmbH | Backlog | |||
ASSETS | |||
Intangible assets subject to amortization | $ 0.6 |
Inventories - Inventories (Deta
Inventories - Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Inventory [Line Items] | ||
Excess of FIFO over LIFO cost | $ (47.5) | $ (47.7) |
Total LIFO inventories | 65 | 65.5 |
Total FIFO inventories | 116.4 | 110.4 |
Total inventories | 181.4 | 175.9 |
Inventories carried at LIFO: | ||
Inventory [Line Items] | ||
Finished goods | 75.4 | 74.7 |
Raw materials and work-in-process | 37.1 | 38.5 |
Inventories carried at FIFO: | ||
Inventory [Line Items] | ||
Finished goods | 56.9 | 52.8 |
Raw materials and work-in-process | $ 59.5 | $ 57.6 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Changes in Carrying Amount of Goodwill (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Goodwill [Roll Forward] | |
Beginning balance | $ 220.7 |
Beginning balance, accumulated impairment losses | (33.3) |
Beginning balance, net | 187.4 |
Additions | 8.4 |
Foreign currency fluctuations | (3.9) |
Foreign currency fluctuations, accumulated impairment losses | 0.3 |
Foreign currency fluctuations, net | (3.6) |
Ending balance | 225.2 |
Ending balance, accumulated impairment losses | (33) |
Ending balance, net | $ 192.2 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Balances of Acquired Intangible Assets, Excluding Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Mar. 31, 2024 | Dec. 31, 2023 | |
Finite-Lived Intangible Assets [Line Items] | ||
Original cost | $ 206.5 | $ 196.2 |
Accumulated amortization | (134.2) | (133.1) |
Carrying value | 72.3 | 63.1 |
Customer Lists | ||
Finite-Lived Intangible Assets [Line Items] | ||
Original cost | 161.7 | 150.6 |
Accumulated amortization | (101.5) | (100.8) |
Carrying value | $ 60.2 | $ 49.8 |
Weighted average original life (in years) | 14 years | 15 years |
Trade Names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Original cost | $ 28.7 | $ 29.3 |
Accumulated amortization | (19.5) | (19.2) |
Carrying value | $ 9.2 | $ 10.1 |
Weighted average original life (in years) | 10 years | 11 years |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Original cost | $ 16.1 | $ 16.3 |
Accumulated amortization | (13.2) | (13.1) |
Carrying value | $ 2.9 | $ 3.2 |
Weighted average original life (in years) | 12 years | 11 years |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Feb. 29, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization expense | $ 3.9 | $ 3.9 | |
Management and Financing GmbH | |||
Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets subject to amortization | $ 14.2 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Estimated Aggregate Amortization Expense (Details) $ in Millions | Mar. 31, 2024 USD ($) |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | |
Remaining 2024 | $ 11.2 |
2025 | 13.1 |
2026 | 11.9 |
2027 | 8.6 |
2028 | 6.9 |
Thereafter | 20.6 |
Total | $ 72.3 |
Debt - Narrative (Details)
Debt - Narrative (Details) | 3 Months Ended | |||
Nov. 10, 2022 | Apr. 05, 2021 USD ($) | Mar. 31, 2024 USD ($) | Dec. 31, 2023 USD ($) | |
Debt Instrument [Line Items] | ||||
Cross-currency swap instruments, net | 5.10% | |||
The 2021 Credit Agreement | ||||
Debt Instrument [Line Items] | ||||
Collateral, percentage of stock of first tier foreign subsidiaries | 65% | |||
Dividend payments | $ 7,500,000 | |||
EBITDA ratio, maximum | 3.50 | |||
Permitted acquisitions | $ 50,000,000 | |||
Maximum EBITDA to interest expense ratio | 300% | |||
Leverage ratio minimum | 2.50 | |||
Dividends payout | $ 60,000,000 | |||
Letters of credit outstanding | $ 3,200,000 | |||
Commitment fees on unused lines of credit | 100,000 | |||
The 2021 Credit Agreement | Secured Overnight Financing Rate Adjustment | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 0.10% | |||
The 2021 Credit Agreement | Secured Overnight Financing Rate | ||||
Debt Instrument [Line Items] | ||||
Variable rate floor | 0% | |||
The 2021 Credit Agreement | Fed Funds Effective Rate Overnight Index Swap Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 0.50% | |||
The 2021 Credit Agreement | Adjusted Secured Overnight Financing Rate | ||||
Debt Instrument [Line Items] | ||||
Variable rate floor | 1% | |||
The 2021 Credit Agreement | Minimum | ||||
Debt Instrument [Line Items] | ||||
Other restricted payments | 60,000,000 | |||
The 2021 Credit Agreement | Minimum | Secured Overnight Financing Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 1.10% | |||
The 2021 Credit Agreement | Minimum | Adjusted Secured Overnight Financing Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 0.10% | |||
The 2021 Credit Agreement | Maximum | Secured Overnight Financing Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 1.70% | |||
The 2021 Credit Agreement | Maximum | Adjusted Secured Overnight Financing Rate | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 0.70% | |||
The 2021 Credit Agreement | Revolving credit facility borrowings | ||||
Debt Instrument [Line Items] | ||||
Revolving credit facility | 450,000,000 | |||
Credit facility | 275,000,000 | |||
Outstanding borrowings | 125,000,000 | $ 110,000,000 | ||
Unused borrowing capacity | 321,800,000 | |||
The 2021 Credit Agreement | Term loan facility borrowings | ||||
Debt Instrument [Line Items] | ||||
Outstanding principal amount | $ 100,000,000 | |||
Outstanding borrowings | $ 88,800,000 | $ 90,000,000 | ||
Debt Including Related Cross-currency Swap Instrument | ||||
Debt Instrument [Line Items] | ||||
Weighted average cost of debt | 6.50% |
Debt - Debt Outstanding (Detail
Debt - Debt Outstanding (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Debt Instrument [Line Items] | ||
Finance lease liabilities | $ 0.8 | $ 0.6 |
Total debt | 214.6 | 200.6 |
Less: current portion of long-term debt | (7.2) | (6.4) |
Long-term debt | 207.4 | 194.2 |
The 2021 Credit Agreement | ||
Debt Instrument [Line Items] | ||
Repayment of outstanding credit facility borrowings | 6.9 | |
Finance lease liabilities current | 0.3 | |
The 2021 Credit Agreement | Term loan facility borrowings | ||
Debt Instrument [Line Items] | ||
Outstanding borrowings | 88.8 | 90 |
The 2021 Credit Agreement | Revolving credit facility borrowings | ||
Debt Instrument [Line Items] | ||
Outstanding borrowings | $ 125 | $ 110 |
Warranty - Narrative (Details)
Warranty - Narrative (Details) | 3 Months Ended |
Mar. 31, 2024 | |
Minimum | |
Guarantor Obligations [Line Items] | |
Machine warranty, period (Year) | 1 year |
Maximum | |
Guarantor Obligations [Line Items] | |
Machine warranty, period (Year) | 4 years |
Warranty - Changes in Warranty
Warranty - Changes in Warranty Reserves (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Beginning balance | $ 11.1 | $ 10.9 |
Additions charged to expense | 1.6 | 3.4 |
Foreign currency fluctuations | 0 | 0.1 |
Claims paid | (1.8) | (3.1) |
Ending balance | $ 10.9 | $ 11.3 |
Derivatives - Narrative (Detail
Derivatives - Narrative (Details) € in Millions | 3 Months Ended | |||||
Mar. 31, 2024 USD ($) | Mar. 31, 2024 EUR (€) | Mar. 31, 2024 EUR (€) | Dec. 31, 2023 USD ($) | Dec. 31, 2023 EUR (€) | Dec. 01, 2022 USD ($) | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivate gains to be reclassified within the next twelve months | $ | $ 2,400,000 | |||||
Derivatives not designated as hedging instruments: | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative, notional amount | $ | $ 73,000,000 | |||||
Foreign currency forward contracts | Derivatives not designated as hedging instruments: | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative, notional amount | $ | $ 81,500,000 | |||||
Interest rate swaps | Derivatives designated as hedging instruments | Derivatives designated as cash flow hedges: | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative, notional amount | $ | $ 120,000,000 | |||||
Fixed interest rate | 4.076% | |||||
Cross-currency swaps | Derivatives designated as hedging instruments | Derivatives designated as fair value hedges: | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative, notional amount | € | € 75 | € 75 | ||||
Debt instrument, periodic payment, interest | € | € 6.9 | |||||
Debt instrument, periodic payment, principal | € | € 81.9 | |||||
Cross-currency swaps | Derivatives designated as hedging instruments | Derivatives designated as net investment hedges: | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Derivative, notional amount | € | € 75 | € 75 |
Derivatives - Fair Value of Der
Derivatives - Fair Value of Derivative Instruments (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Derivatives designated as hedging instruments | Interest rate swaps | Derivatives designated as cash flow hedges: | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 1.1 | $ 0.8 |
Derivative Liabilities | 0 | 0 |
Derivative other asset, before offset | 0 | 0 |
Derivative other liability, asset offset | 0.4 | 1.9 |
Derivatives designated as hedging instruments | Cross-currency swaps | Derivatives designated as fair value hedges: | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 1.4 | 1.3 |
Derivative Liabilities | 0 | 0 |
Derivative other asset, before offset | 0 | 0 |
Derivative other liability, asset offset | 1.9 | 3.3 |
Derivatives designated as hedging instruments | Cross-currency swaps | Derivatives designated as net investment hedges: | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 1.2 | 1.2 |
Derivative Liabilities | 0 | 0 |
Derivative other asset, before offset | 0 | 0 |
Derivative other liability, asset offset | 2.1 | 3.4 |
Derivatives not designated as hedging instruments: | Foreign currency forward contracts | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 0.9 | 0 |
Derivative Liabilities | $ 0.1 | $ 1.6 |
Derivatives - Effect of Derivat
Derivatives - Effect of Derivative Instruments on Consolidated Statements of Earnings (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Interest expense, net | $ (2.3) | $ (3.7) |
Net foreign currency transaction gain (loss) | (0.2) | (0.1) |
Net gain (loss) recognized in other comprehensive (loss) income, net of tax | 1 | (0.6) |
Derivatives designated as hedging instruments | Derivatives designated as cash flow hedges: | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Interest expense, net | (2.3) | (3.7) |
Net foreign currency transaction gain (loss) | (0.2) | (0.1) |
Derivatives designated as hedging instruments | Derivatives designated as cash flow hedges: | Interest expense, net | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Gain (Loss) on Hedging | 1.2 | 0.1 |
Derivatives designated as hedging instruments | Derivatives designated as cash flow hedges: | Net foreign currency transaction (loss) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Gain (Loss) on Hedging | 0 | 0 |
Derivatives designated as hedging instruments | Derivatives designated as cash flow hedges: | Foreign Exchange Option | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Net gain (loss) recognized in other comprehensive (loss) income, net of tax | 1.6 | (0.9) |
Net gain (loss) reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net | 0.3 | 0.1 |
Derivatives designated as hedging instruments | Derivatives designated as fair value hedges: | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Interest expense, net | (2.3) | (3.7) |
Net foreign currency transaction gain (loss) | (0.2) | (0.1) |
Derivatives designated as hedging instruments | Derivatives designated as fair value hedges: | Interest expense, net | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Gain (Loss) on Hedging | 2.2 | 1.2 |
Derivatives designated as hedging instruments | Derivatives designated as fair value hedges: | Net foreign currency transaction (loss) | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Gain (Loss) on Hedging | 1.5 | 1.2 |
Derivatives designated as hedging instruments | Derivatives designated as fair value hedges: | Foreign Exchange Option | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Net gain (loss) recognized in other comprehensive (loss) income, net of tax | 0 | 0.7 |
Net gain (loss) reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net | 0.3 | 0.3 |
Derivatives designated as hedging instruments | Derivatives designated as net investment hedges: | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Interest expense, net | (2.3) | (3.7) |
Derivatives designated as hedging instruments | Derivatives designated as net investment hedges: | Interest expense, net | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Gain (Loss) on Hedging | 1.9 | 0.9 |
Derivatives designated as hedging instruments | Derivatives designated as net investment hedges: | Foreign Exchange Option | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Net gain (loss) recognized in other comprehensive (loss) income, net of tax | (1.3) | (0.1) |
Net gain (loss) reclassified from accumulated other comprehensive loss into income, net of tax, effective portion to interest expense, net | 0.2 | 0.2 |
Derivatives not designated as hedging instruments: | Foreign Exchange Option | ||
Foreign Currency Fair Value Hedge Derivative [Line Items] | ||
Net (loss) recognized in income | $ 0 | $ 0.8 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Subject to Fair Value Measurements (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | $ 20 | |
Debt securities | 12.1 | |
Total assets | 36.7 | $ 3.3 |
Total liabilities | 4.5 | 10.2 |
Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | 0 | |
Debt securities | 0 | |
Total assets | 0 | 0 |
Total liabilities | 0 | 0 |
Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | 0 | |
Debt securities | 0 | |
Total assets | 4.6 | 3.3 |
Total liabilities | 4.5 | 10.2 |
Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | 20 | |
Debt securities | 12.1 | |
Total assets | 32.1 | 0 |
Total liabilities | 0 | 0 |
Foreign currency forward exchange contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward exchange contracts | 0.9 | |
Foreign currency forward exchange contracts | 0.1 | 1.6 |
Foreign currency forward exchange contracts | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward exchange contracts | 0 | |
Foreign currency forward exchange contracts | 0 | 0 |
Foreign currency forward exchange contracts | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward exchange contracts | 0.9 | |
Foreign currency forward exchange contracts | 0.1 | 1.6 |
Foreign currency forward exchange contracts | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward exchange contracts | 0 | |
Foreign currency forward exchange contracts | 0 | 0 |
Cross-currency swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 2.6 | 2.5 |
Derivative liability | 4 | 6.7 |
Cross-currency swaps | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Cross-currency swaps | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 2.6 | 2.5 |
Derivative liability | 4 | 6.7 |
Cross-currency swaps | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Interest rate swaps | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1.1 | 0.8 |
Derivative liability | 0.4 | 1.9 |
Interest rate swaps | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | 0 | 0 |
Interest rate swaps | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 1.1 | 0.8 |
Derivative liability | 0.4 | 1.9 |
Interest rate swaps | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Derivative asset | 0 | 0 |
Derivative liability | $ 0 | $ 0 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt securities | $ 12.1 | |
Equity securities | 20 | |
Fair value of total debt | 215.8 | $ 198.2 |
Carrying value of total debt | 214.6 | $ 200.6 |
Redeemable Preferred Stock | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt securities | 12.1 | |
Nonredeemable Preferred Stock | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | 12.2 | |
Warrant | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Equity securities | $ 7.8 |
Shareholders' Equity - Accumula
Shareholders' Equity - Accumulated Other Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | $ 578.3 | $ 472.1 |
Other comprehensive (loss) income before reclassifications | (6.4) | 5.3 |
Amounts reclassified from accumulated other comprehensive loss | (0.8) | (0.6) |
Total other comprehensive (loss) income, net of tax | (7.2) | 4.7 |
Ending balance | 615.9 | 493.2 |
Total | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | (42.3) | (50.2) |
Ending balance | (49.5) | (45.5) |
Foreign Currency Translation Adjustments | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | (45.6) | (53.9) |
Other comprehensive (loss) income before reclassifications | (8) | 5.5 |
Amounts reclassified from accumulated other comprehensive loss | (0.2) | (0.2) |
Total other comprehensive (loss) income, net of tax | (8.2) | 5.3 |
Ending balance | (53.8) | (48.6) |
Pension and Post- Retirement Medical Benefits | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | 3.7 | 2.7 |
Other comprehensive (loss) income before reclassifications | 0 | 0 |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 |
Total other comprehensive (loss) income, net of tax | 0 | 0 |
Ending balance | 3.7 | 2.7 |
Derivative Financial Instruments | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | (0.4) | 1 |
Other comprehensive (loss) income before reclassifications | 1.6 | (0.2) |
Amounts reclassified from accumulated other comprehensive loss | (0.6) | (0.4) |
Total other comprehensive (loss) income, net of tax | 1 | (0.6) |
Ending balance | $ 0.6 | $ 0.4 |
Income Taxes (Details)
Income Taxes (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
Income Tax Contingency [Line Items] | |
Unrecognized tax benefits, ending balance | $ 4.3 |
Unrecognized tax benefits, income tax penalties and interest accrued, total | 0.5 |
Unrecognized tax benefits | $ 3.9 |
Minimum | |
Income Tax Contingency [Line Items] | |
Open tax year, term (year) | 3 years |
Maximum | |
Income Tax Contingency [Line Items] | |
Open tax year, term (year) | 5 years |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | ||
Share-based payment arrangement, expense | $ 3.2 | $ 1.2 |
Share-based payment arrangement, tax benefit (expense) | $ 2.4 | $ (0.1) |
Earnings Per Share - Computatio
Earnings Per Share - Computations of Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Numerator: | ||
Net income | $ 28.4 | $ 24.3 |
Denominator: | ||
Basic - weighted average shares outstanding (in shares) | 18,665,570 | 18,449,430 |
Effect of dilutive securities | 412,197 | 232,838 |
Diluted - weighted average shares outstanding (in shares) | 19,077,767 | 18,682,268 |
Basic earnings per share (in dollars per share) | $ 1.52 | $ 1.32 |
Diluted earnings per share (in dollars per share) | $ 1.49 | $ 1.30 |
Earnings Per Share - Narrative
Earnings Per Share - Narrative (Details) - shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Earnings Per Share [Abstract] | ||
Antidilutive securities (in shares) | 37,508 | 393,242 |