10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

_________________________________________________

FORM 10-Q

(Mark one)
	x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal quarter ended December 31, 2017

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to

Commission File Number: 001-35475

_________________________________________________

REXNORD CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	20-5197013
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
247 Freshwater Way, Suite 300, Milwaukee, WI	53204
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (414) 643-3739

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No   o

Indicate by checkmark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	o
Non-accelerated filer	o	Smaller reporting company	o
		Emerging growth company	o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  o

Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2).    Yes  o    No   x

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. 

Class	Outstanding at January 26, 2018
Rexnord Corporation Common Stock, $0.01 par value per share	103,978,699 shares

TABLE OF CONTENTS

Part I FINANCIAL INFORMATION
Item 1.	Financial Statements	4
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	39
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	47
Item 4.	Controls and Procedures	47
Part II OTHER INFORMATION
Item 1.	Legal Proceedings	48
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	48
Item 6.	Exhibits	48
Signatures		49

2

Private Securities Litigation Reform Act Safe Harbor Statement

Our disclosure and analysis in this report concerning our operations, cash flows and financial position, including, in particular, the likelihood of our success in developing and expanding our business and the realization of sales from our backlog, include forward-looking statements. Statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates” and similar expressions are forward-looking statements. Although these statements are based upon reasonable assumptions, including projections of orders, sales, operating margins, earnings, cash flows, research and development costs, working capital and capital expenditures, they are subject to risks and uncertainties that are described more fully herein and in our Annual Report on Form 10-K for the year ended March 31, 2017, in Part I, Item 1A, “Risk Factors” and in Part I under the heading "Cautionary Notice Regarding Forward-Looking Statements." Accordingly, we can give no assurance that we will achieve the results anticipated or implied by our forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

General

Our fiscal year is the year ending March 31 of the corresponding calendar year. For example, our fiscal year 2018, or fiscal 2018, means the period from April 1, 2017 to March 31, 2018, and the third quarter of fiscal 2018 and 2017 means the fiscal quarters ended December 31, 2017 and December 31, 2016, respectively.

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PART I - FINANCIAL INFORMATION

ITEM  1. FINANCIAL STATEMENTS

Rexnord Corporation and Subsidiaries

Condensed Consolidated Balance Sheets

(in Millions, except share amounts)

(Unaudited)

	December 31, 2017			March 31, 2017
Assets
Current assets:
Cash and cash equivalents	$	234.8		$	490.1
Receivables, net	313.1			322.9
Inventories	349.9			314.9
Other current assets	57.1			50.2
Total current assets	954.9			1,178.1
Property, plant and equipment, net	389.3			400.9
Intangible assets, net	567.9			558.6
Goodwill	1,353.8			1,318.2
Other assets	84.1			83.5
Total assets	$	3,350.0		$	3,539.3
Liabilities and stockholders' equity
Current liabilities:
Current maturities of debt	$	0.2		$	16.5
Trade payables	199.6			197.8
Compensation and benefits	52.4			54.3
Current portion of pension and postretirement benefit obligations	4.4			4.3
Other current liabilities	126.7			127.4
Total current liabilities	383.3			400.3
Long-term debt	1,322.9			1,606.2
Pension and postretirement benefit obligations	170.9			174.4
Deferred income taxes	146.2			208.8
Other liabilities	72.6			79.0
Total liabilities	2,095.9			2,468.7
Stockholders' equity:
Preferred stock, $0.01 par value; 10,000,000 shares authorized; shares of 5.75% Series A Mandatory Convertible Preferred Stock issued and outstanding: 402,500 at December 31, 2017 and March 31, 2017	—			—
Common stock, $0.01 par value; 200,000,000 shares authorized; shares issued and outstanding: 103,934,204 at December 31, 2017 and 103,600,540 at March 31, 2017	1.0			1.0
Additional paid-in capital	1,270.1			1,262.1
Retained earnings (deficit)	75.8			(55.5		)
Accumulated other comprehensive loss	(92.8		)	(137.0		)
Total stockholders' equity	1,254.1			1,070.6
Total liabilities and stockholders' equity	$	3,350.0		$	3,539.3

See notes to the condensed consolidated financial statements.

4

Rexnord Corporation and Subsidiaries

Condensed Consolidated Statements of Operations

(in Millions, except share and per share amounts)

(Unaudited)

	Third Quarter Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Net sales	$	492.3		$	451.8		$	1,490.8		$	1,414.6
Cost of sales	309.4			298.8			943.6			922.2
Gross profit	182.9			153.0			547.2			492.4
Selling, general and administrative expenses	107.3			99.9			326.6			313.1
Restructuring and other similar charges	3.8			11.7			11.6			21.7
Amortization of intangible assets	8.6			8.6			24.8			33.7
Income from operations	63.2			32.8			184.2			123.9
Non-operating expense:
Interest expense, net	(18.7		)	(22.9		)	(58.9		)	(69.4		)
Loss on the extinguishment of debt	(11.9		)	(7.8		)	(11.9		)	(7.8		)
Other expense, net	(1.0		)	(0.7		)	(2.5		)	(3.3		)
Income before income taxes	31.6			1.4			110.9			43.4
Benefit for income taxes	(50.0		)	(1.8		)	(27.0		)	(3.3		)
Net income	81.6			3.2			137.9			46.7
Dividends on preferred stock	(5.8		)	(1.5		)	(17.4		)	(1.5		)
Net income attributable to Rexnord common stockholders	$	75.8		$	1.7		$	120.5		$	45.2
Net income per share attributable to Rexnord common stockholders:
Basic	$	0.73		$	0.02		$	1.16		$	0.44
Diluted	$	0.67		$	0.02		$	1.13		$	0.43
Weighted-average number of shares outstanding (in thousands):
Basic	103,964			103,113			103,824			102,514
Diluted	122,017			104,558			122,363			104,481

Rexnord Corporation and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(in Millions)

(Unaudited)

	Third Quarter Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Net income	$	81.6		$	3.2		$	137.9		$	46.7
Other comprehensive income:
Foreign currency translation adjustments	7.5			(33.5		)	41.6			(33.4		)
Change in unrealized losses on interest rate derivatives, net of tax	0.7			3.3			3.6			5.6
Change in pension and postretirement defined benefit plans, net of tax	(0.4		)	(0.3		)	(1.0		)	(0.9		)
Other comprehensive income (loss), net of tax	7.8			(30.5		)	44.2			(28.7		)
Total comprehensive income (loss)	$	89.4		$	(27.3	)	$	182.1		$	18.0

See notes to the condensed consolidated financial statements.

5

Rexnord Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(in Millions)

(Unaudited)

	Nine Months Ended
	December 31, 2017			December 31, 2016
Operating activities
Net income	$	137.9		$	46.7
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	40.5			45.4
Amortization of intangible assets	24.8			33.7
Amortization of deferred financing costs	1.4			1.9
Loss on the extinguishment of debt	11.9			7.8
Non-cash asset impairment	—			1.6
Loss on dispositions of long-lived assets	0.4			0.2
Deferred income taxes	(76.2		)	(15.9		)
Other non-cash charges	3.0			(3.3		)
Stock-based compensation expense	15.9			9.8
Changes in operating assets and liabilities:
Receivables	11.3			33.1
Inventories	(26.0		)	(5.1		)
Other assets	(6.3		)	(7.2		)
Accounts payable	(5.8		)	(21.4		)
Accruals and other	(10.9		)	(5.2		)
Cash provided by operating activities	121.9			122.1
Investing activities
Expenditures for property, plant and equipment	(25.1		)	(44.0		)
Acquisitions, net of cash acquired	(50.0		)	(213.7		)
Proceeds from dispositions of long-lived assets	5.5			1.9
Cash used for investing activities	(69.6		)	(255.8		)
Financing activities
Proceeds from borrowings of long-term debt	1,325.0			1,590.3
Repayments of long-term debt	(1,603.2		)	(1,881.8		)
Proceeds from borrowings of short-term debt	—			16.1
Repayments of short-term debt	(24.3		)	(19.5		)
Payment of debt issuance costs	(9.0		)	(10.6		)
Proceeds from exercise of stock options	2.9			9.6
Proceeds from financing lease obligations	5.8			—
Deferred acquisition payment	—			(5.7		)
Proceeds from issuance of preferred stock, net of direct offering costs	—			390.2
Payments of dividend on preferred stock	(17.4		)	—
Cash (used for) provided by financing activities	(320.2		)	88.6
Effect of exchange rate changes on cash and cash equivalents	12.6			(10.2		)
Decrease in cash and cash equivalents	(255.3		)	(55.3		)
Cash and cash equivalents at beginning of period	490.1			484.6
Cash and cash equivalents at end of period	$	234.8		$	429.3

See notes to the condensed consolidated financial statements.

6

Rexnord Corporation and Subsidiaries

Notes to Condensed Consolidated Financial Statements

December 31, 2017

(Unaudited)

1. Basis of Presentation and Significant Accounting Policies

The unaudited condensed consolidated financial statements included herein have been prepared by Rexnord Corporation ("Rexnord" or the "Company") in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading.

In the opinion of management, the condensed consolidated financial statements include all adjustments necessary for a fair presentation of the results of operations for the interim periods. Results for the interim periods are not necessarily indicative of results that may be expected for the fiscal year ending March 31, 2018. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company's fiscal 2017 Annual Report on Form 10-K.

The Company

Rexnord is a growth-oriented, multi-platform industrial company with what it believes to be leading market shares and highly-trusted brands that serve a diverse array of global end markets. The Company's heritage of innovation and specification have allowed it to provide highly-engineered, mission-critical solutions to customers for decades and affords it the privilege of having long-term, valued relationships with market leaders. The Company operates in a disciplined way and the Rexnord Business System (“RBS”) is its operating philosophy. Grounded in the spirit of continuous improvement, RBS creates a scalable, process-based framework that focuses on driving superior customer satisfaction and financial results by targeting world-class operating performance throughout all aspects of its business.

The Process & Motion Control platform designs, manufactures, markets and services a comprehensive range of specified, highly-engineered mechanical components used within complex systems where our customers' reliability requirements and costs of failure or downtime are high. The Process & Motion Control portfolio includes motion control products, shaft management products, aerospace components, and related value-added services.

The Water Management platform designs, procures, manufactures, and markets products that provide and enhance water quality, safety, flow control and conservation. The Water Management product portfolio includes professional grade water control and safety, water distribution and drainage, finish plumbing, and site works products for primarily nonresidential buildings and flow control products for water and wastewater treatment infrastructure markets.

Recent Accounting Pronouncements

In August 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-12, Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12"), which expands and refines hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. ASU 2017-12 is effective for the beginning of the Company's fiscal 2020, with early adoption permitted, and must be applied prospectively. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.    

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). The amendments in ASU 2017-04 allow companies to apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 is effective for the beginning of the Company's fiscal 2021, with early adoption permitted, and must be applied prospectively. The Company is currently evaluating the timing of adoption; however, it does not believe the adoption of ASU 2017-04 will have a material impact on the Company's consolidated financial statements.

In February 2015, the FASB issued ASU 2016-02, Leases (Topic 842) ("ASU 2016-02''), which requires lessees to recognize lease assets and lease liabilities for all leases on the balance sheets. ASU 2016-02 is effective beginning for the Company's fiscal 2020 and interim periods included therein on a modified retrospective basis. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.    

7

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory ("ASU 2015-11"). ASU 2015-11 requires inventory to be measured at the lower of cost and net realizable value, which is defined as the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. Under existing guidance, net realizable value is one of several calculations needed to measure inventory at lower of cost or market and as such, the new guidance reduces the complexity in measurement. The Company adopted ASU No. 2015-11 prospectively effective April 1, 2017 and there was no impact to the Company's condensed consolidated financial statements.

In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,which changes how employers that sponsor defined benefit pension or other postretirement benefit plans present the net periodic benefit cost in the income statement. The new guidance requires the service cost component of net periodic benefit cost to be presented in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period with only the service cost component eligible for capitalization in assets. Other components of the net periodic benefit cost are to be stated separately from the line item(s) that includes the service cost and outside of operating income. The standard is required to be adopted for annual periods beginning after December 15, 2017, including interim periods within that annual period, which is the Company's fiscal year 2019. The amendment is to be applied retrospectively. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"), now referred to as Accounting Standards Codification ("ASC") Topic 606 ("ASC 606"), in order to develop a common revenue standard for U.S. GAAP and International Financial Reporting Standards. The guidance specifies revenue should be recognized in an amount that reflects the consideration the company expects to be entitled to in exchange for the transfer of promised goods or services to customers. The guidance provides a five-step process that entities should follow in order to achieve that core principal. ASC 606 will be effective for the Company on April 1, 2018. Companies can use either a full retrospective or modified retrospective method to adopt the standard. Under the full retrospective method, the requirements of the new standard are applied to contracts for each prior reporting period presented and the cumulative effect of applying the standard is recognized in the earliest period presented. Under the modified retrospective method, prior periods are not updated to be presented on an accounting basis that is consistent with information for fiscal 2019. Rather, a cumulative adjustment for the effects of applying the new standard to periods prior to fiscal 2019 is recorded to retained earnings as of April 1, 2018. The Company expects to adopt the new standard using the modified retrospective approach.

The Company is assessing the impact of the new revenue standard on its consolidated financial statements by reviewing its current accounting policies and practices, including detailed reviews of customer contracts, to identify potential differences that would result from applying the requirements of the new standard to its revenue contracts. In addition, ASC 606 will require more comprehensive disclosures about revenue streams and contracts with customers. The Company is currently evaluating potential changes to its processes, information systems and internal controls related to the preparation of disclosures required under ASC 606. The Company will provide additional disclosure as its ongoing assessment progresses.

8

2. Acquisitions

Fiscal Year 2018 Acquisitions

On October 4, 2017, the Company acquired World Dryer Corporation (“World Dryer”) for a cash purchase price of $50.0 million, excluding transaction costs and net of cash acquired. World Dryer is a leading global manufacturer of commercial electric hand dryers. This acquisition broadened the product portfolio of the Company's existing Water Management platform and is expected to bring even greater value to commercial building owners in the form of lower operating costs.

The Company's results of operations include the acquired operations subsequent to October 4, 2017. Pro-forma results of operations and certain other U.S. GAAP disclosures related to the World Dryer acquisition have not been presented because they are not material to the Company's condensed consolidated statements of operations and condensed consolidated balance sheets.

The acquisition of World Dryer was accounted for as a business combination and recorded by allocating the purchase price to the fair value of assets acquired and liabilities assumed at the acquisition date. The excess of the acquisition purchase price over the fair value assigned to the assets acquired and liabilities assumed was recorded as goodwill. The preliminary purchase price allocation resulted in non-tax deductible goodwill of $25.8 million, other intangible assets of$28.1 million(includes tradenames of$7.0 millionand$21.1 millionof customer relationships) and other net liabilities of$3.9 million. The purchase price allocation is preliminary and subject to fair value adjustments that will be completed within the one year period following the acquisition date.

During the third quarter of fiscal 2018, the Company entered into a definitive agreement to acquire Centa Power Transmission (Centa Antriebe Kirschey GmbH) ("Centa") for an estimated purchase price of approximately €118 million. Centa, headquartered in Haan, Germany, is a leading manufacturer of premium flexible couplings and drive shafts for industrial, marine, rail and power generation applications. The acquisition of Centa will add complementary product lines to the Company's existing Process & Motion Control platform. The acquisition of Centa is subject to customary closing conditions and is expected to close during the fourth quarter of fiscal 2018. The Company's results of operation will not include Centa until the transaction is finalized.

Fiscal Year 2017 Acquisitions

On June 1, 2016, the Company acquired Cambridge International Holdings Corp. ("Cambridge") for a cash purchase price of $213.4 million. The purchase price consisted of an enterprise value of $210.0 million, excluding transaction costs and net of cash acquired, plus additional consideration of $3.4 million related to the acquisition of certain tax benefits and real property classified as held for sale at the acquisition date. Cambridge, with operations in Cambridge, Maryland and Matamoros, Mexico, is one of the world's largest suppliers of metal conveying and engineered woven metal solutions, primarily used in food processing end markets, as well as in architectural, packaging and filtration applications. The acquisition of Cambridge expanded the Company's presence in consumer-driven end markets in the Process & Motion Control platform.

The Company's results of operations include the acquired operations subsequent to June 1, 2016. Pro-forma results of operations and certain other U.S. GAAP disclosures related to the Cambridge acquisition have not been presented because they are not material to the Company's condensed consolidated statements of operations and condensed consolidated balance sheets.

The acquisition of Cambridge was accounted for as a business combination and recorded by allocating the purchase price to the fair value of assets acquired and liabilities assumed at the acquisition date. The excess of the acquisition purchase price over the fair value assigned to the assets acquired and liabilities assumed was recorded as goodwill. The purchase price allocation resulted in non-tax deductible goodwill of $129.4 million, other intangible assets of $80.6 million (includes tradenames of $16.8 million, customer relationships of $58.3 million and patents of $5.5 million) and other net assets of $3.4 million.

In fiscal 2017, the Company acquired the remaining non-controlling interest in aWater Management joint venturefor a cash purchase price of approximately$0.3 million, net of cash acquired and excluding transaction costs. The acquisition of the remaining minority interest was not material to the Company's condensed consolidated statements of operations or financial position.

9

3. Restructuring and Other Similar Charges

During fiscal 2018, the Company has continued to execute various restructuring actions. These initiatives were implemented to drive efficiencies and reduce operating costs while also modifying the Company's footprint to reflect changes in the markets it serves, the impact of acquisitions on the Company's overall manufacturing capacity and the refinement of its overall product portfolio. These restructuring actions primarily resulted in workforce reductions, lease termination costs, and other facility rationalization costs. Management expects to continue executing initiatives to optimize its operating margin and manufacturing footprint, as well as select product-line rationalizations. As such, the Company expects further expenses related to workforce reductions, potential impairment or accelerated depreciation of assets, lease termination costs, and other facility rationalization costs. The Company's restructuring plans are preliminary and related expenses are not yet estimable.

The following table summarizes the Company's restructuring and other similar charges during the three and nine months endedDecember 31, 2017 and December 31, 2016 by operating segment (in millions):

	Restructuring and Other Similar Charges Three Months Ended December 31, 2017
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	0.6	$	0.6	$	1.2
Contract termination and other associated costs	2.4		0.2		2.6
Total restructuring and other similar charges	$	3.0	$	0.8	$	3.8

	Restructuring and Other Similar Charges Nine Months Ended December 31, 2017
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	2.5	$	3.3	$	5.8
Contract termination and other associated costs	5.2		0.6		5.8
Total restructuring and other similar charges	$	7.7	$	3.9	$	11.6

	Restructuring and Other Similar Charges Three Months Ended December 31, 2016
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	5.1	$	1.7	$	6.8
Asset impairment charges (1)	1.6		—		1.6
Contract termination and other associated costs	1.9		1.4		3.3
Total restructuring and other similar charges	$	8.6	$	3.1	$	11.7

	Restructuring and Other Similar Charges Nine Months Ended December 31, 2016
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	9.6	$	5.4	$	15.0
Asset impairment charges (1)	1.6		—		1.6
Contract termination and other associated costs	3.4		1.7		5.1
Total restructuring and other similar charges	$	14.6	$	7.1	$	21.7

____________________

(1) In connection with the ongoing supply chain optimization and footprint repositioning initiatives, the Company has taken several actions to consolidate existing manufacturing facilities and rationalize its product offerings. These actions require the Company to assess whether the carrying amount of impacted long-lived assets will be recoverable as well as whether the remaining useful lives require adjustment. The Company recognized impairment charges associated with these assets during the three and nine months ended of fiscal 2017, in the amount of $1.6 million. The impairment was determined utilizing independent appraisals of the assets, classified as Level 3 inputs within the Fair Value hierarchy. Refer to Note 13, Fair Value Measurements for additional information.

The following table summarizes the activity in the Company's restructuring accrual for the nine months endedDecember 31, 2017 (in millions):

10

	Employee termination benefits			Contract termination and other associated costs			Total
Restructuring accrual, March 31, 2017 (1)	$	11.0		$	1.0		$	12.0
Charges	5.8			5.8			11.6
Cash payments	(13.3		)	(6.6		)	(19.9		)
Restructuring accrual, December 31, 2017 (1)	$	3.5		$	0.2		$	3.7

____________________

(1)     The restructuring accrual is included in Other current liabilities in the condensed consolidated balance sheets.

In addition to the impairment charges recognized above, the Company recognized accelerated depreciation of zero and $1.0 million during the three and nine months endedDecember 31, 2017, respectively. The Company recognized accelerated depreciation of $3.8 million and $5.2 million during the three and nine months endedDecember 31, 2016, respectively. Accelerated depreciation is recorded within Cost of sales in the condensed consolidated statements of operations.

During fiscal 2016, the Company decided to exit the non-strategic product lines sold under the Rodney Hunt Fontaine ("RHF") tradename and the Company completed the exit of the RHF product line in fiscal 2017. The Company evaluated the requirements for the presentation of discontinued operations in connection with the decision to exit its flow-control gate product line and determined the product line did not meet the definition provided within the authoritative literature as discontinued operations. Pre-tax loss from operations associated with the RHF product line was $2.2 million and $6.7 million in the three and nine months endedDecember 31, 2016, respectively. Pre-tax loss included restructuring and other similar charges of $0.3 million and $1.9 million in the three and nine months endedDecember 31, 2016, respectively.

11

4. Income Taxes

On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (“U.S. Tax Reform”). U.S. Tax Reform incorporates significant changes to U.S. corporate income tax laws including, among other things, a reduction in the statutory federal corporate income tax rate from 35% to 21%, an exemption for dividends received from certain foreign subsidiaries, a one-time repatriation tax on deemed repatriated earnings from foreign subsidiaries, immediate expensing of certain depreciable tangible assets, limitations on the deduction for net interest expense and certain executive compensation and the repeal of the Domestic Production Activities Deduction ("DPAD"). The majority of these changes will be effective for the Company’s fiscal year beginning April 1, 2018. However, the corporate income tax rate reduction is effective January 1, 2018. As such, the Company’s effective statutory federal corporate income tax rate for the tax year ending March 31, 2018 will be 31.55%. In addition, the one-time repatriation tax will be recognized by the Company for the tax year ending March 31, 2018.

Under ASC Topic 740, Income Taxes ("ASC 740"), a company is generally required to recognize the effect of changes in tax laws in its financial statements in the period in which the legislation is enacted. U.S. income tax laws are deemed to be effective on the date the president signs tax legislation. The president signed the U.S. Tax Reform legislation on December 22, 2017. As such, the Company is required to recognize the related impacts to the financial statements in the quarter ended December 31, 2017. In acknowledgment of the substantial changes incorporated in the U.S. Tax Reform, in conjunction with the timing of the enactment being just weeks before the majority of the provisions became effective, the SEC staff issued Staff Accounting Bulletin ("SAB") 118 to provide certain guidance in determining the accounting for income tax effects of the legislation in the accounting period of enactment as well as provide a measurement period (similar to that used when accounting for business combinations) within which to finalize and reflect such final effects associated with U.S. Tax Reform. Further, SAB 118 summarizes a three-step approach to be applied each reporting period within the overall measurement period: (1) amounts should be reflected in the period including the date of enactment for those items which are deemed to be complete (i.e. all information is available and appropriately analyzed to determine the applicable financial statement impact), (2) to the extent the effects of certain changes due to U.S. Tax Reform for which the accounting is not deemed complete but for which a reasonable estimate can be determined, such provisional amount(s) should be reflected in the period so determined and adjusted in subsequent periods as such effects are finalized and (3) to the extent a reasonable estimate cannot be determined for a specific effect of the tax law change associated with U.S. Tax Reform, no provisional amount should be recorded but rather, continue to apply ASC 740 based upon the tax law in effect prior to the enactment of U.S. Tax Reform. Such measurement period is deemed to end when all necessary information has been obtained, prepared and analyzed such that a final accounting determination can be concluded, but in no event should the period extend beyond one year.

In consideration of this guidance, the Company has obtained, prepared and analyzed various information associated with the enactment of U.S. Tax Reform. Based upon this review, the Company has recognized a discrete estimated net income tax benefit with respect to U.S Tax Reform for the third quarter of fiscal 2018 of $54.8 million. This net income tax benefit reflects a $62.2 million net estimated income tax benefit associated with the remeasurement of the Company’s net U.S. deferred tax liability (including consideration of executive compensation limitations under U.S. Tax Reform), partiality offset with a $7.4 million estimated income tax expense associated with the impact of the deemed repatriated earnings from the Company’s foreign subsidiaries, including the one-time repatriation tax of $3.0 million. Due to the Company’s fiscal year-end of March 31, 2018 and the timing of the various technical provisions provided for under U.S. Tax Reform, the financial statement impacts recorded in the third quarter of fiscal 2018 relating to U.S. Tax Reform are not deemed to be complete but rather are deemed to be reasonable, provisional estimates based upon the current available information. For example, the remeasurement of the net U.S. deferred tax liability cannot be complete until the underlying timing differences are known, and such timing differences cannot be known until March 31, 2018. Similarly, the Company was required to use certain estimated annual amounts in conjunction with determining the impact of the one-time repatriation tax. Although the Company believes the net income tax benefit recognized in the third quarter of fiscal 2018 as outlined above is a reasonable estimate based upon the available information and analysis completed, these related amounts will change based upon actual results occurring in the quarter and fiscal year ending March 31, 2018. As such, the Company will update and finalize the accounting for the tax effect of the enactment of U.S. Tax Reform in future quarters in accordance with the guidance as outlined in SAB 118, as deemed necessary.

The provision for income taxes for all periods presented is based on an estimated effective income tax rate for the respective full fiscal years. As a result of enacted U.S. Tax Reform, the Company's estimated effective income tax rate incorporated the reduced federal statutory income tax rate of 31.55%, resulting in an income tax benefit of approximately $2.1 million for the third quarter (as well as the first nine months) of fiscal 2018. This benefit is in addition to the $54.8 million discrete estimated income tax benefit recorded in association with U.S. Tax Reform, as discussed above. The estimated annual effective income tax rate is determined excluding the effect of significant discrete items or items that are reported net of their related tax effects. The tax effect of significant discrete items is reflected in the period in which they occur. The Company's income tax provision is impacted by a number of factors, including the amount of taxable earnings derived in foreign jurisdictions with tax rates that are generally lower than the U.S. federal statutory rate, state tax rates in the jurisdictions where the Company does business and the Company's ability to utilize various tax credits and net operating loss (“NOL”) carryforwards.

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The Company regularly reviews its deferred tax assets for recoverability and establishes valuation allowances based on historical losses, projected future taxable income and the expected timing of the reversals of existing temporary differences, as deemed appropriate. In addition, all other available positive and negative evidence is taken into consideration for purposes of determining the proper balances of such valuation allowances. As a result of this review, the Company continues to maintain valuation allowances against the deferred tax assets relating to certain foreign and state net operating loss carryforwards. Future changes to the balances of these valuation allowances, as a result of this continued review and analysis by the Company, could result in a material impact to the financial statements for such period of change.

The income tax benefit was $50.0 million in the third quarter of fiscal 2018 compared to an income tax benefit of $1.8 million in the third quarter of fiscal 2017. The effective income tax rate for the third quarter of fiscal 2018 was (158.2)% versus (128.6)% in the third quarter of fiscal 2017. The income tax benefit recorded on income before income taxes for the third quarter of fiscal 2018 was primarily due to the recognition of net income tax benefits associated with the enactment of U.S. Tax Reform, the recognition of net tax benefits associated with the reduction in the tax liability originally recorded on the expatriation of certain foreign branch assets, and the net tax benefits associated with U.S. research and development credits and the DPAD. The income tax benefit recorded on income before income taxes for the third quarter of fiscal 2017 was primarily due to excess tax benefits associated with share-based payments, the recognition of net tax benefits associated with U.S. research and development credits and the DPAD, partially offset with the recognition of income tax expense relating to various foreign income tax audits.

The income tax benefit recorded in the first nine months of fiscal 2018 was $27.0 million compared to an income tax benefit of $3.3 million in the first nine months of fiscal 2017. The effective income tax rate for the first nine months of fiscal 2018 was (24.3)% versus (7.6)% in the first nine months of fiscal 2017. The income tax benefit recorded on income before income taxes for the first nine months of fiscal 2018 was primarily due to the recognition of net income tax benefits associated with the enactment of U.S. Tax Reform, the recognition of net tax benefits associated with the reduction in the tax liability originally recorded on the expatriation of certain foreign branch assets, and the net tax benefits associated with U.S. research and development credits and the DPAD. The income tax benefit recorded on income before income taxes for the first nine months of fiscal 2017 was primarily due to excess tax benefits associated with share-based payments, the recognition of net tax benefits associated with U.S. research and development credits, the recognition of a worthless stock and bad debt deduction for U.S. income tax purposes relating to an insolvent foreign subsidiary and the recognition of excess U.S. foreign tax credits, partially offset with the recognition of income tax expense relating to various foreign income tax audits.

At December 31, 2017, the Company had a $19.0 million liability for unrecognized net income tax benefits. At March 31, 2017, the Company’s total liability for unrecognized net income tax benefits was $18.1 million. The Company recognizes accrued interest and penalties related to unrecognized income tax benefits in income tax expense. As of December 31, 2017 and March 31, 2017, the total amount of gross, unrecognized income tax benefits included $5.5 million and $4.7 million of accrued interest and penalties, respectively. The Company recognized $0.3 million of net interest and penalties as income tax expense during both the nine months endedDecember 31, 2017 and December 31, 2016.

The Company conducts business in multiple locations within and outside the U.S. Consequently, the Company is subject to periodic income tax examinations by domestic and foreign income tax authorities. Currently, the Company is undergoing routine, periodic income tax examinations in both domestic and foreign jurisdictions (including a review of a few specific items on certain corporate income tax returns of the Company’s Netherlands subsidiaries for the tax years ended March 31, 2011 through 2015). In addition, the U.S. Internal Revenue Service is currently examining the Company’s U.S. consolidated federal income tax return and related amended return for the tax year ended March 31, 2015. During the third quarter of fiscal 2017, the Company completed an examination of certain of its Italian subsidiaries’ corporate income tax returns for the tax years ended March 31, 2014 through 2016 and paid approximately $0.7 million upon the conclusion of such examination. In addition, during the fourth quarter of fiscal 2017, the Company completed an examination of certain of its German subsidiaries’ corporate income and trade tax returns for the tax years ended March 31, 2011 through 2014 and paid approximately $0.4 million upon conclusion of such examination. It appears reasonably possible that the amounts of unrecognized income tax benefits could change in the next twelve months upon conclusion of the Company’s current ongoing examinations; however, any potential payments of income tax, interest and penalties are not expected to be significant to the Company's consolidated financial statements. With certain exceptions, the Company is no longer subject to U.S. federal income tax examinations for tax years ending prior to March 31, 2015, state and local income tax examinations for years ending prior to fiscal 2014 or significant foreign income tax examinations for years ending prior to fiscal 2013. With respect to the Company's U.S. federal NOL carryforward (which was fully utilized for the tax year ended March 31, 2015), the short tax period from July 21, 2006 to March 31, 2007 (due to a prior change in control of the Company) and the tax years ended March 31, 2008 through March 31, 2013 are open under statutes of limitations; whereby, the Internal Revenue Service may not adjust the income tax liability for these years, but may reduce the NOL carryforward and any other tax attribute carryforwards to currently open tax years.

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5. Earnings per Share

The following table presents the basis for the basic and diluted income per share computations (in millions, except share amounts):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Basic net income per share:
Numerator:
Net income	$	81.6		$	3.2		$	137.9		$	46.7
Less: Dividends on preferred stock	(5.8		)	(1.5		)	(17.4		)	(1.5		)
Net income attributable to Rexnord common stockholders	$	75.8		$	1.7		$	120.5		$	45.2
Denominator:
Weighted-average common shares outstanding, basic	103,964			103,113			103,824			102,514
Net income per share attributable to Rexnord common stockholders - basic	$	0.73		$	0.02		$	1.16		$	0.44
Diluted net income per share:
Numerator:
Net income	$	81.6		$	3.2		$	137.9		$	46.7
Less: Dividends on preferred stock	—			(1.5		)	—			(1.5		)
Net income attributable to Rexnord common stockholders (1)	$	81.6		$	1.7		$	137.9		$	45.2
Denominator:
Weighted-average common shares outstanding, basic	103,964			103,113			103,824			102,514
Effect of dilutive equity awards	1,966			1,445			1,845			1,967
Preferred stock under the "if-converted" method (1)	16,087			—			16,694			—
Weighted-average common shares outstanding, diluted	122,017			104,558			122,363			104,481
Net income per share attributable to Rexnord common stockholders - dilutive	$	0.67		$	0.02		$	1.13		$	0.43

____________________

(1) Following the issuance of the 5.75% Series A Mandatory Convertible Preferred Stock ("Series A Preferred Stock") in the third quarter of fiscal 2017, the Company’s diluted net income per share is computed using the “if-converted” method. The "if-converted" method is utilized only when such calculation is dilutive to earnings per share using the treasury stock method. Under the “if-converted” method, diluted net income per share is calculated under the assumption that the shares of Series A Preferred Stock have been converted into shares of the Company’s common stock as of the beginning of the respective period and therefore no dividends are provided to holders of the Series A Preferred Stock. During the three and nine months ended December 31, 2017, the computation of diluted net income per share was calculated utilizing the "if-converted" method. During the three and nine months ended December 31, 2016, the computation of diluted net income per share does not include shares of preferred stock that are convertible into a weighted average of 5.1 million million and 1.7 million shares of common stock, respectively, due to their anti-dilutive effects.  

The computation of diluted net income per share for the three and nine months endedDecember 31, 2017 excludes 2.8 million and 2.7 million shares, respectively, related to equity awards due to their anti-dilutive effects. The computation of diluted net income per share for the three and nine months endedDecember 31, 2016 excludes 5.5 million and 5.3 million shares, respectively, related to equity awards due to their anti-dilutive effects.

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6. Stockholders' Equity

Stockholders' equity consists of the following (in millions):

	Preferred Stock		Common Stock		Additional Paid-In Capital			Retained (Deficit) Earnings			Accumulated Other Comprehensive (Loss) Income			Total Stockholders’ Equity
Balance at March 31, 2017	$	0.0	$	1.0	$	1,262.1		$	(55.5	)	$	(137.0	)	$	1,070.6
Total comprehensive income	—		—		—			137.9			44.2			182.1
Stock-based compensation expense	—		—		15.9			—			—			15.9
Exercise of stock options	—		—		2.9			—			—			2.9
Preferred stock dividends	—		—		(10.8		)	(6.6		)	—			(17.4		)
Balance at December 31, 2017	$	0.0	$	1.0	$	1,270.1		$	75.8		$	(92.8	)	$	1,254.1

Preferred Stock

During the third quarter of fiscal 2017, the Company issued 8,050,000 depositary shares, each of which represents a 1/20th interest in a share of Series A Preferred Stock, for an offering price of $50 per depository share. The Company issued an aggregate of 402,500 shares of Series A Preferred Stock in connection therewith. Unless converted earlier, each share of Series A Preferred Stock will convert automatically on the mandatory conversion date, which is November 15, 2019, into between 39.702 and 47.642 shares of the Company’s common stock, subject to customary anti-dilution adjustments. The number of shares of common stock issuable upon conversion will be determined based on a defined average volume weighted average price per share of the Company’s common stock preceding November 15, 2019. Holders of the Series A Preferred Stock may elect on a voluntary basis to convert their shares into common stock at the minimum exchange ratio at any time prior to the mandatory conversion date.

Dividends accumulate from the issuance date. Rexnord may pay such dividends in cash or, subject to certain limitations, by delivery of shares of the Company's common stock or through any combination of cash and shares of the Company's common stock as determined by the Company in its sole discretion. Any unpaid dividends will continue to accumulate. Dividends are payable quarterly, ending on November 15, 2019. The shares of Series A Preferred Stock have a liquidation preference of $1,000 per share, plus accrued but unpaid dividends. With respect to dividend and liquidation rights, the Series A Preferred Stock ranks senior to the Company's common stock and junior to all existing and future indebtedness.

The net proceeds from the offering during the nine months ended December 31, 2016 were approximately $390.2 million. The Company used $195.0 million of the proceeds to prepay a portion of the then-outstanding term loan indebtedness under its credit agreement, with the remainder retained for general corporate purposes. During the three and nine months ended December 31, 2017, the Company paid $5.8 million and $17.4 million of dividends, respectively. As of December 31, 2017, there were no dividends in arrears on the Series A Preferred Stock.

Common Stock Repurchase Program

In fiscal 2015, the Company's Board of Directors approved a stock repurchase program (the "Repurchase Program") authorizing the repurchase of up to $200.0 million of the Company's common stock from time to time on the open market or in privately negotiated transactions. The Repurchase Program does not require the Company to acquire any particular amount of common stock and does not specify the timing of purchases or the prices to be paid; however, the program will continue until the maximum amount of dollars authorized have been expended or until it is modified or terminated by the Board. No shares were repurchased during the nine months endedDecember 31, 2017 or December 31, 2016. A total of approximately $160.0 million remained of the existing repurchase authority at December 31, 2017.

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7. Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss, net of tax, for the nine months endedDecember 31, 2017 are as follows (in millions):

	Interest Rate Derivatives			Foreign Currency Translation			Pension and Postretirement Plans			Total
Balance at March 31, 2017	$	(9.5	)	$	(99.3	)	$	(28.2	)	$	(137.0	)
Other comprehensive income before reclassifications	—			41.6			—			41.6
Amounts reclassified from accumulated other comprehensive loss	3.6			—			(1.0		)	2.6
Net current period other comprehensive income (loss)	3.6			41.6			(1.0		)	44.2
Balance at December 31, 2017	$	(5.9	)	$	(57.7	)	$	(29.2	)	$	(92.8	)

The following table summarizes the amounts reclassified from accumulated other comprehensive loss to net income during the three and nine months endedDecember 31, 2017 and December 31, 2016 (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016			Income Statement Line
Pension and other postretirement plans
Amortization of prior service credit	$	(0.5	)	$	(0.5	)	$	(1.5	)	$	(1.4	)	Selling, general and administrative expenses
Provision for income taxes	0.1			0.2			0.5			0.5
Total net of tax	$	(0.4	)	$	(0.3	)	$	(1.0	)	$	(0.9	)
Interest rate derivatives
Net realized losses on interest rate hedges	$	1.8		$	2.7		$	7.2		$	7.9		Interest expense, net
Benefit for income taxes	(1.5		)	(1.0		)	(3.6		)	(3.0		)
Total net of tax	$	0.3		$	1.7		$	3.6		$	4.9

8. Inventories

The major classes of inventories are summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Finished goods	$	153.7	$	139.9
Work in progress	47.4		44.4
Purchased components	81.4		74.0
Raw materials	59.2		47.7
Inventories at First-in, First-Out ("FIFO") cost	341.7		306.0
Adjustment to state inventories at Last-in, First-Out ("LIFO") cost	8.2		8.9
	$	349.9	$	314.9

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9. Goodwill and Intangible Assets

The changes in the net carrying value of goodwill for the nine months endedDecember 31, 2017 by operating segment are presented below (in millions):

	Process & Motion Control		Water Management		Consolidated
Net carrying amount as of March 31, 2017	$	1,068.8	$	249.4	$	1,318.2
Acquisitions (1)	—		25.8		25.8
Currency translation adjustment and other	3.0		6.8		9.8
Net carrying amount as of December 31, 2017	$	1,071.8	$	282.0	$	1,353.8

(1) Refer to footnote 2 for additional information regarding acquisitions.

The gross carrying amount and accumulated amortization for each major class of identifiable intangible assets as of December 31, 2017 and March 31, 2017 are as follows (in millions):

		December 31, 2017
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	47.5	$	(38.9	)	$	8.6
Customer relationships (including distribution network)	13 years	710.6		(498.3		)	212.3
Tradenames	12 years	37.1		(7.7		)	29.4
Intangible assets not subject to amortization - tradenames		317.6		—			317.6
Total intangible assets, net	13 years	$	1,112.8	$	(544.9	)	$	567.9
		March 31, 2017
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	47.0	$	(37.7	)	$	9.3
Customer relationships (including distribution network) (1)	13 years	685.8		(475.2		)	210.6
Tradenames (1)	12 years	29.5		(5.3		)	24.2
Intangible assets not subject to amortization - tradenames		314.5		—			314.5
Total intangible assets, net	13 years	$	1,076.8	$	(518.2	)	$	558.6

____________________

(1) Tradenames and customer relationships acquired during fiscal 2018 were both assigned a useful life of 14 years.

Intangible asset amortization expense totaled $8.6 million and $24.8 million for the three and nine months endedDecember 31, 2017, respectively. Intangible asset amortization expense totaled $8.6 million and $33.7 million for the three and nine months endedDecember 31, 2016, respectively.

The Company expects to recognize amortization expense on the intangible assets subject to amortization of $33.4 million in fiscal year 2018 (inclusive of $24.8 million of amortization expense recognized in the nine months endedDecember 31, 2017), $34.3 million in fiscal year 2019, $34.1 million in fiscal year 2020, $32.6 million in fiscal year 2021 and $28.3 million in fiscal year 2022.

During the third quarter ended December 31, 2017, the Company completed its annual evaluation of indefinite lived intangible assets (tradenames) and goodwill for impairment in accordance with ASC 350, Intangibles - Goodwill and Other. The fair value of the Company's indefinite lived intangible assets and reporting units were primarily estimated using an income valuation model (discounted cash flow) and market approach (guideline public company comparables), which indicated that the fair value of the Company's indefinite lived intangible assets and reporting units exceeded their carrying value; therefore, no impairment was present.

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10. Other Current Liabilities

Other current liabilities are summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Customer advances	$	10.5	$	10.9
Sales rebates	30.2		25.5
Commissions	6.3		6.3
Restructuring and other similar charges (1)	3.7		12.0
Product warranty (2)	7.5		7.5
Risk management (3)	9.6		8.9
Legal and environmental	4.5		4.4
Taxes, other than income taxes	7.1		10.5
Income tax payable	19.2		17.8
Interest payable	2.3		5.7
Other	25.8		17.9
	$	126.7	$	127.4

____________________

(1) See more information related to the restructuring obligations within Note 3, Restructuring and Other Similar Charges.

(2) See more information related to the product warranty obligations within Note 14, Commitments and Contingencies.

(3) Includes projected liabilities related to losses arising from automobile, general and product liability claims.

11. Long-Term Debt

Long-term debt is summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Term loan (1)	$	791.2	$	1,584.5
4.875% Senior notes due 2025 (2)	494.1		—
Other subsidiary debt (3)	37.8		38.2
Total	1,323.1		1,622.7
Less current maturities	0.2		16.5
Long-term debt	$	1,322.9	$	1,606.2

____________________

(1) Includes an unamortized original issue discount and debt issuance costs of $8.8 million and $17.9 million at December 31, 2017 and March 31, 2017, respectively.

(2) Includes an unamortized debt issuance costs of $5.9 million at December 31, 2017.

(3) Other subsidiary debt consists primarily of a $36.9 million loan payable associated with the New Market Tax Credit incentive program as of December 31, 2017 and March 31, 2017. The Company also invested an aggregate of $27.6 million in the form of a loan receivable. The aggregate loan receivable is presented within Other assets on the condensed consolidated balance sheets as of both December 31, 2017 and March 31, 2017. Also includes unamortized debt issuance costs of $0.5 million as of both December 31, 2017 and March 31, 2017.

Senior Secured Credit Facility

The Company’s Third Amended and Restated First Lien Credit Agreement (the “Credit Agreement”) is funded by a syndicate of banks and other financial institutions and provides for (i) a $800.0 million term loan facility and (ii) a $264.0 million revolving credit facility.

As of December 31, 2017, the Company was in compliance with all applicable covenants under the Credit Agreement, including compliance with a maximum permitted total net leverage ratio (the Company's sole financial maintenance covenant under the revolving credit facility discussed below) of 6.75 to 1.0. The Company's total net leverage ratio was 3.0 to 1.0 as of December 31, 2017.

Term Debt

On December 7, 2017, the Company entered into an Incremental Assumption Agreement (the “Amendment”) with Credit Suisse AG, Cayman Islands Branch, as administrative agent and the refinancing term lender, and the lenders party thereto, relating

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to the Credit Agreement. Prior to the Amendment, the Credit Agreement included a $1,606.4 million term loan facility (the “Prior Term Loan”).

The Amendment provided for a new term loan in the aggregate principal amount of $800.0 million (the “Term Refinancing Loan”). The proceeds of the Term Refinancing Loan were used, along with cash on hand and the net $500.0 million of proceeds from the Company’s issuance of the Notes (as defined below), to reduce the aggregate principal amount of the Prior Term Loan outstanding under the Credit Agreement to $800.0 million.

The Term Refinancing Loan has a maturity date of August 21, 2024 (extended from August 21, 2023 under the Prior Term Loan). The borrowings under the Term Refinancing Loan bear interest at either (i) London Interbank Offered Rate (“LIBOR”) (subject to a 0% floor) plus an applicable margin of 2.25% (which was reduced from 2.75%) or at an alternative base rate plus an applicable margin of 1.25% (which was reduced from 1.75%), or (ii.) if the borrowers have received a corporate rating equal to or higher than Ba3 (with at least a stable outlook) by Moody’s and BB- (with at least a stable outlook) by S&P, LIBOR (subject to a 0% floor) plus an applicable margin of 2.00% or an alternate base rate plus an applicable margin of 1.00%. At December 31, 2017, the borrowings under the Term Refinancing Loan had a weighted-average effective interest rate of 3.80%.

In accordance with ASC 470-50, Debt Modifications and Extinguishments (“ASC 470-50”), the Company recognized a $11.9 million loss on the debt extinguishment associated with the above transaction, which was comprised of $3.9 million of refinancing related costs, as well as a non-cash write-off of unamortized original issue discount and debt issuance costs associated with previously outstanding debt of $8.0 million. Additionally, the Company capitalized $0.8 million and $6.0 million of direct costs associated with the Term Refinancing Loan and Notes, respectively, which will be amortized over the life of the loans as interest expense using the effective interest method.

Revolving Debt Facility

The Credit Facility also includes a revolving credit facility, as noted above. Through the Amendment, the aggregate amount of the revolving credit facility commitments was reduced to $264.0 million (from $265.0 million) and the maturity date of the revolving facility under the Credit Agreement was extended from March 15, 2019, to March 15, 2023. The Company capitalized approximately $0.2 million of direct costs incurred in connection with the Amendment, which will be amortized over the remaining life of the revolving credit facility. The interest rate under the revolving credit facility remained unchanged. No amounts were borrowed under the revolving credit facility at December 31, 2017, or March 31, 2017; however $8.9 million and $14.6 million of the revolving credit facility was considered utilized in connection with outstanding letters of credit at December 31, 2017 and March 31, 2017, respectively.

4.875% Senior Notes due 2025

On December 7, 2017, the Company issued $500.0 million aggregate principal amount of 4.875% senior notes due 2025 (the “Notes”). The Notes were issued by RBS Global, Inc. and Rexnord LLC (collectively, the “Issuers”) and guaranteed by the Company and its domestic subsidiaries (subject to certain exceptions). The Notes were issued pursuant to an Indenture, dated as of December 7, 2017 (the “Indenture”), by and among the Issuers, the subsidiary guarantors named therein (the “Subsidiary Guarantors”) and Wells Fargo Bank, National Association (the “Trustee”). The Notes are general senior unsecured obligations of the Issuers, the Subsidiary Guarantors and the Company. The Company separately entered into a Parent Guarantee with the Trustee whereby it guaranteed certain obligations of the Issuers under the Indenture. The Notes pay interest semi-annually on June 15 and December 15, accruing upon issuance, at a rate of 4.875% per year with the first payment due on June 15, 2018. The Notes were not and will not be registered under the Securities Act of 1933 or any state securities laws.

The Issuers may redeem some or all of the Notes at any time or from time to time prior to December 15, 2020 at certain “make-whole” redemption prices (as set forth in the Indenture) and after December 15, 2020 at specified redemption prices (as set forth in the Indenture). Additionally, the Issuers may redeem up to 40% of the aggregate principal amount of the Notes at any time or from time to time prior to December 15, 2020 with the net proceeds of specified equity offerings at specified redemption prices (as set forth in the Indenture). Upon a change of control (as defined in the Indenture), the Issuers will be required to make an offer to purchase the Notes at a price equal to 101% of the principal amount of the Notes on the date of purchase plus accrued interest.

The Indenture contains customary covenants, such as restrictions on the Issuers and its restricted subsidiaries (but not on Rexnord Corporation) incurring or guaranteeing additional indebtedness or issuing certain preferred shares, paying dividends and making other restricted payments and creating or incurring certain liens. The Notes and Indenture do not contain any financial covenants. The Notes and Indenture contain customary events of default, including the failure to pay principal or interest when due, breach of covenants, cross-acceleration to other debt of the Issuers or restricted subsidiaries in excess of $50 million and bankruptcy events, all subject to terms, including notice and cure periods, as set forth in the Indenture.

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Accounts Receivable Securitization Program

The Company maintains an accounts receivable securitization facility (the “Securitization”) with Wells Fargo Bank, N.A. Pursuant to the Securitization, Rexnord Funding (a wholly owned bankruptcy-remote special purpose subsidiary) has granted the lender under the Securitization a security interest in all of its current and future receivables and related assets in exchange for a credit facility permitting borrowings of up to a maximum aggregate amount of $100.0 million outstanding from time to time. Such borrowings will be used by Rexnord Funding to finance purchases of accounts receivable. The Securitization constitutes a “Permitted Receivables Financing” under Article 1 and Article 6 of the Credit Agreement. Any borrowings under the Securitization are accounted for as secured borrowings on the Company's condensed consolidated balance sheets.

As of both December 31, 2017 and March 31, 2017, the Company's available borrowing capacity under the Securitization was $100.0 million, based on the then-current accounts receivables. No amounts were borrowed under the Securitization at December 31, 2017 or March 31, 2017; however, $7.0 million and $4.6 million was considered utilized in connection with outstanding letters of credit at December 31, 2017 and March 31, 2017, respectively. As of December 31, 2017, the Company was in compliance with all applicable covenants and performance ratios contained in the Securitization.

See Note 11 to the audited consolidated financial statements of the Company's fiscal 2017 Annual Report on Form 10-K for further information regarding long-term debt.

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12. Derivative Financial Instruments

The Company is exposed to certain financial risks relating to fluctuations in foreign currency exchange rates and interest rates. The Company currently selectively uses foreign currency forward exchange contracts to manage its foreign currency risk and interest rate swaps and interest rate caps to manage its interest rate risk. All hedging transactions are authorized and executed pursuant to defined policies and procedures that prohibit the use of financial instruments for speculative purposes.

Foreign Exchange Contracts

The Company periodically enters into foreign currency forward contracts to mitigate the foreign currency volatility relative to certain intercompany and external cash flows expected to occur. These foreign currency forward contracts were not accounted for as cash flow hedges in accordance with ASC 815, Derivatives and Hedging (“ASC 815”), and as such were marked to market through earnings. The amounts recorded on the condensed consolidated balance sheets and recognized within the condensed consolidated statements of operations related to the Company's foreign currency forward contracts are set forth within the tables below.

Interest Rate Derivatives

The Company utilizes three interest rate swaps to hedge the variability in future cash flows associated with the Company's variable-rate term loans. The interest rate swaps, which originally became effective in fiscal 2016, convert $650.0 million of the Company’s variable-rate term loans to a weighted average fixed interest rate of 2.55% plus the applicable margin and will mature on September 27, 2018. In addition, the Company utilizes two interest rate caps to further mitigate the Company's exposure to increasing interest rates on its variable-rate interest loans. Those interest rate caps were effective beginning in fiscal 2015, with a maturity of October 24, 2018, and they cap the interest on $750.0 million of the Company's variable-rate interest loans at 3%, plus the applicable margin. In executing the interest rate caps, the Company paid a premium of $5.8 million. At inception, the interest rate swaps and interest rate caps were designated as cash flow hedges in accordance with ASC 815.

In connection with the Amendment to the Credit Agreement described in Note 11, the critical terms of the interest rate derivatives no longer matched the outstanding debt and no longer qualify as effective hedges. Upon discontinuation of hedge accounting, the unrealized losses associated with the interest rate derivatives remaining in accumulated other comprehensive loss is reclassified into interest expense on a straight-line basis over the remaining term of the interest rate derivatives. The fair values of the Company's interest rate derivatives are recorded on the condensed consolidated balance sheets; however, changes in fair values subsequent to the Amendment are recognized within the condensed consolidated statements of operations. See the amounts recorded on the condensed consolidated balance sheets related to the Company's interest rate derivatives within the tables below.

The Company's derivatives are measured at fair value in accordance with ASC 820, Fair Value Measurements and Disclosure (“ASC 820”). See Note 13 for more information as it relates to the fair value measurement of the Company's derivative financial instruments. The following tables indicate the location and the fair value of the Company's non-qualifying, non-designated derivative instruments within the condensed consolidated balance sheets (in millions):

	December 31, 2017		March 31, 2017		Balance Sheet Classification
	Asset Derivatives
Interest rate caps	$	—	$	0.0	Other assets
	Liability Derivatives
Interest rate swaps	$	3.6	$	—	Other current liabilities
Interest rate swaps	$	—	$	10.3	Other liabilities
Foreign currency forward contracts	$	0.0	$	0.1	Other current liabilities

The following table segregates the location and the amount of gains or losses associated with the changes in the fair value of the Company's derivative instruments, net of tax, within the condensed consolidated balance sheets (for instruments no longer qualifying for hedge accounting under ASC 815) and recognized within the condensed consolidated statements of operations (for non-qualifying, non-designated derivative instruments):

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	Amount of loss recognized in accumulated other comprehensive loss
Derivative instruments no longer qualifying for hedge accounting under ASC 815 (in millions)
	December 31, 2017		March 31, 2017
Interest rate swaps	$	3.3	$	6.4
Interest rate caps	$	1.8	$	3.1

		Amount recognized as (income) expense
Non-qualifying, non-designated derivative instruments (in millions)	Condensed Consolidated Statements of Operations Classification	Three Months Ended					Nine Months Ended
		December 31, 2017			December 31, 2016		December 31, 2017			December 31, 2016
Foreign currency forward contracts	Other expense, net	$	(0.5	)	$	—	$	—		$	0.5
Interest rate swaps	Interest expense, net	$	(2.2	)	$	—	$	(2.2	)	$	—

The Company expects to reclassify approximately $8.2 million of losses related to its interest rate derivatives recorded within accumulated other comprehensive loss into earnings as interest expense during the next twelve months.

13. Fair Value Measurements

ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. ASC 820 also specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed assumptions about the assumptions a market participant would use.

In accordance with ASC 820, fair value measurements are classified under the following hierarchy:

• Level 1- Quoted prices for identical instruments in active markets.

• Level 2- Quoted prices for similar instruments; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs or significant value-drivers are observable.

• Level 3- Model-derived valuations in which one or more inputs or value-drivers are both significant to the fair value measurement and unobservable.

If applicable, the Company uses quoted market prices in active markets to determine fair value, and therefore classifies such measurements within Level 1. In some cases where market prices are not available, the Company makes use of observable market-based inputs to calculate fair value, in which case the measurements are classified within Level 2. If quoted or observable market prices are not available, fair value is based upon internally developed models that use, where possible, current market-based parameters. These measurements are classified within Level 3 if they use significant unobservable inputs.

Fair Value of Derivative Instruments

The Company transacts in foreign currency forward contracts, interest rate swaps, and interest rate caps. The fair value of foreign currency forward contracts is based on a pricing model that utilizes the differential between the contract price and the market-based forward rate as applied to fixed future deliveries of currency at pre-designated settlement dates. The fair value of interest rate swaps and interest rate caps is based on pricing models. These models use discounted cash flows that utilize the appropriate market-based forward swap curves and interest rates.

The Company endeavors to utilize the best available information in measuring fair value. As required by ASC 820, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Foreign currency forward contracts and interest rate derivatives reside within Level 2 of the fair value hierarchy. There were no transfers of assets or liabilities between levels for the periods presented. The following table provides a summary of the Company's assets and liabilities recognized at fair value on a recurring basis as of December 31, 2017 and March 31, 2017 (in millions):

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	Fair Value as of December 31, 2017
	Level 1		Level 2		Level 3		Total
Liabilities:
Interest rate derivatives	$	—	$	3.6	$	—	$	3.6
Foreign currency forward contracts	—		0.0		—		—
Total liabilities at fair value	$	—	$	3.6	$	—	$	3.6

	Fair Value as of March 31, 2017
	Level 1		Level 2		Level 3		Total
Assets:
Interest rate caps	$	—	$	0.0	$	—	$	—
Total assets at fair value	$	—	$	—	$	—	$	—
Liabilities:
Interest rate swaps	$	—	$	10.3	$	—	$	10.3
Foreign currency forward contracts	—		0.1		—		0.1
Total liabilities at fair value	$	—	$	10.4	$	—	$	10.4

Fair Value of Non-Derivative Financial Instruments

The carrying amounts of cash, receivables, payables and accrued liabilities approximated fair value at December 31, 2017 and March 31, 2017 due to the short-term nature of those instruments. The fair value of long-term debt as of December 31, 2017 and March 31, 2017 was approximately $1,345.2 million and $1,644.6 million, respectively. The fair value is based on quoted market prices for the same issues.

Long-lived Assets and Intangible Assets

Long-lived assets (which includes property, plant and equipment and real estate) may be measured at fair value if such assets are held-for-sale or when there is a determination that the asset is impaired. Intangible assets (which include patents, tradenames, customer relationships, and non-compete agreements) also may be measured at fair value when there is a determination that the asset is impaired. The determination of fair value for these assets is based on the best information available that resides within Level 3 of the fair value hierarchy, including internal cash flow estimates discounted at an appropriate interest rate, quoted market prices when available, market prices for similar assets and independent appraisals, as appropriate. For real estate, cash flow estimates are based on current market estimates that reflect current and projected lease profiles and available industry information about expected trends in rental, occupancy and capitalization rates.

In connection with the ongoing supply chain optimization and footprint repositioning initiatives, the Company has taken several actions to consolidate existing manufacturing facilities and rationalize its product offerings. These actions require the Company to assess whether the carrying amount of impacted long-lived assets will be recoverable as well as whether the remaining useful lives require adjustment. During fiscal 2017 and 2018, the Company recognized both impairment charges and accelerated depreciation of certain assets to place the assets at net realizable value.  Net realizable value of these assets was determined using independent appraisals, classified as Level 3 inputs within the fair value hierarchy.  As of December 31, 2017 and March 31, 2017, these assets were recorded at net realizable value on the condensed consolidated balance sheets within property, plant and equipment in the amount of $6.3 million and $7.0 million, respectively.

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14. Commitments and Contingencies

Warranties:

The Company offers warranties on the sales of certain products and records an accrual for estimated future claims. Such accruals are based upon historical experience and management's estimate of the level of future claims. The following table presents changes in the Company's product warranty liability (in millions):

	Nine Months Ended
	December 31, 2017			December 31, 2016
Balance at beginning of period	$	7.5		$	6.8
Acquired obligations	0.2			0.4
Charged to operations	3.2			2.9
Claims settled	(3.4		)	(2.9		)
Balance at end of period	$	7.5		$	7.2

Contingencies:

The Company's subsidiaries are involved in various unresolved legal actions, administrative proceedings and claims in the ordinary course of business involving, among other things, product liability, commercial, employment, workers' compensation, intellectual property claims and environmental matters. The Company establishes accruals in a manner that is consistent with accounting principles generally accepted in the United States for costs associated with such matters when liability is probable and those costs are capable of being reasonably estimated. Although it is not possible to predict with certainty the outcome of these unresolved legal actions or the range of possible loss or recovery, based upon current information, management believes the eventual outcome of these unresolved legal actions, either individually or in the aggregate, will not have a material adverse effect on the financial position, results of operations or cash flows of the Company.    

In connection with its sale of the Company, Invensys plc ("Invensys") provided the Company with indemnification against certain contingent liabilities, including certain pre-closing environmental liabilities. The Company believes that, pursuant to such indemnity obligations, Invensys is obligated to defend and indemnify the Company with respect to the matters described below relating to the Ellsworth Industrial Park Site and to various asbestos claims. The indemnity obligations relating to the matters described below are subject, together with indemnity obligations relating to other matters, to an overall dollar cap equal to the purchase price, which is an amount in excess of $900 million. The following paragraphs summarize the most significant actions and proceedings:

• In 2002, Rexnord Industries, LLC (“Rexnord Industries”) was named as a potentially responsible party (“PRP”), together with at least ten other companies, at the Ellsworth Industrial Park Site, Downers Grove, DuPage County, Illinois (the “Site”), by the United States Environmental Protection Agency (“USEPA”), and the Illinois Environmental Protection Agency (“IEPA”). Rexnord Industries' Downers Grove property is situated within the Ellsworth Industrial Complex. The USEPA and IEPA allege there have been one or more releases or threatened releases of chlorinated solvents and other hazardous substances, pollutants or contaminants, allegedly including but not limited to a release or threatened release on or from the Company's property, at the Site. The relief sought by the USEPA and IEPA includes further investigation and potential remediation of the Site and reimbursement of USEPA's past costs. Rexnord Industries' allocated share of past and future costs related to the Site, including for investigation and/or remediation, could be significant. All previously pending property damage and personal injury lawsuits against the Company related to the Site have been settled or dismissed. Pursuant to its indemnity obligation, Invensys continues to defend the Company in known matters related to the Site and has paid 100% of the costs to date.

• Multiple lawsuits (with approximately 300 claimants) are pending in state or federal court in numerous jurisdictions relating to alleged personal injuries due to the alleged presence of asbestos in certain brakes and clutches previously manufactured by the Company's Stearns division and/or its predecessor owners. Invensys and FMC, prior owners of the Stearns business, have paid 100% of the costs to date related to the Stearns lawsuits. Similarly, the Company's Prager subsidiary is a defendant in two multi-defendant lawsuits relating to alleged personal injuries due to the alleged presence of asbestos in a product allegedly manufactured by Prager. Additionally, there are numerous individuals who have filed asbestos related claims against Prager. These claims are currently on the Texas Multi-District Litigation inactive docket. The ultimate outcome of these asbestos matters cannot presently be determined. To date, the Company's insurance providers have paid 100% of the costs related to the Prager asbestos matters. The Company believes that the combination of its insurance coverage and the Invensys indemnity obligations will cover any future costs of these matters.

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In connection with the Company's acquisition of The Falk Corporation (“Falk”), Hamilton Sundstrand provided the Company with indemnification against certain products-related asbestos exposure liabilities. The Company believes that, pursuant to such indemnity obligations, Hamilton Sundstrand is obligated to defend and indemnify the Company with respect to the asbestos claims described below, and that, with respect to these claims, such indemnity obligations are not subject to any time or dollar limitations.

The following paragraph summarizes the most significant actions and proceedings for which Hamilton Sundstrand has accepted responsibility:

• Falk, through its successor entity, is a defendant in multiple lawsuits pending in state or federal court in numerous jurisdictions relating to alleged personal injuries due to the alleged presence of asbestos in certain clutches and drives previously manufactured by Falk. There are approximately 100 claimants in these suits. The ultimate outcome of these lawsuits cannot presently be determined. Hamilton Sundstrand is defending the Company in these lawsuits pursuant to its indemnity obligations and has paid 100% of the costs to date.

Certain Water Management subsidiaries are also subject to asbestos litigation. As of December 31, 2017, Zurn and numerous other unrelated companies were defendants in approximately 6,000 asbestos related lawsuits representing approximately 16,000 claims. Plaintiffs' claims allege personal injuries caused by exposure to asbestos used primarily in industrial boilers formerly manufactured by a segment of Zurn. Zurn did not manufacture asbestos or asbestos components. Instead, Zurn purchased them from suppliers. These claims are being handled pursuant to a defense strategy funded by insurers.

As of December 31, 2017, the Company estimates the potential liability for the asbestos-related claims described above as well as the claims expected to be filed in the next ten years to be approximately $37.0 million, of which Zurn expects its insurance carriers to pay approximately $28.0 million in the next ten years on such claims, with the balance of the estimated liability being paid in subsequent years. The $37.0 million was developed based on actuarial studies and represents the projected indemnity payout for current and future claims. There are inherent uncertainties involved in estimating the number of future asbestos claims, future settlement costs, and the effectiveness of defense strategies and settlement initiatives. As a result, actual liability could differ from the estimate described herein and could be substantial. The liability for the asbestos-related claims is recorded in Other liabilities within the condensed consolidated balance sheets.

Management estimates that its available insurance to cover this potential asbestos liability as of December 31, 2017, is approximately $241.0 million, and believes that all current claims are covered by insurance. However, principally as a result of the past insolvency of certain of the Company's insurance carriers, certain coverage gaps will exist if and after the Company's other carriers have paid the first $165.0 million of aggregate liabilities.

As of December 31, 2017, the Company had a recorded receivable from its insurance carriers of $37.0 million, which corresponds to the amount of this potential asbestos liability that is covered by available insurance and is currently determined to be probable of recovery. However, there is no assurance that $241.0 million of insurance coverage will ultimately be available or that this asbestos liability will not ultimately exceed $241.0 million. Factors that could cause a decrease in the amount of available coverage include: changes in law governing the policies, potential disputes with the carriers regarding the scope of coverage, and insolvencies of one or more of the Company's carriers. The receivable for probable asbestos-related recoveries is recorded in Other assets within the condensed consolidated balance sheets.

Certain Company subsidiaries were named as defendants in a number of individual and class action lawsuits in various United States courts claiming damages due to the alleged failure or anticipated failure of Zurn brass fittings on the PEX plumbing systems in homes and other structures. In fiscal 2013, the Company reached a court-approved agreement to settle the liability underlying this litigation.  The settlement is designed to resolve, on a national basis, the Company's overall exposure for both known and unknown claims related to the alleged failure or anticipated failure of such fittings, subject to the right of eligible class members to opt-out of the settlement and pursue their claims independently.  The settlement utilizes a seven year claims fund, which is capped at $20.0 million, and is funded in installments over the seven year period based on claim activity and minimum funding criteria.  The settlement also covers class action plaintiffs' attorneys' fees and expenses. Historically, the Company's insurance carrier had funded the Company's defense in the above referenced proceedings. The Company, however, reached a settlement agreement with its insurer, whereby the insurer paid the Company a lump sum in exchange for a release of future exposure related to this liability. The Company has recorded an accrual related to this brass fittings liability, which takes into account, in pertinent part, the insurance carrier contribution, as well as exposure from the claims fund, opt-outs and the waiver of future insurance coverage.

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Sale-Leaseback Transaction:

During the third quarter of fiscal 2018, the Company entered into a sale-leaseback arrangement for an owned facility in Downer's Grove, Illinois and received net proceeds from the transaction of $5.8 million. Due to the Company's continuing involvement with the construction of a new facility at the same location, the property did not qualify for sale accounting under the sale-leaseback accounting guidance during the construction period and as a result it has been accounted for as a financing transaction, with the $5.8 million of proceeds being classified in the condensed consolidated balance sheets in "Other current liabilities". The Company will depreciate the carrying value of the building over the expected remaining useful life. No gain or loss was recognized from the transaction.

As a result of the Company's anticipated involvement during the construction period of the new manufacturing facility the Company is considered, for accounting purposes only, the owner of the construction asset under build-to-suit lease accounting. Upon completion of construction, the Company will evaluate the de-recognition of the asset and liability under sale-leaseback accounting guidance.

15. Retirement Benefits

The components of net periodic benefit cost are as follows (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Pension Benefits:
Service cost	$	0.2		$	0.5		$	0.6		$	1.4
Interest cost	6.1			6.4			18.3			19.0
Expected return on plan assets	(6.6		)	(6.8		)	(19.8		)	(20.0		)
Amortization:
Prior service cost	—			—			—			0.1
Net periodic benefit (credit) cost	$	(0.3	)	$	0.1		$	(0.9	)	$	0.5
Other Postretirement Benefits:
Interest cost	$	0.2		$	0.3		$	0.3		$	0.9
Amortization:
Prior service credit	(0.5		)	(0.5		)	(1.5		)	(1.5		)
Net periodic benefit credit	$	(0.3	)	$	(0.2	)	$	(1.2	)	$	(0.6	)

During the first nine months of fiscal 2018 and 2017, the Company made contributions of $2.9 million and $4.6 million, respectively, to its U.S. qualified pension plan trusts.

In accordance with the Company's accounting policy for defined benefit pension and other postretirement benefit plans, actuarial gains and losses above the corridor are immediately recognized in the Company's operating results. The corridor is 10% of the higher of the pension benefit obligation or the fair value of the plan assets. This adjustment is typically recorded annually in the fourth quarter in connection with the Company's required year-end re-measurement of plan assets and benefit obligations, or upon any off-cycle re-measurement event.

As of December 31, 2017, the Company merged three of its U.S. qualified defined benefit pension plans into a single plan, thereby also merging all of the pension plans’ assets. The merger of the three plans was a non-substantive change with no changes to the benefit formulas, vesting provisions, or to the employees covered by the plans.  Accordingly, the Company deemed an off-cycle remeasurement of the plan assets and benefit obligations was not required. 

See Note 16 to the audited consolidated financial statements of the Company's fiscal 2017 Annual Report on Form 10-K for further information regarding retirement benefits.

16. Stock-Based Compensation

The Rexnord Corporation Performance Incentive Plan (the "Plan") is utilized to provide performance incentives to the Company's officers, employees, directors and certain others by permitting grants of equity awards (for common stock), as well as performance-based cash awards, to such persons to encourage them to maximize Rexnord's performance and create value for Rexnord's stockholders. ASC 718, Compensation-Stock Compensation (“ASC 718”), requires compensation costs related to share-

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based payment transactions to be recognized in the financial statements. Generally, compensation cost is measured based on the estimated grant-date fair value of the equity instruments issued. Compensation cost is recognized over the requisite service period, generally as the awards vest.

For the three and nine months endedDecember 31, 2017, the Company recognized $5.1 million and $15.9 million of stock-based compensation expense, respectively. For the three and nine months endedDecember 31, 2016, the Company recognized $3.8 million and $9.8 million of stock-based compensation expense, respectively. As of December 31, 2017, there was $29.4 million of total unrecognized compensation cost related to non-vested equity awards that is expected to be recognized over a weighted-average period of 1.8 years.

Stock Options

During the nine months endedDecember 31, 2017 and December 31, 2016, the Company granted stock options to executive officers and certain other employees, which vest over a weighted-average term of three years. The fair value of each option granted under the Plan during the nine months endedDecember 31, 2017 was estimated on the grant date using the Black-Scholes valuation model utilizing the following weighted-average assumptions:

	Nine Months Ended December 31, 2017
Expected option term (in years)	6.5
Expected volatility factor	31%
Weighted-average risk-free interest rate	1.99%
Expected dividend rate	0.0%

The Company estimates the expected term of stock options granted based on the midpoint between when the options vest and when they expire. The Company uses the simplified method to determine the expected term, as management does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term due to the limited period of time its common stock shares has been publicly traded. The Company’s expected volatility assumption is based on its historical volatility. The weighted-average risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date of grant. Management assumes expected dividends of zero. The weighted-average grant date fair value of options granted under the Plan during the nine months endedDecember 31, 2017 was $8.11.

A summary of stock option activity during the first nine months of fiscal 2018 and 2017 is as follows:

	Nine Months Ended
	December 31, 2017				December 31, 2016
	Shares		Weighted Avg. Exercise Price		Shares		Weighted Avg. Exercise Price
Number of common shares under option:
Outstanding at beginning of period	7,770,670		$	18.73	7,854,685		$	15.10
Granted	1,175,702		23.17		2,599,538		19.72
Exercised	(246,372	)	13.44		(1,937,487	)	5.00
Canceled/Forfeited	(162,663	)	22.57		(451,536	)	23.52
Outstanding at end of period (1)	8,537,337		$	19.42	8,065,200		$	18.53
Exercisable at end of period (2)	5,081,221		$	17.79	3,370,968		$	14.74

______________________

(1) The weighted average remaining contractual life of options outstanding at December 31, 2017 is 6.3 years.

(2) The weighted average remaining contractual life of options exercisable at December 31, 2017 is 5.0 years.

Restricted Stock Units

During the nine months endedDecember 31, 2017 and 2016, the Company granted restricted stock units ("RSUs") to its non-employee directors and certain employees. RSUs granted during the nine months endedDecember 31, 2017 and 2016 generally vest ratably over three years. The fair value of each award is determined based on the Company's closing stock price on the date of grant. A summary of RSU activity during the nine months endedDecember 31, 2017 and 2016 is as follows:

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	Nine Months Ended
	December 31, 2017				December 31, 2016
	Shares		Weighted Avg. Grant Date Fair Value		Shares		Weighted Avg. Grant Date Fair Value
Nonvested RSUs at beginning of period	322,142		$	20.59	125,307		$	24.67
Granted	248,199		23.16		276,943		19.51
Vested	(101,103	)	21.25		(42,144	)	24.63
Canceled/Forfeited	(30,729	)	22.48		(29,036	)	21.99
Nonvested RSUs at end of period	438,509		$	21.76	331,070		$	20.59

Performance Stock Units

The Company grants performance stock units (“PSUs”) to its executive officers and certain other employees. PSUs have a three-year performance period and are earned and vest, subject to continued employment, based in part on performance relative to metrics determined by the Compensation Committee. The number of PSUs earned, which can range between 0% and 200% of the target awards granted depending on the Company's actual performance during the three-year performance period, will be satisfied with Rexnord common stock. A summary of PSU activity during the nine months endedDecember 31, 2017 and 2016 is as follows:    

	Nine Months Ended
	December 31, 2017			December 31, 2016
	Shares	Weighted Avg. Grant Date Fair Value		Shares		Weighted Avg. Grant Date Fair Value
Nonvested PSUs at beginning of period	259,930	$	24.74	49,136		$	28.57
Granted	193,071	26.58		219,266		23.95
Vested	—	—		—		—
Canceled/Forfeited	—	—		(4,200	)	28.57
Nonvested PSUs at end of period	453,001	$	25.53	264,202		$	24.74

The fair value of the portion of PSUs with vesting based on free cash flow conversion is determined based on the Company's closing common stock price on the date of grant. The fair value of the portion of PSUs with vesting based on relative total shareholder return is determined utilizing the Monte Carlo simulation model and the weighted-average fair value of awards granted during the nine months endedDecember 31, 2017 was $31.25. Assumptions used to determine the fair value of each PSU were based on historical data and standard industry valuation practices and methodology. The following weighted-average assumptions were used for the PSUs granted during the nine months endedDecember 31, 2017:

	Nine Months Ended December 31, 2017
Expected volatility factor	31%
Weighted-average risk-free interest rate	1.45%
Expected dividend rate	0.0%

28

17. Business Segment Information

The Company's results of operations are reported in two business segments, consisting of the Process & Motion Control platform and the Water Management platform. The Process & Motion Control platform designs, manufactures, markets and services a comprehensive range of specified, highly-engineered mechanical components used within complex systems where customers' reliability requirements and costs of failure or downtime are high. The Process & Motion Control portfolio includes motion control products, shaft management products, aerospace components, and related value-added services. Products and services are marketed and sold globally under widely recognized brand names, including Rexnord, Rex, FlatTop, Falk, Link-Beltand Cambridge. Process & Motion Control products and services are sold into a diverse group of attractive end markets, including food and beverage, aerospace, mining, petrochemical, energy and power generation, cement and aggregates, forest and wood products, agriculture, and general industrial and automation applications. The Water Management platform designs, procures, manufactures, and markets products that provide and enhance water quality, safety, flow control and conservation. The Water Management product portfolio includes professional grade water control and safety, water distribution and drainage, finish plumbing, and site works products for primarily nonresidential buildings and flow control products for water and wastewater treatment infrastructure markets. Products are marketed and sold under widely recognized brand names, including Zurn, Wilkins, and VAG. The financial information of the Company's segments is regularly evaluated by the chief operating decision maker in determining resource allocation and assessing performance. Management evaluates the performance of each business segment based on its operating results. The same accounting policies are used throughout the organization (see Note 1).

Business Segment Information (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Net sales
Process & Motion Control	$	292.5		$	270.3		$	880.6		$	820.9
Water Management	199.8			181.5			610.2			593.7
Consolidated net sales	$	492.3		$	451.8		$	1,490.8		$	1,414.6
Income (loss) from operations
Process & Motion Control	$	48.5		$	28.6		$	132.9		$	91.3
Water Management	25.8			14.4			85.9			63.1
Corporate	(11.1		)	(10.2		)	(34.6		)	(30.5		)
Consolidated income from operations	$	63.2		$	32.8		$	184.2		$	123.9
Non-operating expense:
Interest expense, net	$	(18.7	)	$	(22.9	)	$	(58.9	)	$	(69.4	)
Loss on the extinguishment of debt	(11.9		)	(7.8		)	(11.9		)	(7.8		)
Other expense, net	(1.0		)	(0.7		)	(2.5		)	(3.3		)
Income before income taxes	31.6			1.4			110.9			43.4
Benefit for income taxes	(50.0		)	(1.8		)	(27.0		)	(3.3		)
Net income	81.6			3.2			137.9			46.7
Dividends on preferred stock	(5.8		)	(1.5		)	(17.4		)	(1.5		)
Net income attributable to Rexnord common stockholders	$	75.8		$	1.7		$	120.5		$	45.2
Depreciation and amortization
Process & Motion Control	$	13.0		$	17.0		$	40.4		$	51.8
Water Management	8.7			8.8			24.9			27.3
Consolidated	$	21.7		$	25.8		$	65.3		$	79.1
Capital expenditures
Process & Motion Control	$	7.6		$	12.0		$	20.8		$	32.9
Water Management	1.6			3.1			4.3			11.1
Consolidated	$	9.2		$	15.1		$	25.1		$	44.0

29

18. Guarantor Subsidiaries

The following schedules present condensed consolidating financial information of the Company as of December 31, 2017 and 2016 and for the three and nine month periods ended December 31, 2017 and 2016 for (a) Rexnord Corporation, the parent company (the "Parent") (b) RBS Global, Inc. and its wholly-owned subsidiary Rexnord LLC, which together are co-issuers (the “Issuers”) of the outstanding Notes; (c) on a combined basis, the domestic subsidiaries of the Company, all of which are wholly-owned by the Issuers (collectively, the “Guarantor Subsidiaries”) and guarantors of those Notes; and (d) on a combined basis, the foreign subsidiaries of the Company (collectively, the “Non-Guarantor Subsidiaries”). Separate financial statements of the Guarantor Subsidiaries are not presented because their guarantees of the senior notes and senior subordinated notes are full, unconditional and joint and several, and the Company believes separate financial statements and other disclosures regarding the Guarantor Subsidiaries are not material to investors.

30

Condensed Consolidating Balance Sheets

December 31, 2017

(in millions)

	Parent			Issuers		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	—		$	0.4	$	41.3		$	193.1	$	—		$	234.8
Receivables, net	—			—		176.7			136.4		—			313.1
Inventories, net	—			—		227.6			122.3		—			349.9
Other current assets	4.4			—		17.2			35.5		—			57.1
Total current assets	4.4			0.4		462.8			487.3		—			954.9
Property, plant and equipment, net	—			—		239.7			149.6		—			389.3
Intangible assets, net	—			—		450.1			117.8		—			567.9
Goodwill	—			—		1,022.8			331.0		—			1,353.8
Investment in:
Issuer subsidiaries	1,215.9			—		—			—		(1,215.9		)	—
Guarantor subsidiaries	—			3,098.4		—			—		(3,098.4		)	—
Non-guarantor subsidiaries	—			—		688.7			—		(688.7		)	—
Other assets	22.6			1.4		47.9			12.2		—			84.1
Total assets	$	1,242.9		$	3,100.2	$	2,912.0		$	1,097.9	$	(5,003.0	)	$	3,350.0
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt	$	—		$	—	$	0.2		$	—	$	—		$	0.2
Trade payables	—			0.7		120.1			78.8		—			199.6
Compensation and benefits	—			—		30.1			22.3		—			52.4
Current portion of pension and postretirement benefit obligations	—			—		2.5			1.9		—			4.4
Other current liabilities	—			5.8		74.8			46.1		—			126.7
Total current liabilities	—			6.5		227.7			149.1		—			383.3
Long-term debt	—			1,285.3		37.4			0.2		—			1,322.9
Note (receivable from) payable to affiliates, net	(11.5		)	588.3		(741.0		)	164.2		—			—
Pension and postretirement benefit obligations	—			—		118.5			52.4		—			170.9
Deferred income taxes	—			4.1		108.4			33.7		—			146.2
Other liabilities	0.3			0.1		62.6			9.6		—			72.6
Total liabilities	(11.2		)	1,884.3		(186.4		)	409.2		—			2,095.9
Total stockholders' equity	1,254.1			1,215.9		3,098.4			688.7		(5,003.0		)	1,254.1
Total liabilities and stockholders' equity	$	1,242.9		$	3,100.2	$	2,912.0		$	1,097.9	$	(5,003.0	)	$	3,350.0

31

Condensed Consolidating Balance Sheets

March 31, 2017

(in millions)

	Parent			Issuers		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	4.9		$	0.1	$	253.3		$	231.8	$	—		$	490.1
Receivables, net	—			—		191.3			131.6		—			322.9
Inventories, net	—			—		223.8			91.1		—			314.9
Other current assets	4.4			—		11.0			34.8		—			50.2
Total current assets	9.3			0.1		679.4			489.3		—			1,178.1
Property, plant and equipment, net	—			—		255.3			145.6		—			400.9
Intangible assets, net	—			—		441.9			116.7		—			558.6
Goodwill	—			—		996.8			321.4		—			1,318.2
Investment in:
Issuer subsidiaries	1,020.1			—		—			—		(1,020.1		)	—
Guarantor subsidiaries	—			2,835.2		—			—		(2,835.2		)	—
Non-guarantor subsidiaries	—			—		602.2			—		(602.2		)	—
Other assets	22.6			1.8		46.8			12.3		—			83.5
Total assets	$	1,052.0		$	2,837.1	$	3,022.4		$	1,085.3	$	(4,457.5	)	$	3,539.3
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt	$	—		$	16.1	$	0.4		$	—	$	—		$	16.5
Trade payables	—			—		120.3			77.5		—			197.8
Compensation and benefits	—			—		32.4			21.9		—			54.3
Current portion of pension and postretirement benefit obligations	—			—		2.4			1.9		—			4.3
Other current liabilities	—			5.7		76.4			45.3		—			127.4
Total current liabilities	—			21.8		231.9			146.6		—			400.3
Long-term debt	—			1,568.4		37.7			0.1		—			1,606.2
Note (receivable from) payable to affiliates, net	(18.7		)	215.5		(442.2		)	245.4		—			—
Pension and postretirement benefit obligations	—			—		124.6			49.8		—			174.4
Deferred income taxes	—			1.0		175.7			32.1		—			208.8
Other liabilities	0.1			10.3		59.5			9.1		—			79.0
Total liabilities	(18.6		)	1,817.0		187.2			483.1		—			2,468.7
Total stockholders' equity	1,070.6			1,020.1		2,835.2			602.2		(4,457.5		)	1,070.6
Total liabilities and stockholders' equity	$	1,052.0		$	2,837.1	$	3,022.4		$	1,085.3	$	(4,457.5	)	$	3,539.3

32

Condensed Consolidating Statements of Operations

For the Three Months Ended December 31, 2017

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	358.7		$	210.9		$	(77.3	)	$	492.3
Cost of sales	—		—			226.3			160.4			(77.3		)	309.4
Gross profit	—		—			132.4			50.5			—			182.9
Selling, general and administrative expenses	—		—			76.1			31.2			—			107.3
Restructuring and other similar charges	—		—			3.2			0.6			—			3.8
Amortization of intangible assets	—		—			7.0			1.6			—			8.6
Income from operations	—		—			46.1			17.1			—			63.2
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(18.7		)	0.1			(0.1		)	—			(18.7		)
To affiliates	0.7		6.7			(6.1		)	(1.3		)	—			—
Loss on extinguishment of debt	—		(11.9		)	—			—			—			(11.9		)
Other income (expense), net	—		(0.1		)	(2.5		)	1.6			—			(1.0		)
Income (loss) before income taxes from operations	0.7		(24.0		)	37.6			17.3			—			31.6
(Benefit) provision for income taxes	—		—			(55.4		)	5.4			—			(50.0		)
Income (loss) before equity in income of subsidiaries	0.7		(24.0		)	93.0			11.9			—			81.6
Equity in earnings of subsidiaries	80.9		104.9			11.9			—			(197.7		)	—
Net income	81.6		80.9			104.9			11.9			(197.7		)	81.6
Dividends on preferred stock	5.8		—			—			—			—			5.8
Net income attributable to Rexnord	$	75.8	$	80.9		$	104.9		$	11.9		$	(197.7	)	$	75.8
Comprehensive income	$	81.6	$	83.3		$	104.8		$	17.4		$	(197.7	)	$	89.4

33

Condensed Consolidating Statements of Operations

For the Nine Months Ended December 31, 2017

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	1,092.4		$	619.4		$	(221.0	)	$	1,490.8
Cost of sales	—		—			684.8			479.8			(221.0		)	943.6
Gross profit	—		—			407.6			139.6			—			547.2
Selling, general and administrative expenses	—		—			231.1			95.5			—			326.6
Restructuring and other similar charges	—		—			8.3			3.3			—			11.6
Amortization of intangible assets	—		—			20.0			4.8			—			24.8
Income from operations	—		—			148.2			36.0			—			184.2
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(59.3		)	0.4			—			—			(58.9		)
To affiliates	2.4		19.8			(18.2		)	(4.0		)	—			—
Loss on extinguishment of debt	—		(11.9		)	—			—			—			(11.9		)
Other expense, net	—		—			(4.7		)	2.2			—			(2.5		)
Income (loss) before income taxes from operations	2.4		(51.4		)	125.7			34.2			—			110.9
(Benefit) provision for income taxes	—		—			(41.6		)	14.6			—			(27.0		)
Income (loss) before equity in income of subsidiaries	2.4		(51.4		)	167.3			19.6			—			137.9
Equity in earnings of subsidiaries	135.5		186.9			19.6			—			(342.0		)	—
Net income	137.9		135.5			186.9			19.6			(342.0		)	137.9
Dividends on preferred stock	17.4		—			—			—			—			17.4
Net income attributable to Rexnord	$	120.5	$	135.5		$	186.9		$	19.6		$	(342.0	)	$	120.5
Comprehensive income	$	137.9	$	147.1		$	189.4		$	49.7		$	(342.0	)	$	182.1

34

Condensed Consolidating Statements of Operations

For the Three Months Ended December 31, 2016

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	331.4		$	176.4		$	(56.0	)	$	451.8
Cost of sales	—		—			217.9			136.9			(56.0		)	298.8
Gross profit	—		—			113.5			39.5			—			153.0
Selling, general and administrative expenses	—		—			70.5			29.4			—			99.9
Restructuring and other similar charges	—		—			10.9			0.8			—			11.7
Amortization of intangible assets	—		—			7.0			1.6			—			8.6
Income from operations	—		—			25.1			7.7			—			32.8
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(22.8		)	(0.1		)	—			—			(22.9		)
To affiliates	0.2		16.4			(13.7		)	(2.9		)	—			—
Loss on extinguishment of debt	—		(7.8		)	—			—			—			(7.8		)
Other expense, net	—		—			(0.3		)	(0.4		)	—			(0.7		)
Income (loss) before income taxes from operations	0.2		(14.2		)	11.0			4.4			—			1.4
(Benefit) provision for income taxes	—		—			(6.5		)	4.7			—			(1.8		)
Net income (loss) before equity in loss of subsidiaries	0.2		(14.2		)	17.5			(0.3		)	—			3.2
Equity in earnings (loss) of subsidiaries	3.0		17.2			(0.3		)	—			(19.9		)	—
Net income	3.2		3.0			17.2			(0.3		)	(19.9		)	3.2
Dividends on preferred stock	1.5		—			—			—			—			1.5
Net income attributable to Rexnord	$	1.7	$	3.0		$	17.2		$	(0.3	)	$	(19.9	)	$	1.7
Comprehensive income (loss)	$	3.2	$	0.3		$	5.5		$	(16.4	)	$	(19.9	)	$	(27.3	)

35

Condensed Consolidating Statements of Operations

For the Nine Months Ended December 31, 2016

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	1,043.6		$	545.5		$	(174.5	)	$	1,414.6
Cost of sales	—		—			682.5			414.2			(174.5		)	922.2
Gross profit	—		—			361.1			131.3			—			492.4
Selling, general and administrative expenses	—		—			224.0			89.1			—			313.1
Restructuring and other similar charges	—		—			18.5			3.2			—			21.7
Amortization of intangible assets	—		—			28.7			5.0			—			33.7
Income from operations	—		—			89.9			34.0			—			123.9
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(68.8		)	(0.5		)	(0.1		)	—			(69.4		)
To affiliates	0.2		58.4			(40.1		)	(18.5		)	—			—
Loss on extinguishment of debt	—		(7.8		)	—			—			—			(7.8		)
Other (expense) income, net	—		(0.5		)	(1.9		)	(0.9		)	—			(3.3		)
Income (loss) before income taxes from operations	0.2		(18.7		)	47.4			14.5			—			43.4
Provision (benefit) for income taxes	—		0.1			(14.2		)	10.8			—			(3.3		)
Income (loss) before equity in income of subsidiaries	0.2		(18.8		)	61.6			3.7			—			46.7
Equity in earnings of subsidiaries	46.5		65.3			3.7			—			(115.5		)	—
Net income	46.7		46.5			65.3			3.7			(115.5		)	46.7
Dividends on preferred stock	1.5		—			—			—			—			1.5
Net income attributable to Rexnord	$	45.2	$	46.5		$	65.3		$	3.7		$	(115.5	)	$	45.2
Comprehensive income (loss)	$	46.7	$	46.4		$	47.7		$	(7.3	)	$	(115.5	)	$	18.0

36

Condensed Consolidating Statements of Cash Flows

For the Nine Months Ended December 31, 2017

(in millions)

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Operating activities
Cash provided by (used for) operating activities	$	9.6		$	311.8		$	(154.8	)	$	(44.7	)	$	—	$	121.9
Investing activities
Expenditures for property, plant and equipment	—			—			(18.2		)	(6.9		)	—		(25.1		)
Acquisitions, net of cash	—			—			(50.0		)	—			—		(50.0		)
Proceeds from dispositions of property, plant and equipment	—			—			5.2			0.3			—		5.5
Cash used for investing activities	—			—			(63.0		)	(6.6		)	—		(69.6		)
Financing activities
Proceeds from borrowings of long-term debt	—			1,325.0			—			—			—		1,325.0
Repayments of long-term debt	—			(1,603.2		)	—			—			—		(1,603.2		)
Repayments of short-term debt	—			(24.3		)	—			—			—		(24.3		)
Payment of debt issuance costs	—			(9.0		)	—			—			—		(9.0		)
Proceeds from exercise of stock options	2.9			—			—			—			—		2.9
Proceeds from financing lease obligation	—			—			5.8			—			—		5.8
Payments of dividend on preferred stock	(17.4		)	—			—			—			—		(17.4		)
Cash (used for) provided by financing activities	(14.5		)	(311.5		)	5.8			—			—		(320.2		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			12.6			—		12.6
(Decrease) increase in cash and cash equivalents	(4.9		)	0.3			(212.0		)	(38.7		)	—		(255.3		)
Cash and cash equivalents at beginning of period	4.9			0.1			253.3			231.8			—		490.1
Cash and cash equivalents at end of period	$	—		$	0.4		$	41.3		$	193.1		$	—	$	234.8

37

Condensed Consolidating Statements of Cash Flows

For the Nine Months Ended December 31, 2016

(in millions)

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Operating activities
Net cash (used for) provided by operating activities	$	(404.9	)	$	304.7		$	161.2		$	61.1		$	—	$	122.1
Investing activities
Expenditures for property, plant and equipment	—			—			(35.1		)	(8.9		)	—		(44.0		)
Acquisitions, net of cash	—			—			(213.4		)	(0.3		)	—		(213.7		)
Proceeds from dispositions of property, plant and equipment	—			—			1.9			—			—		1.9
Cash used for investing activities	—			—			(246.6		)	(9.2		)	—		(255.8		)
Financing activities
Proceeds from borrowings of long-term debt	—			1,590.3			—			—			—		1,590.3
Repayments of long-term debt	—			(1,881.8		)	—			—			—		(1,881.8		)
Proceeds from borrowings of short-term debt	—			16.1			—			—			—		16.1
Repayments of short-term debt	—			(19.5		)	—			—			—		(19.5		)
Payment of debt issuance costs	—			(10.6		)	—			—			—		(10.6		)
Proceeds from issuance of preferred stock, net of direct offering costs	390.2			—			—			—			—		390.2
Proceeds from exercise of stock options	9.6			—			—			—			—		9.6
Deferred acquisition payment	—			—			—			(5.7		)	—		(5.7		)
Cash provided by (used for) financing activities	399.8			(305.5		)	—			(5.7		)	—		88.6
Effect of exchange rate changes on cash and cash equivalents	—			—			—			(10.2		)	—		(10.2		)
(Decrease) increase in cash and cash equivalents	(5.1		)	(0.8		)	(85.4		)	36.0			—		(55.3		)
Cash and cash equivalents at beginning of period	6.1			2.0			290.1			186.4			—		484.6
Cash and cash equivalents at end of period	$	1.0		$	1.2		$	204.7		$	222.4		$	—	$	429.3

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

Rexnord is a growth-oriented, multi-platform industrial company with what we believe are leading market shares and highly-trusted brands that serve a diverse array of global end markets. Our heritage of innovation and specification have allowed us to provide highly-engineered, mission-critical solutions to customers for decades and affords us the privilege of having long-term, valued relationships with market leaders. We operate our Company in a disciplined way and the Rexnord Business System (“RBS”) is our operating philosophy. Grounded in the spirit of continuous improvement, RBS creates a scalable, process-based framework that focuses on driving superior customer satisfaction and financial results by targeting world-class operating performance throughout all aspects of our business.

RBS initiatives employ a framework and various processes across multiple operations and geographies, and are intended to drive customer satisfaction, performance and operating results. Savings from our RBS initiatives reflect benefits from a wide variety of ongoing efficiency, productivity and process improvements. Unless individually significant, it is not practicable to disclose each RBS activity or change that generated savings.

The following information should be read in conjunction with the audited consolidated financial statements and notes thereto, along with Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) in our Annual Report on Form 10-K for the fiscal year ended March 31, 2017.

Fiscal Year

Our fiscal year ends on March 31. Throughout this MD&A, we refer to the quarter ended December 31, 2017 as the “third quarter of fiscal 2018” or the “third quarter ended December 31, 2017.” Similarly, we refer to the quarter ended December 31, 2016 as the “third quarter of fiscal 2017” or the “third quarter ended December 31, 2016.”

Critical Accounting Policies and Estimates

The condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"), which require us to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of the financial statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. Refer to Item 7, MD&A of our Annual Report on Form 10-K for the fiscal year ended March 31, 2017 for information with respect to our critical accounting policies, which we believe could have the most significant effect on our reported results and require subjective or complex judgments by management. Except for the items reported below, management believes that as of December 31, 2017 and during the period from April 1, 2017 through December 31, 2017, there has been no material change to this information, other than the items below.

Recent Accounting Pronouncements

See Item 1, Note 1 Basis of Presentation and Significant Accounting Policies regarding recent accounting pronouncements.

Acquisitions

On June 1, 2016, we acquired Cambridge International Holdings Corp. ("Cambridge") for a cash purchase price of$213.4 million. Cambridge, with operations in Cambridge, Maryland and Matamoros, Mexico, is one of the world's largest suppliers of metal conveying and engineered woven metal solutions, primarily used in food processing end markets, as well as in architectural, packaging and filtration applications. The acquisition of Cambridge expanded our presence in consumer-driven end markets in the Process & Motion Control platform. Our results of operations include the acquired operations subsequent to June 1, 2016.

On October 4, 2017, we acquired World Dryer Corporation (“World Dryer”) for a preliminary cash purchase price of approximately $50.0 million, excluding transaction costs and net of cash acquired. World Dryer is a leading global manufacturer of commercial electric hand dryers. This acquisition broadened the product portfolio of the Company's existing Water Management platform and is expected to bring even greater value to commercial building owners in the form of lower operating costs. Our results of operations include the acquired operations as part of our Water Management platform subsequent to October 4, 2017.

During the third quarter of fiscal 2018, we entered into a definitive agreement to acquire Centa Power Transmission (Centa Antriebe Kirschey GmbH) ("Centa"), for an estimated purchase price of approximately €118 million. Centa, headquartered in Haan, Germany, is a leading manufacturer of premium flexible couplings and drive shafts for industrial, marine, rail and power generation applications. The acquisition of Centa will add complementary product lines to our existing Process & Motion Control platform. The acquisition of Centa is subject to customary closing conditions; subject to those conditions, the transaction is expected to close during the fourth quarter of fiscal 2018.

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Restructuring

During fiscal 2018, we continued to execute various restructuring initiatives focused on driving efficiencies, reducing operating costs by modifying our footprint to reflect changes in the markets we serve, the impact of acquisitions on our overall manufacturing capacity, and refining our overall product portfolio. We expect these initiatives to continue, which may result in further workforce reductions, lease termination costs and other facility rationalization costs, including the impairment or accelerated depreciation of assets. At this time, our full repositioning plan is preliminary and related expenses are not yet estimable.

For the three and nine months endedDecember 31, 2017, restructuring and other similar charges totaled $3.8 million and $11.6 million, respectively. For the three and nine months endedDecember 31, 2016, restructuring and other similar charges totaled $11.7 million and $21.7 million, respectively. Refer to Note 3, Restructuring and Other Similar Charges for further information.

Product Line Divestiture

During fiscal 2016, we decided to exit the non-strategic Rodney Hunt Fontaine (“RHF”) flow control gate product line. We completed the exit of the RHF product line in fiscal 2017. For purposes of comparison in the following discussion of results of operations, the RHF net sales for the three and nine months endedDecember 31, 2016 was $2.4 million and $14.4 million, respectively. Loss from operations for the three and nine months endedDecember 31, 2016 was$6.1 million and $13.2 million, respectively. The RHF product line exit did not impact results for the three and nine months endedDecember 31, 2017.

Results of Operations

Third Quarter EndedDecember 31, 2017 compared with the Third Quarter EndedDecember 31, 2016:

Net sales

(Dollars in Millions)

	Quarter Ended
	December 31, 2017		December 31, 2016		Change		% Change
Process & Motion Control	$	292.5	$	270.3	$	22.2	8.2	%
Water Management	199.8		181.5		18.3		10.1	%
Consolidated	$	492.3	$	451.8	$	40.5	9.0	%

Process & Motion Control

Process & Motion Control net sales increased 8% year over year to $292.5 million in the third quarter of fiscal 2018 as core sales increased 6% year over year and foreign currency translation added 2%. The increase in core sales is the result of favorable demand trends across the majority of our served end markets.

Water Management

Water Management net sales were $199.8 million in the third quarter of fiscal 2018, an increase of 10% year over year. Core sales increased 7% year over year, excluding a 1% adverse impact associated with last year’s exit of the RHF product line, a 2% favorable impact from foreign currency translation, and a 2% increase from the World Dryer acquisition. The year-over-year increase in core sales reflects favorable demand trends in our nonresidential construction and water and wastewater infrastructure markets.

Income from operations

(Dollars in Millions)

	Quarter Ended
	December 31, 2017			December 31, 2016			Change			% Change
Process & Motion Control	$	48.5		$	28.6		$	19.9		69.6	%
% of net sales	16.6		%	10.6		%	6.0		%
Water Management	25.8			14.4			11.4			79.2	%
% of net sales	12.9		%	7.9		%	5.0		%
Corporate	(11.1		)	(10.2		)	(0.9		)	(8.8	)%
Consolidated	$	63.2		$	32.8		$	30.4		92.7	%
% of net sales	12.8		%	7.3		%	5.5		%

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Process & Motion Control

Process & Motion Control income from operations for the third quarter of fiscal 2018 was $48.5 million, or 16.6% of net sales. Income from operations as a percentage of net sales increased by 600 basis points year over year, primarily due to the core sales increase, RBS-led productivity gains and benefits from footprint repositioning actions and lower restructuring related expenses year over year, partially offset by higher incentive compensation accruals and incremental investments in our innovation and market expansion.

Water Management

Water Management income from operations was $25.8 million for the third quarter of fiscal 2018, or 12.9% of net sales. Income from operations as a percentage of net sales increased by 500 basis points year over year, as benefits from core sales volume growth, ongoing cost reduction and productivity initiatives and lower restructuring expense year over year more than offset incremental investments in our innovation and market expansion initiatives.

Corporate

Corporate expenses were $11.1 million in the third quarter of fiscal 2018 and $10.2 million in the third quarter of fiscal 2017. The increase in corporate expenses is primarily associated with higher year-over-year compensation-related costs (primarily stock-based compensation) relative to the third quarter of fiscal 2017.

Interest expense, net

Interest expense, net was $18.7 million in the third quarter of fiscal 2018 compared to $22.9 million in the third quarter of fiscal 2017. The decrease in interest expense is a result of the impact of lower outstanding borrowings in the third quarter of fiscal 2018 following a $195.0 million prepayment made on our term loan in the third quarter of fiscal 2017, as well as the impact of the reduction in overall term loan outstanding that occurred in the third quarter fiscal 2018. See Item 1, Note 11 Long-Term Debt for more information.

Other expense, net

Other expense, net for the third quarter of fiscal 2018 consisted of foreign currency transaction losses of $0.5 million and other miscellaneous expense of $0.5 million. Other expense, net for the third quarter of fiscal 2017 consisted of foreign currency transaction losses of $0.2 million and other miscellaneous expenses of $0.5 million.

Benefit for income taxes

The income tax benefit was $50.0 million in the third quarter of fiscal 2018 compared to an income tax benefit of $1.8 million in the third quarter of fiscal 2017. The effective income tax rate for the third quarter of fiscal 2018 was (158.2)% versus (128.6)% in the third quarter of fiscal 2017. The income tax benefit recorded on income before income taxes for the third quarter of fiscal 2018 was primarily due to the recognition of net income tax benefits associated with the enactment of U.S. Tax Cuts and Jobs Act ("U.S. Tax Reform") (see Item 1, Note 4 Income Taxes for additional information and explanation), the recognition of net tax benefits associated with the reduction in the tax liability originally recorded on the expatriation of certain foreign branch assets, and the net tax benefits associated with U.S. research and development credits and the Domestic Production Activities Deduction ("DPAD"). The income tax benefit recorded on income before income taxes for the third quarter of fiscal 2017 was primarily due to excess tax benefits associated with share-based payments, the recognition of net tax benefits associated with U.S. research and development credits and the DPAD, partially offset with the recognition of income tax expense relating to various foreign income tax audits.

On a quarterly basis, we review and analyze our valuation allowances associated with deferred tax assets relating to certain foreign and state net operating loss carryforwards as well as foreign tax credit carryforwards. In conjunction with this analysis, we weigh both positive and negative evidence for purposes of determining the proper balances of such valuation allowances. Future changes to the balances of these valuation allowances, as a result of our continued review and analysis, could result in a material impact to the financial statements for such period of change.

Net income attributable to Rexnord common stockholders

Net income attributable to Rexnord common stockholders for the third quarter of fiscal 2018 was $75.8 million, compared to net income of $1.7 million in the third quarter of fiscal 2017, as a result of the factors described above. Diluted net income per share attributable to Rexnord common stockholders was $0.67 in the third quarter of fiscal 2018, as compared to $0.02 in the third quarter of fiscal 2017. Net income available to Rexnord common stockholders in the third quarter of fiscal 2018 reflects the effect of $5.8 million of dividends on shares of cumulative preferred stock compared to $1.5 million of dividends on shares of cumulative preferred stock in the third quarter of fiscal 2017.

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Nine Months EndedDecember 31, 2017 Compared with the Nine Months EndedDecember 31, 2016:

Net sales

(Dollars in Millions)

	Nine Months Ended
	December 31, 2017		December 31, 2016		Change		% Change
Process & Motion Control	$	880.6	$	820.9	$	59.7	7.3	%
Water Management	610.2		593.7		16.5		2.8	%
Consolidated	$	1,490.8	$	1,414.6	$	76.2	5.4	%

Process & Motion Control

Process & Motion Control net sales were $880.6 million in the first nine months of fiscal 2018, up 7% year over year. Excluding a 1% increase from the acquisition of Cambridge and a 1% favorable impact from foreign currency translation, core net sales increased 5% year over year. The increase in core sales is the result of favorable demand trends across the majority of our served end markets.

Water Management

Water Management net sales were $610.2 million in the first nine months of fiscal 2018 compared to $593.7 million in the first nine months of fiscal 2017. Core net sales, which excludes a 3% adverse impact associated with the exit of the RHF product line, a 1% favorable impact from foreign currency translation, and a 1% benefit from the acquisition of World Dryer, increased 4% during the first nine months of fiscal 2018. The year-over-year increase in core sales reflects favorable demand trends in our nonresidential construction and water and wastewater infrastructure markets.

Income (loss) from operations

(Dollars in Millions)

	Nine Months Ended
	December 31, 2017			December 31, 2016			Change			% Change
Process & Motion Control	$	132.9		$	91.3		$	41.6		45.6	%
% of net sales	15.1		%	11.1		%	4.0		%
Water Management	85.9			63.1			22.8			36.1	%
% of net sales	14.1		%	10.6		%	3.5		%
Corporate	(34.6		)	(30.5		)	(4.1		)	(13.4	)%
Consolidated	$	184.2		$	123.9		$	60.3		48.7	%
% of net sales	12.4		%	8.8		%	3.6		%

Process & Motion Control

Process & Motion Control income from operations for the first nine months of fiscal 2018 was $132.9 million, or 15.1% of net sales. Income from operations as a percentage of net sales increased by 400 basis points year over year in the first nine months of fiscal 2018 primarily due to the core sales increase, RBS-led productivity gains and benefits from footprint repositioning actions, lower year-over-year restructuring related expenses and a reduction of amortization expense, partially offset by higher incentive compensation accruals and incremental investments in our innovation and market expansion.

Water Management

Water Management income from operations was $85.9 million for the first nine months of fiscal 2018, or 14.1% of net sales. Income from operations as a percentage of net sales increased 350 basis points year over year, as benefits from core sales volume growth, ongoing cost reduction and productivity initiatives, and lower restructuring expense year-over-year, more than offset incremental investments in our innovation and market expansion initiatives.

Corporate

Corporate expenses were $34.6 million in the first nine months of fiscal 2018 and $30.5 million in the first nine months of fiscal 2017. The increase in corporate expenses is primarily associated with higher year-over-year compensation-related costs (primarily stock-based compensation) relative to the first nine months of fiscal 2017.

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Interest expense, net

Interest expense, net was $58.9 million in the first nine months of fiscal 2018 compared to $69.4 million in the first nine months of fiscal 2016. The year-over-year decrease in interest expense is primarily a result of lower outstanding borrowings in the first nine months of fiscal 2018 following the $95.0 million voluntary prepayment made on our term loan during the first quarter of fiscal 2017, the $195.0 million prepayment made on our term loan in connection with the term loan refinancing completed in the third quarter of fiscal 2017, and the $302 million of payments made on our term loan during the first nine months of fiscal 2018. See Item 1, Note 11 Long-Term Debt for more information.

Other expense, net

Other expense, net for the first nine months of fiscal 2018, consisted of foreign currency transaction losses of $2.1 million and other miscellaneous expense of $0.4 million. Other expense, net for the first nine months of fiscal 2017, consisted of foreign currency transaction losses of $1.9 million, a $0.2 million loss on the sale of long-lived assets and other miscellaneous expense of $1.2 million.

Benefit for income taxes

The income tax benefit recorded in the first nine months of fiscal 2018 was $27.0 million compared to an income tax benefit of $3.3 million in the first nine months of fiscal 2017. The effective income tax rate for the first nine months of fiscal 2018 was (24.3)% versus (7.6)% in the first nine months of fiscal 2017. The income tax benefit recorded on income before income taxes for the first nine months of fiscal 2018 was primarily due to the recognition of net income tax benefits associated with the enactment of U.S. Tax Reform (see Item 1, Note 4 Income Taxes for additional information and explanation), the recognition of net tax benefits associated with the reduction in the tax liability originally recorded on the expatriation of certain foreign branch assets, and the net tax benefits associated with U.S. research and development credits and the DPAD. The income tax benefit recorded on income before income taxes for the first nine months of fiscal 2017 was primarily due to excess tax benefits associated with share-based payments, the recognition of net tax benefits associated with U.S. research and development credits, the recognition of a worthless stock and bad debt deduction for U.S. income tax purposes relating to an insolvent foreign subsidiary and the recognition of excess U.S. foreign tax credits, partially offset with the recognition of income tax expense relating to various foreign income tax audits.

Net income attributable to Rexnord common stockholders

Net income attributable to Rexnord common stockholders for the first nine months of fiscal 2018 was $120.5 million, compared to $45.2 million for the first nine months of fiscal 2017, as a result of the factors described above. Diluted income per share attributable to Rexnord common stockholders was $1.13 and $0.43 in the first nine months of fiscal 2018 and fiscal 2017, respectively. Net income attributable to Rexnord common stockholders in the first nine months of fiscal 2018 reflects the effect of $17.4 million of dividends on shares of cumulative preferred stock compared to $1.5 million of dividends on shares of cumulative preferred stock in the first nine months of fiscal 2017.

Non-GAAP Financial Measures

Non-GAAP financial measures are intended to supplement and not replace financial measures prepared in accordance with GAAP.

Core sales

Core sales excludes the impact of acquisitions (such as the Cambridge and World Dryer acquisitions), divestitures (such as the RHF product line exit) and foreign currency translation. Management believes that core sales facilitates easier and more meaningful comparisons of our net sales performance with prior and future periods and to our peers. We exclude the effect of acquisitions and divestitures because the nature, size and number of acquisitions and divestitures can vary dramatically from period to period and between us and our peers, and can also obscure underlying business trends and make comparisons of long-term performance difficult. We exclude the effect of foreign currency translation from this measure because the volatility of currency translation is not under management's control.

EBITDA

EBITDA represents earnings before interest, taxes, depreciation and amortization. EBITDA is presented because it is an important supplemental measure of performance and it is frequently used by analysts, investors and other interested parties in the evaluation of companies in our industry. EBITDA is also presented and compared by analysts and investors in evaluating our ability to meet debt service obligations. Other companies in our industry may calculate EBITDA differently. EBITDA is not a measurement of financial performance under U.S. GAAP and should not be considered as an alternative to cash flow from operating activities or as a measure of liquidity or an alternative to net income as indicators of operating performance or any other measures of performance derived in accordance with U.S. GAAP. Because EBITDA is calculated before recurring cash charges, including

43

interest expense and taxes, and is not adjusted for capital expenditures or other recurring cash requirements of the business, it should not be considered as a measure of discretionary cash available to invest in the growth of the business.

Adjusted EBITDA

Adjusted EBITDA (as described below in “Covenant Compliance”) is an important measure because, under our credit agreement, our ability to incur certain types of acquisition debt and certain types of subordinated debt, make certain types of acquisitions or asset exchanges, operate our business and make dividends or other distributions, all of which will impact our financial performance, is impacted by our Adjusted EBITDA, as our lenders measure our performance with a net first lien leverage ratio by comparing our senior secured bank indebtedness to our Adjusted EBITDA (see “Covenant Compliance” for additional discussion of this ratio, including a reconciliation to our net income). We reported net income available to Rexnord common stockholders in the nine months endedDecember 31, 2017 of $120.5 million and Adjusted EBITDA for the same period of $279.0 million. See “Covenant Compliance” for a reconciliation of Adjusted EBITDA to GAAP net income.

Covenant Compliance

Our credit agreement, which governs our senior secured credit facilities, contains, among other provisions, restrictive covenants regarding indebtedness, payments and distributions, mergers and acquisitions, asset sales, affiliate transactions, capital expenditures and the maintenance of certain financial ratios. Payment of borrowings under the credit agreement may be accelerated if there is an event of default. Events of default include the failure to pay principal and interest when due, a material breach of a representation or warranty, certain non-payments or defaults under other indebtedness, covenant defaults, events of bankruptcy and a change of control. With respect to our revolving facility, covenants require us to remain at or below a maximum total net leverage ratio of 6.75 to 1.0 as of the end of each fiscal quarter (it was 3.0 to 1.0 at December 31, 2017). Certain covenants contained in the credit agreement restrict our ability to take certain actions, such as incurring additional debt or making acquisitions, including if we are unable to meet the total net leverage ratio. Failure to comply with these covenants could limit our long-term growth prospects by hindering our ability to borrow under the revolver, to obtain future debt and/or to make acquisitions.

“Adjusted EBITDA” is the term we use to describe EBITDA as defined and adjusted in our credit agreement, which is net income, adjusted for the items summarized in the table below. Adjusted EBITDA is intended to show our unleveraged, pre-tax operating results and therefore reflects our financial performance based on operational factors, excluding non-operational, non-cash or non-recurring losses or gains. In view of our debt level, it is also provided to aid investors in understanding our compliance with our debt covenants. Adjusted EBITDA is not a presentation made in accordance with GAAP, and our use of the term Adjusted EBITDA varies from others in our industry. This measure should not be considered as an alternative to net income, income from operations or any other performance measures derived in accordance with GAAP. Adjusted EBITDA has important limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for analysis of our results as reported under GAAP. For example, Adjusted EBITDA does not reflect: (a) our capital expenditures, future requirements for capital expenditures or contractual commitments; (b) changes in, or cash requirements for, our working capital needs; (c) the significant interest expenses, or the cash requirements necessary to service interest or principal payments, on our debt; (d) tax payments that represent a reduction in cash available to us; (e) any cash requirements for the assets being depreciated and amortized that may have to be replaced in the future; or (f) the impact of earnings or charges resulting from matters that we and the lenders under our credit agreement may not consider indicative of our ongoing operations. In particular, our definition of Adjusted EBITDA allows us to add back certain non-cash, non-operating or non-recurring charges that are deducted in calculating net income, even though these are expenses that may recur, vary greatly and are difficult to predict and can represent the effect of long-term strategies as opposed to short-term results.

In addition, certain of these expenses can represent the reduction of cash that could be used for other corporate purposes. Further, although not included in the calculation of Adjusted EBITDA below, the measure may at times allow us to add estimated cost savings and operating synergies related to operational changes ranging from acquisitions or dispositions to restructurings, and/or exclude one-time transition expenditures that we anticipate we will need to incur to realize cost savings before such savings have occurred.

The calculation of Adjusted EBITDA under our credit agreement as of December 31, 2017 is presented in the table below. However, the results of such calculation could differ in the future based on the different types of adjustments that may be included in such respective calculations at the time.    

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Set forth below is a reconciliation of net income to Adjusted EBITDA for the periods indicated below.

(in millions)	Nine months ended December 31, 2016			Year ended March 31, 2017			Nine months ended December 31, 2017			Twelve months ended December 31, 2017
Net income attributable to Rexnord common stockholders	$	45.2		$	66.8		$	120.5		$	142.1
Interest expense, net	69.4			88.7			58.9			78.2
Dividends on preferred stock	1.5			7.3			17.4			23.2
Income tax (benefit) provision	(3.3		)	7.9			(27.0		)	(15.8		)
Depreciation and amortization	79.1			105.4			65.3			91.6
EBITDA	$	191.9		$	276.1		$	235.1		$	319.3
Adjustments to EBITDA:
Restructuring and other similar charges (1)	21.7			31.6			11.6			21.5
Stock-based compensation expense	9.8			13.4			15.9			19.5
LIFO (income) expense (2)	(0.2		)	(2.3		)	0.7			(1.4		)
Acquisition-related fair value adjustment	4.3			4.3			0.9			0.9
Loss on the extinguishment of debt	7.8			7.8			11.9			11.9
Actuarial gain on pension and postretirement benefit obligations	—			(2.6		)	—			(2.6		)
Loss on RHF product line exit (3) (excluding restructuring and related charges)	9.5			12.2			—			2.7
Other, net (4)	3.7			6.0			2.9			5.2
Subtotal of adjustments to EBITDA	$	56.6		$	70.4		$	43.9		$	57.7
Adjusted EBITDA	$	248.5		$	346.5		$	279.0		$	377.0
Pro forma adjustment for acquisitions (6)										$	3.6
Pro forma Adjusted EBITDA										$	380.6
Consolidated indebtedness (5)										$	1,126.8
Total net leverage ratio (6)										3.0

__________________________________

(1) Represents restructuring costs comprised of workforce reductions, impairment of related manufacturing facilities, equipment and intangible assets, lease termination costs, and other facility rationalization costs.  See Item 1, Note 3 Restructuring and Other Similar Charges for more information.

(2) Last-in first-out (LIFO) inventory adjustments are excluded in calculating Adjusted EBITDA as defined in our credit agreement.

(3) The operating loss (excluding restructuring and related charges included in their respective adjusting lines above) related to the RHF product line exit is not included in Adjusted EBITDA in accordance with our credit agreement. The exit of the RHF product line was completed in fiscal 2017.

(4) Other, net for the periods indicated, consists of:

(in millions)	Nine months ended December 31, 2016		Year ended March 31, 2017		Nine months ended December 31, 2017		Twelve months ended December 31, 2017
Other expense (income)
Loss (gain) on sale of long-lived assets	$	0.2	$	—	$	—	$	(0.2	)
Loss on foreign currency transactions	1.9		3.7		2.1		3.9
Other miscellaneous expenses	1.2		1.5		0.4		0.7
Total other expense	$	3.3	$	5.2	$	2.5	$	4.4
Other non-cash adjustments
Other non-cash charges	0.4		0.8		0.4		0.8
Total other, net	$	3.7	$	6.0	$	2.9	$	5.2

(5) Our credit agreement defines our consolidated indebtedness as the sum of all indebtedness (other than letters of credit or bank guarantees, to the extent undrawn) consisting of indebtedness for borrowed money and capitalized lease obligations, less unrestricted cash, which was $195.7 million (as defined by the credit agreement) at December 31, 2017.

(6) Our credit agreement defines the total net leverage ratio as the ratio of consolidated indebtedness (as described above) to Adjusted EBITDA for the trailing four fiscal quarters.

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Liquidity and Capital Resources

Our primary sources of liquidity are available cash and cash equivalents, cash flow from operations, borrowing availability of up to $264.0 million under our revolving credit facility, and availability of up to $100.0 million under our accounts receivable securitization program. We expect to utilize these sources of liquidity to fund the pending acquisition of Centa that is expected to close during our fourth quarter of fiscal 2018.

As of December 31, 2017, we had $234.8 million of cash and cash equivalents and $348.1 million of additional borrowing capacity ($255.1 million of available borrowings under our revolving credit facility and $93.0 million available under our accounts receivable securitization program). As of December 31, 2017, the available borrowings under our credit facility and accounts receivable securitization were reduced by $15.9 million due to outstanding letters of credit. As of March 31, 2017, we had $490.1 million of cash and cash equivalents and approximately $345.8 million of additional borrowing capacity ($250.4 million of available borrowings under our revolving credit facility and $95.4 million available under our accounts receivable securitization program). As of March 31, 2017, the available borrowings under our credit facility and accounts receivable securitization were reduced by $19.2 million due to outstanding letters of credit. Both our revolving credit facility and accounts receivable securitization program are available to fund our working capital requirements, acquisitions, capital expenditures and for other general corporate purposes.

Cash Flows

Net cash provided by operating activities was $121.9 million and $122.1 million in the first nine months of fiscal 2018 and 2017, respectively. Incremental profit generated from higher sales in the first nine months of fiscal 2018 was offset by higher year over year trade working capital.

Cash used for investing activities was $69.6 million in the first nine months of fiscal 2018 compared to $255.8 million in the first nine months of fiscal 2017. Investing activities in the first nine months of fiscal 2018 included $25.1 million of capital expenditures and $50.0 million associated with the acquisition of World Dryer, partially offset by the receipt of $5.5 million in cash for the disposal of long-lived assets. Investing activities during the first nine months of fiscal 2017 included $213.7 million of net cash associated with the acquisition of Cambridge and $44.0 million of capital expenditures, partially offset by the receipt of $1.9 million in cash for the disposal of long-lived assets.

Cash used for financing activities was $320.2 million in the first nine months of fiscal 2018 compared to cash provided by financing activities of $88.6 million in the first nine months of fiscal 2017. During the first nine months of fiscal 2018, we utilized a net $311.5 million of cash and net proceeds of our issuance of the Notes, net of financing related costs, in connection with the refinancing of the outstanding debt under our Credit Agreement (see Item 1 Note 11 Long-Term Debt for additional details). In addition we utilized $17.4 million for the payment of preferred stock dividends. These additional uses of cash were partially offset by the receipt of $5.8 million in connection with the sale-leaseback transaction (see Item 1 Note 14 for further information) and $2.9 million of cash proceeds associated with stock option exercises. During the first nine months of fiscal 2017, we received $390.2 million of proceeds from the closing of our preferred stock issuance on December 7, 2016, net of underwriting discounts, commissions and other direct costs of the offering (see Item 1 Note 6 Stockholders' Equity for additional details). The proceeds were partially offset by $305.5 million of net debt payments, primarily for voluntary prepayments on our Term Loan of $195.0 million in connection with the preferred stock issuance, as well as our first quarter voluntary prepayment on our then existing Term Loan of $95.0 million in the first quarter (see Item 1 Note 11 Long-Term Debt for additional details). The above two debt repayment transactions exclude $10.6 million of related debt issue costs. The first nine months of fiscal 2017 also includes $9.6 million of cash proceeds associated with stock option exercises. During the first nine months of fiscal 2017, we also settled the deferred acquisition payment associated with the fiscal 2015 acquisition of Tollok S.p.A. 

Indebtedness

As of December 31, 2017 we had $1,323.1 million of total indebtedness outstanding as follows (in millions):

	Total Debt at December 31, 2017		Short-term Debt and Current Maturities of Long-Term Debt		Long-term Portion
Term loan (1)	$	791.2	$	—	$	791.2
4.875% Senior notes due 2025 (2)	494.1		—		494.1
Other subsidiary debt (3)	37.8		0.2		37.6
Total	$	1,323.1	$	0.2	$	1,322.9

___________________________________________

(1) Includes an unamortized original issue discount and debt issuance costs of $8.8 million at December 31, 2017.

(2) Includes an unamortized original issue discount and debt issuance costs of $5.9 million at December 31, 2017.

(3) Includes unamortized debt issuance costs of $0.5 million at December 31, 2017.

46

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk during the normal course of business from changes in foreign currency exchange rates and interest rates. The exposure to these risks is managed through a combination of normal operating and financing activities and derivative financial instruments in the form of foreign currency forward contracts, interest rate swaps and interest rate caps to cover certain known foreign currency transactional risks, as well as identified risks due to interest rate fluctuations. There have been no material changes in market risk from the information provided in "Item 7A. Quantitative and Qualitative Disclosures About Market Risk" in our Form 10-K.

ITEM 4. CONTROLS AND PROCEDURES

We maintain a set of disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms.

We carried out an evaluation, under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Based on that evaluation as of December 31, 2017, the Chief Executive Officer and Chief Financial Officer concluded that, as of such date, the Company's disclosure controls and procedures are adequate and effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act and that such information is accumulated and communicated to the Company's management, including the Chief Executive Officer and Chief Financial Officer, in a manner allowing timely decisions regarding required disclosure. As such, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the period covered by this report.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of the changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

There have been no changes in our internal control over financial reporting that occurred during our last fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

47

PART II - OTHER INFORMATION

ITEM  1. LEGAL PROCEEDINGS

See the information under the heading "Commitments and Contingencies" in Note 14 to the condensed consolidated financial statements contained in Part I, Item 1 of this report, which is incorporated in this Part II, Item 1 by reference.

ITEM  2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

In fiscal 2015, the Company's Board of Directors approved a stock repurchase program (the "Repurchase Program") authorizing the repurchase of up to $200.0 million of the Company's common stock from time to time on the open market or in privately negotiated transactions. The Repurchase Program does not require the Company to acquire any particular amount of common stock and does not specify the timing of purchases or the prices to be paid; however, the program will continue until the maximum amount of dollars authorized have been expended or until it is modified or terminated by the Board. No shares were repurchased during the third quarter of fiscal 2018. A total of approximately $160.0 million remained of the existing repurchase authority at December 31, 2017.

ITEM  6. EXHIBITS

Exhibit No.	Description	Filed Herewith
4.1	Indenture, dated as of December 7, 2017, by and among RBS Global, Inc., Rexnord LLC, the guarantors named therein and Wells Fargo Bank, National Association, as trustee*
4.2	Form of RBS Global, Inc. and Rexnord LLC 4.875% Senior Notes due 2025 (included in Exhibit 4.1)*
4.3	Parent Guarantee, dated as of December 7, 2017, by and between Rexnord Corporation and Wells Fargo Bank, National Association, as trustee*
10.1	Incremental Assumption Agreement, dated as of December 7, 2017, among Chase Acquisition I, Inc., RBS Global, Inc., Rexnord LLC, certain domestic subsidiaries of Rexnord Corporation, Credit Suisse AG, Cayman Islands Branch, as administrative agent, Credit Suisse AG, Cayman Islands Branch, as refinancing term lender, and the other lenders party thereto*
10.2	Purchase Agreement, dated November 30, 2017, among RBS Global, Inc., Rexnord LLC, the Guarantors named therein, Rexnord Corporation and Credit Suisse Securities (USA) LLC, as representative of the Purchasers named therein**
10.3	Form of Indemnification Agreement (reflects non-material changes from the prior form of agreement)	X
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.	X
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.	X
32.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350	X
101.INS	XBRL Instance Document	X
101.SCH	XBRL Taxonomy Extension Schema Document	X
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document	X
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document	X
101.LAB	XBRL Taxonomy Extension Label Linkbase Document	X
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document	X

________________________

* Incorporated by reference to the same exhibit number in the Company’s Form 8-K, dated December 7, 2017.

** Incorporated by reference to Exhibit 1.1 to the Company’s Form 8-K, dated November 30, 2017.

48

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, Rexnord Corporation has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		REXNORD CORPORATION
Date:	January 31, 2018	By:	/S/     MARK W. PETERSON
		Name:	Mark W. Peterson
		Title:	Senior Vice President and Chief Financial Officer

49

EX-10.3

DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENT THIS DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENT (this “Agreement”) is made as of this [____] day of [_________], 20__, by and between Rexnord Corporation, a Delaware corporation (the “Company”), and [____________] (the “Indemnitee”). WHEREAS, the Company desires to attract and retain the services of highly qualified individuals to act as directors and officers; WHEREAS, increased corporate litigation and investigations have subjected directors and officers to litigation risks and expenses, and the limitations on the availability and terms of director and officer liability insurance have made it increasingly difficult for the Company to attract and retain such persons; WHEREAS, the Company’s certificate of incorporation authorizes the Company to provide indemnification and advancement rights to directors and officers through bylaw provisions or through agreements with directors and officers, or otherwise, to the extent provided therein; WHEREAS, the Company’s bylaws require that the Company indemnify its directors and officers as authorized by the General Corporation Law of the State of Delaware (“DGCL”), as amended, under which the Company is incorporated, and such bylaws expressly provide that the indemnification provided therein is not exclusive and contemplate that the Company may enter into separate agreements with its directors, officers and other persons to set forth specific indemnification provisions; WHEREAS, in light of the fact that the certificate of incorporation and bylaws of the Company are subject to change and do not contain all the provisions and protections set forth in this Agreement, the Company has determined that the Indemnitee and other directors and officers of the Company may not be willing to serve or continue to serve in such capacities without additional protection; WHEREAS, the Company desires and has requested the Indemnitee to serve or continue to serve as a director or officer of the Company, as the case may be, and has proffered this Agreement to the Indemnitee as an additional inducement to serve in such capacity; and WHEREAS, the Indemnitee is willing to serve, or to continue to serve, as a director or officer of the Company, as the case may be, if the Indemnitee is furnished the indemnity provided for herein by the Company. NOW, THEREFORE, in consideration of the promises and the covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Indemnitee do hereby covenant and agree as follows:

-2- 1. Definitions. (a) “Change in Control” means, and shall be deemed to have occurred if, (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended), other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company acting in such capacity or a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, becomes the “beneficial owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing more than fifty percent (50%) of the total voting power represented by the Company’s then outstanding voting stock, (ii) during any period of two (2) consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Board of Directors of the Company and any new director whose election by the Board of Directors or nomination for election by the Company’s stockholders was approved by a vote of at least a majority of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof, (iii) the stockholders of the Company approve a merger or consolidation of the Company with any other corporation other than a merger or consolidation that would result in the voting stock of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting stock of the surviving entity) at least fifty percent (50%) of the total voting power represented by the voting stock of the Company or such surviving entity outstanding immediately after such merger or consolidation or with the power to elect at least a majority of the board of directors or other governing body of the surviving entity, or (iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company (in one transaction or a series of related transactions) of all or substantially all of the Company’s assets. (b) “Corporate Status” describes the status of a person who is serving or has served (i) as a director or officer of the Company, (ii) as a Company employee in a fiduciary capacity with respect to an employee benefit plan of the Company or (iii) as a director or officer of any other Entity at the request of the Company. For purposes of subsection (iii) of this Section l(b), a director or officer of the Company who is serving or has served as a director or officer of a Subsidiary shall be deemed to be serving at the request of the Company. (c) “Disinterested Director” means a director of the Company who (i) is not and was not a party to the Proceeding in respect of which indemnification is sought by the Indemnitee and (ii) is determined to be “disinterested” under applicable Delaware state law. (d) “Entity” shall mean any corporation, partnership (general or limited), limited liability company, joint venture, trust, employee benefit plan, company, foundation, association, organization or other legal entity, other than the Company.

-3- (e) “Expenses” shall be construed broadly to mean all direct and indirect fees of any type or nature whatsoever, costs and expenses incurred in connection with any Proceeding, including, without limitation, all attorneys’ fees and costs, disbursements and retainers (including, without limitation, any fees, disbursements and retainers incurred by the Indemnitee pursuant to Section 10 of this Agreement), fees and disbursements of experts, witnesses, private investigators and professional advisors (including, without limitation, accountants and investment bankers), court costs, filing fees, transcript costs, fees of experts, travel expenses, duplicating, imaging, printing and binding costs, telephone and fax transmission charges, computer legal research costs, postage, delivery service fees, secretarial services, fees and expenses of third party vendors; the premium, security for, and other costs associated with any bond (including supersedeas or appeal bonds, injunction bonds, cost bonds, appraisal bonds or their equivalents), in each case incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding (including, without limitation, any judicial or arbitration Proceeding brought to enforce the Indemnitee’s rights under, or to recover damages for breach of, this Agreement), as well as all other “expenses” within the meaning of that term as used in Section 145 of the DGCL, any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, ERISA excise taxes and penalties, and all other disbursements or expenses of types customarily and reasonably incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, actions, suits, or proceedings similar to or of the same type as the Proceeding with respect to which such disbursements or expenses were incurred. Expenses also shall include Expenses incurred in connection with any appeal resulting from any Proceeding. (f) “Indemnifiable Expenses,” “Indemnifiable Liabilities” and “Indemnifiable Amounts” shall have the meanings ascribed to those terms in Section 3(a) below. (g) “Independent Counsel” means a law firm, or a person admitted to practice law in any State of the United States, that is experienced in matters of corporation law and neither presently is, nor in the past three years has been, retained to represent: (i) the Company or the Indemnitee in any matter material to either such party (other than with respect to matters concerning the Indemnitee under this Agreement, or of other indemnities under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not include any law firm or person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or the Indemnitee in an action to determine the Indemnitee’s rights under this Agreement. (h) “Liabilities” shall be broadly construed to mean, without limitation, all judgments, damages, liabilities, losses, penalties, taxes, fines and amounts paid in settlement, in each case, of any type whatsoever, in connection with a Proceeding. References herein to “fines” shall include any excise tax assessed with respect to any employee benefit plan.

-4- (i) “Proceeding” shall be construed broadly to mean, without limitation, any threatened, pending or completed claim, government, regulatory and self-regulatory action, suit, arbitration, mediation, alternate dispute resolution process, investigation (including any internal investigation), inquiry, administrative hearing, appeal, or any other actual, threatened or completed proceeding, whether brought in the right of the Company or otherwise and whether of a civil (including intentional or unintentional tort claims), criminal, administrative, arbitrative or investigative nature, whether formal or informal, including a proceeding initiated by the Indemnitee pursuant to Section 10 of this Agreement to enforce the Indemnitee’s rights hereunder. (j) “Subsidiary” shall mean any Entity of which the Company owns (either directly or indirectly) either (i) a general partner, managing member or other similar interest or (ii) (A) 50% or more of the voting power of the voting capital equity interests of such Entity, or (B) 50% or more of the outstanding voting capital stock or other voting equity interests of such Entity. (k) References herein to a director of any other Entity shall include, in the case of any Entity that is not managed by a board of directors, such other position, such as manager or trustee or member of the governing body of such Entity, that entails responsibility for the management and direction of such Entity’s affairs, including, without limitation, the general partner of any partnership (general or limited) and the manager or managing member of any limited liability company. 2. Services by the Indemnitee. In consideration of the Company’s covenants and commitments hereunder, the Indemnitee agrees to serve or continue to serve as either a director on the board of directors of the Company or as officer, as applicable, so long as the Indemnitee is duly elected or appointed and until such time as the Indemnitee is removed, terminated, or tenders a resignation. This Agreement is effective as of the date the Indemnitee became a director or officer of the Company, as the case may be. 3. Agreement to Indemnify. The Company agrees to indemnify the Indemnitee to the fullest extent permitted, and in the manner permitted, by applicable law as in effect as of the date hereof or as such laws may, from time to time, be amended (but only if amended in a way that broadens the right to indemnification and advancement of expenses) as follows: (a) Indemnification for Third Party Proceedings. Subject to the exceptions contained in Section 4(a) and Section 6 below, if the Indemnitee was or is a party or was or is otherwise involved in or was or is threatened to be made a party or is otherwise involved in any capacity to any Proceeding (other than an action by or in the right of the Company) by reason of the Indemnitee’s Corporate Status, the Indemnitee shall be indemnified by the Company to the fullest extent permitted by the DGCL, as the same may be amended from time to time, against all Expenses and Liabilities actually and reasonably incurred or paid by the Indemnitee or on the Indemnitee’s behalf in connection with such a Proceeding (referred to herein as “Indemnifiable Expenses” and “Indemnifiable Liabilities,” respectively, and collectively as “Indemnifiable Amounts”). In addition, the Indemnitee’s Corporate Status may allow for indemnification under certain agreements containing indemnity provisions with another Entity or protections

-5- under the organization documents of such other Entity. In those instances, the Company is still wholly liable for making any indemnification payments for all Indemnifiable Amounts notwithstanding the payment obligation of such amounts by a third party to the Indemnitee; provided, however, that if and to the extent that the Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement, or otherwise, the Company shall not be liable under this Agreement to make any payment to the Indemnitee with respect to such Indemnifiable Amounts that have been satisfied. Nothing hereunder is intended to affect any right of contribution of or against the Company in the event the Company and any other person or persons have co-equal obligations to indemnify (or advance expenses to) the Indemnitee. (b) Indemnification in Derivative Actions and Direct Actions by the Company. Subject to the exceptions contained in Section 4(b) and Section 6 below, if the Indemnitee was or is a party or was or is otherwise involved in or was or is threatened to be made a party to or was or is otherwise involved in any capacity in any Proceeding by or in the right of the Company to procure a judgment in its favor by reason of the Indemnitee’s Corporate Status, the Indemnitee shall be indemnified by the Company against all Indemnifiable Expenses. In addition, the Indemnitee’s Corporate Status may allow for indemnification under certain agreements containing indemnity provisions with another Entity or protections under the organization documents of such other Entity. In those instances, the Company is still wholly liable for making any indemnification payments for all Indemnifiable Expenses notwithstanding the payment obligation of such amounts by a third party to the Indemnitee; provided, however, that if and to the extent that the Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement, or otherwise, the Company shall not be liable under this Agreement to make any payment to the Indemnitee with respect to such Indemnifiable Expenses that have been satisfied. Nothing hereunder is intended to affect any right of contribution of or against the Company in the event the Company and any other person or persons have co-equal obligations to indemnify (or advance expenses to) the Indemnitee. 4. Exceptions to Indemnification. The Indemnitee shall be entitled to indemnification under Section 3(a) and Section 3(b) above in all circumstances other than the following: (a) Exceptions to Indemnification for Third Party Proceedings. If indemnification is requested under Section 3(a) and there has been a final non-appealable judgment by a court of competent jurisdiction that, in connection with the subject of the Proceeding out of which the claim for indemnification has arisen, (x) the Indemnitee failed to act (i) in good faith and (ii) in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, or, (y) with respect to any criminal action or proceeding, the Indemnitee had reasonable cause to believe that the Indemnitee’s conduct was unlawful, the Indemnitee shall not be entitled to payment of Indemnifiable Amounts hereunder. (b) Exceptions to Indemnification in Derivative Actions and Direct Actions by the Company. If indemnification is requested under Section 3(b) and

-6- (i) there has been a final non-appealable judgment by a court of competent jurisdiction that, in connection with the subject of the Proceeding out of which the claim for indemnification has arisen, the Indemnitee failed to act (A) in good faith and (B) in a manner the Indemnitee believed to be in or not opposed to the best interests of the Company, the Indemnitee shall not be entitled to payment of Indemnifiable Expenses hereunder; or (ii) there has been a final non-appealable judgment by a court of competent jurisdiction that the Indemnitee is liable to the Company with respect to any claim, issue or matter involved in the Proceeding out of which the claim for indemnification has arisen, then no Indemnifiable Expenses shall be paid with respect to such claim, issue or matter unless the court of competent jurisdiction in which such Proceeding was brought shall determine upon application that, despite the adjudication of liability, but in view of all the circumstances of the case, the Indemnitee is fairly and reasonably entitled to indemnity for such Indemnifiable Expenses which such court shall deem proper. (c) For purposes of this Agreement, if the Indemnitee has acted in good faith and in a manner the Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, the Indemnitee shall be deemed to have acted in a manner not opposed to the best interests of the Company. 5. Procedure for Payment of Indemnifiable Amounts. (a) Subject to Section 9, the Indemnitee shall submit to the Company a written request specifying in reasonable detail the Indemnifiable Amounts for which the Indemnitee seeks payment under Section 3, Section 6, or Section 7 of this Agreement and a short description of the basis for the claim. The Company shall pay such Indemnifiable Amounts to the Indemnitee within sixty (60) calendar days of receipt of the request. At the request of the Company, the Indemnitee shall furnish such documentation and information as are reasonably available to the Indemnitee and necessary to establish that the Indemnitee is entitled to indemnification hereunder. (b) Upon written request by the Indemnitee for indemnification pursuant to the first sentence of Section 5(a) hereof, if required by applicable law and to the extent not otherwise provided pursuant to the terms of this Agreement, a determination with respect to the Indemnitee’s entitlement to indemnification shall be made in the specific case as follows: (i) if a Change in Control shall have occurred and if so requested in writing by the Indemnitee, by Independent Counsel in a written opinion to the Board of Directors; or (ii) if a Change in Control shall not have occurred (or if a Change in Control shall have occurred but the Indemnitee shall not have requested that indemnification be determined by Independent Counsel as provided in subpart (i) of this Section 5(b)), (A) by a majority vote of the Disinterested Directors, even though less than a quorum of the Board of Directors, or (B) by a committee of Disinterested Directors designated by majority vote of the Disinterested Directors, even though less than a quorum of the Board of Directors, (C) if there are no such Disinterested Directors or, if such Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board of

-7- Directors, or (D) by the Company’s stockholders in accordance with applicable law. Notice in writing of any determination as to the Indemnitee’s entitlement to indemnification shall be delivered to the Indemnitee promptly after such determination is made, and if such determination of entitlement to indemnification has been made by Independent Counsel in a written opinion to the Board of Directors, then such notice shall be accompanied by a copy of such written opinion. If it is determined that the Indemnitee is entitled to indemnification, then payment to the Indemnitee of all amounts to which the Indemnitee is determined to be entitled (other than sums that were already advanced) shall be made within sixty (60) calendar days after such determination. If it is determined that the Indemnitee is not entitled to indemnification, then the written notice to the Indemnitee (or, if such determination has been made by Independent Counsel in a written opinion, the copy of such written opinion delivered to the Indemnitee) shall disclose the basis upon which such determination is based. The Indemnitee shall cooperate with the person, persons, or entity making the determination with respect to the Indemnitee’s entitlement to indemnification, including providing to such person, persons, or entity upon reasonable advance request any documentation or information that is not privileged or otherwise protected from disclosure and that is reasonably available to the Indemnitee and reasonably necessary to determine whether and to what extent the Indemnitee is entitled to indemnification. (c) If the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 5(b) hereof, the Independent Counsel shall be selected as provided in this Section 5(c). If a Change in Control shall not have occurred (or if a Change in Control shall have occurred but the Indemnitee shall not have requested that indemnification be determined by Independent Counsel as provided in subpart (i) of Section 5(b)), then the Independent Counsel shall be selected by the Board of Directors, and the Company shall give written notice to the Indemnitee advising the Indemnitee of the identity of the Independent Counsel so selected. If a Change in Control shall have occurred and the Indemnitee shall have requested that indemnification be determined by Independent Counsel, then the Independent Counsel shall be selected by the Indemnitee (unless the Indemnitee shall request that such selection be made by the Board of Directors, in which event the preceding sentence shall apply), and the Indemnitee shall give written notice to the Company advising it of the identity of the Independent Counsel so selected. In either event, the Indemnitee or the Company, as the case may be, may, within thirty (30) calendar days after such written notice of selection has been given, deliver to the Company or to the Indemnitee, as the case may be, a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the law firm or person so selected does not meet the requirements of “Independent Counsel” as defined in Section 1 of this Agreement, and the objection shall set forth the basis of such assertion. Absent a proper and timely objection, the person so selected shall act as Independent Counsel. If such written objection is so made and substantiated, the law firm or person so selected may not serve as Independent Counsel unless and until such objection is withdrawn or the Court of Chancery of the State of Delaware or another court of competent jurisdiction in the State of Delaware has determined that such objection is without merit. If the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 5(b) hereof and, following the expiration of sixty (60) calendar days after submission by the Indemnitee of a written request for indemnification pursuant to Section 5(a) hereof, Independent Counsel shall not have been selected, or an objection thereto has been made and not withdrawn, then either the Company or the Indemnitee may petition the Court of Chancery of the State of Delaware or other court of competent jurisdiction in the State of Delaware for resolution of any

-8- objection that shall have been made by the Company or the Indemnitee to the other’s selection of Independent Counsel and/or for appointment as Independent Counsel of a law firm or person selected by such court (or selected by such person as the court shall designate), and the law firm or person with respect to whom all objections are so resolved or the law firm or person so appointed shall act as Independent Counsel under Section 5(b) hereof. Upon the due commencement of any Proceeding pursuant to Section 11(e) hereof, Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing). If the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 5(b) hereof, then the Company agrees to pay the reasonable fees and expenses of such Independent Counsel and to fully indemnify and hold harmless such Independent Counsel against any and all expenses, claims, liabilities, and damages arising out of or relating to this Agreement or its engagement pursuant hereto. 6. Indemnification for Expenses if the Indemnitee is Wholly or Partly Successful. Notwithstanding anything contained in this Agreement to the contrary, to the extent that the Indemnitee is or was, or is or was threatened to be made, by reason of the Indemnitee’s Corporate Status, a party to and is successful, on the merits or otherwise, in defending any Proceeding, the Indemnitee shall be indemnified against all Indemnifiable Expenses incurred by the Indemnitee or on the Indemnitee’s behalf in connection with the defense of such Proceeding. If the Indemnitee is not wholly successful in such Proceeding but is successful on the merits or otherwise as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify the Indemnitee for the portion thereof to which the Indemnitee is entitled. If the Indemnitee is not wholly successful in such Proceeding, the Company also shall indemnify, hold harmless and exonerate the Indemnitee against all Expenses reasonably incurred in connection with a claim, issue or matter related to any claim, issue, or matter on which the Indemnitee was successful. For purposes of this Agreement, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter. Notwithstanding any of the foregoing, nothing herein shall be construed to limit the Indemnitee’s right to indemnification which he or she would otherwise be entitled to pursuant to Section 3 and Section 4 hereof, regardless of the Indemnitee’s success in a Proceeding. 7. Indemnification for Expenses as a Witness. Anything in this Agreement to the contrary notwithstanding, to the fullest extent permitted by applicable law, to the extent that the Indemnitee, by reason of the Indemnitee’s Corporate Status, is or was, or is or was threatened to be made, a witness in any Proceeding to which the Indemnitee is not a party, the Indemnitee shall be indemnified against all Indemnifiable Expenses incurred by the Indemnitee or on the Indemnitee’s behalf in connection therewith. To the extent permitted by applicable law, the Indemnitee shall be entitled to indemnification for Expenses incurred in connection with being or threatened to be made a witness, as provided in this Section 7, regardless of whether the Indemnitee met the standards of conduct set forth in Sections 4(a) and 4(b) hereof. 8. Agreement to Advance Expenses; Conditions. The Company shall pay to the Indemnitee all Indemnifiable Expenses incurred by or on behalf of the Indemnitee in connection with any Proceeding to which the Indemnitee was or is a party or was or is otherwise involved or was or is threatened to be made a party to or was or is otherwise involved in any capacity in any

-9- Proceeding by reason of the Indemnitee’s Corporate Status, including a Proceeding by or in the right of the Company, in advance of the final disposition of such Proceeding. The Indemnitee hereby undertakes to repay the amount of Indemnifiable Expenses paid to the Indemnitee if it shall ultimately be determined by final judicial decision of a court of competent jurisdiction, from which decision there is no further right to appeal, that the Indemnitee is not entitled under this Agreement to, or is prohibited by applicable law from, indemnification with respect to such Indemnifiable Expenses. Any advances and undertakings to repay pursuant to this Section 8 shall be unsecured and interest free. The Indemnitee shall be entitled to advancement of Indemnifiable Expenses as provided in this Section 8 regardless of any determination by or on behalf of the Company that the Indemnitee has not met the standards of conduct set forth in Sections 4(a) and 4(b) hereof. 9. Procedure for Advance Payment of Expenses. The Indemnitee shall submit to the Company a written request specifying in reasonable detail the Indemnifiable Expenses for which the Indemnitee seeks an advancement under Section 8 of this Agreement, together with documentation reasonably evidencing that the Indemnitee has incurred such Indemnifiable Expenses. Payment of Indemnifiable Expenses under Section 8 shall be made no later than sixty (60) calendar days after the Company’s receipt of such request. 10. Burden of Proof; Defenses; and Presumptions. (a) In any Proceeding pursuant to Section 11 hereof brought by the Indemnitee to enforce rights to indemnification or to an advancement of Indemnifiable Expenses hereunder, or in any Proceeding brought by the Company to recover an advancement of Indemnifiable Expenses (whether pursuant to the terms of an undertaking or otherwise), the burden shall be on the Company to prove that the Indemnitee is not entitled to be indemnified, or to such an advancement of Indemnifiable Expenses, as the case may be. (b) It shall be a defense in any Proceeding pursuant to Section 11 hereof to enforce rights to indemnification under Section 3(a) or Section 3(b) hereof (but not in any Proceeding pursuant to Section 11 hereof to enforce a right to an advancement of Indemnifiable Expenses under Sections 8 and 9 hereof) that the Indemnitee has not met the standards of conduct set forth in Section 4(a) or Section 4(b), as the case may be, but the burden of proving such defense shall be on the Company. With respect to any Proceeding pursuant to Section 11 hereof brought by the Indemnitee to enforce a right to indemnification hereunder, or any Proceeding brought by the Company to recover an advancement of Indemnifiable Expenses (whether pursuant to the terms of an undertaking or otherwise), neither (i) the failure of the Company (including by its directors or independent legal counsel) to have made a determination prior to the commencement of such Proceeding that indemnification is proper in the circumstances because the Indemnitee has met the applicable standards of conduct, nor (ii) an actual determination by the Company (including by its directors or independent legal counsel) that the Indemnitee has not met such applicable standards of conduct, shall create a presumption that the Indemnitee has not met the applicable standards of conduct or, in the case of a Proceeding pursuant to Section 11 hereof brought by the Indemnitee seeking to enforce a right to indemnification, be a defense to such Proceeding. (c) The termination of any Proceeding by judgment, order, settlement,

-10- conviction, or upon a plea of nolo contendre or its equivalent, shall not, in and of itself, adversely affect the right of the Indemnitee to indemnification hereunder or create a presumption that the Indemnitee did not act in good faith and in a manner the Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal Proceeding, shall not create a presumption that the Indemnitee had reasonable cause to believe that his or her conduct was unlawful. (d) For purposes of any determination of good faith, the Indemnitee shall be deemed to have acted in good faith if the Indemnitee’s action is reasonably based on the records or books of account of the Company or other Entity, including financial statements, or on information supplied to the Indemnitee by the officers of the Company or other Entity in the course of their duties, or on the advice of legal counsel for the Company or other Entity or on information or records given or reports made to the Company or other Entity by an independent certified public accountant or by an appraiser or other expert selected by the Company or other Entity. The provisions of this Section 10(d) shall not be deemed to be exclusive or to limit in any way the other circumstances in which the Indemnitee may be deemed or found to have met the applicable standard of conduct set forth in this Agreement. (e) The knowledge and/or actions, or failure to act, of any other director, officer, agent, or employee of the Company or of an other Entity shall not be imputed to the Indemnitee for purposes of determining the Indemnitee’s right to indemnification or advancement of Indemnifiable Expenses under this Agreement. 11. Remedies of the Indemnitees. (a) Right to Petition Court. In the event that the Indemnitee makes a request for payment of Indemnifiable Amounts under Section 3 or Section 5 herein or a request for an advancement of Indemnifiable Expenses under Sections 8 or Section 9 herein and the Company fails to make such payment or advancement in a timely manner pursuant to the terms of this Agreement, the Indemnitee may petition a court to enforce the Company’s obligations under this Agreement. (b) Expenses. The Company agrees to reimburse the Indemnitee in full for any Expenses actually and reasonably incurred by the Indemnitee in connection with investigating, preparing for, litigating, defending or settling any action brought by the Indemnitee under Section 11(a) above; provided, however, that to the extent the Indemnitee is unsuccessful on the merits in such action then the Company shall have no obligation to reimburse the Indemnitee under this Section 11(b) (c) Validity of Agreement. The Company shall be precluded from asserting in any Proceeding, including, without limitation, an action under Section 11(a) above, that the provisions of this Agreement are not valid, binding and enforceable or that there is insufficient consideration for this Agreement and shall stipulate in court that the Company is bound by all the provisions of this Agreement. (d) Failure to Act Not a Defense. The failure of the Company (including its Board of Directors or any committee thereof, independent legal counsel, or stockholders)

-11- to make a determination concerning the permissibility of the payment of Indemnifiable Amounts or the advancement of Indemnifiable Expenses under this Agreement shall not be a defense in any action brought under Section 10(a) above, and shall not create a presumption that such payment or advancement is not permissible (e) Entitlement to Indemnification; Independent Counsel. In the event that (i) a determination is made pursuant to Section 5 of this Agreement that the Indemnitee is not entitled to indemnification under this Agreement, (ii) if the determination of entitlement to indemnification is not to be made by Independent Counsel pursuant to Section 5(b) hereof, no determination of entitlement to indemnification shall have been made pursuant to Section 5(b) of this Agreement within sixty (60) calendar days after receipt by the Company of the Indemnitee’s written request for indemnification, (iii) if the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 5(b) hereof, no determination of entitlement to indemnification shall have been made pursuant to Section 5(b) hereof within eighty (80) calendar days after receipt by the Company of the Indemnitee’s written request for indemnification, unless an objection to the selection of such Independent Counsel has been made and substantiated and not withdrawn, in which case the applicable time period shall be seventy (70) calendar days after the Court of Chancery of the State of Delaware or another court of competent jurisdiction in the State of Delaware (or such person appointed by such court to make such determination) has determined or appointed the person to act as Independent Counsel pursuant to Section 5(b) hereof, (iv) payment of indemnification is not made pursuant to Section 6 or Section 7 of this Agreement within sixty (60) calendar days after receipt by the Company of a written request therefor, or (v) payment of indemnification pursuant to Section 6 or Section 7 of this Agreement is not made within sixty (60) calendar days after a determination has been made pursuant to Section 5(b) that the Indemnitee is entitled to indemnification, then the Indemnitee shall be entitled to seek an adjudication by the Court of Chancery of the State of Delaware of the Indemnitee’s entitlement to such indemnification or advancement of Indemnifiable Expenses. (f) Not Prejudiced by Adverse Determination. In the event that a determination shall have been made pursuant to Section 5(b) of this Agreement that the Indemnitee is not entitled to indemnification, any Proceeding commenced pursuant to this Section 11 shall be conducted in all respects as a de novo trial, or arbitration, on the merits and the Indemnitee shall not be prejudiced by reason of that adverse determination. 12. Settlement of Proceedings. (a) The Indemnitee agrees that it will not settle, compromise or consent to the entry of any judgment as to the Indemnitee in any pending or threatened Proceeding (whether or not the Indemnitee is an actual or potential party to such Proceeding) in which Indemnitee has sought indemnification hereunder without the Company’s prior written consent, which consent will not be unreasonably withheld, unless such settlement, compromise or consent respecting such Proceeding includes an unconditional release of you and does not (i) require or impose any injunctive or other non-monetary remedy on the Company or its affiliates, (ii) require or impose an admission or consent as to any

-12- wrongdoing by the Company or its affiliates, or (iii) otherwise result in a direct or indirect payment by or monetary cost to the Company or its affiliates. (b) The Company agrees that it will not settle, compromise or consent to the entry of any judgment as to the Indemnitee in any pending or threatened Proceeding (whether or not the Indemnitee is an actual or potential party to such Proceeding) in which the Indemnitee has sought indemnification hereunder without the Indemnitee’s prior written consent, which consent shall not be unreasonably withheld, unless such settlement, compromise or consent includes an unconditional release of the Indemnitee and does not (i) require or impose any injunctive or other non-monetary remedy on the Indemnitee, (ii) require or impose an admission or consent as to any wrongdoing by the Indemnitee or (iii) otherwise result in a direct or indirect payment by or monetary cost to the Indemnitee personally (as opposed to a payment to be made or cost to be paid by the Company on the Indemnitee’s behalf). 13. Notice by the Indemnitee. The Indemnitee agrees to notify the Company promptly upon being served with any summons, citation, subpoena, complaint, indictment, information, or other document relating to any Proceeding which could reasonably be expected to result in the payment of Indemnifiable Amounts or the advancement of Indemnifiable Expenses hereunder; provided, however, that the failure to give any such notice shall not disqualify the Indemnitee from the right to receive payments of Indemnifiable Amounts or advancements of Indemnifiable Expenses. 14. Representations and Warranties of the Company. The Company hereby represents and warrants to the Indemnitee as follows: (a) Authority. The Company has all necessary power and authority to enter into, and be bound by the terms of, this Agreement, and the execution, delivery and performance of the undertakings contemplated by this Agreement have been duly authorized by the Company. (b) Enforceability. This Agreement, when executed and delivered by the Company in accordance with the provisions hereof, shall be a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be limited by equitable principles and applicable bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the enforcement of creditors’ rights generally. (c) No Conflicts. This Agreement, when executed and delivered by the Company in accordance with the provisions hereof, does not, and the Company’s performance of its obligations under the Agreement will not violate the Company’s certificate of incorporation, bylaws, other agreements to which the Company is a party to or applicable law. (d) Insurance. The Company shall use its best efforts to cause the Indemnitee, at the Company’s expense, to be covered by such insurance policies or policies providing liability insurance for directors or officers of the Company or of any Subsidiary (“D&O

-13- Insurance”), if any, in accordance with its or their terms to the same extent as provided to any then-current director or officer of the Company or any Subsidiary under such policy or policies. 15. Contract Rights Not Exclusive; Subrogation. The rights to payment of Indemnifiable Amounts and advancement of Indemnifiable Expenses provided by this Agreement shall be in addition to, but not exclusive of, any other rights that the Indemnitee may have at any time under applicable law, the Company’s bylaws or certificate of incorporation, or any other agreement, vote of stockholders or directors (or a committee of directors), or otherwise, both as to action in the Indemnitee’s official capacity and as to action in any other capacity as a result of the Indemnitee’s serving in a Corporate Status. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy, given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy. In the event of any payment to or on behalf of the Indemnitee under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of the Indemnitee, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights. 16. Successors. This Agreement shall be (a) binding upon all successors and assigns of the Company (including any transferee of all or a substantial portion of the business, stock and/or assets of the Company and any direct or indirect successor by merger or consolidation or otherwise by operation of law) and (b) binding on and shall inure to the benefit of the heirs, personal representatives, executors and administrators of the Indemnitee. This Agreement shall continue for the benefit of the Indemnitee and such heirs, personal representatives, executors and administrators after the Indemnitee has ceased to have Corporate Status. 17. Change in Law. To the extent that a change in Delaware law (whether by statute or judicial decision) shall permit broader indemnification or advancement of expenses than is provided under the terms of the bylaws of the Company and this Agreement, the Indemnitee shall be entitled to such broader indemnification and advancements, and this Agreement shall be deemed to be amended to such extent, but only to the extent such amendment permits the Indemnitee to broader indemnification and advancement rights other than Delaware law permitted prior to the adoption of such amendment. 18. Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement, or any clause thereof, shall be determined by a court of competent jurisdiction to be illegal, invalid or unenforceable, in whole or in part, such provision or clause shall be limited or modified in its application to the minimum extent necessary to make such provision or clause valid, legal and enforceable, and the remaining provisions and clauses of this Agreement shall remain fully enforceable and binding on the parties. 19. Modifications and Waiver. Except as provided in Section 17 above with respect to changes in Delaware law which broaden the right of the Indemnitee to be indemnified by the

-14- Company, no supplement, modification or amendment of this Agreement shall be binding unless executed in writing by each of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions of this Agreement (whether or not similar), nor shall such waiver constitute a continuing waiver. 20. General Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given (a) when delivered by hand, (b) when transmitted by facsimile and receipt is acknowledged, or (c) if mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed (i) If to the Indemnitee, to: ___________________ ___________________ ___________________ (ii) If to the Company, to: Rexnord Corporation Attn: Office of the General Counsel 247 Freshwater Way, Suite 300 Milwaukee, WI 53204 Facsimile: 513-826-6690 or to such other address as may have been furnished in the same manner by any party to the others. 21. Contribution. To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever other than any of those set forth in Section 4 or Section 6 hereof the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s). 22. Governing Law. This Agreement shall be exclusively governed by and construed and enforced under the laws of the State of Delaware without giving effect to the provisions thereof relating to conflicts of law of such state. 23. Consent to Jurisdiction.

-15- (a) Each of the Company and the Indemnitee hereby irrevocably and unconditionally (i) agrees and consents to the jurisdiction of the courts of the State of Delaware for all purposes in connection with any action, suit, or proceeding that arises out of or relates to this Agreement and agrees that any such action instituted under this Agreement shall be brought only in the Court of Chancery of the State of Delaware (or in any other state court of the State of Delaware if the Court of Chancery does not have subject matter jurisdiction over such action), and not in any other state or federal court in the United States of America or any court or tribunal in any other country; (ii) consents to submit to the exclusive jurisdiction of the courts of the State of Delaware for purposes of any action or proceeding arising out of or in connection with this Agreement; (iii) waives any objection to the laying of venue of any such action or proceeding in the courts of the State of Delaware; and (iv) waives, and agrees not to plead or to make, any claim that any such action or proceeding brought in the courts of the State of Delaware has been brought in an improper or otherwise inconvenient forum. (b) Each of the Company and the Indemnitee hereby consents to service of any summons and complaint and any other process that may be served in any action, suit, or proceeding arising out of or relating to this Agreement in any court of the State of Delaware by mailing by certified or registered mail, with postage prepaid, copies of such process to such party at its address for receiving notice pursuant to Section 20 hereof. Nothing herein shall preclude service of process by any other means permitted by applicable law. 24. Counterparts. This Agreement may be executed in one or more counterparts (including by PDF or facsimile), each of which shall for all purposes be deemed to be an original but all of which together shall constitute but one and the same Agreement. Only one such counterpart need be produced to evidence the existence of this Agreement. 25. Headings. The headings of the sections of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction hereof. 26. Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings and negotiations, written and oral, between the parties with respect to the subject matter of this Agreement, provided, however, that this Agreement is supplement to and in furtherance of the Company’s certificate of incorporation, bylaws, the DGCL and any other applicable law, and shall not be deemed a substitute therefor, and does not diminish or abrogate any rights of the Indemnitee thereunder. [END OF TEXT]

16 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. COMPANY: REXNORD CORPORATION By: Name: Title: INDEMNITEE: By: Name:

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Todd A. Adams, President and Chief Executive Officer of Rexnord Corporation,certifies that:

1. I have reviewed this quarterly report on Form 10-Q of Rexnord Corporation;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrants' other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrants and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrants, including their consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrants' disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrants' internal control over financial reporting that occurred during the registrants' most recent fiscal quarter (the registrants' fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants' internal control over financial reporting; and

5. The registrants' other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants' auditors and the audit committee of registrants' board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants' ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants' internal control over financial reporting.

Date: January 31, 2018

By:	/s/ TODD A. ADAMS
Name:	Todd A. Adams
Title:	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Mark W. Peterson, Senior Vice President and Chief Financial Officer of Rexnord Corporation, certifies that:

1. I have reviewed this quarterly report on Form 10-Q of Rexnord Corporation;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrants' other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrants and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrants, including their consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrants' disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrants' internal control over financial reporting that occurred during the registrants' most recent fiscal quarter (the registrants' fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants' internal control over financial reporting; and

5. The registrants' other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants' auditors and the audit committee of registrants' board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants' ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants' internal control over financial reporting.

Date: January 31, 2018

By:	/s/ MARK W. PETERSON
Name:	Mark W. Peterson
Title:	Senior Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION

Pursuant to 18 United States Code § 1350

Each of the undersigned hereby certifies that the Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2017 of Rexnord Corporation filed with the Securities and Exchange Commission on or about the date hereof fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in such report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: January 31, 2018

By:	/s/ TODD A. ADAMS
Name:	Todd A. Adams
Title:	President and Chief Executive Officer

Date: January 31, 2018

By:	/s/ MARK W. PETERSON
Name:	Mark W. Peterson
Title:	Senior Vice President and Chief Financial Officer

This certification accompanies the Quarterly Report on Form 10-Q pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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Document and Entity Information - shares	9 Months Ended
	Dec. 31, 2017	Jan. 26, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	Rexnord Corp
Entity Central Index Key	0001439288
Document Type	10-Q
Document Period End Date	Dec. 31, 2017
Amendment Flag	false
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--03-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding (in shares)		103,978,699

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Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Dec. 31, 2017	Mar. 31, 2017
Current assets:
Cash and cash equivalents	$ 234.8	$ 490.1
Receivables, net	313.1	322.9
Inventories	349.9	314.9
Other current assets	57.1	50.2
Total current assets	954.9	1,178.1
Property, plant and equipment, net	389.3	400.9
Intangible assets, net	567.9	558.6
Goodwill	1,353.8	1,318.2
Other assets	84.1	83.5
Total assets	3,350.0	3,539.3
Current liabilities:
Current maturities of debt	0.2	16.5
Trade payables	199.6	197.8
Compensation and benefits	52.4	54.3
Current portion of pension and postretirement benefit obligations	4.4	4.3
Other current liabilities	126.7	127.4
Total current liabilities	383.3	400.3
Long-term debt	1,322.9	1,606.2
Pension and postretirement benefit obligations	170.9	174.4
Deferred income taxes	146.2	208.8
Other liabilities	72.6	79.0
Total liabilities	2,095.9	2,468.7
Stockholders' equity:
Preferred stock, $0.01 par value; 10,000,000 shares authorized; shares of 5.75% Series A Mandatory Convertible Preferred Stock issued and outstanding: 402,500 at December 31, 2017 and March 31, 2017	0.0	0.0
Common stock, $0.01 par value; 200,000,000 shares authorized; shares issued and outstanding: 103,934,204 at December 31, 2017 and 103,600,540 at March 31, 2017	1.0	1.0
Additional paid-in capital	1,270.1	1,262.1
Retained earnings (deficit)	75.8	(55.5)
Accumulated other comprehensive loss	(92.8)	(137.0)
Total stockholders' equity	1,254.1	1,070.6
Total liabilities and stockholders' equity	$ 3,350.0	$ 3,539.3

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Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	9 Months Ended	12 Months Ended
	Dec. 31, 2017	Mar. 31, 2017
Common Stock
Par value (in dollars per share)	$ 0.01	$ 0.01
Shares authorized (in shares)	200,000,000	200,000,000
Shares issued (in shares)	103,934,204	103,600,540
Shares outstanding (in shares)	103,934,204	103,600,540
Redeemable Convertible Preferred Stock
Preferred Stock
Dividend rate, percentage	5.75%	5.75%
Par value (in dollars per share)	$ 0.01	$ 0.01
Shares authorized (in shares)	10,000,000	10,000,000
Shares issued (in shares)	402,500	402,500
Shares outstanding (in shares)	402,500	402,500

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Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Income Statement [Abstract]
Net sales	$ 492.3	$ 451.8	$ 1,490.8	$ 1,414.6
Cost of sales	309.4	298.8	943.6	922.2
Gross profit	182.9	153.0	547.2	492.4
Selling, general and administrative expenses	107.3	99.9	326.6	313.1
Restructuring and other similar charges	3.8	11.7	11.6	21.7
Amortization of intangible assets	8.6	8.6	24.8	33.7
Income from operations	63.2	32.8	184.2	123.9
Non-operating expense:
Interest expense, net	(18.7)	(22.9)	(58.9)	(69.4)
Loss on the extinguishment of debt	(11.9)	(7.8)	(11.9)	(7.8)
Other expense, net	(1.0)	(0.7)	(2.5)	(3.3)
Income (loss) before income taxes from operations	31.6	1.4	110.9	43.4
Benefit for income taxes	(50.0)	(1.8)	(27.0)	(3.3)
Net income	81.6	3.2	137.9	46.7
Dividends on preferred stock	(5.8)	(1.5)	(17.4)	(1.5)
Net income attributable to Rexnord common stockholders	$ 75.8	$ 1.7	$ 120.5	$ 45.2
Net income per share attributable to Rexnord common stockholders:
Basic (in dollars per share)	$ 0.73	$ 0.02	$ 1.16	$ 0.44
Diluted (in dollars per share)	$ 0.67	$ 0.02	$ 1.13	$ 0.43
Weighted-average number of shares outstanding (in thousands):
Basic (in shares)	103,964	103,113	103,824	102,514
Diluted (in shares)	122,017	104,558	122,363	104,481

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Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Statement of Comprehensive Income [Abstract]
Net income	$ 81.6	$ 3.2	$ 137.9	$ 46.7
Other comprehensive income:
Foreign currency translation adjustments	7.5	(33.5)	41.6	(33.4)
Change in unrealized losses on interest rate derivatives, net of tax	0.7	3.3	3.6	5.6
Change in pension and postretirement defined benefit plans, net of tax	(0.4)	(0.3)	(1.0)	(0.9)
Other comprehensive income (loss), net of tax	7.8	(30.5)	44.2	(28.7)
Total comprehensive income (loss)	$ 89.4	$ (27.3)	$ 182.1	$ 18.0

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Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Operating activities
Net income	$ 137.9	$ 46.7
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	40.5	45.4
Amortization of intangible assets	24.8	33.7
Amortization of deferred financing costs	1.4	1.9
Loss on the extinguishment of debt	11.9	7.8
Non-cash asset impairment	0.0	1.6
Loss on dispositions of long-lived assets	0.4	0.2
Deferred income taxes	(76.2)	(15.9)
Other non-cash charges	3.0	(3.3)
Stock-based compensation expense	15.9	9.8
Changes in operating assets and liabilities:
Receivables	11.3	33.1
Inventories	(26.0)	(5.1)
Other assets	(6.3)	(7.2)
Accounts payable	(5.8)	(21.4)
Accruals and other	(10.9)	(5.2)
Cash provided by operating activities	121.9	122.1
Investing activities
Expenditures for property, plant and equipment	(25.1)	(44.0)
Acquisitions, net of cash acquired	(50.0)	(213.7)
Proceeds from dispositions of long-lived assets	5.5	1.9
Cash used for investing activities	(69.6)	(255.8)
Financing activities
Proceeds from borrowings of long-term debt	1,325.0	1,590.3
Repayments of long-term debt	(1,603.2)	(1,881.8)
Proceeds from borrowings of short-term debt	0.0	16.1
Repayments of short-term debt	(24.3)	(19.5)
Payment of debt issuance costs	(9.0)	(10.6)
Proceeds from exercise of stock options	2.9	9.6
Proceeds from financing lease obligations	5.8	0.0
Deferred acquisition payment	0.0	(5.7)
Proceeds from issuance of preferred stock, net of direct offering costs	0.0	390.2
Payments of dividend on preferred stock	(17.4)	0.0
Cash (used for) provided by financing activities	(320.2)	88.6
Effect of exchange rate changes on cash and cash equivalents	12.6	(10.2)
(Decrease) increase in cash and cash equivalents	(255.3)	(55.3)
Cash and cash equivalents at beginning of period	490.1	484.6
Cash and cash equivalents at end of period	$ 234.8	$ 429.3

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Basis of Presentation and Significant Accounting Policies

9 Months Ended

Dec. 31, 2017

Accounting Policies [Abstract]

Basis of Presentation and Significant Accounting Policies

Basis of Presentation and Significant Accounting Policies

The unaudited condensed consolidated financial statements included herein have been prepared by Rexnord Corporation ("Rexnord" or the "Company") in accordance with accounting principles generally accepted in the United States ("U.S. GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading.

In the opinion of management, the condensed consolidated financial statements include all adjustments necessary for a fair presentation of the results of operations for the interim periods. Results for the interim periods are not necessarily indicative of results that may be expected for the fiscal year ending March 31, 2018. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company's fiscal 2017 Annual Report on Form 10-K.

The Company

Rexnord is a growth-oriented, multi-platform industrial company with what it believes to be leading market shares and highly-trusted brands that serve a diverse array of global end markets. The Company's heritage of innovation and specification have allowed it to provide highly-engineered, mission-critical solutions to customers for decades and affords it the privilege of having long-term, valued relationships with market leaders. The Company operates in a disciplined way and the Rexnord Business System (“RBS”) is its operating philosophy. Grounded in the spirit of continuous improvement, RBS creates a scalable, process-based framework that focuses on driving superior customer satisfaction and financial results by targeting world-class operating performance throughout all aspects of its business.

The Process & Motion Control platform designs, manufactures, markets and services a comprehensive range of specified, highly-engineered mechanical components used within complex systems where our customers' reliability requirements and costs of failure or downtime are high. The Process & Motion Control portfolio includes motion control products, shaft management products, aerospace components, and related value-added services.

The Water Management platform designs, procures, manufactures, and markets products that provide and enhance water quality, safety, flow control and conservation. The Water Management product portfolio includes professional grade water control and safety, water distribution and drainage, finish plumbing, and site works products for primarily nonresidential buildings and flow control products for water and wastewater treatment infrastructure markets.

Recent Accounting Pronouncements

In August 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-12, Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12"), which expands and refines hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. ASU 2017-12 is effective for the beginning of the Company's fiscal 2020, with early adoption permitted, and must be applied prospectively. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.    

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). The amendments in ASU 2017-04 allow companies to apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 is effective for the beginning of the Company's fiscal 2021, with early adoption permitted, and must be applied prospectively. The Company is currently evaluating the timing of adoption; however, it does not believe the adoption of ASU 2017-04 will have a material impact on the Company's consolidated financial statements.

In February 2015, the FASB issued ASU 2016-02, Leases (Topic 842) ("ASU 2016-02''), which requires lessees to recognize lease assets and lease liabilities for all leases on the balance sheets. ASU 2016-02 is effective beginning for the Company's fiscal 2020 and interim periods included therein on a modified retrospective basis. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.    

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory ("ASU 2015-11"). ASU 2015-11 requires inventory to be measured at the lower of cost and net realizable value, which is defined as the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. Under existing guidance, net realizable value is one of several calculations needed to measure inventory at lower of cost or market and as such, the new guidance reduces the complexity in measurement. The Company adopted ASU No. 2015-11 prospectively effective April 1, 2017 and there was no impact to the Company's condensed consolidated financial statements.

In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,which changes how employers that sponsor defined benefit pension or other postretirement benefit plans present the net periodic benefit cost in the income statement. The new guidance requires the service cost component of net periodic benefit cost to be presented in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period with only the service cost component eligible for capitalization in assets. Other components of the net periodic benefit cost are to be stated separately from the line item(s) that includes the service cost and outside of operating income. The standard is required to be adopted for annual periods beginning after December 15, 2017, including interim periods within that annual period, which is the Company's fiscal year 2019. The amendment is to be applied retrospectively. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"), now referred to as Accounting Standards Codification ("ASC") Topic 606 ("ASC 606"), in order to develop a common revenue standard for U.S. GAAP and International Financial Reporting Standards. The guidance specifies revenue should be recognized in an amount that reflects the consideration the company expects to be entitled to in exchange for the transfer of promised goods or services to customers. The guidance provides a five-step process that entities should follow in order to achieve that core principal. ASC 606 will be effective for the Company on April 1, 2018. Companies can use either a full retrospective or modified retrospective method to adopt the standard. Under the full retrospective method, the requirements of the new standard are applied to contracts for each prior reporting period presented and the cumulative effect of applying the standard is recognized in the earliest period presented. Under the modified retrospective method, prior periods are not updated to be presented on an accounting basis that is consistent with information for fiscal 2019. Rather, a cumulative adjustment for the effects of applying the new standard to periods prior to fiscal 2019 is recorded to retained earnings as of April 1, 2018. The Company expects to adopt the new standard using the modified retrospective approach.

The Company is assessing the impact of the new revenue standard on its consolidated financial statements by reviewing its current accounting policies and practices, including detailed reviews of customer contracts, to identify potential differences that would result from applying the requirements of the new standard to its revenue contracts. In addition, ASC 606 will require more comprehensive disclosures about revenue streams and contracts with customers. The Company is currently evaluating potential changes to its processes, information systems and internal controls related to the preparation of disclosures required under ASC 606. The Company will provide additional disclosure as its ongoing assessment progresses.

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Acquisitions

9 Months Ended

Dec. 31, 2017

Business Combinations [Abstract]

Acquisitions

Acquisitions

Fiscal Year 2018 Acquisitions

On October 4, 2017, the Company acquired World Dryer Corporation (“World Dryer”) for a cash purchase price of $50.0 million, excluding transaction costs and net of cash acquired. World Dryer is a leading global manufacturer of commercial electric hand dryers. This acquisition broadened the product portfolio of the Company's existing Water Management platform and is expected to bring even greater value to commercial building owners in the form of lower operating costs.

The Company's results of operations include the acquired operations subsequent to October 4, 2017. Pro-forma results of operations and certain other U.S. GAAP disclosures related to the World Dryer acquisition have not been presented because they are not material to the Company's condensed consolidated statements of operations and condensed consolidated balance sheets.

The acquisition of World Dryer was accounted for as a business combination and recorded by allocating the purchase price to the fair value of assets acquired and liabilities assumed at the acquisition date. The excess of the acquisition purchase price over the fair value assigned to the assets acquired and liabilities assumed was recorded as goodwill. The preliminary purchase price allocation resulted in non-tax deductible goodwill of $25.8 million, other intangible assets of$28.1 million(includes tradenames of$7.0 millionand$21.1 millionof customer relationships) and other net liabilities of$3.9 million. The purchase price allocation is preliminary and subject to fair value adjustments that will be completed within the one year period following the acquisition date.

During the third quarter of fiscal 2018, the Company entered into a definitive agreement to acquire Centa Power Transmission (Centa Antriebe Kirschey GmbH) ("Centa") for an estimated purchase price of approximately €118 million. Centa, headquartered in Haan, Germany, is a leading manufacturer of premium flexible couplings and drive shafts for industrial, marine, rail and power generation applications. The acquisition of Centa will add complementary product lines to the Company's existing Process & Motion Control platform. The acquisition of Centa is subject to customary closing conditions and is expected to close during the fourth quarter of fiscal 2018. The Company's results of operation will not include Centa until the transaction is finalized.

Fiscal Year 2017 Acquisitions

On June 1, 2016, the Company acquired Cambridge International Holdings Corp. ("Cambridge") for a cash purchase price of $213.4 million. The purchase price consisted of an enterprise value of $210.0 million, excluding transaction costs and net of cash acquired, plus additional consideration of $3.4 million related to the acquisition of certain tax benefits and real property classified as held for sale at the acquisition date. Cambridge, with operations in Cambridge, Maryland and Matamoros, Mexico, is one of the world's largest suppliers of metal conveying and engineered woven metal solutions, primarily used in food processing end markets, as well as in architectural, packaging and filtration applications. The acquisition of Cambridge expanded the Company's presence in consumer-driven end markets in the Process & Motion Control platform.

The Company's results of operations include the acquired operations subsequent to June 1, 2016. Pro-forma results of operations and certain other U.S. GAAP disclosures related to the Cambridge acquisition have not been presented because they are not material to the Company's condensed consolidated statements of operations and condensed consolidated balance sheets.

The acquisition of Cambridge was accounted for as a business combination and recorded by allocating the purchase price to the fair value of assets acquired and liabilities assumed at the acquisition date. The excess of the acquisition purchase price over the fair value assigned to the assets acquired and liabilities assumed was recorded as goodwill. The purchase price allocation resulted in non-tax deductible goodwill of $129.4 million, other intangible assets of $80.6 million (includes tradenames of $16.8 million, customer relationships of $58.3 million and patents of $5.5 million) and other net assets of $3.4 million.

In fiscal 2017, the Company acquired the remaining non-controlling interest in aWater Management joint venturefor a cash purchase price of approximately$0.3 million, net of cash acquired and excluding transaction costs. The acquisition of the remaining minority interest was not material to the Company's condensed consolidated statements of operations or financial position.

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Restructuring and Other Similar Charges

9 Months Ended

Dec. 31, 2017

Restructuring and Related Activities [Abstract]

Restructuring and Other Similar Charges

Restructuring and Other Similar Charges

During fiscal 2018, the Company has continued to execute various restructuring actions. These initiatives were implemented to drive efficiencies and reduce operating costs while also modifying the Company's footprint to reflect changes in the markets it serves, the impact of acquisitions on the Company's overall manufacturing capacity and the refinement of its overall product portfolio. These restructuring actions primarily resulted in workforce reductions, lease termination costs, and other facility rationalization costs. Management expects to continue executing initiatives to optimize its operating margin and manufacturing footprint, as well as select product-line rationalizations. As such, the Company expects further expenses related to workforce reductions, potential impairment or accelerated depreciation of assets, lease termination costs, and other facility rationalization costs. The Company's restructuring plans are preliminary and related expenses are not yet estimable.

The following table summarizes the Company's restructuring and other similar charges during the three and nine months endedDecember 31, 2017 and December 31, 2016 by operating segment (in millions):

	Restructuring and Other Similar Charges Three Months Ended December 31, 2017
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	0.6	$	0.6	$	1.2
Contract termination and other associated costs	2.4		0.2		2.6
Total restructuring and other similar charges	$	3.0	$	0.8	$	3.8

	Restructuring and Other Similar Charges Nine Months Ended December 31, 2017
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	2.5	$	3.3	$	5.8
Contract termination and other associated costs	5.2		0.6		5.8
Total restructuring and other similar charges	$	7.7	$	3.9	$	11.6

	Restructuring and Other Similar Charges Three Months Ended December 31, 2016
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	5.1	$	1.7	$	6.8
Asset impairment charges (1)	1.6		—		1.6
Contract termination and other associated costs	1.9		1.4		3.3
Total restructuring and other similar charges	$	8.6	$	3.1	$	11.7

	Restructuring and Other Similar Charges Nine Months Ended December 31, 2016
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	9.6	$	5.4	$	15.0
Asset impairment charges (1)	1.6		—		1.6
Contract termination and other associated costs	3.4		1.7		5.1
Total restructuring and other similar charges	$	14.6	$	7.1	$	21.7

____________________

(1) In connection with the ongoing supply chain optimization and footprint repositioning initiatives, the Company has taken several actions to consolidate existing manufacturing facilities and rationalize its product offerings. These actions require the Company to assess whether the carrying amount of impacted long-lived assets will be recoverable as well as whether the remaining useful lives require adjustment. The Company recognized impairment charges associated with these assets during the three and nine months ended of fiscal 2017, in the amount of $1.6 million. The impairment was determined utilizing independent appraisals of the assets, classified as Level 3 inputs within the Fair Value hierarchy. Refer to Note 13, Fair Value Measurements for additional information.

The following table summarizes the activity in the Company's restructuring accrual for the nine months endedDecember 31, 2017 (in millions):

	Employee termination benefits			Contract termination and other associated costs			Total
Restructuring accrual, March 31, 2017 (1)	$	11.0		$	1.0		$	12.0
Charges	5.8			5.8			11.6
Cash payments	(13.3		)	(6.6		)	(19.9		)
Restructuring accrual, December 31, 2017 (1)	$	3.5		$	0.2		$	3.7

____________________

(1)     The restructuring accrual is included in Other current liabilities in the condensed consolidated balance sheets.

In addition to the impairment charges recognized above, the Company recognized accelerated depreciation of zero and $1.0 million during the three and nine months endedDecember 31, 2017, respectively. The Company recognized accelerated depreciation of $3.8 million and $5.2 million during the three and nine months endedDecember 31, 2016, respectively. Accelerated depreciation is recorded within Cost of sales in the condensed consolidated statements of operations.

During fiscal 2016, the Company decided to exit the non-strategic product lines sold under the Rodney Hunt Fontaine ("RHF") tradename and the Company completed the exit of the RHF product line in fiscal 2017. The Company evaluated the requirements for the presentation of discontinued operations in connection with the decision to exit its flow-control gate product line and determined the product line did not meet the definition provided within the authoritative literature as discontinued operations. Pre-tax loss from operations associated with the RHF product line was $2.2 million and $6.7 million in the three and nine months endedDecember 31, 2016, respectively. Pre-tax loss included restructuring and other similar charges of $0.3 million and $1.9 million in the three and nine months endedDecember 31, 2016, respectively.

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Income Taxes

9 Months Ended

Dec. 31, 2017

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (“U.S. Tax Reform”). U.S. Tax Reform incorporates significant changes to U.S. corporate income tax laws including, among other things, a reduction in the statutory federal corporate income tax rate from 35% to 21%, an exemption for dividends received from certain foreign subsidiaries, a one-time repatriation tax on deemed repatriated earnings from foreign subsidiaries, immediate expensing of certain depreciable tangible assets, limitations on the deduction for net interest expense and certain executive compensation and the repeal of the Domestic Production Activities Deduction ("DPAD"). The majority of these changes will be effective for the Company’s fiscal year beginning April 1, 2018. However, the corporate income tax rate reduction is effective January 1, 2018. As such, the Company’s effective statutory federal corporate income tax rate for the tax year ending March 31, 2018 will be 31.55%. In addition, the one-time repatriation tax will be recognized by the Company for the tax year ending March 31, 2018.

Under ASC Topic 740, Income Taxes ("ASC 740"), a company is generally required to recognize the effect of changes in tax laws in its financial statements in the period in which the legislation is enacted. U.S. income tax laws are deemed to be effective on the date the president signs tax legislation. The president signed the U.S. Tax Reform legislation on December 22, 2017. As such, the Company is required to recognize the related impacts to the financial statements in the quarter ended December 31, 2017. In acknowledgment of the substantial changes incorporated in the U.S. Tax Reform, in conjunction with the timing of the enactment being just weeks before the majority of the provisions became effective, the SEC staff issued Staff Accounting Bulletin ("SAB") 118 to provide certain guidance in determining the accounting for income tax effects of the legislation in the accounting period of enactment as well as provide a measurement period (similar to that used when accounting for business combinations) within which to finalize and reflect such final effects associated with U.S. Tax Reform. Further, SAB 118 summarizes a three-step approach to be applied each reporting period within the overall measurement period: (1) amounts should be reflected in the period including the date of enactment for those items which are deemed to be complete (i.e. all information is available and appropriately analyzed to determine the applicable financial statement impact), (2) to the extent the effects of certain changes due to U.S. Tax Reform for which the accounting is not deemed complete but for which a reasonable estimate can be determined, such provisional amount(s) should be reflected in the period so determined and adjusted in subsequent periods as such effects are finalized and (3) to the extent a reasonable estimate cannot be determined for a specific effect of the tax law change associated with U.S. Tax Reform, no provisional amount should be recorded but rather, continue to apply ASC 740 based upon the tax law in effect prior to the enactment of U.S. Tax Reform. Such measurement period is deemed to end when all necessary information has been obtained, prepared and analyzed such that a final accounting determination can be concluded, but in no event should the period extend beyond one year.

In consideration of this guidance, the Company has obtained, prepared and analyzed various information associated with the enactment of U.S. Tax Reform. Based upon this review, the Company has recognized a discrete estimated net income tax benefit with respect to U.S Tax Reform for the third quarter of fiscal 2018 of $54.8 million. This net income tax benefit reflects a $62.2 million net estimated income tax benefit associated with the remeasurement of the Company’s net U.S. deferred tax liability (including consideration of executive compensation limitations under U.S. Tax Reform), partiality offset with a $7.4 million estimated income tax expense associated with the impact of the deemed repatriated earnings from the Company’s foreign subsidiaries, including the one-time repatriation tax of $3.0 million. Due to the Company’s fiscal year-end of March 31, 2018 and the timing of the various technical provisions provided for under U.S. Tax Reform, the financial statement impacts recorded in the third quarter of fiscal 2018 relating to U.S. Tax Reform are not deemed to be complete but rather are deemed to be reasonable, provisional estimates based upon the current available information. For example, the remeasurement of the net U.S. deferred tax liability cannot be complete until the underlying timing differences are known, and such timing differences cannot be known until March 31, 2018. Similarly, the Company was required to use certain estimated annual amounts in conjunction with determining the impact of the one-time repatriation tax. Although the Company believes the net income tax benefit recognized in the third quarter of fiscal 2018 as outlined above is a reasonable estimate based upon the available information and analysis completed, these related amounts will change based upon actual results occurring in the quarter and fiscal year ending March 31, 2018. As such, the Company will update and finalize the accounting for the tax effect of the enactment of U.S. Tax Reform in future quarters in accordance with the guidance as outlined in SAB 118, as deemed necessary.

The provision for income taxes for all periods presented is based on an estimated effective income tax rate for the respective full fiscal years. As a result of enacted U.S. Tax Reform, the Company's estimated effective income tax rate incorporated the reduced federal statutory income tax rate of 31.55%, resulting in an income tax benefit of approximately $2.1 million for the third quarter (as well as the first nine months) of fiscal 2018. This benefit is in addition to the $54.8 million discrete estimated income tax benefit recorded in association with U.S. Tax Reform, as discussed above. The estimated annual effective income tax rate is determined excluding the effect of significant discrete items or items that are reported net of their related tax effects. The tax effect of significant discrete items is reflected in the period in which they occur. The Company's income tax provision is impacted by a number of factors, including the amount of taxable earnings derived in foreign jurisdictions with tax rates that are generally lower than the U.S. federal statutory rate, state tax rates in the jurisdictions where the Company does business and the Company's ability to utilize various tax credits and net operating loss (“NOL”) carryforwards.

The Company regularly reviews its deferred tax assets for recoverability and establishes valuation allowances based on historical losses, projected future taxable income and the expected timing of the reversals of existing temporary differences, as deemed appropriate. In addition, all other available positive and negative evidence is taken into consideration for purposes of determining the proper balances of such valuation allowances. As a result of this review, the Company continues to maintain valuation allowances against the deferred tax assets relating to certain foreign and state net operating loss carryforwards. Future changes to the balances of these valuation allowances, as a result of this continued review and analysis by the Company, could result in a material impact to the financial statements for such period of change.

The income tax benefit was $50.0 million in the third quarter of fiscal 2018 compared to an income tax benefit of $1.8 million in the third quarter of fiscal 2017. The effective income tax rate for the third quarter of fiscal 2018 was (158.2)% versus (128.6)% in the third quarter of fiscal 2017. The income tax benefit recorded on income before income taxes for the third quarter of fiscal 2018 was primarily due to the recognition of net income tax benefits associated with the enactment of U.S. Tax Reform, the recognition of net tax benefits associated with the reduction in the tax liability originally recorded on the expatriation of certain foreign branch assets, and the net tax benefits associated with U.S. research and development credits and the DPAD. The income tax benefit recorded on income before income taxes for the third quarter of fiscal 2017 was primarily due to excess tax benefits associated with share-based payments, the recognition of net tax benefits associated with U.S. research and development credits and the DPAD, partially offset with the recognition of income tax expense relating to various foreign income tax audits.

The income tax benefit recorded in the first nine months of fiscal 2018 was $27.0 million compared to an income tax benefit of $3.3 million in the first nine months of fiscal 2017. The effective income tax rate for the first nine months of fiscal 2018 was (24.3)% versus (7.6)% in the first nine months of fiscal 2017. The income tax benefit recorded on income before income taxes for the first nine months of fiscal 2018 was primarily due to the recognition of net income tax benefits associated with the enactment of U.S. Tax Reform, the recognition of net tax benefits associated with the reduction in the tax liability originally recorded on the expatriation of certain foreign branch assets, and the net tax benefits associated with U.S. research and development credits and the DPAD. The income tax benefit recorded on income before income taxes for the first nine months of fiscal 2017 was primarily due to excess tax benefits associated with share-based payments, the recognition of net tax benefits associated with U.S. research and development credits, the recognition of a worthless stock and bad debt deduction for U.S. income tax purposes relating to an insolvent foreign subsidiary and the recognition of excess U.S. foreign tax credits, partially offset with the recognition of income tax expense relating to various foreign income tax audits.

At December 31, 2017, the Company had a $19.0 million liability for unrecognized net income tax benefits. At March 31, 2017, the Company’s total liability for unrecognized net income tax benefits was $18.1 million. The Company recognizes accrued interest and penalties related to unrecognized income tax benefits in income tax expense. As of December 31, 2017 and March 31, 2017, the total amount of gross, unrecognized income tax benefits included $5.5 million and $4.7 million of accrued interest and penalties, respectively. The Company recognized $0.3 million of net interest and penalties as income tax expense during both the nine months endedDecember 31, 2017 and December 31, 2016.

The Company conducts business in multiple locations within and outside the U.S. Consequently, the Company is subject to periodic income tax examinations by domestic and foreign income tax authorities. Currently, the Company is undergoing routine, periodic income tax examinations in both domestic and foreign jurisdictions (including a review of a few specific items on certain corporate income tax returns of the Company’s Netherlands subsidiaries for the tax years ended March 31, 2011 through 2015). In addition, the U.S. Internal Revenue Service is currently examining the Company’s U.S. consolidated federal income tax return and related amended return for the tax year ended March 31, 2015. During the third quarter of fiscal 2017, the Company completed an examination of certain of its Italian subsidiaries’ corporate income tax returns for the tax years ended March 31, 2014 through 2016 and paid approximately $0.7 million upon the conclusion of such examination. In addition, during the fourth quarter of fiscal 2017, the Company completed an examination of certain of its German subsidiaries’ corporate income and trade tax returns for the tax years ended March 31, 2011 through 2014 and paid approximately $0.4 million upon conclusion of such examination. It appears reasonably possible that the amounts of unrecognized income tax benefits could change in the next twelve months upon conclusion of the Company’s current ongoing examinations; however, any potential payments of income tax, interest and penalties are not expected to be significant to the Company's consolidated financial statements. With certain exceptions, the Company is no longer subject to U.S. federal income tax examinations for tax years ending prior to March 31, 2015, state and local income tax examinations for years ending prior to fiscal 2014 or significant foreign income tax examinations for years ending prior to fiscal 2013. With respect to the Company's U.S. federal NOL carryforward (which was fully utilized for the tax year ended March 31, 2015), the short tax period from July 21, 2006 to March 31, 2007 (due to a prior change in control of the Company) and the tax years ended March 31, 2008 through March 31, 2013 are open under statutes of limitations; whereby, the Internal Revenue Service may not adjust the income tax liability for these years, but may reduce the NOL carryforward and any other tax attribute carryforwards to currently open tax years.

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Earnings per Share

9 Months Ended

Dec. 31, 2017

Earnings Per Share [Abstract]

Earnings per Share

Earnings per Share

The following table presents the basis for the basic and diluted income per share computations (in millions, except share amounts):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Basic net income per share:
Numerator:
Net income	$	81.6		$	3.2		$	137.9		$	46.7
Less: Dividends on preferred stock	(5.8		)	(1.5		)	(17.4		)	(1.5		)
Net income attributable to Rexnord common stockholders	$	75.8		$	1.7		$	120.5		$	45.2
Denominator:
Weighted-average common shares outstanding, basic	103,964			103,113			103,824			102,514
Net income per share attributable to Rexnord common stockholders - basic	$	0.73		$	0.02		$	1.16		$	0.44
Diluted net income per share:
Numerator:
Net income	$	81.6		$	3.2		$	137.9		$	46.7
Less: Dividends on preferred stock	—			(1.5		)	—			(1.5		)
Net income attributable to Rexnord common stockholders (1)	$	81.6		$	1.7		$	137.9		$	45.2
Denominator:
Weighted-average common shares outstanding, basic	103,964			103,113			103,824			102,514
Effect of dilutive equity awards	1,966			1,445			1,845			1,967
Preferred stock under the "if-converted" method (1)	16,087			—			16,694			—
Weighted-average common shares outstanding, diluted	122,017			104,558			122,363			104,481
Net income per share attributable to Rexnord common stockholders - dilutive	$	0.67		$	0.02		$	1.13		$	0.43

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(1) Following the issuance of the 5.75% Series A Mandatory Convertible Preferred Stock ("Series A Preferred Stock") in the third quarter of fiscal 2017, the Company’s diluted net income per share is computed using the “if-converted” method. The "if-converted" method is utilized only when such calculation is dilutive to earnings per share using the treasury stock method. Under the “if-converted” method, diluted net income per share is calculated under the assumption that the shares of Series A Preferred Stock have been converted into shares of the Company’s common stock as of the beginning of the respective period and therefore no dividends are provided to holders of the Series A Preferred Stock. During the three and nine months ended December 31, 2017, the computation of diluted net income per share was calculated utilizing the "if-converted" method. During the three and nine months ended December 31, 2016, the computation of diluted net income per share does not include shares of preferred stock that are convertible into a weighted average of 5.1 million million and 1.7 million shares of common stock, respectively, due to their anti-dilutive effects.  

The computation of diluted net income per share for the three and nine months endedDecember 31, 2017 excludes 2.8 million and 2.7 million shares, respectively, related to equity awards due to their anti-dilutive effects. The computation of diluted net income per share for the three and nine months endedDecember 31, 2016 excludes 5.5 million and 5.3 million shares, respectively, related to equity awards due to their anti-dilutive effects.

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Stockholders' Equity

9 Months Ended

Dec. 31, 2017

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Stockholders' Equity

Stockholders' equity consists of the following (in millions):

	Preferred Stock		Common Stock		Additional Paid-In Capital			Retained (Deficit) Earnings			Accumulated Other Comprehensive (Loss) Income			Total Stockholders’ Equity
Balance at March 31, 2017	$	0.0	$	1.0	$	1,262.1		$	(55.5	)	$	(137.0	)	$	1,070.6
Total comprehensive income	—		—		—			137.9			44.2			182.1
Stock-based compensation expense	—		—		15.9			—			—			15.9
Exercise of stock options	—		—		2.9			—			—			2.9
Preferred stock dividends	—		—		(10.8		)	(6.6		)	—			(17.4		)
Balance at December 31, 2017	$	0.0	$	1.0	$	1,270.1		$	75.8		$	(92.8	)	$	1,254.1

Preferred Stock

During the third quarter of fiscal 2017, the Company issued 8,050,000 depositary shares, each of which represents a 1/20th interest in a share of Series A Preferred Stock, for an offering price of $50 per depository share. The Company issued an aggregate of 402,500 shares of Series A Preferred Stock in connection therewith. Unless converted earlier, each share of Series A Preferred Stock will convert automatically on the mandatory conversion date, which is November 15, 2019, into between 39.702 and 47.642 shares of the Company’s common stock, subject to customary anti-dilution adjustments. The number of shares of common stock issuable upon conversion will be determined based on a defined average volume weighted average price per share of the Company’s common stock preceding November 15, 2019. Holders of the Series A Preferred Stock may elect on a voluntary basis to convert their shares into common stock at the minimum exchange ratio at any time prior to the mandatory conversion date.

Dividends accumulate from the issuance date. Rexnord may pay such dividends in cash or, subject to certain limitations, by delivery of shares of the Company's common stock or through any combination of cash and shares of the Company's common stock as determined by the Company in its sole discretion. Any unpaid dividends will continue to accumulate. Dividends are payable quarterly, ending on November 15, 2019. The shares of Series A Preferred Stock have a liquidation preference of $1,000 per share, plus accrued but unpaid dividends. With respect to dividend and liquidation rights, the Series A Preferred Stock ranks senior to the Company's common stock and junior to all existing and future indebtedness.

The net proceeds from the offering during the nine months ended December 31, 2016 were approximately $390.2 million. The Company used $195.0 million of the proceeds to prepay a portion of the then-outstanding term loan indebtedness under its credit agreement, with the remainder retained for general corporate purposes. During the three and nine months ended December 31, 2017, the Company paid $5.8 million and $17.4 million of dividends, respectively. As of December 31, 2017, there were no dividends in arrears on the Series A Preferred Stock.

Common Stock Repurchase Program

In fiscal 2015, the Company's Board of Directors approved a stock repurchase program (the "Repurchase Program") authorizing the repurchase of up to $200.0 million of the Company's common stock from time to time on the open market or in privately negotiated transactions. The Repurchase Program does not require the Company to acquire any particular amount of common stock and does not specify the timing of purchases or the prices to be paid; however, the program will continue until the maximum amount of dollars authorized have been expended or until it is modified or terminated by the Board. No shares were repurchased during the nine months endedDecember 31, 2017 or December 31, 2016. A total of approximately $160.0 million remained of the existing repurchase authority at December 31, 2017.

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Accumulated Other Comprehensive Loss

9 Months Ended

Dec. 31, 2017

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Loss

Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss, net of tax, for the nine months endedDecember 31, 2017 are as follows (in millions):

	Interest Rate Derivatives			Foreign Currency Translation			Pension and Postretirement Plans			Total
Balance at March 31, 2017	$	(9.5	)	$	(99.3	)	$	(28.2	)	$	(137.0	)
Other comprehensive income before reclassifications	—			41.6			—			41.6
Amounts reclassified from accumulated other comprehensive loss	3.6			—			(1.0		)	2.6
Net current period other comprehensive income (loss)	3.6			41.6			(1.0		)	44.2
Balance at December 31, 2017	$	(5.9	)	$	(57.7	)	$	(29.2	)	$	(92.8	)

The following table summarizes the amounts reclassified from accumulated other comprehensive loss to net income during the three and nine months endedDecember 31, 2017 and December 31, 2016 (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016			Income Statement Line
Pension and other postretirement plans
Amortization of prior service credit	$	(0.5	)	$	(0.5	)	$	(1.5	)	$	(1.4	)	Selling, general and administrative expenses
Provision for income taxes	0.1			0.2			0.5			0.5
Total net of tax	$	(0.4	)	$	(0.3	)	$	(1.0	)	$	(0.9	)
Interest rate derivatives
Net realized losses on interest rate hedges	$	1.8		$	2.7		$	7.2		$	7.9		Interest expense, net
Benefit for income taxes	(1.5		)	(1.0		)	(3.6		)	(3.0		)
Total net of tax	$	0.3		$	1.7		$	3.6		$	4.9

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Inventories

9 Months Ended

Dec. 31, 2017

Inventory, Net [Abstract]

Inventories

Inventories

The major classes of inventories are summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Finished goods	$	153.7	$	139.9
Work in progress	47.4		44.4
Purchased components	81.4		74.0
Raw materials	59.2		47.7
Inventories at First-in, First-Out ("FIFO") cost	341.7		306.0
Adjustment to state inventories at Last-in, First-Out ("LIFO") cost	8.2		8.9
	$	349.9	$	314.9

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Goodwill and Intangible Assets

9 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets

The changes in the net carrying value of goodwill for the nine months endedDecember 31, 2017 by operating segment are presented below (in millions):

	Process & Motion Control		Water Management		Consolidated
Net carrying amount as of March 31, 2017	$	1,068.8	$	249.4	$	1,318.2
Acquisitions (1)	—		25.8		25.8
Currency translation adjustment and other	3.0		6.8		9.8
Net carrying amount as of December 31, 2017	$	1,071.8	$	282.0	$	1,353.8

(1) Refer to footnote 2 for additional information regarding acquisitions.

The gross carrying amount and accumulated amortization for each major class of identifiable intangible assets as of December 31, 2017 and March 31, 2017 are as follows (in millions):

		December 31, 2017
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	47.5	$	(38.9	)	$	8.6
Customer relationships (including distribution network)	13 years	710.6		(498.3		)	212.3
Tradenames	12 years	37.1		(7.7		)	29.4
Intangible assets not subject to amortization - tradenames		317.6		—			317.6
Total intangible assets, net	13 years	$	1,112.8	$	(544.9	)	$	567.9
		March 31, 2017
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	47.0	$	(37.7	)	$	9.3
Customer relationships (including distribution network) (1)	13 years	685.8		(475.2		)	210.6
Tradenames (1)	12 years	29.5		(5.3		)	24.2
Intangible assets not subject to amortization - tradenames		314.5		—			314.5
Total intangible assets, net	13 years	$	1,076.8	$	(518.2	)	$	558.6

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(1) Tradenames and customer relationships acquired during fiscal 2018 were both assigned a useful life of 14 years.

Intangible asset amortization expense totaled $8.6 million and $24.8 million for the three and nine months endedDecember 31, 2017, respectively. Intangible asset amortization expense totaled $8.6 million and $33.7 million for the three and nine months endedDecember 31, 2016, respectively.

The Company expects to recognize amortization expense on the intangible assets subject to amortization of $33.4 million in fiscal year 2018 (inclusive of $24.8 million of amortization expense recognized in the nine months endedDecember 31, 2017), $34.3 million in fiscal year 2019, $34.1 million in fiscal year 2020, $32.6 million in fiscal year 2021 and $28.3 million in fiscal year 2022.

During the third quarter ended December 31, 2017, the Company completed its annual evaluation of indefinite lived intangible assets (tradenames) and goodwill for impairment in accordance with ASC 350, Intangibles - Goodwill and Other. The fair value of the Company's indefinite lived intangible assets and reporting units were primarily estimated using an income valuation model (discounted cash flow) and market approach (guideline public company comparables), which indicated that the fair value of the Company's indefinite lived intangible assets and reporting units exceeded their carrying value; therefore, no impairment was present.

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Other Current Liabilities

9 Months Ended

Dec. 31, 2017

Other Liabilities Disclosure [Abstract]

Other Current Liabilities

Other Current Liabilities

Other current liabilities are summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Customer advances	$	10.5	$	10.9
Sales rebates	30.2		25.5
Commissions	6.3		6.3
Restructuring and other similar charges (1)	3.7		12.0
Product warranty (2)	7.5		7.5
Risk management (3)	9.6		8.9
Legal and environmental	4.5		4.4
Taxes, other than income taxes	7.1		10.5
Income tax payable	19.2		17.8
Interest payable	2.3		5.7
Other	25.8		17.9
	$	126.7	$	127.4

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(1) See more information related to the restructuring obligations within Note 3, Restructuring and Other Similar Charges.

(2) See more information related to the product warranty obligations within Note 14, Commitments and Contingencies.

(3) Includes projected liabilities related to losses arising from automobile, general and product liability claims.

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Long-Term Debt

9 Months Ended

Dec. 31, 2017

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt

Long-term debt is summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Term loan (1)	$	791.2	$	1,584.5
4.875% Senior notes due 2025 (2)	494.1		—
Other subsidiary debt (3)	37.8		38.2
Total	1,323.1		1,622.7
Less current maturities	0.2		16.5
Long-term debt	$	1,322.9	$	1,606.2

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(1) Includes an unamortized original issue discount and debt issuance costs of $8.8 million and $17.9 million at December 31, 2017 and March 31, 2017, respectively.

(2) Includes an unamortized debt issuance costs of $5.9 million at December 31, 2017.

(3) Other subsidiary debt consists primarily of a $36.9 million loan payable associated with the New Market Tax Credit incentive program as of December 31, 2017 and March 31, 2017. The Company also invested an aggregate of $27.6 million in the form of a loan receivable. The aggregate loan receivable is presented within Other assets on the condensed consolidated balance sheets as of both December 31, 2017 and March 31, 2017. Also includes unamortized debt issuance costs of $0.5 million as of both December 31, 2017 and March 31, 2017.

Senior Secured Credit Facility

The Company’s Third Amended and Restated First Lien Credit Agreement (the “Credit Agreement”) is funded by a syndicate of banks and other financial institutions and provides for (i) a $800.0 million term loan facility and (ii) a $264.0 million revolving credit facility.

As of December 31, 2017, the Company was in compliance with all applicable covenants under the Credit Agreement, including compliance with a maximum permitted total net leverage ratio (the Company's sole financial maintenance covenant under the revolving credit facility discussed below) of 6.75 to 1.0. The Company's total net leverage ratio was 3.0 to 1.0 as of December 31, 2017.

Term Debt

On December 7, 2017, the Company entered into an Incremental Assumption Agreement (the “Amendment”) with Credit Suisse AG, Cayman Islands Branch, as administrative agent and the refinancing term lender, and the lenders party thereto, relating to the Credit Agreement. Prior to the Amendment, the Credit Agreement included a $1,606.4 million term loan facility (the “Prior Term Loan”).

The Amendment provided for a new term loan in the aggregate principal amount of $800.0 million (the “Term Refinancing Loan”). The proceeds of the Term Refinancing Loan were used, along with cash on hand and the net $500.0 million of proceeds from the Company’s issuance of the Notes (as defined below), to reduce the aggregate principal amount of the Prior Term Loan outstanding under the Credit Agreement to $800.0 million.

The Term Refinancing Loan has a maturity date of August 21, 2024 (extended from August 21, 2023 under the Prior Term Loan). The borrowings under the Term Refinancing Loan bear interest at either (i) London Interbank Offered Rate (“LIBOR”) (subject to a 0% floor) plus an applicable margin of 2.25% (which was reduced from 2.75%) or at an alternative base rate plus an applicable margin of 1.25% (which was reduced from 1.75%), or (ii.) if the borrowers have received a corporate rating equal to or higher than Ba3 (with at least a stable outlook) by Moody’s and BB- (with at least a stable outlook) by S&P, LIBOR (subject to a 0% floor) plus an applicable margin of 2.00% or an alternate base rate plus an applicable margin of 1.00%. At December 31, 2017, the borrowings under the Term Refinancing Loan had a weighted-average effective interest rate of 3.80%.

In accordance with ASC 470-50, Debt Modifications and Extinguishments (“ASC 470-50”), the Company recognized a $11.9 million loss on the debt extinguishment associated with the above transaction, which was comprised of $3.9 million of refinancing related costs, as well as a non-cash write-off of unamortized original issue discount and debt issuance costs associated with previously outstanding debt of $8.0 million. Additionally, the Company capitalized $0.8 million and $6.0 million of direct costs associated with the Term Refinancing Loan and Notes, respectively, which will be amortized over the life of the loans as interest expense using the effective interest method.

Revolving Debt Facility

The Credit Facility also includes a revolving credit facility, as noted above. Through the Amendment, the aggregate amount of the revolving credit facility commitments was reduced to $264.0 million (from $265.0 million) and the maturity date of the revolving facility under the Credit Agreement was extended from March 15, 2019, to March 15, 2023. The Company capitalized approximately $0.2 million of direct costs incurred in connection with the Amendment, which will be amortized over the remaining life of the revolving credit facility. The interest rate under the revolving credit facility remained unchanged. No amounts were borrowed under the revolving credit facility at December 31, 2017, or March 31, 2017; however $8.9 million and $14.6 million of the revolving credit facility was considered utilized in connection with outstanding letters of credit at December 31, 2017 and March 31, 2017, respectively.

4.875% Senior Notes due 2025

On December 7, 2017, the Company issued $500.0 million aggregate principal amount of 4.875% senior notes due 2025 (the “Notes”). The Notes were issued by RBS Global, Inc. and Rexnord LLC (collectively, the “Issuers”) and guaranteed by the Company and its domestic subsidiaries (subject to certain exceptions). The Notes were issued pursuant to an Indenture, dated as of December 7, 2017 (the “Indenture”), by and among the Issuers, the subsidiary guarantors named therein (the “Subsidiary Guarantors”) and Wells Fargo Bank, National Association (the “Trustee”). The Notes are general senior unsecured obligations of the Issuers, the Subsidiary Guarantors and the Company. The Company separately entered into a Parent Guarantee with the Trustee whereby it guaranteed certain obligations of the Issuers under the Indenture. The Notes pay interest semi-annually on June 15 and December 15, accruing upon issuance, at a rate of 4.875% per year with the first payment due on June 15, 2018. The Notes were not and will not be registered under the Securities Act of 1933 or any state securities laws.

The Issuers may redeem some or all of the Notes at any time or from time to time prior to December 15, 2020 at certain “make-whole” redemption prices (as set forth in the Indenture) and after December 15, 2020 at specified redemption prices (as set forth in the Indenture). Additionally, the Issuers may redeem up to 40% of the aggregate principal amount of the Notes at any time or from time to time prior to December 15, 2020 with the net proceeds of specified equity offerings at specified redemption prices (as set forth in the Indenture). Upon a change of control (as defined in the Indenture), the Issuers will be required to make an offer to purchase the Notes at a price equal to 101% of the principal amount of the Notes on the date of purchase plus accrued interest.

The Indenture contains customary covenants, such as restrictions on the Issuers and its restricted subsidiaries (but not on Rexnord Corporation) incurring or guaranteeing additional indebtedness or issuing certain preferred shares, paying dividends and making other restricted payments and creating or incurring certain liens. The Notes and Indenture do not contain any financial covenants. The Notes and Indenture contain customary events of default, including the failure to pay principal or interest when due, breach of covenants, cross-acceleration to other debt of the Issuers or restricted subsidiaries in excess of $50 million and bankruptcy events, all subject to terms, including notice and cure periods, as set forth in the Indenture.

Accounts Receivable Securitization Program

The Company maintains an accounts receivable securitization facility (the “Securitization”) with Wells Fargo Bank, N.A. Pursuant to the Securitization, Rexnord Funding (a wholly owned bankruptcy-remote special purpose subsidiary) has granted the lender under the Securitization a security interest in all of its current and future receivables and related assets in exchange for a credit facility permitting borrowings of up to a maximum aggregate amount of $100.0 million outstanding from time to time. Such borrowings will be used by Rexnord Funding to finance purchases of accounts receivable. The Securitization constitutes a “Permitted Receivables Financing” under Article 1 and Article 6 of the Credit Agreement. Any borrowings under the Securitization are accounted for as secured borrowings on the Company's condensed consolidated balance sheets.

As of both December 31, 2017 and March 31, 2017, the Company's available borrowing capacity under the Securitization was $100.0 million, based on the then-current accounts receivables. No amounts were borrowed under the Securitization at December 31, 2017 or March 31, 2017; however, $7.0 million and $4.6 million was considered utilized in connection with outstanding letters of credit at December 31, 2017 and March 31, 2017, respectively. As of December 31, 2017, the Company was in compliance with all applicable covenants and performance ratios contained in the Securitization.

See Note 11 to the audited consolidated financial statements of the Company's fiscal 2017 Annual Report on Form 10-K for further information regarding long-term debt.

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Derivative Financial Instruments

9 Months Ended

Dec. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

The Company is exposed to certain financial risks relating to fluctuations in foreign currency exchange rates and interest rates. The Company currently selectively uses foreign currency forward exchange contracts to manage its foreign currency risk and interest rate swaps and interest rate caps to manage its interest rate risk. All hedging transactions are authorized and executed pursuant to defined policies and procedures that prohibit the use of financial instruments for speculative purposes.

Foreign Exchange Contracts

The Company periodically enters into foreign currency forward contracts to mitigate the foreign currency volatility relative to certain intercompany and external cash flows expected to occur. These foreign currency forward contracts were not accounted for as cash flow hedges in accordance with ASC 815, Derivatives and Hedging (“ASC 815”), and as such were marked to market through earnings. The amounts recorded on the condensed consolidated balance sheets and recognized within the condensed consolidated statements of operations related to the Company's foreign currency forward contracts are set forth within the tables below.

Interest Rate Derivatives

The Company utilizes three interest rate swaps to hedge the variability in future cash flows associated with the Company's variable-rate term loans. The interest rate swaps, which originally became effective in fiscal 2016, convert $650.0 million of the Company’s variable-rate term loans to a weighted average fixed interest rate of 2.55% plus the applicable margin and will mature on September 27, 2018. In addition, the Company utilizes two interest rate caps to further mitigate the Company's exposure to increasing interest rates on its variable-rate interest loans. Those interest rate caps were effective beginning in fiscal 2015, with a maturity of October 24, 2018, and they cap the interest on $750.0 million of the Company's variable-rate interest loans at 3%, plus the applicable margin. In executing the interest rate caps, the Company paid a premium of $5.8 million. At inception, the interest rate swaps and interest rate caps were designated as cash flow hedges in accordance with ASC 815.

In connection with the Amendment to the Credit Agreement described in Note 11, the critical terms of the interest rate derivatives no longer matched the outstanding debt and no longer qualify as effective hedges. Upon discontinuation of hedge accounting, the unrealized losses associated with the interest rate derivatives remaining in accumulated other comprehensive loss is reclassified into interest expense on a straight-line basis over the remaining term of the interest rate derivatives. The fair values of the Company's interest rate derivatives are recorded on the condensed consolidated balance sheets; however, changes in fair values subsequent to the Amendment are recognized within the condensed consolidated statements of operations. See the amounts recorded on the condensed consolidated balance sheets related to the Company's interest rate derivatives within the tables below.

The Company's derivatives are measured at fair value in accordance with ASC 820, Fair Value Measurements and Disclosure (“ASC 820”). See Note 13 for more information as it relates to the fair value measurement of the Company's derivative financial instruments. The following tables indicate the location and the fair value of the Company's non-qualifying, non-designated derivative instruments within the condensed consolidated balance sheets (in millions):

	December 31, 2017		March 31, 2017		Balance Sheet Classification
	Asset Derivatives
Interest rate caps	$	—	$	0.0	Other assets
	Liability Derivatives
Interest rate swaps	$	3.6	$	—	Other current liabilities
Interest rate swaps	$	—	$	10.3	Other liabilities
Foreign currency forward contracts	$	0.0	$	0.1	Other current liabilities

The following table segregates the location and the amount of gains or losses associated with the changes in the fair value of the Company's derivative instruments, net of tax, within the condensed consolidated balance sheets (for instruments no longer qualifying for hedge accounting under ASC 815) and recognized within the condensed consolidated statements of operations (for non-qualifying, non-designated derivative instruments):

	Amount of loss recognized in accumulated other comprehensive loss
Derivative instruments no longer qualifying for hedge accounting under ASC 815 (in millions)
	December 31, 2017		March 31, 2017
Interest rate swaps	$	3.3	$	6.4
Interest rate caps	$	1.8	$	3.1

		Amount recognized as (income) expense
Non-qualifying, non-designated derivative instruments (in millions)	Condensed Consolidated Statements of Operations Classification	Three Months Ended					Nine Months Ended
		December 31, 2017			December 31, 2016		December 31, 2017			December 31, 2016
Foreign currency forward contracts	Other expense, net	$	(0.5	)	$	—	$	—		$	0.5
Interest rate swaps	Interest expense, net	$	(2.2	)	$	—	$	(2.2	)	$	—

The Company expects to reclassify approximately $8.2 million of losses related to its interest rate derivatives recorded within accumulated other comprehensive loss into earnings as interest expense during the next twelve months.

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Fair Value Measurements

9 Months Ended

Dec. 31, 2017

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. ASC 820 also specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed assumptions about the assumptions a market participant would use.

In accordance with ASC 820, fair value measurements are classified under the following hierarchy:

• Level 1- Quoted prices for identical instruments in active markets.

• Level 2- Quoted prices for similar instruments; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs or significant value-drivers are observable.

• Level 3- Model-derived valuations in which one or more inputs or value-drivers are both significant to the fair value measurement and unobservable.

If applicable, the Company uses quoted market prices in active markets to determine fair value, and therefore classifies such measurements within Level 1. In some cases where market prices are not available, the Company makes use of observable market-based inputs to calculate fair value, in which case the measurements are classified within Level 2. If quoted or observable market prices are not available, fair value is based upon internally developed models that use, where possible, current market-based parameters. These measurements are classified within Level 3 if they use significant unobservable inputs.

Fair Value of Derivative Instruments

The Company transacts in foreign currency forward contracts, interest rate swaps, and interest rate caps. The fair value of foreign currency forward contracts is based on a pricing model that utilizes the differential between the contract price and the market-based forward rate as applied to fixed future deliveries of currency at pre-designated settlement dates. The fair value of interest rate swaps and interest rate caps is based on pricing models. These models use discounted cash flows that utilize the appropriate market-based forward swap curves and interest rates.

The Company endeavors to utilize the best available information in measuring fair value. As required by ASC 820, financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Foreign currency forward contracts and interest rate derivatives reside within Level 2 of the fair value hierarchy. There were no transfers of assets or liabilities between levels for the periods presented. The following table provides a summary of the Company's assets and liabilities recognized at fair value on a recurring basis as of December 31, 2017 and March 31, 2017 (in millions):

	Fair Value as of December 31, 2017
	Level 1		Level 2		Level 3		Total
Liabilities:
Interest rate derivatives	$	—	$	3.6	$	—	$	3.6
Foreign currency forward contracts	—		0.0		—		—
Total liabilities at fair value	$	—	$	3.6	$	—	$	3.6

	Fair Value as of March 31, 2017
	Level 1		Level 2		Level 3		Total
Assets:
Interest rate caps	$	—	$	0.0	$	—	$	—
Total assets at fair value	$	—	$	—	$	—	$	—
Liabilities:
Interest rate swaps	$	—	$	10.3	$	—	$	10.3
Foreign currency forward contracts	—		0.1		—		0.1
Total liabilities at fair value	$	—	$	10.4	$	—	$	10.4

Fair Value of Non-Derivative Financial Instruments

The carrying amounts of cash, receivables, payables and accrued liabilities approximated fair value at December 31, 2017 and March 31, 2017 due to the short-term nature of those instruments. The fair value of long-term debt as of December 31, 2017 and March 31, 2017 was approximately $1,345.2 million and $1,644.6 million, respectively. The fair value is based on quoted market prices for the same issues.

Long-lived Assets and Intangible Assets

Long-lived assets (which includes property, plant and equipment and real estate) may be measured at fair value if such assets are held-for-sale or when there is a determination that the asset is impaired. Intangible assets (which include patents, tradenames, customer relationships, and non-compete agreements) also may be measured at fair value when there is a determination that the asset is impaired. The determination of fair value for these assets is based on the best information available that resides within Level 3 of the fair value hierarchy, including internal cash flow estimates discounted at an appropriate interest rate, quoted market prices when available, market prices for similar assets and independent appraisals, as appropriate. For real estate, cash flow estimates are based on current market estimates that reflect current and projected lease profiles and available industry information about expected trends in rental, occupancy and capitalization rates.

In connection with the ongoing supply chain optimization and footprint repositioning initiatives, the Company has taken several actions to consolidate existing manufacturing facilities and rationalize its product offerings. These actions require the Company to assess whether the carrying amount of impacted long-lived assets will be recoverable as well as whether the remaining useful lives require adjustment. During fiscal 2017 and 2018, the Company recognized both impairment charges and accelerated depreciation of certain assets to place the assets at net realizable value.  Net realizable value of these assets was determined using independent appraisals, classified as Level 3 inputs within the fair value hierarchy.  As of December 31, 2017 and March 31, 2017, these assets were recorded at net realizable value on the condensed consolidated balance sheets within property, plant and equipment in the amount of $6.3 million and $7.0 million, respectively.

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Commitments and Contingencies

9 Months Ended

Dec. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Warranties:

The Company offers warranties on the sales of certain products and records an accrual for estimated future claims. Such accruals are based upon historical experience and management's estimate of the level of future claims. The following table presents changes in the Company's product warranty liability (in millions):

	Nine Months Ended
	December 31, 2017			December 31, 2016
Balance at beginning of period	$	7.5		$	6.8
Acquired obligations	0.2			0.4
Charged to operations	3.2			2.9
Claims settled	(3.4		)	(2.9		)
Balance at end of period	$	7.5		$	7.2

Contingencies:

The Company's subsidiaries are involved in various unresolved legal actions, administrative proceedings and claims in the ordinary course of business involving, among other things, product liability, commercial, employment, workers' compensation, intellectual property claims and environmental matters. The Company establishes accruals in a manner that is consistent with accounting principles generally accepted in the United States for costs associated with such matters when liability is probable and those costs are capable of being reasonably estimated. Although it is not possible to predict with certainty the outcome of these unresolved legal actions or the range of possible loss or recovery, based upon current information, management believes the eventual outcome of these unresolved legal actions, either individually or in the aggregate, will not have a material adverse effect on the financial position, results of operations or cash flows of the Company.    

In connection with its sale of the Company, Invensys plc ("Invensys") provided the Company with indemnification against certain contingent liabilities, including certain pre-closing environmental liabilities. The Company believes that, pursuant to such indemnity obligations, Invensys is obligated to defend and indemnify the Company with respect to the matters described below relating to the Ellsworth Industrial Park Site and to various asbestos claims. The indemnity obligations relating to the matters described below are subject, together with indemnity obligations relating to other matters, to an overall dollar cap equal to the purchase price, which is an amount in excess of $900 million. The following paragraphs summarize the most significant actions and proceedings:

• In 2002, Rexnord Industries, LLC (“Rexnord Industries”) was named as a potentially responsible party (“PRP”), together with at least ten other companies, at the Ellsworth Industrial Park Site, Downers Grove, DuPage County, Illinois (the “Site”), by the United States Environmental Protection Agency (“USEPA”), and the Illinois Environmental Protection Agency (“IEPA”). Rexnord Industries' Downers Grove property is situated within the Ellsworth Industrial Complex. The USEPA and IEPA allege there have been one or more releases or threatened releases of chlorinated solvents and other hazardous substances, pollutants or contaminants, allegedly including but not limited to a release or threatened release on or from the Company's property, at the Site. The relief sought by the USEPA and IEPA includes further investigation and potential remediation of the Site and reimbursement of USEPA's past costs. Rexnord Industries' allocated share of past and future costs related to the Site, including for investigation and/or remediation, could be significant. All previously pending property damage and personal injury lawsuits against the Company related to the Site have been settled or dismissed. Pursuant to its indemnity obligation, Invensys continues to defend the Company in known matters related to the Site and has paid 100% of the costs to date.

• Multiple lawsuits (with approximately 300 claimants) are pending in state or federal court in numerous jurisdictions relating to alleged personal injuries due to the alleged presence of asbestos in certain brakes and clutches previously manufactured by the Company's Stearns division and/or its predecessor owners. Invensys and FMC, prior owners of the Stearns business, have paid 100% of the costs to date related to the Stearns lawsuits. Similarly, the Company's Prager subsidiary is a defendant in two multi-defendant lawsuits relating to alleged personal injuries due to the alleged presence of asbestos in a product allegedly manufactured by Prager. Additionally, there are numerous individuals who have filed asbestos related claims against Prager. These claims are currently on the Texas Multi-District Litigation inactive docket. The ultimate outcome of these asbestos matters cannot presently be determined. To date, the Company's insurance providers have paid 100% of the costs related to the Prager asbestos matters. The Company believes that the combination of its insurance coverage and the Invensys indemnity obligations will cover any future costs of these matters.

In connection with the Company's acquisition of The Falk Corporation (“Falk”), Hamilton Sundstrand provided the Company with indemnification against certain products-related asbestos exposure liabilities. The Company believes that, pursuant to such indemnity obligations, Hamilton Sundstrand is obligated to defend and indemnify the Company with respect to the asbestos claims described below, and that, with respect to these claims, such indemnity obligations are not subject to any time or dollar limitations.

The following paragraph summarizes the most significant actions and proceedings for which Hamilton Sundstrand has accepted responsibility:

• Falk, through its successor entity, is a defendant in multiple lawsuits pending in state or federal court in numerous jurisdictions relating to alleged personal injuries due to the alleged presence of asbestos in certain clutches and drives previously manufactured by Falk. There are approximately 100 claimants in these suits. The ultimate outcome of these lawsuits cannot presently be determined. Hamilton Sundstrand is defending the Company in these lawsuits pursuant to its indemnity obligations and has paid 100% of the costs to date.

Certain Water Management subsidiaries are also subject to asbestos litigation. As of December 31, 2017, Zurn and numerous other unrelated companies were defendants in approximately 6,000 asbestos related lawsuits representing approximately 16,000 claims. Plaintiffs' claims allege personal injuries caused by exposure to asbestos used primarily in industrial boilers formerly manufactured by a segment of Zurn. Zurn did not manufacture asbestos or asbestos components. Instead, Zurn purchased them from suppliers. These claims are being handled pursuant to a defense strategy funded by insurers.

As of December 31, 2017, the Company estimates the potential liability for the asbestos-related claims described above as well as the claims expected to be filed in the next ten years to be approximately $37.0 million, of which Zurn expects its insurance carriers to pay approximately $28.0 million in the next ten years on such claims, with the balance of the estimated liability being paid in subsequent years. The $37.0 million was developed based on actuarial studies and represents the projected indemnity payout for current and future claims. There are inherent uncertainties involved in estimating the number of future asbestos claims, future settlement costs, and the effectiveness of defense strategies and settlement initiatives. As a result, actual liability could differ from the estimate described herein and could be substantial. The liability for the asbestos-related claims is recorded in Other liabilities within the condensed consolidated balance sheets.

Management estimates that its available insurance to cover this potential asbestos liability as of December 31, 2017, is approximately $241.0 million, and believes that all current claims are covered by insurance. However, principally as a result of the past insolvency of certain of the Company's insurance carriers, certain coverage gaps will exist if and after the Company's other carriers have paid the first $165.0 million of aggregate liabilities.

As of December 31, 2017, the Company had a recorded receivable from its insurance carriers of $37.0 million, which corresponds to the amount of this potential asbestos liability that is covered by available insurance and is currently determined to be probable of recovery. However, there is no assurance that $241.0 million of insurance coverage will ultimately be available or that this asbestos liability will not ultimately exceed $241.0 million. Factors that could cause a decrease in the amount of available coverage include: changes in law governing the policies, potential disputes with the carriers regarding the scope of coverage, and insolvencies of one or more of the Company's carriers. The receivable for probable asbestos-related recoveries is recorded in Other assets within the condensed consolidated balance sheets.

Certain Company subsidiaries were named as defendants in a number of individual and class action lawsuits in various United States courts claiming damages due to the alleged failure or anticipated failure of Zurn brass fittings on the PEX plumbing systems in homes and other structures. In fiscal 2013, the Company reached a court-approved agreement to settle the liability underlying this litigation.  The settlement is designed to resolve, on a national basis, the Company's overall exposure for both known and unknown claims related to the alleged failure or anticipated failure of such fittings, subject to the right of eligible class members to opt-out of the settlement and pursue their claims independently.  The settlement utilizes a seven year claims fund, which is capped at $20.0 million, and is funded in installments over the seven year period based on claim activity and minimum funding criteria.  The settlement also covers class action plaintiffs' attorneys' fees and expenses. Historically, the Company's insurance carrier had funded the Company's defense in the above referenced proceedings. The Company, however, reached a settlement agreement with its insurer, whereby the insurer paid the Company a lump sum in exchange for a release of future exposure related to this liability. The Company has recorded an accrual related to this brass fittings liability, which takes into account, in pertinent part, the insurance carrier contribution, as well as exposure from the claims fund, opt-outs and the waiver of future insurance coverage.

Sale-Leaseback Transaction:

During the third quarter of fiscal 2018, the Company entered into a sale-leaseback arrangement for an owned facility in Downer's Grove, Illinois and received net proceeds from the transaction of $5.8 million. Due to the Company's continuing involvement with the construction of a new facility at the same location, the property did not qualify for sale accounting under the sale-leaseback accounting guidance during the construction period and as a result it has been accounted for as a financing transaction, with the $5.8 million of proceeds being classified in the condensed consolidated balance sheets in "Other current liabilities". The Company will depreciate the carrying value of the building over the expected remaining useful life. No gain or loss was recognized from the transaction.

As a result of the Company's anticipated involvement during the construction period of the new manufacturing facility the Company is considered, for accounting purposes only, the owner of the construction asset under build-to-suit lease accounting. Upon completion of construction, the Company will evaluate the de-recognition of the asset and liability under sale-leaseback accounting guidance.

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Retirement Benefits

9 Months Ended

Dec. 31, 2017

Retirement Benefits [Abstract]

Retirement Benefits

Retirement Benefits

The components of net periodic benefit cost are as follows (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Pension Benefits:
Service cost	$	0.2		$	0.5		$	0.6		$	1.4
Interest cost	6.1			6.4			18.3			19.0
Expected return on plan assets	(6.6		)	(6.8		)	(19.8		)	(20.0		)
Amortization:
Prior service cost	—			—			—			0.1
Net periodic benefit (credit) cost	$	(0.3	)	$	0.1		$	(0.9	)	$	0.5
Other Postretirement Benefits:
Interest cost	$	0.2		$	0.3		$	0.3		$	0.9
Amortization:
Prior service credit	(0.5		)	(0.5		)	(1.5		)	(1.5		)
Net periodic benefit credit	$	(0.3	)	$	(0.2	)	$	(1.2	)	$	(0.6	)

During the first nine months of fiscal 2018 and 2017, the Company made contributions of $2.9 million and $4.6 million, respectively, to its U.S. qualified pension plan trusts.

In accordance with the Company's accounting policy for defined benefit pension and other postretirement benefit plans, actuarial gains and losses above the corridor are immediately recognized in the Company's operating results. The corridor is 10% of the higher of the pension benefit obligation or the fair value of the plan assets. This adjustment is typically recorded annually in the fourth quarter in connection with the Company's required year-end re-measurement of plan assets and benefit obligations, or upon any off-cycle re-measurement event.

As of December 31, 2017, the Company merged three of its U.S. qualified defined benefit pension plans into a single plan, thereby also merging all of the pension plans’ assets. The merger of the three plans was a non-substantive change with no changes to the benefit formulas, vesting provisions, or to the employees covered by the plans.  Accordingly, the Company deemed an off-cycle remeasurement of the plan assets and benefit obligations was not required. 

See Note 16 to the audited consolidated financial statements of the Company's fiscal 2017 Annual Report on Form 10-K for further information regarding retirement benefits.

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Stock-Based Compensation

9 Months Ended

Dec. 31, 2017

Share-based Compensation [Abstract]

Stock-Based Compensation

Stock-Based Compensation

The Rexnord Corporation Performance Incentive Plan (the "Plan") is utilized to provide performance incentives to the Company's officers, employees, directors and certain others by permitting grants of equity awards (for common stock), as well as performance-based cash awards, to such persons to encourage them to maximize Rexnord's performance and create value for Rexnord's stockholders. ASC 718, Compensation-Stock Compensation (“ASC 718”), requires compensation costs related to share-based payment transactions to be recognized in the financial statements. Generally, compensation cost is measured based on the estimated grant-date fair value of the equity instruments issued. Compensation cost is recognized over the requisite service period, generally as the awards vest.

For the three and nine months endedDecember 31, 2017, the Company recognized $5.1 million and $15.9 million of stock-based compensation expense, respectively. For the three and nine months endedDecember 31, 2016, the Company recognized $3.8 million and $9.8 million of stock-based compensation expense, respectively. As of December 31, 2017, there was $29.4 million of total unrecognized compensation cost related to non-vested equity awards that is expected to be recognized over a weighted-average period of 1.8 years.

Stock Options

During the nine months endedDecember 31, 2017 and December 31, 2016, the Company granted stock options to executive officers and certain other employees, which vest over a weighted-average term of three years. The fair value of each option granted under the Plan during the nine months endedDecember 31, 2017 was estimated on the grant date using the Black-Scholes valuation model utilizing the following weighted-average assumptions:

	Nine Months Ended December 31, 2017
Expected option term (in years)	6.5
Expected volatility factor	31%
Weighted-average risk-free interest rate	1.99%
Expected dividend rate	0.0%

The Company estimates the expected term of stock options granted based on the midpoint between when the options vest and when they expire. The Company uses the simplified method to determine the expected term, as management does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term due to the limited period of time its common stock shares has been publicly traded. The Company’s expected volatility assumption is based on its historical volatility. The weighted-average risk-free interest rate is based on the U.S. Treasury yield curve in effect at the date of grant. Management assumes expected dividends of zero. The weighted-average grant date fair value of options granted under the Plan during the nine months endedDecember 31, 2017 was $8.11.

A summary of stock option activity during the first nine months of fiscal 2018 and 2017 is as follows:

	Nine Months Ended
	December 31, 2017				December 31, 2016
	Shares		Weighted Avg. Exercise Price		Shares		Weighted Avg. Exercise Price
Number of common shares under option:
Outstanding at beginning of period	7,770,670		$	18.73	7,854,685		$	15.10
Granted	1,175,702		23.17		2,599,538		19.72
Exercised	(246,372	)	13.44		(1,937,487	)	5.00
Canceled/Forfeited	(162,663	)	22.57		(451,536	)	23.52
Outstanding at end of period (1)	8,537,337		$	19.42	8,065,200		$	18.53
Exercisable at end of period (2)	5,081,221		$	17.79	3,370,968		$	14.74

______________________

(1) The weighted average remaining contractual life of options outstanding at December 31, 2017 is 6.3 years.

(2) The weighted average remaining contractual life of options exercisable at December 31, 2017 is 5.0 years.

Restricted Stock Units

During the nine months endedDecember 31, 2017 and 2016, the Company granted restricted stock units ("RSUs") to its non-employee directors and certain employees. RSUs granted during the nine months endedDecember 31, 2017 and 2016 generally vest ratably over three years. The fair value of each award is determined based on the Company's closing stock price on the date of grant. A summary of RSU activity during the nine months endedDecember 31, 2017 and 2016 is as follows:

	Nine Months Ended
	December 31, 2017				December 31, 2016
	Shares		Weighted Avg. Grant Date Fair Value		Shares		Weighted Avg. Grant Date Fair Value
Nonvested RSUs at beginning of period	322,142		$	20.59	125,307		$	24.67
Granted	248,199		23.16		276,943		19.51
Vested	(101,103	)	21.25		(42,144	)	24.63
Canceled/Forfeited	(30,729	)	22.48		(29,036	)	21.99
Nonvested RSUs at end of period	438,509		$	21.76	331,070		$	20.59

Performance Stock Units

The Company grants performance stock units (“PSUs”) to its executive officers and certain other employees. PSUs have a three-year performance period and are earned and vest, subject to continued employment, based in part on performance relative to metrics determined by the Compensation Committee. The number of PSUs earned, which can range between 0% and 200% of the target awards granted depending on the Company's actual performance during the three-year performance period, will be satisfied with Rexnord common stock. A summary of PSU activity during the nine months endedDecember 31, 2017 and 2016 is as follows:    

	Nine Months Ended
	December 31, 2017			December 31, 2016
	Shares	Weighted Avg. Grant Date Fair Value		Shares		Weighted Avg. Grant Date Fair Value
Nonvested PSUs at beginning of period	259,930	$	24.74	49,136		$	28.57
Granted	193,071	26.58		219,266		23.95
Vested	—	—		—		—
Canceled/Forfeited	—	—		(4,200	)	28.57
Nonvested PSUs at end of period	453,001	$	25.53	264,202		$	24.74

The fair value of the portion of PSUs with vesting based on free cash flow conversion is determined based on the Company's closing common stock price on the date of grant. The fair value of the portion of PSUs with vesting based on relative total shareholder return is determined utilizing the Monte Carlo simulation model and the weighted-average fair value of awards granted during the nine months endedDecember 31, 2017 was $31.25. Assumptions used to determine the fair value of each PSU were based on historical data and standard industry valuation practices and methodology. The following weighted-average assumptions were used for the PSUs granted during the nine months endedDecember 31, 2017:

	Nine Months Ended December 31, 2017
Expected volatility factor	31%
Weighted-average risk-free interest rate	1.45%
Expected dividend rate	0.0%

XML

Business Segment Information

9 Months Ended

Dec. 31, 2017

Segment Reporting [Abstract]

Business Segment Information

Business Segment Information

The Company's results of operations are reported in two business segments, consisting of the Process & Motion Control platform and the Water Management platform. The Process & Motion Control platform designs, manufactures, markets and services a comprehensive range of specified, highly-engineered mechanical components used within complex systems where customers' reliability requirements and costs of failure or downtime are high. The Process & Motion Control portfolio includes motion control products, shaft management products, aerospace components, and related value-added services. Products and services are marketed and sold globally under widely recognized brand names, including Rexnord, Rex, FlatTop, Falk, Link-Beltand Cambridge. Process & Motion Control products and services are sold into a diverse group of attractive end markets, including food and beverage, aerospace, mining, petrochemical, energy and power generation, cement and aggregates, forest and wood products, agriculture, and general industrial and automation applications. The Water Management platform designs, procures, manufactures, and markets products that provide and enhance water quality, safety, flow control and conservation. The Water Management product portfolio includes professional grade water control and safety, water distribution and drainage, finish plumbing, and site works products for primarily nonresidential buildings and flow control products for water and wastewater treatment infrastructure markets. Products are marketed and sold under widely recognized brand names, including Zurn, Wilkins, and VAG. The financial information of the Company's segments is regularly evaluated by the chief operating decision maker in determining resource allocation and assessing performance. Management evaluates the performance of each business segment based on its operating results. The same accounting policies are used throughout the organization (see Note 1).

Business Segment Information (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Net sales
Process & Motion Control	$	292.5		$	270.3		$	880.6		$	820.9
Water Management	199.8			181.5			610.2			593.7
Consolidated net sales	$	492.3		$	451.8		$	1,490.8		$	1,414.6
Income (loss) from operations
Process & Motion Control	$	48.5		$	28.6		$	132.9		$	91.3
Water Management	25.8			14.4			85.9			63.1
Corporate	(11.1		)	(10.2		)	(34.6		)	(30.5		)
Consolidated income from operations	$	63.2		$	32.8		$	184.2		$	123.9
Non-operating expense:
Interest expense, net	$	(18.7	)	$	(22.9	)	$	(58.9	)	$	(69.4	)
Loss on the extinguishment of debt	(11.9		)	(7.8		)	(11.9		)	(7.8		)
Other expense, net	(1.0		)	(0.7		)	(2.5		)	(3.3		)
Income before income taxes	31.6			1.4			110.9			43.4
Benefit for income taxes	(50.0		)	(1.8		)	(27.0		)	(3.3		)
Net income	81.6			3.2			137.9			46.7
Dividends on preferred stock	(5.8		)	(1.5		)	(17.4		)	(1.5		)
Net income attributable to Rexnord common stockholders	$	75.8		$	1.7		$	120.5		$	45.2
Depreciation and amortization
Process & Motion Control	$	13.0		$	17.0		$	40.4		$	51.8
Water Management	8.7			8.8			24.9			27.3
Consolidated	$	21.7		$	25.8		$	65.3		$	79.1
Capital expenditures
Process & Motion Control	$	7.6		$	12.0		$	20.8		$	32.9
Water Management	1.6			3.1			4.3			11.1
Consolidated	$	9.2		$	15.1		$	25.1		$	44.0

XML

Guarantor Subsidiaries

9 Months Ended

Dec. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Guarantor Subsidiaries

Guarantor Subsidiaries

The following schedules present condensed consolidating financial information of the Company as of December 31, 2017 and 2016 and for the three and nine month periods ended December 31, 2017 and 2016 for (a) Rexnord Corporation, the parent company (the "Parent") (b) RBS Global, Inc. and its wholly-owned subsidiary Rexnord LLC, which together are co-issuers (the “Issuers”) of the outstanding Notes; (c) on a combined basis, the domestic subsidiaries of the Company, all of which are wholly-owned by the Issuers (collectively, the “Guarantor Subsidiaries”) and guarantors of those Notes; and (d) on a combined basis, the foreign subsidiaries of the Company (collectively, the “Non-Guarantor Subsidiaries”). Separate financial statements of the Guarantor Subsidiaries are not presented because their guarantees of the senior notes and senior subordinated notes are full, unconditional and joint and several, and the Company believes separate financial statements and other disclosures regarding the Guarantor Subsidiaries are not material to investors.

Condensed Consolidating Balance Sheets

December 31, 2017

(in millions)

	Parent			Issuers		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	—		$	0.4	$	41.3		$	193.1	$	—		$	234.8
Receivables, net	—			—		176.7			136.4		—			313.1
Inventories, net	—			—		227.6			122.3		—			349.9
Other current assets	4.4			—		17.2			35.5		—			57.1
Total current assets	4.4			0.4		462.8			487.3		—			954.9
Property, plant and equipment, net	—			—		239.7			149.6		—			389.3
Intangible assets, net	—			—		450.1			117.8		—			567.9
Goodwill	—			—		1,022.8			331.0		—			1,353.8
Investment in:
Issuer subsidiaries	1,215.9			—		—			—		(1,215.9		)	—
Guarantor subsidiaries	—			3,098.4		—			—		(3,098.4		)	—
Non-guarantor subsidiaries	—			—		688.7			—		(688.7		)	—
Other assets	22.6			1.4		47.9			12.2		—			84.1
Total assets	$	1,242.9		$	3,100.2	$	2,912.0		$	1,097.9	$	(5,003.0	)	$	3,350.0
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt	$	—		$	—	$	0.2		$	—	$	—		$	0.2
Trade payables	—			0.7		120.1			78.8		—			199.6
Compensation and benefits	—			—		30.1			22.3		—			52.4
Current portion of pension and postretirement benefit obligations	—			—		2.5			1.9		—			4.4
Other current liabilities	—			5.8		74.8			46.1		—			126.7
Total current liabilities	—			6.5		227.7			149.1		—			383.3
Long-term debt	—			1,285.3		37.4			0.2		—			1,322.9
Note (receivable from) payable to affiliates, net	(11.5		)	588.3		(741.0		)	164.2		—			—
Pension and postretirement benefit obligations	—			—		118.5			52.4		—			170.9
Deferred income taxes	—			4.1		108.4			33.7		—			146.2
Other liabilities	0.3			0.1		62.6			9.6		—			72.6
Total liabilities	(11.2		)	1,884.3		(186.4		)	409.2		—			2,095.9
Total stockholders' equity	1,254.1			1,215.9		3,098.4			688.7		(5,003.0		)	1,254.1
Total liabilities and stockholders' equity	$	1,242.9		$	3,100.2	$	2,912.0		$	1,097.9	$	(5,003.0	)	$	3,350.0

Condensed Consolidating Balance Sheets

March 31, 2017

(in millions)

	Parent			Issuers		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	4.9		$	0.1	$	253.3		$	231.8	$	—		$	490.1
Receivables, net	—			—		191.3			131.6		—			322.9
Inventories, net	—			—		223.8			91.1		—			314.9
Other current assets	4.4			—		11.0			34.8		—			50.2
Total current assets	9.3			0.1		679.4			489.3		—			1,178.1
Property, plant and equipment, net	—			—		255.3			145.6		—			400.9
Intangible assets, net	—			—		441.9			116.7		—			558.6
Goodwill	—			—		996.8			321.4		—			1,318.2
Investment in:
Issuer subsidiaries	1,020.1			—		—			—		(1,020.1		)	—
Guarantor subsidiaries	—			2,835.2		—			—		(2,835.2		)	—
Non-guarantor subsidiaries	—			—		602.2			—		(602.2		)	—
Other assets	22.6			1.8		46.8			12.3		—			83.5
Total assets	$	1,052.0		$	2,837.1	$	3,022.4		$	1,085.3	$	(4,457.5	)	$	3,539.3
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt	$	—		$	16.1	$	0.4		$	—	$	—		$	16.5
Trade payables	—			—		120.3			77.5		—			197.8
Compensation and benefits	—			—		32.4			21.9		—			54.3
Current portion of pension and postretirement benefit obligations	—			—		2.4			1.9		—			4.3
Other current liabilities	—			5.7		76.4			45.3		—			127.4
Total current liabilities	—			21.8		231.9			146.6		—			400.3
Long-term debt	—			1,568.4		37.7			0.1		—			1,606.2
Note (receivable from) payable to affiliates, net	(18.7		)	215.5		(442.2		)	245.4		—			—
Pension and postretirement benefit obligations	—			—		124.6			49.8		—			174.4
Deferred income taxes	—			1.0		175.7			32.1		—			208.8
Other liabilities	0.1			10.3		59.5			9.1		—			79.0
Total liabilities	(18.6		)	1,817.0		187.2			483.1		—			2,468.7
Total stockholders' equity	1,070.6			1,020.1		2,835.2			602.2		(4,457.5		)	1,070.6
Total liabilities and stockholders' equity	$	1,052.0		$	2,837.1	$	3,022.4		$	1,085.3	$	(4,457.5	)	$	3,539.3

Condensed Consolidating Statements of Operations

For the Three Months Ended December 31, 2017

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	358.7		$	210.9		$	(77.3	)	$	492.3
Cost of sales	—		—			226.3			160.4			(77.3		)	309.4
Gross profit	—		—			132.4			50.5			—			182.9
Selling, general and administrative expenses	—		—			76.1			31.2			—			107.3
Restructuring and other similar charges	—		—			3.2			0.6			—			3.8
Amortization of intangible assets	—		—			7.0			1.6			—			8.6
Income from operations	—		—			46.1			17.1			—			63.2
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(18.7		)	0.1			(0.1		)	—			(18.7		)
To affiliates	0.7		6.7			(6.1		)	(1.3		)	—			—
Loss on extinguishment of debt	—		(11.9		)	—			—			—			(11.9		)
Other income (expense), net	—		(0.1		)	(2.5		)	1.6			—			(1.0		)
Income (loss) before income taxes from operations	0.7		(24.0		)	37.6			17.3			—			31.6
(Benefit) provision for income taxes	—		—			(55.4		)	5.4			—			(50.0		)
Income (loss) before equity in income of subsidiaries	0.7		(24.0		)	93.0			11.9			—			81.6
Equity in earnings of subsidiaries	80.9		104.9			11.9			—			(197.7		)	—
Net income	81.6		80.9			104.9			11.9			(197.7		)	81.6
Dividends on preferred stock	5.8		—			—			—			—			5.8
Net income attributable to Rexnord	$	75.8	$	80.9		$	104.9		$	11.9		$	(197.7	)	$	75.8
Comprehensive income	$	81.6	$	83.3		$	104.8		$	17.4		$	(197.7	)	$	89.4

Condensed Consolidating Statements of Operations

For the Nine Months Ended December 31, 2017

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	1,092.4		$	619.4		$	(221.0	)	$	1,490.8
Cost of sales	—		—			684.8			479.8			(221.0		)	943.6
Gross profit	—		—			407.6			139.6			—			547.2
Selling, general and administrative expenses	—		—			231.1			95.5			—			326.6
Restructuring and other similar charges	—		—			8.3			3.3			—			11.6
Amortization of intangible assets	—		—			20.0			4.8			—			24.8
Income from operations	—		—			148.2			36.0			—			184.2
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(59.3		)	0.4			—			—			(58.9		)
To affiliates	2.4		19.8			(18.2		)	(4.0		)	—			—
Loss on extinguishment of debt	—		(11.9		)	—			—			—			(11.9		)
Other expense, net	—		—			(4.7		)	2.2			—			(2.5		)
Income (loss) before income taxes from operations	2.4		(51.4		)	125.7			34.2			—			110.9
(Benefit) provision for income taxes	—		—			(41.6		)	14.6			—			(27.0		)
Income (loss) before equity in income of subsidiaries	2.4		(51.4		)	167.3			19.6			—			137.9
Equity in earnings of subsidiaries	135.5		186.9			19.6			—			(342.0		)	—
Net income	137.9		135.5			186.9			19.6			(342.0		)	137.9
Dividends on preferred stock	17.4		—			—			—			—			17.4
Net income attributable to Rexnord	$	120.5	$	135.5		$	186.9		$	19.6		$	(342.0	)	$	120.5
Comprehensive income	$	137.9	$	147.1		$	189.4		$	49.7		$	(342.0	)	$	182.1

Condensed Consolidating Statements of Operations

For the Three Months Ended December 31, 2016

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	331.4		$	176.4		$	(56.0	)	$	451.8
Cost of sales	—		—			217.9			136.9			(56.0		)	298.8
Gross profit	—		—			113.5			39.5			—			153.0
Selling, general and administrative expenses	—		—			70.5			29.4			—			99.9
Restructuring and other similar charges	—		—			10.9			0.8			—			11.7
Amortization of intangible assets	—		—			7.0			1.6			—			8.6
Income from operations	—		—			25.1			7.7			—			32.8
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(22.8		)	(0.1		)	—			—			(22.9		)
To affiliates	0.2		16.4			(13.7		)	(2.9		)	—			—
Loss on extinguishment of debt	—		(7.8		)	—			—			—			(7.8		)
Other expense, net	—		—			(0.3		)	(0.4		)	—			(0.7		)
Income (loss) before income taxes from operations	0.2		(14.2		)	11.0			4.4			—			1.4
(Benefit) provision for income taxes	—		—			(6.5		)	4.7			—			(1.8		)
Net income (loss) before equity in loss of subsidiaries	0.2		(14.2		)	17.5			(0.3		)	—			3.2
Equity in earnings (loss) of subsidiaries	3.0		17.2			(0.3		)	—			(19.9		)	—
Net income	3.2		3.0			17.2			(0.3		)	(19.9		)	3.2
Dividends on preferred stock	1.5		—			—			—			—			1.5
Net income attributable to Rexnord	$	1.7	$	3.0		$	17.2		$	(0.3	)	$	(19.9	)	$	1.7
Comprehensive income (loss)	$	3.2	$	0.3		$	5.5		$	(16.4	)	$	(19.9	)	$	(27.3	)

Condensed Consolidating Statements of Operations

For the Nine Months Ended December 31, 2016

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	1,043.6		$	545.5		$	(174.5	)	$	1,414.6
Cost of sales	—		—			682.5			414.2			(174.5		)	922.2
Gross profit	—		—			361.1			131.3			—			492.4
Selling, general and administrative expenses	—		—			224.0			89.1			—			313.1
Restructuring and other similar charges	—		—			18.5			3.2			—			21.7
Amortization of intangible assets	—		—			28.7			5.0			—			33.7
Income from operations	—		—			89.9			34.0			—			123.9
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(68.8		)	(0.5		)	(0.1		)	—			(69.4		)
To affiliates	0.2		58.4			(40.1		)	(18.5		)	—			—
Loss on extinguishment of debt	—		(7.8		)	—			—			—			(7.8		)
Other (expense) income, net	—		(0.5		)	(1.9		)	(0.9		)	—			(3.3		)
Income (loss) before income taxes from operations	0.2		(18.7		)	47.4			14.5			—			43.4
Provision (benefit) for income taxes	—		0.1			(14.2		)	10.8			—			(3.3		)
Income (loss) before equity in income of subsidiaries	0.2		(18.8		)	61.6			3.7			—			46.7
Equity in earnings of subsidiaries	46.5		65.3			3.7			—			(115.5		)	—
Net income	46.7		46.5			65.3			3.7			(115.5		)	46.7
Dividends on preferred stock	1.5		—			—			—			—			1.5
Net income attributable to Rexnord	$	45.2	$	46.5		$	65.3		$	3.7		$	(115.5	)	$	45.2
Comprehensive income (loss)	$	46.7	$	46.4		$	47.7		$	(7.3	)	$	(115.5	)	$	18.0

Condensed Consolidating Statements of Cash Flows

For the Nine Months Ended December 31, 2017

(in millions)

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Operating activities
Cash provided by (used for) operating activities	$	9.6		$	311.8		$	(154.8	)	$	(44.7	)	$	—	$	121.9
Investing activities
Expenditures for property, plant and equipment	—			—			(18.2		)	(6.9		)	—		(25.1		)
Acquisitions, net of cash	—			—			(50.0		)	—			—		(50.0		)
Proceeds from dispositions of property, plant and equipment	—			—			5.2			0.3			—		5.5
Cash used for investing activities	—			—			(63.0		)	(6.6		)	—		(69.6		)
Financing activities
Proceeds from borrowings of long-term debt	—			1,325.0			—			—			—		1,325.0
Repayments of long-term debt	—			(1,603.2		)	—			—			—		(1,603.2		)
Repayments of short-term debt	—			(24.3		)	—			—			—		(24.3		)
Payment of debt issuance costs	—			(9.0		)	—			—			—		(9.0		)
Proceeds from exercise of stock options	2.9			—			—			—			—		2.9
Proceeds from financing lease obligation	—			—			5.8			—			—		5.8
Payments of dividend on preferred stock	(17.4		)	—			—			—			—		(17.4		)
Cash (used for) provided by financing activities	(14.5		)	(311.5		)	5.8			—			—		(320.2		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			12.6			—		12.6
(Decrease) increase in cash and cash equivalents	(4.9		)	0.3			(212.0		)	(38.7		)	—		(255.3		)
Cash and cash equivalents at beginning of period	4.9			0.1			253.3			231.8			—		490.1
Cash and cash equivalents at end of period	$	—		$	0.4		$	41.3		$	193.1		$	—	$	234.8

Condensed Consolidating Statements of Cash Flows

For the Nine Months Ended December 31, 2016

(in millions)

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Operating activities
Net cash (used for) provided by operating activities	$	(404.9	)	$	304.7		$	161.2		$	61.1		$	—	$	122.1
Investing activities
Expenditures for property, plant and equipment	—			—			(35.1		)	(8.9		)	—		(44.0		)
Acquisitions, net of cash	—			—			(213.4		)	(0.3		)	—		(213.7		)
Proceeds from dispositions of property, plant and equipment	—			—			1.9			—			—		1.9
Cash used for investing activities	—			—			(246.6		)	(9.2		)	—		(255.8		)
Financing activities
Proceeds from borrowings of long-term debt	—			1,590.3			—			—			—		1,590.3
Repayments of long-term debt	—			(1,881.8		)	—			—			—		(1,881.8		)
Proceeds from borrowings of short-term debt	—			16.1			—			—			—		16.1
Repayments of short-term debt	—			(19.5		)	—			—			—		(19.5		)
Payment of debt issuance costs	—			(10.6		)	—			—			—		(10.6		)
Proceeds from issuance of preferred stock, net of direct offering costs	390.2			—			—			—			—		390.2
Proceeds from exercise of stock options	9.6			—			—			—			—		9.6
Deferred acquisition payment	—			—			—			(5.7		)	—		(5.7		)
Cash provided by (used for) financing activities	399.8			(305.5		)	—			(5.7		)	—		88.6
Effect of exchange rate changes on cash and cash equivalents	—			—			—			(10.2		)	—		(10.2		)
(Decrease) increase in cash and cash equivalents	(5.1		)	(0.8		)	(85.4		)	36.0			—		(55.3		)
Cash and cash equivalents at beginning of period	6.1			2.0			290.1			186.4			—		484.6
Cash and cash equivalents at end of period	$	1.0		$	1.2		$	204.7		$	222.4		$	—	$	429.3

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Basis of Presentation and Significant Accounting Policies (Policies)

9 Months Ended

Dec. 31, 2017

Accounting Policies [Abstract]

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In August 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2017-12, Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12"), which expands and refines hedge accounting for both non-financial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. ASU 2017-12 is effective for the beginning of the Company's fiscal 2020, with early adoption permitted, and must be applied prospectively. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.    

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment ("ASU 2017-04"). The amendments in ASU 2017-04 allow companies to apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. ASU 2017-04 is effective for the beginning of the Company's fiscal 2021, with early adoption permitted, and must be applied prospectively. The Company is currently evaluating the timing of adoption; however, it does not believe the adoption of ASU 2017-04 will have a material impact on the Company's consolidated financial statements.

In February 2015, the FASB issued ASU 2016-02, Leases (Topic 842) ("ASU 2016-02''), which requires lessees to recognize lease assets and lease liabilities for all leases on the balance sheets. ASU 2016-02 is effective beginning for the Company's fiscal 2020 and interim periods included therein on a modified retrospective basis. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.    

In July 2015, the FASB issued ASU No. 2015-11, Simplifying the Measurement of Inventory ("ASU 2015-11"). ASU 2015-11 requires inventory to be measured at the lower of cost and net realizable value, which is defined as the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. Under existing guidance, net realizable value is one of several calculations needed to measure inventory at lower of cost or market and as such, the new guidance reduces the complexity in measurement. The Company adopted ASU No. 2015-11 prospectively effective April 1, 2017 and there was no impact to the Company's condensed consolidated financial statements.

In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,which changes how employers that sponsor defined benefit pension or other postretirement benefit plans present the net periodic benefit cost in the income statement. The new guidance requires the service cost component of net periodic benefit cost to be presented in the same income statement line item(s) as other employee compensation costs arising from services rendered during the period with only the service cost component eligible for capitalization in assets. Other components of the net periodic benefit cost are to be stated separately from the line item(s) that includes the service cost and outside of operating income. The standard is required to be adopted for annual periods beginning after December 15, 2017, including interim periods within that annual period, which is the Company's fiscal year 2019. The amendment is to be applied retrospectively. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements upon adoption.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers ("ASU 2014-09"), now referred to as Accounting Standards Codification ("ASC") Topic 606 ("ASC 606"), in order to develop a common revenue standard for U.S. GAAP and International Financial Reporting Standards. The guidance specifies revenue should be recognized in an amount that reflects the consideration the company expects to be entitled to in exchange for the transfer of promised goods or services to customers. The guidance provides a five-step process that entities should follow in order to achieve that core principal. ASC 606 will be effective for the Company on April 1, 2018. Companies can use either a full retrospective or modified retrospective method to adopt the standard. Under the full retrospective method, the requirements of the new standard are applied to contracts for each prior reporting period presented and the cumulative effect of applying the standard is recognized in the earliest period presented. Under the modified retrospective method, prior periods are not updated to be presented on an accounting basis that is consistent with information for fiscal 2019. Rather, a cumulative adjustment for the effects of applying the new standard to periods prior to fiscal 2019 is recorded to retained earnings as of April 1, 2018. The Company expects to adopt the new standard using the modified retrospective approach.

The Company is assessing the impact of the new revenue standard on its consolidated financial statements by reviewing its current accounting policies and practices, including detailed reviews of customer contracts, to identify potential differences that would result from applying the requirements of the new standard to its revenue contracts. In addition, ASC 606 will require more comprehensive disclosures about revenue streams and contracts with customers. The Company is currently evaluating potential changes to its processes, information systems and internal controls related to the preparation of disclosures required under ASC 606. The Company will provide additional disclosure as its ongoing assessment progresses.

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Restructuring and Other Similar Charges (Tables)

9 Months Ended

Dec. 31, 2017

Restructuring and Related Activities [Abstract]

Schedule of Restructuring and Related Costs

The following table summarizes the Company's restructuring and other similar charges during the three and nine months endedDecember 31, 2017 and December 31, 2016 by operating segment (in millions):

	Restructuring and Other Similar Charges Three Months Ended December 31, 2017
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	0.6	$	0.6	$	1.2
Contract termination and other associated costs	2.4		0.2		2.6
Total restructuring and other similar charges	$	3.0	$	0.8	$	3.8

	Restructuring and Other Similar Charges Nine Months Ended December 31, 2017
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	2.5	$	3.3	$	5.8
Contract termination and other associated costs	5.2		0.6		5.8
Total restructuring and other similar charges	$	7.7	$	3.9	$	11.6

	Restructuring and Other Similar Charges Three Months Ended December 31, 2016
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	5.1	$	1.7	$	6.8
Asset impairment charges (1)	1.6		—		1.6
Contract termination and other associated costs	1.9		1.4		3.3
Total restructuring and other similar charges	$	8.6	$	3.1	$	11.7

	Restructuring and Other Similar Charges Nine Months Ended December 31, 2016
	Process & Motion Control		Water Management		Consolidated
Employee termination benefits	$	9.6	$	5.4	$	15.0
Asset impairment charges (1)	1.6		—		1.6
Contract termination and other associated costs	3.4		1.7		5.1
Total restructuring and other similar charges	$	14.6	$	7.1	$	21.7

____________________

(1) In connection with the ongoing supply chain optimization and footprint repositioning initiatives, the Company has taken several actions to consolidate existing manufacturing facilities and rationalize its product offerings. These actions require the Company to assess whether the carrying amount of impacted long-lived assets will be recoverable as well as whether the remaining useful lives require adjustment. The Company recognized impairment charges associated with these assets during the three and nine months ended of fiscal 2017, in the amount of $1.6 million. The impairment was determined utilizing independent appraisals of the assets, classified as Level 3 inputs within the Fair Value hierarchy. Refer to Note 13, Fair Value Measurements for additional information.

Summary of Activity in Restructuring Accrual

The following table summarizes the activity in the Company's restructuring accrual for the nine months endedDecember 31, 2017 (in millions):

	Employee termination benefits			Contract termination and other associated costs			Total
Restructuring accrual, March 31, 2017 (1)	$	11.0		$	1.0		$	12.0
Charges	5.8			5.8			11.6
Cash payments	(13.3		)	(6.6		)	(19.9		)
Restructuring accrual, December 31, 2017 (1)	$	3.5		$	0.2		$	3.7

____________________

(1)     The restructuring accrual is included in Other current liabilities in the condensed consolidated balance sheets.

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Earnings per Share (Tables)

9 Months Ended

Dec. 31, 2017

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table presents the basis for the basic and diluted income per share computations (in millions, except share amounts):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Basic net income per share:
Numerator:
Net income	$	81.6		$	3.2		$	137.9		$	46.7
Less: Dividends on preferred stock	(5.8		)	(1.5		)	(17.4		)	(1.5		)
Net income attributable to Rexnord common stockholders	$	75.8		$	1.7		$	120.5		$	45.2
Denominator:
Weighted-average common shares outstanding, basic	103,964			103,113			103,824			102,514
Net income per share attributable to Rexnord common stockholders - basic	$	0.73		$	0.02		$	1.16		$	0.44
Diluted net income per share:
Numerator:
Net income	$	81.6		$	3.2		$	137.9		$	46.7
Less: Dividends on preferred stock	—			(1.5		)	—			(1.5		)
Net income attributable to Rexnord common stockholders (1)	$	81.6		$	1.7		$	137.9		$	45.2
Denominator:
Weighted-average common shares outstanding, basic	103,964			103,113			103,824			102,514
Effect of dilutive equity awards	1,966			1,445			1,845			1,967
Preferred stock under the "if-converted" method (1)	16,087			—			16,694			—
Weighted-average common shares outstanding, diluted	122,017			104,558			122,363			104,481
Net income per share attributable to Rexnord common stockholders - dilutive	$	0.67		$	0.02		$	1.13		$	0.43

____________________

(1) Following the issuance of the 5.75% Series A Mandatory Convertible Preferred Stock ("Series A Preferred Stock") in the third quarter of fiscal 2017, the Company’s diluted net income per share is computed using the “if-converted” method. The "if-converted" method is utilized only when such calculation is dilutive to earnings per share using the treasury stock method. Under the “if-converted” method, diluted net income per share is calculated under the assumption that the shares of Series A Preferred Stock have been converted into shares of the Company’s common stock as of the beginning of the respective period and therefore no dividends are provided to holders of the Series A Preferred Stock. During the three and nine months ended December 31, 2017, the computation of diluted net income per share was calculated utilizing the "if-converted" method. During the three and nine months ended December 31, 2016, the computation of diluted net income per share does not include shares of preferred stock that are convertible into a weighted average of 5.1 million million and 1.7 million shares of common stock, respectively, due to their anti-dilutive effects.

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Stockholders' Equity (Tables)

9 Months Ended

Dec. 31, 2017

Stockholders' Equity Note [Abstract]

Schedule of Stockholders' Equity

Stockholders' equity consists of the following (in millions):

	Preferred Stock		Common Stock		Additional Paid-In Capital			Retained (Deficit) Earnings			Accumulated Other Comprehensive (Loss) Income			Total Stockholders’ Equity
Balance at March 31, 2017	$	0.0	$	1.0	$	1,262.1		$	(55.5	)	$	(137.0	)	$	1,070.6
Total comprehensive income	—		—		—			137.9			44.2			182.1
Stock-based compensation expense	—		—		15.9			—			—			15.9
Exercise of stock options	—		—		2.9			—			—			2.9
Preferred stock dividends	—		—		(10.8		)	(6.6		)	—			(17.4		)
Balance at December 31, 2017	$	0.0	$	1.0	$	1,270.1		$	75.8		$	(92.8	)	$	1,254.1

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Accumulated Other Comprehensive Loss (Tables)

9 Months Ended

Dec. 31, 2017

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss, net of tax, for the nine months endedDecember 31, 2017 are as follows (in millions):

	Interest Rate Derivatives			Foreign Currency Translation			Pension and Postretirement Plans			Total
Balance at March 31, 2017	$	(9.5	)	$	(99.3	)	$	(28.2	)	$	(137.0	)
Other comprehensive income before reclassifications	—			41.6			—			41.6
Amounts reclassified from accumulated other comprehensive loss	3.6			—			(1.0		)	2.6
Net current period other comprehensive income (loss)	3.6			41.6			(1.0		)	44.2
Balance at December 31, 2017	$	(5.9	)	$	(57.7	)	$	(29.2	)	$	(92.8	)

Reclassification out of Accumulated Other Comprehensive Loss

The following table summarizes the amounts reclassified from accumulated other comprehensive loss to net income during the three and nine months endedDecember 31, 2017 and December 31, 2016 (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016			Income Statement Line
Pension and other postretirement plans
Amortization of prior service credit	$	(0.5	)	$	(0.5	)	$	(1.5	)	$	(1.4	)	Selling, general and administrative expenses
Provision for income taxes	0.1			0.2			0.5			0.5
Total net of tax	$	(0.4	)	$	(0.3	)	$	(1.0	)	$	(0.9	)
Interest rate derivatives
Net realized losses on interest rate hedges	$	1.8		$	2.7		$	7.2		$	7.9		Interest expense, net
Benefit for income taxes	(1.5		)	(1.0		)	(3.6		)	(3.0		)
Total net of tax	$	0.3		$	1.7		$	3.6		$	4.9

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Inventories (Tables)

9 Months Ended

Dec. 31, 2017

Inventory, Net [Abstract]

Summary of Major Classes of Inventories

The major classes of inventories are summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Finished goods	$	153.7	$	139.9
Work in progress	47.4		44.4
Purchased components	81.4		74.0
Raw materials	59.2		47.7
Inventories at First-in, First-Out ("FIFO") cost	341.7		306.0
Adjustment to state inventories at Last-in, First-Out ("LIFO") cost	8.2		8.9
	$	349.9	$	314.9

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Goodwill and Intangible Assets (Tables)

9 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets and Goodwill

The changes in the net carrying value of goodwill for the nine months endedDecember 31, 2017 by operating segment are presented below (in millions):

	Process & Motion Control		Water Management		Consolidated
Net carrying amount as of March 31, 2017	$	1,068.8	$	249.4	$	1,318.2
Acquisitions (1)	—		25.8		25.8
Currency translation adjustment and other	3.0		6.8		9.8
Net carrying amount as of December 31, 2017	$	1,071.8	$	282.0	$	1,353.8

(1) Refer to footnote 2 for additional information regarding acquisitions.

Schedule of Gross Carrying Amount and Accumulated Amortization for Finite-Lived Intangible Assets

The gross carrying amount and accumulated amortization for each major class of identifiable intangible assets as of December 31, 2017 and March 31, 2017 are as follows (in millions):

		December 31, 2017
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	47.5	$	(38.9	)	$	8.6
Customer relationships (including distribution network)	13 years	710.6		(498.3		)	212.3
Tradenames	12 years	37.1		(7.7		)	29.4
Intangible assets not subject to amortization - tradenames		317.6		—			317.6
Total intangible assets, net	13 years	$	1,112.8	$	(544.9	)	$	567.9
		March 31, 2017
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	47.0	$	(37.7	)	$	9.3
Customer relationships (including distribution network) (1)	13 years	685.8		(475.2		)	210.6
Tradenames (1)	12 years	29.5		(5.3		)	24.2
Intangible assets not subject to amortization - tradenames		314.5		—			314.5
Total intangible assets, net	13 years	$	1,076.8	$	(518.2	)	$	558.6

____________________

(1) Tradenames and customer relationships acquired during fiscal 2018 were both assigned a useful life of 14 years.

Schedule of Gross Carrying Amount and Accumulated Amortization for Infinite-Lived Intangible Assets

The gross carrying amount and accumulated amortization for each major class of identifiable intangible assets as of December 31, 2017 and March 31, 2017 are as follows (in millions):

		December 31, 2017
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	47.5	$	(38.9	)	$	8.6
Customer relationships (including distribution network)	13 years	710.6		(498.3		)	212.3
Tradenames	12 years	37.1		(7.7		)	29.4
Intangible assets not subject to amortization - tradenames		317.6		—			317.6
Total intangible assets, net	13 years	$	1,112.8	$	(544.9	)	$	567.9
		March 31, 2017
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Patents	10 years	$	47.0	$	(37.7	)	$	9.3
Customer relationships (including distribution network) (1)	13 years	685.8		(475.2		)	210.6
Tradenames (1)	12 years	29.5		(5.3		)	24.2
Intangible assets not subject to amortization - tradenames		314.5		—			314.5
Total intangible assets, net	13 years	$	1,076.8	$	(518.2	)	$	558.6

____________________

(1) Tradenames and customer relationships acquired during fiscal 2018 were both assigned a useful life of 14 years.

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Other Current Liabilities (Tables)

9 Months Ended

Dec. 31, 2017

Other Liabilities Disclosure [Abstract]

Schedule of Other Current Liabilities

Other current liabilities are summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Customer advances	$	10.5	$	10.9
Sales rebates	30.2		25.5
Commissions	6.3		6.3
Restructuring and other similar charges (1)	3.7		12.0
Product warranty (2)	7.5		7.5
Risk management (3)	9.6		8.9
Legal and environmental	4.5		4.4
Taxes, other than income taxes	7.1		10.5
Income tax payable	19.2		17.8
Interest payable	2.3		5.7
Other	25.8		17.9
	$	126.7	$	127.4

____________________

(1) See more information related to the restructuring obligations within Note 3, Restructuring and Other Similar Charges.

(2) See more information related to the product warranty obligations within Note 14, Commitments and Contingencies.

(3) Includes projected liabilities related to losses arising from automobile, general and product liability claims.

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Long-Term Debt (Tables)

9 Months Ended

Dec. 31, 2017

Debt Disclosure [Abstract]

Schedule of Long-term Debt

Long-term debt is summarized as follows (in millions):

	December 31, 2017		March 31, 2017
Term loan (1)	$	791.2	$	1,584.5
4.875% Senior notes due 2025 (2)	494.1		—
Other subsidiary debt (3)	37.8		38.2
Total	1,323.1		1,622.7
Less current maturities	0.2		16.5
Long-term debt	$	1,322.9	$	1,606.2

____________________

(1) Includes an unamortized original issue discount and debt issuance costs of $8.8 million and $17.9 million at December 31, 2017 and March 31, 2017, respectively.

(2) Includes an unamortized debt issuance costs of $5.9 million at December 31, 2017.

(3) Other subsidiary debt consists primarily of a $36.9 million loan payable associated with the New Market Tax Credit incentive program as of December 31, 2017 and March 31, 2017. The Company also invested an aggregate of $27.6 million in the form of a loan receivable. The aggregate loan receivable is presented within Other assets on the condensed consolidated balance sheets as of both December 31, 2017 and March 31, 2017. Also includes unamortized debt issuance costs of $0.5 million as of both December 31, 2017 and March 31, 2017.

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Derivative Financial Instruments (Tables)

9 Months Ended

Dec. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Value Schedule of Derivatives

The following tables indicate the location and the fair value of the Company's non-qualifying, non-designated derivative instruments within the condensed consolidated balance sheets (in millions):

	December 31, 2017		March 31, 2017		Balance Sheet Classification
	Asset Derivatives
Interest rate caps	$	—	$	0.0	Other assets
	Liability Derivatives
Interest rate swaps	$	3.6	$	—	Other current liabilities
Interest rate swaps	$	—	$	10.3	Other liabilities
Foreign currency forward contracts	$	0.0	$	0.1	Other current liabilities

Schedules of Gains and Losses Associated with Derivative Instruments

The following table segregates the location and the amount of gains or losses associated with the changes in the fair value of the Company's derivative instruments, net of tax, within the condensed consolidated balance sheets (for instruments no longer qualifying for hedge accounting under ASC 815) and recognized within the condensed consolidated statements of operations (for non-qualifying, non-designated derivative instruments):

	Amount of loss recognized in accumulated other comprehensive loss
Derivative instruments no longer qualifying for hedge accounting under ASC 815 (in millions)
	December 31, 2017		March 31, 2017
Interest rate swaps	$	3.3	$	6.4
Interest rate caps	$	1.8	$	3.1

Schedule of Other Derivatives Not Designated as Hedging Instruments

		Amount recognized as (income) expense
Non-qualifying, non-designated derivative instruments (in millions)	Condensed Consolidated Statements of Operations Classification	Three Months Ended					Nine Months Ended
		December 31, 2017			December 31, 2016		December 31, 2017			December 31, 2016
Foreign currency forward contracts	Other expense, net	$	(0.5	)	$	—	$	—		$	0.5
Interest rate swaps	Interest expense, net	$	(2.2	)	$	—	$	(2.2	)	$	—

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Fair Value Measurements (Tables)

9 Months Ended

Dec. 31, 2017

Fair Value Disclosures [Abstract]

Summary of Assets Recognized at Fair Value on a Recurring Basis

The following table provides a summary of the Company's assets and liabilities recognized at fair value on a recurring basis as of December 31, 2017 and March 31, 2017 (in millions):

	Fair Value as of December 31, 2017
	Level 1		Level 2		Level 3		Total
Liabilities:
Interest rate derivatives	$	—	$	3.6	$	—	$	3.6
Foreign currency forward contracts	—		0.0		—		—
Total liabilities at fair value	$	—	$	3.6	$	—	$	3.6

	Fair Value as of March 31, 2017
	Level 1		Level 2		Level 3		Total
Assets:
Interest rate caps	$	—	$	0.0	$	—	$	—
Total assets at fair value	$	—	$	—	$	—	$	—
Liabilities:
Interest rate swaps	$	—	$	10.3	$	—	$	10.3
Foreign currency forward contracts	—		0.1		—		0.1
Total liabilities at fair value	$	—	$	10.4	$	—	$	10.4

Summary of Liabilities Recognized at Fair Value on a Recurring Basis

The following table provides a summary of the Company's assets and liabilities recognized at fair value on a recurring basis as of December 31, 2017 and March 31, 2017 (in millions):

	Fair Value as of December 31, 2017
	Level 1		Level 2		Level 3		Total
Liabilities:
Interest rate derivatives	$	—	$	3.6	$	—	$	3.6
Foreign currency forward contracts	—		0.0		—		—
Total liabilities at fair value	$	—	$	3.6	$	—	$	3.6

	Fair Value as of March 31, 2017
	Level 1		Level 2		Level 3		Total
Assets:
Interest rate caps	$	—	$	0.0	$	—	$	—
Total assets at fair value	$	—	$	—	$	—	$	—
Liabilities:
Interest rate swaps	$	—	$	10.3	$	—	$	10.3
Foreign currency forward contracts	—		0.1		—		0.1
Total liabilities at fair value	$	—	$	10.4	$	—	$	10.4

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Commitments and Contingencies (Tables)

9 Months Ended

Dec. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Schedule of Product Warranty Liability

The following table presents changes in the Company's product warranty liability (in millions):

	Nine Months Ended
	December 31, 2017			December 31, 2016
Balance at beginning of period	$	7.5		$	6.8
Acquired obligations	0.2			0.4
Charged to operations	3.2			2.9
Claims settled	(3.4		)	(2.9		)
Balance at end of period	$	7.5		$	7.2

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Retirement Benefits (Tables)

9 Months Ended

Dec. 31, 2017

Retirement Benefits [Abstract]

Schedule of Net Benefit Costs

The components of net periodic benefit cost are as follows (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Pension Benefits:
Service cost	$	0.2		$	0.5		$	0.6		$	1.4
Interest cost	6.1			6.4			18.3			19.0
Expected return on plan assets	(6.6		)	(6.8		)	(19.8		)	(20.0		)
Amortization:
Prior service cost	—			—			—			0.1
Net periodic benefit (credit) cost	$	(0.3	)	$	0.1		$	(0.9	)	$	0.5
Other Postretirement Benefits:
Interest cost	$	0.2		$	0.3		$	0.3		$	0.9
Amortization:
Prior service credit	(0.5		)	(0.5		)	(1.5		)	(1.5		)
Net periodic benefit credit	$	(0.3	)	$	(0.2	)	$	(1.2	)	$	(0.6	)

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Stock-Based Compensation (Tables)

9 Months Ended

Dec. 31, 2017

Share-based Compensation [Abstract]

Schedule of Share-based Compensation Arrangements

The fair value of each option granted under the Plan during the nine months endedDecember 31, 2017 was estimated on the grant date using the Black-Scholes valuation model utilizing the following weighted-average assumptions:

	Nine Months Ended December 31, 2017
Expected option term (in years)	6.5
Expected volatility factor	31%
Weighted-average risk-free interest rate	1.99%
Expected dividend rate	0.0%

Schedule of Stock Option Activity

A summary of stock option activity during the first nine months of fiscal 2018 and 2017 is as follows:

	Nine Months Ended
	December 31, 2017				December 31, 2016
	Shares		Weighted Avg. Exercise Price		Shares		Weighted Avg. Exercise Price
Number of common shares under option:
Outstanding at beginning of period	7,770,670		$	18.73	7,854,685		$	15.10
Granted	1,175,702		23.17		2,599,538		19.72
Exercised	(246,372	)	13.44		(1,937,487	)	5.00
Canceled/Forfeited	(162,663	)	22.57		(451,536	)	23.52
Outstanding at end of period (1)	8,537,337		$	19.42	8,065,200		$	18.53
Exercisable at end of period (2)	5,081,221		$	17.79	3,370,968		$	14.74

______________________

(1) The weighted average remaining contractual life of options outstanding at December 31, 2017 is 6.3 years.

(2) The weighted average remaining contractual life of options exercisable at December 31, 2017 is 5.0 years.

Schedule of Nonvested Restricted Stock Units Activity

A summary of RSU activity during the nine months endedDecember 31, 2017 and 2016 is as follows:

	Nine Months Ended
	December 31, 2017				December 31, 2016
	Shares		Weighted Avg. Grant Date Fair Value		Shares		Weighted Avg. Grant Date Fair Value
Nonvested RSUs at beginning of period	322,142		$	20.59	125,307		$	24.67
Granted	248,199		23.16		276,943		19.51
Vested	(101,103	)	21.25		(42,144	)	24.63
Canceled/Forfeited	(30,729	)	22.48		(29,036	)	21.99
Nonvested RSUs at end of period	438,509		$	21.76	331,070		$	20.59

Schedule of Nonvested Performance-based Units Activity

A summary of PSU activity during the nine months endedDecember 31, 2017 and 2016 is as follows:    

	Nine Months Ended
	December 31, 2017			December 31, 2016
	Shares	Weighted Avg. Grant Date Fair Value		Shares		Weighted Avg. Grant Date Fair Value
Nonvested PSUs at beginning of period	259,930	$	24.74	49,136		$	28.57
Granted	193,071	26.58		219,266		23.95
Vested	—	—		—		—
Canceled/Forfeited	—	—		(4,200	)	28.57
Nonvested PSUs at end of period	453,001	$	25.53	264,202		$	24.74

Schedule of Weighted-Average Assumptions Used, Performance-based Units

The following weighted-average assumptions were used for the PSUs granted during the nine months endedDecember 31, 2017:

	Nine Months Ended December 31, 2017
Expected volatility factor	31%
Weighted-average risk-free interest rate	1.45%
Expected dividend rate	0.0%

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Business Segment Information (Tables)

9 Months Ended

Dec. 31, 2017

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

Business Segment Information (in millions):

	Three Months Ended						Nine Months Ended
	December 31, 2017			December 31, 2016			December 31, 2017			December 31, 2016
Net sales
Process & Motion Control	$	292.5		$	270.3		$	880.6		$	820.9
Water Management	199.8			181.5			610.2			593.7
Consolidated net sales	$	492.3		$	451.8		$	1,490.8		$	1,414.6
Income (loss) from operations
Process & Motion Control	$	48.5		$	28.6		$	132.9		$	91.3
Water Management	25.8			14.4			85.9			63.1
Corporate	(11.1		)	(10.2		)	(34.6		)	(30.5		)
Consolidated income from operations	$	63.2		$	32.8		$	184.2		$	123.9
Non-operating expense:
Interest expense, net	$	(18.7	)	$	(22.9	)	$	(58.9	)	$	(69.4	)
Loss on the extinguishment of debt	(11.9		)	(7.8		)	(11.9		)	(7.8		)
Other expense, net	(1.0		)	(0.7		)	(2.5		)	(3.3		)
Income before income taxes	31.6			1.4			110.9			43.4
Benefit for income taxes	(50.0		)	(1.8		)	(27.0		)	(3.3		)
Net income	81.6			3.2			137.9			46.7
Dividends on preferred stock	(5.8		)	(1.5		)	(17.4		)	(1.5		)
Net income attributable to Rexnord common stockholders	$	75.8		$	1.7		$	120.5		$	45.2
Depreciation and amortization
Process & Motion Control	$	13.0		$	17.0		$	40.4		$	51.8
Water Management	8.7			8.8			24.9			27.3
Consolidated	$	21.7		$	25.8		$	65.3		$	79.1
Capital expenditures
Process & Motion Control	$	7.6		$	12.0		$	20.8		$	32.9
Water Management	1.6			3.1			4.3			11.1
Consolidated	$	9.2		$	15.1		$	25.1		$	44.0

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Guarantor Subsidiaries (Tables)

9 Months Ended

Dec. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Condensed Consolidating Balance Sheets

Condensed Consolidating Balance Sheets

December 31, 2017

(in millions)

	Parent			Issuers		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	—		$	0.4	$	41.3		$	193.1	$	—		$	234.8
Receivables, net	—			—		176.7			136.4		—			313.1
Inventories, net	—			—		227.6			122.3		—			349.9
Other current assets	4.4			—		17.2			35.5		—			57.1
Total current assets	4.4			0.4		462.8			487.3		—			954.9
Property, plant and equipment, net	—			—		239.7			149.6		—			389.3
Intangible assets, net	—			—		450.1			117.8		—			567.9
Goodwill	—			—		1,022.8			331.0		—			1,353.8
Investment in:
Issuer subsidiaries	1,215.9			—		—			—		(1,215.9		)	—
Guarantor subsidiaries	—			3,098.4		—			—		(3,098.4		)	—
Non-guarantor subsidiaries	—			—		688.7			—		(688.7		)	—
Other assets	22.6			1.4		47.9			12.2		—			84.1
Total assets	$	1,242.9		$	3,100.2	$	2,912.0		$	1,097.9	$	(5,003.0	)	$	3,350.0
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt	$	—		$	—	$	0.2		$	—	$	—		$	0.2
Trade payables	—			0.7		120.1			78.8		—			199.6
Compensation and benefits	—			—		30.1			22.3		—			52.4
Current portion of pension and postretirement benefit obligations	—			—		2.5			1.9		—			4.4
Other current liabilities	—			5.8		74.8			46.1		—			126.7
Total current liabilities	—			6.5		227.7			149.1		—			383.3
Long-term debt	—			1,285.3		37.4			0.2		—			1,322.9
Note (receivable from) payable to affiliates, net	(11.5		)	588.3		(741.0		)	164.2		—			—
Pension and postretirement benefit obligations	—			—		118.5			52.4		—			170.9
Deferred income taxes	—			4.1		108.4			33.7		—			146.2
Other liabilities	0.3			0.1		62.6			9.6		—			72.6
Total liabilities	(11.2		)	1,884.3		(186.4		)	409.2		—			2,095.9
Total stockholders' equity	1,254.1			1,215.9		3,098.4			688.7		(5,003.0		)	1,254.1
Total liabilities and stockholders' equity	$	1,242.9		$	3,100.2	$	2,912.0		$	1,097.9	$	(5,003.0	)	$	3,350.0

Condensed Consolidating Balance Sheets

March 31, 2017

(in millions)

	Parent			Issuers		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	4.9		$	0.1	$	253.3		$	231.8	$	—		$	490.1
Receivables, net	—			—		191.3			131.6		—			322.9
Inventories, net	—			—		223.8			91.1		—			314.9
Other current assets	4.4			—		11.0			34.8		—			50.2
Total current assets	9.3			0.1		679.4			489.3		—			1,178.1
Property, plant and equipment, net	—			—		255.3			145.6		—			400.9
Intangible assets, net	—			—		441.9			116.7		—			558.6
Goodwill	—			—		996.8			321.4		—			1,318.2
Investment in:
Issuer subsidiaries	1,020.1			—		—			—		(1,020.1		)	—
Guarantor subsidiaries	—			2,835.2		—			—		(2,835.2		)	—
Non-guarantor subsidiaries	—			—		602.2			—		(602.2		)	—
Other assets	22.6			1.8		46.8			12.3		—			83.5
Total assets	$	1,052.0		$	2,837.1	$	3,022.4		$	1,085.3	$	(4,457.5	)	$	3,539.3
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt	$	—		$	16.1	$	0.4		$	—	$	—		$	16.5
Trade payables	—			—		120.3			77.5		—			197.8
Compensation and benefits	—			—		32.4			21.9		—			54.3
Current portion of pension and postretirement benefit obligations	—			—		2.4			1.9		—			4.3
Other current liabilities	—			5.7		76.4			45.3		—			127.4
Total current liabilities	—			21.8		231.9			146.6		—			400.3
Long-term debt	—			1,568.4		37.7			0.1		—			1,606.2
Note (receivable from) payable to affiliates, net	(18.7		)	215.5		(442.2		)	245.4		—			—
Pension and postretirement benefit obligations	—			—		124.6			49.8		—			174.4
Deferred income taxes	—			1.0		175.7			32.1		—			208.8
Other liabilities	0.1			10.3		59.5			9.1		—			79.0
Total liabilities	(18.6		)	1,817.0		187.2			483.1		—			2,468.7
Total stockholders' equity	1,070.6			1,020.1		2,835.2			602.2		(4,457.5		)	1,070.6
Total liabilities and stockholders' equity	$	1,052.0		$	2,837.1	$	3,022.4		$	1,085.3	$	(4,457.5	)	$	3,539.3

Condensed Consolidating Statement of Operations

Condensed Consolidating Statements of Operations

For the Three Months Ended December 31, 2017

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	358.7		$	210.9		$	(77.3	)	$	492.3
Cost of sales	—		—			226.3			160.4			(77.3		)	309.4
Gross profit	—		—			132.4			50.5			—			182.9
Selling, general and administrative expenses	—		—			76.1			31.2			—			107.3
Restructuring and other similar charges	—		—			3.2			0.6			—			3.8
Amortization of intangible assets	—		—			7.0			1.6			—			8.6
Income from operations	—		—			46.1			17.1			—			63.2
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(18.7		)	0.1			(0.1		)	—			(18.7		)
To affiliates	0.7		6.7			(6.1		)	(1.3		)	—			—
Loss on extinguishment of debt	—		(11.9		)	—			—			—			(11.9		)
Other income (expense), net	—		(0.1		)	(2.5		)	1.6			—			(1.0		)
Income (loss) before income taxes from operations	0.7		(24.0		)	37.6			17.3			—			31.6
(Benefit) provision for income taxes	—		—			(55.4		)	5.4			—			(50.0		)
Income (loss) before equity in income of subsidiaries	0.7		(24.0		)	93.0			11.9			—			81.6
Equity in earnings of subsidiaries	80.9		104.9			11.9			—			(197.7		)	—
Net income	81.6		80.9			104.9			11.9			(197.7		)	81.6
Dividends on preferred stock	5.8		—			—			—			—			5.8
Net income attributable to Rexnord	$	75.8	$	80.9		$	104.9		$	11.9		$	(197.7	)	$	75.8
Comprehensive income	$	81.6	$	83.3		$	104.8		$	17.4		$	(197.7	)	$	89.4

Condensed Consolidating Statements of Operations

For the Nine Months Ended December 31, 2017

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	1,092.4		$	619.4		$	(221.0	)	$	1,490.8
Cost of sales	—		—			684.8			479.8			(221.0		)	943.6
Gross profit	—		—			407.6			139.6			—			547.2
Selling, general and administrative expenses	—		—			231.1			95.5			—			326.6
Restructuring and other similar charges	—		—			8.3			3.3			—			11.6
Amortization of intangible assets	—		—			20.0			4.8			—			24.8
Income from operations	—		—			148.2			36.0			—			184.2
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(59.3		)	0.4			—			—			(58.9		)
To affiliates	2.4		19.8			(18.2		)	(4.0		)	—			—
Loss on extinguishment of debt	—		(11.9		)	—			—			—			(11.9		)
Other expense, net	—		—			(4.7		)	2.2			—			(2.5		)
Income (loss) before income taxes from operations	2.4		(51.4		)	125.7			34.2			—			110.9
(Benefit) provision for income taxes	—		—			(41.6		)	14.6			—			(27.0		)
Income (loss) before equity in income of subsidiaries	2.4		(51.4		)	167.3			19.6			—			137.9
Equity in earnings of subsidiaries	135.5		186.9			19.6			—			(342.0		)	—
Net income	137.9		135.5			186.9			19.6			(342.0		)	137.9
Dividends on preferred stock	17.4		—			—			—			—			17.4
Net income attributable to Rexnord	$	120.5	$	135.5		$	186.9		$	19.6		$	(342.0	)	$	120.5
Comprehensive income	$	137.9	$	147.1		$	189.4		$	49.7		$	(342.0	)	$	182.1

Condensed Consolidating Statements of Operations

For the Three Months Ended December 31, 2016

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	331.4		$	176.4		$	(56.0	)	$	451.8
Cost of sales	—		—			217.9			136.9			(56.0		)	298.8
Gross profit	—		—			113.5			39.5			—			153.0
Selling, general and administrative expenses	—		—			70.5			29.4			—			99.9
Restructuring and other similar charges	—		—			10.9			0.8			—			11.7
Amortization of intangible assets	—		—			7.0			1.6			—			8.6
Income from operations	—		—			25.1			7.7			—			32.8
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(22.8		)	(0.1		)	—			—			(22.9		)
To affiliates	0.2		16.4			(13.7		)	(2.9		)	—			—
Loss on extinguishment of debt	—		(7.8		)	—			—			—			(7.8		)
Other expense, net	—		—			(0.3		)	(0.4		)	—			(0.7		)
Income (loss) before income taxes from operations	0.2		(14.2		)	11.0			4.4			—			1.4
(Benefit) provision for income taxes	—		—			(6.5		)	4.7			—			(1.8		)
Net income (loss) before equity in loss of subsidiaries	0.2		(14.2		)	17.5			(0.3		)	—			3.2
Equity in earnings (loss) of subsidiaries	3.0		17.2			(0.3		)	—			(19.9		)	—
Net income	3.2		3.0			17.2			(0.3		)	(19.9		)	3.2
Dividends on preferred stock	1.5		—			—			—			—			1.5
Net income attributable to Rexnord	$	1.7	$	3.0		$	17.2		$	(0.3	)	$	(19.9	)	$	1.7
Comprehensive income (loss)	$	3.2	$	0.3		$	5.5		$	(16.4	)	$	(19.9	)	$	(27.3	)

Condensed Consolidating Statements of Operations

For the Nine Months Ended December 31, 2016

(in millions)

	Parent		Issuers			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Net sales	$	—	$	—		$	1,043.6		$	545.5		$	(174.5	)	$	1,414.6
Cost of sales	—		—			682.5			414.2			(174.5		)	922.2
Gross profit	—		—			361.1			131.3			—			492.4
Selling, general and administrative expenses	—		—			224.0			89.1			—			313.1
Restructuring and other similar charges	—		—			18.5			3.2			—			21.7
Amortization of intangible assets	—		—			28.7			5.0			—			33.7
Income from operations	—		—			89.9			34.0			—			123.9
Non-operating (expense) income:
Interest income (expense), net:
To third parties	—		(68.8		)	(0.5		)	(0.1		)	—			(69.4		)
To affiliates	0.2		58.4			(40.1		)	(18.5		)	—			—
Loss on extinguishment of debt	—		(7.8		)	—			—			—			(7.8		)
Other (expense) income, net	—		(0.5		)	(1.9		)	(0.9		)	—			(3.3		)
Income (loss) before income taxes from operations	0.2		(18.7		)	47.4			14.5			—			43.4
Provision (benefit) for income taxes	—		0.1			(14.2		)	10.8			—			(3.3		)
Income (loss) before equity in income of subsidiaries	0.2		(18.8		)	61.6			3.7			—			46.7
Equity in earnings of subsidiaries	46.5		65.3			3.7			—			(115.5		)	—
Net income	46.7		46.5			65.3			3.7			(115.5		)	46.7
Dividends on preferred stock	1.5		—			—			—			—			1.5
Net income attributable to Rexnord	$	45.2	$	46.5		$	65.3		$	3.7		$	(115.5	)	$	45.2
Comprehensive income (loss)	$	46.7	$	46.4		$	47.7		$	(7.3	)	$	(115.5	)	$	18.0

Condensed Consolidating Statement of Cash Flows

Condensed Consolidating Statements of Cash Flows

For the Nine Months Ended December 31, 2017

(in millions)

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Operating activities
Cash provided by (used for) operating activities	$	9.6		$	311.8		$	(154.8	)	$	(44.7	)	$	—	$	121.9
Investing activities
Expenditures for property, plant and equipment	—			—			(18.2		)	(6.9		)	—		(25.1		)
Acquisitions, net of cash	—			—			(50.0		)	—			—		(50.0		)
Proceeds from dispositions of property, plant and equipment	—			—			5.2			0.3			—		5.5
Cash used for investing activities	—			—			(63.0		)	(6.6		)	—		(69.6		)
Financing activities
Proceeds from borrowings of long-term debt	—			1,325.0			—			—			—		1,325.0
Repayments of long-term debt	—			(1,603.2		)	—			—			—		(1,603.2		)
Repayments of short-term debt	—			(24.3		)	—			—			—		(24.3		)
Payment of debt issuance costs	—			(9.0		)	—			—			—		(9.0		)
Proceeds from exercise of stock options	2.9			—			—			—			—		2.9
Proceeds from financing lease obligation	—			—			5.8			—			—		5.8
Payments of dividend on preferred stock	(17.4		)	—			—			—			—		(17.4		)
Cash (used for) provided by financing activities	(14.5		)	(311.5		)	5.8			—			—		(320.2		)
Effect of exchange rate changes on cash and cash equivalents	—			—			—			12.6			—		12.6
(Decrease) increase in cash and cash equivalents	(4.9		)	0.3			(212.0		)	(38.7		)	—		(255.3		)
Cash and cash equivalents at beginning of period	4.9			0.1			253.3			231.8			—		490.1
Cash and cash equivalents at end of period	$	—		$	0.4		$	41.3		$	193.1		$	—	$	234.8

Condensed Consolidating Statements of Cash Flows

For the Nine Months Ended December 31, 2016

(in millions)

	Parent			Issuer			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated
Operating activities
Net cash (used for) provided by operating activities	$	(404.9	)	$	304.7		$	161.2		$	61.1		$	—	$	122.1
Investing activities
Expenditures for property, plant and equipment	—			—			(35.1		)	(8.9		)	—		(44.0		)
Acquisitions, net of cash	—			—			(213.4		)	(0.3		)	—		(213.7		)
Proceeds from dispositions of property, plant and equipment	—			—			1.9			—			—		1.9
Cash used for investing activities	—			—			(246.6		)	(9.2		)	—		(255.8		)
Financing activities
Proceeds from borrowings of long-term debt	—			1,590.3			—			—			—		1,590.3
Repayments of long-term debt	—			(1,881.8		)	—			—			—		(1,881.8		)
Proceeds from borrowings of short-term debt	—			16.1			—			—			—		16.1
Repayments of short-term debt	—			(19.5		)	—			—			—		(19.5		)
Payment of debt issuance costs	—			(10.6		)	—			—			—		(10.6		)
Proceeds from issuance of preferred stock, net of direct offering costs	390.2			—			—			—			—		390.2
Proceeds from exercise of stock options	9.6			—			—			—			—		9.6
Deferred acquisition payment	—			—			—			(5.7		)	—		(5.7		)
Cash provided by (used for) financing activities	399.8			(305.5		)	—			(5.7		)	—		88.6
Effect of exchange rate changes on cash and cash equivalents	—			—			—			(10.2		)	—		(10.2		)
(Decrease) increase in cash and cash equivalents	(5.1		)	(0.8		)	(85.4		)	36.0			—		(55.3		)
Cash and cash equivalents at beginning of period	6.1			2.0			290.1			186.4			—		484.6
Cash and cash equivalents at end of period	$	1.0		$	1.2		$	204.7		$	222.4		$	—	$	429.3

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Acquisitions - Narrative (Details) € in Millions, $ in Millions			3 Months Ended	9 Months Ended		12 Months Ended
	Oct. 04, 2017 USD ($)	Jun. 01, 2016 USD ($)	Mar. 31, 2018 EUR (€)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Mar. 31, 2017 USD ($)
Business Acquisition [Line Items]
Cash purchase price, net				$ 50.0	$ 213.7
Goodwill				$ 1,353.8		$ 1,318.2
World Dryer
Business Acquisition [Line Items]
Cash purchase price, net	$ 50.0
Goodwill	25.8
Other intangible assets	28.1
Other net liabilities	3.9
World Dryer | Tradenames
Business Acquisition [Line Items]
Other intangible assets	7.0
World Dryer | Customer Relationships
Business Acquisition [Line Items]
Other intangible assets	$ 21.1
Centa | Scenario, Forecast
Business Acquisition [Line Items]
Purchase price | €			€ 118
Cambridge
Business Acquisition [Line Items]
Cash purchase price, net		$ 210.0
Goodwill		129.4
Other intangible assets		80.6
Purchase price		213.4
Additional consideration transferred		3.4
Other net assets		3.4
Cambridge | Tradenames
Business Acquisition [Line Items]
Other intangible assets		16.8
Cambridge | Customer Relationships
Business Acquisition [Line Items]
Other intangible assets		58.3
Cambridge | Patents
Business Acquisition [Line Items]
Other intangible assets		$ 5.5
Water Management
Business Acquisition [Line Items]
Cash purchase price, net						$ 0.3

XML

Restructuring and Other Similar Charges - Costs to Date by Segment (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	$ 3.8	$ 11.7	$ 11.6	$ 21.7
Employee termination benefits
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	1.2	6.8	5.8	15.0
Asset impairment charges
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	1.6	1.6	1.6	1.6
Contract termination and other associated costs
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	2.6	3.3	5.8	5.1
Process & Motion Control
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	3.0	8.6	7.7	14.6
Process & Motion Control | Employee termination benefits
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	0.6	5.1	2.5	9.6
Process & Motion Control | Asset impairment charges
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges		1.6		1.6
Process & Motion Control | Contract termination and other associated costs
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	2.4	1.9	5.2	3.4
Water Management
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	0.8	3.1	3.9	7.1
Water Management | Employee termination benefits
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	0.6	1.7	3.3	5.4
Water Management | Asset impairment charges
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges		0.0		0.0
Water Management | Contract termination and other associated costs
Restructuring Cost and Reserve [Line Items]
Total restructuring and other similar charges	$ 0.2	$ 1.4	$ 0.6	$ 1.7

XML

Restructuring and Other Similar Charges - Reserve Roll Forward (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Restructuring Reserve [Roll Forward]
Restructuring accrual, beginning period			$ 12.0
Charges	$ 3.8	$ 11.7	11.6	$ 21.7
Cash payments			(19.9)
Restructuring accrual, ending period	3.7		3.7
Employee termination benefits
Restructuring Reserve [Roll Forward]
Restructuring accrual, beginning period			11.0
Charges	1.2	6.8	5.8	15.0
Cash payments			(13.3)
Restructuring accrual, ending period	3.5		3.5
Contract termination and other associated costs
Restructuring Reserve [Roll Forward]
Restructuring accrual, beginning period			1.0
Charges	2.6	$ 3.3	5.8	$ 5.1
Cash payments			(6.6)
Restructuring accrual, ending period	$ 0.2		$ 0.2

XML

Restructuring and Other Similar Charges - Narrative (Details) - USD ($)	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Restructuring Cost and Reserve [Line Items]
Accelerated depreciation	$ 0	$ 3,800,000	$ 1,000,000	$ 5,200,000
Restructuring and other similar charges	$ 3,800,000	11,700,000	$ 11,600,000	21,700,000
RHF Product Line
Restructuring Cost and Reserve [Line Items]
Pre-tax Loss		2,200,000		6,700,000
Restructuring and other similar charges		$ 300,000		$ 1,900,000

XML

Income Taxes - Narrative (Details) - USD ($) $ in Millions		3 Months Ended			9 Months Ended		12 Months Ended
	Jan. 01, 2018	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Mar. 31, 2018
Income Tax Examination [Line Items]
Federal income tax rate		35.00%
Estimated income tax benefit, effect of U.S. tax reform		$ 54.8
Tax benefit associated with remeasurement of deferred tax liability		62.2
Tax expense associated with repatriated earnings from foreign subsidiaries		7.4
One-time repatriation tax, included in repatriated earnings from foreign subsidiaries		3.0
Tax benefit associated with reduction in tax rate		2.1			$ 2.1
Income tax benefit		$ 50.0		$ 1.8	$ 27.0	$ 3.3
Effective income tax rate		(158.20%)		(128.60%)	(24.30%)	(7.60%)
Unrecognized net income tax benefits		$ 19.0			$ 19.0
Unrecognized net income tax benefits, total liability			$ 18.1
Interest and penalties included in unrecognized tax benefits		$ 5.5	4.7		5.5
Interest and penalties recognized as income tax expense					$ 0.3	$ 0.3
Ministry of Economic Affairs and Finance, Italy | Foreign Tax Authority
Income Tax Examination [Line Items]
Interest and penalties recognized as income tax expense				$ 0.7
Federal Ministry of Finance, Germany | Foreign Tax Authority
Income Tax Examination [Line Items]
Interest and penalties recognized as income tax expense			$ 0.4
Scenario, Forecast
Income Tax Examination [Line Items]
Blended federal income tax rate							31.55%
Subsequent Event
Income Tax Examination [Line Items]
Federal income tax rate	21.00%

XML

Earnings per Share - Earnings per Share Computation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Mar. 31, 2017
Numerator:
Total net of tax	$ 81.6	$ 3.2	$ 137.9	$ 46.7
Less: Dividends on preferred stock, basic	(5.8)	(1.5)	(17.4)	(1.5)
Net income attributable to Rexnord common stockholders	$ 75.8	$ 1.7	$ 120.5	$ 45.2
Net income per share attributable to Rexnord common stockholders - basic (in dollars per share)	$ 0.73	$ 0.02	$ 1.16	$ 0.44
Net income attributable to Rexnord common stockholders, diluted	$ 81.6	$ 1.7	$ 137.9	$ 45.2
Denominator:
Weighted-average common shares outstanding, basic (in shares)	103,964	103,113	103,824	102,514
Effect of dilutive equity awards (in shares)	1,966	1,445	1,845	1,967
Preferred stock under the if-converted method (in shares)	16,087	0	16,694	0
Diluted (in shares)	122,017	104,558	122,363	104,481
Net income per share attributable to Rexnord common stockholders - dilutive (in dollars per share)	$ 0.67	$ 0.02	$ 1.13	$ 0.43
Antidilutive securities excluded from computation of earnings per share (in shares)	2,800	5,500	2,700	5,300
Redeemable Convertible Preferred Stock
Denominator:
Dividend rate, percentage			5.75%		5.75%
Preferred Stock
Denominator:
Antidilutive securities excluded from computation of earnings per share (in shares)		5,100		1,700

XML

Earnings per Share - Narrative (Details) - shares shares in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Earnings Per Share [Abstract]
Antidilutive securities excluded from computation of earnings per share (in shares)	2.8	5.5	2.7	5.3

XML

Stockholders' Equity - Roll Forward (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance			$ 1,070.6
Total comprehensive income	$ 89.4	$ (27.3)	182.1	$ 18.0
Stock-based compensation expense			15.9
Exercise of stock options			2.9
Preferred stock dividends			(17.4)
Ending Balance	1,254.1		1,254.1
Preferred Stock
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance			0.0
Ending Balance	0.0		0.0
Common Stock
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance			1.0
Ending Balance	1.0		1.0
Additional Paid-In Capital
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance			1,262.1
Stock-based compensation expense			15.9
Exercise of stock options			2.9
Preferred stock dividends			(10.8)
Ending Balance	1,270.1		1,270.1
Retained (Deficit) Earnings
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance			(55.5)
Total comprehensive income			137.9
Preferred stock dividends			(6.6)
Ending Balance	75.8		75.8
Accumulated Other Comprehensive (Loss) Income
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning Balance			(137.0)
Total comprehensive income			44.2
Ending Balance	$ (92.8)		$ (92.8)

XML

Stockholders' Equity - Narrative (Details)	3 Months Ended	9 Months Ended
	Dec. 31, 2017 USD ($) shares	Dec. 31, 2017 USD ($) shares	Dec. 31, 2016 USD ($) $ / shares shares	Mar. 31, 2017 shares	Mar. 31, 2015 USD ($)
Class of Stock [Line Items]
Dividends on preferred stock	$ 5,800,000	$ 17,400,000
Stock repurchase program, existing repurchase authority	$ 160,000,000	$ 160,000,000
Term loan | Credit Facility
Class of Stock [Line Items]
Voluntary prepayment			$ 195,000,000
Depositary Shares
Class of Stock [Line Items]
Shares issued (in shares) | shares			8,050,000
Preferred stock, conversion ratio			0.05
Preferred Stock
Class of Stock [Line Items]
Shares issued (in shares) | shares	402,500	402,500	402,500	402,500
Offering price (in dollars per share) | $ / shares			$ 50
Liquidation preference per share (in dollars per share) | $ / shares			$ 1,000
Proceeds from offering			$ 390,200,000
Dividends in arrears		$ 0
Preferred Stock | Minimum
Class of Stock [Line Items]
Convertible preferred stock, shares issued upon conversion (in shares) | shares			39.702
Preferred Stock | Maximum
Class of Stock [Line Items]
Convertible preferred stock, shares issued upon conversion (in shares) | shares			47.642
Common Stock
Class of Stock [Line Items]
Stock repurchase program, authorized amount (up to)					$ 200,000,000
Stock repurchased during the period (in shares) | shares		0	0

XML

Accumulated Other Comprehensive Loss - Changes in Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance			$ 1,070.6
Other comprehensive income before reclassifications			41.6
Amounts reclassified from accumulated other comprehensive loss			2.6
Other comprehensive income (loss), net of tax	$ 7.8	$ (30.5)	44.2	$ (28.7)
Ending Balance	1,254.1		1,254.1
Interest Rate Derivatives
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance			(9.5)
Other comprehensive income before reclassifications			0.0
Amounts reclassified from accumulated other comprehensive loss			3.6
Other comprehensive income (loss), net of tax			3.6
Ending Balance	(5.9)		(5.9)
Foreign Currency Translation
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance			(99.3)
Other comprehensive income before reclassifications			41.6
Amounts reclassified from accumulated other comprehensive loss			0.0
Other comprehensive income (loss), net of tax			41.6
Ending Balance	(57.7)		(57.7)
Pension and Postretirement Plans
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance			(28.2)
Other comprehensive income before reclassifications			0.0
Amounts reclassified from accumulated other comprehensive loss			(1.0)
Other comprehensive income (loss), net of tax			(1.0)
Ending Balance	(29.2)		(29.2)
AOCI Attributable to Parent
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance			(137.0)
Ending Balance	$ (92.8)		$ (92.8)

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Accumulated Other Comprehensive Loss - Reclassifications out of Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Pension and other postretirement plans
Selling, general and administrative expenses	$ 107.3	$ 99.9	$ 326.6	$ 313.1
Provision (benefit) for income taxes	(50.0)	(1.8)	(27.0)	(3.3)
Total net of tax	81.6	3.2	137.9	46.7
Interest rate derivatives
Benefit for income taxes	(50.0)	(1.8)	(27.0)	(3.3)
Total net of tax	(81.6)	(3.2)	(137.9)	(46.7)
Reclassification out of Accumulated Other Comprehensive Income | Accumulated Defined Benefit Plans Adjustment, Net Prior Service Attributable to Parent
Pension and other postretirement plans
Selling, general and administrative expenses	(0.5)	(0.5)	(1.5)	(1.4)
Reclassification out of Accumulated Other Comprehensive Income | Accumulated Defined Benefit Plans Adjustment
Pension and other postretirement plans
Provision (benefit) for income taxes	0.1	0.2	0.5	0.5
Total net of tax	(0.4)	(0.3)	(1.0)	(0.9)
Interest rate derivatives
Benefit for income taxes	0.1	0.2	0.5	0.5
Total net of tax	0.4	0.3	1.0	0.9
Reclassification out of Accumulated Other Comprehensive Income | Accumulated Net Gain (Loss) from Cash Flow Hedges Including Portion Attributable to Noncontrolling Interest
Pension and other postretirement plans
Total net of tax	(0.3)	(1.7)	(3.6)	(4.9)
Interest rate derivatives
Total net of tax	0.3	1.7	3.6	4.9
Reclassification out of Accumulated Other Comprehensive Income | Accumulated Net Gain (Loss) from Cash Flow Hedges Including Portion Attributable to Noncontrolling Interest | Interest rate derivatives
Pension and other postretirement plans
Provision (benefit) for income taxes	(1.5)	(1.0)	(3.6)	(3.0)
Interest rate derivatives
Net realized losses on interest rate hedges	1.8	2.7	7.2	7.9
Benefit for income taxes	$ (1.5)	$ (1.0)	$ (3.6)	$ (3.0)

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Inventories - Inventory by Category (Details) - USD ($) $ in Millions	Dec. 31, 2017	Mar. 31, 2017
Inventory, Net [Abstract]
Finished goods	$ 153.7	$ 139.9
Work in progress	47.4	44.4
Purchased components	81.4	74.0
Raw materials	59.2	47.7
Inventories at First-in, First-Out (FIFO) cost	341.7	306.0
Adjustment to state inventories at Last-in, First-Out (LIFO) cost	8.2	8.9
Inventories	$ 349.9	$ 314.9

XML

Goodwill and Intangible Assets - Changes in Net Carrying Value (Details) $ in Millions	9 Months Ended
	Dec. 31, 2017 USD ($)
Goodwill [Roll Forward]
Net carrying amount, beginning of period	$ 1,318.2
Acquisitions	25.8
Currency translation adjustment and other	9.8
Net carrying amount, end of period	1,353.8
Process & Motion Control
Goodwill [Roll Forward]
Net carrying amount, beginning of period	1,068.8
Acquisitions	0.0
Currency translation adjustment and other	3.0
Net carrying amount, end of period	1,071.8
Water Management
Goodwill [Roll Forward]
Net carrying amount, beginning of period	249.4
Acquisitions	25.8
Currency translation adjustment and other	6.8
Net carrying amount, end of period	$ 282.0

XML

Goodwill and Intangible Assets - Gross Carrying Amount and Accumulated Amortization (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Dec. 31, 2017	Mar. 31, 2017
Intangible assets subject to amortization:
Weighted Average Useful Life	13 years	13 years
Accumulated Amortization	$ (544.9)	$ (518.2)
Intangible assets not subject to amortization - tradenames
Gross Carrying Amount	1,112.8	1,076.8
Net Carrying Amount	$ 567.9	$ 558.6
Patents
Intangible assets subject to amortization:
Weighted Average Useful Life	10 years	10 years
Gross Carrying Amount	$ 47.5	$ 47.0
Accumulated Amortization	(38.9)	(37.7)
Net Carrying Amount	$ 8.6	$ 9.3
Customer relationships (including distribution network)
Intangible assets subject to amortization:
Weighted Average Useful Life	13 years	13 years
Gross Carrying Amount	$ 710.6	$ 685.8
Accumulated Amortization	(498.3)	(475.2)
Net Carrying Amount	$ 212.3	$ 210.6
Intangible assets not subject to amortization - tradenames
Acquired finite-lived intangible assets, Weighted Average Useful Life	14 years
Tradenames
Intangible assets subject to amortization:
Weighted Average Useful Life	12 years	12 years
Gross Carrying Amount	$ 37.1	$ 29.5
Accumulated Amortization	(7.7)	(5.3)
Net Carrying Amount	29.4	24.2
Intangible assets not subject to amortization - tradenames
Intangible assets not subject to amortization - tradenames	$ 317.6	$ 314.5
Acquired finite-lived intangible assets, Weighted Average Useful Life	14 years

XML

Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible asset amortization expense	$ 8.6	$ 8.6	$ 24.8	$ 33.7
Amortization expense in fiscal year 2018	33.4		33.4
Amortization expense in fiscal year 2019	34.3		34.3
Amortization expense in fiscal year 2020	34.1		34.1
Amortization expense in fiscal year 2021	32.6		32.6
Amortization expense in fiscal year 2022	$ 28.3		$ 28.3

XML

Other Current Liabilities - By Category (Details) - USD ($) $ in Millions	Dec. 31, 2017	Mar. 31, 2017
Components of Other Current Liabilities [Line Items]
Other liabilities	$ 126.7	$ 127.4
Customer advances
Components of Other Current Liabilities [Line Items]
Other liabilities	10.5	10.9
Sales rebates
Components of Other Current Liabilities [Line Items]
Other liabilities	30.2	25.5
Commissions
Components of Other Current Liabilities [Line Items]
Other liabilities	6.3	6.3
Restructuring and other similar charges
Components of Other Current Liabilities [Line Items]
Other liabilities	3.7	12.0
Product warranty
Components of Other Current Liabilities [Line Items]
Other liabilities	7.5	7.5
Risk management
Components of Other Current Liabilities [Line Items]
Other liabilities	9.6	8.9
Legal and environmental
Components of Other Current Liabilities [Line Items]
Other liabilities	4.5	4.4
Taxes, other than income taxes
Components of Other Current Liabilities [Line Items]
Other liabilities	7.1	10.5
Income tax payable
Components of Other Current Liabilities [Line Items]
Other liabilities	19.2	17.8
Interest payable
Components of Other Current Liabilities [Line Items]
Other liabilities	2.3	5.7
Other
Components of Other Current Liabilities [Line Items]
Other liabilities	$ 25.8	$ 17.9

XML

Long-Term Debt - Summary of Debt (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 07, 2017	Mar. 31, 2017
Debt Instrument [Line Items]
Total	$ 1,323.1		$ 1,622.7
Less current maturities	0.2		16.5
Long-term debt	1,322.9		1,606.2
New Market Tax Credit | Loan Receivable
Debt Instrument [Line Items]
Loan receivable	27.6		27.6
Senior notes | Term loan
Debt Instrument [Line Items]
Total	791.2		1,584.5
Unamortized discount and debt issuance costs	8.8		17.9
Senior notes | 4.875% Senior notes due 2025
Debt Instrument [Line Items]
Total	494.1
Unamortized debt issuance costs	$ 5.9
Stated interest rate on debt	4.875%	4.875%
Other subsidiary debt | Other subsidiary debt
Debt Instrument [Line Items]
Total	$ 37.8		38.2
Unamortized debt issuance costs	0.5		0.5
Other subsidiary debt | New Market Tax Credit
Debt Instrument [Line Items]
Loan payable	$ 36.9		$ 36.9

XML

Long-Term Debt - Narrative (Details)			3 Months Ended		9 Months Ended
	Dec. 07, 2017 USD ($)	Dec. 06, 2017 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Mar. 31, 2017 USD ($)
Debt Instrument [Line Items]
Proceeds from borrowings of long-term debt					$ 1,325,000,000	$ 1,590,300,000
Loss on extinguishment of debt			$ 11,900,000	$ 7,800,000	11,900,000	7,800,000
Amortization of deferred financing costs					1,400,000	$ 1,900,000
Accounts Receivable Securitization Program | Revolving Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity			100,000,000.0		100,000,000.0
Available borrowing capacity			100,000,000		100,000,000		$ 100,000,000
Term Refinancing Loan Facility | Senior Secured Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 800,000,000	$ 1,606,400,000.0	$ 800,000,000		$ 800,000,000
Weighted-average effective interest rate			3.80%		3.80%
Loss on extinguishment of debt					$ 8,000,000
Revolving Credit Facility | Senior Secured Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity	264,000,000	$ 265,000,000	$ 264,000,000.0		264,000,000.0
Debt issuance costs, capitalized	200,000
Amounts borrowed			0		0		0
Utilized in connection with outstanding letters of credit			8,900,000		8,900,000		14,600,000
Revolving Credit Facility | Accounts Receivable Securitization Program
Debt Instrument [Line Items]
Amounts borrowed			0		0		0
Utilized in connection with outstanding letters of credit			$ 7,000,000		$ 7,000,000		$ 4,600,000
Credit Facility | Senior Secured Credit Facility
Debt Instrument [Line Items]
Company's total net leverage ratio			3.0		3.0
Credit Facility | Senior Secured Credit Facility | Maximum | Senior Secured Leverage Ratio (Numerator)
Debt Instrument [Line Items]
Maximum permitted total net leverage ratio			6.75		6.75
Amended Term Refinancing Loan Facility | Senior Secured Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 800,000,000
LIBOR floor, scenario one	0.00%
LIBOR floor, scenario two	0.00%
Amortization of deferred financing costs					$ 3,900,000
Debt issuance costs, capitalized			$ 800,000		800,000
Amended Term Refinancing Loan Facility | Senior Secured Credit Facility | London Interbank Offered Rate (LIBOR), Scenario One
Debt Instrument [Line Items]
Applicable margin	2.25%	2.75%
Amended Term Refinancing Loan Facility | Senior Secured Credit Facility | Base Rate, Scenario One
Debt Instrument [Line Items]
Applicable margin	1.25%	1.75%
Amended Term Refinancing Loan Facility | Senior Secured Credit Facility | London Interbank Offered Rate (LIBOR), Scenario Two
Debt Instrument [Line Items]
Applicable margin	2.00%
Amended Term Refinancing Loan Facility | Senior Secured Credit Facility | Base Rate, Scenario Two
Debt Instrument [Line Items]
Applicable margin	1.00%
Term Refinancing Loan Facility And Amended Term Refinancing Loan Facility | Senior Secured Credit Facility
Debt Instrument [Line Items]
Loss on extinguishment of debt					11,900,000
Senior notes | 4.875% Senior notes due 2025
Debt Instrument [Line Items]
Proceeds from borrowings of long-term debt	$ 500,000,000
Debt issuance costs, capitalized			$ 6,000,000		$ 6,000,000
Stated interest rate on debt	4.875%		4.875%		4.875%
Redemption price, percentage (up to)	40.00%
Percentage of principal amount redeemed	101.00%
Event of default, restricted subsidiaries, amount (in excess of)	$ 50,000,000

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Derivative Financial Instruments - Narrative (Details)	9 Months Ended	12 Months Ended
	Dec. 31, 2017 USD ($) derivative	Mar. 31, 2015 USD ($)	Mar. 31, 2016 USD ($)
Derivatives, Fair Value [Line Items]
Expected reclassification of loss into earnings as interest expense	$ 8,200,000
Interest rate caps
Derivatives, Fair Value [Line Items]
Number of interest rate derivatives | derivative	2
Derivative liability, notional amount		$ 750,000,000.0
Variable rate interest		3.00%
Derivative, cost of hedge		$ 5,800,000
Interest rate swaps
Derivatives, Fair Value [Line Items]
Number of interest rate derivatives | derivative	3
Derivative, notional amount			$ 650,000,000.0
Weighted average fixed interest rate			2.55%

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Derivative Financial Instruments - Foreign Currency Forward Contracts Asset Position (Details) - USD ($) $ in Millions	Dec. 31, 2017	Mar. 31, 2017
Designated as Hedging Instrument | Other assets | Interest rate caps
Derivative [Line Items]
Asset Derivatives	$ 0.0	$ 0.0
Designated as Hedging Instrument | Other current liabilities | Interest rate swaps
Derivative [Line Items]
Liability Derivatives	3.6	0.0
Designated as Hedging Instrument | Other liabilities | Interest rate swaps
Derivative [Line Items]
Liability Derivatives	0.0	10.3
Not Designated as Hedging Instrument | Other current liabilities | Foreign currency forward contracts
Derivative [Line Items]
Liability Derivatives	$ 0.0	$ 0.1

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Derivative Financial Instruments - Gains/Losses in AOCI (Details) - Designated as Hedging Instrument - USD ($) $ in Millions	Dec. 31, 2017	Mar. 31, 2017
Interest rate swaps
Accumulated Other Comprehensive Income (Loss) [Line Items]
Amount of loss recognized in accumulated other comprehensive loss	$ 3.3	$ 6.4
Interest rate caps
Accumulated Other Comprehensive Income (Loss) [Line Items]
Amount of loss recognized in accumulated other comprehensive loss	$ 1.8	$ 3.1

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Derivative Financial Instruments - Gain or Loss Recognized in Income (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Other expense, net | Foreign currency forward contracts
Trading Activity, Gains and Losses, Net [Line Items]
Amount recognized as (income) expense	$ (0.5)	$ 0.0	$ 0.0	$ 0.5
Interest expense, net | Interest rate swaps
Trading Activity, Gains and Losses, Net [Line Items]
Amount recognized as (income) expense	$ (2.2)	$ 0.0	$ (2.2)	$ 0.0

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Fair Value Measurements - Schedule of Assets and Liabilities Measured on Recurring and Nonrecurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions	Dec. 31, 2017	Mar. 31, 2017
Liabilities:
Total liabilities at fair value	$ 3.6	$ 10.4
Assets:
Total assets at fair value		0.0
Interest rate derivatives
Liabilities:
Interest rate derivatives and interest rate swaps	3.6
Foreign currency forward contracts
Liabilities:
Foreign currency forward contracts	0.0	0.1
Interest rate caps
Assets:
Interest rate caps		0.0
Interest rate swaps
Liabilities:
Interest rate derivatives and interest rate swaps		10.3
Level 1
Liabilities:
Total liabilities at fair value	0.0	0.0
Assets:
Total assets at fair value		0.0
Level 1 | Interest rate derivatives
Liabilities:
Interest rate derivatives and interest rate swaps	0.0
Level 1 | Foreign currency forward contracts
Liabilities:
Foreign currency forward contracts	0.0	0.0
Level 1 | Interest rate caps
Assets:
Interest rate caps		0.0
Level 1 | Interest rate swaps
Liabilities:
Interest rate derivatives and interest rate swaps		0.0
Level 2
Liabilities:
Total liabilities at fair value	3.6	10.4
Assets:
Total assets at fair value		0.0
Level 2 | Interest rate derivatives
Liabilities:
Interest rate derivatives and interest rate swaps	3.6
Level 2 | Foreign currency forward contracts
Liabilities:
Foreign currency forward contracts	0.0	0.1
Level 2 | Interest rate caps
Assets:
Interest rate caps		0.0
Level 2 | Interest rate swaps
Liabilities:
Interest rate derivatives and interest rate swaps		10.3
Level 3
Liabilities:
Total liabilities at fair value	0.0	0.0
Assets:
Total assets at fair value		0.0
Level 3 | Interest rate derivatives
Liabilities:
Interest rate derivatives and interest rate swaps	0.0
Level 3 | Foreign currency forward contracts
Liabilities:
Foreign currency forward contracts	$ 0.0	0.0
Level 3 | Interest rate caps
Assets:
Interest rate caps		0.0
Level 3 | Interest rate swaps
Liabilities:
Interest rate derivatives and interest rate swaps		$ 0.0

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Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions	Dec. 31, 2017	Mar. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value of long-term debt	$ 1,345.2	$ 1,644.6
Net realizable value, property, plant and equipment	389.3	400.9
Facility Closing
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Net realizable value, property, plant and equipment	$ 6.3	$ 7.0

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Commitments and Contingencies - Warranty Roll Forward (Details) - USD ($) $ in Millions	9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Movement in Product Warranty Accrual [Roll Forward]
Balance at beginning of period	$ 7.5	$ 6.8
Acquired obligations	0.2	0.4
Charged to operations	3.2	2.9
Claims settled	(3.4)	(2.9)
Balance at end of period	$ 7.5	$ 7.2

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Commitments and Contingencies - Narrative (Details)		3 Months Ended	12 Months Ended
	Dec. 31, 2017 USD ($) lawsuit claimant carrier	Dec. 31, 2017 USD ($) lawsuit claimant	Mar. 31, 2013 USD ($)	Dec. 31, 2002 defendant
Loss Contingencies [Line Items]
Indemnification resulting from business acquisition, amount (in excess of)	$ 900,000,000	$ 900,000,000
Insurance policy coverage	$ 241,000,000	241,000,000
Number of carriers, if insolvent, could impact coverage (or more) | carrier	1
Net proceeds from sale-leaseback transaction		5,800,000
Gain or loss recognized, sale-leaseback transaction		0
Layer 1
Loss Contingencies [Line Items]
Insurance policy coverage	$ 165,000,000	$ 165,000,000
Environmental Issue | Ellsworth Industrial Park Site
Loss Contingencies [Line Items]
Indemnification resulting from business acquisition, percentage of costs paid to date by seller				100.00%
Asbestos Issue | Stearns
Loss Contingencies [Line Items]
Indemnification resulting from business acquisition, percentage of costs paid to date by seller	100.00%	100.00%
Number of claimants | claimant	300	300
Asbestos Issue | Prager
Loss Contingencies [Line Items]
Number of lawsuits | lawsuit	2	2
Insurance coverage, percentage of costs paid to date by insurance providers	100.00%	100.00%
Asbestos Issue | Falk
Loss Contingencies [Line Items]
Indemnification resulting from business acquisition, percentage of costs paid to date by seller	100.00%	100.00%
Number of claimants | claimant	100	100
Asbestos Issue | Zurn
Loss Contingencies [Line Items]
Number of claimants | claimant	16,000	16,000
Number of pending lawsuits | lawsuit	6,000	6,000
Time frame of claims expected to be filed	10 years
Estimate of possible loss	$ 37,000,000	$ 37,000,000
Estimated claim payments made over specified period	$ 28,000,000	28,000,000
Time frame of estimated claims disbursements	10 years
Estimated insurance recoveries	$ 37,000,000	$ 37,000,000
Damages from Product Defects | Zurn
Loss Contingencies [Line Items]
Claim settlement funding period			7 years
Litigation settlement			$ 20,000,000
Minimum | Environmental Issue | Ellsworth Industrial Park Site
Loss Contingencies [Line Items]
Number of defendants | defendant				10

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Retirement Benefits - Schedule of Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Pension Benefits
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 0.2	$ 0.5	$ 0.6	$ 1.4
Interest cost	6.1	6.4	18.3	19.0
Expected return on plan assets	(6.6)	(6.8)	(19.8)	(20.0)
Amortization:
Prior service credit	0.0	0.0	0.0	0.1
Net periodic benefit (credit) cost	(0.3)	0.1	(0.9)	0.5
Other Postretirement Benefits
Defined Benefit Plan Disclosure [Line Items]
Interest cost	0.2	0.3	0.3	0.9
Amortization:
Prior service credit	(0.5)	(0.5)	(1.5)	(1.5)
Net periodic benefit (credit) cost	$ (0.3)	$ (0.2)	$ (1.2)	$ (0.6)

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Retirement Benefits - Narrative (Details) $ in Millions	9 Months Ended
	Dec. 31, 2017 USD ($) plan	Dec. 31, 2016 USD ($)	Dec. 30, 2017 plan
Retirement Benefits [Abstract]
Contributions by employer | $	$ 2.9	$ 4.6
Number of plans | plan	1		3

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Stock-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 5.1	$ 3.8	$ 15.9	$ 9.8
Total unrecognized compensation cost	$ 29.4		$ 29.4
Unrecognized compensation cost, period for recognition			1 year 9 months 18 days
Award vesting period			3 years	3 years
Expected dividend rate			0.00%
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend rate			0.00%
Weighted average grant date fair value (in dollars per share)			$ 8.11
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period			3 years	3 years
Performance Shares (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period			3 years
Expected dividend rate			0.00%
Weighted average grant date fair value (in dollars per share)			$ 31.25
Performance Shares (PSUs) | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting rights, percentage			0.00%
Performance Shares (PSUs) | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting rights, percentage			200.00%

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Stock-Based Compensation - Stock Options (Details) - $ / shares	9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Expected dividend rate	0.00%
Shares
Outstanding at beginning of period (in shares)	7,770,670	7,854,685
Granted (in shares)	1,175,702	2,599,538
Exercised (in shares)	(246,372)	(1,937,487)
Canceled/Forfeited (in shares)	(162,663)	(451,536)
Outstanding at end of period (in shares)	8,537,337	8,065,200
Exercisable at end of period (in shares)	5,081,221	3,370,968
Weighted Avg. Exercise Price
Outstanding at beginning of period (in dollars per share)	$ 18.73	$ 15.10
Granted (in dollars per share)	23.17	19.72
Exercised (in dollars per share)	13.44	5.00
Canceled/Forfeited (in dollars per share)	22.57	23.52
Outstanding at end of period (in dollars per share)	19.42	18.53
Exercisable at end of period (in dollars per share)	$ 17.79	$ 14.74
Weighted average remaining contractual life of options outstanding	6 years 3 months 18 days
Weighted average remaining contractual life of options exercisable	5 years
Options
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Expected option term (in years)	6 years 6 months
Expected volatility factor	31.00%
Weighted-average risk-free interest rate	1.99%
Expected dividend rate	0.00%

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Stock-Based Compensation - Nonvested Stock Unit Activity (Details) - $ / shares	9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Restricted Stock Units (RSUs)
Shares
Non-vested units beginning of period (in shares)	322,142	125,307
Granted (in shares)	248,199	276,943
Vested (in shares)	(101,103)	(42,144)
Canceled/Forfeited (in shares)	(30,729)	(29,036)
Non-vested units end of period (in shares)	438,509	331,070
Weighted Avg. Grant Date Fair Value
Non-vested units beginning of period (in dollars per share)	$ 20.59	$ 24.67
Granted (in dollars per share)	23.16	19.51
Vested (in dollars per share)	21.25	24.63
Canceled/Forfeited (in dollars per share)	22.48	21.99
Non-vested units end of period (in dollars per share)	$ 21.76	$ 20.59
Performance Shares (PSUs)
Shares
Non-vested units beginning of period (in shares)	259,930	49,136
Granted (in shares)	193,071	219,266
Vested (in shares)	0	0
Canceled/Forfeited (in shares)	0	(4,200)
Non-vested units end of period (in shares)	453,001	264,202
Weighted Avg. Grant Date Fair Value
Non-vested units beginning of period (in dollars per share)	$ 24.74	$ 28.57
Granted (in dollars per share)	26.58	23.95
Vested (in dollars per share)	0.00	0.00
Canceled/Forfeited (in dollars per share)	0.00	28.57
Non-vested units end of period (in dollars per share)	$ 25.53	$ 24.74

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Stock-Based Compensation - Performance Stock Units (Details)	9 Months Ended
	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected dividend rate	0.00%
Performance Shares (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected volatility factor	31.00%
Weighted-average risk-free interest rate	1.45%
Expected dividend rate	0.00%

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Business Segment Information - Narrative (Details)	9 Months Ended
	Dec. 31, 2017 segment
Segment Reporting [Abstract]
Number of business segments	2

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Business Segment Information - Schedule of Segment Reporting Information, By Segment (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Segment Reporting Information, Income (Loss) before Income Taxes [Abstract]
Net sales	$ 492.3	$ 451.8	$ 1,490.8	$ 1,414.6
Income (loss) from operations	63.2	32.8	184.2	123.9
Non-operating expense:
Interest expense, net	(18.7)	(22.9)	(58.9)	(69.4)
Loss on the extinguishment of debt	(11.9)	(7.8)	(11.9)	(7.8)
Other expense, net	(1.0)	(0.7)	(2.5)	(3.3)
Income (loss) before income taxes from operations	31.6	1.4	110.9	43.4
Benefit for income taxes	(50.0)	(1.8)	(27.0)	(3.3)
Net income	81.6	3.2	137.9	46.7
Dividends on preferred stock	(5.8)	(1.5)	(17.4)	(1.5)
Net income attributable to Rexnord common stockholders	75.8	1.7	120.5	45.2
Segment Reporting Information, Additional Information [Abstract]
Depreciation and amortization	21.7	25.8	65.3	79.1
Capital expenditures	9.2	15.1	25.1	44.0
Corporate
Segment Reporting Information, Income (Loss) before Income Taxes [Abstract]
Income (loss) from operations	(11.1)	(10.2)	(34.6)	(30.5)
Process & Motion Control
Segment Reporting Information, Income (Loss) before Income Taxes [Abstract]
Net sales	292.5	270.3	880.6	820.9
Segment Reporting Information, Additional Information [Abstract]
Depreciation and amortization	13.0	17.0	40.4	51.8
Capital expenditures	7.6	12.0	20.8	32.9
Process & Motion Control | Operating Segments
Segment Reporting Information, Income (Loss) before Income Taxes [Abstract]
Income (loss) from operations	48.5	28.6	132.9	91.3
Water Management
Segment Reporting Information, Income (Loss) before Income Taxes [Abstract]
Net sales	199.8	181.5	610.2	593.7
Segment Reporting Information, Additional Information [Abstract]
Depreciation and amortization	8.7	8.8	24.9	27.3
Capital expenditures	1.6	3.1	4.3	11.1
Water Management | Operating Segments
Segment Reporting Information, Income (Loss) before Income Taxes [Abstract]
Income (loss) from operations	$ 25.8	$ 14.4	$ 85.9	$ 63.1

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Guarantor Subsidiaries - Condensed Consolidating Balance Sheets (Details) - USD ($) $ in Millions	Dec. 31, 2017	Mar. 31, 2017	Dec. 31, 2016	Mar. 31, 2016
Current assets:
Cash and cash equivalents	$ 234.8	$ 490.1	$ 429.3	$ 484.6
Receivables, net	313.1	322.9
Inventories, net	349.9	314.9
Other current assets	57.1	50.2
Total current assets	954.9	1,178.1
Property, plant and equipment, net	389.3	400.9
Intangible assets, net	567.9	558.6
Goodwill	1,353.8	1,318.2
Investment in:
Other assets	84.1	83.5
Total assets	3,350.0	3,539.3
Current liabilities:
Current portion of long-term debt	0.2	16.5
Trade payables	199.6	197.8
Compensation and benefits	52.4	54.3
Current portion of pension and postretirement benefit obligations	4.4	4.3
Other current liabilities	126.7	127.4
Total current liabilities	383.3	400.3
Long-term debt	1,322.9	1,606.2
Note (receivable from) payable to affiliates, net	0.0	0.0
Pension and postretirement benefit obligations	170.9	174.4
Deferred income taxes	146.2	208.8
Other liabilities	72.6	79.0
Total liabilities	2,095.9	2,468.7
Total stockholders' equity	1,254.1	1,070.6
Total liabilities and stockholders' equity	3,350.0	3,539.3
Eliminations
Current assets:
Cash and cash equivalents	0.0	0.0	0.0	0.0
Receivables, net	0.0	0.0
Inventories, net	0.0	0.0
Other current assets	0.0	0.0
Total current assets	0.0	0.0
Property, plant and equipment, net	0.0	0.0
Intangible assets, net	0.0	0.0
Goodwill	0.0	0.0
Investment in:
Other assets		0.0
Total assets	(5,003.0)	(4,457.5)
Current liabilities:
Current portion of long-term debt	0.0	0.0
Trade payables	0.0	0.0
Compensation and benefits	0.0	0.0
Current portion of pension and postretirement benefit obligations	0.0	0.0
Other current liabilities	0.0	0.0
Total current liabilities	0.0	0.0
Long-term debt	0.0	0.0
Note (receivable from) payable to affiliates, net	0.0	0.0
Pension and postretirement benefit obligations	0.0	0.0
Deferred income taxes	0.0	0.0
Other liabilities	0.0	0.0
Total liabilities	0.0	0.0
Total stockholders' equity	(5,003.0)	(4,457.5)
Total liabilities and stockholders' equity	(5,003.0)	(4,457.5)
Eliminations, Issuer Subsidiaries
Investment in:
Subsidiaries	(1,215.9)	(1,020.1)
Eliminations, Guarantor Subsidiaries
Investment in:
Subsidiaries	(3,098.4)	(2,835.2)
Eliminations, Non-Guarantor Subsidiaries
Investment in:
Subsidiaries	(688.7)	(602.2)
Parent
Current assets:
Cash and cash equivalents	0.0	4.9	1.0	6.1
Receivables, net	0.0	0.0
Inventories, net	0.0	0.0
Other current assets	4.4	4.4
Total current assets	4.4	9.3
Property, plant and equipment, net	0.0	0.0
Intangible assets, net	0.0	0.0
Goodwill	0.0	0.0
Investment in:
Subsidiaries	1,215.9	1,020.1
Other assets	22.6	22.6
Total assets	1,242.9	1,052.0
Current liabilities:
Current portion of long-term debt	0.0	0.0
Trade payables	0.0	0.0
Compensation and benefits	0.0	0.0
Current portion of pension and postretirement benefit obligations	0.0	0.0
Other current liabilities	0.0	0.0
Total current liabilities	0.0	0.0
Long-term debt	0.0	0.0
Note (receivable from) payable to affiliates, net	(11.5)	(18.7)
Pension and postretirement benefit obligations	0.0	0.0
Deferred income taxes	0.0	0.0
Other liabilities	0.3	0.1
Total liabilities	(11.2)	(18.6)
Total stockholders' equity	1,254.1	1,070.6
Total liabilities and stockholders' equity	1,242.9	1,052.0
Issuers
Current assets:
Cash and cash equivalents	0.4	0.1	1.2	2.0
Receivables, net	0.0	0.0
Inventories, net	0.0	0.0
Other current assets	0.0	0.0
Total current assets	0.4	0.1
Property, plant and equipment, net	0.0	0.0
Intangible assets, net	0.0	0.0
Goodwill	0.0	0.0
Investment in:
Subsidiaries	3,098.4	2,835.2
Other assets	1.4	1.8
Total assets	3,100.2	2,837.1
Current liabilities:
Current portion of long-term debt	0.0	16.1
Trade payables	0.7	0.0
Compensation and benefits	0.0	0.0
Current portion of pension and postretirement benefit obligations	0.0	0.0
Other current liabilities	5.8	5.7
Total current liabilities	6.5	21.8
Long-term debt	1,285.3	1,568.4
Note (receivable from) payable to affiliates, net	588.3	215.5
Pension and postretirement benefit obligations	0.0	0.0
Deferred income taxes	4.1	1.0
Other liabilities	0.1	10.3
Total liabilities	1,884.3	1,817.0
Total stockholders' equity	1,215.9	1,020.1
Total liabilities and stockholders' equity	3,100.2	2,837.1
Guarantor Subsidiaries
Current assets:
Cash and cash equivalents	41.3	253.3	204.7	290.1
Receivables, net	176.7	191.3
Inventories, net	227.6	223.8
Other current assets	17.2	11.0
Total current assets	462.8	679.4
Property, plant and equipment, net	239.7	255.3
Intangible assets, net	450.1	441.9
Goodwill	1,022.8	996.8
Investment in:
Subsidiaries	688.7	602.2
Other assets	47.9	46.8
Total assets	2,912.0	3,022.4
Current liabilities:
Current portion of long-term debt	0.2	0.4
Trade payables	120.1	120.3
Compensation and benefits	30.1	32.4
Current portion of pension and postretirement benefit obligations	2.5	2.4
Other current liabilities	74.8	76.4
Total current liabilities	227.7	231.9
Long-term debt	37.4	37.7
Note (receivable from) payable to affiliates, net	(741.0)	(442.2)
Pension and postretirement benefit obligations	118.5	124.6
Deferred income taxes	108.4	175.7
Other liabilities	62.6	59.5
Total liabilities	(186.4)	187.2
Total stockholders' equity	3,098.4	2,835.2
Total liabilities and stockholders' equity	2,912.0	3,022.4
Non-Guarantor Subsidiaries
Current assets:
Cash and cash equivalents	193.1	231.8	$ 222.4	$ 186.4
Receivables, net	136.4	131.6
Inventories, net	122.3	91.1
Other current assets	35.5	34.8
Total current assets	487.3	489.3
Property, plant and equipment, net	149.6	145.6
Intangible assets, net	117.8	116.7
Goodwill	331.0	321.4
Investment in:
Other assets	12.2	12.3
Total assets	1,097.9	1,085.3
Current liabilities:
Current portion of long-term debt	0.0	0.0
Trade payables	78.8	77.5
Compensation and benefits	22.3	21.9
Current portion of pension and postretirement benefit obligations	1.9	1.9
Other current liabilities	46.1	45.3
Total current liabilities	149.1	146.6
Long-term debt	0.2	0.1
Note (receivable from) payable to affiliates, net	164.2	245.4
Pension and postretirement benefit obligations	52.4	49.8
Deferred income taxes	33.7	32.1
Other liabilities	9.6	9.1
Total liabilities	409.2	483.1
Total stockholders' equity	688.7	602.2
Total liabilities and stockholders' equity	$ 1,097.9	$ 1,085.3

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Guarantor Subsidiaries - Condensed Consolidating Statements of Operations (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Condensed Income Statements, Captions [Line Items]
Net sales	$ 492.3	$ 451.8	$ 1,490.8	$ 1,414.6
Cost of sales	309.4	298.8	943.6	922.2
Gross profit	182.9	153.0	547.2	492.4
Selling, general and administrative expenses	107.3	99.9	326.6	313.1
Restructuring and other similar charges	3.8	11.7	11.6	21.7
Amortization of intangible assets	8.6	8.6	24.8	33.7
Income from operations	63.2	32.8	184.2	123.9
Interest income (expense), net:
To third parties	(18.7)	(22.9)	(58.9)	(69.4)
To affiliates	0.0	0.0	0.0	0.0
Loss on extinguishment of debt	(11.9)	(7.8)	(11.9)	(7.8)
Other (expense) income, net	(1.0)	(0.7)	(2.5)	(3.3)
Income (loss) before income taxes from operations	31.6	1.4	110.9	43.4
Provision (benefit) for income taxes	(50.0)	(1.8)	(27.0)	(3.3)
Income (loss) before equity in income of subsidiaries	81.6	3.2	137.9	46.7
Equity in earnings (loss) of subsidiaries	0.0	0.0	0.0	0.0
Net income	81.6	3.2	137.9	46.7
Dividends on preferred stock	5.8	1.5	17.4	1.5
Net income attributable to Rexnord common stockholders	75.8	1.7	120.5	45.2
Comprehensive income (loss)	89.4	(27.3)	182.1	18.0
Eliminations
Condensed Income Statements, Captions [Line Items]
Net sales	(77.3)	(56.0)	(221.0)	(174.5)
Cost of sales	(77.3)	(56.0)	(221.0)	(174.5)
Gross profit	0.0	0.0	0.0	0.0
Selling, general and administrative expenses	0.0	0.0	0.0	0.0
Restructuring and other similar charges	0.0	0.0	0.0	0.0
Amortization of intangible assets	0.0	0.0	0.0	0.0
Income from operations	0.0	0.0	0.0	0.0
Interest income (expense), net:
To third parties	0.0	0.0	0.0	0.0
To affiliates	0.0	0.0	0.0	0.0
Loss on extinguishment of debt	0.0	0.0	0.0	0.0
Other (expense) income, net	0.0	0.0	0.0	0.0
Income (loss) before income taxes from operations	0.0	0.0	0.0	0.0
Provision (benefit) for income taxes	0.0	0.0	0.0	0.0
Income (loss) before equity in income of subsidiaries	0.0	0.0	0.0	0.0
Equity in earnings (loss) of subsidiaries	(197.7)	(19.9)	(342.0)	(115.5)
Net income	(197.7)	(19.9)	(342.0)	(115.5)
Dividends on preferred stock	0.0	0.0	0.0	0.0
Net income attributable to Rexnord common stockholders	(197.7)	(19.9)	(342.0)	(115.5)
Comprehensive income (loss)	(197.7)	(19.9)	(342.0)	(115.5)
Parent
Condensed Income Statements, Captions [Line Items]
Net sales	0.0	0.0	0.0	0.0
Cost of sales	0.0	0.0	0.0	0.0
Gross profit	0.0	0.0	0.0	0.0
Selling, general and administrative expenses	0.0	0.0	0.0	0.0
Restructuring and other similar charges	0.0	0.0	0.0	0.0
Amortization of intangible assets	0.0	0.0	0.0	0.0
Income from operations	0.0	0.0	0.0	0.0
Interest income (expense), net:
To third parties	0.0	0.0	0.0	0.0
To affiliates	0.7	0.2	2.4	0.2
Loss on extinguishment of debt	0.0	0.0	0.0	0.0
Other (expense) income, net	0.0	0.0	0.0	0.0
Income (loss) before income taxes from operations	0.7	0.2	2.4	0.2
Provision (benefit) for income taxes	0.0	0.0	0.0	0.0
Income (loss) before equity in income of subsidiaries	0.7	0.2	2.4	0.2
Equity in earnings (loss) of subsidiaries	80.9	3.0	135.5	46.5
Net income	81.6	3.2	137.9	46.7
Dividends on preferred stock	5.8	1.5	17.4	1.5
Net income attributable to Rexnord common stockholders	75.8	1.7	120.5	45.2
Comprehensive income (loss)	81.6	3.2	137.9	46.7
Issuers
Condensed Income Statements, Captions [Line Items]
Net sales	0.0	0.0	0.0	0.0
Cost of sales	0.0	0.0	0.0	0.0
Gross profit	0.0	0.0	0.0	0.0
Selling, general and administrative expenses	0.0	0.0	0.0	0.0
Restructuring and other similar charges	0.0	0.0	0.0	0.0
Amortization of intangible assets	0.0	0.0	0.0	0.0
Income from operations	0.0	0.0	0.0	0.0
Interest income (expense), net:
To third parties	(18.7)	(22.8)	(59.3)	(68.8)
To affiliates	6.7	16.4	19.8	58.4
Loss on extinguishment of debt	(11.9)	(7.8)	(11.9)	(7.8)
Other (expense) income, net	(0.1)	0.0	0.0	(0.5)
Income (loss) before income taxes from operations	(24.0)	(14.2)	(51.4)	(18.7)
Provision (benefit) for income taxes	0.0	0.0	0.0	0.1
Income (loss) before equity in income of subsidiaries	(24.0)	(14.2)	(51.4)	(18.8)
Equity in earnings (loss) of subsidiaries	104.9	17.2	186.9	65.3
Net income	80.9	3.0	135.5	46.5
Dividends on preferred stock	0.0	0.0	0.0	0.0
Net income attributable to Rexnord common stockholders	80.9	3.0	135.5	46.5
Comprehensive income (loss)	83.3	0.3	147.1	46.4
Guarantor Subsidiaries
Condensed Income Statements, Captions [Line Items]
Net sales	358.7	331.4	1,092.4	1,043.6
Cost of sales	226.3	217.9	684.8	682.5
Gross profit	132.4	113.5	407.6	361.1
Selling, general and administrative expenses	76.1	70.5	231.1	224.0
Restructuring and other similar charges	3.2	10.9	8.3	18.5
Amortization of intangible assets	7.0	7.0	20.0	28.7
Income from operations	46.1	25.1	148.2	89.9
Interest income (expense), net:
To third parties	0.1	(0.1)	0.4	(0.5)
To affiliates	(6.1)	(13.7)	(18.2)	(40.1)
Loss on extinguishment of debt	0.0	0.0	0.0	0.0
Other (expense) income, net	(2.5)	(0.3)	(4.7)	(1.9)
Income (loss) before income taxes from operations	37.6	11.0	125.7	47.4
Provision (benefit) for income taxes	(55.4)	(6.5)	(41.6)	(14.2)
Income (loss) before equity in income of subsidiaries	93.0	17.5	167.3	61.6
Equity in earnings (loss) of subsidiaries	11.9	(0.3)	19.6	3.7
Net income	104.9	17.2	186.9	65.3
Dividends on preferred stock	0.0	0.0	0.0	0.0
Net income attributable to Rexnord common stockholders	104.9	17.2	186.9	65.3
Comprehensive income (loss)	104.8	5.5	189.4	47.7
Non-Guarantor Subsidiaries
Condensed Income Statements, Captions [Line Items]
Net sales	210.9	176.4	619.4	545.5
Cost of sales	160.4	136.9	479.8	414.2
Gross profit	50.5	39.5	139.6	131.3
Selling, general and administrative expenses	31.2	29.4	95.5	89.1
Restructuring and other similar charges	0.6	0.8	3.3	3.2
Amortization of intangible assets	1.6	1.6	4.8	5.0
Income from operations	17.1	7.7	36.0	34.0
Interest income (expense), net:
To third parties	(0.1)	0.0	0.0	(0.1)
To affiliates	(1.3)	(2.9)	(4.0)	(18.5)
Loss on extinguishment of debt	0.0	0.0	0.0	0.0
Other (expense) income, net	1.6	(0.4)	2.2	(0.9)
Income (loss) before income taxes from operations	17.3	4.4	34.2	14.5
Provision (benefit) for income taxes	5.4	4.7	14.6	10.8
Income (loss) before equity in income of subsidiaries	11.9	(0.3)	19.6	3.7
Equity in earnings (loss) of subsidiaries	0.0	0.0	0.0	0.0
Net income	11.9	(0.3)	19.6	3.7
Dividends on preferred stock	0.0	0.0	0.0	0.0
Net income attributable to Rexnord common stockholders	11.9	(0.3)	19.6	3.7
Comprehensive income (loss)	$ 17.4	$ (16.4)	$ 49.7	$ (7.3)

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Guarantor Subsidiaries - Condensed Consolidating Statements of Cash Flows (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Mar. 31, 2017
Operating activities
Cash provided by (used for) operating activities			$ 121.9	$ 122.1
Investing activities
Expenditures for property, plant and equipment	$ (9.2)	$ (15.1)	(25.1)	(44.0)
Acquisitions, net of cash			(50.0)	(213.7)
Proceeds from dispositions of property, plant and equipment			5.5	1.9
Cash used for investing activities			(69.6)	(255.8)
Financing activities
Proceeds from borrowings of long-term debt			1,325.0	1,590.3
Repayments of long-term debt			(1,603.2)	(1,881.8)
Proceeds from borrowings of short-term debt			0.0	16.1
Repayments of short-term debt			(24.3)	(19.5)
Payment of debt issuance costs			(9.0)	(10.6)
Proceeds from issuance of preferred stock, net of direct offering costs			0.0	390.2
Proceeds from exercise of stock options			2.9	9.6
Proceeds from financing lease obligation			5.8	0.0
Payments of dividend on preferred stock			(17.4)	0.0
Deferred acquisition payment			0.0	(5.7)
Cash (used for) provided by financing activities			(320.2)	88.6
Effect of exchange rate changes on cash and cash equivalents			12.6	(10.2)
(Decrease) increase in cash and cash equivalents			(255.3)	(55.3)
Cash and cash equivalents at beginning of period			490.1	484.6	$ 484.6
Cash and cash equivalents at end of period	234.8	429.3	234.8	429.3	490.1
Eliminations
Operating activities
Cash provided by (used for) operating activities			0.0	0.0
Investing activities
Expenditures for property, plant and equipment			0.0	0.0
Acquisitions, net of cash			0.0	0.0
Proceeds from dispositions of property, plant and equipment			0.0	0.0
Cash used for investing activities			0.0	0.0
Financing activities
Proceeds from borrowings of long-term debt			0.0	0.0
Repayments of long-term debt			0.0	0.0
Proceeds from borrowings of short-term debt				0.0
Repayments of short-term debt			0.0	0.0
Payment of debt issuance costs			0.0	0.0
Proceeds from issuance of preferred stock, net of direct offering costs				0.0
Proceeds from exercise of stock options			0.0	0.0
Proceeds from financing lease obligation			0.0
Payments of dividend on preferred stock			0.0
Deferred acquisition payment				0.0
Cash (used for) provided by financing activities			0.0	0.0
Effect of exchange rate changes on cash and cash equivalents			0.0	0.0
(Decrease) increase in cash and cash equivalents			0.0	0.0
Cash and cash equivalents at beginning of period			0.0	0.0	0.0
Cash and cash equivalents at end of period	0.0	0.0	0.0	0.0	0.0
Parent
Operating activities
Cash provided by (used for) operating activities			9.6	(404.9)
Investing activities
Expenditures for property, plant and equipment			0.0	0.0
Acquisitions, net of cash			0.0	0.0
Proceeds from dispositions of property, plant and equipment			0.0	0.0
Cash used for investing activities			0.0	0.0
Financing activities
Proceeds from borrowings of long-term debt			0.0	0.0
Repayments of long-term debt			0.0	0.0
Proceeds from borrowings of short-term debt				0.0
Repayments of short-term debt			0.0	0.0
Payment of debt issuance costs			0.0	0.0
Proceeds from issuance of preferred stock, net of direct offering costs				390.2
Proceeds from exercise of stock options			2.9	9.6
Proceeds from financing lease obligation			0.0
Payments of dividend on preferred stock			(17.4)
Deferred acquisition payment				0.0
Cash (used for) provided by financing activities			(14.5)	399.8
Effect of exchange rate changes on cash and cash equivalents			0.0	0.0
(Decrease) increase in cash and cash equivalents			(4.9)	(5.1)
Cash and cash equivalents at beginning of period			4.9	6.1	6.1
Cash and cash equivalents at end of period	0.0	1.0	0.0	1.0	4.9
Issuer
Operating activities
Cash provided by (used for) operating activities			311.8	304.7
Investing activities
Expenditures for property, plant and equipment			0.0	0.0
Acquisitions, net of cash			0.0	0.0
Proceeds from dispositions of property, plant and equipment			0.0	0.0
Cash used for investing activities			0.0	0.0
Financing activities
Proceeds from borrowings of long-term debt			1,325.0	1,590.3
Repayments of long-term debt			(1,603.2)	(1,881.8)
Proceeds from borrowings of short-term debt				16.1
Repayments of short-term debt			(24.3)	(19.5)
Payment of debt issuance costs			(9.0)	(10.6)
Proceeds from issuance of preferred stock, net of direct offering costs				0.0
Proceeds from exercise of stock options			0.0	0.0
Proceeds from financing lease obligation			0.0
Payments of dividend on preferred stock			0.0
Deferred acquisition payment				0.0
Cash (used for) provided by financing activities			(311.5)	(305.5)
Effect of exchange rate changes on cash and cash equivalents			0.0	0.0
(Decrease) increase in cash and cash equivalents			0.3	(0.8)
Cash and cash equivalents at beginning of period			0.1	2.0	2.0
Cash and cash equivalents at end of period	0.4	1.2	0.4	1.2	0.1
Guarantor Subsidiaries
Operating activities
Cash provided by (used for) operating activities			(154.8)	161.2
Investing activities
Expenditures for property, plant and equipment			(18.2)	(35.1)
Acquisitions, net of cash			(50.0)	(213.4)
Proceeds from dispositions of property, plant and equipment			5.2	1.9
Cash used for investing activities			(63.0)	(246.6)
Financing activities
Proceeds from borrowings of long-term debt			0.0	0.0
Repayments of long-term debt			0.0	0.0
Proceeds from borrowings of short-term debt				0.0
Repayments of short-term debt			0.0	0.0
Payment of debt issuance costs			0.0	0.0
Proceeds from issuance of preferred stock, net of direct offering costs				0.0
Proceeds from exercise of stock options			0.0	0.0
Proceeds from financing lease obligation			5.8
Payments of dividend on preferred stock			0.0
Deferred acquisition payment				0.0
Cash (used for) provided by financing activities			5.8	0.0
Effect of exchange rate changes on cash and cash equivalents			0.0	0.0
(Decrease) increase in cash and cash equivalents			(212.0)	(85.4)
Cash and cash equivalents at beginning of period			253.3	290.1	290.1
Cash and cash equivalents at end of period	41.3	204.7	41.3	204.7	253.3
Non-Guarantor Subsidiaries
Operating activities
Cash provided by (used for) operating activities			(44.7)	61.1
Investing activities
Expenditures for property, plant and equipment			(6.9)	(8.9)
Acquisitions, net of cash			0.0	(0.3)
Proceeds from dispositions of property, plant and equipment			0.3	0.0
Cash used for investing activities			(6.6)	(9.2)
Financing activities
Proceeds from borrowings of long-term debt			0.0	0.0
Repayments of long-term debt			0.0	0.0
Proceeds from borrowings of short-term debt				0.0
Repayments of short-term debt			0.0	0.0
Payment of debt issuance costs			0.0	0.0
Proceeds from issuance of preferred stock, net of direct offering costs				0.0
Proceeds from exercise of stock options			0.0	0.0
Proceeds from financing lease obligation			0.0
Payments of dividend on preferred stock			0.0
Deferred acquisition payment				(5.7)
Cash (used for) provided by financing activities			0.0	(5.7)
Effect of exchange rate changes on cash and cash equivalents			12.6	(10.2)
(Decrease) increase in cash and cash equivalents			(38.7)	36.0
Cash and cash equivalents at beginning of period			231.8	186.4	186.4
Cash and cash equivalents at end of period	$ 193.1	$ 222.4	$ 193.1	$ 222.4	$ 231.8