QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or Other Jurisdiction of Incorporation or Organization) |
(I.R.S. Employer Identification No.) |
Title of Each Class |
Trading Symbol |
Name of Each Exchange on Which Registered |
☒ |
Accelerated filer |
☐ |
|
Non-accelerated filer |
☐ |
Smaller reporting company |
|
Emerging growth Company |
Page No. |
|
PART I. FINANCIAL INFORMATION |
|
6 |
|
39 |
|
58 |
|
58 |
|
PART II. OTHER INFORMATION |
|
59 |
|
59 |
|
60 |
|
61 |
|
61 |
|
61 |
|
61 |
|
61 |
• | We have exposure to the risks associated with instability in the global economy and financial markets, which may negatively impact our revenues, liquidity, suppliers and customers. |
• | More than half of our sales and operations are in non-U.S. jurisdictions and we are subject to the economic, political, regulatory and other risks of international operations. |
• | Our revenues and operating results, especially in the Energy segment, depend on the level of activity in the energy industry, which is significantly affected by volatile oil and gas prices. |
• | Our results of operations are subject to exchange rate and other currency risks. A significant movement in exchange rates could adversely impact our results of operations and cash flows. |
• | Potential governmental regulations restricting the use, and increased public attention to and litigation regarding the impacts, of hydraulic fracturing or other processes on which it relies could reduce demand for our products. |
• | We face competition in the markets we serve, which could materially and adversely affect our operating results. |
• | Large or rapid increases in the cost of raw materials and component parts, substantial decreases in their availability or our dependence on particular suppliers of raw materials and component parts could materially and adversely affect our operating results. |
• | Our operating results could be adversely affected by a loss or reduction of business with key customers or consolidation or the vertical integration of our customer base. |
• | Credit and counterparty risks could harm our business. |
• | Acquisitions and integrating such acquisitions create certain risks and may affect our operating results. |
• | The loss of, or disruption in, our distribution network could have a negative impact on our abilities to ship products, meet customer demand and otherwise operate our business. |
• | Our ongoing and expected restructuring plans and other cost savings initiatives may not be as effective as we anticipate, and we may fail to realize the cost savings and increased efficiencies that we expect to result from these actions. Our operating results could be negatively affected by our inability to effectively implement such restructuring plans and other cost savings initiatives. |
• | Our success depends on our executive management and other key personnel and our ability to attract and retain top talent throughout the Company. |
• | If we are unable to develop new products and technologies, our competitive position may be impaired, which could materially and adversely affect our sales and market share. |
• | Cost overruns, delays, penalties or liquidated damages could negatively impact our results, particularly with respect to fixed-price contracts for custom engineered products. |
• | The risk of non-compliance with U.S. and foreign laws and regulations applicable to our international operations could have a significant impact on our results of operations, financial condition or strategic objectives. |
• | Changes in tax or other laws, regulations, or adverse determinations by taxing or other governmental authorities could increase our effective tax rate and cash taxes paid or otherwise affect our financial condition or operating results. |
• | A significant portion of our assets consists of goodwill and other intangible assets, the value of which may be reduced if we determine that those assets are impaired. |
• | Our business could suffer if we experience employee work stoppages, union and work council campaigns or other labor difficulties. |
• | We are a defendant in certain asbestos and silica-related personal injury lawsuits, which could adversely affect our financial condition. |
• | A natural disaster, catastrophe or other event could result in severe property damage, which could adversely affect our operations. |
• | Information systems failure may disrupt our business and result in financial loss and liability to our customers. |
• | The nature of our products creates the possibility of significant product liability and warranty claims, which could harm our business. |
• | Environmental compliance costs and liabilities could adversely affect our financial condition. |
• | Third parties may infringe upon our intellectual property or may claim we have infringed their intellectual property, and we may expend significant resources enforcing or defending our rights or suffer competitive injury. |
• | We face risks associated with our pension and other postretirement benefit obligations. |
• | Our substantial indebtedness could have important adverse consequences and adversely affect our financial condition. |
• | We may not be able to generate sufficient cash to service all of our indebtedness, and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful. |
• | Despite our level of indebtedness, we and our subsidiaries may still be able to incur substantially more debt, including off-balance sheet financing, contractual obligations and general and commercial liabilities. This could further exacerbate the risks to our financial condition described above. |
• | The terms of the credit agreement governing the Senior Secured Credit Facilities may restrict our current and future operations, particularly our ability to respond to changes or to take certain actions. |
• | Our variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly. |
• | We utilize derivative financial instruments to reduce our exposure to market risks from changes in interest rates on our variable rate indebtedness and we will be exposed to risks related to counterparty credit worthiness or non-performance of these instruments. |
• | If the financial institutions that are part of the syndicate of our Revolving Credit Facility fail to extend credit under our facility or reduce the borrowing base under our Revolving Credit Facility, our liquidity and results of operations may be adversely affected. |
PART I. | FINANCIAL INFORMATION |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Revenues |
$ |
$ |
$ |
$ |
||||||||||||
Cost of sales |
||||||||||||||||
Gross Profit |
||||||||||||||||
Selling and administrative expenses |
||||||||||||||||
Amortization of intangible assets |
||||||||||||||||
Other operating expense, net |
||||||||||||||||
Operating Income |
||||||||||||||||
Interest expense |
||||||||||||||||
Loss on extinguishment of debt |
||||||||||||||||
Other income, net |
( |
) |
( |
) |
( |
) |
( |
) |
||||||||
Income Before Income Taxes |
||||||||||||||||
Provision for income taxes |
||||||||||||||||
Net Income |
$ |
$ |
$ |
$ |
||||||||||||
Basic earnings per share |
$ |
$ |
$ |
$ |
||||||||||||
Diluted earnings per share |
$ |
$ |
$ |
$ |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Net income |
$ |
$ |
$ |
$ |
||||||||||||
Other comprehensive loss, net of tax: |
||||||||||||||||
Foreign currency translation adjustments, net |
( |
) |
( |
) |
( |
) |
( |
) |
||||||||
Unrecognized (losses) gains on cash flow hedges, net |
( |
) |
||||||||||||||
Pension and other postretirement prior service cost and gain or loss, net |
||||||||||||||||
Total other comprehensive loss, net of tax |
( |
) |
( |
) |
( |
) |
( |
) |
||||||||
Total Comprehensive Income |
$ |
$ |
$ |
$ |
June 30, 2019 |
December 31, 2018 |
|||||||
Assets |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ |
$ |
||||||
Accounts receivable, net of allowance for doubtful accounts of $ |
||||||||
Inventories |
||||||||
Other current assets |
||||||||
Total current assets |
||||||||
Property, plant and equipment, net of accumulated depreciation of $ |
||||||||
Goodwill |
||||||||
Other intangible assets, net |
||||||||
Deferred tax assets |
||||||||
Other assets |
||||||||
Total assets |
$ |
$ |
||||||
Liabilities and Stockholders’ Equity |
||||||||
Current liabilities: |
||||||||
Short-term borrowings and current maturities of long-term debt |
$ |
$ |
||||||
Accounts payable |
||||||||
Accrued liabilities |
||||||||
Total current liabilities |
||||||||
Long-term debt, less current maturities |
||||||||
Pensions and other postretirement benefits |
||||||||
Deferred income taxes |
||||||||
Other liabilities |
||||||||
Total liabilities |
||||||||
Commitments and contingencies (Note 16) |
||||||||
Stockholders’ equity: |
||||||||
Common stock, $ |
||||||||
Capital in excess of par value |
||||||||
Accumulated deficit |
( |
) |
( |
) |
||||
Accumulated other comprehensive loss |
( |
) |
( |
) |
||||
Treasury stock at cost; |
( |
) |
( |
) |
||||
Total stockholders’ equity |
||||||||
Total liabilities and stockholders’ equity |
$ |
$ |
For the Three Month Period Ended June 30, |
||||||||
2019 |
2018 |
|||||||
Number of Common Shares Issued (in millions) |
||||||||
Balance at beginning of period |
||||||||
Issuance of common stock for stock-based compensation plans |
||||||||
Balance at end of period |
||||||||
Common Stock |
||||||||
Balance at beginning of period |
$ |
$ |
||||||
Issuance of common stock for stock-based compensation plans |
||||||||
Balance at end of period |
$ |
$ |
||||||
Capital in Excess of Par Value |
||||||||
Balance at beginning of period |
$ |
$ |
||||||
Issuance of common stock for stock-based compensation plans |
||||||||
Issuance of treasury stock for stock-based compensation plans |
( |
) |
( |
) |
||||
Stock-based compensation |
||||||||
Balance at end of period |
$ |
$ |
||||||
Accumulated Deficit |
||||||||
Balance at beginning of period |
$ |
( |
) |
$ |
( |
) |
||
Net income |
||||||||
Balance at end of period |
$ |
( |
) |
$ |
( |
) |
||
Accumulated Other Comprehensive Loss |
||||||||
Balance at beginning of period |
$ |
( |
) |
$ |
( |
) |
||
Foreign currency translation adjustments, net |
( |
) |
( |
) |
||||
Unrecognized gains on cash flow hedges, net |
( |
) |
||||||
Pension and other postretirement prior service cost and gain or loss, net |
||||||||
Balance at end of period |
$ |
( |
) |
$ |
( |
) |
||
Treasury Stock |
||||||||
Balance at beginning of period |
$ |
( |
) |
$ |
( |
) |
||
Purchases of treasury stock |
( |
) |
( |
) |
||||
Issuance of treasury stock for stock-based compensation plans |
||||||||
Balance at end of period |
$ |
( |
) |
$ |
( |
) |
||
Total Stockholders’ Equity |
$ |
$ |
For the Six Month Period Ended June 30, |
||||||||
2019 |
2018 |
|||||||
Number of Common Shares Issued (in millions) |
||||||||
Balance at beginning of period |
||||||||
Issuance of common stock for stock-based compensation plans |
||||||||
Balance at end of period |
||||||||
Common Stock |
||||||||
Balance at beginning of period |
$ |
$ |
||||||
Issuance of common stock for stock-based compensation plans |
||||||||
Balance at end of period |
$ |
$ |
||||||
Capital in Excess of Par Value |
||||||||
Balance at beginning of period |
$ |
$ |
||||||
Issuance of common stock for stock-based compensation plans |
||||||||
Issuance of treasury stock for stock-based compensation plans |
( |
) |
( |
) |
||||
Stock-based compensation |
||||||||
Balance at end of period |
$ |
$ |
||||||
Accumulated Deficit |
||||||||
Balance at beginning of period |
$ |
( |
) |
$ |
( |
) |
||
Net income |
||||||||
Cumulative-effect adjustment upon adoption of new accounting standard (ASU 2017-12) |
( |
) |
||||||
Cumulative-effect adjustment upon adoption of new accounting standard (ASU 2018-02) |
||||||||
Balance at end of period |
$ |
( |
) |
$ |
( |
) |
||
Accumulated Other Comprehensive Loss |
||||||||
Balance at beginning of period |
$ |
( |
) |
$ |
( |
) |
||
Foreign currency translation adjustments, net |
( |
) |
( |
) |
||||
Unrecognized gains on cash flow hedges, net |
||||||||
Pension and other postretirement prior service cost and gain or loss, net |
||||||||
Cumulative-effect adjustment upon adoption of new accounting standard (ASU 2017-12) |
||||||||
Cumulative-effect adjustment upon adoption of new accounting standard (ASU 2018-02) |
( |
) |
||||||
Balance at end of period |
$ |
( |
) |
$ |
( |
) |
||
Treasury Stock |
||||||||
Balance at beginning of period |
$ |
( |
) |
$ |
( |
) |
||
Purchases of treasury stock |
( |
) |
( |
) |
||||
Issuance of treasury stock for stock-based compensation plans |
||||||||
Balance at end of period |
$ |
( |
) |
$ |
( |
) |
||
Total Stockholders’ Equity |
$ |
$ |
For the Six Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2018 |
|||||||
Cash Flows From Operating Activities: |
||||||||
Net income |
$ |
$ |
||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
Amortization of intangible assets |
||||||||
Depreciation in cost of sales |
||||||||
Depreciation in selling and administrative expenses |
||||||||
Stock-based compensation expense |
||||||||
Foreign currency transaction losses, net |
||||||||
Net gain on asset dispositions |
( |
) |
( |
) |
||||
Loss on extinguishment of debt |
||||||||
Deferred income taxes |
||||||||
Changes in assets and liabilities: |
||||||||
Receivables |
||||||||
Inventories |
( |
) |
( |
) |
||||
Accounts payable |
( |
) |
||||||
Accrued liabilities |
( |
) |
( |
) |
||||
Other assets and liabilities, net |
( |
) |
( |
) |
||||
Net cash provided by operating activities |
||||||||
Cash Flows From Investing Activities: |
||||||||
Capital expenditures |
( |
) |
( |
) |
||||
Net cash paid in business combinations |
( |
) |
( |
) |
||||
Disposals of property, plant and equipment |
||||||||
Net cash used in investing activities |
( |
) |
( |
) |
||||
Cash Flows From Financing Activities: |
||||||||
Principal payments on long-term debt |
( |
) |
( |
) |
||||
Purchases of treasury stock |
( |
) |
( |
) |
||||
Proceeds from stock option exercises |
||||||||
Payments of contingent consideration |
( |
) |
||||||
Payments of debt issuance costs |
( |
) |
||||||
Net cash used in financing activities |
( |
) |
( |
) |
||||
Effect of exchange rate changes on cash and cash equivalents |
( |
) |
||||||
Net increase (decrease) in cash and cash equivalents |
( |
) |
||||||
Cash and cash equivalents, beginning of period |
||||||||
Cash and cash equivalents, end of period |
$ |
$ |
||||||
Supplemental Cash Flow Information |
||||||||
Cash paid for income taxes |
$ |
$ |
||||||
Cash paid for interest |
$ |
$ |
||||||
Debt issuance costs in accounts payable |
$ |
$ |
||||||
Debt issuance costs in accrued liabilities |
$ |
$ |
||||||
Capital expenditures in accounts payable |
$ |
$ |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Revenue |
$ |
$ |
$ |
$ |
||||||||||||
Operating income (loss) |
( |
) |
( |
) |
Total |
||||
Balance as of December 31, 2018 |
$ |
|||
Charged to expense - Termination benefits |
||||
Charged to expense - Other |
||||
Payments |
( |
) |
||
Other, net |
( |
) |
||
Balance as of June 30, 2019 |
$ |
June 30, 2019 |
December 31, 2018 |
|||||||
Raw materials, including parts and subassemblies |
$ |
$ |
||||||
Work-in-process |
||||||||
Finished goods |
||||||||
Excess of LIFO costs over FIFO costs |
||||||||
Inventories |
$ |
$ |
Industrials |
Energy |
Medical |
Total |
|||||||||||||
Balance as of December 31, 2018 |
$ |
$ |
$ |
$ |
||||||||||||
Foreign currency translation and other (1) |
( |
) |
( |
) |
( |
) |
( |
) |
||||||||
Balance as of June 30, 2019 |
$ |
$ |
$ |
$ |
(1) |
June 30, 2019 |
December 31, 2018 |
|||||||||||||||
Gross Carrying Amount |
Accumulated Amortization |
Gross Carrying Amount |
Accumulated Amortization |
|||||||||||||
Amortized intangible assets |
||||||||||||||||
Customer lists and relationships |
$ |
$ |
( |
) |
$ |
$ |
( |
) |
||||||||
Technology |
( |
) |
( |
) |
||||||||||||
Trademarks |
( |
) |
( |
) |
||||||||||||
Backlog |
( |
) |
( |
) |
||||||||||||
Other |
( |
) |
( |
) |
||||||||||||
Unamortized intangible assets |
||||||||||||||||
Trademarks |
— |
— |
||||||||||||||
Total other intangible assets |
$ |
$ |
( |
) |
$ |
$ |
( |
) |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Intangible asset amortization expense |
$ |
$ |
$ |
$ |
June 30, 2019 |
December 31, 2018 |
|||||||
Salaries, wages and related fringe benefits |
$ |
$ |
||||||
Restructuring |
||||||||
Taxes |
||||||||
Contract liabilities |
||||||||
Product warranty |
||||||||
Accrued interest |
||||||||
Operating lease liabilities(1) |
||||||||
Other |
||||||||
Total accrued liabilities |
$ |
$ |
(1) |
For the Three Month Period Ended June 30, 2019 |
For the Three Month Period Ended June 30, 2018 |
For the Six Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2018 |
|||||||||||||
Balance at beginning of period |
$ |
$ |
$ |
$ |
||||||||||||
Product warranty accruals |
||||||||||||||||
Settlements |
( |
) |
( |
) |
( |
) |
( |
) |
||||||||
Charged to other accounts(1) |
( |
) |
||||||||||||||
Balance at end of period |
$ |
$ |
$ |
$ |
(1) |
Pension Benefits |
Other Postretirement |
|||||||||||||||||||||||
U.S. Plans |
Non-U.S. Plans |
Benefits |
||||||||||||||||||||||
For the Three Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2019 |
For the Three Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2019 |
For the Three Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2019 |
|||||||||||||||||||
Service cost |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||
Interest cost |
||||||||||||||||||||||||
Expected return on plan assets |
( |
) |
( |
) |
( |
) |
( |
) |
||||||||||||||||
Recognition of: |
||||||||||||||||||||||||
Unrecognized prior service cost |
||||||||||||||||||||||||
Unrecognized net actuarial loss |
||||||||||||||||||||||||
$ |
$ |
$ |
$ |
$ |
$ |
Pension Benefits |
Other Postretirement |
|||||||||||||||||||||||
U.S. Plans |
Non-U.S. Plans |
Benefits |
||||||||||||||||||||||
For the Three Month Period Ended June 30, 2018 |
For the Six Month Period Ended June 30, 2018 |
For the Three Month Period Ended June 30, 2018 |
For the Six Month Period Ended June 30, 2018 |
For the Three Month Period Ended June 30, 2018 |
For the Six Month Period Ended June 30, 2018 |
|||||||||||||||||||
Service cost |
$ |
$ |
$ |
$ |
$ |
$ |
||||||||||||||||||
Interest cost |
||||||||||||||||||||||||
Expected return on plan assets |
( |
) |
( |
) |
( |
) |
( |
) |
||||||||||||||||
Recognition of: |
||||||||||||||||||||||||
Unrecognized prior service cost |
||||||||||||||||||||||||
Unrecognized net actuarial loss |
||||||||||||||||||||||||
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
$ |
June 30, 2019 |
December 31, 2018 |
|||||||
Short-term borrowings |
$ |
$ |
||||||
Long-term debt: |
||||||||
Revolving credit facility, due 2024(1) |
$ |
$ |
||||||
Receivables financing agreement, due 2020 |
||||||||
Term loan denominated in U.S. dollars, due 2024(2) |
||||||||
Term loan denominated in Euros, due 2024(3) |
||||||||
Capitalized leases and other long-term debt |
||||||||
Unamortized debt issuance costs |
( |
) |
( |
) |
||||
Total long-term debt, net, including current maturities |
||||||||
Current maturities of long-term debt |
||||||||
Total long-term debt, net |
$ |
$ |
(1) |
(2) |
(3) |
Shares |
Weighted-Average Exercise Price (per share) |
|||||||
Outstanding as of December 31, 2018 |
$ |
|||||||
Granted |
$ |
|||||||
Exercised or settled |
( |
) |
$ |
|||||
Forfeited |
( |
) |
$ |
|||||
Expired |
( |
) |
$ |
|||||
Outstanding as of June 30, 2019 |
$ |
|||||||
Vested as of June 30, 2019 |
$ |
For the Six Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2018 |
|||||||
Assumptions |
||||||||
Expected life of options (in years) |
||||||||
Risk-free interest rate |
% |
% |
||||||
Assumed volatility |
% |
% |
||||||
Expected dividend rate |
% |
% |
Shares |
Weighted-Average Grant-Date Fair Value |
|||||||
Non-vested as of December 31, 2018 |
$ |
|||||||
Granted |
$ |
|||||||
Vested |
( |
) |
$ |
|||||
Forfeited |
( |
) |
$ |
|||||
Non-vested as of June 30, 2019 |
$ |
For the Three Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2019 |
|||||||||||||||||||||||
Before-Tax Amount |
Tax Benefit or (Expense) |
Net of Tax Amount |
Before-Tax Amount |
Tax (Expense) or Benefit |
Net of Tax Amount |
|||||||||||||||||||
Foreign currency translation adjustments, net |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
||||||||
Unrecognized (losses) gains on cash flow hedges, net |
( |
) |
( |
) |
||||||||||||||||||||
Pension and other postretirement benefit prior service cost and gain or loss, net |
( |
) |
( |
) |
||||||||||||||||||||
Other comprehensive loss |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
For the Three Month Period Ended June 30, 2018 |
For the Six Month Period Ended June 30, 2018 |
|||||||||||||||||||||||
Before-Tax Amount |
Tax (Expense) or Benefit |
Net of Tax Amount |
Before-Tax Amount |
Tax (Expense) or Benefit) |
Net of Tax Amount |
|||||||||||||||||||
Foreign currency translation adjustments, net |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
||||||
Unrecognized gains (losses) on cash flow hedges, net |
( |
) |
( |
) |
||||||||||||||||||||
Pension and other postretirement benefit prior service cost and gain or loss, net |
( |
) |
||||||||||||||||||||||
Other comprehensive loss |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
Foreign Currency Translation Adjustments, Net |
Unrealized (Losses) Gains on Cash Flow Hedges |
Pension and Postretirement Benefit Plans |
Total |
|||||||||||||
Balance as of December 31, 2018 |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
||||
Other comprehensive (loss) income before reclassifications |
( |
) |
( |
) |
( |
) |
||||||||||
Amounts reclassified from accumulated other comprehensive (loss) income |
||||||||||||||||
Other comprehensive (loss) income |
( |
) |
( |
) |
||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard (ASU 2018-02) |
( |
) |
( |
) |
( |
) |
||||||||||
Balance as of June 30, 2019 |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
Foreign Currency Translation Adjustments, Net |
Unrealized (Losses) Gains on Cash Flow Hedges |
Pension and Postretirement Benefit Plans |
Total |
|||||||||||||
Balance as of December 31, 2017 |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
||||
Other comprehensive (loss) income before reclassifications |
( |
) |
( |
) |
||||||||||||
Amounts reclassified from accumulated other comprehensive (loss) income |
||||||||||||||||
Other comprehensive (loss) income |
( |
) |
( |
) |
||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard (ASU 2017-12) |
||||||||||||||||
Balance as of June 30, 2018 |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
$ |
( |
) |
(1) |
Amount Reclassified from Accumulated Other Comprehensive (Loss) Income |
||||||||||||
Details about Accumulated Other Comprehensive (Loss) Income Components |
For the Six Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2018 |
Affected Line in the Statement Where Net Income is Presented |
|||||||||
Loss on cash flow hedges |
||||||||||||
Interest rate swaps |
$ |
$ |
Interest expense |
|||||||||
Total before tax |
||||||||||||
( |
) |
( |
) |
Benefit for income taxes |
||||||||
$ |
$ |
Net of tax |
||||||||||
Amortization of defined benefit pension and other postretirement benefit items |
$ |
$ |
(1) |
|||||||||
Total before tax |
||||||||||||
( |
) |
( |
) |
Benefit for income taxes |
||||||||
$ |
$ |
Net of tax |
||||||||||
Total reclassifications for the period |
$ |
$ |
Net of tax |
(1) |
June 30, 2019 |
|||||||||||||||||||||
Derivative Classification |
Notional Amount (1) |
Fair Value (1) Other Current Assets |
Fair Value (1) Other Assets |
Fair Value (1) Accrued Liabilities |
Fair Value (1) Other Liabilities |
||||||||||||||||
Derivatives Designated as Hedging Instruments |
|||||||||||||||||||||
Interest rate swap contracts |
Cash Flow |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||
Derivatives Not Designated as Hedging Instruments |
|||||||||||||||||||||
Foreign currency forwards |
Fair Value |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||
Foreign currency forwards |
Fair Value |
$ |
$ |
$ |
$ |
$ |
December 31, 2018 |
|||||||||||||||||||||
Derivative Classification |
Notional Amount (1) |
Fair Value (1) Other Current Assets |
Fair Value (1) Other Assets |
Fair Value (1) Accrued Liabilities |
Fair Value (1) Other Liabilities |
||||||||||||||||
Derivatives Designated as Hedging Instruments |
|||||||||||||||||||||
Interest rate swap contracts |
Cash Flow |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||
Derivatives Not Designated as Hedging Instruments |
|||||||||||||||||||||
Foreign currency forwards |
Fair Value |
$ |
$ |
$ |
$ |
$ |
|||||||||||||||
Foreign currency forwards |
Fair Value |
$ |
$ |
$ |
$ |
$ |
(1) |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Interest rate swap contracts |
||||||||||||||||
(Loss) gain recognized in AOCI on derivatives |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
||||||||
Loss reclassified from AOCI into income (effective portion)(1) |
( |
) |
( |
) |
( |
) |
( |
) |
(1) |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Foreign currency forward contracts (losses) gains |
$ |
( |
) |
$ |
$ |
( |
) |
$ |
||||||||
Total foreign currency transaction (losses) gains, net |
( |
) |
( |
) |
( |
) |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
(Loss) gain, net of income tax, recorded through other comprehensive income |
$ |
( |
) |
$ |
$ |
$ |
||||||||||
Balance included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018, respectively |
$ |
$ |
Level 1 | Quoted prices (unadjusted) in active markets for identical assets or liabilities as of the reporting date. |
Level 2 | Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities as of the reporting date. |
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. |
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
Financial Assets |
||||||||||||||||
Foreign currency forwards(1) |
$ |
$ |
$ |
$ |
||||||||||||
Trading securities held in deferred compensation plan(2) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Financial Liabilities |
||||||||||||||||
Foreign currency forwards(1) |
$ |
$ |
$ |
$ |
||||||||||||
Interest rate swaps(3) |
||||||||||||||||
Deferred compensation plan(2) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
(1) |
(2) |
(3) |
For the Three Month Period Ended June 30, 2019 |
||||||||||||||||
Industrials |
Energy |
Medical |
Total |
|||||||||||||
Primary Geographic Markets |
||||||||||||||||
United States |
$ |
$ |
$ |
$ |
||||||||||||
Other Americas |
||||||||||||||||
Total Americas |
$ |
$ |
$ |
$ |
||||||||||||
EMEA |
||||||||||||||||
Asia Pacific |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Product Categories |
||||||||||||||||
Original equipment(1) |
$ |
$ |
$ |
$ |
||||||||||||
Aftermarket(2) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Pattern of Revenue Recognition |
||||||||||||||||
Revenue recognized at point in time(3) |
$ |
$ |
$ |
$ |
||||||||||||
Revenue recognized over time(4) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
For the Three Month Period Ended June 30, 2018 |
||||||||||||||||
Industrials |
Energy |
Medical |
Total |
|||||||||||||
Primary Geographic Markets |
||||||||||||||||
United States |
$ |
$ |
$ |
$ |
||||||||||||
Other Americas |
||||||||||||||||
Total Americas |
$ |
$ |
$ |
$ |
||||||||||||
EMEA |
||||||||||||||||
Asia Pacific |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Product Categories |
||||||||||||||||
Original equipment(1) |
$ |
$ |
$ |
$ |
||||||||||||
Aftermarket(2) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Pattern of Revenue Recognition |
||||||||||||||||
Revenue recognized at point in time(3) |
$ |
$ |
$ |
$ |
||||||||||||
Revenue recognized over time(4) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
(1) |
(2) |
(3) |
(4) |
For the Six Month Period Ended June 30, 2019 |
||||||||||||||||
Industrials |
Energy |
Medical |
Total |
|||||||||||||
Primary Geographic Markets |
||||||||||||||||
United States |
$ |
$ |
$ |
$ |
||||||||||||
Other Americas |
||||||||||||||||
Total Americas |
$ |
$ |
$ |
$ |
||||||||||||
EMEA |
||||||||||||||||
Asia Pacific |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Product Categories |
||||||||||||||||
Original equipment(1) |
$ |
$ |
$ |
$ |
||||||||||||
Aftermarket(2) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Pattern of Revenue Recognition |
||||||||||||||||
Revenue recognized at point in time(3) |
$ |
$ |
$ |
$ |
||||||||||||
Revenue recognized over time(4) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
For the Six Month Period Ended June 30, 2018 |
||||||||||||||||
Industrials |
Energy |
Medical |
Total |
|||||||||||||
Primary Geographic Markets |
||||||||||||||||
United States |
$ |
$ |
$ |
$ |
||||||||||||
Other Americas |
||||||||||||||||
Total Americas |
$ |
$ |
$ |
$ |
||||||||||||
EMEA |
||||||||||||||||
Asia Pacific |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Product Categories |
||||||||||||||||
Original equipment(1) |
$ |
$ |
$ |
$ |
||||||||||||
Aftermarket(2) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
||||||||||||
Pattern of Revenue Recognition |
||||||||||||||||
Revenue recognized at point in time(3) |
$ |
$ |
$ |
|||||||||||||
Revenue recognized over time(4) |
||||||||||||||||
Total |
$ |
$ |
$ |
$ |
(1) | Revenues from sales of capital equipment within the Industrials and Energy Segments and sales of components to original equipment manufacturers in the Medical Segment. |
(2) | Revenues from sales of spare parts, accessories, other components and services in support of maintaining customer owned, installed base of the Company’s original equipment. |
(3) | Revenues from short and long duration product and service contracts recognized at a point in time when control is transferred to the customer generally when products delivery has occurred and services have been rendered. |
(4) | Revenues primarily from long duration ETO product contracts and certain contracts for the delivery of a significant volume of substantially similar products recognized over time as contractual performance obligations are completed. |
June 30, 2019 |
December 31, 2018 |
|||||||
Accounts receivable |
$ |
$ |
||||||
Contract assets |
||||||||
Contract liabilities |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Income before income taxes |
$ |
$ |
$ |
$ |
||||||||||||
Provision for income taxes |
$ |
$ |
$ |
$ |
||||||||||||
Effective income tax provision rate |
% |
% |
% |
% |
For the Three Month Period Ended June 30, 2019 |
For the Six Month Period Ended June 30, 2019 |
|||||||
Operating lease cost |
$ |
$ |
||||||
Finance lease cost |
||||||||
Amortization of right-of-use assets |
$ |
$ |
||||||
Interest on lease liabilities |
||||||||
Total finance lease cost |
$ |
$ |
||||||
Short-term lease cost |
$ |
$ |
For the Six Month Period Ended June 30, 2019 |
||||
Cash paid for amounts included in the measurement of leases |
||||
Operating cash flows from operating leases |
$ |
|||
Operating cash flows from finance leases |
$ |
|||
Financing cash flows from finance leases |
$ |
June 30, 2019 |
||||
Operating leases |
||||
Other assets |
$ |
|||
Accrued liabilities |
||||
Other liabilities |
||||
Total operating lease liabilities |
$ |
|||
Finance Leases |
||||
Property, plant and equipment |
$ |
|||
Short-term borrowings and current maturities of long-term debt |
||||
Long-term debt, less current maturities |
||||
Total finance lease liabilities |
$ |
|||
Weighted Average Remaining Lease Term (in years) |
||||
Operating leases |
||||
Finance leases |
||||
Weighted Average Discount Rate |
||||
Operating leases |
% |
|||
Finance leases |
% |
Operating Leases |
Finance Leases |
|||||||
2019 (excluding the six months ended June 30, 2019) |
$ |
$ |
||||||
2020 |
||||||||
2021 |
||||||||
2022 |
||||||||
2023 |
||||||||
Thereafter |
||||||||
Total lease payments |
$ |
$ |
||||||
Less imputed interest |
( |
) |
( |
) |
||||
Total |
$ |
$ |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Other Operating Expense, Net |
||||||||||||||||
Foreign currency transaction losses (gains), net |
$ |
$ |
( |
) |
$ |
$ |
||||||||||
Restructuring charges, net (1) |
||||||||||||||||
Stock-based compensation(2) |
( |
) |
||||||||||||||
Shareholder litigation settlement recoveries(3) |
( |
) |
( |
) |
||||||||||||
Acquisition related expenses and non-cash charges(4) |
||||||||||||||||
Gains on asset disposals |
( |
) |
( |
) |
( |
) |
||||||||||
Other, net |
||||||||||||||||
Total other operating expense, net |
$ |
$ |
$ |
$ |
(1) |
(2) |
(3) |
(4) |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Revenue |
||||||||||||||||
Industrials |
$ |
$ |
$ |
$ |
||||||||||||
Energy |
||||||||||||||||
Medical |
||||||||||||||||
Total Revenue |
$ |
$ |
$ |
$ |
||||||||||||
Segment Adjusted EBITDA |
||||||||||||||||
Industrials |
$ |
$ |
$ |
|||||||||||||
Energy |
||||||||||||||||
Medical |
||||||||||||||||
Total Segment Adjusted EBITDA |
$ |
$ |
$ |
$ |
||||||||||||
Less items to reconcile Segment Adjusted EBITDA to Income |
||||||||||||||||
Before Income Taxes: |
||||||||||||||||
Corporate expenses not allocated to segments(1) |
$ |
$ |
$ |
$ |
||||||||||||
Interest expense |
||||||||||||||||
Depreciation and amortization expense |
||||||||||||||||
Restructuring and related business transformation costs(2) |
||||||||||||||||
Acquisition related expenses and non-cash charges(3) |
||||||||||||||||
Expenses related to public stock offerings(4) |
||||||||||||||||
Establish public company financial reporting compliance(5) |
||||||||||||||||
Stock-based compensation(6) |
( |
) |
||||||||||||||
Foreign currency transaction losses (gains), net |
( |
) |
||||||||||||||
Loss on extinguishment of debt (7) |
||||||||||||||||
Shareholder litigation settlement recoveries(8) |
( |
) |
( |
) |
||||||||||||
Other adjustments(9) |
( |
) |
||||||||||||||
Income Before Income Taxes |
$ |
$ |
$ |
$ |
(1) |
(2) |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Restructuring charges |
$ |
$ |
$ |
$ |
||||||||||||
Severance, sign-on, relocation and executive search costs |
||||||||||||||||
Facility reorganization, relocation and other costs |
||||||||||||||||
Information technology infrastructure transformation |
||||||||||||||||
Gains on asset disposals |
( |
) |
( |
) |
( |
) |
||||||||||
Consultant and other advisor fees |
||||||||||||||||
Other, net |
||||||||||||||||
Total restructuring and related business transformation costs |
$ |
$ |
$ |
$ |
(3) |
(4) |
(5) |
(6) |
(7) |
(8) |
(9) |
For the Three Month Period Ended June 30, |
For the Six Month Period Ended June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Net income |
$ |
$ |
$ |
$ |
||||||||||||
Average shares outstanding |
||||||||||||||||
Basic |
||||||||||||||||
Diluted |
||||||||||||||||
Earnings per share |
||||||||||||||||
Basic |
$ |
$ |
$ |
$ |
||||||||||||
Diluted |
$ |
$ |
$ |
$ |
For the Three Month |
For the Six Month |
|||||||||||||||
Period Ended |
Period Ended |
|||||||||||||||
June 30, |
June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Condensed Consolidated Statement of Operations: |
||||||||||||||||
Revenues |
$ |
629.1 |
$ |
668.2 |
$ |
1,249.4 |
$ |
1,287.7 |
||||||||
Cost of sales |
394.7 |
418.9 |
784.5 |
806.6 |
||||||||||||
Gross profit |
234.4 |
249.3 |
464.9 |
481.1 |
||||||||||||
Selling and administrative expenses |
103.6 |
115.8 |
211.3 |
222.6 |
||||||||||||
Amortization of intangible assets |
30.9 |
31.5 |
62.3 |
62.4 |
||||||||||||
Other operating expense, net |
25.3 |
0.6 |
36.4 |
4.9 |
||||||||||||
Operating income |
74.6 |
101.4 |
154.9 |
191.2 |
||||||||||||
Interest expense |
22.4 |
26.1 |
44.8 |
52.1 |
||||||||||||
Loss on extinguishment of debt |
0.2 |
0.2 |
0.2 |
0.2 |
||||||||||||
Other income, net |
(1.2 |
) |
(2.4 |
) |
(2.5 |
) |
(4.5 |
) |
||||||||
Income before income taxes |
53.2 |
77.5 |
112.4 |
143.4 |
||||||||||||
Provision for income taxes |
8.3 |
17.2 |
20.3 |
40.7 |
||||||||||||
Net income |
$ |
44.9 |
$ |
60.3 |
$ |
92.1 |
$ |
102.7 |
||||||||
Percentage of Revenues: |
||||||||||||||||
Gross profit |
37.3 |
% |
37.3 |
% |
37.2 |
% |
37.4 |
% |
||||||||
Selling and administrative expenses |
16.5 |
% |
17.3 |
% |
16.9 |
% |
17.3 |
% |
||||||||
Operating income |
11.9 |
% |
15.2 |
% |
12.4 |
% |
14.8 |
% |
||||||||
Net income |
7.1 |
% |
9.0 |
% |
7.4 |
% |
8.0 |
% |
||||||||
Adjusted EBITDA |
23.5 |
% |
24.2 |
% |
23.0 |
% |
24.1 |
% |
||||||||
Other Financial Data: |
||||||||||||||||
Adjusted EBITDA (1) |
147.6 |
161.6 |
287.7 |
309.8 |
||||||||||||
Adjusted Net Income (1) |
89.8 |
92.4 |
169.1 |
173.2 |
||||||||||||
Cash flows - operating activities |
61.4 |
134.3 |
130.1 |
194.5 |
||||||||||||
Cash flows - investing activities |
(10.0 |
) |
(29.4 |
) |
(24.5 |
) |
(131.4 |
) |
||||||||
Cash flows - financing activities |
1.2 |
(106.3 |
) |
(16.1 |
) |
(114.5 |
) |
|||||||||
Free Cash Flow (1) |
50.8 |
123.5 |
105.4 |
173.6 |
(1) | See the “Non-GAAP Financial Measures” section for a reconciliation to the nearest GAAP measure. |
For the Three Month |
For the Six Month |
|||||||||||||||
Period Ended |
Period Ended |
|||||||||||||||
June 30, |
June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Net Income |
$ |
44.9 |
$ |
60.3 |
$ |
92.1 |
$ |
102.7 |
||||||||
Plus: |
||||||||||||||||
Interest expense |
22.4 |
26.1 |
44.8 |
52.1 |
||||||||||||
Provision for income taxes |
8.3 |
17.2 |
20.3 |
40.7 |
||||||||||||
Depreciation expense |
13.5 |
13.8 |
27.6 |
27.8 |
||||||||||||
Amortization expense (1) |
30.9 |
31.5 |
62.3 |
62.4 |
||||||||||||
Restructuring and related business transformation costs (2) |
2.0 |
8.4 |
6.1 |
12.9 |
||||||||||||
Acquisition related expenses and non-cash charges (3) |
17.1 |
5.7 |
18.7 |
10.3 |
||||||||||||
Expenses related to public stock offerings (4) |
- |
0.5 |
- |
1.9 |
||||||||||||
Establish public company financial reporting compliance (5) |
- |
1.1 |
0.6 |
1.9 |
||||||||||||
Stock-based compensation (6) |
7.1 |
(0.8 |
) |
16.4 |
1.9 |
|||||||||||
Foreign currency transaction losses (gains), net |
0.6 |
(2.4 |
) |
3.7 |
0.2 |
|||||||||||
Loss on extinguishment of debt (7) |
0.2 |
0.2 |
0.2 |
0.2 |
||||||||||||
Shareholder litigation settlement recoveries (8) |
- |
- |
(6.0 |
) |
(4.5 |
) |
||||||||||
Other adjustments (9) |
0.6 |
- |
0.9 |
(0.7 |
) |
|||||||||||
Adjusted EBITDA |
$ |
147.6 |
$ |
161.6 |
$ |
287.7 |
$ |
309.8 |
||||||||
Minus: |
||||||||||||||||
Interest expense |
$ |
22.4 |
$ |
26.1 |
$ |
44.8 |
$ |
52.1 |
||||||||
Income tax provision, as adjusted (10) |
19.2 |
25.4 |
40.5 |
49.9 |
||||||||||||
Depreciation expense |
13.5 |
13.8 |
27.6 |
27.8 |
||||||||||||
Amortization of non-acquisition related intangible assets |
2.7 |
3.9 |
5.7 |
6.8 |
||||||||||||
Adjusted Net Income |
$ |
89.8 |
$ |
92.4 |
$ |
169.1 |
$ |
173.2 |
||||||||
Free Cash Flow |
||||||||||||||||
Cash flows - operating activities |
$ |
61.4 |
$ |
134.3 |
$ |
130.1 |
$ |
194.5 |
||||||||
Minus: |
||||||||||||||||
Capital expenditures |
10.6 |
10.8 |
24.7 |
20.9 |
||||||||||||
Free Cash Flow |
$ |
50.8 |
$ |
123.5 |
$ |
105.4 |
$ |
173.6 |
(1) | Represents $28.2 million and $27.6 million of amortization of intangible assets arising from the KKR transaction and other acquisitions (customer relationships and trademarks) and $2.7 million and $3.9 million of amortization of non-acquisition related intangible assets, in each case for the three month periods ended June 30, 2019 and 2018, respectively. Represents $56.6 million and $55.6 million of amortization of intangible assets arising from the KKR transaction and other acquisitions (customer relationships and trademarks) and $5.7 million and $6.8 million of amortization of non-acquisition related intangible assets, in each case for the six month periods ended June 30, 2019 and 2018, respectively. |
(2) | Restructuring and related business transformation costs consisted of the following. |
For the Three Month |
For the Six Month |
|||||||||||||||
Period Ended |
Period Ended |
|||||||||||||||
June 30, |
June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Restructuring charges |
$ |
0.8 |
$ |
- |
$ |
2.8 |
$ |
- |
||||||||
Severance, sign-on, relocation and executive search costs |
0.2 |
1.9 |
1.2 |
3.9 |
||||||||||||
Facility reorganization, relocation and other costs |
0.5 |
0.7 |
1.1 |
1.3 |
||||||||||||
Information technology infrastructure transformation |
0.4 |
0.2 |
0.7 |
0.2 |
||||||||||||
Gains on asset disposals |
(0.4 |
) |
- |
(0.3 |
) |
(1.2 |
) |
|||||||||
Consultant and other advisor fees |
0.1 |
4.0 |
0.2 |
6.6 |
||||||||||||
Other, net |
0.4 |
1.6 |
0.4 |
2.1 |
||||||||||||
Total restructuring and related business transformation costs |
$ |
2.0 |
$ |
8.4 |
$ |
6.1 |
$ |
12.9 |
(3) | Represents costs associated with successful and/or abandoned acquisitions, including third-party expenses, post-closure integration costs (including certain incentive and non-incentive cash compensation costs), and non-cash charges and credits arising from fair value purchase accounting adjustments. |
(4) | Represents certain expenses related to the Company’s secondary stock offerings. |
(5) | Represents third party expenses to comply with the requirements of Sarbanes-Oxley and the accelerated adoption of the new accounting standards (ASC 606 – Revenue from Contracts with Customers and ASC 842 – Leases) in the first quarter of 2018 and 2019, respectively, one year ahead of the required adoption dates for a private company. |
(6) | Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2019 of $6.0 million and $13.6 million, respectively, increased by $1.1 million and $2.8 million for the three month and six month periods ended June 30, 2019, respectively, due to costs associated with employer taxes. |
(7) | Represents losses on extinguishment of a portion of the U.S. term loan and the amendment of the revolving credit facility. |
(8) | Represents an insurance recovery of the Company’ shareholder litigation settlement in 2014. |
(9) | Includes (i) effects of the amortization of prior service costs and amortization of losses in pension and other postemployment (‘‘OPEB’’) expense, (ii) certain legal and compliance costs and (iii) other miscellaneous adjustments. |
(10) | Represents our income tax provision adjusted for the tax effect of pre-tax items excluded from Adjusted Net Income and the removal of the applicable discrete tax items. The tax effect of pre-tax items excluded from Adjusted Income is computed using the statutory tax rate related to the jurisdiction that was impacted by the adjustment after taking into account the impact of permanent differences and valuation allowances. Discrete tax items include changes in tax laws or rates, changes in uncertain tax positions relating to prior years and changes in valuation allowances. All impacts relating to the Tax Cuts and Jobs Act of 2017 have been included as adjustments within “Tax law change” of the table below. |
For the Three Month |
For the Six Month |
|||||||||||||||
Period Ended |
Period Ended |
|||||||||||||||
June 30, |
June 30, |
|||||||||||||||
2019 |
2018 |
2019 |
2018 |
|||||||||||||
Provision for income taxes |
$ |
8.3 |
$ |
17.2 |
$ |
20.3 |
$ |
40.7 |
||||||||
Tax impact of pre-tax income adjustments |
10.8 |
7.7 |
20.5 |
16.6 |
||||||||||||
Tax law change |
- |
- |
- |
(7.9 |
) |
|||||||||||
Discrete tax items |
0.1 |
0.5 |
(0.3 |
) |
0.5 |
|||||||||||
Income tax provision, as adjusted |
$ |
19.2 |
$ |
25.4 |
$ |
40.5 |
$ |
49.9 |
For the Three Month Period Ended June 30, |
Percent Change |
Constant Currency Percent Change |
||||||||||||||
2019 |
2018 |
2019 vs. 2018 |
2019 vs. 2018 |
|||||||||||||
Segment Revenues |
$ |
334.3 |
$ |
328.7 |
1.7 |
% |
5.5 |
% |
||||||||
Segment Adjusted EBITDA |
$ |
76.6 |
$ |
71.1 |
7.7 |
% |
11.5 |
% |
||||||||
Segment Margin |
22.9 |
% |
21.6 |
% |
130 bps |
For the Six Month Period Ended June 30, |
Percent Change |
Constant Currency Percent Change |
||||||||||||||
2019 |
2018 |
2019 vs. 2018 |
2019 vs. 2018 |
|||||||||||||
Segment Revenues |
$ |
652.4 |
$ |
645.6 |
1.1 |
% |
5.5 |
% |
||||||||
Segment Adjusted EBITDA |
$ |
147.7 |
$ |
137.9 |
7.1 |
% |
11.7 |
% |
||||||||
Segment Margin |
22.6 |
% |
21.4 |
% |
120 bps |
For the Three Month Period Ended June 30, |
Percent Change |
Constant Currency Percent Change |
||||||||||||||
2019 |
2018 |
2019 vs. 2018 |
2019 vs. 2018 |
|||||||||||||
Segment Revenues |
$ |
222.8 |
$ |
273.1 |
(18.4 |
%) |
(16.8 |
%) |
||||||||
Segment Adjusted EBITDA |
$ |
56.3 |
$ |
79.7 |
(29.4 |
%) |
(28.5 |
%) |
||||||||
Segment Margin |
25.3 |
% |
29.2 |
% |
(390) bps |
For the Six Month Period Ended June 30, |
Percent Change |
Constant Currency Percent Change |
||||||||||||||
2019 |
2018 |
2019 vs. 2018 |
2019 vs. 2018 |
|||||||||||||
Segment Revenues |
$ |
455.9 |
$ |
515.3 |
(11.5 |
%) |
(9.4 |
%) |
||||||||
Segment Adjusted EBITDA |
$ |
116.3 |
$ |
147.6 |
(21.2 |
%) |
(20.1 |
%) |
||||||||
Segment Margin |
25.5 |
% |
28.6 |
% |
(310) bps |
For the Three Month Period Ended June 30, |
Percent Change |
Constant Currency Percent Change |
||||||||||||||
2019 |
2018 |
2019 vs. 2018 |
2019 vs. 2018 |
|||||||||||||
Segment Revenues |
$ |
72.0 |
$ |
66.4 |
8.4 |
% |
12.0 |
% |
||||||||
Segment Adjusted EBITDA |
$ |
21.4 |
$ |
18.0 |
18.9 |
% |
23.3 |
% |
||||||||
Segment Margin |
29.7 |
% |
27.1 |
% |
260 bps |
For the Six Month Period Ended June 30, |
Percent Change |
Constant Currency Percent Change |
||||||||||||||
2019 |
2018 |
2019 vs. 2018 |
2019 vs. 2018 |
|||||||||||||
Segment Revenues |
$ |
141.1 |
$ |
126.8 |
11.3 |
% |
15.5 |
% |
||||||||
Segment Adjusted EBITDA |
$ |
41.4 |
$ |
33.9 |
22.1 |
% |
27.4 |
% |
||||||||
Segment Margin |
29.3 |
% |
26.7 |
% |
260 bps |
June 30, |
December 31, |
|||||||
2019 |
2018 |
|||||||
Cash and cash equivalents |
$ |
317.5 |
$ |
221.2 |
||||
Short-term borrowings and current maturities of long-term debt |
8.0 |
7.9 |
||||||
Long-term debt |
1,623.5 |
1,664.2 |
||||||
Total debt |
$ |
1,631.5 |
$ |
1,672.1 |
June 30, |
December 31, |
|||||||
2019 |
2018 |
|||||||
Net Working Capital: |
||||||||
Current assets |
$ |
1,463.9 |
$ |
1,331.2 |
||||
Less: Current liabilities |
591.3 |
596.4 |
||||||
Net working capital |
$ |
872.6 |
$ |
734.8 |
||||
Operating Working Capital: |
||||||||
Accounts receivable and contract assets |
$ |
524.6 |
$ |
545.0 |
||||
Plus: Inventories (excluding LIFO) |
544.4 |
510.7 |
||||||
Less: Accounts payable |
331.8 |
340.0 |
||||||
Less: Contract liabilities |
60.6 |
69.6 |
||||||
Operating working capital |
$ |
676.6 |
$ |
646.1 |
For the Six Month Period Ended June 30, |
||||||||
2019 |
2018 |
|||||||
Cash flows - operating activities |
$ |
130.1 |
$ |
194.5 |
||||
Cash flows - investing activities |
(24.5 |
) |
(131.4 |
) |
||||
Cash flows - financing activities |
(16.1 |
) |
(114.5 |
) |
||||
Free cash flow(1) |
105.4 |
173.6 |
(1) | See the “Non-GAAP Financial Measures” section included in this Quarterly Report for a reconciliation to the nearest GAAP measure. |
• | execution of the proposed Merger will require significant time and attention from management, which may distract them from the operation of our business and the execution of other initiatives that may have been beneficial to us; |
• | our employees may be distracted due to uncertainty about their future roles with the Company pending the completion of the Merger; |
• | parties with which we have business relationships may experience uncertainty as to the future of such relationships and may delay or defer certain business decisions, seek alternative relationships with third parties or alter their present business relationships with us; |
• | we could be subject to litigation related to the proposed Merger, which could result in significant costs and expenses; |
• | we will be required to pay significant costs and expenses relating to the Merger, such as legal, accounting and other professional fees, whether or not the Merger is completed; |
• | we may have to forgo other opportunities in favor of the Merger instead of pursuing such other opportunities that could be beneficial to the Company; and |
• | we may experience negative reactions from the financial markets. |
2019 Second Quarter Months |
Total Number of Shares Purchased(1) |
Average Price Paid Per Share(2) |
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (3) |
Maximum Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (3) |
||||||||||||
April 1, 2019 - April 30, 2019 |
20,504 |
$ |
27.77 |
- |
220,756,556 |
|||||||||||
May 1, 2019 - May 31, 2019 |
226,165 |
$ |
34.94 |
- |
220,756,556 |
|||||||||||
June 1, 2019 - June 30, 2019 |
4,277 |
$ |
34.59 |
- |
220,756,556 |
(1) | All of the shares purchased during the three month period ended June 30, 2019 were in connection with net exercises of stock options. |
(2) | The average price paid per share includes brokerage commissions. |
(3) | On August 1, 2018, the Company announced that our Board of Directors had approved a share repurchase program which authorized the repurchase of up to $250.0 million of the Company’s outstanding common stock over the next two years, effective August 1, 2018 until and including July 31, 2020. For a further description of the share repurchase program, see Note 24 ‘‘Share Repurchase Program’’ to our consolidated financial statements in the annual report on Form 10-K for the fiscal year ended December 31, 2018. |
Exhibit No. |
Description |
Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002 (furnished herewith) |
|
Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002 (furnished herewith) |
|
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith) |
|
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith) |
|
Date: August 2, 2019 |
GARDNER DENVER HOLDINGS, INC. |
||
By: |
/s/ Michael J. Scheske |
||
Name: Michael J. Scheske |
|||
Vice President and Corporate Controller (Principal Accounting Officer) |
/s/ Vicente Reynal
|
|
Vicente Reynal
|
|
Chief Executive Officer and Director
|
|
(Principal Executive Officer)
|
/s/ Neil D. Snyder
|
|
Neil D. Snyder
|
|
Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|
/s/ Vicente Reynal
|
|
Vicente Reynal
|
|
Chief Executive Officer and Director
|
|
(Principal Executive Officer)
|
/s/ Neil D. Snyder
|
|
Neil D. Snyder
|
|
Vice President and Chief Financial Officer
|
|
(Principal Financial Officer)
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) [Abstract] | ||||
Revenues | $ 629.1 | $ 668.2 | $ 1,249.4 | $ 1,287.7 |
Cost of sales | 394.7 | 418.9 | 784.5 | 806.6 |
Gross Profit | 234.4 | 249.3 | 464.9 | 481.1 |
Selling and administrative expenses | 103.6 | 115.8 | 211.3 | 222.6 |
Amortization of intangible assets | 30.9 | 31.5 | 62.3 | 62.4 |
Other operating expense, net | 25.3 | 0.6 | 36.4 | 4.9 |
Operating Income | 74.6 | 101.4 | 154.9 | 191.2 |
Interest expense | 22.4 | 26.1 | 44.8 | 52.1 |
Loss on extinguishment of debt | 0.2 | 0.2 | 0.2 | 0.2 |
Other income, net | (1.2) | (2.4) | (2.5) | (4.5) |
Income Before Income Taxes | 53.2 | 77.5 | 112.4 | 143.4 |
Provision for income taxes | 8.3 | 17.2 | 20.3 | 40.7 |
Net Income | $ 44.9 | $ 60.3 | $ 92.1 | $ 102.7 |
Basic earnings per share (in dollars per share) | $ 0.22 | $ 0.30 | $ 0.45 | $ 0.51 |
Diluted earnings per share (in dollars per share) | $ 0.21 | $ 0.29 | $ 0.44 | $ 0.49 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) [Abstract] | ||||||||
Net income | $ 44.9 | $ 60.3 | $ 92.1 | $ 102.7 | ||||
Other comprehensive loss, net of tax: | ||||||||
Foreign currency translation adjustments, net | (6.4) | (67.5) | (6.5) | (33.1) | ||||
Unrecognized (losses) gains on cash flow hedges, net | (0.5) | 4.7 | 1.4 | 16.1 | ||||
Pension and other postretirement prior service cost and gain or loss, net | 1.2 | 2.7 | 1.4 | 3.1 | ||||
Total other comprehensive loss, net of tax | (5.7) | (60.1) | (3.7) | [1] | (13.9) | [1] | ||
Total Comprehensive Income | $ 39.2 | $ 0.2 | $ 88.4 | $ 88.8 | ||||
|
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Millions |
Jun. 30, 2019 |
Dec. 31, 2018 |
---|---|---|
Current assets: | ||
Accounts receivable, allowance for doubtful accounts | $ 18.2 | $ 17.4 |
Property, plant and equipment, accumulated depreciation | $ 269.1 | $ 250.0 |
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 205,676,965 | 201,051,291 |
Treasury stock (in shares) | 1,752,448 | 2,881,436 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Cash Flows From Operating Activities: | ||
Net income | $ 92.1 | $ 102.7 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Amortization of intangible assets | 62.3 | 62.4 |
Depreciation in cost of sales | 22.8 | 22.8 |
Depreciation in selling and administrative expenses | 4.8 | 5.0 |
Stock-based compensation expense | 13.6 | 5.2 |
Foreign currency transaction losses, net | 3.7 | 0.2 |
Net gain on asset dispositions | (0.3) | (1.2) |
Loss on extinguishment of debt | 0.2 | 0.2 |
Deferred income taxes | 6.5 | 9.2 |
Changes in assets and liabilities: | ||
Receivables | 17.2 | 43.2 |
Inventories | (35.0) | (46.8) |
Accounts payable | (0.8) | 45.3 |
Accrued liabilities | (0.9) | (42.7) |
Other assets and liabilities, net | (56.1) | (11.0) |
Net cash provided by operating activities | 130.1 | 194.5 |
Cash Flows From Investing Activities: | ||
Capital expenditures | (24.7) | (20.9) |
Net cash paid in business combinations | (0.5) | (113.6) |
Disposals of property, plant and equipment | 0.7 | 3.1 |
Net cash used in investing activities | (24.5) | (131.4) |
Cash Flows From Financing Activities: | ||
Principal payments on long-term debt | (28.8) | (110.5) |
Purchases of treasury stock | (17.1) | (9.2) |
Proceeds from stock option exercises | 32.1 | 5.2 |
Payments of contingent consideration | (2.0) | 0.0 |
Payments of debt issuance costs | (0.3) | 0.0 |
Net cash used in financing activities | (16.1) | (114.5) |
Effect of exchange rate changes on cash and cash equivalents | 6.8 | (4.1) |
Net increase (decrease) in cash and cash equivalents | 96.3 | (55.5) |
Cash and cash equivalents, beginning of period | 221.2 | 393.3 |
Cash and cash equivalents, end of period | 317.5 | 337.8 |
Supplemental Cash Flow Information | ||
Cash paid for income taxes | 31.5 | 62.4 |
Cash paid for interest | 42.5 | 51.7 |
Debt issuance costs in accounts payable | 0.5 | 0.0 |
Debt issuance costs in accrued liabilities | 5.6 | 0.0 |
Capital expenditures in accounts payable | $ 3.8 | $ 3.1 |
Condensed Consolidated Financial Statements |
6 Months Ended |
---|---|
Jun. 30, 2019 | |
Condensed Consolidated Financial Statements [Abstract] | |
Condensed Consolidated Financial Statements |
Note 1. Condensed Consolidated Financial Statements
Basis of Presentation
Gardner Denver Holdings, Inc. is a holding company whose operating subsidiaries are Gardner Denver, Inc. (“GDI”) and certain of GDI’s subsidiaries. GDI is a diversified, global manufacturer of highly engineered, application-critical flow control products and provider of related aftermarket parts and services. The accompanying condensed consolidated financial statements include the accounts of Gardner Denver Holdings, Inc. and its majority-owned subsidiaries (collectively referred to herein as “Gardner Denver” or the “Company”). The financial information presented as of any date other than December 31, 2018 has been prepared from the books and records of the Company without audit. The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, the condensed consolidated financial statements include all adjustments, consisting of adjustments associated with acquisition accounting and normal recurring adjustments, necessary for the fair presentation of such financial statements. All intercompany transactions and accounts have been eliminated in consolidation.
The Company’s unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the Securities and Exchange Commission (“SEC”).
The results of operations for the interim periods ended June 30, 2019 are not necessarily indicative of the results to be expected for the full year. The balance sheet as of December 31, 2018 has been derived from the Company’s audited financial statements as of that date but does not include all of the information and notes required by GAAP for complete financial statements.
In May 2017, the Company sold a total of 47,495,000 shares of common stock in an initial public offering of shares of common stock. On November 15, 2017, May 2, 2018 and October 31, 2018, the Company completed secondary offerings of 25,300,000 shares, 30,533,478 and 20,000,000 shares, respectively, of common stock held by affiliates of Kohlberg Kravis Roberts & Co. L.P. (“KKR”). As a result of the secondary offerings, the Company is no longer considered a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange (“NYSE”). KKR owns 70,671,135 shares of common stock, or approximately 35% of the total outstanding common stock based on the number of shares outstanding as of June 30, 2019.
Recently Adopted Accounting Standard Updates (“ASU”)
ASU 2016-02, Leases (Topic 842)
On January 1, 2019, the Company adopted Financial Accounting Standards Board (“FASB”) ASU 2016-02, Leases (Topic 842) (“ASC 842”) utilizing the optional transition method. The amendments in this update replaced most of the existing GAAP lease accounting guidance in order to increase transparency and comparability among organizations by recognizing right-of-use lease assets and lease liabilities on the balance sheet for those leases classified as operating leases under current GAAP. The amendments also expanded disclosure requirements for key information about leasing arrangements. The Company elected the package of practical expedients in transition for leases that commenced prior to January 1, 2019 whereby these contracts were not reassessed or reclassified from their previous assessment as of December 31, 2018. The Company updated its internal lease accounting policy to address the new standard, revised the Company’s business processes and controls and completed the implementation and data input for the Company’s lease accounting software solution. The most significant impact of the standard on the Company was the recognition of an approximate $61.3 million operating right of use (“ROU”) asset and an approximate $61.4 million operating lease liability on the Condensed Consolidated Balance Sheet. The standard did not have a material impact on both the Company’s Condensed Consolidated Statements of Operations and the Company’s Condensed Consolidated Statements of Cash Flows. See Note 14, “Leases” for further discussion of the Company’s operating and financing leases.
ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income
On January 1, 2019, the Company adopted FASB ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”). The standard allowed a reclassification from accumulated other comprehensive (loss) income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act as of January 1, 2019. The Company recorded a cumulative-effect adjustment on the adoption date decreasing “Accumulated deficit” in the Condensed Consolidated Balance Sheets by $8.2 million and increasing “Accumulated other comprehensive loss” in the Condensed Consolidated Balance Sheets by $8.2 million.
Recently Issued Accounting Pronouncements
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this update eliminate, add and modify certain disclosure requirements for fair value measurements as part of its disclosure framework project. The guidance is effective for public companies beginning in the first quarter of 2020. Early adoption is permitted. The Company is currently assessing the impact of this ASU on its condensed consolidated financial statements and evaluating the timing of adoption.
In August 2018, the FASB issued ASU 2018-14, Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans. The amendments in this eliminate, add and modify certain disclosure requirements for defined benefit pension plans. The guidance is effective for public companies beginning with its annual report for fiscal year 2020. Early adoption is permitted. The Company is currently assessing the impact of this ASU on its condensed consolidated financial statements and evaluating the timing of adoption.
In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40); Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The amendments in this update require implementation costs incurred by customers in cloud computing arrangements (i.e., hosting arrangements) to be capitalized under the same premises of authoritative guidance for internal-use software, and deferred over the noncancellable term of the cloud computing arrangement plus any option renewal periods that are reasonably certain to be exercised by the customer or for which the exercise is controlled by the service provider. The Company is required to adopt this new guidance in the first quarter of 2020. Early adoption is permitted. The Company is currently assessing the impact of this ASU on its condensed consolidated financial statements and evaluating the timing of adoption.
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Business Combinations |
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Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations |
Note 2. Business Combinations
Acquisition of MP Pumps, Inc.
On December 12, 2018, the Company acquired MP Pumps, Inc. (“MP Pumps”), a leading manufacturer of specialty industrial pumps and associated aftermarket parts. The Company acquired all of the assets and assumed certain liabilities of MP Pumps for total consideration, net of cash acquired, of $58.5 million, which consisted of cash payments of $57.8 million, a payable $0.1 million purchase price adjustment and a $0.6 million holdback. During the first quarter of 2019, an additional purchase price adjustment of $0.2 million removed the $0.1 million payable purchase price adjustment and reduced the holdback to $0.5 million. The $0.5 million holdback was paid in the first quarter of 2019 and recorded in “Net cash paid in business combinations” in the Condensed Consolidated Statements of Cash Flows. The revenues and operating income of MP Pumps are included in the Company’s condensed consolidated financial statements from the acquisition date and are included in the Industrials segment. None of the goodwill resulting from this acquisition is deductible for tax purposes.
Acquisition of DV Systems, Inc.
On November 2, 2018, the Company acquired DV Systems, Inc. (“DV Systems”), a leading manufacturer of rotary screws and piston compressors and associated aftermarket parts. The Company acquired all of the assets and assumed certain liabilities of DV Systems for total consideration, net of cash acquired, of $16.1 million, which consisted of cash payments of $14.8 million and a $1.3 million holdback. During the first quarter of 2019, the purchase price was increased by $0.1 million and resulted in a payable $0.1 million purchase price adjustment. Of the $1.3 million holdback and $0.1 million purchase price adjustment, $0.4 million is expected to be paid by the end of the fourth quarter of 2019, $0.5 million by the end of the first quarter of 2020, and $0.5 million by the end of the fourth quarter of 2020. $0.9 million of the holdback and purchase price adjustment is recorded in “Accrued liabilities” in the Condensed Consolidated Balance Sheets and the remaining $0.5 million is recorded in “Other liabilities” in the Condensed Consolidated Balance Sheets. The revenues and operating income of DV Systems are included in the Company’s condensed consolidated financial statements from the acquisition date and are included in the Industrials segment. None of the goodwill resulting from this acquisition is deductible for tax purposes.
Acquisition of PMI Pump Parts
On May 29, 2018, the Company acquired PMI Pump Parts (“PMI”), a leading manufacturer of plungers and other well service pump consumable products. The Company acquired all of the assets and assumed certain liabilities of PMI for total consideration, net of cash acquired, of $21.0 million, which consisted of cash payments of $18.8 million, a $2.0 million promissory note and a $0.2 million holdback. The $0.2 million holdback and $1.0 million of the promissory note were paid in the fourth quarter of 2018. The remaining $1.0 million of the promissory note was paid in the second quarter of 2019 and recorded in “Payments for contingent consideration” in the Condensed Consolidated Statements of Cash Flows. The revenues and operating income of PMI are included in the Company’s condensed consolidated financial statements from the acquisition date and are included in the Energy segment. None of the goodwill resulting from this acquisition is deductible for tax purposes.
Acquisition of Runtech Systems Oy
On February 8, 2018, the Company acquired 100% of the stock of Runtech Systems Oy (“Runtech”), a leading global manufacturer of turbo vacuum technology systems and optimization solutions for industrial applications. The Company acquired all of the assets and assumed certain liabilities of Runtech for total cash consideration of $94.9 million, net of cash acquired. The revenues and operating income of Runtech are included in the Company’s condensed consolidated financial statements from the acquisition date and are included in the Industrials segment. The purchase price allocation resulted in the recording of $63.6 million of goodwill and $31.3 million of amortizable intangible assets as of the acquisition date. None of the goodwill resulting from this acquisition is deductible for tax purposes.
Acquisition Revenues and Operating Income (Loss)
The following table summarizes the revenue and operating income (loss) of these acquisitions for the periods presented subsequent to their date of acquisition.
Pro forma information regarding these acquisitions have not been provided as they did not have a material impact on the Company’s condensed consolidated results of operations individually or in the aggregate.
Transaction with Ingersoll Rand
On April 30, 2019, the Company entered into a definitive agreement with Ingersoll-Rand plc (“Ingersoll Rand”) pursuant to which Ingersoll Rand will separate its Industrial segment (“Ingersoll Rand Industrial”) and then combine it with the Company (the “Merger Agreement”). The transaction will be effected through a “Reverse Morris Trust” transaction pursuant to which Ingersoll Rand Industrial is expected to be spun-off to Ingersoll Rand’s shareholders and simultaneously merged with and surviving as a wholly-owned subsidiary of Gardner Denver (the “Merger”). Under the terms of the Merger Agreement, which has been unanimously approved by the Boards of Directors of Ingersoll Rand and the Company, at the time of close, Ingersoll Rand will receive $1.9 billion in cash from Ingersoll Rand Industrial that will be funded by newly-issued debt assumed by the Company in the Merger. Upon close of the transaction, existing Ingersoll Rand shareholders will receive 50.1% of the shares of the Company on a fully diluted basis.
The Merger is expected to close in early 2020, subject to approval by the Company’s stockholders, regulatory approvals and customary closing conditions.
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Restructuring |
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Restructuring |
Note 3. Restructuring
Restructuring Program 2018
In the third quarter of 2018, the Company announced a restructuring program that primarily involves workforce reductions and facility consolidation. These actions are expected to continue throughout 2019 and are focused on targeted workforce optimization within general and administrative back-office and manufacturing overhead as well as continued facility consolidation. In the six month period ended June 30, 2019, $2.8 million was charged to expense through ‘‘Other operating expense, net’’ in the Condensed Consolidated Statements of Operations ($1.9 million for Industrials, $1.1 million for Energy and $(0.2) million for Medical).
The following table summarizes the activity associated with the Company’s restructuring programs for the six month period ended June 30, 2019.
As of June 30, 2019, restructuring reserves of $5.8 million are included in “Accrued liabilities” in the Condensed Consolidated Balance Sheets. As of December 31, 2018, restructuring reserves of $10.1 million related to these programs were included in ‘‘Accrued liabilities’’ in the Consolidated Balance Sheets.
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Inventories |
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Inventories |
Note 4. Inventories
Inventories as of June 30, 2019 and December 31, 2018 consisted of the following.
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Goodwill and Other Intangible Assets |
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Goodwill and Other Intangible Assets |
Note 5. Goodwill and Other Intangible Assets
The changes in the carrying amount of goodwill attributable to each reportable segment for the six month period ended June 30, 2019 is presented in the table below.
As of June 30, 2019, goodwill included a total of $563.9 million of accumulated impairment losses within the Energy segment. There were no goodwill impairment charges recorded during the six month periods ended June 30, 2019 and 2018.
Other intangible assets as of June 30, 2019 and December 31, 2018 consisted of the following.
Amortization of intangible assets for the three and six month periods ended June 30, 2019 and 2018 were as follows.
Amortization of intangible assets is anticipated to be approximately $123.2 million annually in 2020 through 2024 based upon exchange rates as of June 30, 2019.
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Accrued Liabilities |
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Accrued Liabilities |
Note 6. Accrued Liabilities
Accrued liabilities as of June 30, 2019 and December 31, 2018 consisted of the following.
A reconciliation of the changes in the accrued product warranty liability for the three and six month periods ended June 30, 2019 and 2018 are as follows.
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Pension and Other Postretirement Benefits |
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Pension and Other Postretirement Benefits |
Note 7. Pension and Other Postretirement Benefits
The following table summarizes the components of net periodic benefit cost for the Company’s defined benefit pension plans and other postretirement benefit plans recognized for the three and six month periods ended June 30, 2019 and 2018.
The components of net periodic benefit cost other than the service cost component are included in “Other income, net” in the Condensed Consolidated Statements of Operations.
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Debt |
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Debt |
Note 8. Debt
Debt as of June 30, 2019 and December 31, 2018 is summarized as follows.
On June 28, 2019, the Company entered into Amendment No. 4 to the Credit Agreement, dated as of July 30, 2013 (as amended by Amendment No. 1 to the Credit Agreement, dated as of March 4, 2016, Amendment No. 2, dated as of August 17, 2017 and Amendment No. 3 dated as of December 13, 2018) with UBS AG, Stamford Branch, as Resigning Agent and Citibank, N.A. as Successor Agent.
Amendment No. 4 (i) refinanced the existing senior secured revolving credit facility with a replacement $450.0 million senior secured revolving credit facility (the “New Revolving Credit Facility”); (ii) extended the maturity of the revolving credit facility to June 28, 2024, (iii) terminated the revolving credit facility commitments of certain lenders under the existing senior secured revolving credit facility under the Credit Agreement, (iv) provided for up to $200.0 million of the New Revolving Credit Facility to be available for the purpose of issuing letters of credit; (v) provided for the replacement of GD First (UK) Limited by Gardner Denver Holdings, Ltd. as the UK Borrower under the Amended Credit Agreement; (vi) transferred the Administrative Agent, Collateral Agent and Swingline Lender roles under the Amended Credit Agreement to Citibank, N.A; and (vii) made certain other corresponding technical changes and updates.
At the consummation of the merger between Gardner Denver Holdings, Inc, and Ingersoll-Rand plc, Amendment No. 4 increases the aggregate amount of the New Revolving Credit Facility to $1,000.0 million and increases the capacity under the New Revolving Credit Facility to issue letters of credit to $400.0 million.
Loans under the New Revolving Credit Facility will have an initial applicable margin of 2.25% for LIBOR loans and 1.25% for base rate loans.
Amendment No. 4 resulted in the write-off of $0.2 million of debt issuance costs for the three and six month periods ended June 30, 2019. This was included in “Loss on extinguishment of debt” in the Condensed Consolidated Statements of Operations.
As of June 30, 2019, the Company had no outstanding borrowings, $5.0 million of outstanding letters of credit under the New Revolving Credit Facility and unused availability of $445.0 million.
In March 2019, the Company used excess cash to repay $25.0 million of principal on outstanding borrowings under the Dollar Term Loan Facility.
As of June 30, 2019, the Company had no outstanding borrowings, $26.7 million of letters of credit outstanding and $76.4 million of capacity available under the Receivables Financing Agreement (“RFA”).
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Stock-Based Compensation |
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Stock-Based Compensation |
Note 9. Stock-Based Compensation
The Company has outstanding stock-based compensation awards granted under the 2013 Stock Incentive Plan (“2013 Plan”) and the 2017 Omnibus Incentive Plan (“2017 Plan”) as described in Note 16, “Stock-Based Compensation Plans” to the consolidated financial statements in its annual report on Form 10-K for the year ended December 31, 2018.
In the three and six month periods ended June 30, 2019, the Company recognized stock-based compensation expense of approximately $6.0 million and $13.6 million, respectively. The Company recognized stock-based compensation expense of approximately $1.8 million and $5.2 million for the three and six month periods ended June 30, 2018, respectively. These costs are included in “Other operating expense, net” in the Condensed Consolidated Statements of Operations.
The $13.6 million of stock-based compensation expense for the six month period ended June 30, 2019 included expense of $0.7 million for the modification of a former employee’s equity awards, expense for equity awards granted under the 2013 Plan and 2017 Plan of $5.0 million and an increase in the liability for stock appreciation rights (“SAR”) of $7.9 million. The $0.7 million stock-based compensation expense for the modification incurred in the six month period ended June 30, 2019 provided continued vesting through scheduled vesting dates for certain awards of a former employee.
As of June 30, 2019, there was $35.0 million of total unrecognized compensation expense related to outstanding stock options and restricted stock awards.
SARs, granted under the 2013 Plan are expected to be settled in cash and are accounted for as liability awards. As of June 30, 2019, a liability of approximately $11.2 million for SARs was included in “Accrued liabilities” in the Condensed Consolidated Balance Sheets.
Stock Option Awards
A summary of the Company’s stock option (including SARs) activity for the six month period ended June 30, 2019 is presented in the following table (underlying shares in thousands).
The following assumptions were used to estimate the fair value of options granted (excluding previously disclosed modified awards) during the six month periods ended June 30, 2019 and 2018 using the Black-Scholes option-pricing model.
Restricted Stock Unit Awards
A summary of the Company’s restricted stock unit activity for the six month period ended June 30, 2019 is presented in the following table (underlying shares in thousands).
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Accumulated Other Comprehensive (Loss) Income |
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Accumulated Other Comprehensive (Loss) Income [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive (Loss) Income |
Note 10. Accumulated Other Comprehensive (Loss) Income
The Company’s other comprehensive income (loss) consists of (i) unrealized foreign currency net gains and losses on the translation of the assets and liabilities of its foreign operations; (ii) realized and unrealized foreign currency gains and losses on intercompany notes of a long-term nature and certain hedges of net investments in foreign operations, net of income taxes; (iii) unrealized gains and losses on cash flow hedges (consisting of interest rate swaps), net of income taxes; and (iv) pension and other postretirement prior service cost and actuarial gains or losses, net of income taxes. See Note 7 “Pension and Other Postretirement Benefits” and Note 11 “Hedging Activities and Fair Value Measurements.”
The before tax income (loss) and related income tax effect are as follows.
On January 1, 2019, the Company adopted ASU 2018-02 which reclassified stranded tax effects resulting from the Tax Cuts and Jobs Act from accumulated other comprehensive (loss) income to retained (deficit) earnings. The Company recorded a cumulative-effect adjustment which increased “Accumulated other comprehensive loss” in the Condensed Consolidated Balance Sheet by $8.2 million. Changes in accumulated other comprehensive (loss) income by component for the six month periods ended June 30, 2019 and 2018 are presented in the following table (1).
Reclassifications out of accumulated other comprehensive (loss) income for the six month periods ended June 30, 2019 and 2018 are presented in the following table:
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Hedging Activities and Fair Value Measurements |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Hedging Activities and Fair Value Measurements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Hedging Activities and Fair Value Measurements |
Note 11. Hedging Activities and Fair Value Measurements
Hedging Activities
The Company is exposed to certain market risks during the normal course of its business arising from adverse changes in interest rates and foreign currency exchange rates. The Company selectively uses derivative financial instruments (‘‘derivatives’’), including foreign currency forward contracts and interest rate swaps, to manage the risks from fluctuations in foreign currency exchange rates and interest rates, respectively. The Company does not purchase or hold derivatives for trading or speculative purposes. Fluctuations in interest rates and foreign currency exchange rates can be volatile, and the Company’s risk management activities do not totally eliminate these risks. Consequently, these fluctuations could have a significant effect on the Company’s financial results.
The Company’s exposure to interest rate risk results primarily from its variable-rate borrowings. The Company manages its debt centrally, considering tax consequences and its overall financing strategies. The Company manages its exposure to interest rate risk by maintaining a mixture of fixed and variable rate debt and, from time to time, using pay-fixed interest rate swaps as cash flow hedges of variable rate debt in order to adjust the relative fixed and variable proportions.
A substantial portion of the Company’s operations is conducted by its subsidiaries outside of the United States in currencies other than the USD. Almost all of the Company’s non-U.S. subsidiaries conduct their business primarily in their local currencies, which are also their functional currencies. Other than the USD, the EUR, GBP, and Chinese Renminbi are the principal currencies in which the Company and its subsidiaries enter into transactions. The Company is exposed to the impacts of changes in foreign currency exchange rates on the translation of its non-U.S. subsidiaries’ assets, liabilities and earnings into USD. The Company has certain U.S. subsidiaries borrow in currencies other than the USD.
The Company and its subsidiaries are also subject to the risk that arises when they, from time to time, enter into transactions in currencies other than their functional currency. To mitigate this risk, the Company and its subsidiaries typically settle intercompany trading balances monthly. The Company also selectively uses forward currency contracts to manage this risk. These contracts for the sale or purchase of European and other currencies generally mature within one year.
Derivative Instruments
The following table summarizes the notional amounts, fair values and classification of the Company’s outstanding derivatives by risk category and instrument type within the Condensed Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018.
Gains and losses on derivatives designated as cash flow hedges included in the Condensed Consolidated Statements of Comprehensive Income for the three and six month periods ended June 30, 2019 and 2018 are as presented in the table below.
As of June 30, 2019, the Company is the fixed rate payor on eight interest rate swap contracts that effectively fix the LIBOR-based index used to determine the interest rates charged on a total of $825.0 million of the Company’s LIBOR-based variable rate borrowings. These contracts carry fixed rates ranging from 3.3% to 4.3% and have expiration dates ranging from 2019 to 2020. These swap agreements qualify as hedging instruments and have been designated as cash flow hedges of forecasted LIBOR-based interest payments. Based on LIBOR-based swap yield curves as of June 30, 2019, the Company expects to reclassify losses of $18.3 million out of AOCI into earnings during the next 12 months. The Company’s LIBOR-based variable rate borrowings outstanding as of June 30, 2019 were $927.6 million and €604.2 million.
The Company had eight foreign currency forward contracts outstanding as of June 30, 2019 with notional amounts ranging from $7.6 million to $47.3 million. These contracts are used to hedge the change in fair value of recognized foreign currency denominated assets or liabilities caused by changes in currency exchange rates. The changes in the fair value of these contracts generally offset the changes in the fair value of a corresponding amount of the hedged items, both of which are included within “Other operating expense, net” in the Condensed Consolidated Statements of Operations. The Company’s foreign currency forward contracts are subject to master netting arrangements or agreements between the Company and each counterparty for the net settlement of all contracts through a single payment in a single currency in the event of default on or termination of any one contract with that certain counterparty. It is the Company’s practice to recognize the gross amounts in the Condensed Consolidated Balance Sheets. The amount available to be netted is not material.
The Company’s (losses) gains on derivative instruments not designated as accounting hedges and total net foreign currency (losses) gains for the three and six month periods ended June 30, 2019 and 2018 were as follows.
The Company has a significant investment in consolidated subsidiaries with functional currencies other than the USD, particularly the EUR. The Company designated its Original Euro Term Loan as a hedge of the Company’s net investment in subsidiaries with EUR functional currencies in 2017 until it was extinguished and replaced on August 17, 2017 by a €615.0 million Euro Term Loan, further described in Note 10 “Debt” to the consolidated financial statements in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2018. On August 17, 2017, the Company designated the €615.0 million Euro Term Loan as a hedge of the Company’s net investment in subsidiaries with EUR functional currencies. As of June 30, 2019, the Euro Term Loan of €604.2 million remained designated.
The Company’s (losses) and gains, net of income tax, associated with changes in the value of debt for the three and six month periods ended June 30, 2019 and 2018 and the net balance of such (losses) and gains included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018 were as follows.
For the periods presented, all cash flows associated with derivatives are classified as operating cash flows in the Condensed Consolidated Statements of Cash Flows.
Fair Value Measurements
A financial instrument is defined as cash or cash equivalents, evidence of an ownership interest in an entity, or a contract that creates a contractual obligation or right to deliver or receive cash or another financial instrument from another party. The Company’s financial instruments consist primarily of cash and cash equivalents, trade accounts receivables, trade accounts payables, deferred compensation assets and obligations, derivatives and debt instruments. The carrying values of cash and cash equivalents, trade accounts receivables, trade accounts payables, and variable rate debt instruments are a reasonable estimate of their respective fair values.
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or more advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value hierarchy is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value as follows.
The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2019.
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Revenue from Contracts with Customers |
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Revenue from Contracts with Customers |
Note 12. Revenue from Contracts with Customers
Overview
The Company recognizes revenue when the Company has satisfied its obligation and control is transferred to the customer. The amount of revenue recognized includes adjustments for any variable consideration, such as rebates, sales discounts, liquidated damages, etc., which are included in the transaction price, and allocated to each performance obligation. The variable consideration is estimated throughout the course of the contract using the Company’s best estimates. Judgments impacting variable consideration related to material rebate and sales discount programs, and significant contracts containing liquidated damage clauses are governed by management review processes.
The majority of the Company’s revenues are derived from short duration contracts and revenue is recognized at a single point in time when control is transferred to the customer, generally at shipment or when delivery has occurred or services have been rendered.
The Company has certain long duration engineered to order (‘‘ETO’’) contracts that require highly engineered solutions designed to customer specific applications. For contracts where the contractual deliverables have no alternative use and the contract termination clauses provide for the recovery of cost plus a reasonable margin, revenue is recognized over time based on the Company’s progress in satisfying the contractual performance obligations, generally measured as the ratio of actual costs incurred to date to the estimated total costs to complete the contract. For contracts with termination provisions that do not provide for recovery of cost and a reasonable margin, revenue is recognized at a point in time, generally at shipment or delivery to the customer. Identification of performance obligations, determination of alternative use, assessment of contractual language regarding termination provisions, and estimation of total project costs are all significant judgments required in the application of ASC 606.
Contractual specifications and requirements may be modified. The Company considers contract modifications to exist when the modification either creates new or changes the existing enforceable rights and obligations. In the event a contract modification is for goods or services that are not distinct in the contract, and therefore, form part of a single performance obligation that is partially satisfied as of the modification date, the effect of the contract modification on the transaction price and the Company’s measure of progress for the performance obligation to which it relates, is recognized on a cumulative catch-up basis.
Taxes assessed by a government authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Sales commissions are due at either collection of payment from customers or recognition of revenue. Applying the practical expedient from ASC 340-40-25-4, the Company recognizes the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that the Company otherwise would have recognized is one year or less. These costs are included in ‘‘Selling and administrative expenses’’ in the Condensed Consolidated Statements of Operations.
Disaggregation of Revenue
The following tables provide disaggregated revenue by reportable segment for the three month periods ended June 30, 2019 and 2018.
The following tables provide disaggregated revenue by reportable segment for the six month periods ended June 30, 2019 and 2018.
Performance Obligations
The majority of the Company’s contracts have a single performance obligation as the promise to transfer goods and/or services. For contracts with multiple performance obligations, the Company utilizes observable prices to determine standalone selling price or cost plus margin if a standalone price is not available. The Company has elected to account for shipping and handling activities as fulfillment costs and not a separate performance obligation. If control transfers and related revenue is recognized for the related good before the shipping and handling activities occur, the related costs of those shipping and handling activities are accrued.
The Company’s primary performance obligations include delivering standard or configured to order (“CTO”) goods to customers, designing and manufacturing a broad range of equipment customized to a customer’s specifications in ETO arrangements, rendering of services (maintenance and repair contracts), and certain extended or service type warranties. For incidental items that are immaterial in the context of the contract, costs are expensed as incurred or accrued at delivery.
As of June 30, 2019, for contracts with an original duration greater than one year, the Company expects to recognize revenue in the future related to unsatisfied (or partially satisfied) performance obligations of $218.9 million in the next twelve months and $50.5 million in periods thereafter. The performance obligations that are unsatisfied (or partially satisfied) are primarily related to orders for goods or services that were placed prior to the end of the reporting period and have not been delivered to the customer, on-going work on ETO contracts where revenue is recognized over time and service contracts with an original duration greater than one year.
Contract Balances
The following table provides the contract balances as of June 30, 2019 and December 31, 2018 presented in the Condensed Consolidated Balance Sheets.
Accounts receivable – Amounts due where the Company’s right to receive cash is unconditional.
Contract assets – The Company’s rights to consideration for the satisfaction of performance obligations subject to constraints apart from timing. Contract assets are transferred to receivables when the right to collect consideration becomes unconditional. Contract assets are presented net of progress billings and related advances from customers.
Contract liabilities – Advance payments received from customers for contracts for which revenue is not yet recognized. Contract liability balances are generally recognized in revenue within twelve months.
Contract assets and liabilities are reported on the Condensed Consolidated Balance Sheets on a contract-by-contract basis at the end of each reporting period. Contract assets and liabilities are presented net on a contract level, where required.
Payments from customer are generally due 30-60 days after invoicing. Invoicing for sales of standard products generally coincides with shipment or delivery of goods. Invoicing for CTO and ETO contracts typically follows a schedule for billing at contractual milestones. Payment milestones normally include down payments upon the contract signing, completion of product design, completion of customer’s preliminary inspection, shipment or delivery, completion of installation, and customer’s on-site inspection. The timing of revenue recognition, billings and cash collections results in billed accounts receivable, unbilled receivables (contract assets) and customer advances and deposits (contract liabilities) on the Condensed Consolidated Balance Sheets.
The Company has elected the practical expedient from ASC 606-10-32-18 and does not adjust the transaction price for the effects of a financing component if, at contract inception, the period between when the Company transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less.
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Income Taxes |
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Income Taxes [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes |
Note 13. Income Taxes
The following table summarizes the Company’s provision for income taxes and effective income tax provision rate for the three and six month periods ended June 30, 2019 and 2018.
The decrease in the provision for income taxes and decrease in the effective income tax provision rate for the three month period ended June 30, 2019 when compared to the same three month period of 2018 is primarily due to a decrease in the amount of earnings generated in countries with higher statutory tax rates and an increase in windfall tax benefits.
The decrease in the provision for income taxes and decrease in the effective income tax provision rate for the six month period ended June 30, 2019 when compared to the same six month period of 2018 is primarily due to a decrease in the amount of earnings generated in countries with higher statutory rates, an increase in windfall tax benefits and the Transition tax imposed under the Tax Cuts and Jobs Act of 2017.
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Leases |
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Leases |
Note 14. Leases
The Company adopted ASC 842 on January 1, 2019 using the optional transition method. See Note 1 “Condensed Consolidated Financial Statements” for further discussion of the adoption.
The Company has operating and financing leases for real estate, vehicles, IT equipment, office equipment and production equipment. The Company determines if an arrangement is a lease and identifies the classification of the lease as a financing lease or an operating lease at inception. Operating leases are recorded as operating lease right-of-use assets (“ROU assets”) in “Other assets” and operating lease liabilities in “Accrued liabilities” and “Other liabilities” in the Condensed Consolidated Balance Sheets. Financing leases are recorded as financing ROUs in “Property, plant and equipment” and lease liabilities in “Short-term borrowings and current maturities of long-term debt” and “Long-term debt, less current maturities” in the Condensed Consolidated Balance Sheets.
At the date of commencement, lease liabilities are recorded at the present value of the future minimum lease payments over the lease term. The lease term is equal to the initial term at commencement plus any renewal or extension options that the Company is reasonably certain will be exercised. ROU assets at the date of commencement are equal to the amount of the initial lease liability, the initial direct costs incurred by the Company and any prepaid lease payments less any incentives received.
Subsequent to the commencement date, operating lease liabilities are recorded at the present value of unpaid lease payments discounted at a discount rate established at the commencement date. Due to the absence of an implicit rate in the Company’s lease contracts, an incremental borrowing rate is used in the determination of the present value of future lease payments. Incremental borrowing rates for a lease are based on the lease term, lease currency and the Company’s credit spread. Operating ROU assets are recorded as the beginning balance less accumulated amortization with accumulated amortization equaling the straight-lined lease expense less the periodic accretion of the lease liability using the effective interest rate method.
Subsequent to the commencement date, financing lease liabilities are increased to reflect interest on the lease liability and decreased for principal lease payments made. The financing ROU asset is measured at cost less amortization expense and any accumulated impairment loss. Amortization expense is calculated on a straight-line basis over the lease term or remaining useful life.
The Company’s lease terms allow for the extension or termination of its leases and accounts for the extension and termination when it is reasonably certain that the Company will exercise the option or terminate the lease. Reassessment of the lease term occurs when there is a significant event or a significant change in circumstances that is within the control of the Company that directly affects whether the Company is reasonably certain to exercise or not to exercise an option to extend or terminate the lease or to purchase the underlying asset.
Contractual specifications and requirements may be modified. The Company considers contract modifications to exist when the modification includes a change to the contractual terms, scope of the lease or the consideration given. In the event that the right to use an additional asset is granted and the lease payments associated with the additional asset are commensurate with the ROU asset’s standalone price, the modification is accounted for as a separate contract and the original contract remains unchanged. In the event that a single lease is modified, the Company reassessed the classification of the modified lease as of the effective date of the modification based on the modified terms and accounts for initial direct costs, lease incentives and any other payments made to or by the Company in connection with the modification in the same manner that items would be accounted for in connection with a new lease. If there is an additional ROU asset included, the lease term is extended or reduced, or the consideration is the only change in the contract, the Company reallocates the remaining consideration in the contract and remeasures the lease liability using a discount rate determined at the effective date of the modification. The remeasured lease liability for the modified lease is an adjustment to the corresponding ROU asset and does not impact the Condensed Consolidated Statements of Operations. In the event of a full or partial termination, the carrying value of the ROU asset decreases on a basis proportionate to the full or partial termination and any difference between the reduction in the lease liability and the proportionate reduction of the ROU asset is recognized as a gain or loss at the effective date of the modification.
The Company elected not to recognize short-term leases on its balance sheet and continues to expense such leases.
The components of lease expense for the three and six month periods ended June 30, 2019 were as follows.
Supplemental cash flow information related to leases was as follows.
Supplemental balance sheet information related to leases was as follows.
Maturities of lease liabilities as of June 30, 2019 were as follows.
As of December 31, 2018, future minimum rental payments for operating leases for the five years subsequent to December 31, 2018 and thereafter were approximately $25.8 million, $19.5 million, $13.9 million, $7.7 million, $5.4 million and $9.4 million, respectively. As of December 31, 2018, future minimum rental payments for capital leases for the five years subsequent to December 31, 2018 and thereafter were approximately $0.8 million, $1.0 million, $1.1 million, $1.2 million, $1.4 million and $20.7 million.
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Supplemental Information |
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Supplemental Information |
Note 15. Supplemental Information
The components of “Other operating expense, net” for the three month and six month periods ended June 30, 2019 and 2018 were as follows.
Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2018 of $1.8 million and $5.2 million, respectively, reduced by a $2.6 million and $3.3 million decrease in the estimated accrual for employer taxes for the three month and six month periods ended June 30, 2018, respectively, as a result of the achievement of employer tax caps in countries outside of the United States.
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Contingencies |
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Jun. 30, 2019 | |
Contingencies [Abstract] | |
Contingencies |
Note 16. Contingencies
The Company is a party to various legal proceedings, lawsuits and administrative actions, which are of an ordinary or routine nature for a company of its size and sector. The Company believes that such proceedings, lawsuits and administrative actions will not materially adversely affect its operations, financial condition, liquidity or competitive position. A more detailed discussion of certain of these proceedings, lawsuits and administrative actions is set forth below.
Asbestos and Silica Related Litigation
The Company has been named as a defendant in a number of asbestos-related and silica-related personal injury lawsuits. The plaintiffs in these suits allege exposure to asbestos or silica from multiple sources and typically the Company is one of approximately 25 or more named defendants.
Predecessors to the Company sometimes manufactured, distributed and/or sold products allegedly at issue in the pending asbestos and silica-related lawsuits (the ‘‘Products’’). However, neither the Company nor its predecessors ever mined, manufactured, mixed, produced or distributed asbestos fiber or silica sand, the materials that allegedly caused the injury underlying the lawsuits. Moreover, the asbestos-containing components of the Products, if any, were enclosed within the subject Products.
Although the Company has never mined, manufactured, mixed, produced or distributed asbestos fiber or silica sand nor sold products that could result in a direct asbestos or silica exposure, many of the companies that did engage in such activities or produced such products are no longer in operation. This has led to law firms seeking potential alternative companies to name in lawsuits where there has been an asbestos or silica related injury.
The Company believes that the pending and future asbestos and silica-related lawsuits are not likely to, in the aggregate, have a material adverse effect on its consolidated financial position, results of operations or liquidity, based on: the Company’s anticipated insurance and indemnification rights to address the risks of such matters; the limited potential asbestos exposure from the Products described above; the Company’s experience that the vast majority of plaintiffs are not impaired with a disease attributable to alleged exposure to asbestos or silica from or relating to the Products or for which the Company otherwise bears responsibility; various potential defenses available to the Company with respect to such matters; and the Company’s prior disposition of comparable matters. However, inherent uncertainties of litigation and future developments, including, without limitation, potential insolvencies of insurance companies or other defendants, an adverse determination in the Adams County Case (discussed below), or other inability to collect from the Company’s historical insurers or indemnitors, could cause a different outcome. While the outcome of legal proceedings is inherently uncertain, based on presently known facts, experience, and circumstances, the Company believes that the amounts accrued on its balance sheet are adequate and that the liabilities arising from the asbestos and silica-related personal injury lawsuits will not have a material adverse effect on the Company’s consolidated financial position, results of operations or liquidity. ‘‘Accrued liabilities’’ and ‘‘Other liabilities’’ in the Condensed Consolidated Balance Sheets include a total litigation reserve of $102.3 million and $105.8 million as of June 30, 2019 and December 31, 2018, respectively, with regards to potential liability arising from the Company’s asbestos-related litigation. Asbestos related defense costs are excluded from the asbestos claims liability and are recorded separately as services are incurred. In the event of unexpected future developments, it is possible that the ultimate resolution of these matters may be material to the Company’s consolidated financial position, results of operation or liquidity.
The Company has entered into a series of agreements with certain of its or its predecessors’ legacy insurers and certain potential indemnitors to secure insurance coverage and/or reimbursement for the costs associated with the asbestos and silica-related lawsuits filed against the Company. The Company has also pursued litigation against certain insurers or indemnitors, where necessary. The Company has an insurance recovery receivable for probable asbestos related recoveries of approximately $102.8 million and $103.0 million as of June 30, 2019 and December 31, 2018, respectively, which was included in ‘‘Other assets’’ in the Condensed Consolidated Balance Sheets.
The largest such recent action, Gardner Denver, Inc. v. Certain Underwriters at Lloyd’s, London, et al., was filed on July 9, 2010, in the Eighth Judicial Circuit, Adams County, Illinois, as case number 10-L-48 (the ‘‘Adams County Case’’). In the lawsuit, the Company seeks, among other things, to require certain excess insurer defendants to honor their insurance policy obligations to the Company, including payment in whole or in part of the costs associated with the asbestos-related lawsuits filed against the Company. In October 2011, the Company reached a settlement with one of the insurer defendants, which had issued both primary and excess policies, for approximately the amount of such defendant’s policies that were subject to the lawsuit. Since then, the case has been proceeding through the discovery and motions process with the remaining insurer defendants. On January 29, 2016, the Company prevailed on the first phase of that discovery and motions process (‘‘Phase I’’). Specifically, the Court in the Adams County Case ruled that the Company has rights under all of the policies in the case, subject to their terms and conditions, even though the policies were sold to the Company’s former owners rather than to the Company itself. On June 9, 2016, the Court denied a motion by several of the insurers who sought permission to appeal the Phase I ruling immediately rather than waiting until the end of the whole case as is normally required. The case is now proceeding through the discovery process regarding the remaining issues in dispute (‘‘Phase II’’).
A majority of the Company’s expected future recoveries of the costs associated with the asbestos-related lawsuits are the subject of the Adams County Case.
The amounts recorded by the Company for asbestos-related liabilities and insurance recoveries are based on currently available information and assumptions that the Company believes are reasonable based on an evaluation of relevant factors. The actual liabilities or insurance recoveries could be higher or lower than those recorded if actual results vary significantly from the assumptions. There are a number of key variables and assumptions including the number and type of new claims to be filed each year, the resolution or outcome of these claims, the average cost of resolution of each new claim, the amount of insurance available, allocation methodologies, the contractual terms with each insurer with whom the Company has reached settlements, the resolution of coverage issues with other excess insurance carriers with whom the Company has not yet achieved settlements, and the solvency risk with respect to the Company’s insurance carriers. Other factors that may affect the future liability include uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, legal rulings that may be made by state and federal courts, and the passage of state or federal legislation. The Company makes the necessary adjustments for the asbestos liability and corresponding insurance recoveries on an annual basis unless facts or circumstances warrant assessment as of an interim date.
Environmental Matters
The Company has been identified as a potentially responsible party (‘‘PRP’’) with respect to several sites designated for cleanup under U.S. federal ‘‘Superfund’’ or similar state laws that impose liability for cleanup of certain waste sites and for related natural resource damages. Persons potentially liable for such costs and damages generally include the site owner or operator and persons that disposed or arranged for the disposal of hazardous substances found at those sites. Although these laws impose joint and several liability on PRPs, in application the PRPs typically allocate the investigation and cleanup costs based upon the volume of waste contributed by each PRP. Based on currently available information, the Company was only a small contributor to these waste sites, and the Company has, or is attempting to negotiate, de minimis settlements for their cleanup. The cleanup of the remaining sites is substantially complete and the Company’s future obligations entail a share of the sites’ ongoing operating and maintenance expense. The Company is also addressing four on-site cleanups for which it is the primary responsible party. Three of these cleanup sites are in the operation and maintenance stage and one is in the implementation stage.
The Company has undiscounted accrued liabilities of $6.8 million and $6.9 million as of June 30, 2019 and December 31, 2018, respectively, on its Condensed Consolidated Balance Sheets to the extent costs are known or can be reasonably estimated for its remaining financial obligations for the environmental matters discussed above and does not anticipate that any of these matters will result in material additional costs beyond amounts accrued. Based upon consideration of currently available information, the Company does not anticipate any material adverse effect on its results of operations, financial condition, liquidity or competitive position as a result of compliance with federal, state, local or foreign environmental laws or regulations, or cleanup costs relating to these matters.
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Segment Results [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Results |
Note 17. Segment Results
A description of the Company’s three reportable segments, including the specific products manufactured and sold follows below.
In the Industrials segment, the Company designs, manufactures, markets and services a broad range of air compression, vacuum and blower products across a wide array of technologies and applications. Almost every manufacturing and industrial facility, and many service and process industries, use air compression and vacuum products in a variety of applications such as operation of pneumatic air tools, vacuum packaging of food products and aeration of waste water. The Company maintains a leading position in its markets and serves customers globally. The Company offers comprehensive aftermarket parts and an experienced direct and distributor-based service network world-wide to complement all of its products.
In the Energy segment, the Company designs, manufactures, markets and services a diverse range of positive displacement pumps, liquid ring vacuum pumps and compressors, and engineered loading systems and fluid transfer equipment, consumables, and associated aftermarket parts and services. It serves customers in the upstream, midstream, and downstream oil and gas markets, and various other markets including petrochemical processing, power generation, transportation, and general industrial. The Company is one of the largest suppliers in these markets and has long-standing customer relationships. Its positive displacement pumps are used in the oilfield for drilling, hydraulic fracturing, completion and well servicing. Its liquid ring vacuum pumps and compressors are used in many power generation, mining, oil and gas refining and processing, chemical processing and general industrial applications including flare gas and vapor recovery, geothermal gas removal, vacuum de-aeration, enhanced oil recovery, water extraction in mining and paper and chlorine compression in petrochemical operations. Its engineered loading systems and fluid transfer equipment ensure the safe handling and transfer of crude oil, liquefied natural gas, compressed natural gas, chemicals, and bulk materials.
In the Medical segment, the Company designs, manufactures and markets a broad range of highly specialized gas, liquid and precision syringe pumps and compressors primarily for use in the medical, laboratory and biotechnology end markets. The Company’s customers are mainly medium and large durable medical equipment suppliers that integrate the Company’s products into their final equipment for use in applications such as oxygen therapy, blood dialysis, patient monitoring, wound treatment, and others. Further, with the recent acquisitions, the Company has expanded into liquid handling components and systems used in biotechnology applications including clinical analysis instrumentation. The Company also has a broad range of end use deep vacuum products for laboratory science applications.
The Chief Operating Decision Maker (‘‘CODM’’) evaluates the performance of the Company’s reportable segments based on, among other measures, Segment Adjusted EBITDA. Management closely monitors the Segment Adjusted EBITDA of each reportable segment to evaluate past performance and actions required to improve profitability. Inter-segment sales and transfers are not significant. Administrative expenses related to the Company’s corporate offices and shared service centers in the United States and Europe, which includes transaction processing, accounting and other business support functions, are allocated to the business segments. Certain administrative expenses, including senior management compensation, treasury, internal audit, tax compliance, certain information technology, and other corporate functions, are not allocated to the business segments.
The following table provides summarized information about the Company’s operations by reportable segment and reconciles Segment Adjusted EBITDA to Income Before Income Taxes for the three month and six month periods ended June 30, 2019 and 2018.
Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2018 of $1.8 million and $5.2 million, respectively, reduced by a $2.6 million and $3.3 million decrease in the estimated accrual for employer taxes for the three month and six month periods ended June 30, 2018, respectively, as a result of the achievement of employer tax caps in countries outside of the United States.
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Related Party Transactions |
6 Months Ended |
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Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions |
Note 18. Related Party Transactions
Affiliates of KKR participated as a lender in the Company’s Senior Secured Credit Facilities. KKR held a position in the Euro Term Loan Facility of €48.2 million as of June 30, 2019.
The Company entered into Amendment No. 4 to the Credit Agreement on June 28, 2019. See Note 8, “Debt” for further discussion of Amendment No 4. KKR Affiliates were a joint lead arranger and bookrunner of the Amendment. KKR Affiliates earned $0.4 million in structuring fees for the six month period ended June 30, 2019 for their involvement in the Amendment.
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Earnings Per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share |
Note 19. Earnings Per Share
The computations of basic and diluted earnings per share are as follows.
The DSUs described in Note 16, “Stock-Based Compensation Plans” to the consolidated financial statements in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2018 were considered outstanding shares for the purpose of computing basic earnings per share because they were issued solely upon the passage of time.
For the three month periods ended June 30, 2019 and 2018, there were 1.8 million and 0.8 million anti-dilutive shares that were not included in the computation of diluted earnings per share. For the six month periods ended June 30, 2019 and 2018, there were 1.8 million and 0.8 million anti-dilutive shares that were not included in the computation of diluted earnings per share.
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Subsequent Events |
6 Months Ended |
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Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events |
Note 20. Subsequent Events
On July 8, 2019, Gardner Denver Holdings, Inc acquired Oina VV AB (“Oina”), a company specializing in customized pump solutions for liquid handling processes for use in medical, process and industrial applications, for $10.0 million from cash on hand. The revenues and operating income of Oina will be included in the Medical segment.
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Condensed Consolidated Financial Statements (Policies) |
6 Months Ended |
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Jun. 30, 2019 | |
Condensed Consolidated Financial Statements [Abstract] | |
Basis of Presentation |
Basis of Presentation
Gardner Denver Holdings, Inc. is a holding company whose operating subsidiaries are Gardner Denver, Inc. (“GDI”) and certain of GDI’s subsidiaries. GDI is a diversified, global manufacturer of highly engineered, application-critical flow control products and provider of related aftermarket parts and services. The accompanying condensed consolidated financial statements include the accounts of Gardner Denver Holdings, Inc. and its majority-owned subsidiaries (collectively referred to herein as “Gardner Denver” or the “Company”). The financial information presented as of any date other than December 31, 2018 has been prepared from the books and records of the Company without audit. The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, the condensed consolidated financial statements include all adjustments, consisting of adjustments associated with acquisition accounting and normal recurring adjustments, necessary for the fair presentation of such financial statements. All intercompany transactions and accounts have been eliminated in consolidation.
The Company’s unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the Securities and Exchange Commission (“SEC”).
The results of operations for the interim periods ended June 30, 2019 are not necessarily indicative of the results to be expected for the full year. The balance sheet as of December 31, 2018 has been derived from the Company’s audited financial statements as of that date but does not include all of the information and notes required by GAAP for complete financial statements.
In May 2017, the Company sold a total of 47,495,000 shares of common stock in an initial public offering of shares of common stock. On November 15, 2017, May 2, 2018 and October 31, 2018, the Company completed secondary offerings of 25,300,000 shares, 30,533,478 and 20,000,000 shares, respectively, of common stock held by affiliates of Kohlberg Kravis Roberts & Co. L.P. (“KKR”). As a result of the secondary offerings, the Company is no longer considered a “controlled company” within the meaning of the corporate governance standards of the New York Stock Exchange (“NYSE”). KKR owns 70,671,135 shares of common stock, or approximately 35% of the total outstanding common stock based on the number of shares outstanding as of June 30, 2019.
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Recently Adopted Accounting Standard Updates ("ASU") |
Recently Adopted Accounting Standard Updates (“ASU”)
ASU 2016-02, Leases (Topic 842)
On January 1, 2019, the Company adopted Financial Accounting Standards Board (“FASB”) ASU 2016-02, Leases (Topic 842) (“ASC 842”) utilizing the optional transition method. The amendments in this update replaced most of the existing GAAP lease accounting guidance in order to increase transparency and comparability among organizations by recognizing right-of-use lease assets and lease liabilities on the balance sheet for those leases classified as operating leases under current GAAP. The amendments also expanded disclosure requirements for key information about leasing arrangements. The Company elected the package of practical expedients in transition for leases that commenced prior to January 1, 2019 whereby these contracts were not reassessed or reclassified from their previous assessment as of December 31, 2018. The Company updated its internal lease accounting policy to address the new standard, revised the Company’s business processes and controls and completed the implementation and data input for the Company’s lease accounting software solution. The most significant impact of the standard on the Company was the recognition of an approximate $61.3 million operating right of use (“ROU”) asset and an approximate $61.4 million operating lease liability on the Condensed Consolidated Balance Sheet. The standard did not have a material impact on both the Company’s Condensed Consolidated Statements of Operations and the Company’s Condensed Consolidated Statements of Cash Flows. See Note 14, “Leases” for further discussion of the Company’s operating and financing leases.
ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income
On January 1, 2019, the Company adopted FASB ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220) – Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (“ASU 2018-02”). The standard allowed a reclassification from accumulated other comprehensive (loss) income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act as of January 1, 2019. The Company recorded a cumulative-effect adjustment on the adoption date decreasing “Accumulated deficit” in the Condensed Consolidated Balance Sheets by $8.2 million and increasing “Accumulated other comprehensive loss” in the Condensed Consolidated Balance Sheets by $8.2 million.
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Recently Issued Accounting Pronouncements |
Recently Issued Accounting Pronouncements
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this update eliminate, add and modify certain disclosure requirements for fair value measurements as part of its disclosure framework project. The guidance is effective for public companies beginning in the first quarter of 2020. Early adoption is permitted. The Company is currently assessing the impact of this ASU on its condensed consolidated financial statements and evaluating the timing of adoption.
In August 2018, the FASB issued ASU 2018-14, Disclosure Framework – Changes to the Disclosure Requirements for Defined Benefit Plans. The amendments in this eliminate, add and modify certain disclosure requirements for defined benefit pension plans. The guidance is effective for public companies beginning with its annual report for fiscal year 2020. Early adoption is permitted. The Company is currently assessing the impact of this ASU on its condensed consolidated financial statements and evaluating the timing of adoption.
In August 2018, the FASB issued ASU 2018-15, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40); Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The amendments in this update require implementation costs incurred by customers in cloud computing arrangements (i.e., hosting arrangements) to be capitalized under the same premises of authoritative guidance for internal-use software, and deferred over the noncancellable term of the cloud computing arrangement plus any option renewal periods that are reasonably certain to be exercised by the customer or for which the exercise is controlled by the service provider. The Company is required to adopt this new guidance in the first quarter of 2020. Early adoption is permitted. The Company is currently assessing the impact of this ASU on its condensed consolidated financial statements and evaluating the timing of adoption.
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Business Combinations (Tables) |
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Business Combinations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue and Operating Income (Loss) of Acquisitions | The following table summarizes the revenue and operating income (loss) of these acquisitions for the periods presented subsequent to their date of acquisition.
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Restructuring (Tables) |
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Restructuring [Abstract] | ||||||||||||||||||||||||||||||||||||
Activity Associated With Restructuring Programs | The following table summarizes the activity associated with the Company’s restructuring programs for the six month period ended June 30, 2019.
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Inventories (Tables) |
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Inventories [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Inventories as of June 30, 2019 and December 31, 2018 consisted of the following.
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Goodwill and Other Intangible Assets (Tables) |
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Goodwill and Other Intangible Assets [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill Attributable to Each Reportable Segment |
The changes in the carrying amount of goodwill attributable to each reportable segment for the six month period ended June 30, 2019 is presented in the table below.
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Intangible Assets | Other intangible assets as of June 30, 2019 and December 31, 2018 consisted of the following.
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Amortization of Intangible Assets |
Amortization of intangible assets for the three and six month periods ended June 30, 2019 and 2018 were as follows.
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Accrued Liabilities (Tables) |
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Accrued Liabilities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Liabilities | Accrued liabilities as of June 30, 2019 and December 31, 2018 consisted of the following.
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Accrued Product Warranty Liability | A reconciliation of the changes in the accrued product warranty liability for the three and six month periods ended June 30, 2019 and 2018 are as follows.
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Pension and Other Postretirement Benefits (Tables) |
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Net Periodic Benefit Cost | The following table summarizes the components of net periodic benefit cost for the Company’s defined benefit pension plans and other postretirement benefit plans recognized for the three and six month periods ended June 30, 2019 and 2018.
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Debt (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt as of June 30, 2019 and December 31, 2018 is summarized as follows.
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Stock-Based Compensation (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Compensation [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Award Plan Activity | A summary of the Company’s stock option (including SARs) activity for the six month period ended June 30, 2019 is presented in the following table (underlying shares in thousands).
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Assumptions Used to Estimate Fair Value of Options Granted | The following assumptions were used to estimate the fair value of options granted (excluding previously disclosed modified awards) during the six month periods ended June 30, 2019 and 2018 using the Black-Scholes option-pricing model.
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Restricted Stock Unit Activity | A summary of the Company’s restricted stock unit activity for the six month period ended June 30, 2019 is presented in the following table (underlying shares in thousands).
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Accumulated Other Comprehensive (Loss) Income (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive (Loss) Income [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Comprehensive (Loss) Income | The before tax income (loss) and related income tax effect are as follows.
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Changes in Accumulated Other Comprehensive (Loss) Income | On January 1, 2019, the Company adopted ASU 2018-02 which reclassified stranded tax effects resulting from the Tax Cuts and Jobs Act from accumulated other comprehensive (loss) income to retained (deficit) earnings. The Company recorded a cumulative-effect adjustment which increased “Accumulated other comprehensive loss” in the Condensed Consolidated Balance Sheet by $8.2 million. Changes in accumulated other comprehensive (loss) income by component for the six month periods ended June 30, 2019 and 2018 are presented in the following table (1).
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Reclassifications out of Accumulated Other Comprehensive (Loss) Income | Reclassifications out of accumulated other comprehensive (loss) income for the six month periods ended June 30, 2019 and 2018 are presented in the following table:
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Hedging Activities and Fair Value Measurements (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Hedging Activities and Fair Value Measurements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type | The following table summarizes the notional amounts, fair values and classification of the Company’s outstanding derivatives by risk category and instrument type within the Condensed Consolidated Balance Sheets as of June 30, 2019 and December 31, 2018.
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Gains and Losses on Derivatives Designated as Cash Flow Hedges | Gains and losses on derivatives designated as cash flow hedges included in the Condensed Consolidated Statements of Comprehensive Income for the three and six month periods ended June 30, 2019 and 2018 are as presented in the table below.
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Losses on Derivative Instruments Not Designated as Accounting Hedges and Total Net Foreign Currency Losses | The Company’s (losses) gains on derivative instruments not designated as accounting hedges and total net foreign currency (losses) gains for the three and six month periods ended June 30, 2019 and 2018 were as follows.
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Changes in Value of Debt and Designated Interest Rate Swaps |
The Company’s (losses) and gains, net of income tax, associated with changes in the value of debt for the three and six month periods ended June 30, 2019 and 2018 and the net balance of such (losses) and gains included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018 were as follows.
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Assets and Liabilities Measured at Fair Value | The following table summarizes the Company’s financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2019.
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Revenue from Contracts with Customers (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contracts with Customers [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disaggregation of Revenue | The following tables provide disaggregated revenue by reportable segment for the three month periods ended June 30, 2019 and 2018.
The following tables provide disaggregated revenue by reportable segment for the six month periods ended June 30, 2019 and 2018.
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Contract Balances | The following table provides the contract balances as of June 30, 2019 and December 31, 2018 presented in the Condensed Consolidated Balance Sheets.
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Income Taxes (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision for Income Taxes and Effective Income Tax Rate | The following table summarizes the Company’s provision for income taxes and effective income tax provision rate for the three and six month periods ended June 30, 2019 and 2018.
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Leases (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Lease Expense | The components of lease expense for the three and six month periods ended June 30, 2019 were as follows.
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Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases was as follows.
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Supplemental Balance Sheet Information Related to Leases | Supplemental balance sheet information related to leases was as follows.
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Maturities of Lease Liabilities | Maturities of lease liabilities as of June 30, 2019 were as follows.
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Supplemental Information (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Information [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Operating Expense, Net |
The components of “Other operating expense, net” for the three month and six month periods ended June 30, 2019 and 2018 were as follows.
Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2018 of $1.8 million and $5.2 million, respectively, reduced by a $2.6 million and $3.3 million decrease in the estimated accrual for employer taxes for the three month and six month periods ended June 30, 2018, respectively, as a result of the achievement of employer tax caps in countries outside of the United States.
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Segment Results (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Results [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summarized Financial Information on Operations by Reportable Segment | The following table provides summarized information about the Company’s operations by reportable segment and reconciles Segment Adjusted EBITDA to Income Before Income Taxes for the three month and six month periods ended June 30, 2019 and 2018.
Represents stock-based compensation expense recognized for the three month and six month periods ended June 30, 2018 of $1.8 million and $5.2 million, respectively, reduced by a $2.6 million and $3.3 million decrease in the estimated accrual for employer taxes for the three month and six month periods ended June 30, 2018, respectively, as a result of the achievement of employer tax caps in countries outside of the United States.
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Earnings Per Share (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basic and Diluted Earning per Share | The computations of basic and diluted earnings per share are as follows.
|
Condensed Consolidated Financial Statements, Basis of Presentation (Details) - Common Stock [Member] - shares |
Oct. 31, 2018 |
May 02, 2018 |
Nov. 15, 2017 |
May 31, 2017 |
Jun. 30, 2019 |
---|---|---|---|---|---|
Stock Issued or Granted During Period [Abstract] | |||||
Stock sold in initial public offering (in shares) | 47,495,000 | ||||
Kohlberg Kravis Roberts & Co. L.P [Member] | |||||
Stock Issued or Granted During Period [Abstract] | |||||
Stock sold in initial public offering (in shares) | 20,000,000 | 30,533,478 | 25,300,000 | ||
Number of shares owned by non-controlling owners (in shares) | 70,671,135 | ||||
Ownership percentage by non-controlling owners | 35.00% |
Condensed Consolidated Financial Statements, Accounting Standards Updates (Details) - USD ($) $ in Millions |
Jun. 30, 2019 |
Dec. 31, 2018 |
Dec. 31, 2017 |
|||
---|---|---|---|---|---|---|
New Accounting Pronouncements [Abstract] | ||||||
Right to use asset | $ 57.3 | |||||
Operating lease liability | 57.6 | |||||
ASU 2016-02 [Member] | ||||||
New Accounting Pronouncements [Abstract] | ||||||
Right to use asset | 61.3 | |||||
Operating lease liability | $ 61.4 | |||||
ASU 2018-02 [Member] | Accumulated Deficit [Member] | ||||||
New Accounting Pronouncements [Abstract] | ||||||
Cumulative effect adjustment | $ 8.2 | $ 0.0 | ||||
ASU 2018-02 [Member] | Accumulated Other Comprehensive Loss [Member] | ||||||
New Accounting Pronouncements [Abstract] | ||||||
Cumulative effect adjustment | $ (8.2) | [1] | $ 0.0 | |||
|
Business Combinations (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 30, 2019 |
Dec. 12, 2018 |
Nov. 02, 2018 |
May 29, 2018 |
Feb. 08, 2018 |
Jun. 30, 2019 |
Mar. 31, 2019 |
Dec. 31, 2018 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
Dec. 31, 2020 |
Mar. 31, 2020 |
Dec. 31, 2019 |
|
Business Combinations [Abstract] | ||||||||||||||
Net cash paid to acquire business | $ 0.5 | $ 113.6 | ||||||||||||
Goodwill | $ 1,284.9 | $ 1,289.5 | 1,284.9 | |||||||||||
Revenues and Operating Income (Loss) [Abstract] | ||||||||||||||
Revenue | 29.2 | $ 15.7 | 55.0 | 23.6 | ||||||||||
Operating income (loss) | 4.6 | $ (0.9) | 6.6 | $ (2.0) | ||||||||||
MP Pumps, Inc. [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Total consideration | $ 58.5 | |||||||||||||
Cash consideration | 57.8 | |||||||||||||
Purchase price adjustment | 0.1 | 0.2 | ||||||||||||
Holdback recorded in accrued liabilities | 0.6 | 0.5 | 0.5 | |||||||||||
Net cash paid to acquire business | 0.5 | |||||||||||||
Goodwill deductible for tax purposes | $ 0.0 | |||||||||||||
DV Systems Inc [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Total consideration | $ 16.1 | |||||||||||||
Cash consideration | 14.8 | |||||||||||||
Increase in total consideration | $ 0.1 | |||||||||||||
Purchase price adjustment | $ 0.1 | |||||||||||||
Holdback recorded in accrued liabilities | 1.3 | |||||||||||||
Goodwill deductible for tax purposes | $ 0.0 | |||||||||||||
DV Systems Inc [Member] | Accrued Liabilities [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Holdback recorded in accrued liabilities | 0.9 | 0.9 | ||||||||||||
DV Systems Inc [Member] | Other Liabilities [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Holdback recorded in accrued liabilities | 0.5 | 0.5 | ||||||||||||
DV Systems Inc [Member] | Forecast [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Holdback recorded in accrued liabilities | $ 0.5 | $ 0.5 | $ 0.4 | |||||||||||
PMI Pump Parts [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Total consideration | $ 21.0 | |||||||||||||
Cash consideration | 18.8 | |||||||||||||
Contingent consideration payments | $ 1.0 | |||||||||||||
Promissory note | 2.0 | $ 1.0 | $ 1.0 | |||||||||||
Holdback recorded in accrued liabilities | 0.2 | |||||||||||||
Goodwill deductible for tax purposes | $ 0.0 | |||||||||||||
Runtech Systems Oy [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Percentage interest acquired | 100.00% | |||||||||||||
Net cash paid to acquire business | $ 94.9 | |||||||||||||
Goodwill | 63.6 | |||||||||||||
Amortizable intangible assets | 31.3 | |||||||||||||
Goodwill deductible for tax purposes | $ 0.0 | |||||||||||||
Ingersoll Rand [Member] | ||||||||||||||
Business Combinations [Abstract] | ||||||||||||||
Cash consideration | $ 1,900.0 | |||||||||||||
Percentage interest acquired | 50.10% |
Restructuring (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
Dec. 31, 2018 |
|||
Restructuring Costs [Abstract] | |||||||
Restructuring charges | [1] | $ 0.8 | $ 0.0 | $ 2.8 | $ 0.0 | ||
Restructuring Reserves [Abstract] | |||||||
Restructuring reserves included in accrued liabilities | 5.8 | 5.8 | $ 10.1 | ||||
Restructuring Programs 2018 [Member] | |||||||
Restructuring Program [Roll Forward] | |||||||
Balance at beginning of period | 10.1 | ||||||
Charged to expense - Termination benefits | 2.4 | ||||||
Charged to expense - Other | 0.4 | ||||||
Payments | (7.0) | ||||||
Other, net | (0.1) | ||||||
Balance at end of period | 5.8 | 5.8 | |||||
Restructuring Reserves [Abstract] | |||||||
Restructuring reserves included in accrued liabilities | $ 5.8 | 5.8 | $ 10.1 | ||||
Restructuring Programs 2018 [Member] | Other Operating Expense, Net [Member] | |||||||
Restructuring Costs [Abstract] | |||||||
Restructuring charges | 2.8 | ||||||
Restructuring Programs 2018 [Member] | Industrials [Member] | Other Operating Expense, Net [Member] | |||||||
Restructuring Costs [Abstract] | |||||||
Restructuring charges | 1.9 | ||||||
Restructuring Programs 2018 [Member] | Energy [Member] | Other Operating Expense, Net [Member] | |||||||
Restructuring Costs [Abstract] | |||||||
Restructuring charges | 1.1 | ||||||
Restructuring Programs 2018 [Member] | Medical [Member] | Other Operating Expense, Net [Member] | |||||||
Restructuring Costs [Abstract] | |||||||
Restructuring charges | $ (0.2) | ||||||
|
Inventories (Details) - USD ($) $ in Millions |
Jun. 30, 2019 |
Dec. 31, 2018 |
---|---|---|
Inventory, Net [Abstract] | ||
Raw materials, including parts and subassemblies | $ 403.4 | $ 369.2 |
Work-in-process | 59.9 | 58.1 |
Finished goods | 81.1 | 83.4 |
Total inventories | 544.4 | 510.7 |
Excess of LIFO costs over FIFO costs | 13.2 | 13.2 |
Inventories | $ 557.6 | $ 523.9 |
Goodwill and Other Intangible Assets (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
Dec. 31, 2018 |
|||
Goodwill [Roll Forward] | |||||||
Balance at beginning of period | $ 1,289.5 | ||||||
Foreign currency translation and other | (4.6) | ||||||
Balance at end of period | $ 1,284.9 | 1,284.9 | |||||
Goodwill impairment charges | 0.0 | $ 0.0 | |||||
Amortized intangible assets [Abstract] | |||||||
Accumulated amortization | (746.1) | (746.1) | $ (686.1) | ||||
Unamortized intangible assets [Abstract] | |||||||
Total other intangible assets | 2,049.9 | 2,049.9 | 2,054.5 | ||||
Amortization of Intangible Assets [Abstract] | |||||||
Intangible asset amortization expense | 30.9 | $ 31.5 | 62.3 | $ 62.4 | |||
Future Amortization of Intangible Assets [Abstract] | |||||||
2020 | 123.2 | 123.2 | |||||
2021 | 123.2 | 123.2 | |||||
2022 | 123.2 | 123.2 | |||||
2023 | 123.2 | 123.2 | |||||
2024 | 123.2 | 123.2 | |||||
Industrials [Member] | |||||||
Goodwill [Roll Forward] | |||||||
Balance at beginning of period | 632.7 | ||||||
Foreign currency translation and other | [1] | (2.2) | |||||
Balance at end of period | 630.5 | 630.5 | |||||
Correction of purchase accounting allocation | 0.2 | ||||||
Energy [Member] | |||||||
Goodwill [Roll Forward] | |||||||
Balance at beginning of period | 453.6 | ||||||
Foreign currency translation and other | (2.3) | ||||||
Balance at end of period | 451.3 | 451.3 | |||||
Accumulated goodwill impairment losses | 563.9 | 563.9 | |||||
Medical [Member] | |||||||
Goodwill [Roll Forward] | |||||||
Balance at beginning of period | 203.2 | ||||||
Foreign currency translation and other | (0.1) | ||||||
Balance at end of period | 203.1 | 203.1 | |||||
Trademarks [Member] | |||||||
Unamortized intangible assets [Abstract] | |||||||
Gross carrying amount | 610.4 | 610.4 | 611.3 | ||||
Customer Lists and Relationships [Member] | |||||||
Amortized intangible assets [Abstract] | |||||||
Gross carrying amount | 1,241.9 | 1,241.9 | 1,245.5 | ||||
Accumulated amortization | (620.9) | (620.9) | (567.8) | ||||
Technology [Member] | |||||||
Amortized intangible assets [Abstract] | |||||||
Gross carrying amount | 21.5 | 21.5 | 21.7 | ||||
Accumulated amortization | (5.3) | (5.3) | (4.8) | ||||
Trademarks [Member] | |||||||
Amortized intangible assets [Abstract] | |||||||
Gross carrying amount | 44.7 | 44.7 | 44.9 | ||||
Accumulated amortization | (14.6) | (14.6) | (13.0) | ||||
Backlog [Member] | |||||||
Amortized intangible assets [Abstract] | |||||||
Gross carrying amount | 68.6 | 68.6 | 68.8 | ||||
Accumulated amortization | (68.6) | (68.6) | (68.6) | ||||
Other [Member] | |||||||
Amortized intangible assets [Abstract] | |||||||
Gross carrying amount | 62.8 | 62.8 | 62.3 | ||||
Accumulated amortization | $ (36.7) | $ (36.7) | $ (31.9) | ||||
|
Accrued Liabilities (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||||
---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
Dec. 31, 2018 |
||||||
Accrued Liabilities [Abstract] | ||||||||||
Salaries, wages and related fringe benefits | $ 64.4 | $ 64.4 | $ 62.9 | |||||||
Restructuring | 5.8 | 5.8 | 10.1 | |||||||
Taxes | 21.5 | 21.5 | 24.3 | |||||||
Contract liabilities | 60.6 | 60.6 | 69.6 | |||||||
Product warranty | 23.4 | 23.4 | 23.9 | |||||||
Accrued interest | 0.7 | 0.7 | 0.3 | |||||||
Operating lease liabilities | [1] | 17.5 | 17.5 | 0.0 | ||||||
Other | 57.6 | 57.6 | 57.4 | |||||||
Total accrued liabilities | 251.5 | 251.5 | $ 248.5 | |||||||
Accrued Product Warranty Liability [Roll Forward] | ||||||||||
Balance at beginning of period | 21.8 | $ 24.3 | 23.9 | $ 22.3 | ||||||
Product warranty accruals | 7.8 | 5.5 | 14.6 | 11.6 | ||||||
Settlements | (6.3) | (5.2) | (15.1) | (10.6) | ||||||
Charged to other accounts | [2] | 0.1 | (0.7) | 0.0 | 0.6 | |||||
Balance at end of period | $ 23.4 | $ 23.9 | $ 23.4 | $ 23.9 | ||||||
|
Pension and Other Postretirement Benefits (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Pension Benefits [Member] | U.S. Plans [Member] | ||||
Net Periodic Benefit Cost [Abstract] | ||||
Service cost | $ 0.0 | $ 0.0 | $ 0.0 | $ 0.0 |
Interest cost | 0.6 | 0.5 | 1.1 | 1.0 |
Expected return on plan assets | (0.6) | (1.2) | (1.1) | (2.3) |
Recognition of [Abstract] | ||||
Unrecognized prior service cost | 0.0 | 0.0 | 0.0 | 0.0 |
Unrecognized net actuarial loss | 0.0 | 0.0 | 0.1 | 0.0 |
Total net periodic benefit (income) cost recognized | 0.0 | (0.7) | 0.1 | (1.3) |
Pension Benefits [Member] | Non-U.S. Plans [Member] | ||||
Net Periodic Benefit Cost [Abstract] | ||||
Service cost | 0.4 | 0.4 | 0.8 | 0.9 |
Interest cost | 1.9 | 1.9 | 3.9 | 3.8 |
Expected return on plan assets | (2.6) | (2.9) | (5.2) | (5.9) |
Recognition of [Abstract] | ||||
Unrecognized prior service cost | 0.1 | 0.0 | 0.1 | 0.0 |
Unrecognized net actuarial loss | 0.5 | 0.5 | 1.0 | 1.0 |
Total net periodic benefit (income) cost recognized | 0.3 | (0.1) | 0.6 | (0.2) |
Other Postretirement Benefits [Member] | ||||
Net Periodic Benefit Cost [Abstract] | ||||
Service cost | 0.0 | 0.0 | 0.0 | 0.0 |
Interest cost | 0.1 | 0.0 | 0.1 | 0.1 |
Expected return on plan assets | 0.0 | 0.0 | 0.0 | 0.0 |
Recognition of [Abstract] | ||||
Unrecognized prior service cost | 0.0 | 0.0 | 0.0 | 0.0 |
Unrecognized net actuarial loss | 0.0 | 0.0 | 0.0 | 0.0 |
Total net periodic benefit (income) cost recognized | $ 0.1 | $ 0.0 | $ 0.1 | $ 0.1 |
Debt, Summary of Debt (Details) - USD ($) $ in Millions |
6 Months Ended | 12 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Dec. 31, 2018 |
||||||||
Debt [Abstract] | |||||||||
Short-term borrowings | $ 0.0 | $ 0.0 | |||||||
Long-term debt [Abstract] | |||||||||
Unamortized debt issuance costs | (9.0) | (3.3) | |||||||
Total long-term debt, net, including current maturities | 1,631.5 | 1,672.1 | |||||||
Current maturities of long-term debt | 8.0 | 7.9 | |||||||
Total long-term debt, net | 1,623.5 | $ 1,664.2 | |||||||
Revolving Credit Facility, Due 2020 [Member] | |||||||||
Long-term debt [Abstract] | |||||||||
Debt instrument maturity date | Apr. 30, 2020 | ||||||||
Revolving Credit Facility, Due 2024 [Member] | |||||||||
Long-term debt [Abstract] | |||||||||
Long-term debt | [1] | $ 0.0 | $ 0.0 | ||||||
Debt instrument maturity date | Jun. 28, 2024 | ||||||||
Receivables Financing Agreement, Due 2020 [Member] | |||||||||
Long-term debt [Abstract] | |||||||||
Long-term debt | $ 0.0 | 0.0 | |||||||
Debt instrument maturity date | Jun. 30, 2020 | ||||||||
Term Loan Denominated in U.S. Dollars, Due 2024 [Member] | |||||||||
Long-term debt [Abstract] | |||||||||
Long-term debt | $ 927.6 | [2] | 952.6 | ||||||
Debt instrument maturity date | Dec. 31, 2024 | ||||||||
Interest rate | 5.15% | ||||||||
Weighted-average interest rate | 5.24% | ||||||||
Term Loan Denominated in Euros, Due 2024 [Member] | |||||||||
Long-term debt [Abstract] | |||||||||
Long-term debt | $ 686.9 | [3] | 696.5 | ||||||
Debt instrument maturity date | Dec. 31, 2024 | ||||||||
Interest rate | 3.00% | ||||||||
Weighted-average interest rate | 3.00% | ||||||||
Capitalized Leases and Other Long-Term Debt [Member] | |||||||||
Long-term debt [Abstract] | |||||||||
Long-term debt | $ 26.0 | $ 26.3 | |||||||
|
Debt (Details) € in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2019
USD ($)
|
Mar. 31, 2019
USD ($)
|
Jun. 30, 2019
USD ($)
|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2019
EUR (€)
|
Jun. 30, 2019
USD ($)
|
Jun. 28, 2019
USD ($)
|
|
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Principal payment of outstanding borrowings | $ 28.8 | $ 110.5 | |||||
LIBOR [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Outstanding borrowing | € 604.2 | $ 927.6 | |||||
Receivables Financing Agreement [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Outstanding borrowing | 0.0 | ||||||
Letters of credit outstanding | 26.7 | ||||||
Remaining borrowing capacity | 76.4 | ||||||
Term Loan Denominated in U.S. Dollars, Due 2024 [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Principal payment of outstanding borrowings | $ 25.0 | ||||||
Senior Secured Credit Facility [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Aggregate principal amount | $ 450.0 | ||||||
Revolving Credit Facility [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Outstanding borrowing | 0.0 | ||||||
Letters of credit outstanding | 5.0 | ||||||
Unused availability | 445.0 | ||||||
Write-off of unamortized debt issuance costs | $ 0.2 | $ 0.2 | |||||
Revolving Credit Facility [Member] | Ingersoll Rand [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Letters of credit outstanding | 400.0 | ||||||
Aggregate principal amount | $ 1,000.0 | ||||||
Revolving Credit Facility [Member] | LIBOR [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Basis spread on variable rate | 2.25% | ||||||
Revolving Credit Facility [Member] | Base Rate [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Basis spread on variable rate | 1.25% | ||||||
Revolving Credit Facility [Member] | Letter of Credit [Member] | |||||||
Debt Instrument, Receivables Financing Agreement [Abstract] | |||||||
Maximum borrowing capacity | $ 200.0 |
Stock-Based Compensation, Stock-Based Award Plan Activity (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
Dec. 31, 2018 |
|
Share-based Compensation Arrangement [Abstract] | |||||
Stock-based compensation expense | $ 6.0 | $ 1.8 | $ 13.6 | $ 5.2 | |
Accrued liabilities | 251.5 | 251.5 | $ 248.5 | ||
Stock Options [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Unrecognized compensation expense | 35.0 | 35.0 | |||
Restricted Stock Awards [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Unrecognized compensation expense | 35.0 | 35.0 | |||
2013 Stock Incentive Plan [Member] | Stock Appreciation Rights (SARs) [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Accrued liabilities | $ 11.2 | 11.2 | |||
2013 and 2017 Plan [Member] | Former Employee [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Stock-based compensation expense | 0.7 | ||||
2013 and 2017 Plan [Member] | Equity Awards [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Stock-based compensation expense | 5.0 | ||||
2013 and 2017 Plan [Member] | Stock Appreciation Rights (SARs) [Member] | |||||
Share-based Compensation Arrangement [Abstract] | |||||
Increase in liability | $ 7.9 |
Stock-Based Compensation, Stock Option Awards (Details) - Stock Options and Stock Appreciation Rights [Member] shares in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2019
$ / shares
shares
| |
Shares [Roll Forward] | |
Outstanding, beginning balance (in shares) | shares | 12,352 |
Granted (in shares) | shares | 1,070 |
Exercised or settled (in shares) | shares | (3,890) |
Forfeited (in shares) | shares | (90) |
Expired (in shares) | shares | (9) |
Outstanding, ending balance (in shares) | shares | 9,433 |
Vested (in shares) | shares | 7,266 |
Outstanding Weighted-Average Exercise Price [Abstract] | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 10.93 |
Granted (in dollars per share) | $ / shares | 27.05 |
Exercised or settled (in dollars per share) | $ / shares | 8.72 |
Forfeited (in dollars per share) | $ / shares | 30.42 |
Expired (in dollars per share) | $ / shares | 32.06 |
Outstanding, ending balance (in dollars per share) | $ / shares | 13.46 |
Vested (in dollars per share) | $ / shares | $ 9.61 |
Stock-Based Compensation, Assumptions Used to Estimate Fair Value of Options Granted (Details) - Stock Options [Member] |
6 Months Ended | |
---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Assumptions [Abstract] | ||
Expected life of options | 6 years 3 months 18 days | |
Expected dividend rate | 0.00% | 0.00% |
Minimum [Member] | ||
Assumptions [Abstract] | ||
Expected life of options | 7 years | |
Risk-free interest rate | 2.40% | 2.90% |
Assumed volatility | 30.70% | 34.40% |
Maximum [Member] | ||
Assumptions [Abstract] | ||
Expected life of options | 7 years 6 months | |
Risk-free interest rate | 2.60% | 3.00% |
Assumed volatility | 31.80% | 35.40% |
Stock-Based Compensation, Restricted Stock Unit Awards (Details) - Restricted Stock Unit [Member] shares in Thousands |
6 Months Ended |
---|---|
Jun. 30, 2019
$ / shares
shares
| |
Shares [Roll Forward] | |
Non-vested, beginning balance (in shares) | shares | 362 |
Granted (in shares) | shares | 418 |
Vested (in shares) | shares | (33) |
Forfeited (in shares) | shares | (38) |
Non-vested, ending balance (in shares) | shares | 709 |
Weighted-Average Grant-Date Fair Value [Abstract] | |
Non-vested, beginning balance (in dollars per share) | $ / shares | $ 31.78 |
Granted (in dollars per share) | $ / shares | 27.05 |
Vested (in dollars per share) | $ / shares | 31.97 |
Forfeited (in dollars per share) | $ / shares | 31.56 |
Non-vested, ending balance (in dollars per share) | $ / shares | $ 28.97 |
Accumulated Other Comprehensive (Loss) Income, Accumulated Other Comprehensive (Loss) Income Balances (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|||||
Before-Tax Amount [Abstract] | ||||||||
Foreign currency translation adjustments, net | $ (8.6) | $ (58.1) | $ (4.1) | $ (28.5) | ||||
Unrecognized (losses) gains on cash flow hedges, net | (0.7) | 6.2 | 0.6 | 21.3 | ||||
Pension and other postretirement benefit prior service cost and gain or loss, net | 1.3 | 3.3 | 1.5 | 2.1 | ||||
Other comprehensive loss | (8.0) | (48.6) | (2.0) | (5.1) | ||||
Tax (Expense) or Benefit [Abstract] | ||||||||
Foreign currency translation adjustments, net | 2.2 | (9.4) | (2.4) | (4.6) | ||||
Unrecognized (losses) gains on cash flow hedges, net | 0.2 | (1.5) | 0.8 | (5.2) | ||||
Pension and other postretirement benefit prior service cost and gain or loss, net | (0.1) | (0.6) | (0.1) | 1.0 | ||||
Other comprehensive loss | 2.3 | (11.5) | (1.7) | (8.8) | ||||
Net of Tax Amount [Abstract] | ||||||||
Foreign currency translation adjustments, net | (6.4) | (67.5) | (6.5) | (33.1) | ||||
Unrecognized (losses) gains on cash flow hedges, net | (0.5) | 4.7 | 1.4 | 16.1 | ||||
Pension and other postretirement benefit prior service cost and gain or loss, net | 1.2 | 2.7 | 1.4 | 3.1 | ||||
Total other comprehensive loss, net of tax | $ (5.7) | $ (60.1) | $ (3.7) | [1] | $ (13.9) | [1] | ||
|
Accumulated Other Comprehensive (Loss) Income, Changes in Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
Dec. 31, 2018 |
Dec. 31, 2017 |
||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Other comprehensive (loss) income before reclassifications | [1] | $ (10.4) | $ (20.7) | ||||||||||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 6.7 | 6.8 | ||||||||||
Total other comprehensive loss, net of tax | $ (5.7) | $ (60.1) | (3.7) | [1] | (13.9) | [1] | |||||||
Accumulated Other Comprehensive Income (Loss) [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Beginning balance | [1] | (247.0) | (199.8) | ||||||||||
Ending balance | [1] | (258.9) | (213.4) | (258.9) | (213.4) | ||||||||
Accumulated Other Comprehensive Income (Loss) [Member] | ASU 2018-02 [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | $ (8.2) | [1] | $ 0.0 | ||||||||||
Accumulated Other Comprehensive Income (Loss) [Member] | ASU 2017-12 [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | 0.0 | 0.3 | [1] | ||||||||||
Foreign Currency Translation Adjustments, Net [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Beginning balance | [1] | (190.6) | (129.6) | ||||||||||
Other comprehensive (loss) income before reclassifications | [1] | (6.5) | (33.1) | ||||||||||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 0.0 | 0.0 | ||||||||||
Total other comprehensive loss, net of tax | [1] | (6.5) | (33.1) | ||||||||||
Ending balance | [1] | (198.6) | (162.7) | (198.6) | (162.7) | ||||||||
Foreign Currency Translation Adjustments, Net [Member] | ASU 2018-02 [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | (1.5) | |||||||||||
Foreign Currency Translation Adjustments, Net [Member] | ASU 2017-12 [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | 0.0 | |||||||||||
Unrealized (Losses) Gains on Cash Flow Hedges [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Beginning balance | [1] | (11.4) | (29.8) | ||||||||||
Other comprehensive (loss) income before reclassifications | [1] | (4.4) | 10.1 | ||||||||||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 5.8 | 6.0 | ||||||||||
Total other comprehensive loss, net of tax | [1] | 1.4 | 16.1 | ||||||||||
Ending balance | [1] | (16.7) | (13.4) | (16.7) | (13.4) | ||||||||
Unrealized (Losses) Gains on Cash Flow Hedges [Member] | ASU 2018-02 [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | (6.7) | |||||||||||
Unrealized (Losses) Gains on Cash Flow Hedges [Member] | ASU 2017-12 [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | 0.3 | |||||||||||
Pension and Postretirement Benefit Plans [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Beginning balance | [1] | (45.0) | (40.4) | ||||||||||
Other comprehensive (loss) income before reclassifications | [1] | 0.5 | 2.3 | ||||||||||
Amounts reclassified from accumulated other comprehensive (loss) income | [1] | 0.9 | 0.8 | ||||||||||
Total other comprehensive loss, net of tax | [1] | 1.4 | 3.1 | ||||||||||
Ending balance | [1] | $ (43.6) | $ (37.3) | $ (43.6) | $ (37.3) | ||||||||
Pension and Postretirement Benefit Plans [Member] | ASU 2018-02 [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | $ 0.0 | |||||||||||
Pension and Postretirement Benefit Plans [Member] | ASU 2017-12 [Member] | |||||||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||||||
Cumulative effect adjustment upon adoption of new accounting standard | [1] | $ 0.0 | |||||||||||
|
Accumulated Other Comprehensive (Loss) Income, Reclassifications out of Accumulated Other Comprehensive (Loss) Income (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|||
Income Statement [Abstract] | ||||||
Interest expense | $ 22.4 | $ 26.1 | $ 44.8 | $ 52.1 | ||
Total before tax | 53.2 | 77.5 | 112.4 | 143.4 | ||
Income tax benefit | (8.3) | (17.2) | (20.3) | (40.7) | ||
Net of tax | $ 44.9 | $ 60.3 | 92.1 | 102.7 | ||
Reclassification out of Accumulated Other Comprehensive (Loss) Income [Member] | ||||||
Income Statement [Abstract] | ||||||
Net of tax | 6.7 | 6.8 | ||||
Loss on Cash Flow Hedges - Interest Rate Swaps [Member] | Reclassification out of Accumulated Other Comprehensive (Loss) Income [Member] | ||||||
Income Statement [Abstract] | ||||||
Interest expense | 7.6 | 7.9 | ||||
Total before tax | 7.6 | 7.9 | ||||
Income tax benefit | (1.8) | (1.9) | ||||
Net of tax | 5.8 | 6.0 | ||||
Amortization of Defined Benefit Pension and Other Postretirement Benefit Items [Member] | Reclassification out of Accumulated Other Comprehensive (Loss) Income [Member] | ||||||
Income Statement [Abstract] | ||||||
Net periodic benefit cost | [1] | 1.2 | 1.0 | |||
Total before tax | 1.2 | 1.0 | ||||
Income tax benefit | (0.3) | (0.2) | ||||
Net of tax | $ 0.9 | $ 0.8 | ||||
|
Hedging Activities and Fair Value Measurements, Hedging Activities and Derivative Instruments within the Condensed Consolidated Balance Sheets (Details) - USD ($) $ in Millions |
6 Months Ended | ||||
---|---|---|---|---|---|
Jun. 30, 2019 |
Dec. 31, 2018 |
||||
Maximum [Member] | |||||
Derivative, Fair Value, Net [Abstract] | |||||
Maturity period of foreign currency contracts | 1 year | ||||
Interest Rate Swap Contracts [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Notional amount | [1] | $ 825.0 | $ 925.0 | ||
Interest Rate Swap Contracts [Member] | Other Current Assets [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Assets fair value | [1] | 0.0 | 0.0 | ||
Interest Rate Swap Contracts [Member] | Other Assets [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Assets fair value | [1] | 0.0 | 0.0 | ||
Interest Rate Swap Contracts [Member] | Accrued Liabilities [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Liabilities fair value | [1] | 7.4 | 11.2 | ||
Interest Rate Swap Contracts [Member] | Other Liabilities [Member] | Derivatives Designated as Hedging Instruments [Member] | Cash Flow [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Liabilities fair value | [1] | 13.2 | 8.7 | ||
Foreign Currency Forwards [Member] | Maximum [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Notional amount | 47.3 | ||||
Foreign Currency Forwards [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Notional amount | [1] | 123.5 | 143.3 | ||
Foreign Currency Forwards [Member] | Other Current Assets [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Assets fair value | [1] | 0.8 | 1.3 | ||
Foreign Currency Forwards [Member] | Other Assets [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Assets fair value | [1] | 0.0 | 0.0 | ||
Foreign Currency Forwards [Member] | Accrued Liabilities [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Liabilities fair value | [1] | 0.0 | 0.0 | ||
Foreign Currency Forwards [Member] | Other Liabilities [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Liabilities fair value | [1] | 0.0 | 0.0 | ||
Foreign Currency Forwards [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Notional amount | [1] | 71.8 | 27.5 | ||
Foreign Currency Forwards [Member] | Other Current Assets [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Assets fair value | [1] | 0.0 | 0.0 | ||
Foreign Currency Forwards [Member] | Other Assets [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Assets fair value | [1] | 0.0 | 0.0 | ||
Foreign Currency Forwards [Member] | Accrued Liabilities [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Liabilities fair value | [1] | 1.5 | 0.1 | ||
Foreign Currency Forwards [Member] | Other Liabilities [Member] | Derivatives Not Designated as Hedging Instruments [Member] | Fair Value [Member] | |||||
Notional Amounts, Fair Values and Classification of Outstanding Derivatives by Risk Category and Instrument Type [Abstract] | |||||
Liabilities fair value | [1] | $ 0.0 | $ 0.0 | ||
|
Hedging Activities and Fair Value Measurements, Derivative Instruments included in the Condensed Consolidated Statements of Comprehensive (Loss) Income (Details) - Interest Rate Swap Contracts [Member] - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|||
Gains and Losses on Derivatives Designated as Cash Flow Hedges [Abstract] | ||||||
(Loss) gain recognized in AOCI on derivatives | $ (4.6) | $ 3.1 | $ (7.0) | $ 13.4 | ||
Loss reclassified from AOCI into income (effective portion) | [1] | $ (3.9) | $ (3.1) | $ (7.6) | $ (7.9) | |
|
Hedging Activities and Fair Value Measurements, Interest Rate Swap Contracts (Details) € in Millions, $ in Millions |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2019
USD ($)
|
Jun. 30, 2019
EUR (€)
Contract
|
Jun. 30, 2019
USD ($)
Contract
|
|
Derivative, Fair Value, Net [Abstract] | |||
Number of contracts | Contract | 8 | 8 | |
LIBOR [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Expected losses to be reclassified out of AOCI into earnings during next 12 months | $ | $ 18.3 | ||
Long-term debt outstanding | € 604.2 | $ 927.6 | |
Interest Rate Swap Contracts [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Number of contracts | Contract | 8 | 8 | |
Interest Rate Swap Contracts [Member] | LIBOR [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Long-term debt hedged | $ | $ 825.0 | ||
Interest Rate Swap Contracts [Member] | LIBOR [Member] | Minimum [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Fixed interest rate | 3.30% | 3.30% | |
Interest Rate Swap Contracts [Member] | LIBOR [Member] | Maximum [Member] | |||
Derivative, Fair Value, Net [Abstract] | |||
Fixed interest rate | 4.30% | 4.30% |
Hedging Activities and Fair Value Measurements, Foreign Currency Forward Contracts (Details) $ in Millions |
Jun. 30, 2019
USD ($)
Contract
|
---|---|
Derivative, Fair Value, Net [Abstract] | |
Number of contracts | Contract | 8 |
Foreign Currency Forwards [Member] | Minimum [Member] | |
Derivative, Fair Value, Net [Abstract] | |
Notional amount | $ 7.6 |
Foreign Currency Forwards [Member] | Maximum [Member] | |
Derivative, Fair Value, Net [Abstract] | |
Notional amount | $ 47.3 |
Hedging Activities and Fair Value Measurements, Derivative Instruments not Designated as Accounting Hedges (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Derivative instruments not designated as accounting hedges [Abstract] | ||||
Total foreign currency transaction (losses) gains, net | $ (0.6) | $ 2.4 | $ (3.7) | $ (0.2) |
Foreign Currency Forward Contracts (Losses) Gains [Member] | ||||
Derivative instruments not designated as accounting hedges [Abstract] | ||||
Total foreign currency transaction (losses) gains, net | $ (2.2) | $ 7.3 | $ (3.8) | $ 6.2 |
Hedging Activities and Fair Value Measurements, Investment in Consolidated Subsidiaries with Functional Currencies Other than USD (Details) € in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Jun. 30, 2019
USD ($)
|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2019
USD ($)
|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2019
EUR (€)
|
Jun. 30, 2019
USD ($)
|
Aug. 17, 2017
EUR (€)
|
|
Euro Term Loan [Member] | |||||||
Derivative, Fair Value, Net [Abstract] | |||||||
Long-term debt hedged | € | € 604.2 | € 615.0 | |||||
Interest Rate Swap Contracts [Member] | |||||||
Changes in the value of debt and designated interest rate swaps [Abstract] | |||||||
(Loss) gain, net of income tax, recorded through other comprehensive income | $ (7.0) | $ 29.7 | $ 4.7 | $ 14.5 | |||
Balance included in accumulated other comprehensive (loss) income as of June 30, 2019 and 2018, respectively | $ 46.7 | $ 46.7 | $ 61.3 |
Hedging Activities and Fair Value Measurements, Fair Value Measurements (Details) - Recurring [Member] $ in Millions |
Jun. 30, 2019
USD ($)
|
|||||||
---|---|---|---|---|---|---|---|---|
Financial Assets [Abstract] | ||||||||
Foreign currency forwards | $ 0.8 | [1] | ||||||
Trading securities held in deferred compensation plan | 6.5 | [2] | ||||||
Total | 7.3 | |||||||
Financial Liabilities [Abstract] | ||||||||
Foreign currency forwards | 1.5 | [1] | ||||||
Interest rate swaps | 20.6 | [3] | ||||||
Deferred compensation plan | 6.5 | [2] | ||||||
Total | 28.6 | |||||||
Level 1 [Member] | ||||||||
Financial Assets [Abstract] | ||||||||
Foreign currency forwards | 0.0 | [1] | ||||||
Trading securities held in deferred compensation plan | 6.5 | [2] | ||||||
Total | 6.5 | |||||||
Financial Liabilities [Abstract] | ||||||||
Foreign currency forwards | 0.0 | [1] | ||||||
Interest rate swaps | 0.0 | [3] | ||||||
Deferred compensation plan | 6.5 | [2] | ||||||
Total | 6.5 | |||||||
Level 2 [Member] | ||||||||
Financial Assets [Abstract] | ||||||||
Foreign currency forwards | 0.8 | [1] | ||||||
Trading securities held in deferred compensation plan | 0.0 | [2] | ||||||
Total | 0.8 | |||||||
Financial Liabilities [Abstract] | ||||||||
Foreign currency forwards | 1.5 | [1] | ||||||
Interest rate swaps | 20.6 | [3] | ||||||
Deferred compensation plan | 0.0 | [2] | ||||||
Total | 22.1 | |||||||
Level 3 [Member] | ||||||||
Financial Assets [Abstract] | ||||||||
Trading securities held in deferred compensation plan | 0.0 | [2] | ||||||
Financial Liabilities [Abstract] | ||||||||
Foreign currency forwards | 0.0 | [1] | ||||||
Interest rate swaps | 0.0 | [3] | ||||||
Deferred compensation plan | 0.0 | [2] | ||||||
Total | $ 0.0 | |||||||
|
Revenue from Contracts with Customers, Disaggregation of Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | $ 629.1 | $ 668.2 | $ 1,249.4 | $ 1,287.7 | |||||||||
Revenue Recognized at Point in Time [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [1] | 597.7 | 639.4 | 1,190.5 | 1,246.3 | ||||||||
Revenue Recognized over Time [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [2] | 31.4 | 28.8 | 58.9 | 41.4 | ||||||||
Original Equipment [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [3] | 394.0 | 408.4 | 769.3 | 773.4 | ||||||||
Aftermarket [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [4] | 235.1 | 259.8 | 480.1 | 514.3 | ||||||||
Total Americas [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 320.1 | 334.5 | 633.3 | 661.2 | |||||||||
United States [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 274.0 | 288.9 | 543.2 | 566.0 | |||||||||
Other Americas [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 46.1 | 45.6 | 90.1 | 95.2 | |||||||||
EMEA [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 209.3 | 237.6 | 433.6 | 450.7 | |||||||||
Asia Pacific [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 99.7 | 96.1 | 182.5 | 175.8 | |||||||||
Industrials [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 334.3 | 328.7 | 652.4 | 645.6 | |||||||||
Industrials [Member] | Revenue Recognized at Point in Time [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [1] | 322.9 | 314.1 | 630.4 | 621.6 | ||||||||
Industrials [Member] | Revenue Recognized over Time [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [2] | 11.4 | 14.6 | 22.0 | 24.0 | ||||||||
Industrials [Member] | Original Equipment [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [3] | 231.0 | 225.6 | 450.7 | 441.2 | ||||||||
Industrials [Member] | Aftermarket [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [4] | 103.3 | 103.1 | 201.7 | 204.4 | ||||||||
Industrials [Member] | Total Americas [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 129.2 | 108.0 | 249.0 | 219.6 | |||||||||
Industrials [Member] | United States [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 103.4 | 91.0 | 202.1 | 181.4 | |||||||||
Industrials [Member] | Other Americas [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 25.8 | 17.0 | 46.9 | 38.2 | |||||||||
Industrials [Member] | EMEA [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 155.8 | 164.6 | 308.0 | 325.6 | |||||||||
Industrials [Member] | Asia Pacific [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 49.3 | 56.1 | 95.4 | 100.4 | |||||||||
Energy [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 222.8 | 273.1 | 455.9 | 515.3 | |||||||||
Energy [Member] | Revenue Recognized at Point in Time [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [1] | 202.8 | 258.9 | 419.0 | 497.9 | ||||||||
Energy [Member] | Revenue Recognized over Time [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [2] | 20.0 | 14.2 | 36.9 | 17.4 | ||||||||
Energy [Member] | Original Equipment [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [3] | 92.7 | 118.6 | 181.5 | 210.0 | ||||||||
Energy [Member] | Aftermarket [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [4] | 130.1 | 154.5 | 274.4 | 305.3 | ||||||||
Energy [Member] | Total Americas [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 160.1 | 201.2 | 325.2 | 394.1 | |||||||||
Energy [Member] | United States [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 140.1 | 173.1 | 282.9 | 338.5 | |||||||||
Energy [Member] | Other Americas [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 20.0 | 28.1 | 42.3 | 55.6 | |||||||||
Energy [Member] | EMEA [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 25.9 | 45.2 | 69.8 | 70.4 | |||||||||
Energy [Member] | Asia Pacific [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 36.8 | 26.7 | 60.9 | 50.8 | |||||||||
Medical [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 72.0 | 66.4 | 141.1 | 126.8 | |||||||||
Medical [Member] | Revenue Recognized at Point in Time [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [1] | 72.0 | 66.4 | 141.1 | 126.8 | ||||||||
Medical [Member] | Revenue Recognized over Time [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [2] | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||
Medical [Member] | Original Equipment [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [3] | 70.3 | 64.2 | 137.1 | 122.2 | ||||||||
Medical [Member] | Aftermarket [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | [4] | 1.7 | 2.2 | 4.0 | 4.6 | ||||||||
Medical [Member] | Total Americas [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 30.8 | 25.3 | 59.1 | 47.5 | |||||||||
Medical [Member] | United States [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 30.5 | 24.8 | 58.2 | 46.1 | |||||||||
Medical [Member] | Other Americas [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 0.3 | 0.5 | 0.9 | 1.4 | |||||||||
Medical [Member] | EMEA [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | 27.6 | 27.8 | 55.8 | 54.7 | |||||||||
Medical [Member] | Asia Pacific [Member] | |||||||||||||
Disaggregation of Revenue [Abstract] | |||||||||||||
Disaggregated revenue | $ 13.6 | $ 13.3 | $ 26.2 | $ 24.6 | |||||||||
|
Revenue from Contracts with Customers, Performance Obligations (Details) $ in Millions |
Jun. 30, 2019
USD ($)
|
---|---|
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-06-30 | |
Revenue, Performance Obligation [Abstract] | |
Remaining performance obligation amount | $ 218.9 |
Remaining performance obligation, expected timing of satisfaction, period | 12 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-06-30 | |
Revenue, Performance Obligation [Abstract] | |
Remaining performance obligation amount | $ 50.5 |
Remaining performance obligation, expected timing of satisfaction, period |
Revenue from Contracts with Customers, Contract Balances (Details) - USD ($) $ in Millions |
Jun. 30, 2019 |
Dec. 31, 2018 |
---|---|---|
Contract with Customer, Asset and Liability [Abstract] | ||
Accounts receivable | $ 498.6 | $ 525.4 |
Contract assets | 26.0 | 19.6 |
Contract liabilities | $ 60.6 | $ 69.6 |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Income Taxes [Abstract] | ||||
Income before income taxes | $ 53.2 | $ 77.5 | $ 112.4 | $ 143.4 |
Provision for income taxes | $ 8.3 | $ 17.2 | $ 20.3 | $ 40.7 |
Effective income tax provision rate | 15.60% | 22.20% | 18.10% | 28.40% |
Leases (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2019 |
Dec. 31, 2018 |
|||
Components of lease expense [Abstract] | |||||
Operating lease cost | $ 5.6 | $ 11.0 | |||
Finance lease cost [Abstract] | |||||
Amortization of right-of-use assets | 0.3 | 0.7 | |||
Interest on lease liabilities | 0.4 | 0.8 | |||
Total finance lease cost | 0.7 | 1.5 | |||
Short-term lease cost | 0.3 | 0.5 | |||
Cash paid for amounts included in the measurement of leases [Abstract] | |||||
Operating cash flows from operating leases | 10.9 | ||||
Operating cash flows from finance leases | 0.8 | ||||
Financing cash flows from finance leases | 0.4 | ||||
Operating leases [Abstract] | |||||
Other assets | 57.3 | 57.3 | |||
Operating Lease Liability [Abstract] | |||||
Accrued liabilities | [1] | 17.5 | 17.5 | $ 0.0 | |
Other liabilities | 40.1 | 40.1 | |||
Total operating lease liabilities | 57.6 | 57.6 | |||
Finance Leases [Abstract] | |||||
Property, plant and equipment | 24.6 | 24.6 | |||
Finance Lease Liability [Abstract] | |||||
Short-term borrowings and current maturities of long-term debt | 1.0 | 1.0 | |||
Long-term debt, less current maturities | 24.9 | 24.9 | |||
Total finance lease liabilities | $ 25.9 | $ 25.9 | |||
Weighted Average Remaining Lease Term (in years) [Abstract] | |||||
Operating leases | 4 years 7 months 6 days | 4 years 7 months 6 days | |||
Finance leases | 14 years 1 month 6 days | 14 years 1 month 6 days | |||
Weighted Average Discount Rate [Abstract] | |||||
Operating leases | 2.40% | 2.40% | |||
Finance leases | 6.30% | 6.30% | |||
Operating Lease Liabilities [Abstract] | |||||
2019 (excluding the six months ended June 30, 2019) | $ 9.8 | $ 9.8 | |||
2020 | 16.6 | 16.6 | |||
2,021 | 11.7 | 11.7 | |||
2,022 | 8.0 | 8.0 | |||
2,023 | 5.3 | 5.3 | |||
Thereafter | 9.2 | 9.2 | |||
Total lease payments | 60.6 | 60.6 | |||
Less imputed interest | (3.0) | (3.0) | |||
Total operating lease liabilities | 57.6 | 57.6 | |||
Finance Lease Liabilities [Abstract] | |||||
2019 (excluding the six months ended June 30, 2019) | 1.3 | 1.3 | |||
2020 | 2.5 | 2.5 | |||
2021 | 2.6 | 2.6 | |||
2022 | 2.6 | 2.6 | |||
2023 | 2.7 | 2.7 | |||
Thereafter | 28.8 | 28.8 | |||
Total lease payments | 40.5 | 40.5 | |||
Less imputed interest | (14.6) | (14.6) | |||
Total finance lease liabilities | 25.9 | 25.9 | |||
Future minimum rental payments for operating leases [Abstract] | |||||
Future minimum rental payments for operating leases, 2019 | 25.8 | 25.8 | |||
Future minimum rental payments for operating leases, 2020 | 19.5 | 19.5 | |||
Future minimum rental payments for operating leases, 2021 | 13.9 | 13.9 | |||
Future minimum rental payments for operating leases, 2022 | 7.7 | 7.7 | |||
Future minimum rental payments for operating leases, 2023 | 5.4 | 5.4 | |||
Future minimum rental payments for operating leases, Thereafter | 9.4 | 9.4 | |||
Future minimum rental payments for capital leases [Abstract] | |||||
Future minimum rental payments for capital leases, 2019 | 0.8 | 0.8 | |||
Future minimum rental payments for capital leases, 2020 | 1.0 | 1.0 | |||
Future minimum rental payments for capital leases, 2021 | 1.1 | 1.1 | |||
Future minimum rental payments for capital leases, 2022 | 1.2 | 1.2 | |||
Future minimum rental payments for capital leases, 2023 | 1.4 | 1.4 | |||
Future minimum rental payments for capital leases, Thereafter | $ 20.7 | $ 20.7 | |||
|
Supplemental Information (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
||||||||||
Other Operating Expense, Net [Abstract] | |||||||||||||
Foreign currency transaction losses (gains), net | $ 0.6 | $ (2.4) | $ 3.7 | $ 0.2 | |||||||||
Restructuring charges, net | [1] | 0.8 | 0.0 | 2.8 | 0.0 | ||||||||
Stock-based compensation | [2] | 7.1 | (0.8) | 16.4 | 1.9 | ||||||||
Shareholder litigation settlement recoveries | [3] | 0.0 | 0.0 | (6.0) | (4.5) | ||||||||
Acquisition related expenses and non-cash charges | [4] | 17.1 | 2.9 | 18.7 | 5.9 | ||||||||
Gains on asset disposals | (0.4) | 0.0 | (0.3) | (1.2) | |||||||||
Other, net | 0.1 | 0.9 | 1.1 | 2.6 | |||||||||
Total other operating expense, net | 25.3 | 0.6 | 36.4 | 4.9 | |||||||||
Share-based Compensation [Abstract] | |||||||||||||
Stock-based compensation expense recognized | 6.0 | 1.8 | 13.6 | 5.2 | |||||||||
Increase in stock-based compensation expense due to costs associated with employer taxes | $ 1.1 | $ 2.8 | |||||||||||
Decrease in stock-based compensation expense due to reduction of an accrual related to employer taxes | $ 2.6 | $ 3.3 | |||||||||||
|
Contingencies (Details) $ in Millions |
6 Months Ended | |
---|---|---|
Jun. 30, 2019
USD ($)
Defendant
Site
|
Dec. 31, 2018
USD ($)
|
|
Environmental Matters [Abstract] | ||
Number of on-site cleanups | Site | 4 | |
Number of on-site cleanups in operation and maintenance stage | Site | 3 | |
Number of on-site cleanups in implementation stage | Site | 1 | |
Undiscounted accrued liabilities | $ | $ 6.8 | $ 6.9 |
Asbestos and Silica Related Litigation [Member] | ||
Asbestos and Silica Related Litigation [Abstract] | ||
Litigation reserve | $ | 102.3 | 105.8 |
Insurance recovery receivable amount | $ | $ 102.8 | $ 103.0 |
Asbestos and Silica Related Litigation [Member] | Minimum [Member] | ||
Asbestos and Silica Related Litigation [Abstract] | ||
Number of defendants | Defendant | 25 |
Segment Results (Details) $ in Millions |
3 Months Ended | 6 Months Ended | ||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2019
USD ($)
|
Jun. 30, 2018
USD ($)
|
Jun. 30, 2019
USD ($)
Segment
|
Jun. 30, 2018
USD ($)
|
|||||||||||||||||||||||||||
Segment Results [Abstract] | ||||||||||||||||||||||||||||||
Number of reportable segments | Segment | 3 | |||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||
Revenue | $ 629.1 | $ 668.2 | $ 1,249.4 | $ 1,287.7 | ||||||||||||||||||||||||||
Less items to reconcile Segment Adjusted EBITDA to Income Before Income Taxes [Abstract] | ||||||||||||||||||||||||||||||
Interest expense | 22.4 | 26.1 | 44.8 | 52.1 | ||||||||||||||||||||||||||
Restructuring and related business transformation costs | 2.0 | 8.4 | 6.1 | 12.9 | ||||||||||||||||||||||||||
Acquisition related expenses and non-cash charges | [1] | 17.1 | 2.9 | 18.7 | 5.9 | |||||||||||||||||||||||||
Stock-based compensation | 13.6 | 5.2 | ||||||||||||||||||||||||||||
Foreign currency transaction losses (gains), net | (0.6) | 2.4 | (3.7) | (0.2) | ||||||||||||||||||||||||||
Loss on extinguishment of debt | 0.2 | 0.2 | 0.2 | 0.2 | ||||||||||||||||||||||||||
Shareholder litigation settlement recoveries | [2] | 0.0 | 0.0 | (6.0) | (4.5) | |||||||||||||||||||||||||
Income Before Income Taxes | 53.2 | 77.5 | 112.4 | 143.4 | ||||||||||||||||||||||||||
Insurance recoveries of legal defense costs | 5.6 | |||||||||||||||||||||||||||||
Restructuring and Related Business Transformation Costs [Abstract] | ||||||||||||||||||||||||||||||
Restructuring charges | [3] | 0.8 | 0.0 | 2.8 | 0.0 | |||||||||||||||||||||||||
Severance, sign-on, relocation and executive search costs | 0.2 | 1.9 | 1.2 | 3.9 | ||||||||||||||||||||||||||
Facility reorganization, relocation and other costs | 0.5 | 0.7 | 1.1 | 1.3 | ||||||||||||||||||||||||||
Information technology infrastructure transformation | 0.4 | 0.2 | 0.7 | 0.2 | ||||||||||||||||||||||||||
Gains on asset disposals | (0.4) | 0.0 | (0.3) | (1.2) | ||||||||||||||||||||||||||
Consultant and other advisor fees | 0.1 | 4.0 | 0.2 | 6.6 | ||||||||||||||||||||||||||
Other, net | 0.4 | 1.6 | 0.4 | 2.1 | ||||||||||||||||||||||||||
Total restructuring and related business transformation costs | 2.0 | 8.4 | 6.1 | 12.9 | ||||||||||||||||||||||||||
Stock-based compensation expense recognized | 6.0 | 1.8 | 13.6 | 5.2 | ||||||||||||||||||||||||||
Increase in stock-based compensation expense due to costs associated with employer taxes | 1.1 | 2.8 | ||||||||||||||||||||||||||||
Decrease in stock-based compensation expense due to reduction of an accrual related to employer taxes | 2.6 | 3.3 | ||||||||||||||||||||||||||||
Industrials [Member] | ||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||
Revenue | 334.3 | 328.7 | 652.4 | 645.6 | ||||||||||||||||||||||||||
Energy [Member] | ||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||
Revenue | 222.8 | 273.1 | 455.9 | 515.3 | ||||||||||||||||||||||||||
Medical [Member] | ||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||
Revenue | 72.0 | 66.4 | 141.1 | 126.8 | ||||||||||||||||||||||||||
Operating Segments [Member] | ||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||
Adjusted EBITDA | 154.3 | 168.8 | 305.4 | 319.4 | ||||||||||||||||||||||||||
Operating Segments [Member] | Industrials [Member] | ||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||
Revenue | 334.3 | 328.7 | 652.4 | 645.6 | ||||||||||||||||||||||||||
Adjusted EBITDA | 76.6 | 71.1 | 147.7 | 137.9 | ||||||||||||||||||||||||||
Operating Segments [Member] | Energy [Member] | ||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||
Revenue | 222.8 | 273.1 | 455.9 | 515.3 | ||||||||||||||||||||||||||
Adjusted EBITDA | 56.3 | 79.7 | 116.3 | 147.6 | ||||||||||||||||||||||||||
Operating Segments [Member] | Medical [Member] | ||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||
Revenue | 72.0 | 66.4 | 141.1 | 126.8 | ||||||||||||||||||||||||||
Adjusted EBITDA | 21.4 | 18.0 | 41.4 | 33.9 | ||||||||||||||||||||||||||
Corporate [Member] | ||||||||||||||||||||||||||||||
Less items to reconcile Segment Adjusted EBITDA to Income Before Income Taxes [Abstract] | ||||||||||||||||||||||||||||||
Corporate expenses not allocated to segments | 6.7 | 7.2 | 17.7 | 9.6 | [4] | |||||||||||||||||||||||||
Segment Reconciling Items [Member] | ||||||||||||||||||||||||||||||
Less items to reconcile Segment Adjusted EBITDA to Income Before Income Taxes [Abstract] | ||||||||||||||||||||||||||||||
Interest expense | 22.4 | 26.1 | 44.8 | 52.1 | ||||||||||||||||||||||||||
Depreciation and amortization expenses | 44.4 | 45.3 | 89.9 | 90.2 | ||||||||||||||||||||||||||
Restructuring and related business transformation costs | [5] | 2.0 | 8.4 | 6.1 | 12.9 | |||||||||||||||||||||||||
Acquisition related expenses and non-cash charges | [6] | 17.1 | 5.7 | 18.7 | 10.3 | |||||||||||||||||||||||||
Expenses related to public stock offerings | [7] | 0.0 | 0.5 | 0.0 | 1.9 | |||||||||||||||||||||||||
Establish public company financial reporting compliance | [8] | 0.0 | 1.1 | 0.6 | 1.9 | |||||||||||||||||||||||||
Stock-based compensation | [9] | 7.1 | (0.8) | 16.4 | 1.9 | |||||||||||||||||||||||||
Foreign currency transaction losses (gains), net | 0.6 | (2.4) | 3.7 | 0.2 | ||||||||||||||||||||||||||
Loss on extinguishment of debt | [10] | 0.2 | 0.2 | 0.2 | 0.2 | |||||||||||||||||||||||||
Shareholder litigation settlement recoveries | [11] | 0.0 | 0.0 | (6.0) | (4.5) | |||||||||||||||||||||||||
Other adjustments | [12] | 0.6 | 0.0 | 0.9 | (0.7) | |||||||||||||||||||||||||
Restructuring and Related Business Transformation Costs [Abstract] | ||||||||||||||||||||||||||||||
Total restructuring and related business transformation costs | [5] | $ 2.0 | $ 8.4 | $ 6.1 | $ 12.9 | |||||||||||||||||||||||||
|
Related Party Transactions (Details) - 6 months ended Jun. 30, 2019 - KKR [Member] € in Millions, $ in Millions |
EUR (€) |
USD ($) |
---|---|---|
Related Party Transaction, Due to Related Party [Abstract] | ||
Related party transaction, structuring fees | $ | $ 0.4 | |
Lender in Senior Secured Credit Facilities [Member] | Euro Term Loan Facility [Member] | ||
Related Party Transaction, Due to Related Party [Abstract] | ||
Related party transaction amount | € | € 48.2 |
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2019 |
Jun. 30, 2018 |
Jun. 30, 2019 |
Jun. 30, 2018 |
|
Earnings Per Share [Abstract] | ||||
Net income | $ 44.9 | $ 60.3 | $ 92.1 | $ 102.7 |
Average shares outstanding [Abstract] | ||||
Basic (in shares) | 203.4 | 201.8 | 202.5 | 201.7 |
Diluted (in shares) | 208.9 | 209.6 | 208.4 | 209.8 |
Earnings per share [Abstract] | ||||
Basic (in dollars per share) | $ 0.22 | $ 0.30 | $ 0.45 | $ 0.51 |
Diluted (in dollars per share) | $ 0.21 | $ 0.29 | $ 0.44 | $ 0.49 |
Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of diluted loss per share (in shares) | 1.8 | 0.8 | 1.8 | 0.8 |
Subsequent Events (Details) $ in Millions |
Jul. 08, 2019
USD ($)
|
---|---|
Subsequent Event [Member] | Oina VV AB [Member] | |
Business Combinations [Abstract] | |
Cash consideration | $ 10.0 |
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