Income Taxes (Tables)

12 Months Ended

Jul. 31, 2020

Income Tax Disclosure [Abstract]

Schedule of components of earnings before income taxes

The components of earnings before income taxes are as follows (in millions):

	Year Ended July 31,
	2020		2019		2018
Earnings before income taxes:
United States	$	112.8	$	127.4	$	103.2
Foreign	222.4		247.8		260.4
Total	$	335.2	$	375.2	$	363.6

Schedule of components of the provision for income taxes

The components of the provision for income taxes are as follows (in millions):

	Year Ended July 31,
	2020		2019		2018
Income tax provision (benefit):
Current
Federal	$	9.7	$	21.3	$	100.0
State	3.1		4.0		5.3
Foreign	62.7		72.5		71.0
	75.5		97.8		176.3
Deferred
Federal	4.1		7.4		6.5
State	0.2		1.4		0.2
Foreign	(1.6)		1.4		0.3
	2.7		10.2		7.0
Total	$	78.2	$	108.0	$	183.3

Schedule of reconciliation of the U.S. statutory income tax rate with the effective income tax rate

The following table reconciles the U.S. statutory income tax rate with the effective income tax rate:

	Year Ended July 31,
	2020		2019		2018
Statutory U.S. federal rate	21.0	%	21.0	%	26.9	%
State income taxes	0.9		1.3		0.9
Foreign operations	3.5		4.7		1.7
Global Intangible Low Tax Income	0.2		1.3		N/A
Foreign Derived Intangible Income	(1.4)		(1.4)		N/A
Export, manufacturing and research credits	(0.7)		(0.8)		(1.0)
Change in unrecognized tax benefits	0.6		(0.8)		(0.3)
Tax benefits on stock-based compensation	(1.2)		(1.6)		(1.2)
Impact of U.S. Tax Cuts and Jobs Act	—		5.0		23.2
Other	0.4		0.1		0.2
Effective income tax rate	23.3	%	28.8	%	50.4	%

Schedule of the tax effects of temporary differences that give rise to deferred tax assets and liabilities

The tax effects of temporary differences that give rise to deferred tax assets and liabilities are as follows (in millions):

	July 31,
	2020		2019
Deferred tax assets:
Accrued expenses	$	9.9	$	10.1
Compensation and retirement plans	31.8		27.9
NOL and tax credit carryforwards	8.1		4.4
Inventory reserves	3.4		3.0
Operating lease assets	18.8		—
Other	4.2		4.5
Gross deferred tax assets	76.2		49.9
Valuation allowance	(8.1)		(4.4)
Deferred tax assets, net of valuation allowance	68.1		45.5
Deferred tax liabilities:
Depreciation and amortization	(47.4)		(43.2)
Operating lease liabilities	(18.8)		—
Other	(1.8)		(1.4)
Deferred tax liabilities	(68.0)		(44.6)
Net deferred tax asset	$	0.1	$	0.9

Schedule of NOL and tax credit valuation allowances

The activity in the NOL and tax credit valuation allowances is as follows (in millions):

	Year Ended July 31,
	2020		2019		2018
Balance at beginning of year	$	(4.4)	$	(6.2)	$	(5.2)
Additions charged to costs and expenses	(3.7)		(0.2)		(1.0)
Deductions from reserves	—		2.0		—
Balance at end of year	$	(8.1)	$	(4.4)	$	(6.2)

As of July 31, 2020, the Company had tax effected operating losses and tax credit carryovers for federal, approximately $2.4 million, state, approximately $2.5 million, and international, approximately $3.2 million, with all amounts before limitation impacts and valuation allowances. Federal tax attribute carryovers will expire after 10 years, the state after one to 20 years, and the international after one year to an indefinite carryover period. As of July 31, 2020, the Company had provided $8.1 million of valuation allowance against certain of these deferred tax assets based on management’s determination that it is more-likely-than-not that the tax benefits related to these assets will not be realized.

Summary of reconciliation of the beginning and ending amount of gross unrecognized tax benefits

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (in millions):

	Year Ended July 31,
	2020		2019		2018
Gross unrecognized tax benefits at beginning of fiscal year	$	15.5	$	18.5	$	18.8
Additions for tax positions of the current fiscal year	2.8		2.5		4.4
Additions for tax positions of prior fiscal years	0.2		0.7		0.2
Reductions for tax positions of prior fiscal years	(0.1)		(4.9)		(3.1)
Settlements	—		—		(0.4)
Reductions due to lapse of applicable statute of limitations	(1.5)		(1.3)		(1.4)
Gross unrecognized tax benefits at end of fiscal year	$	16.9	$	15.5	$	18.5