REVENUES

12 Months Ended

Dec. 31, 2020

REVENUES

REVENUES

18. REVENUES

Revenue Recognition

Product and Sold Equipment

Product revenue is generated from cleaning, sanitizing, water and colloidal silica products. In addition, the Company sells equipment which may be used in combination with its specialized products. Revenue recognized from product and sold equipment is recognized at the point in time when the obligations in the contract with the customer are satisfied, which generally occurs with the transfer of the product or delivery of the equipment.

Service and Lease Equipment

Service and lease equipment revenue is generated from providing services or leasing equipment to customers. Service offerings include installing or repairing certain types of equipment, activities that supplement or replace headcount at the customer location, or fulfilling deliverables included in the contract. Services provided in Other primary includes services designed to detect, eliminate and prevent pests. Services in the Global Industrial segment are associated with water treatment and paper process applications while Global Institutional & Specialty services include water treatment programs and process applications, and wash process solutions. Global Healthcare & Life Sciences services include pharmaceutical, personal care, infection and containment control solutions. Revenue recognized from leased equipment primarily relates to warewashing and water treatment equipment. Service revenue is recognized over time utilizing an input method and aligns with when the services are provided. Typically, revenue is recognized over time using costs incurred to date because the effort provided by the field selling and service organization represents services provided, which corresponds with the transfer of control. Revenue for leased equipment is accounted for under Topic 842 Leases and recognized on a straight-line basis over the length of the lease contract. Refer to Note 14 for additional information related to lease equipment.

Practical Expedients and Exemptions

The revenue standard can be applied to a portfolio of contracts with similar characteristics if it is reasonable that the effects of applying the standard at the portfolio would not be significantly different than applying the standard at the individual contract level. The Company applies the portfolio approach primarily within each operating segment by geographical region. Application of the portfolio approach was focused on those characteristics that have the most significant accounting consequences in terms of their effect on the timing of revenue recognition or the amount of revenue recognized. The Company determined the key criteria to assess with respect to the portfolio approach, including the related deliverables, the characteristics of the customers and the timing and transfer of goods and services, which most closely aligned within the operating segments. In addition, the accountability for the business operations, as well as the operational decisions on how to go to market and the product offerings, are performed at the operating segment level.

The following table shows principal activities, separated by reportable segments, from which the Company generates its revenue. The reportable segments have been revised to align with the Company’s reportable segments in the current year. Corporate segment includes sales to ChampionX under the Master Cross Supply and Product Transfer agreements entered into as part of the ChampionX Separation. For more information about the Company’s reportable segments, refer to Note 19.

Net sales at public exchange rates by reportable segment are as follows:

(millions)	2020		2019		2018
Global Industrial
Product and sold equipment		$5,052.3		$5,174.1		$4,992.8
Service and lease equipment		818.5		806.1		814.0
Global Institutional & Specialty
Product and sold equipment		2,968.7		3,701.9		3,673.5
Service and lease equipment		584.5		699.6		628.5
Global Healthcare & Life Sciences
Product and sold equipment		1,071.4		890.6		877.2
Service and lease equipment		110.5		82.2		62.3
Other
Product and sold equipment		274.5		362.4		360.1
Service and lease equipment		809.8		845.1		813.7
Corporate
Product and sold equipment		99.7		-		-
Service and lease equipment		0.3		-		-
Total
Total product and sold equipment		$9,466.6		$10,129.0		$9,903.6
Total service and lease equipment		2,323.6		2,433.0		2,318.5

Net sales at public exchange rates by geographic region are as follows:

	Global Industrial						Global Institutional & Specialty
(millions)	2020		2019		2018		2020		2019		2018
United States		$2,564.3		$2,668.1		$2,564.9		$2,400.4		$3,021.3		$2,899.0
Europe		1,262.6		1,204.2		1,147.9		510.3		622.3		654.0
Asia Pacific		747.2		774.3		752.4		203.9		235.7		235.0
Latin America		491.7		525.8		512.1		128.3		162.2		161.5
Greater China		333.0		325.4		340.9		114.9		119.4		112.8
Canada		157.9		163.4		167.8		155.6		188.4		187.1
India, Middle East and Africa ("IMEA")		314.1		319.0		320.8		39.8		52.2		52.6
Total		$5,870.8		$5,980.2		$5,806.8		$3,553.2		$4,401.5		$4,302.0
	Global Healthcare & Life Sciences						Other
(millions)	2020		2019		2018		2020		2019		2018
United States		$432.6		$410.3		$395.7		$645.7		$710.8		$676.4
Europe		643.6		513.8		506.4		228.8		268.4		272.1
Asia Pacific		69.8		22.5		12.3		64.8		74.5		77.5
Latin America		6.1		4.5		4.1		50.3		50.2		49.4
Greater China		3.6		2.0		1.4		63.4		66.5		59.4
Canada		6.4		5.2		5.7		16.9		19.1		21.0
IMEA		19.8		14.5		13.9		14.4		18.0		18.0
Total		$1,181.9		$972.8		$939.5		$1,084.3		$1,207.5		$1,173.8
	Corporate
(millions)	2020		2019		2018
United States		$75.2		$-		$-
Europe		4.8		-		-
Asia Pacific		2.8		-		-
Latin America		13.1		-		-
Greater China		0.9		-		-
Canada		0.7		-		-
IMEA		2.5		-		-
Total		$100.0		$-		$-

Net sales by geographic region were determined based on origin of sale. There were no sales from a single foreign country or individual customer that were material to the Company’s consolidated net sales. Sales of warewashing products were approximately 11%, 13%, and 13% of consolidated net sales in 2020, 2019 and 2018, respectively.

Contract Liability

Payments received from customers are based on invoices or billing schedules as established in contracts with customers. Accounts receivable are recorded when the right to consideration becomes unconditional. The contract liability relates to billings in advance of performance (primarily service obligations) under the contract. Contract liabilities are recognized as revenue when the performance obligation has been performed, which primarily occurs during the subsequent quarter.

	December 31		December 31
(millions)	2020		2019
Contract liability as of beginning of the year		$76.7		$67.7
Revenue recognized in the year from:
Amounts included in the contract liability at the beginning of the year		(76.7)		(67.7)
Increases due to billings excluding amounts recognized as revenue during the year ended		79.8		70.2
Business combinations		0.6		6.5
Contract liability as of end of period		$80.4		$76.7