10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 FORM 10-Q

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

for the quarterly period ended July 3, 2021 or 

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

Commission file number 001-07283

REGAL BELOIT CORPORATION

(Exact name of registrant as specified in its charter)

Wisconsin	39-0875718
(State of other jurisdiction of incorporation)	(IRS Employer Identification No.)

200 State Street, Beloit, Wisconsin 53511

(Address of principal executive office)

(608) 364-8800

Registrant’s telephone number, including area code

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock	RBC	New York Stock Exchange

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

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒  No ☐

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

Large Accelerated Filer	☒	Accelerated Filer	☐
Non-accelerated filer	☐	Smaller Reporting Company	☐
		Emerging growth company	☐

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

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

On August 2, 2021 the registrant had outstanding 40,697,042 shares of common stock, $0.01 par value per share.

REGAL BELOIT CORPORATION

INDEX

		Page
PART I — FINANCIAL INFORMATION
Item 1 —	Condensed Consolidated Financial Statements (Unaudited)
	Condensed Consolidated Statements of Income	5
	Condensed Consolidated Statements of Comprehensive Income	6
	Condensed Consolidated Balance Sheets	7
	Condensed Consolidated Statements of Equity	8
	Condensed Consolidated Statements of Cash Flows	10
	Notes to Condensed Consolidated Financial Statements	11
Item 2 —	Management’s Discussion and Analysis of Financial Condition and Results of Operations	37
Item 3 —	Quantitative and Qualitative Disclosures about Market Risk	47
Item 4 —	Controls and Procedures	49
PART II — OTHER INFORMATION
Item 1 —	Legal Proceedings	49
Item 1A —	Risk Factors	49
Item 2 —	Unregistered Sales of Equity Securities and Use of Proceeds	50
Item 6 —	Exhibits	51
Signature		52

2

CAUTIONARY STATEMENT

Certain statements made in this Quarterly Report on Form 10-Q are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. This report contains forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, which reflect the Company’s current estimates, expectations and projections about the Company’s future results, performance, prospects and opportunities. Such forward-looking statements may include, among other things, statements about the Company’s future operations, anticipated business levels, future earnings, planned activities, anticipated growth, market opportunities, strategies, competition and other expectations and estimates for future periods. Forward-looking statements may also include statements relating to the proposed acquisition of Rexnord Corporation's (“Rexnord”) Process & Motion Control business (the “PMC Business”) (the “Rexnord Transaction”), the benefits and synergies of the Rexnord Transaction, future opportunities for the Company, the PMC Business and the combined company, and any other statements regarding the Rexnord Transaction or the combined company. Forward-looking statements include statements that are not historical facts and can be identified by forward-looking words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “plan,” “may,” “should,” “will,” “would,” “project,” “forecast,” and similar expressions. These forward-looking statements are based upon information currently available to the Company and are subject to a number of risks, uncertainties, and other factors that could cause performance, prospects, or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. Important factors that could cause actual results to differ materially from the results referred to in the forward-looking statements the Company makes in this report include:

Operations and Strategy

•the continued financial and operational impacts of and uncertainties relating to the COVID-19 pandemic on customers and suppliers and the geographies in which they operate;

•uncertainties regarding the ability to execute restructuring plans within expected costs and timing;

•our ability to develop new products based on technological innovation, such as the Internet of Things ("IoT"), and marketplace acceptance of new and existing products, including products related to technology not yet adopted or utilized in certain geographic locations in which we do business;

•fluctuations in commodity prices and raw material costs;

•our dependence on significant customers;

•effects on earnings of any significant impairment of goodwill or intangible assets;

•prolonged declines or disruption in one or more markets we serve, such as heating, ventilation, air conditioning ("HVAC"), refrigeration, power generation, oil and gas, unit material handling or water heating;

•product liability and other litigation, or claims by end users, government agencies or others that our products or our customers’ applications failed to perform as anticipated, particularly in high volume applications or where such failures are alleged to be the cause of property or casualty claims;

•our overall debt levels and our ability to repay principal and interest on our outstanding debt, including debt assumed or incurred in connection with the Rexnord Transaction;

•our dependence on key suppliers and the potential effects of supply disruptions;

•seasonal impact on sales of our products into HVAC systems and other residential applications;

Global Footprint

•actions taken by our competitors and our ability to effectively compete in the increasingly competitive global electric motor and controls, power generation and power transmission industries;

•risks associated with global manufacturing, including risks associated with public health crises;

•economic changes in global markets where we do business, such as reduced demand for the products we sell, currency exchange rates, inflation rates, interest rates, recession, government policies, including policy changes affecting taxation, trade, tariffs, immigration, customs, border actions and the like, and other external factors that we cannot control;

3

Legal and Regulatory Environment

•unanticipated costs or expenses we may incur related to litigation, including product warranty issues;

•infringement of our intellectual property by third parties, challenges to our intellectual property and claims of infringement by us of third party technologies;

•losses from failures, breaches, attacks or disclosures involving our information technology infrastructure and data;

Mergers, Acquisitions and Divestitures

•the possibility that the conditions to the consummation of the Rexnord Transaction will not be satisfied, including shareholder approvals, that there will be delays in satisfying or adverse conditions related to the satisfaction of such conditions, or that the Rexnord Transaction will fail to be consummated or be delayed in being consummated for other reasons; the possibility that the IRS ruling sought in connection with the Rexnord Transaction will not be received on the terms requested, or at all, or that there will be delays in obtaining or adverse conditions related to the receipt of the IRS ruling;

•changes in the extent and characteristics of the common shareholders of Rexnord and the Company and its effect pursuant to the merger agreement for the Rexnord Transaction on the number of shares of Company common stock issuable pursuant to the transaction, magnitude of the dividend payable to Company shareholders pursuant to the transaction and the extent of indebtedness to be incurred by the Company in connection with the transaction;

•the ability to obtain the anticipated tax treatment of the Rexnord Transaction and related transactions;

•failure to successfully integrate the PMC Business and any other future acquisitions into our business or achieve expected financial results, operating results, synergies and operating efficiencies, due to factors including the future financial and operating performance of the acquired business, loss of key executives and employees, or operating costs, customer loss and business disruption being greater than expected;

•costs and indemnification obligations related to transactions, including the Rexnord Transaction;

•risks associated with any litigation related to the Rexnord Transaction or other transactions;

•unanticipated liabilities of acquired businesses, including the PMC Business;

•operating restrictions related to the Rexnord Transaction;

•unanticipated adverse effects or liabilities from business exits or divestitures;

General

•changes in the method of determining London Interbank Offered Rate ("LIBOR"), or the replacement of LIBOR with an alternative reference rate;

•cyclical downturns affecting the global market for capital goods;

•and other risks and uncertainties including, but not limited, to those described in "Part I - Item 1A - Risk Factors" in our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission ("SEC") on March 2, 2021 and from time to time in other filed reports.

Shareholders, potential investors, and other readers are urged to consider these factors in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included in this report are made only as of the date of this report, and the Company undertakes no obligation to update any forward-looking information contained in this report or with respect to the announcements described herein to reflect subsequent events or circumstances. Additional information regarding these and other risks and uncertainties is included in "Part I - Item 1A - Risk Factors" in our Annual Report on Form 10-K filed with the SEC on March 2, 2021 and from time to time in other filed reports.

4

PART I—FINANCIAL INFORMATION

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(Amounts in Millions, Except Per Share Data)

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Net Sales	$	886.9	$	634.1	$	1,701.0	$	1,368.3
Cost of Sales	635.4		463.8		1,204.1		994.7
Gross Profit	251.5		170.3		496.9		373.6
Operating Expenses	140.2		121.6		288.5		253.5
Gain on Divestiture of Businesses	—		—		—		(0.1)
Asset Impairments	2.3		2.8		2.3		4.3
Total Operating Expenses	142.5		124.4		290.8		257.7
Income from Operations	109.0		45.9		206.1		115.9
Other Income, Net	(1.2)		(1.1)		(2.4)		(2.2)
Interest Expense	11.5		10.6		24.1		22.2
Interest Income	(1.7)		(1.4)		(3.2)		(2.5)
Income before Taxes	100.4		37.8		187.6		98.4
Provision for Income Taxes	19.2		8.5		39.4		22.4
Net Income	81.2		29.3		148.2		76.0
Less: Net Income Attributable to Noncontrolling Interests	1.6		1.2		3.0		2.1
Net Income Attributable to Regal Beloit Corporation	$	79.6	$	28.1	$	145.2	$	73.9
Earnings Per Share Attributable to Regal Beloit Corporation:
Basic	$	1.96	$	0.69	$	3.57	$	1.82
Assuming Dilution	$	1.94	$	0.69	$	3.54	$	1.81
Weighted Average Number of Shares Outstanding:
Basic	40.7		40.5		40.6		40.6
Assuming Dilution	41.0		40.7		41.0		40.7

See Accompanying Notes to Condensed Consolidated Financial Statements

5

REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(Dollars in Millions)

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Net Income	$	81.2	$	29.3	$	148.2	$	76.0
Other Comprehensive Income (Loss) Net of Tax:
Foreign Currency Translation Adjustments	10.0		18.0		(11.7)		(39.5)
Hedging Activities:
Increase (Decrease) in Fair Value of Hedging Activities, Net of Tax Effects of $4.2 Million and $3.6 Million for the Three Months Ended July 3, 2021 and June 27, 2020 and $8.8 Million and $(5.8) Million for the Six Months Ended July 3, 2021 and June 27, 2020, Respectively	13.3		11.3		27.9		(18.3)
Reclassification of (Gains) Losses included in Net Income, Net of Tax Effects of $(2.7) Million and $0.5 Million for the Three Months Ended July 3, 2021 and June 27, 2020 and $(5.5) Million and $(0.1) Million for the Six Months Ended July 3, 2021 and June 27, 2020, Respectively	(8.6)		1.6		(17.3)		(0.4)
Pension and Post Retirement Plans:
Reclassification Adjustments for Pension and Post Retirement Benefits included in Net Income, Net of Tax Effects of $0.1 Million for the Three Months Ended July 3, 2021 and June 27, 2020 and $0.2 Million and $0.1 Million for the Six Months Ended July 3, 2021 and June 27, 2020, Respectively	0.4		0.1		0.7		0.2
Other Comprehensive Income (Loss)	15.1		31.0		(0.4)		(58.0)
Comprehensive Income	96.3		60.3		147.8		18.0
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interests	2.3		1.1		3.4		1.3
Comprehensive Income Attributable to Regal Beloit Corporation	$	94.0	$	59.2	$	144.4	$	16.7

        See Accompanying Notes to Condensed Consolidated Financial Statements

6

REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Dollars in Millions, Except Per Share Data)

	July 3, 2021		January 2, 2021
ASSETS
Current Assets:
Cash and Cash Equivalents	$	618.5	$	611.3
Trade Receivables, Less Allowances of $18.4 Million and $18.3 Million in 2021 and 2020, Respectively	558.0		432.0
Inventories	759.2		690.3
Prepaid Expenses and Other Current Assets	141.0		108.6
Assets Held for Sale	7.5		9.1
Total Current Assets	2,084.2		1,851.3
Net Property, Plant and Equipment	534.1		555.5
Operating Lease Assets	71.8		73.4
Goodwill	1,511.8		1,518.2
Intangible Assets, Net of Amortization	504.9		530.3
Deferred Income Tax Benefits	45.3		43.9
Other Noncurrent Assets	21.6		16.4
Total Assets	$	4,773.7	$	4,589.0
LIABILITIES AND EQUITY
Current Liabilities:
Accounts Payable	$	461.4	$	360.1
Dividends Payable	13.4		12.2
Accrued Compensation and Employee Benefits	77.4		76.6
Other Accrued Expenses	133.7		120.5
Current Operating Lease Liabilities	22.0		21.6
Current Maturities of Long-Term Debt	230.9		231.0
Total Current Liabilities	938.8		822.0
Long-Term Debt	789.0		840.4
Deferred Income Taxes	175.3		172.0
Pension and Other Post Retirement Benefits	63.7		69.5
Noncurrent Operating Lease Liabilities	53.2		55.1
Other Noncurrent Liabilities	57.2		53.0
Contingencies (see Note 13)
Equity:
Regal Beloit Corporation Shareholders' Equity:
Common Stock, $0.01 par value, 100.0 Million Shares Authorized, 40.7 Million and 40.6 Million Shares Issued and Outstanding for 2021 and 2020, Respectively	0.4		0.4
Additional Paid-In Capital	698.4		696.6
Retained Earnings	2,130.3		2,010.7
Accumulated Other Comprehensive Loss	(164.1)		(163.3)
Total Regal Beloit Corporation Shareholders' Equity	2,665.0		2,544.4
Noncontrolling Interests	31.5		32.6
Total Equity	2,696.5		2,577.0
Total Liabilities and Equity	$	4,773.7	$	4,589.0

See Accompanying Notes to Condensed Consolidated Financial Statements.

7

REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

(Dollars in Millions, Except Per Share Data)

	Three Months Ended
	Common Stock $0.01 Par Value		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests		Total Equity
April 3, 2021	$	0.4	$	698.1	$	2,064.1	$	(178.5)	$	33.7	$	2,617.8
Net Income	—		—		79.6		—		1.6		81.2
Other Comprehensive Income	—		—		—		14.4		0.7		15.1
Dividends Declared ($0.33 Per Share)	—		—		(13.4)		—		—		(13.4)
Stock Options Exercised	—		(4.2)		—		—		—		(4.2)
Share-Based Compensation	—		4.5		—		—		—		4.5
Dividends Declared to Noncontrolling Interests	—		—		—		—		(4.5)		(4.5)
July 3, 2021	$	0.4	$	698.4	$	2,130.3	$	(164.1)	$	31.5	$	2,696.5
March 28, 2020	$	0.4	$	692.5	$	1,903.8	$	(326.1)	$	29.5	$	2,300.1
Net Income	—		—		28.1		—		1.2		29.3
Other Comprehensive Income (Loss)	—		—		—		31.1		(0.1)		31.0
Dividends Declared ($0.30 Per Share)	—		—		(12.2)		—		—		(12.2)
Stock Options Exercised	—		(1.3)		—		—		—		(1.3)
Share-Based Compensation	—		2.8		—		—		—		2.8
Dividends Declared to Noncontrolling Interests	—		—		—		—		(2.7)		(2.7)
June 27, 2020	$	0.4	$	694.0	$	1,919.7	$	(295.0)	$	27.9	$	2,347.0

8

	Six Months Ended
	Common Stock $0.01 Par Value		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interests		Total Equity
January 2, 2021	$	0.4	$	696.6	$	2,010.7	$	(163.3)	$	32.6	$	2,577.0
Net Income	—		—		145.2		—		3.0		148.2
Other Comprehensive Income (Loss)	—		—		—		(0.8)		0.4		(0.4)
Dividends Declared ($0.63 Per Share)	—		—		(25.6)		—		—		(25.6)
Stock Options Exercised	—		(6.0)		—		—		—		(6.0)
Share-Based Compensation	—		7.8		—		—		—		7.8
Dividends Declared to Noncontrolling Interests	—		—		—		—		(4.5)		(4.5)
July 3, 2021	$	0.4	$	698.4	$	2,130.3	$	(164.1)	$	31.5	$	2,696.5
December 28, 2019	$	0.4	$	701.8	$	1,886.7	$	(237.8)	$	29.3	$	2,380.4
Net Income	—		—		73.9		—		2.1		76.0
Other Comprehensive Loss	—		—		—		(57.2)		(0.8)		(58.0)
Dividends Declared ($0.60 Per Share)	—		—		(24.3)		—		—		(24.3)
Stock Options Exercised	—		(2.2)		—		—		—		(2.2)
Stock Repurchase	—		(11.1)		(13.9)		—		—		(25.0)
Share-Based Compensation	—		5.5		—		—		—		5.5
Adoption of ASU 2016-13	—		—		(2.7)		—		—		(2.7)
Dividends Declared to Noncontrolling Interests	—		—		—		—		(2.7)		(2.7)
June 27, 2020	$	0.4	$	694.0	$	1,919.7	$	(295.0)	$	27.9	$	2,347.0

See Accompanying Notes to Condensed Consolidated Financial Statements.

9

REGAL BELOIT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(Dollars in Millions)

	Six Months Ended
	July 3, 2021		June 27, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	148.2	$	76.0
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities (Net of Acquisitions and Divestitures):
Depreciation and Amortization	62.3		65.9
Asset Impairments	2.3		4.3
Noncash Lease Expense	12.4		14.8
Loss on Sale or Disposition of Assets, Net	0.5		1.4
Share-Based Compensation Expense	7.8		5.5
Financing Fees Amortization	8.6		0.7
Gain on Divestiture of Businesses	—		(0.1)
Change in Operating Assets and Liabilities	(105.5)		21.1
Net Cash Provided by Operating Activities	136.6		189.6
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to Property, Plant and Equipment	(24.3)		(20.4)
Proceeds Received from Sales of Property, Plant and Equipment	1.8		5.3
Business Acquisitions, Net of Cash Acquired	(3.8)		—
Proceeds from Divestiture of Businesses	—		0.3
Net Cash Used in Investing Activities	(26.3)		(14.8)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings Under Revolving Credit Facility	183.7		669.7
Repayments Under Revolving Credit Facility	(183.7)		(682.1)
Proceeds from Short-Term Borrowings	6.2		2.3
Repayments of Short-Term Borrowings	(6.2)		(2.3)
Proceeds from Long-Term Borrowings	—		0.1
Repayments of Long-Term Borrowings	(50.2)		(0.2)
Dividends Paid to Shareholders	(24.4)		(24.3)
Shares Surrendered for Taxes	(6.1)		(2.5)
Proceeds from the Exercise of Stock Options	0.1		0.2
Repurchase of Common Stock	—		(25.0)
Distributions to Noncontrolling Interests	(4.5)		(2.7)
Financing Fees Paid	(17.0)		—
Net Cash Used in Financing Activities	(102.1)		(66.8)
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS	(1.0)		(7.2)
Net Increase in Cash and Cash Equivalents	7.2		100.8
Cash and Cash Equivalents at Beginning of Period	611.3		331.4
Cash and Cash Equivalents at End of Period	$	618.5	$	432.2
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash Paid For:
Interest	$	15.3	$	21.8
Income taxes	$	46.3	$	15.2

See Accompanying Notes to Condensed Consolidated Financial Statements.

10

REGAL BELOIT CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

July 3, 2021

(Unaudited)

1. BASIS OF PRESENTATION

The accompanying (a) Condensed Consolidated Balance Sheet of Regal Beloit Corporation (the “Company”) as of January 2, 2021, which has been derived from audited Consolidated Financial Statements, and (b) unaudited interim Condensed Consolidated Financial Statements as of July 3, 2021 and for the three and six months ended July 3, 2021 and June 27, 2020, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

It is suggested that these Condensed Consolidated Financial Statements be read in conjunction with the Consolidated Financial Statements and the Notes thereto included in the Company’s 2020 Annual Report on Form 10-K filed on March 2, 2021.

In the opinion of management, all adjustments considered necessary for a fair presentation of financial results have been made. Except as otherwise discussed, such adjustments consist of only those of a normal recurring nature. Operating results for the three and six months ended July 3, 2021 are not necessarily indicative of the results that may be expected for the entire fiscal year ending January 1, 2022.

The Condensed Consolidated Financial Statements have been prepared in accordance with GAAP, which requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the Condensed Consolidated Financial Statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. The Company uses estimates in accounting for, among other items, allowance for doubtful accounts; excess and obsolete inventory; share-based compensation; acquisitions; product warranty obligations; pension and post retirement assets and liabilities; derivative fair values; goodwill and other asset impairments; health care reserves; retirement benefits; rebates and incentives; litigation claims and contingencies, including environmental matters; and income taxes. The Company accounts for changes to estimates and assumptions when warranted by factually based experience.

The Company operates on a 52/53 week fiscal year ending on the Saturday closest to December 31.

Adopted Accounting Standards

In December 2019, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes. The ASU simplifies the accounting for income taxes by removing certain exceptions to the general principles of Topic 740, and clarifies and amends existing guidance to improve consistent application. This ASU becomes effective for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company adopted the standard as of January 3, 2021, the beginning of fiscal 2021, with no material impact on the Company's Condensed Consolidated Financial Statements.

2. OTHER FINANCIAL INFORMATION

Inventories

The following table presents approximate percentage distribution between major classes of inventories:

	July 3, 2021	January 2, 2021
Raw Material and Work in Process	49.5%	48.7%
Finished Goods and Purchased Parts	50.5%	51.3%

Inventories are stated at cost, which is not in excess of market. Cost for approximately 48.1% of the Company's inventory at July 3, 2021, and 50.0% at January 2, 2021 was determined using the last-in, first-out ("LIFO") method.

11

Property, Plant, and Equipment

The following table presents property, plant, and equipment by major classification (dollars in millions):

	Useful Life in Years	July 3, 2021		January 2, 2021
Land and Improvements		$	74.9	$	76.1
Buildings and Improvements	3 - 50	288.4		290.7
Machinery and Equipment	3 - 15	979.3		978.2
Property, Plant and Equipment		1,342.6		1,345.0
Less: Accumulated Depreciation		(808.5)		(789.5)
Net Property, Plant and Equipment		$	534.1	$	555.5

For the three and six months ended July 3, 2021, the Company recognized $2.3 million of asset impairment related to the transfer of assets to held for sale. For the three and six months ended June 27, 2020, the Company recognized $2.8 million and $4.3 million, respectively, of asset impairments related to the transfer of assets to held for sale.

Revenue Recognition

The Company recognizes revenue from the sale of electric motors, electrical motion controls, power generation and power transmission products. The Company recognizes revenue when control of the product passes to the customer or the service is provided and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services.

Nature of Goods and Services

The Company sells products with multiple applications as well as customized products that have a single application such as those manufactured for its OEM customers. The Company reports in four operating segments: Commercial Systems, Industrial Systems, Climate Solutions and Power Transmission Solutions. See Note 6 for a description of the different segments.

Nature of Performance Obligations

The Company’s contracts with customers typically consist of purchase orders, invoices and master supply agreements. At contract inception, across all four segments, the Company assesses the goods and services promised in its sales arrangements with customers and identifies a performance obligation for each promise to transfer to the customer a good or service that is distinct. The Company’s primary performance obligations consist of product sales and customized system/solutions.

Product:

The nature of products varies from segment to segment but across all segments, individual products are not integrated and represent separate performance obligations.

Customized system/solutions:

The Company provides customized system/solutions which consist of multiple products engineered and designed to specific customer specification, combined or integrated into one combined solution for a specific customer application. The goods are transferred to the customer and revenue is typically recognized over time as the performance obligations are satisfied.

When Performance Obligations are Satisfied

For performance obligations related to substantially all of the Company's product sales, the Company determines that the customer obtains control upon shipment and recognizes revenue accordingly. Once a product has shipped, the customer is able to direct the use of, and obtain substantially all of the remaining benefits from the asset. The Company considers control to have transferred upon shipment because the Company has a present right to payment at that time, the customer has legal title to the asset, the Company has transferred physical possession of the asset, and the customer has significant risks and rewards of ownership of the asset.

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For a limited number of contracts, the Company transfers control and recognizes revenue over time. The Company satisfies its performance obligations over time and the Company uses a cost-based input method to measure progress. In applying the cost-based method of revenue recognition, the Company uses actual costs incurred to date relative to the total estimated costs for the contract in conjunction with the customer's commitment to perform in determining the amount of revenue and cost to recognize. The Company has determined that the cost-based input method provides a faithful depiction of the transfer of goods to the customer.

Payment Terms

The arrangement with the customer states the final terms of the sale, including the description, quantity, and price of each product or service purchased. Payment terms vary by customer but typically range from due upon delivery to 120 days after delivery. For contracts recognized at a point in time, revenue and billing typically occur simultaneously. The Company generally has payment terms with its customers of one year or less and has elected the practical expedient applicable to such contracts not to consider the time value of money. For contracts recognized using the cost-based input method, revenue recognized in excess of customer billings and billings in excess of revenue recognized are reviewed to determine the net asset or net liability position and classified as such on the Condensed Consolidated Balance Sheet.

Returns, Refunds, and Warranties

The Company’s contracts do not explicitly offer a “general” right of return to its customers (e.g., customers ordered excess products and return unused items). Warranties are classified as either assurance type or service type warranties. A warranty is considered an assurance type warranty if it provides the customer with assurance that the product will function as intended. A warranty that goes above and beyond ensuring basic functionality is considered a service type warranty. The Company generally only offers limited warranties which are considered to be assurance type warranties and are not accounted for as separate performance obligations. Customers generally receive repair or replacement on products that do not function to specification. Estimated product warranties are provided for specific product groups and the Company accrues for estimated future warranty cost in the period in which the sale is recognized. The Company estimates the accrual requirements based on historical warranty loss experience and the cost is included in Cost of Sales.

Volume Rebates

In some cases, the nature of the Company’s contract may give rise to variable consideration including volume based sales incentives. If the customer achieves specific sales targets, they are entitled to rebates. The Company estimates the projected amount of the rebates that will be achieved and recognizes the estimated costs as a reduction to Net Sales as revenue is recognized.

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Disaggregation of Revenue

The following tables presents the Company’s revenues disaggregated by geographical region (in millions):

	Three Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	176.1	$	73.9	$	226.7	$	173.2	$	649.9
Asia	53.5		46.9		7.7		7.4		115.5
Europe	26.7		12.1		10.4		25.1		74.3
Rest-of-World	13.0		12.3		12.5		9.4		47.2
Total	$	269.3	$	145.2	$	257.3	$	215.1	$	886.9
June 27, 2020	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	112.5	$	69.2	$	158.8	$	123.2	$	463.7
Asia	28.9		36.6		1.0		7.5		74.0
Europe	25.5		14.7		7.5		22.2		69.9
Rest-of-World	9.0		0.1		10.9		6.5		26.5
Total	$	175.9	$	120.6	$	178.2	$	159.4	$	634.1

	Six Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	330.2	$	145.0	$	436.4	$	337.0	$	1,248.6
Asia	99.5		90.1		17.0		14.3		220.9
Europe	51.4		23.7		19.9		48.6		143.6
Rest-of-World	25.2		22.8		23.1		16.8		87.9
Total	$	506.3	$	281.6	$	496.4	$	416.7	$	1,701.0
June 27, 2020	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	255.9	$	142.1	$	343.4	$	284.1	$	1,025.5
Asia	52.3		73.4		9.6		12.4		147.7
Europe	54.0		27.9		15.1		46.1		143.1
Rest-of-World	13.1		6.8		20.2		11.9		52.0
Total	$	375.3	$	250.2	$	388.3	$	354.5	$	1,368.3

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3. HELD FOR SALE, DIVESTITURES AND ACQUISITIONS

Assets Held for Sale

The balances that were classified as Assets Held for Sale as of July 3, 2021 and January 2, 2021 were $7.5 million and $9.1 million, respectively.

Acquisition Pending

On February 15, 2021, the Company entered into definitive agreements with Rexnord Corporation (“Rexnord”), Land Newco, Inc., a wholly owned indirect subsidiary of Rexnord (“Land”), and Phoenix 2021, Inc., a wholly owned subsidiary of the Company (“Merger Sub”), with respect to a Reverse Morris Trust transaction (the “Rexnord Transaction”) pursuant to which, and subject to the terms and conditions of those definitive agreements discussed below, (1) Rexnord will transfer (or cause to be transferred) to Land substantially all of the assets, and Land will assume substantially all of the liabilities, of Rexnord’s Process & Motion Control business (“PMC Business”) (the “Reorganization”), (2) after which, all of the issued and outstanding shares of common stock, $0.01 par value per share, of Land (“Land common stock”) held by a subsidiary of Rexnord will be distributed in a series of distributions to Rexnord’s stockholders (the distributions, and the final distribution of Land common stock from Rexnord to Rexnord’s stockholders, which is to be made pro rata for no consideration, the “Spin-Off”) and (3) immediately after the Spin-Off, Merger Sub will merge with and into Land (the “Merger”) and all shares of Land common stock (other than those held by Rexnord, Land, the Company, Merger Sub or their respective subsidiaries) will be converted into the right to receive shares of our common stock, $0.01 par value per share (“Company common stock”), as calculated and subject to adjustment as set forth in the Merger Agreement (as defined below). When the Merger is completed, Land (which at that time will hold the PMC Business) will be a wholly owned subsidiary of the Company.

The definitive agreements the Company entered into in connection with the Rexnord Transaction include an Agreement and Plan of Merger, by and among Rexnord, Land, Merger Sub and the Company (the “Merger Agreement”), a Separation and Distribution Agreement, by and among Rexnord, Land and the Company and certain ancillary agreements.

In connection with the Rexnord Transaction, the Merger Agreement provides that the Company shall, to the extent required by the Merger Agreement, in certain circumstances in which additional shares of Company common stock are issued at closing to holders of Land common stock, declare a special dividend to the Company's stockholders immediately prior to the consummation of the Merger (the “Company Special Dividend”). The existence and magnitude of the dividend will depend on whether and to what extent the Company is able to count certain overlapping shareholders of the Company and Rexnord in satisfying the tax requirements applicable to a Reverse Morris Trust transaction. In the event that the Company Special Dividend is required to be paid, it could range in amount between zero and approximately $2.0 billion.

In connection with the Rexnord Transaction, the Company has entered into certain financing arrangements, which are described in Note 7.

Closing of the Rexnord Transaction is subject to various closing conditions, including the receipt of the approval of the Company's and Rexnord's shareholders and other customary closing conditions.

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4. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Foreign currency translation adjustments, hedging activities and pension and post retirement benefit adjustments are included in Accumulated Other Comprehensive Income (Loss) ("AOCI") a component of Total Equity.

The following tables present changes in AOCI by component for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended
July 3, 2021	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	29.4	$	(30.8)	$	(177.1)	$	(178.5)
Other Comprehensive Income before Reclassifications	17.5		—		9.3		26.8
Tax Impact	(4.2)		—		—		(4.2)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(11.3)		0.5		—		(10.8)
Tax Impact	2.7		(0.1)		—		2.6
Net Current Period Other Comprehensive Income	4.7		0.4		9.3		14.4
Ending Balance	$	34.1	$	(30.4)	$	(167.8)	$	(164.1)
June 27, 2020	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	(23.6)	$	(30.5)	$	(272.0)	$	(326.1)
Other Comprehensive Income (Loss) before Reclassifications	14.9		(0.1)		18.2		33.0
Tax Impact	(3.6)		—		—		(3.6)
Amounts Reclassified from Accumulated Other Comprehensive Income	2.1		0.2		—		2.3
Tax Impact	(0.5)		(0.1)		—		(0.6)
Net Current Period Other Comprehensive Income	12.9		—		18.2		31.1
Ending Balance	$	(10.7)	$	(30.5)	$	(253.8)	$	(295.0)

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	Six Months Ended
	July 3, 2021
	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	23.5	$	(31.1)	$	(155.7)	$	(163.3)
Other Comprehensive Income (Loss) before Reclassifications	36.7		—		(12.1)		24.6
Tax Impact	(8.8)		—		—		(8.8)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(22.8)		0.9		—		(21.9)
Tax Impact	5.5		(0.2)		—		5.3
Net Current Period Other Comprehensive Income (Loss)	10.6		0.7		(12.1)		(0.8)
Ending Balance	$	34.1	$	(30.4)	$	(167.8)	$	(164.1)
	Six Months Ended
	June 27, 2020
	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning balance	$	8.0	$	(31.0)	$	(214.8)	$	(237.8)
Other Comprehensive Income (Loss) before Reclassifications	(24.1)		0.3		(39.0)		(62.8)
Tax Impact	5.8		—		—		5.8
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(0.5)		0.3		—		(0.2)
Tax Impact	0.1		(0.1)		—		—
Net Current Period Other Comprehensive Income (Loss)	(18.7)		0.5		(39.0)		(57.2)
Ending Balance	$	(10.7)	$	(30.5)	$	(253.8)	$	(295.0)

The Condensed Consolidated Statements of Income line items affected by the hedging activities reclassified from AOCI in the tables above are disclosed in Note 14.

The reclassification amounts for pension and post retirement benefit adjustments in the tables above are part of net periodic benefit costs recorded in Other Income, Net (see also Note 8).

5. GOODWILL AND INTANGIBLE ASSETS

Goodwill

As required, the Company performs an annual impairment test of goodwill as of the end of the October fiscal month or more frequently if events or circumstances change that would more likely than not reduce the fair value of its reporting units below their carrying value.

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The following table presents changes to goodwill during the six months ended July 3, 2021 (in millions):

	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
Balance as of January 2, 2021	$	1,518.2	$	433.3	$	163.7	$	330.8	$	590.4
Translation Adjustments	(6.4)		(1.5)		(0.7)		(0.2)		(4.0)
Balance as of July 3, 2021	$	1,511.8	$	431.8	$	163.0	$	330.6	$	586.4
Cumulative Goodwill Impairment Charges	$	295.7	$	183.2	$	72.1	$	17.2	$	23.2

Intangible Assets

The following table presents intangible assets (in millions):

		July 3, 2021				January 2, 2021
	Weighted Average Amortization Period (Years)	Gross Value		Accumulated Amortization		Gross Value		Accumulated Amortization
Amortizable Intangible Assets:
Customer Relationships	17	$	704.1	$	366.1	$	708.6	$	349.4
Technology	14	145.9		110.0		146.3		108.0
Trademarks	14	37.0		28.4		37.7		27.7
		887.0		504.5		892.6		485.1
Non-Amortizable Trade Name		122.4		—		122.8		—
		$	1,009.4	$	504.5	$	1,015.4	$	485.1
Intangible Assets, Net of Amortization		$	504.9			$	530.3

Amortization expense recorded for the three and six months ended July 3, 2021 was $11.1 million and $22.3 million, respectively. Amortization expense recorded for the three and six months ended June 27, 2020 was $12.2 million and $24.4 million, respectively. Amortization expense for fiscal year 2021 is estimated to be $43.3 million. There were no intangible asset impairments during the three and six months ended July 3, 2021 and June 27, 2020, respectively.

The following table presents future estimated annual amortization for intangible assets (in millions):

Year	Estimated Amortization
2022	$	41.5
2023	41.5
2024	40.9
2025	38.8
2026	35.3

6. SEGMENT INFORMATION

The Company is comprised of four operating segments: Commercial Systems, Industrial Systems, Climate Solutions and Power Transmission Solutions.

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Commercial Systems segment produces fractional to approximately 5 horsepower AC and DC motors, electronic variable speed controls, fans, and blowers for commercial applications. These products serve markets including commercial building ventilation and HVAC, pool and spa, irrigation, dewatering, agriculture, and general commercial equipment.

Industrial Systems segment produces integral motors, generators, alternators and switchgear for industrial applications, along with aftermarket parts and kits to support such products. These products serve markets including agriculture, marine, mining, oil and gas, food and beverage, data centers, healthcare, prime and standby power, and general industrial equipment.

Climate Solutions segment produces small motors, electronic variable speed controls and air moving solutions serving markets including residential and light commercial HVAC, water heaters and commercial refrigeration.

Power Transmission Solutions segment produces, sells and services belt and chain drives, helical and worm gearing, mounted and unmounted bearings, couplings, modular plastic belts, conveying chains and components, hydraulic pump drives, large open gearing and specialty mechanical products serving markets including e-commerce, alternative energy, beverage, bulk handling, metals, special machinery, energy, aerospace and general industrial.

The Company evaluates performance based on the segment's income from operations. Corporate costs have been allocated to each segment based on the net sales of each segment. The reported external net sales of each segment are from external customers.

The following sets forth certain financial information attributable to the Company's operating segments for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Eliminations		Total
External Sales	$	269.3	$	145.2	$	257.3	$	215.1	$	—	$	886.9
Intersegment Sales	19.9		7.3		5.1		0.8		(33.1)		—
Total Sales	289.2		152.5		262.4		215.9		(33.1)		886.9
Gross Profit	67.5		26.2		74.0		83.8		—		251.5
Operating Expenses	40.3		23.1		27.0		49.8		—		140.2
Asset Impairments	1.8		—		0.5		—		—		2.3
Total Operating Expenses	42.1		23.1		27.5		49.8		—		142.5
Income from Operations	25.4		3.1		46.5		34.0		—		109.0
Depreciation and Amortization	7.8		5.7		3.6		13.4		—		30.5
Capital Expenditures	4.5		3.3		3.0		2.8		—		13.6
June 27, 2020
External Sales	$	175.9	$	120.6	$	178.2	$	159.4	$	—	$	634.1
Intersegment Sales	16.9		9.1		3.9		0.6		(30.5)		—
Total Sales	192.8		129.7		182.1		160.0		(30.5)		634.1
Gross Profit	42.4		24.9		47.4		55.6		—		170.3
Operating Expenses	34.2		21.7		26.6		39.1		—		121.6
Asset Impairments	2.0		—		0.8		—		—		2.8
Total Operating Expenses	36.2		21.7		27.4		39.1		—		124.4
Income from Operations	6.2		3.2		20.0		16.5		—		45.9
Depreciation and Amortization	8.3		6.0		5.0		14.0		—		33.3
Capital Expenditures	2.2		2.3		2.6		2.4		—		9.5

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	Six Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Eliminations		Total
External Sales	$	506.3	$	281.6	$	496.4	$	416.7	$	—	$	1,701.0
Intersegment Sales	37.4		11.0		9.4		1.5		(59.3)		—
Total Sales	543.7		292.6		505.8		418.2		(59.3)		1,701.0
Gross Profit	133.0		53.0		148.0		162.9		—		496.9
Operating Expenses	78.3		46.2		57.7		106.3		—		288.5
Asset Impairments	1.8		—		0.5		—		—		2.3
Total Operating Expenses	80.1		46.2		58.2		106.3		—		290.8
Income from Operations	52.9		6.8		89.8		56.6		—		206.1
Depreciation and Amortization	15.6		11.6		8.1		27.0		—		62.3
Capital Expenditures	7.8		5.7		6.2		4.6		—		24.3
June 27, 2020
External Sales	$	375.3	$	250.2	$	388.3	$	354.5	$	—	$	1,368.3
Intersegment Sales	28.7		15.8		8.4		1.3		(54.2)		—
Total Sales	404.0		266.0		396.7		355.8		(54.2)		1,368.3
Gross Profit	92.7		47.9		106.8		126.2		—		373.6
Operating Expenses	71.7		44.6		56.0		81.2		—		253.5
Gain on Divestiture of Businesses	(0.1)		—		—		—		—		(0.1)
Asset Impairments	2.8		0.2		1.3		—		—		4.3
Total Operating Expenses	74.4		44.8		57.3		81.2		—		257.7
Income from Operations	18.3		3.1		49.5		45.0		—		115.9
Depreciation and Amortization	16.6		11.9		9.7		27.7		—		65.9
Capital Expenditures	5.3		4.3		6.2		4.6		—		20.4

The following table presents identifiable assets information attributable to the Company's operating segments as of July 3, 2021 and January 2, 2021 (in millions):

	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
Identifiable Assets as of July 3, 2021	$	1,390.5	$	870.2	$	966.1	$	1,546.9	$	4,773.7
Identifiable Assets as of January 2, 2021	1,319.6		837.5		890.4		1,541.5		4,589.0

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7. DEBT AND BANK CREDIT FACILITIES

The following table presents the Company’s indebtedness as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021		January 2, 2021
Term Facility	$	620.0	$	670.0
Senior Notes	400.0		400.0
Other	4.3		4.6
Less: Debt Issuance Costs	(4.4)		(3.2)
Total	1,019.9		1,071.4
Less: Current Maturities	230.9		231.0
Long-Term Debt	$	789.0	$	840.4

Credit Agreement

On March 17, 2021, the Company entered into an amendment (the "First Amendment") with the Company's lenders to the Amended and Restated Credit Agreement, dated August 27, 2018 (the “Credit Agreement”) with JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders named therein. The First Amendment amended the Credit Agreement to, among other things, (i) permit the consummation of the Rexnord Transaction and the incurrence of indebtedness and liens in an aggregate principal amount not to exceed $2.1 billion (plus an additional $487.0 million of capacity for the DDTL Facility described below) in connection with the Rexnord Transaction; (ii) provide an increase in the aggregate principal amount of the revolving commitments under the Credit Agreement from $500.0 million to $750.0 million, (iii) provide an increase in the maximum leverage ratio (defined as, with certain adjustments, the ratio of the Company’s consolidated funded debt to EBITDA) permitted as of the last day of any fiscal quarter to 4.50 to 1.00, to the extent the funded debt to EBITDA ratio exceeds 3.00 to 1.00 upon the consummation of the Rexnord Transaction. The amendment is subject to customary and market provisions.

Prior to the First Amendment, the Credit Agreement provided for a (i) 5-year unsecured term loan facility in an original aggregate principal amount of $900.0 million (the “Term Facility”) and (ii) a 5-year unsecured multicurrency revolving facility in an aggregate principal amount of $500.0 million (increased as of the effectiveness of the First Amendment to $750.0 million) (the “Multicurrency Revolving Facility”), including a $50.0 million letter of credit sub facility, available for general corporate purposes. Borrowings under the Credit Agreement bear interest at floating rates based upon indices determined by the currency of the borrowing, plus an applicable margin determined by reference to the Company's consolidated funded debt to consolidated EBITDA ratio or at an alternative base rate.

The Term Facility under the Credit Agreement was drawn in full on August 27, 2018 with the proceeds settling the amounts owed under prior borrowings. The Term Facility requires quarterly amortization at a rate starting at 5.0% per annum, increasing to 7.5% per annum after three years and further increasing to 10.0% per annum for the last year of the Term Facility, unless previously prepaid. The weighted average interest rate on the Term Facility for the three months ended July 3, 2021 and June 27, 2020 was 1.4% and 1.6%, respectively. The weighted average interest rate on the Term Facility for the six months ended July 3, 2021 and June 27, 2020 was 1.5% and 2.9%, respectively. The Credit Agreement requires that the Company prepay the loans under the Term Facility with 100% of the net cash proceeds received from specified asset sales and borrowed money indebtedness, subject to certain exceptions.

At July 3, 2021, the Company had no borrowings under the Multicurrency Revolving Facility, $0.2 million of standby letters of credit issued under the facility, and $749.8 million of available borrowing capacity. For the three months ended July 3, 2021 and June 27, 2020 under the Multicurrency Revolving Facility, the average daily balance in borrowings was $2.4 million and $408.7 million, respectively, and the weighted average interest rate was 1.4% and 1.9%, respectively. For the six months ended July 3, 2021 and June 27, 2020 under the Multicurrency Revolving Facility, the average daily balance in borrowings was $4.9 million and $258.8 million, respectively, and the weighted average interest rate was 1.4% and 2.4%, respectively. The Company pays a non-use fee on the aggregate unused amount of the Multicurrency Revolving Facility at a rate determined by reference to its consolidated funded debt to consolidated EBITDA ratio.

Senior Notes

At July 3, 2021, the Company had $400.0 million of senior notes (the “Notes”) outstanding. The Notes consist of $400.0 million in senior notes in a private placement which were issued in five tranches with maturities from ten to twelve years and carry fixed interest rates. As of July 3, 2021, $230.0 million and $170.0 million of the Notes are included in Current Maturities of Long-Term Debt and Long-Term Debt, respectively, on the Condensed Consolidated Balance Sheets.

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The following table presents details on the Notes at July 3, 2021 (in millions):

	Principal		Interest Rate	Maturity
Fixed Rate Series 2011A	$	230.0	4.8 to 5.0%	July 14, 2021
Fixed Rate Series 2011A	170.0		4.9 to 5.1%	July 14, 2023
	$	400.0

The senior note that matured after quarter end on July 14, 2021, was paid via cash from operations and a draw on the Multicurrency Revolving Facility.

Compliance with Financial Covenants

The Credit Agreement and the Notes require the Company to meet specified financial ratios and to satisfy certain financial condition tests. The Company was in compliance with all financial covenants contained in the Notes and the Credit Agreement as of July 3, 2021.

Other Notes Payable

At July 3, 2021, other notes payable of approximately $4.3 million were outstanding with a weighted average interest rate of 4.9%. At January 2, 2021, other notes payable of approximately $4.6 million were outstanding with a weighted average rate of 4.9%.

Financing Arrangements Related to Rexnord Transaction

In connection with the Rexnord Transaction, on February 15, 2021, the Company entered into a debt commitment letter (the “Bridge Commitment Letter”) and related fee letters with Barclays Bank PLC (“Barclays”), pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide approximately $2.1 billion in an aggregate principal amount of senior bridge loans under a 364-day senior bridge loan credit facility (the “Bridge Facility”). The proceeds of the loans under the Bridge Facility may be used by the Company to (i) pay the Company Special Dividend, (ii) redeem the Notes due in 2023 and (iii) to pay fees and expenses in connection with the Rexnord Transaction.

Further, the Company entered into an additional debt commitment letter (the “Backstop Commitment Letter”) and related fee letters with Barclays, pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide a 364-day senior bridge loan credit facility in an aggregate principal amount of up to approximately $1.1 billion to prepay in full the aggregate principal amount of loans outstanding under the Credit Agreement in the event that certain required consents from the lenders under the Credit Agreement could not be obtained. On March 17, 2021, as further described above, the Company entered into the First Amendment to, among other things (i) permit the consummation of the Rexnord Transaction, as applicable, (ii) permit the incurrence of indebtedness to finance the Company Special Dividend and to finance the cash payment of Land to a subsidiary of Rexnord (the "Land Cash Payment") as contemplated by the Rexnord Transaction; and (iii) provide an increase of $250.0 million in the aggregate principal amount of the revolving commitments under the Existing Credit Agreement, as described in detail above under "Credit Agreement". Upon the effectiveness of the First Amendment, the Backstop Commitment Letter and the commitments thereunder were terminated.

In connection with the Rexnord Transaction, Land also entered into a debt commitment letter (the “Land Commitment Letter”) and related fee letters with Barclays, pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide approximately $487.0 million of bridge loans under a 364-day senior bridge loan facility to be used to pay the Land Cash Payment. Pursuant to the terms of the Merger Agreement, Land has entered into a permitted alternative financing to replace the commitments under the Land Commitment Letter. In particular, on May 14, 2021, Land entered into a Credit Agreement with JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders named therein, providing for a delayed draw term loan facility with commitments thereunder in an aggregate principal amount of $487.0 million, maturing in August 2023 (the "DDTL Facility"). Subject to satisfaction of the conditions therein, the DDTL Facility may be drawn in connection with the consummation of the Rexnord Transaction in order to fund the Land Cash Payment. The loans under the DDTL Facility will bear interest at floating rates, plus an applicable margin determined by reference to a consolidated funded debt to consolidated EBITDA ratio or at an alternative base rate. Upon the effectiveness of the DDTL Facility, the Land Commitment Letter and the commitments thereunder were terminated. If the Rexnord Transaction is consummated, the indebtedness contemplated by the Land Commitment Letter and DDTL Facility will become indebtedness of a wholly-owned subsidiary of the Company.

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The Company anticipates incurring significant fees and expenses in connection with the Rexnord Transaction, the amount of which is uncertain. In addition, the amount of the Company Special Dividend depends on the number of additional shares of the Company's common stock that must be issued in connection with the Rexnord Transaction in order to satisfy tax requirements applicable to a Reverse Morris Trust transaction. The size of the dividend that will ultimately be declared is uncertain and will remain so until the closing of the Rexnord Transaction.

Other Disclosures

Based on rates for instruments with comparable maturities and credit quality, which are classified as Level 2 inputs (see also Note 15), the approximate fair value of the Company's total debt was $1,031.1 million and $1,085.8 million as of July 3, 2021 and January 2, 2021, respectively.

8. RETIREMENT AND POST RETIREMENT HEALTH CARE PLANS

The following table presents the Company’s net periodic benefit cost (income) components (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Service Cost	$	0.3	$	0.3	$	0.6	$	1.1
Interest Cost	1.4		2.0		2.9		4.1
Expected Return on Plan Assets	(3.1)		(3.3)		(6.2)		(6.6)
Amortization of Prior Service Cost and Net Actuarial Loss	0.5		0.2		0.9		0.3
Net Periodic Benefit Income	$	(0.9)	$	(0.8)	$	(1.8)	$	(1.1)

The service cost component is included in Cost of Sales and Operating Expenses. All other components of net periodic benefit costs are included in Other Income, Net on the Company's Condensed Consolidated Statements of Income.

For the three months ended July 3, 2021 and June 27, 2020, the Company contributed $1.6 million and $1.2 million, respectively, to post retirement plans. For the six months ended July 3, 2021 and June 27, 2020, the Company contributed $2.8 million and $2.3 million, respectively. The Company expects to make total contributions of $5.8 million in 2021. The Company contributed a total of $8.5 million in fiscal 2020.

9. LEASES

The Company leases certain manufacturing facilities, warehouses/distribution centers, office space, machinery, equipment, IT assets, and vehicles. If the contract provides the Company the right to substantially all of the economic benefits from the use of the identified asset and the right to direct the use of the identified asset, it is considered to be or contain a lease. Right-of-use ("ROU") assets and lease liabilities are recognized at lease commencement date based on the present value of the future lease payments over the expected lease term.

As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The incremental borrowing rate is calculated based upon the sovereign treasury rate for the currency in which the lease liability is denominated when the Company takes possession of the leased asset, adjusted for various factors, such as term and internal credit spread. The ROU asset also includes any lease payments made and excludes lease incentive and initial direct costs incurred.

Leases entered into may include one or more options to renew. The renewal terms can extend the lease term from one to twenty-five years. The exercise of lease renewal options is at the Company's sole discretion. Renewal option periods are included in the measurement of the ROU asset and lease liability when the exercise is reasonably certain to occur. Some leases include options to terminate the lease upon breach of contract and are remeasured at that point in time.

The depreciable life of leased assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

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Some of the Company's lease agreements include rental payments adjusted periodically for inflation or are based on an index rate. These increases are reflected as variable lease payments and are included in the measurement of the ROU asset and lease liability. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Operating leases are included in the following asset and liability accounts on the Company's Condensed Consolidated Balance Sheet: Operating Lease Assets, Current Operating Lease Liabilities, and Noncurrent Operating Lease Liabilities. ROU assets and liabilities arising from finance leases are included in the following asset and liability accounts on the Company's Condensed Consolidated Balance Sheet: Net Property, Plant and Equipment, Current Maturities of Long-Term Debt, and Long-Term Debt.

Short-term and variable lease expenses were immaterial. The components of lease expense were as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Operating Lease Cost	$	7.7	$	7.6	$	15.4	$	15.3
Finance Lease Cost:
Amortization of ROU Assets	0.1		0.1		0.2		0.2
Interest on Lease Liabilities	0.1		—		0.1		0.1
Total Lease Expense	$	7.9	7.7		$	15.7	$	15.6

Maturity of lease liabilities as of July 3, 2021 were as follows (in millions):

	Operating Leases		Finance Leases		Total
Remainder of 2021	$	14.3	$	0.3	$	14.6
2022	22.4		0.5		22.9
2023	15.6		0.6		16.2
2024	10.6		0.6		11.2
2025	8.0		0.6		8.6
Thereafter	18.7		1.3		20.0
Total Lease Payments	$	89.6	$	3.9	$	93.5
Less: Interest	(14.4)		(0.7)		(15.1)
Present Value of Lease Liabilities	$	75.2	$	3.2	$	78.4

Other information related to leases was as follows (in millions):

	Six Months Ended
Supplemental Cash Flows Information	July 3, 2021			June 27, 2020
Cash Paid for Amounts Included in the Measurement of Lease Liabilities:
Operating Cash Flows Used For Operating Leases	$	12.4		$	14.8
Operating Cash Flows Used For Finance Leases	0.1			0.1
Financing Cash Flows Used For Finance Leases	0.2			0.2
Leased Assets Obtained in Exchange for New Operating Lease Liabilities	9.7			18.3
Weighted Average Remaining Lease Term
Operating Leases	4.4 years			5.2 years
Finance Leases	6.8 years			7.8 years
Weighted Average Discount Rate
Operating Leases	6.7		%	8.3		%
Finance Leases	5.9		%	5.9		%

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As of July 3, 2021, the Company has additional operating leases that have not yet commenced for future lease payments of $5.8 million. The Company had no finance leases that had not yet commenced nor entered into during the quarter.

10. SHAREHOLDERS’ EQUITY

Repurchase of Common Stock

At a meeting of the Board of Directors on October 25, 2019, the Company's Board of Directors approved the authorization to purchase up to $250.0 million of shares. The Company did not repurchase and retire any common stock during the three and six months ended July 3, 2021. For the six months ended June 27, 2020, the Company repurchased and retired 315,072 shares of its common stock at an average cost of $79.38 for a total cost of $25.0 million.

As of July 3, 2021, there was approximately $210.0 million in common stock available for repurchase under the October 2019 program.

Share-Based Compensation

The Company recognized approximately $4.5 million and $2.8 million in share-based compensation expense for the three months ended July 3, 2021 and June 27, 2020, respectively. Share-based compensation expense was $7.8 million and $5.5 million for the six months ended July 3, 2021 and June 27, 2020, respectively. The total income tax benefit recognized in the Condensed Consolidated Statements of Income for share-based compensation expense was $0.7 million and $0.2 million for the three months ended July 3, 2021 and June 27, 2020, respectively. The total income tax benefit recognized in the Condensed Consolidated Statements of Income for share-based compensation expense was $1.3 million and $0.4 million for the six months ended July 3, 2021 and June 27, 2020, respectively. The Company recognizes compensation expense on grants of share-based compensation awards on a straight-line basis over the vesting period of each award. As of July 3, 2021, total unrecognized compensation cost related to share-based compensation awards was approximately $25.1 million, net of estimated forfeitures, which the Company expects to recognize over a weighted average period of approximately 2.0 years.

Approximately 1.6 million shares were available for future grant under the 2018 Equity Incentive Plan as of July 3, 2021.

Stock Appreciation Rights

The Company uses stock settled stock appreciation rights (“SARs”) as a form of share-based incentive awards. SARs are the right to receive stock in an amount equal to the appreciation in value of a share of stock over the base price per share. Shares granted prior to fiscal 2020 generally vest over five years on the anniversary date while shares granted in or after fiscal 2020 generally vest over three years on the anniversary date of the grant date. Generally all grants expire 10 years from the grant date. All grants are made at prices equal to the fair market value of the stock on the grant date. For the six months ended July 3, 2021 and June 27, 2020, expired and canceled shares were immaterial.

The following table presents share-based compensation activity for the six months ended July 3, 2021 and June 27, 2020 (in millions):

	July 3, 2021		June 27, 2020
Total Intrinsic Value of Share-Based Incentive Awards Exercised	$	6.7	$	3.1
Cash Received from Stock Option Exercises	0.1		0.2
Income Tax Benefit from the Exercise of SARs	0.5		0.4
Total Fair Value of Share-Based Incentive Awards Vested	3.9		1.8

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The following table presents assumptions used in the Company's Black-Scholes valuation related to grants of SARs:

	2021			2020
Per share weighted average fair value of grants	$	37.43		$	21.23
Risk-free interest rate	0.6		%	1.5		%
Expected life (years)	5.0			7.0
Expected volatility	32.5		%	25.2		%
Expected dividend yield	0.9		%	1.4		%

The average risk-free interest rate is based on the US Treasury security rate as of the grant date. The expected dividend yield is based on the projected annual dividend as a percentage of the estimated market value of the Company's common stock as of the grant date. The Company estimated the expected volatility using a weighted average of daily historical volatility of the Company's stock price over the expected term of the award. The Company estimated the expected term using historical data.

The following table presents a summary of share-based incentive plan grant activity for the six months ended July 3, 2021.

Number of Shares Under SARs	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Outstanding as of January 2, 2021	577,509	$	79.35	7.0	$	25.1
Granted	114,069	140.28
Exercised	(98,418)	75.97
Forfeited	(19,660)	85.81
Expired	(4,050)	72.29
Outstanding as of July 3, 2021	569,450	$	91.96	7.4	$	24.3
Exercisable as of July 3, 2021	242,394	$	76.02	5.9	$	13.9

Compensation expense recognized related to SARs was $2.2 million for the six months ended July 3, 2021.

As of July 3, 2021, there was $7.6 million of unrecognized compensation cost related to non-vested SARs that is expected to be recognized as a charge to earnings over a weighted average period of 2.4 years.

The number of SARs expected to vest is materially consistent with those outstanding and not yet exercisable.

Restricted Stock Awards and Restricted Stock Units

Restricted stock awards ("RSA") and restricted stock units ("RSU") consist of shares or the rights to shares of the Company's stock. The awards are restricted such that they are subject to substantial risk of forfeiture and to restrictions on their sale or other transfer. As defined in the individual grant agreements, acceleration of vesting may occur under a change in control, death or disability.

The following table presents a summary of RSA award activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested RSAs as of January 2, 2021	16,280	$	70.05	0.3
Granted	7,760	149.50
Vested	(16,280)	70.05
Unvested RSAs as of July 3, 2021	7,760	$	149.50	0.8

RSAs vest on the first anniversary of the grant date, provided the holder of the shares is continuously employed by or in the service of the Company until the vesting date. Compensation expense recognized related to the RSAs was $0.6 million for the six months ended July 3, 2021.

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As of July 3, 2021, there was $1.0 million of unrecognized compensation cost related to non-vested RSAs that is expected to be recognized as a charge to earnings over a weighted average period of 0.8 years.

The following table presents a summary of RSU award activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested RSUs as of January 2, 2021	164,398	$	81.16	1.7
Granted	48,280	136.98
Vested	(63,177)	79.19
Forfeited	(6,589)	83.78
Unvested RSUs as of July 3, 2021	142,912	$	100.12	2.1

RSUs granted prior to fiscal 2020 vest on the third anniversary of the grant date while RSUs granted in or after fiscal 2020 vest one third each year on the anniversary of the grant date, provided the holder of the RSUs is continuously employed by the Company until the vesting date. Compensation expense recognized related to the RSUs was $3.3 million for the six months ended July 3, 2021.

As of July 3, 2021, there was $10.0 million of unrecognized compensation cost related to non-vested RSUs that is expected to be recognized as a charge to earnings over a weighted average period of 2.1 years.

Performance Share Units

Performance share units ("PSU") consist of shares or the rights to shares of the Company's stock which are awarded to employees of the Company. These shares are payable upon the determination that the Company achieved certain established performance targets and can range from 0% to 200% of the targeted payout based on the actual results. PSUs have a performance period of 3 years and vest 3 years from the grant date and are issued at a performance target of 100%. The PSUs have performance criteria based on a return on invested capital metric or they have performance criteria using returns relative to the Company's peer group. As set forth in the individual award agreements, acceleration of vesting may occur under a change in control, death or disability. There are no voting rights associated with these instruments until vesting occurs and a share of stock is issued. Some of the PSU awards are valued using a Monte Carlo simulation method as of the grant date while others are valued using the closing market price as of the grant date depending on the performance criteria for the award.

The assumptions used in the Company's Monte Carlo simulation were as follows:

	2021		2020
Risk-free interest rate	0.2	%	1.4	%
Expected life (years)	3.0		3.0
Expected volatility	37.0	%	24.0	%
Expected dividend yield	0.9	%	1.4	%

The following table presents a summary of PSU activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested PSUs as of January 2, 2021	87,522	$	97.59	1.8
Granted	33,125	122.36
Vested	(10,891)	91.65
Forfeited	(10,651)	78.88
Unvested PSUs as of July 3, 2021	99,105	$	109.68	1.9

Compensation expense for awards granted is recognized based on the grant issuance value or the expected payout ratio depending upon the performance criterion for the award, net of estimated forfeitures. Compensation expense recognized related to PSUs was $1.7 million for the six months ended July 3, 2021. Total unrecognized compensation expense for all PSUs granted as of July 3, 2021 is estimated to be $6.5 million which is expected to be recognized as a charge to earnings over a weighted average period of 1.9 years.

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11. INCOME TAXES

The effective tax rate for the three months ended July 3, 2021 was 19.1% versus 22.5% for the three months ended June 27, 2020. The effective tax rate for the six months ended July 3, 2021 and June 27, 2020 was 21.0% and 22.8%, respectively. The change in the effective tax rate for the three and six months ended July 3, 2021 was primarily driven by the mix of earnings.

As of July 3, 2021 and January 2, 2021, the Company had approximately $9.3 million and $6.8 million of unrecognized tax benefits, all of which would impact the effective income tax rate if recognized. Potential interest and penalties related to unrecognized tax benefits are recorded in income tax expense. The Company had approximately $2.9 million and $2.7 million of accrued interest as of July 3, 2021 and January 2, 2021, respectively.

With few exceptions, the Company is no longer subject to US Federal and state/local income tax examinations by tax authorities for years prior to 2015, and the Company is no longer subject to non-US income tax examinations by tax authorities for years prior to 2013.

12. EARNINGS PER SHARE

Diluted earnings per share is calculated based upon earnings applicable to common shares divided by the weighted-average number of common shares outstanding during the period adjusted for the effect of other dilutive securities. The amount of the anti-dilutive shares were 0.1 million and 0.6 million for the three months ended July 3, 2021 and June 27, 2020, respectively. The amount of the anti-dilutive shares were 0.1 million and 0.5 million for the six months ended July 3, 2021 and June 27, 2020, respectively. The following table reconciles the basic and diluted shares used in earnings per share calculations for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended		Six Months Ended
	July 3, 2021	June 27, 2020	July 3, 2021	June 27, 2020
Denominator for Basic Earnings Per Share	40.7	40.5	40.6	40.6
Effect of Dilutive Securities	0.3	0.2	0.4	0.1
Denominator for Diluted Earnings Per Share	41.0	40.7	41.0	40.7

13. CONTINGENCIES

One of the Company's subsidiaries that it acquired in 2007 is subject to numerous claims filed in various jurisdictions relating to certain sub-fractional motors that were primarily manufactured through 2004 and that were included as components of residential and commercial ventilation units manufactured and sold in high volumes by a third party. These ventilation units are subject to product safety requirements and other potential regulation of their performance by government agencies such as the US Consumer Product Safety Commission (“CPSC”). The claims generally allege that the ventilation units were the cause of fires. The Company has recorded an estimated liability for incurred claims. Based on the current facts, the Company cannot assure that these claims, individually or in the aggregate, will not have a material adverse effect on its subsidiary's financial condition. The Company's subsidiary cannot reasonably predict the outcome of these claims, the nature or extent of any CPSC or other remedial actions, if any, that the Company's subsidiary may need to undertake with respect to motors that remain in the field, or the costs that may be incurred, some of which could be significant.

The Company is, from time to time, party to litigation and other legal or regulatory proceedings that arise in the normal course of its business operations and the outcomes of which are subject to significant uncertainty, including product warranty and liability claims, contract disputes and environmental, asbestos, intellectual property, employment and other litigation matters. The Company's products are used in a variety of industrial, commercial and residential applications that subject the Company to claims that the use of its products is alleged to have resulted in injury or other damage. Many of these matters will only be resolved when one or more future events occur or fail to occur. Management conducts regular reviews, including updates from legal counsel, to assess the need for accounting recognition or disclosure of these contingencies, and such assessment inherently involves an exercise in judgment. The Company accrues for exposures in amounts that it believes are adequate, and the Company does not believe that the outcome of any such lawsuit individually or collectively will have a material effect on the Company's financial position, its results of operations or its cash flows.

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The Company recognizes the cost associated with its standard warranty on its products at the time of sale. The amount recognized is based on historical experience. The following table presents a reconciliation of the changes in accrued warranty costs for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning Balance	$	16.3	$	15.4	$	15.5	$	15.1
Less: Payments	(4.2)		(3.3)		(8.7)		(6.9)
Provisions	4.6		3.5		10.0		7.5
Translation Adjustments	—		0.1		(0.1)		—
Ending Balance	$	16.7	$	15.7	$	16.7	$	15.7

These liabilities are included in Other Accrued Expenses and Other Noncurrent Liabilities on the Condensed Consolidated Balance Sheet.

14. DERIVATIVE FINANCIAL INSTRUMENTS

The Company is exposed to certain risks relating to its ongoing business operations. The primary risks managed using derivative instruments are commodity price risk, currency exchange risk, and interest rate risk. Forward contracts on certain commodities are entered into to manage the price risk associated with forecasted purchases of materials used in the Company's manufacturing process. Forward contracts on certain currencies are entered into to manage forecasted cash flows in certain foreign currencies. Interest rate swaps are utilized to manage interest rate risk associated with the Company's floating rate borrowings.

The Company is exposed to credit losses in the event of non-performance by the counterparties to various financial agreements, including its commodity hedging transactions, foreign currency exchange contracts and interest rate swap agreements. Exposure to counterparty credit risk is managed by limiting counterparties to major international banks and financial institutions meeting established credit guidelines and continually monitoring their compliance with the credit guidelines. The Company does not obtain collateral or other security to support financial instruments subject to credit risk. The Company does not anticipate non-performance by its counterparties, but cannot provide assurances.

The Company recognizes all derivative instruments as either assets or liabilities at fair value in the Condensed Consolidated Balance Sheets. The Company designates commodity forward contracts as cash flow hedges of forecasted purchases of commodities, currency forward contracts as cash flow hedges of forecasted foreign currency cash flows and interest rate swaps as cash flow hedges of forecasted LIBOR-based interest payments. There were no significant collateral deposits on derivative financial instruments as of July 3, 2021 or June 27, 2020.

Cash Flow Hedges

The effective portion of the gain or loss on the derivative is reported as a component of AOCI and reclassified into the same line within the Condensed Consolidated Statement of Income as the earnings effect of the hedged item in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or changes in market value of derivatives not designated as hedges are recognized in current earnings.

At July 3, 2021, the Company had $10.7 million, net of tax, of derivative gains on closed hedge instruments in AOCI that will be realized in earnings when the hedged items impact earnings. At January 2, 2021, the Company had $3.7 million, net of tax, of derivative gains on closed hedge instruments in AOCI that was subsequently realized in earnings when the hedged items impacted earnings.

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As of July 3, 2021, the Company had the following currency forward contracts outstanding (with maturities extending through December 2022) to hedge forecasted foreign currency cash flows (in millions):

	Notional Amount (in US Dollars)
Chinese Renminbi	$	146.1
Mexican Peso	194.1
Euro	141.7
Indian Rupee	49.5
Canadian Dollar	1.0
Australian Dollar	20.3
British Pound	10.8
Thai Baht	5.7

As of July 3, 2021, the Company had the following commodity forward contracts outstanding (with maturities extending through December 2022) to hedge forecasted purchases of commodities (notional amounts expressed in terms of the dollar value of the hedged item (in millions)):

	Notional Amount
Copper	$	135.5
Aluminum	8.0

In April 2018, the Company entered into a spot, non-amortizing interest rate swap to pay fixed/ receive floating with a notional amount of $88.4 million to manage fluctuations in cash flows from interest rate risk related to floating rate interest. The swap expired in April, 2021 and was settled using cash from operations.

The Company entered into two receive variable/pay-fixed forward starting non-amortizing interest rate swaps in June 2020, with a total notional amount of $250.0 million. These swaps became effective July 2021 and will expire in July 2025.

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The following table presents the fair values of derivative instruments as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021
	Prepaid Expenses and Other Current Assets		Other Noncurrent Assets		Other Accrued Expenses		Other Noncurrent Liabilities
Designated as Hedging Instruments:
Interest Rate Swap Contracts	$	—	$	1.8	$	—	$	—
Currency Contracts	13.6		0.9		0.9		0.1
Commodity Contracts	16.3		1.1		1.4		0.5
Not Designated as Hedging Instruments:
Currency Contracts	—		—		0.3		—
Commodity Contracts	0.4		0.1		—		—
Total Derivatives	$	30.3	$	3.9	$	2.6	$	0.6

	January 2, 2021
	Prepaid Expenses and Other Current Assets		Other Noncurrent Assets		Other Accrued Expenses		Other Noncurrent Liabilities
Designated as Hedging Instruments:
Interest Rate Swap Contracts	$	—	$	—	$	0.7	$	1.4
Currency Contracts	16.4		1.6		1.0		0.1
Commodity Contracts	11.3		0.1		—		—
Not Designated as Hedging Instruments:
Currency Contracts	0.2		—		—		—
Commodity Contracts	0.1		—		—		—
Total Derivatives	$	28.0	$	1.7	$	1.7	$	1.5

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The following table presents the effect of derivative instruments on the Condensed Consolidated Statements of Income and Condensed Consolidated Statement of Comprehensive Income (pre-tax) (in millions):

Derivatives Designated as Cash Flow Hedging Instruments

	Three Months Ended
	July 3, 2021								June 27, 2020
	Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total		Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	$	10.9	$	7.5	$	(0.9)	$	17.5	$	12.6	$	2.8	$	(0.5)	$	14.9
Amounts Reclassified from Other Comprehensive Income (Loss):
Loss recognized in Net Sales	—		—		—		—		—		(0.1)		—		(0.1)
Gain (Loss) Recognized in Cost of Sales	8.6		4.0		—		12.6		(0.9)		0.3		—		(0.6)
Loss Recognized in Operating Expenses	—		(1.3)		—		(1.3)		—		(1.6)		—		(1.6)
Gain Recognized in Interest Expense	—		—		—		—		—		—		0.2		0.2
	Six Months Ended
	July 3, 2021								June 27, 2020
	Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total		Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	$	25.0	$	7.7	$	4.0	$	36.7	$	(0.7)	$	(22.3)	$	(1.1)	$	(24.1)
Amounts Reclassified from Other Comprehensive Income (Loss):
Gain Recognized in Net Sales	—		0.1		—		0.1		—		—		—		—
Gain (Loss) Recognized in Cost of Sales	13.8		6.6		—		20.4		(2.0)		2.8		—		0.8
Gain (Loss) Recognized in Operating Expenses	—		2.2		—		2.2		—		(0.9)		—		(0.9)
Gain Recognized in Interest Expense	—		—		0.1		0.1		—		—		0.6		0.6

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Derivatives Not Designated as Cash Flow Hedging Instruments (in millions):

	Three Months Ended
	July 3, 2021				June 27, 2020
	Commodity Forwards		Currency Forwards		Commodity Forwards		Currency Forwards
Gain recognized in Cost of Sales	$	0.2	$	—	$	0.1	$	—
Gain (Loss) recognized in Operating Expenses	—		(3.7)		—		2.1
	Six Months Ended
	July 3, 2021				June 27, 2020
	Commodity Forwards		Currency Forwards		Commodity Forwards		Currency Forwards
Gain recognized in Cost of Sales	$	0.4	$	—	$	—	$	—
Gain (Loss) recognized in Operating Expenses	—		2.1		—		(1.3)

The net AOCI hedging component balance of a $34.1 million gain at July 3, 2021 includes $20.9 million of net current deferred gain expected to be realized in the next twelve months. The gain/loss reclassified from AOCI into earnings on such derivatives will be recognized in the same period in which the related item affects earnings.

The Company's commodity and currency derivative contracts are subject to master netting agreements with the respective counterparties which allow the Company to net settle transactions with a single net amount payable by one party to another party. The Company has elected to present the derivative assets and derivative liabilities on the Condensed Consolidated Balance Sheets on a gross basis for the periods ended July 3, 2021 and January 2, 2021.

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The following table presents the derivative assets and derivative liabilities presented on a net basis under enforceable master netting agreements (in millions):

	July 3, 2021
	Gross Amounts as Presented in the Condensed Consolidated Balance Sheet		Derivative Contract Amounts Subject to Right of Offset		Derivative Contracts as Presented on a Net Basis
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	13.6	$	(1.2)	$	12.4
Derivative Commodity Contracts	16.7		(1.4)		15.3
Other Noncurrent Assets:
Derivative Currency Contracts	0.9		—		0.9
Derivative Commodity Contracts	1.2		(0.4)		0.8
Other Accrued Expenses:
Derivative Currency Contracts	1.2		(1.2)		—
Derivative Commodity Contracts	1.4		(1.4)		—
Other Noncurrent Liabilities:
Derivative Currency Contracts	0.1		—		0.1
Derivative Commodity Contracts	0.5		(0.4)		0.1

	January 2, 2021
	Gross Amounts as Presented in the Condensed Consolidated Balance Sheet		Derivative Contract Amounts Subject to Right of Offset		Derivative Contracts as Presented on a Net Basis
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	16.6	$	(1.0)	$	15.6
Derivative Commodity Contracts	11.4		—		11.4
Other Noncurrent Assets:
Derivative Currency Contracts	1.6		—		1.6
Derivative Commodity Contracts	0.1		—		0.1
Other Accrued Expenses:
Derivative Currency Contracts	1.0		(1.0)		—
Other Noncurrent Liabilities:
Derivative Currency Contracts	0.1		—		0.1

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15. FAIR VALUE

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The inputs used to measure fair value are classified into the following hierarchy:

Level 1	Unadjusted quoted prices in active markets for identical assets or liabilities
Level 2	Unadjusted quoted prices in active markets for similar assets or liabilities, or
	Unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or
	Inputs other than quoted prices that are observable for the asset or liability
Level 3	Unobservable inputs for the asset or liability

The Company uses the best available information in measuring fair value. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The fair values of cash equivalents and short-term deposits approximate their carrying values as of July 3, 2021 and January 2, 2021, due to the short period of time to maturity and are classified using Level 1 inputs. The fair values of trade receivables and accounts payable approximate the carrying values due to the short period of time to maturity. See Note 7 for disclosure of the approximate fair value of the Company's debt at July 3, 2021 and January 2, 2021.

The following table sets forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021		January 2, 2021		Classification
Assets:
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	13.6	$	16.6	Level 2
Derivative Commodity Contracts	16.7		11.4		Level 2
Other Noncurrent Assets:
Assets Held in Rabbi Trust	6.7		6.5		Level 1
Derivative Currency Contracts	0.9		1.6		Level 2
Derivative Commodity Contracts	1.2		0.1		Level 2
Interest Rate Swap	1.8		—		Level 2
Liabilities:
Other Accrued Expenses:
Interest Rate Swap	—		0.7		Level 2
Derivative Currency Contracts	1.2		1.0		Level 2
Derivative Commodity Contracts	1.4		—		Level 2
Other Noncurrent Liabilities:
Interest Rate Swap	—		1.4		Level 2
Derivative Currency Contracts	0.1		0.1		Level 2
Derivative Commodity Contracts	0.5		—		Level 2

Level 1 fair value measurements for assets held in a Rabbi Trust are unadjusted quoted prices.

Level 2 fair value measurements for derivative assets and liabilities are measured using quoted prices in active markets for similar assets and liabilities. Interest rate swaps are valued based on the discounted cash flows for the LIBOR forward yield curve for a swap with similar contractual terms. Foreign currency forwards are valued based on exchange rates quoted by domestic and foreign banks for similar instruments. Commodity forwards are valued based on observable market transactions of forward commodity prices.

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16. RESTRUCTURING ACTIVITIES

The Company incurred restructuring and restructuring-related costs on projects during fiscal 2021 and 2020. Restructuring costs include employee termination and plant relocation costs. Restructuring-related costs include costs directly associated with actions resulting from the Company's simplification initiatives, such as asset write-downs or accelerated depreciation due to shortened useful lives in connection with site closures, discretionary employment benefit costs and other facility rationalization costs. Restructuring costs for employee termination expenses are generally required to be accrued over the employees' remaining service period while restructuring costs for plant relocation costs and restructuring-related costs are generally required to be expensed as incurred.

The following table presents a reconciliation of provisions and payments for the restructuring projects for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning Balance	$	2.7	$	2.4	$	2.0	$	0.9
Provision	1.5		7.8		3.2		12.9
Less: Payments/ Other	1.7		7.3		2.7		10.9
Ending Balance	$	2.5	$	2.9	$	2.5	$	2.9

The following table presents a reconciliation of restructuring and restructuring-related costs for restructuring projects for the three and six months ended July 3, 2021 and June 27, 2020, respectively (in millions):

	Three Months Ended
	July 3, 2021						June 27, 2020
Restructuring Costs:	Cost of Sales		Operating Expenses		Total		Cost of Sales		Operating Expenses		Total
Employee Termination Expenses	$	0.2	$	0.2	$	0.4	$	1.4	$	2.6	$	4.0
Facility Related Costs	0.8		0.1		0.9		3.2		0.4		3.6
Other Expenses	0.2		—		0.2		0.2		—		0.2
Total Restructuring Costs	$	1.2	$	0.3	$	1.5	$	4.8	$	3.0	$	7.8
	Six Months Ended
	July 3, 2021						June 27, 2020
Restructuring Costs:	Cost of Sales		Operating Expenses		Total		Cost of Sales		Operating Expenses		Total
Employee Termination Expenses	$	0.4	$	0.6	$	1.0	$	2.9	$	3.0	$	5.9
Facility Related Costs	1.6		0.3		1.9		5.9		0.8		6.7
Other Expenses	0.3		—		0.3		0.3		—		0.3
Total Restructuring Costs	$	2.3	$	0.9	$	3.2	$	9.1	$	3.8	$	12.9

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The following table presents the allocation of restructuring and restructuring-related costs by segment for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

Restructuring Costs - Three Months Ended	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
July 3, 2021	$	1.5	$	0.1	$	0.3	$	0.3	$	0.8
June 27, 2020	$	7.8	$	2.3	$	2.0	$	1.3	$	2.2
Restructuring Costs - Six Months Ended	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
July 3, 2021	$	3.2	$	0.3	$	0.8	$	0.6	$	1.5
June 27, 2020	$	12.9	$	4.1	$	2.9	$	2.4	$	3.5

The Company's current restructuring activities are expected to continue. The Company expects to record aggregate future charges of approximately $3.5 million which includes $1.9 million of employee termination expenses and $1.6 million of facility related costs on approved projects. The Company anticipates total restructuring costs of approximately $16.0 million for fiscal 2021 excluding costs related to the Rexnord Transaction.

17. SUBSEQUENT EVENT

The Company has evaluated subsequent events since July 3, 2021, the date of these financial statements, and is not aware of any events to disclose.

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

Unless the context requires otherwise, references in this Item 2 to “we,” “us,” “our” or the “Company” refer collectively to Regal Beloit Corporation and its subsidiaries.

Overview

Regal Beloit Corporation (NYSE: RBC), based in Beloit, Wisconsin (USA), is a leading manufacturer of electric motors, electrical motion controls, power generation and power transmission products serving markets throughout the world.

Operating Segments

Our company is comprised of four operating segments: Commercial Systems, Industrial Systems, Climate Solutions and Power Transmission Solutions.

A description of the four operating segments is as follows:

•Commercial Systems segment produces fractional to approximately 5 horsepower AC and DC motors, electronic variable speed controls, fans, and blowers for commercial applications. These products serve markets including commercial building ventilation and HVAC, pool and spa, irrigation, dewatering, agriculture, and general commercial equipment.

•Industrial Systems segment produces integral motors, generators, alternators and switchgear for industrial applications, along with aftermarket parts and kits to support such products. These products serve markets including agriculture, marine, mining, oil and gas, food and beverage, data centers, healthcare, prime and standby power, and general industrial equipment.

•Climate Solutions segment produces small motors, electronic variable speed controls and air moving solutions serving markets including residential and light commercial HVAC, water heaters and commercial refrigeration.

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•Power Transmission Solutions segment produces, sells and services belt and chain drives, helical and worm gearing, mounted and unmounted bearings, couplings, modular plastic belts, conveying chains and components, hydraulic pump drives, large open gearing and specialty mechanical products serving markets including e-commerce, alternative energy, beverage, bulk handling, metals, special machinery, energy, aerospace and general industrial.

Components of Profit and Loss

Net Sales. We sell our products to a variety of manufacturers, distributors and end users. Our customers consist of a large cross-section of businesses, ranging from Fortune 100 companies to small businesses. A number of our products are sold to Original Equipment Manufacturers ("OEMs"), who incorporate our products, such as electric motors, into products they manufacture, and many of our products are built to the requirements of our customers. The majority of our sales derive from direct sales to customers by sales personnel employed by the Company, however, a significant portion of our sales are derived from sales made by manufacturer’s representatives, who are paid exclusively on commission. Our product sales are made via purchase order, long-term contract, and, in some instances, one-time purchases. Many of our products have broad customer bases, with the levels of concentration of revenues varying from business unit to business unit.

Our level of net sales for any given period is dependent upon a number of factors, including (i) the demand for our products; (ii) the strength of the economy generally and the end markets in which we compete; (iii) our customers’ perceptions of our product quality at any given time; (iv) our ability to timely meet customer demands; (v) the selling price of our products; and (vi) the weather. As a result, our total revenue has tended to experience quarterly variations and our total revenue for any particular quarter may not be indicative of future results.

We use the term “organic sales" to refer to sales from existing operations excluding (i) sales from acquired businesses recorded prior to the first anniversary of the acquisition (“Acquisition Sales”), (ii) less the amount of sales attributable to any businesses divested/to be exited, and (iii) the impact of foreign currency translation. The impact of foreign currency translation is determined by translating the respective period’s organic sales using the same currency exchange rates that were in effect during the prior year periods. We use the term “organic sales growth” to refer to the increase in our sales between periods that is attributable to organic sales. We use the term “acquisition growth” to refer to the increase in our sales between periods that is attributable to Acquisition Sales.

Gross Profit. Our gross profit is impacted by our levels of net sales and cost of sales. Our cost of sales consists of costs for, among other things (i) raw materials, including copper, steel and aluminum; (ii) components such as castings, bars, tools, bearings and electronics; (iii) wages and related personnel expenses for fabrication, assembly and logistics personnel; (iv) manufacturing facilities, including depreciation on our manufacturing facilities and equipment, insurance and utilities; and (v) shipping. The majority of our cost of sales consists of raw materials and components. The price we pay for commodities and components can be subject to commodity price fluctuations. We attempt to mitigate this through fixed-price agreements with suppliers and our hedging strategies. When we experience commodity price increases, we have tended to announce price increase to our customers who purchase via purchase order, with such increases generally taking effect a period of time after the public announcements. For those sales we make under long-term contracts, we tend to include material price formulas that specify quarterly or semi-annual price adjustments based on a variety of factors, including commodity prices.

Outside of general economic cyclicality, our business units experience different levels of variation in gross profit from quarter to quarter based on factors specific to each business. For example, a portion of our Climate Solutions segment manufactures products that are used in air conditioning applications. As a result, our sales for that business tend to be lower in the first and fourth quarters and higher in the second and third quarters. In contrast, our Commercial Systems segment, Industrial Systems segment and Power Transmission Solutions segment have a broad customer base and a variety of applications, thereby helping to mitigate large quarter-to-quarter fluctuations outside of general economic conditions.

Operating Expenses. Our operating expenses consist primarily of (i) general and administrative expenses; (ii) sales and marketing expenses; (iii) general engineering and research and development expenses; and (iv) handling costs incurred in conjunction with distribution activities. Personnel related costs are our largest operating expense.

Our general and administrative expenses consist primarily of costs for (i) salaries, benefits and other personnel expenses related to our executive, finance, human resource, information technology, legal and operations functions; (ii) occupancy expenses; (iii) technology related costs; (iv) depreciation and amortization; and (v) corporate-related travel. The majority of our general and administrative costs are for salaries and related personnel expenses. These costs can vary by business given the location of our different manufacturing operations.

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Our sales and marketing expenses consist primarily of costs for (i) salaries, benefits and other personnel expenses related to our sales and marketing function; (ii) internal and external sales commissions and bonuses; (iii) travel, lodging and other out-of-pocket expenses associated with our selling efforts; and (iv) other related overhead.

Our general engineering and research and development expenses consist primarily of costs for (i) salaries, benefits and other personnel expenses; (ii) the design and development of new energy efficiency products and enhancements; (iii) quality assurance and testing; and (iv) other related overhead. Our research and development efforts tend to be targeted toward developing new products that would allow us to maintain or gain additional market share, whether in new or existing applications. While these costs make up an insignificant portion of our operating expenses in the Power Transmission Solutions segment, they are more substantial in our Commercial Systems, Industrial Systems and Climate Solutions segments. In particular, a large driver of our research and development efforts in those three segments is energy efficiency, which generally means using less electrical power to produce more mechanical power.

Operating Profit. Our operating profit consists of the segment gross profit less the segment operating expenses. In addition, there are shared operating costs that cover corporate and information technology expenses that are consistently allocated to the operating segments and are included in the segment operating expenses. Operating profit is a key metric used to measure year over year improvement of the segments.

Restructuring and Restructuring Related Costs. We incurred restructuring-related costs on employee termination and plant relocation costs. Restructuring related costs includes costs directly associated with actions resulting from our simplification initiatives, such as asset write-downs or accelerated depreciation due to shortened useful lives in connection with site closures, discretionary employment benefit costs and other facility rationalization costs. Restructuring costs for employee termination expenses are generally required to be accrued over the employees remaining service period while restructuring costs for plant relocation costs and restructuring-related costs are generally required to be expensed as incurred.

COVID-19 Pandemic

COVID-19 evolved during the first quarter of 2020 into a global pandemic, resulting in a severe global health crisis that drove a dramatic slowdown in global economic and social activity.

In the face of this global crisis, our first priority has been the health and safety of our associates. In response, we implemented a host of measures to help our associates stay safe, measures that have been enhanced and refined as impacts from COVID-19 grew, and as our knowledge about how to enhance their effectiveness improved.

Factors deriving from the COVID-19 response that have or may negatively impact sales and operating profit in the future include, but are not limited to: limitations on the ability of our suppliers to manufacture, or procure from manufacturers, components and raw materials used in our products, or to meet delivery requirements and commitments; limitations on the ability of our employees to perform their work due to illness caused by the pandemic or local, state, or federal orders requiring employees to remain at home; limitations on the ability of carriers to deliver our products to customers; limitations on the ability of our customers to conduct their business and purchase our products and services; reductions in demands of our customers; and limitations on the ability of our customers to pay us on a timely basis.

We continue to monitor the pandemic and make adjustments to the business as necessary to address any limitations or negative impacts.

Rexnord Transaction

On February 15, 2021, we entered into definitive agreements with Rexnord Corporation (“Rexnord”), Land Newco, Inc., a wholly owned indirect subsidiary of Rexnord (“Land”), and Phoenix 2021, Inc., our wholly owned subsidiary (“Merger Sub”), with respect to a Reverse Morris Trust transaction (the “Rexnord Transaction”) pursuant to which, and subject to the terms and conditions of those definitive agreements discussed below, (1) Rexnord will transfer (or cause to be transferred) to Land substantially all of the assets, and Land will assume substantially all of the liabilities, of Rexnord’s Process & Motion Control business (“PMC Business”) (the “Reorganization”), (2) after which, all of the issued and outstanding shares of common stock, $0.01 par value per share, of Land (“Land common stock”) held by a subsidiary of Rexnord will be distributed in a series of distributions to Rexnord’s stockholders (the “Distributions”, and the final distribution of Land common stock from Rexnord to Rexnord’s stockholders, which is to be made pro rata for no consideration, the “Spin-Off”) and (3) immediately after the Spin-Off, Merger Sub will merge with and into Land (the “Merger”) and all shares of Land common stock (other than those held by Rexnord, Land, the Company, Merger Sub or their respective subsidiaries) will be converted into the right to receive shares of our common stock, $0.01 par value per share (“Company common stock”), as calculated and subject to adjustment as set forth

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in the Merger Agreement (as defined below). When the Merger is completed, Land (which at that time will hold the PMC Business) will be our wholly owned subsidiary.

The definitive agreements we entered into in connection with the Rexnord Transaction include an Agreement and Plan of Merger, by and among Rexnord, Land, Merger Sub and the Company (the “Merger Agreement”), a Separation and Distribution Agreement, by and among Rexnord, Land and the Company as well as and certain ancillary agreements.

In connection with the Rexnord Transaction, the Merger Agreement provides that we shall, to the extent required by the Merger Agreement, in certain circumstances in which additional shares of Company common stock are issued at the closing of the Rexnord Transaction to holders of Land common stock, declare a special dividend to our shareholders immediately prior to the consummation of the Merger (the “Company Special Dividend”). The existence and magnitude of the Company Special Dividend will depend on whether and to what extent we are able to count certain overlapping shareholders of us and Rexnord in satisfying the tax requirements applicable to a Reverse Morris Trust transaction. In the event that the Company Special Dividend is required to be paid, it could range in amount between zero and approximately $2.0 billion.

In connection with the Rexnord Transaction, we have entered into certain financing arrangements, which are described below under “Liquidity and Capital Resources”.

Closing of the Rexnord Transaction is subject to various closing conditions, including the consummation of the Reorganization and the Distributions, receipt of the approval of our shareholders and Rexnord's stockholders and other customary closing conditions.

Outlook

The Company is projecting increased sales growth for the remainder of the year which assumes no material decline in production capacity or its ability to conduct commercial operations, either from COVID-related disruptions, or other factors, including supply chain disruptions, versus levels as of the date of this report. The guidance does not take into account any costs, expenses or other effects with respect to the Rexnord Transaction.

Results of Operations

Three Months Ended July 3, 2021 Compared to June 27, 2020

Net sales increased $252.8 million or 39.9% for the second quarter 2021 compared to the second quarter 2020. The increase consisted of positive organic sales of 37.2% and positive foreign currency translation of 2.7%. The increase was primarily driven by sales increases in North American markets and a resurgence in China. Gross profit increased $81.2 million or 47.7% for the second quarter 2021 as compared to the second quarter 2020. The increase in gross profit was driven by increase in volume and partially offset by increased freight and material costs. Total operating expenses for the second quarter 2021 increased $18.1 million or 14.5% as compared to the second quarter 2020. The increase was primarily driven by due diligence fees associated with the Rexnord Transaction, and employee related wage and benefit costs which were partially offset by foreign exchange gains.

Commercial Systems Segment net sales for the second quarter 2021 were $269.3 million, an increase of $93.4 million or 53.1% as compared to the second quarter 2020. The increase consisted of positive organic sales of 49.6% and positive foreign currency translation of 3.5%. The increase was primarily driven by strong growth in general industry and pool pump business as well as solid gains in the Asia Pacific market. Gross profit increased $25.1 million or 59.2% as compared to the second quarter 2020. The increase in gross profit was primarily driven by the increase in volume and favorable product mix, partially offset by increased freight cost. Total operating expenses for the second quarter 2021 were $42.1 million compared to $36.2 million in the second quarter 2020. The $5.9 million or 16.3% increase was primarily driven by higher employee related wage and benefit costs as well as increased engineering expenses.

Industrial Systems Segment net sales for the second quarter 2021 were $145.2 million, an increase of $24.6 million or 20.4% as compared to the second quarter 2020. The increase consisted of positive organic sales of 15.2% and positive foreign currency translation of 5.2%. The increase was primarily driven by strength in the data center market, demand for industrial motors in North America and resurgent economic growth in the China market. Gross profit increased $1.3 million or 5.2% as compared to the second quarter 2020. The increase in gross profit was primarily driven by strong volumes, favorable mix and positive price realization, offset by material inflation and the impact of supply chain disruptions. Total operating expenses for the second quarter 2021 and 2020 were $23.1 million and $21.7 million, respectively. The increase in operating expenses was due to higher employee related wage and benefit costs, higher variable selling costs on stronger sales volume, and increased administrative costs partially offset by general cost savings initiatives and foreign exchange gains.

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Climate Solutions Segment net sales were $257.3 million, an increase of $79.1 million or 44.4% as compared to the second quarter 2020. The increase consisted of positive organic sales of 43.4% and positive foreign currency translation of 1.0%. The increase was primarily due to continued strong demand in North American residential HVAC and recovering demand in EMEA. Gross profit increased $26.6 million or 56.1% compared to the second quarter 2020. The increase in gross profit was primarily driven by increased volume, favorable product mix and 80/20 actions. Total operating expenses for the second quarter 2021 were $27.5 million compared to $27.4 million in the second quarter 2020. The slight increase was primarily due to 2020 cost savings as a result of non-recurring furloughs, which was offset by gains in foreign exchange.

Power Transmission Solutions Segment net sales for the second quarter 2021 were $215.1 million, an increase of $55.7 million or 34.9% compared to second quarter 2020 net sales of $159.4 million. The increase consisted of positive organic sales of 33.1% and positive foreign currency of 1.8%. The increase was primarily driven by strength in alternative energy and in the conveying business and recovering shorter cycle North American general industrial end markets. Gross profit for the second quarter 2021 increased $28.2 million or 50.7%. The increase was driven by higher sales volume with favorable mix and lower overhead cost driven by cost reduction initiatives. Total operating expenses for the second quarter 2021 increased $10.7 million as compared to the second quarter 2020, primarily due to due diligence fees related to the Rexnord Transaction.

Six Months Ended July 3, 2021 Compared to June 27, 2020

Net sales increased $332.7 million or 24.3% for the six months ended July 3, 2021 compared to the six months ended June 27, 2020. The increase consisted of positive organic sales of 22.1% and positive foreign currency translation of 2.2%. The increase was primarily driven by sales increases in North America, China and recovering demand in EMEA and Asia Pacific. Gross profit increased $123.3 million or 33.0% for the six months ended July 3, 2021 as compared to the six months ended June 27, 2020. The increase in gross profit was driven by increase in volume, partially offset by increased freight and material costs. Total operating expenses for the six months ended July 3, 2021 increased $33.1 million or 12.8% as compared to the six months ended June 27, 2020. The increase was primarily driven by due diligence fees associated with the Rexnord Transaction, higher employee related wage and benefit costs, partially offset by foreign exchange gains.

Commercial Systems Segment net sales for the six months ended July 3, 2021 were $506.3 million, an increase of $131.0 million or 34.9% as compared to the six months ended June 27, 2020. The increase consisted of positive organic sales of 31.7% and positive foreign currency translation of 3.2%. The increase was primarily driven by strong growth in general industry, pool pump, and Asia Pacific markets. Gross profit increased $40.3 million or 43.5% as compared to the six months ended June 27, 2020. The increase in gross profit was primarily driven by the increase in volume, partially offset by increased freight and material costs. Total operating expenses for the six months ended July 3, 2021 were $80.1 million compared to $74.4 million in the six months ended June 27, 2020. The $5.7 million or 7.7% increase was primarily due to foreign exchange losses, higher employee related wage and benefit costs, and increased engineering expenses.

Industrial Systems Segment net sales for the six months ended July 3, 2021 were $281.6 million, an increase of $31.4 million or 12.5% as compared to the six months ended June 27, 2020. The increase consisted of positive organic sales of 8.1% and positive foreign currency translation of 4.4%. The increase was primarily driven by strength in the generator business, strong growth in China and in India markets, and improving demand in the North America industrial motors business. Gross profit increased $5.1 million or 10.6% for the six months ended July 3, 2021 as compared to the six months ended June 27, 2020. The increase in gross profit was primarily driven by strong volumes, favorable mix and positive price realization, partially offset by material inflation. Total operating expenses for the six months ended July 3, 2021 and June 27, 2020 were $46.2 million and $44.8 million, respectively. The increase of 3.1% in operating expenses stems from higher variable selling costs on higher sales volumes and increased administrative costs quarter over quarter. The increase was partially offset by general cost savings initiatives and foreign exchange gains.

Climate Solutions Segment net sales were $496.4 million, an increase of $108.1 million or 27.8% as compared to the six months ended June 27, 2020. The increase consisted of positive organic sales of 27.5% and positive foreign currency translation of 0.3%. The increase was primarily due to continued strong demand in North American residential HVAC market and recovering demand in EMEA and Asia Pacific. Gross profit increased $41.2 million or 38.6% compared to the six months ended June 27, 2020. The increase in gross profit was primarily driven by volume, favorable product mix and 80/20 actions, partially offset by material inflation. Total operating expenses for the six months ended July 3, 2021 were $58.2 million compared to $57.3 million in the six months ended June 27, 2020. The increase was primarily due to 2020 cost savings as a result of non-recurring furloughs and increases in travel and other expenses, offset by gains in foreign currency.

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Power Transmission Solutions Segment net sales for the six months ended July 3, 2021 were $416.7 million, an increase of $62.2 million or 17.5% compared to six months ended June 27, 2020 net sales of $159.4 million. The increase consisted of positive organic sales of 15.9% and positive foreign currency of 1.6%. The increase was primarily driven by strength in the North American general industrial and alternative-energy end markets, prior year project wins in the aerospace end market, strength in the conveying business and recovering demand in EMEA. Gross profit for the six months ended July 3, 2021 increased $36.7 million or 29.1%. The increase was driven by higher sales volume, favorable product mix and lower overhead cost driven by cost reduction initiatives. Total operating expenses for the six months ended July 3, 2021 increased $25.1 million as compared to the six months ended June 27, 2020, primarily due to due diligence fees related to the Rexnord Transaction.

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	Three Months Ended						Six Months Ended
	July 3, 2021			June 27, 2020			July 3, 2021			June 27, 2020
(Dollars in Millions)
Net Sales:
Commercial Systems	$	269.3		$	175.9		$	506.3		$	375.3
Industrial Systems	145.2			120.6			281.6			250.2
Climate Solutions	257.3			178.2			496.4			388.3
Power Transmission Solutions	215.1			159.4			416.7			354.5
Consolidated	$	886.9		$	634.1		$	1,701.0		$	1,368.3
Gross Profit as a Percent of Net Sales:
Commercial Systems	25.1		%	24.1		%	26.3		%	24.7		%
Industrial Systems	18.0		%	20.6		%	18.8		%	19.1		%
Climate Solutions	28.8		%	26.6		%	29.8		%	27.5		%
Power Transmission Solutions	39.0		%	34.9		%	39.1		%	35.6		%
Consolidated	28.4		%	26.9		%	29.2		%	27.3		%
Operating Expenses as a Percent of Net Sales:
Commercial Systems	15.0		%	19.4		%	15.5		%	19.1		%
Industrial Systems	15.9		%	18.0		%	16.4		%	17.8		%
Climate Solutions	10.5		%	14.9		%	11.6		%	14.4		%
Power Transmission Solutions	23.2		%	24.5		%	25.5		%	22.9		%
Consolidated	15.8		%	19.2		%	17.0		%	18.5		%
Income from Operations as a Percent of Net Sales:
Commercial Systems	9.4		%	3.5		%	10.4		%	4.9		%
Industrial Systems	2.1		%	2.7		%	2.4		%	1.2		%
Climate Solutions	18.1		%	11.2		%	18.1		%	12.7		%
Power Transmission Solutions	15.8		%	10.4		%	13.6		%	12.7		%
Consolidated	12.3		%	7.2		%	12.1		%	8.5		%
Income from Operations	$	109.0		$	45.9		$	206.1		$	115.9
Other Income, Net	(1.2)			(1.1)			(2.4)			(2.2)
Interest Expense	11.5			10.6			24.1			22.2
Interest Income	(1.7)			(1.4)			(3.2)			(2.5)
Income before Taxes	100.4			37.8			187.6			98.4
Provision for Income Taxes	19.2			8.5			39.4			22.4
Net Income	81.2			29.3			148.2			76.0
Less: Net Income Attributable to Noncontrolling Interests	1.6			1.2			3.0			2.1
Net Income Attributable to Regal Beloit Corporation	$	79.6		$	28.1		$	145.2		$	73.9

    

The effective tax rate for the three months ended July 3, 2021 was 19.1% versus 22.5% for the three months ended June 27, 2020. The effective tax rate for the six months ended July 3, 2021 and June 27, 2020 was 21.0% and 22.8%, respectively. The change in the effective tax rate for the three and six months ended July 3, 2021 was primarily driven by the mix of earnings.

43

Liquidity and Capital Resources

General

Our principal source of liquidity is cash flow provided by operating activities. In addition to operating income, other significant factors affecting our cash flow include working capital levels, capital expenditures, dividends, share repurchases, acquisitions and divestitures, availability of debt financing and the ability to attract long-term capital at acceptable terms.

Cash flow provided by operating activities was $136.6 million for the six months ended July 3, 2021, a $53.0 million decrease from the six months ended June 27, 2020. The decrease is a result of increased accounts receivable, inventory and prepaid expenses and other current assets partially offset by higher accounts payable and net income in the current year for the six months ended July 3, 2021 compared to the six months ended June 27, 2020.

Cash flow used in investing activities was $26.3 million for the six months ended July 3, 2021 as compared to cash flow used in investing activities of $14.8 million for the six months ended June 27, 2020. The change was driven primarily by lower proceeds received from sales of property, plant and equipment and cash used for capital purchases and business acquisitions in the current year compared to the prior year.

Cash flow used in financing activities was $102.1 million for the six months ended July 3, 2021, compared to $66.8 million used in financing activities for the six months ended June 27, 2020. We had net debt repayments of $50.2 million during the six months ended July 3, 2021, compared to net debt repayments of $12.5 million during the six months ended June 27, 2020. There were no share repurchases for the six months ended July 3, 2021, compared to $25.0 million for the six months ended June 27, 2020. There were $17.0 million in financing fees paid for the six months ended July 3, 2021, compared to no fees in the prior year.

Our working capital was $1,145.4 million at July 3, 2021, compared to $1,029.3 million at January 2, 2021. At July 3, 2021 and January 2, 2021, our current ratio (which is the ratio of our current assets to current liabilities) was 2.2:1 and 2.3:1, respectively. Our working capital increased primarily due to the increase in trade receivables, inventory and prepaid expenses offset by an increase in accounts payable.

The following table presents selected financial information and statistics as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021		January 2, 2021
Cash and Cash Equivalents	$	618.5	$	611.3
Trade Receivables, Net	558.0		432.0
Inventories	759.2		690.3
Working Capital	1,145.4		1,029.3
Current Ratio	2.2:1		2.3:1

As of July 3, 2021, $543.7 million of our cash was held by foreign subsidiaries and could be used in our domestic operations if necessary. We anticipate being able to support our short-term liquidity and operating needs largely through cash generated from operations. We regularly assess our cash needs and the available sources to fund these needs which includes repatriation of foreign earnings which may be subject to withholding taxes. Under current law, we do not expect restrictions or taxes on repatriation of cash held outside of the United States to have a material effect on our overall liquidity, financial condition or the results of operations for the foreseeable future.

We will, from time to time, maintain excess cash balances which may be used to (i) fund operations, (ii) repay outstanding debt, (iii) fund acquisitions, (iv) pay dividends, (v) make investments in new product development programs, (vi) repurchase our common stock, or (vii) fund other corporate objectives.

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Credit Agreement

On March 17, 2021, we entered into an amendment (the "First Amendment") with our lenders to the Amended and Restated Credit Agreement, dated August 27, 2018 (the “Credit Agreement”) with JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders named therein. The First Amendment amended the Credit Agreement to, among other things, (i) permit the consummation of the proposed transaction pursuant to the definitive agreements we entered into on February 15, 2021, among Rexnord, Land and the Merger Sub with respect to a Reverse Morris Trust transaction (the "Rexnord Transaction") and the incurrence of indebtedness and liens in an aggregate principal amount not to exceed $2.1 billion (plus an additional $487.0 million of capacity for the DDTL Facility described below) in connection with the Rexnord Transaction; (ii) provide an increase in the aggregate principal amount of the revolving commitments under the Credit Agreement from $500.0 million to $750.0 million, (iii) provide an increase in the maximum leverage ratio (defined as, with certain adjustments, the ratio of our consolidated funded debt to EBITDA) permitted as of the last day of any fiscal quarter to 4.50 to 1.00, to the extent the funded debt to EBITDA ratio exceeds 3.00 to 1.00 upon the consummation of the Rexnord Transaction. The amendment is subject to customary and market provisions.

Prior to the First Amendment, the Credit Agreement provided for a (i) 5-year unsecured term loan facility in an original aggregate principal amount of $900.0 million (the “Term Facility”) and (ii) a 5-year unsecured multicurrency revolving facility in an aggregate principal amount of $500.0 million (increased as of the effectiveness of the First Amendment to $750.0 million) (the “Multicurrency Revolving Facility”), including a $50.0 million letter of credit sub facility, available for general corporate purposes. Borrowings under the Credit Agreement bear interest at floating rates based upon indices determined by the currency of the borrowing, plus an applicable margin determined by reference to our consolidated funded debt to consolidated EBITDA ratio or at an alternative base rate.

The Term Facility under the Credit Agreement was drawn in full on August 27, 2018 with the proceeds settling the amounts owed under prior borrowings. The Term Facility requires quarterly amortization at a rate starting at 5.0% per annum, increasing to 7.5% per annum after three years and further increasing to 10.0% per annum for the last year of the Term Facility, unless previously prepaid. The weighted average interest rate on the Term Facility for the three months ended July 3, 2021 and June 27, 2020 was 1.4% and 1.6%, respectively. The weighted average interest rate on the Term Facility for the six months ended July 3, 2021 and June 27, 2020 was 1.5% and 2.9%, respectively. The Credit Agreement requires that we prepay the loans under the Term Facility with 100% of the net cash proceeds received from specified asset sales and borrowed money indebtedness, subject to certain exceptions.

At July 3, 2021, we had no borrowings under the Multicurrency Revolving Facility, $0.2 million of standby letters of credit issued under the facility and $749.8 million of available borrowing capacity. For the three months ended July 3, 2021 and June 27, 2020 under the Multicurrency Revolving Facility, the average daily balance in borrowings was $2.4 million and $408.7 million, respectively and the weighted average interest rate was 1.4% and 1.9%, respectively. For the six months ended July 3, 2021 and June 27, 2020 under the Multicurrency Revolving Facility, the average daily balance in borrowings was $4.9 million and $258.8 million, respectively, and the weighted average interest rate was 1.4% and 2.4%, respectively. We pay a non-use fee on the aggregate unused amount of the Multicurrency Revolving Facility at a rate determined by reference to its consolidated funded debt to consolidated EBITDA ratio.

Senior Notes

At July 3, 2021, we had $400.0 million of senior notes (the “Notes”) outstanding. The Notes consist of $400.0 million in senior notes in a private placement which were issued in five tranches with maturities from ten to twelve years and carry fixed interest rates. As of July 3, 2021, $230.0 million and $170.0 million of the Notes are included in Current Maturities of Long-Term Debt and Long-Term Debt, respectively on the Condensed Consolidated Balance Sheets. The senior note that matured after quarter end on July 14, 2021, was paid via cash from operations and a draw on the Multicurrency Revolving Facility.

The following table presents details on the Notes at July 3, 2021 (in millions):

	Principal		Interest Rate	Maturity
Fixed Rate Series 2011A	$	230.0	4.8 to 5.0%	July 14, 2021
Fixed Rate Series 2011A	170.0		4.9 to 5.1%	July 14, 2023
	$	400.0

We have an interest rate swap agreement to manage fluctuations in cash flows resulting from interest rate risk (see also Note 14 of Notes to the Condensed Consolidated Financial Statements).

45

Compliance with Financial Covenants

The Credit Agreement and the Notes require us to meet specified financial ratios and to satisfy certain financial condition tests. We were in compliance with all financial covenants contained in the Notes and the Credit Agreement as of July 3, 2021.

Other Notes Payable

At July 3, 2021, other notes payable of approximately $4.3 million were outstanding with a weighted average interest rate of 4.9%. At January 2, 2021, other notes payable of approximately $4.6 million were outstanding with a weighted average rate of 4.9%.

Financing Arrangements Related to Rexnord Transaction

In connection with the Rexnord Transaction, on February 15, 2021, we entered into a debt commitment letter (the “Bridge Commitment Letter”) and related fee letters with Barclays Bank PLC (“Barclays”), pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide approximately $2.1 billion in an aggregate principal amount of senior bridge loans under a 364-day senior bridge loan credit facility (the “Bridge Facility”). The proceeds of the loans under the Bridge Facility may be used by us to (i) pay the Company Special Dividend, (ii) redeem the Notes due in 2023 and (iii) to pay fees and expenses in connection with the Rexnord Transaction.

Further, we entered into an additional debt commitment letter (the “Backstop Commitment Letter”) and related fee letters with Barclays, pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide 364-day senior bridge loan credit facility in an aggregate principal amount of up to approximately $1.1 billion to prepay in full the aggregate principal amount of loans outstanding under the Credit Agreement in the event that certain required consents from the lenders under the Credit Agreement could not be obtained. On March 17, 2021, as further described above, we entered into the First Amendment to, among other things (i) permit the consummation of the Rexnord Transaction, as applicable, (ii) permit the incurrence of indebtedness to finance the Company Special Dividend and to finance the cash payment of Land to a subsidiary of Rexnord (the "Land Cash Payment") as contemplated by the Rexnord Transaction; and (iii) provide an increase of $250.0 million in the aggregate principal amount of the revolving commitments under the Existing Credit Agreement, as described in detail above under "Credit Agreement". Upon the effectiveness of the First Amendment, the Backstop Commitment Letter and the commitments thereunder were terminated.

In connection with the Rexnord Transaction, Land also entered into a debt commitment letter (the “Land Commitment Letter”) and related fee letters with Barclays, pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide approximately $487.0 million of bridge loans under a 364-day senior bridge loan facility to be used to pay the Land Cash Payment. Pursuant to the terms of the Merger Agreement Land has entered into a permitted alternative financing to replace the commitments under the Land Commitment Letter. In particular, on May 14, 20201 Land entered into a Credit Agreement with JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders named therein, providing for a delayed draw term loan facility with commitments thereunder in an aggregate principal amount of $487.0 million, maturing in August 2023 (the “DDTL Facility”). Subject to satisfaction of the conditions therein, the DDTL Facility may be drawn in connection with the consummation of the Rexnord Transaction in order to fund the Land Cash Payment. The loans under the DDTL Facility will bear interest at floating rates, plus an applicable margin determined by reference to a consolidated funded debt to consolidated EBITDA ratio or at an alternative base rate. Upon the effectiveness of the DDTL Facility, the Land Commitment Letter and the commitments thereunder were terminated. If the Rexnord Transaction is consummated, the indebtedness contemplated by the Land Commitment Letter and DDTL Facility will become indebtedness of a wholly-owned subsidiary of the Company.

We anticipate incurring significant fees and expenses in connection with the Rexnord Transaction, the amount of which is uncertain. In addition, the amount of the Company Special Dividend depends on the number of additional shares of our common stock that must be issued in connection with the Rexnord Transaction in order to satisfy tax requirements applicable to a Reverse Morris Trust transaction. The size of the dividend that will ultimately be declared is uncertain and will remain so until the closing of the Rexnord Transaction.

Other Disclosures

Based on rates for instruments with comparable maturities and credit quality, which are classified as Level 2 inputs (see also Note 15 of Notes to the Condensed Consolidated Financial Statements), the approximate fair value of our total debt was $1,031.1 million and $1,085.8 million as of July 3, 2021 and January 2, 2021, respectively.

46

Critical Accounting Policies

Our disclosures of critical accounting policies, which are contained in our Annual Report on Form 10-K for the year ended January 2, 2021, have not materially changed since that report was filed.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk relating to our operations due to changes in interest rates, foreign currency exchange rates and commodity prices of purchased raw materials. We manage the exposure to these risks through a combination of normal operating and financing activities and derivative financial instruments such as interest rate swaps, commodity cash flow hedges and foreign currency forward exchange contracts. All hedging transactions are authorized and executed pursuant to clearly defined policies and procedures, which prohibit the use of financial instruments for speculative purposes.

Generally hedges are recorded on the balance sheet at fair value and are accounted for as cash flow hedges, with changes in fair value recorded in Accumulated Other comprehensive Income (Loss) (“AOCI”) in each accounting period. An ineffective portion of the hedges change in fair value, if any, is recorded in earnings in the period of change.

Interest Rate Risk

We are exposed to interest rate risk on certain of our outstanding debt obligations used to finance our operations and acquisitions. Loans under the Credit Agreement bear interest at variable rates plus a margin, based on our consolidated net leverage ratio. At July 3, 2021, excluding the impact of interest rate swaps, we had $403.8 million of fixed rate debt and $620.5 million of variable rate debt. We utilize interest rate swaps to manage fluctuations in cash flows resulting from exposure to interest rate risk on forecasted variable rate interest payments.

We have floating rate borrowings, which expose us to variability in interest payments due to changes in interest rates. A hypothetical 10% change in our weighted average borrowing rate on outstanding variable rate debt at July 3, 2021 would result in a $0.7 million change in after-tax annualized earnings. In April 2018, we entered into a spot, non-amortizing interest rate swap to pay fixed/receive floating with a notional amount of $88.4 million to manage fluctuations in cash flows from interest rate risk related to floating rate interest. The swap expired in April 2021 and was settled using cash from operations. We also entered into two forward starting pay fixed/receive floating non-amortizing interest rate swaps in June 2020, with a total notional amount of $250.0 million to manage fluctuations in cash flows from interest rate risk related to floating rate interest. These swaps became effective July 2021 and will expire in July 2025. Upon inception, the swaps were designated as a cash flow hedges against forecasted interest payments with gains and losses, net of tax, measured on an ongoing basis, recorded in AOCI.

Details regarding the instruments as of July 3, 2021 are as follows (in millions):

Instrument	Notional Amount	Maturity	Rate Paid	Rate Received	Fair Value
Swap	$250.0	July 2025	0.6%	LIBOR (1 month)	$	1.8

As of July 3, 2021, the interest rate swap asset was included in Other Noncurrent Assets. The unrealized gain on the effective portion of the contract net of tax of $1.4 million was recorded in AOCI. At January 2, 2021, a $(0.7) million interest rate swap liability was included in Other Accrued Expenses and $(1.4) million in Other Noncurrent Liabilities. There was an unrealized loss of $(1.6) million, net of tax, at January 2, 2021 that was recorded in AOCI for the effective portion of the hedge.

In July 2017, the United Kingdom Financial Conduct Authority (the authority that regulates LIBOR) announced it intends to stop persuading or compelling banks to submit rates for the calculation of LIBOR after 2021. We have material exposure to LIBOR through our revolving credit facility, certain lines of credit and interest rate swaps that are indexed to USD-LIBOR. It is expected that LIBOR will be discontinued and, while we believe an acceptable replacement to LIBOR will be available, if LIBOR is discontinued, we cannot reasonably estimate the impact, if any, on such discontinuation.

47

Foreign Currency Risk

We are exposed to foreign currency risks that arise from normal business operations. These risks include the translation of local currency balances of foreign subsidiaries, intercompany loans with foreign subsidiaries and transactions denominated in foreign currencies. Our objective is to minimize our exposure to these risks through a combination of normal operating activities and the utilization of foreign currency exchange contracts to manage our exposure on the forecasted transactions denominated in currencies other than the applicable functional currency. Contracts are executed with credit worthy banks and are denominated in currencies of major industrial countries. We do not hedge our exposure to the translation of reported results of foreign subsidiaries from local currency to United States dollars.

As of July 3, 2021, derivative currency assets (liabilities) of $13.6 million, $0.9 million, $(1.2) million and $(0.1) million, are recorded in Prepaid Expenses and Other Current Assets, Other Noncurrent Assets, Other Accrued Expenses, and Other Noncurrent Liabilities, respectively. As of January 2, 2021, derivative currency assets (liabilities) of $16.6 million, $1.6 million, $(1.0) million and $(0.1) million, are recorded in Prepaid Expenses and Other Current Assets, Other Noncurrent Assets, Other Accrued Expenses and Other Noncurrent Liabilities, respectively. The unrealized gains on the effective portions of the hedges of $10.2 million net of tax, and $12.7 million net of tax, as of July 3, 2021 and January 2, 2021 respectively, were recorded in AOCI. At July 3, 2021, we had $2.7 million, net of tax, of derivative currency gains on closed hedge instruments in AOCI that will be realized in earnings when the hedged items impact earnings. At January 2, 2021, we had $1.1 million, net of tax, currency gains on closed hedge instruments in AOCI that will be realized in earnings when the hedged items impact earnings.

The following table quantifies the outstanding foreign exchange contracts intended to hedge non-US dollar denominated receivables and payables and the corresponding impact on the value of these instruments assuming a hypothetical 10% appreciation/depreciation of their counter currency on July 3, 2021 (in millions):

					Gain (Loss) From
Currency	Notional Amount		Fair Value		10% Appreciation of Counter Currency		10% Depreciation of Counter Currency
Chinese Renminbi	$	146.1	$	2.7	$	14.6	$	(14.6)
Mexican Peso	194.1		10.7		19.4		(19.4)
Euro	141.7		(0.1)		14.2		(14.2)
Indian Rupee	49.5		0.4		5.0		(5.0)
Canadian Dollar	1.0		0.1		0.1		(0.1)
Australian Dollar	20.3		(0.1)		2.0		(2.0)
British Pound	10.8		—		1.1		(1.1)
Thai Baht	5.7		(0.5)		0.6		(0.6)

Gains and losses indicated in the sensitivity analysis would be offset by gains and losses on the underlying forecasted non-US dollar denominated cash flows.

Commodity Price Risk

We periodically enter into commodity hedging transactions to reduce the impact of changing prices for certain commodities such as copper and aluminum based upon forecasted purchases of such commodities. The contract terms of commodity hedge instruments generally mirror those of the hedged item, providing a high degree of risk reduction and correlation.

Derivative commodity assets (liabilities) of $16.7 million, $1.2 million, $(1.4) million, $(0.5) million were recorded in Prepaid Expenses and Other Current Assets, Other Noncurrent Assets, Other Accrued Expenses and Other Noncurrent Liabilities at July 3, 2021. Derivative commodity assets of $11.4 million and $0.1 million were recorded in Prepaid Expenses and Other Current Assets and Other Noncurrent Assets, respectively, at January 2, 2021. The unrealized gain on the effective portion of the hedges of $11.8 million net of tax and $8.7 million net of tax, as of July 3, 2021 and January 2, 2021, respectively, was recorded in AOCI. At July 3, 2021, we had $8.0 million, net of tax, of derivative commodity gains on closed hedge instruments in AOCI that will be realized in earnings when the hedged items impact earnings. At January 2, 2021, there was an additional $2.6 million, net of tax, of derivative commodity gain on closed hedge instruments in AOCI that were realized into earnings when the hedged items impacted earnings.

48

The following table quantifies the outstanding commodity contracts intended to hedge raw material commodity prices and the corresponding impact on the value of these instruments assuming a hypothetical 10% appreciation/depreciation of their prices on July 3, 2021 (in millions):

					Gain (Loss) From
Commodity	Notional Amount		Fair Value		10% Appreciation of Commodity Prices		10% Depreciation of Commodity Prices
Copper	$	135.5	$	14.6	$	13.6	$	(13.6)
Aluminum	8.0		1.4		0.8		(0.8)

Gains and losses indicated in the sensitivity analysis would be offset by the actual prices of the commodities.

The net AOCI hedging component balance of a $34.1 million gains at July 3, 2021 includes $20.9 million of net current deferred gains expected to be realized in the next twelve months. The gain/loss reclassified from AOCI into earnings on such derivatives will be recognized in the same period in which the related item affects earnings.

Counterparty Risk

We are exposed to credit losses in the event of non-performance by the counterparties to various financial agreements, including our interest rate swap agreements, foreign currency exchange contracts and commodity hedging transactions. We manage exposure to counterparty credit risk by limiting our counterparties to major international banks and financial institutions meeting established credit guidelines and continually monitoring their compliance with the credit guidelines. We do not obtain collateral or other security to support financial instruments subject to credit risk. We do not anticipate non-performance by our counterparties, but cannot provide assurances.

ITEM 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective to ensure that (a) information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission, and (b) information required to be disclosed by us in the reports the Company files or submits under the Exchange Act is accumulated and communicated to our management, including its Chief Executive Officer and its Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Internal Control Over Financial Reporting

There were no changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II—OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There have been no material changes in the legal matters described in Part I, Item 3 in our Annual Report on Form 10-K for the year ended January 2, 2021, which is incorporated herein by reference.

ITEM 1A. RISK FACTORS

Our business and financial results are subject to numerous risks and uncertainties. The risks and uncertainties have not changed materially from those reported in Part I, Item 1A in our 2020 Annual Report on Form 10-K for the year ended January 2, 2021, which is incorporated herein by reference. For additional information regarding risks and uncertainties facing the Company, please also see the information provided under the header “Cautionary Statement” contained in this Quarterly Report on Form 10-Q.

49

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

There were no repurchases of our common stock during the current quarter. 

Under our equity incentive plans, participants may pay the exercise price or satisfy all or a portion of the federal, state and local withholding tax obligations arising in connection with plan awards by electing to (a) have the Company withhold shares of common stock otherwise issuable under the award, (b) tender back shares received in connection with such award or (c) deliver other previously owned shares of common stock, in each case having a value equal to the exercise price or the amount to be withheld. During the quarter ended July 3, 2021, we did not acquire any shares in connection with transactions pursuant to equity incentive plans.

At a meeting of the Board of Directors on October 25, 2019, the Company's Board of Directors approved the authorization to purchase up to $250.0 million of shares.

50

ITEM 6. EXHIBITS

Exhibit Number	Exhibit Description
3.1	Amended and Restated Bylaws of Regal Beloit Corporation, as amended (incorporated by reference to Exhibit 4.2 to Amendment No. 1 to the Company's Registration Statement on Form S-4, filed with the SEC on May 10, 2021).
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certifications of the Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350.
101.INS	XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (formatted as iXBRL and contained in Exhibit 101).

51

SIGNATURE

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

	REGAL BELOIT CORPORATION (Registrant)
	/s/ Robert J. Rehard
	Robert J. Rehard Vice President Chief Financial Officer (Principal Financial Officer)
	/s/ Jason R. Longley
	Jason R. Longley Vice President Corporate Controller (Principal Accounting Officer)
Date: August 11, 2021

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EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Louis V. Pinkham, certify that:

1 I have reviewed this quarterly report on Form 10-Q of Regal Beloit Corporation;

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

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

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

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

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

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

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

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

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

(b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Louis V. Pinkham

Louis V. Pinkham
Chief Executive Officer

Date: August 11, 2021

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS

I, Robert J. Rehard, certify that:

1 I have reviewed this quarterly report on Form 10-Q of Regal Beloit Corporation;

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

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

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

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

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

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

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

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

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

(b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Robert J. Rehard

Robert J. Rehard
Vice President
Chief Financial Officer

Date: August 11, 2021

EX-32.1

EXHIBIT 32.1

CERTIFICATIONS of the

Chief Executive Officer and Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350

Solely for the purposes of complying with 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, we, the undersigned Chief Executive Officer and Chief Financial Officer of Regal Beloit Corporation (the “Company”), hereby certify, based on our knowledge, that the Quarterly Report on Form 10-Q of the Company for the three and six months ended July 3, 2021 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Louis V. Pinkham

Louis V. Pinkham

Chief Executive Officer

/s/ Robert J. Rehard

Robert J. Rehard

Vice President
Chief Financial Officer

Date: August 11, 2021

XML

Cover Page - shares	6 Months Ended
	Jul. 03, 2021	Aug. 02, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jul. 03, 2021
Document Transition Report	false
Entity File Number	001-07283
Entity Registrant Name	REGAL BELOIT CORP
Entity Incorporation, State or Country Code	WI
Entity Tax Identification Number	39-0875718
Entity Address, Address Line One	200 State Street
Entity Address, City or Town	Beloit
Entity Address, State or Province	WI
Entity Address, Postal Zip Code	53511
City Area Code	608
Local Phone Number	364-8800
Title of 12(b) Security	Common Stock
Trading Symbol	RBC
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		40,697,042
Entity Central Index Key	0000082811
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--01-01

XML

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Income Statement [Abstract]
Net Sales	$ 886.9	$ 634.1	$ 1,701.0	$ 1,368.3
Cost of Sales	635.4	463.8	1,204.1	994.7
Gross Profit	251.5	170.3	496.9	373.6
Operating Expenses	140.2	121.6	288.5	253.5
Gain on Divestiture of Businesses	0.0	0.0	0.0	(0.1)
Asset Impairments	2.3	2.8	2.3	4.3
Total Operating Expenses	142.5	124.4	290.8	257.7
Income from Operations	109.0	45.9	206.1	115.9
Other Income, Net	(1.2)	(1.1)	(2.4)	(2.2)
Interest Expense	11.5	10.6	24.1	22.2
Interest Income	(1.7)	(1.4)	(3.2)	(2.5)
Income before Taxes	100.4	37.8	187.6	98.4
Provision for Income Taxes	19.2	8.5	39.4	22.4
Net Income	81.2	29.3	148.2	76.0
Less: Net Income Attributable to Noncontrolling Interests	1.6	1.2	3.0	2.1
Net Income Attributable to Regal Beloit Corporation	$ 79.6	$ 28.1	$ 145.2	$ 73.9
Earnings Per Share Attributable to Regal Beloit Corporation:
Basic (in dollars per share)	$ 1.96	$ 0.69	$ 3.57	$ 1.82
Assuming Dilution (in dollars per share)	$ 1.94	$ 0.69	$ 3.54	$ 1.81
Weighted Average Number of Shares Outstanding:
Basic (in shares)	40.7	40.5	40.6	40.6
Assuming Dilution (in shares)	41.0	40.7	41.0	40.7

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Statement of Comprehensive Income [Abstract]
Net Income	$ 81.2	$ 29.3	$ 148.2	$ 76.0
Other Comprehensive Income (Loss) Net of Tax:
Foreign Currency Translation Adjustments	10.0	18.0	(11.7)	(39.5)
Hedging Activities:
Increase (Decrease) in Fair Value of Hedging Activities, Net of Tax Effects of $4.2 Million and $3.6 Million for the Three Months Ended July 3, 2021 and June 27, 2020 and $8.8 Million and $(5.8) Million for the Six Months Ended July 3, 2021 and June 27, 2020, Respectively	13.3	11.3	27.9	(18.3)
Reclassification of (Gains) Losses included in Net Income, Net of Tax Effects of $(2.7) Million and $0.5 Million for the Three Months Ended July 3, 2021 and June 27, 2020 and $(5.5) Million and $(0.1) Million for the Six Months Ended July 3, 2021 and June 27, 2020, Respectively	(8.6)	1.6	(17.3)	(0.4)
Pension and Post Retirement Plans:
Reclassification Adjustments for Pension and Post Retirement Benefits included in Net Income, Net of Tax Effects of $0.1 Million for the Three Months Ended July 3, 2021 and June 27, 2020 and $0.2 Million and $0.1 Million for the Six Months Ended July 3, 2021 and June 27, 2020, Respectively	0.4	0.1	0.7	0.2
Other Comprehensive Income (Loss)	15.1	31.0	(0.4)	(58.0)
Comprehensive Income	96.3	60.3	147.8	18.0
Less: Comprehensive Income (Loss) Attributable to Noncontrolling Interests	2.3	1.1	3.4	1.3
Comprehensive Income Attributable to Regal Beloit Corporation	$ 94.0	$ 59.2	$ 144.4	$ 16.7

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Statement of Comprehensive Income [Abstract]
Increase in fair value of hedging activities, tax effects	$ 4.2	$ 3.6	$ 8.8	$ (5.8)
Reclassification of losses (gains) included in net income, tax effects	(2.7)	0.5	(5.5)	(0.1)
Reclassification adjustments for pension and post retirement benefits included in net income, tax effects	$ 0.1	$ 0.1	$ 0.2	$ 0.1

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CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Jul. 03, 2021	Jan. 02, 2021
Current Assets:
Cash and Cash Equivalents	$ 618.5	$ 611.3
Trade Receivables, Less Allowances of $18.4 Million and $18.3 Million in 2021 and 2020, Respectively	558.0	432.0
Inventories	759.2	690.3
Prepaid Expenses and Other Current Assets	141.0	108.6
Assets Held for Sale	7.5	9.1
Total Current Assets	2,084.2	1,851.3
Net Property, Plant and Equipment	534.1	555.5
Operating Lease Assets	71.8	73.4
Goodwill	1,511.8	1,518.2
Intangible Assets, Net of Amortization	504.9	530.3
Deferred Income Tax Benefits	45.3	43.9
Other Noncurrent Assets	21.6	16.4
Total Assets	4,773.7	4,589.0
Current Liabilities:
Accounts Payable	461.4	360.1
Dividends Payable	13.4	12.2
Accrued Compensation and Employee Benefits	77.4	76.6
Other Accrued Expenses	133.7	120.5
Current Operating Lease Liabilities	22.0	21.6
Current Maturities of Long-Term Debt	230.9	231.0
Total Current Liabilities	938.8	822.0
Long-Term Debt	789.0	840.4
Deferred Income Taxes	175.3	172.0
Pension and Other Post Retirement Benefits	63.7	69.5
Noncurrent Operating Lease Liabilities	53.2	55.1
Other Noncurrent Liabilities	57.2	53.0
Contingencies (see Note 13)
Regal Beloit Corporation Shareholders' Equity:
Common Stock, $0.01 par value, 100.0 Million Shares Authorized, 40.7 Million and 40.6 Million Shares Issued and Outstanding for 2021 and 2020, Respectively	0.4	0.4
Additional Paid-In Capital	698.4	696.6
Retained Earnings	2,130.3	2,010.7
Accumulated Other Comprehensive Loss	(164.1)	(163.3)
Total Regal Beloit Corporation Shareholders' Equity	2,665.0	2,544.4
Noncontrolling Interests	31.5	32.6
Total Equity	2,696.5	2,577.0
Total Liabilities and Equity	$ 4,773.7	$ 4,589.0

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions	Jul. 03, 2021	Jan. 02, 2021
Statement of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 18.4	$ 18.3
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	100,000,000.0	100,000,000.0
Common stock, shares issued (in shares)	40,700,000	40,700,000
Common stock, shares outstanding (in shares)	40,600,000	40,600,000

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CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions	Total	Cumulative Effect, Period of Adoption, Adjustment	Common Stock $0.01 Par Value	Additional Paid-In Capital	Retained Earnings	Retained Earnings Cumulative Effect, Period of Adoption, Adjustment	Accumulated Other Comprehensive Income (Loss)	Noncontrolling Interests
Beginning Balance at Dec. 28, 2019	$ 2,380.4	$ (2.7)	$ 0.4	$ 701.8	$ 1,886.7	$ (2.7)	$ (237.8)	$ 29.3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	76.0				73.9			2.1
Other Comprehensive Income (Loss)	(58.0)						(57.2)	(0.8)
Dividends Declared	(24.3)				(24.3)
Stock Options Exercised	(2.2)			(2.2)
Stock Repurchase	(25.0)			(11.1)	(13.9)
Share-Based Compensation	5.5			5.5
Dividends Declared to Noncontrolling Interests	(2.7)							(2.7)
Ending Balance at Jun. 27, 2020	2,347.0		0.4	694.0	1,919.7		(295.0)	27.9
Beginning Balance at Mar. 28, 2020	2,300.1		0.4	692.5	1,903.8		(326.1)	29.5
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	29.3				28.1			1.2
Other Comprehensive Income (Loss)	31.0						31.1	(0.1)
Dividends Declared	(12.2)				(12.2)
Stock Options Exercised	(1.3)			(1.3)
Share-Based Compensation	2.8			2.8
Dividends Declared to Noncontrolling Interests	(2.7)							(2.7)
Ending Balance at Jun. 27, 2020	2,347.0		0.4	694.0	1,919.7		(295.0)	27.9
Beginning Balance at Jan. 02, 2021	2,577.0		0.4	696.6	2,010.7		(163.3)	32.6
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	148.2				145.2			3.0
Other Comprehensive Income (Loss)	(0.4)						(0.8)	0.4
Dividends Declared	(25.6)				(25.6)
Stock Options Exercised	(6.0)			(6.0)
Share-Based Compensation	7.8			7.8
Dividends Declared to Noncontrolling Interests	(4.5)							(4.5)
Ending Balance at Jul. 03, 2021	2,696.5		0.4	698.4	2,130.3		(164.1)	31.5
Beginning Balance at Apr. 03, 2021	2,617.8		0.4	698.1	2,064.1		(178.5)	33.7
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net Income	81.2				79.6			1.6
Other Comprehensive Income (Loss)	15.1						14.4	0.7
Dividends Declared	(13.4)				(13.4)
Stock Options Exercised	(4.2)			(4.2)
Share-Based Compensation	4.5			4.5
Dividends Declared to Noncontrolling Interests	(4.5)							(4.5)
Ending Balance at Jul. 03, 2021	$ 2,696.5		$ 0.4	$ 698.4	$ 2,130.3		$ (164.1)	$ 31.5

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CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Statement of Stockholders' Equity [Abstract]
Dividends declared, per share (in dollars per share)	$ 0.33	$ 0.30	$ 0.63	$ 0.60
Stockholders' equity, including portion attributable to noncontrolling interest	$ 2,696.5	$ 2,347.0	$ 2,696.5	$ 2,347.0

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$ 148.2	$ 76.0
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities (Net of Acquisitions and Divestitures):
Depreciation and Amortization	62.3	65.9
Asset Impairments	2.3	4.3
Noncash Lease Expense	12.4	14.8
Loss on Sale or Disposition of Assets, Net	0.5	1.4
Share-Based Compensation Expense	7.8	5.5
Financing Fees Amortization	8.6	0.7
Gain on Divestiture of Businesses	0.0	(0.1)
Change in Operating Assets and Liabilities	(105.5)	21.1
Net Cash Provided by Operating Activities	136.6	189.6
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to Property, Plant and Equipment	(24.3)	(20.4)
Proceeds Received from Sales of Property, Plant and Equipment	1.8	5.3
Business Acquisitions, Net of Cash Acquired	(3.8)	0.0
Proceeds from Divestiture of Businesses	0.0	0.3
Net Cash Used in Investing Activities	(26.3)	(14.8)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings Under Revolving Credit Facility	183.7	669.7
Repayments Under Revolving Credit Facility	(183.7)	(682.1)
Proceeds from Short-Term Borrowings	6.2	2.3
Repayments of Short-Term Borrowings	(6.2)	(2.3)
Proceeds from Long-Term Borrowings	0.0	0.1
Repayments of Long-Term Borrowings	(50.2)	(0.2)
Dividends Paid to Shareholders	(24.4)	(24.3)
Shares Surrendered for Taxes	(6.1)	(2.5)
Proceeds from the Exercise of Stock Options	0.1	0.2
Repurchase of Common Stock	0.0	(25.0)
Distributions to Noncontrolling Interests	(4.5)	(2.7)
Financing Fees Paid	(17.0)	0.0
Net Cash Used in Financing Activities	(102.1)	(66.8)
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS	(1.0)	(7.2)
Net Increase in Cash and Cash Equivalents	7.2	100.8
Cash and Cash Equivalents at Beginning of Period	611.3	331.4
Cash and Cash Equivalents at End of Period	618.5	432.2
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest	15.3	21.8
Income taxes	$ 46.3	$ 15.2

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BASIS OF PRESENTATION

6 Months Ended

Jul. 03, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

BASIS OF PRESENTATION

BASIS OF PRESENTATION

The accompanying (a) Condensed Consolidated Balance Sheet of Regal Beloit Corporation (the “Company”) as of January 2, 2021, which has been derived from audited Consolidated Financial Statements, and (b) unaudited interim Condensed Consolidated Financial Statements as of July 3, 2021 and for the three and six months ended July 3, 2021 and June 27, 2020, have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"), have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

It is suggested that these Condensed Consolidated Financial Statements be read in conjunction with the Consolidated Financial Statements and the Notes thereto included in the Company’s 2020 Annual Report on Form 10-K filed on March 2, 2021.

In the opinion of management, all adjustments considered necessary for a fair presentation of financial results have been made. Except as otherwise discussed, such adjustments consist of only those of a normal recurring nature. Operating results for the three and six months ended July 3, 2021 are not necessarily indicative of the results that may be expected for the entire fiscal year ending January 1, 2022.

The Condensed Consolidated Financial Statements have been prepared in accordance with GAAP, which requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the Condensed Consolidated Financial Statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. The Company uses estimates in accounting for, among other items, allowance for doubtful accounts; excess and obsolete inventory; share-based compensation; acquisitions; product warranty obligations; pension and post retirement assets and liabilities; derivative fair values; goodwill and other asset impairments; health care reserves; retirement benefits; rebates and incentives; litigation claims and contingencies, including environmental matters; and income taxes. The Company accounts for changes to estimates and assumptions when warranted by factually based experience.

The Company operates on a 52/53 week fiscal year ending on the Saturday closest to December 31.

Adopted Accounting Standards

In December 2019, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes. The ASU simplifies the accounting for income taxes by removing certain exceptions to the general principles of Topic 740, and clarifies and amends existing guidance to improve consistent application. This ASU becomes effective for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company adopted the standard as of January 3, 2021, the beginning of fiscal 2021, with no material impact on the Company's Condensed Consolidated Financial Statements.

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OTHER FINANCIAL INFORMATION

6 Months Ended

Jul. 03, 2021

Balance Sheet Related Disclosures [Abstract]

OTHER FINANCIAL INFORMATION

OTHER FINANCIAL INFORMATION

Inventories

The following table presents approximate percentage distribution between major classes of inventories:

	July 3, 2021	January 2, 2021
Raw Material and Work in Process	49.5%	48.7%
Finished Goods and Purchased Parts	50.5%	51.3%

Inventories are stated at cost, which is not in excess of market. Cost for approximately 48.1% of the Company's inventory at July 3, 2021, and 50.0% at January 2, 2021 was determined using the last-in, first-out ("LIFO") method.

Property, Plant, and Equipment

The following table presents property, plant, and equipment by major classification (dollars in millions):

	Useful Life in Years	July 3, 2021		January 2, 2021
Land and Improvements		$	74.9	$	76.1
Buildings and Improvements	3 - 50	288.4		290.7
Machinery and Equipment	3 - 15	979.3		978.2
Property, Plant and Equipment		1,342.6		1,345.0
Less: Accumulated Depreciation		(808.5)		(789.5)
Net Property, Plant and Equipment		$	534.1	$	555.5

For the three and six months ended July 3, 2021, the Company recognized $2.3 million of asset impairment related to the transfer of assets to held for sale. For the three and six months ended June 27, 2020, the Company recognized $2.8 million and $4.3 million, respectively, of asset impairments related to the transfer of assets to held for sale.

Revenue Recognition

The Company recognizes revenue from the sale of electric motors, electrical motion controls, power generation and power transmission products. The Company recognizes revenue when control of the product passes to the customer or the service is provided and is recognized at an amount that reflects the consideration expected to be received in exchange for such goods or services.

Nature of Goods and Services

The Company sells products with multiple applications as well as customized products that have a single application such as those manufactured for its OEM customers. The Company reports in four operating segments: Commercial Systems, Industrial Systems, Climate Solutions and Power Transmission Solutions. See Note 6 for a description of the different segments.

Nature of Performance Obligations

The Company’s contracts with customers typically consist of purchase orders, invoices and master supply agreements. At contract inception, across all four segments, the Company assesses the goods and services promised in its sales arrangements with customers and identifies a performance obligation for each promise to transfer to the customer a good or service that is distinct. The Company’s primary performance obligations consist of product sales and customized system/solutions.

Product:

The nature of products varies from segment to segment but across all segments, individual products are not integrated and represent separate performance obligations.

Customized system/solutions:

The Company provides customized system/solutions which consist of multiple products engineered and designed to specific customer specification, combined or integrated into one combined solution for a specific customer application. The goods are transferred to the customer and revenue is typically recognized over time as the performance obligations are satisfied.

When Performance Obligations are Satisfied

For performance obligations related to substantially all of the Company's product sales, the Company determines that the customer obtains control upon shipment and recognizes revenue accordingly. Once a product has shipped, the customer is able to direct the use of, and obtain substantially all of the remaining benefits from the asset. The Company considers control to have transferred upon shipment because the Company has a present right to payment at that time, the customer has legal title to the asset, the Company has transferred physical possession of the asset, and the customer has significant risks and rewards of ownership of the asset.

For a limited number of contracts, the Company transfers control and recognizes revenue over time. The Company satisfies its performance obligations over time and the Company uses a cost-based input method to measure progress. In applying the cost-based method of revenue recognition, the Company uses actual costs incurred to date relative to the total estimated costs for the contract in conjunction with the customer's commitment to perform in determining the amount of revenue and cost to recognize. The Company has determined that the cost-based input method provides a faithful depiction of the transfer of goods to the customer.

Payment Terms

The arrangement with the customer states the final terms of the sale, including the description, quantity, and price of each product or service purchased. Payment terms vary by customer but typically range from due upon delivery to 120 days after delivery. For contracts recognized at a point in time, revenue and billing typically occur simultaneously. The Company generally has payment terms with its customers of one year or less and has elected the practical expedient applicable to such contracts not to consider the time value of money. For contracts recognized using the cost-based input method, revenue recognized in excess of customer billings and billings in excess of revenue recognized are reviewed to determine the net asset or net liability position and classified as such on the Condensed Consolidated Balance Sheet.

Returns, Refunds, and Warranties

The Company’s contracts do not explicitly offer a “general” right of return to its customers (e.g., customers ordered excess products and return unused items). Warranties are classified as either assurance type or service type warranties. A warranty is considered an assurance type warranty if it provides the customer with assurance that the product will function as intended. A warranty that goes above and beyond ensuring basic functionality is considered a service type warranty. The Company generally only offers limited warranties which are considered to be assurance type warranties and are not accounted for as separate performance obligations. Customers generally receive repair or replacement on products that do not function to specification. Estimated product warranties are provided for specific product groups and the Company accrues for estimated future warranty cost in the period in which the sale is recognized. The Company estimates the accrual requirements based on historical warranty loss experience and the cost is included in Cost of Sales.

Volume Rebates

In some cases, the nature of the Company’s contract may give rise to variable consideration including volume based sales incentives. If the customer achieves specific sales targets, they are entitled to rebates. The Company estimates the projected amount of the rebates that will be achieved and recognizes the estimated costs as a reduction to Net Sales as revenue is recognized.

Disaggregation of Revenue

The following tables presents the Company’s revenues disaggregated by geographical region (in millions):

	Three Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	176.1	$	73.9	$	226.7	$	173.2	$	649.9
Asia	53.5		46.9		7.7		7.4		115.5
Europe	26.7		12.1		10.4		25.1		74.3
Rest-of-World	13.0		12.3		12.5		9.4		47.2
Total	$	269.3	$	145.2	$	257.3	$	215.1	$	886.9
June 27, 2020	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	112.5	$	69.2	$	158.8	$	123.2	$	463.7
Asia	28.9		36.6		1.0		7.5		74.0
Europe	25.5		14.7		7.5		22.2		69.9
Rest-of-World	9.0		0.1		10.9		6.5		26.5
Total	$	175.9	$	120.6	$	178.2	$	159.4	$	634.1

	Six Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	330.2	$	145.0	$	436.4	$	337.0	$	1,248.6
Asia	99.5		90.1		17.0		14.3		220.9
Europe	51.4		23.7		19.9		48.6		143.6
Rest-of-World	25.2		22.8		23.1		16.8		87.9
Total	$	506.3	$	281.6	$	496.4	$	416.7	$	1,701.0
June 27, 2020	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	255.9	$	142.1	$	343.4	$	284.1	$	1,025.5
Asia	52.3		73.4		9.6		12.4		147.7
Europe	54.0		27.9		15.1		46.1		143.1
Rest-of-World	13.1		6.8		20.2		11.9		52.0
Total	$	375.3	$	250.2	$	388.3	$	354.5	$	1,368.3

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HELD FOR SALE, DIVESTITURES AND ACQUISITIONS

6 Months Ended

Jul. 03, 2021

Business Combination and Asset Acquisition [Abstract]

HELD FOR SALE, DIVESTITURES AND ACQUISITIONS

HELD FOR SALE, DIVESTITURES AND ACQUISITIONS

Assets Held for Sale

The balances that were classified as Assets Held for Sale as of July 3, 2021 and January 2, 2021 were $7.5 million and $9.1 million, respectively.

Acquisition Pending

On February 15, 2021, the Company entered into definitive agreements with Rexnord Corporation (“Rexnord”), Land Newco, Inc., a wholly owned indirect subsidiary of Rexnord (“Land”), and Phoenix 2021, Inc., a wholly owned subsidiary of the Company (“Merger Sub”), with respect to a Reverse Morris Trust transaction (the “Rexnord Transaction”) pursuant to which, and subject to the terms and conditions of those definitive agreements discussed below, (1) Rexnord will transfer (or cause to be transferred) to Land substantially all of the assets, and Land will assume substantially all of the liabilities, of Rexnord’s Process & Motion Control business (“PMC Business”) (the “Reorganization”), (2) after which, all of the issued and outstanding shares of common stock, $0.01 par value per share, of Land (“Land common stock”) held by a subsidiary of Rexnord will be distributed in a series of distributions to Rexnord’s stockholders (the distributions, and the final distribution of Land common stock from Rexnord to Rexnord’s stockholders, which is to be made pro rata for no consideration, the “Spin-Off”) and (3) immediately after the Spin-Off, Merger Sub will merge with and into Land (the “Merger”) and all shares of Land common stock (other than those held by Rexnord, Land, the Company, Merger Sub or their respective subsidiaries) will be converted into the right to receive shares of our common stock, $0.01 par value per share (“Company common stock”), as calculated and subject to adjustment as set forth in the Merger Agreement (as defined below). When the Merger is completed, Land (which at that time will hold the PMC Business) will be a wholly owned subsidiary of the Company.

The definitive agreements the Company entered into in connection with the Rexnord Transaction include an Agreement and Plan of Merger, by and among Rexnord, Land, Merger Sub and the Company (the “Merger Agreement”), a Separation and Distribution Agreement, by and among Rexnord, Land and the Company and certain ancillary agreements.

In connection with the Rexnord Transaction, the Merger Agreement provides that the Company shall, to the extent required by the Merger Agreement, in certain circumstances in which additional shares of Company common stock are issued at closing to holders of Land common stock, declare a special dividend to the Company's stockholders immediately prior to the consummation of the Merger (the “Company Special Dividend”). The existence and magnitude of the dividend will depend on whether and to what extent the Company is able to count certain overlapping shareholders of the Company and Rexnord in satisfying the tax requirements applicable to a Reverse Morris Trust transaction. In the event that the Company Special Dividend is required to be paid, it could range in amount between zero and approximately $2.0 billion.

In connection with the Rexnord Transaction, the Company has entered into certain financing arrangements, which are described in Note 7.

Closing of the Rexnord Transaction is subject to various closing conditions, including the receipt of the approval of the Company's and Rexnord's shareholders and other customary closing conditions.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

6 Months Ended

Jul. 03, 2021

Equity [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Foreign currency translation adjustments, hedging activities and pension and post retirement benefit adjustments are included in Accumulated Other Comprehensive Income (Loss) ("AOCI") a component of Total Equity.

The following tables present changes in AOCI by component for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended
July 3, 2021	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	29.4	$	(30.8)	$	(177.1)	$	(178.5)
Other Comprehensive Income before Reclassifications	17.5		—		9.3		26.8
Tax Impact	(4.2)		—		—		(4.2)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(11.3)		0.5		—		(10.8)
Tax Impact	2.7		(0.1)		—		2.6
Net Current Period Other Comprehensive Income	4.7		0.4		9.3		14.4
Ending Balance	$	34.1	$	(30.4)	$	(167.8)	$	(164.1)
June 27, 2020	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	(23.6)	$	(30.5)	$	(272.0)	$	(326.1)
Other Comprehensive Income (Loss) before Reclassifications	14.9		(0.1)		18.2		33.0
Tax Impact	(3.6)		—		—		(3.6)
Amounts Reclassified from Accumulated Other Comprehensive Income	2.1		0.2		—		2.3
Tax Impact	(0.5)		(0.1)		—		(0.6)
Net Current Period Other Comprehensive Income	12.9		—		18.2		31.1
Ending Balance	$	(10.7)	$	(30.5)	$	(253.8)	$	(295.0)

	Six Months Ended
	July 3, 2021
	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	23.5	$	(31.1)	$	(155.7)	$	(163.3)
Other Comprehensive Income (Loss) before Reclassifications	36.7		—		(12.1)		24.6
Tax Impact	(8.8)		—		—		(8.8)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(22.8)		0.9		—		(21.9)
Tax Impact	5.5		(0.2)		—		5.3
Net Current Period Other Comprehensive Income (Loss)	10.6		0.7		(12.1)		(0.8)
Ending Balance	$	34.1	$	(30.4)	$	(167.8)	$	(164.1)
	Six Months Ended
	June 27, 2020
	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning balance	$	8.0	$	(31.0)	$	(214.8)	$	(237.8)
Other Comprehensive Income (Loss) before Reclassifications	(24.1)		0.3		(39.0)		(62.8)
Tax Impact	5.8		—		—		5.8
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(0.5)		0.3		—		(0.2)
Tax Impact	0.1		(0.1)		—		—
Net Current Period Other Comprehensive Income (Loss)	(18.7)		0.5		(39.0)		(57.2)
Ending Balance	$	(10.7)	$	(30.5)	$	(253.8)	$	(295.0)

The Condensed Consolidated Statements of Income line items affected by the hedging activities reclassified from AOCI in the tables above are disclosed in Note 14.

The reclassification amounts for pension and post retirement benefit adjustments in the tables above are part of net periodic benefit costs recorded in Other Income, Net (see also Note 8).

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GOODWILL AND INTANGIBLE ASSETS

6 Months Ended

Jul. 03, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS

Goodwill

As required, the Company performs an annual impairment test of goodwill as of the end of the October fiscal month or more frequently if events or circumstances change that would more likely than not reduce the fair value of its reporting units below their carrying value.

The following table presents changes to goodwill during the six months ended July 3, 2021 (in millions):

	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
Balance as of January 2, 2021	$	1,518.2	$	433.3	$	163.7	$	330.8	$	590.4
Translation Adjustments	(6.4)		(1.5)		(0.7)		(0.2)		(4.0)
Balance as of July 3, 2021	$	1,511.8	$	431.8	$	163.0	$	330.6	$	586.4
Cumulative Goodwill Impairment Charges	$	295.7	$	183.2	$	72.1	$	17.2	$	23.2

Intangible Assets

The following table presents intangible assets (in millions):

		July 3, 2021				January 2, 2021
	Weighted Average Amortization Period (Years)	Gross Value		Accumulated Amortization		Gross Value		Accumulated Amortization
Amortizable Intangible Assets:
Customer Relationships	17	$	704.1	$	366.1	$	708.6	$	349.4
Technology	14	145.9		110.0		146.3		108.0
Trademarks	14	37.0		28.4		37.7		27.7
		887.0		504.5		892.6		485.1
Non-Amortizable Trade Name		122.4		—		122.8		—
		$	1,009.4	$	504.5	$	1,015.4	$	485.1
Intangible Assets, Net of Amortization		$	504.9			$	530.3

Amortization expense recorded for the three and six months ended July 3, 2021 was $11.1 million and $22.3 million, respectively. Amortization expense recorded for the three and six months ended June 27, 2020 was $12.2 million and $24.4 million, respectively. Amortization expense for fiscal year 2021 is estimated to be $43.3 million. There were no intangible asset impairments during the three and six months ended July 3, 2021 and June 27, 2020, respectively.

The following table presents future estimated annual amortization for intangible assets (in millions):

Year	Estimated Amortization
2022	$	41.5
2023	41.5
2024	40.9
2025	38.8
2026	35.3

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SEGMENT INFORMATION

6 Months Ended

Jul. 03, 2021

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATIONThe Company is comprised of four operating segments: Commercial Systems, Industrial Systems, Climate Solutions and Power Transmission Solutions.

Commercial Systems segment produces fractional to approximately 5 horsepower AC and DC motors, electronic variable speed controls, fans, and blowers for commercial applications. These products serve markets including commercial building ventilation and HVAC, pool and spa, irrigation, dewatering, agriculture, and general commercial equipment.

Industrial Systems segment produces integral motors, generators, alternators and switchgear for industrial applications, along with aftermarket parts and kits to support such products. These products serve markets including agriculture, marine, mining, oil and gas, food and beverage, data centers, healthcare, prime and standby power, and general industrial equipment.

Climate Solutions segment produces small motors, electronic variable speed controls and air moving solutions serving markets including residential and light commercial HVAC, water heaters and commercial refrigeration.

Power Transmission Solutions segment produces, sells and services belt and chain drives, helical and worm gearing, mounted and unmounted bearings, couplings, modular plastic belts, conveying chains and components, hydraulic pump drives, large open gearing and specialty mechanical products serving markets including e-commerce, alternative energy, beverage, bulk handling, metals, special machinery, energy, aerospace and general industrial.

The Company evaluates performance based on the segment's income from operations. Corporate costs have been allocated to each segment based on the net sales of each segment. The reported external net sales of each segment are from external customers.

The following sets forth certain financial information attributable to the Company's operating segments for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Eliminations		Total
External Sales	$	269.3	$	145.2	$	257.3	$	215.1	$	—	$	886.9
Intersegment Sales	19.9		7.3		5.1		0.8		(33.1)		—
Total Sales	289.2		152.5		262.4		215.9		(33.1)		886.9
Gross Profit	67.5		26.2		74.0		83.8		—		251.5
Operating Expenses	40.3		23.1		27.0		49.8		—		140.2
Asset Impairments	1.8		—		0.5		—		—		2.3
Total Operating Expenses	42.1		23.1		27.5		49.8		—		142.5
Income from Operations	25.4		3.1		46.5		34.0		—		109.0
Depreciation and Amortization	7.8		5.7		3.6		13.4		—		30.5
Capital Expenditures	4.5		3.3		3.0		2.8		—		13.6
June 27, 2020
External Sales	$	175.9	$	120.6	$	178.2	$	159.4	$	—	$	634.1
Intersegment Sales	16.9		9.1		3.9		0.6		(30.5)		—
Total Sales	192.8		129.7		182.1		160.0		(30.5)		634.1
Gross Profit	42.4		24.9		47.4		55.6		—		170.3
Operating Expenses	34.2		21.7		26.6		39.1		—		121.6
Asset Impairments	2.0		—		0.8		—		—		2.8
Total Operating Expenses	36.2		21.7		27.4		39.1		—		124.4
Income from Operations	6.2		3.2		20.0		16.5		—		45.9
Depreciation and Amortization	8.3		6.0		5.0		14.0		—		33.3
Capital Expenditures	2.2		2.3		2.6		2.4		—		9.5

	Six Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Eliminations		Total
External Sales	$	506.3	$	281.6	$	496.4	$	416.7	$	—	$	1,701.0
Intersegment Sales	37.4		11.0		9.4		1.5		(59.3)		—
Total Sales	543.7		292.6		505.8		418.2		(59.3)		1,701.0
Gross Profit	133.0		53.0		148.0		162.9		—		496.9
Operating Expenses	78.3		46.2		57.7		106.3		—		288.5
Asset Impairments	1.8		—		0.5		—		—		2.3
Total Operating Expenses	80.1		46.2		58.2		106.3		—		290.8
Income from Operations	52.9		6.8		89.8		56.6		—		206.1
Depreciation and Amortization	15.6		11.6		8.1		27.0		—		62.3
Capital Expenditures	7.8		5.7		6.2		4.6		—		24.3
June 27, 2020
External Sales	$	375.3	$	250.2	$	388.3	$	354.5	$	—	$	1,368.3
Intersegment Sales	28.7		15.8		8.4		1.3		(54.2)		—
Total Sales	404.0		266.0		396.7		355.8		(54.2)		1,368.3
Gross Profit	92.7		47.9		106.8		126.2		—		373.6
Operating Expenses	71.7		44.6		56.0		81.2		—		253.5
Gain on Divestiture of Businesses	(0.1)		—		—		—		—		(0.1)
Asset Impairments	2.8		0.2		1.3		—		—		4.3
Total Operating Expenses	74.4		44.8		57.3		81.2		—		257.7
Income from Operations	18.3		3.1		49.5		45.0		—		115.9
Depreciation and Amortization	16.6		11.9		9.7		27.7		—		65.9
Capital Expenditures	5.3		4.3		6.2		4.6		—		20.4

The following table presents identifiable assets information attributable to the Company's operating segments as of July 3, 2021 and January 2, 2021 (in millions):

	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
Identifiable Assets as of July 3, 2021	$	1,390.5	$	870.2	$	966.1	$	1,546.9	$	4,773.7
Identifiable Assets as of January 2, 2021	1,319.6		837.5		890.4		1,541.5		4,589.0

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DEBT AND BANK CREDIT FACILITIES

6 Months Ended

Jul. 03, 2021

Debt Disclosure [Abstract]

DEBT AND BANK CREDIT FACILITIES

DEBT AND BANK CREDIT FACILITIES

The following table presents the Company’s indebtedness as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021		January 2, 2021
Term Facility	$	620.0	$	670.0
Senior Notes	400.0		400.0
Other	4.3		4.6
Less: Debt Issuance Costs	(4.4)		(3.2)
Total	1,019.9		1,071.4
Less: Current Maturities	230.9		231.0
Long-Term Debt	$	789.0	$	840.4

Credit Agreement

On March 17, 2021, the Company entered into an amendment (the "First Amendment") with the Company's lenders to the Amended and Restated Credit Agreement, dated August 27, 2018 (the “Credit Agreement”) with JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders named therein. The First Amendment amended the Credit Agreement to, among other things, (i) permit the consummation of the Rexnord Transaction and the incurrence of indebtedness and liens in an aggregate principal amount not to exceed $2.1 billion (plus an additional $487.0 million of capacity for the DDTL Facility described below) in connection with the Rexnord Transaction; (ii) provide an increase in the aggregate principal amount of the revolving commitments under the Credit Agreement from $500.0 million to $750.0 million, (iii) provide an increase in the maximum leverage ratio (defined as, with certain adjustments, the ratio of the Company’s consolidated funded debt to EBITDA) permitted as of the last day of any fiscal quarter to 4.50 to 1.00, to the extent the funded debt to EBITDA ratio exceeds 3.00 to 1.00 upon the consummation of the Rexnord Transaction. The amendment is subject to customary and market provisions.

Prior to the First Amendment, the Credit Agreement provided for a (i) 5-year unsecured term loan facility in an original aggregate principal amount of $900.0 million (the “Term Facility”) and (ii) a 5-year unsecured multicurrency revolving facility in an aggregate principal amount of $500.0 million (increased as of the effectiveness of the First Amendment to $750.0 million) (the “Multicurrency Revolving Facility”), including a $50.0 million letter of credit sub facility, available for general corporate purposes. Borrowings under the Credit Agreement bear interest at floating rates based upon indices determined by the currency of the borrowing, plus an applicable margin determined by reference to the Company's consolidated funded debt to consolidated EBITDA ratio or at an alternative base rate.

The Term Facility under the Credit Agreement was drawn in full on August 27, 2018 with the proceeds settling the amounts owed under prior borrowings. The Term Facility requires quarterly amortization at a rate starting at 5.0% per annum, increasing to 7.5% per annum after three years and further increasing to 10.0% per annum for the last year of the Term Facility, unless previously prepaid. The weighted average interest rate on the Term Facility for the three months ended July 3, 2021 and June 27, 2020 was 1.4% and 1.6%, respectively. The weighted average interest rate on the Term Facility for the six months ended July 3, 2021 and June 27, 2020 was 1.5% and 2.9%, respectively. The Credit Agreement requires that the Company prepay the loans under the Term Facility with 100% of the net cash proceeds received from specified asset sales and borrowed money indebtedness, subject to certain exceptions.

At July 3, 2021, the Company had no borrowings under the Multicurrency Revolving Facility, $0.2 million of standby letters of credit issued under the facility, and $749.8 million of available borrowing capacity. For the three months ended July 3, 2021 and June 27, 2020 under the Multicurrency Revolving Facility, the average daily balance in borrowings was $2.4 million and $408.7 million, respectively, and the weighted average interest rate was 1.4% and 1.9%, respectively. For the six months ended July 3, 2021 and June 27, 2020 under the Multicurrency Revolving Facility, the average daily balance in borrowings was $4.9 million and $258.8 million, respectively, and the weighted average interest rate was 1.4% and 2.4%, respectively. The Company pays a non-use fee on the aggregate unused amount of the Multicurrency Revolving Facility at a rate determined by reference to its consolidated funded debt to consolidated EBITDA ratio.

Senior Notes

At July 3, 2021, the Company had $400.0 million of senior notes (the “Notes”) outstanding. The Notes consist of $400.0 million in senior notes in a private placement which were issued in five tranches with maturities from ten to twelve years and carry fixed interest rates. As of July 3, 2021, $230.0 million and $170.0 million of the Notes are included in Current Maturities of Long-Term Debt and Long-Term Debt, respectively, on the Condensed Consolidated Balance Sheets.

The following table presents details on the Notes at July 3, 2021 (in millions):

	Principal		Interest Rate	Maturity
Fixed Rate Series 2011A	$	230.0	4.8 to 5.0%	July 14, 2021
Fixed Rate Series 2011A	170.0		4.9 to 5.1%	July 14, 2023
	$	400.0

The senior note that matured after quarter end on July 14, 2021, was paid via cash from operations and a draw on the Multicurrency Revolving Facility.

Compliance with Financial Covenants

The Credit Agreement and the Notes require the Company to meet specified financial ratios and to satisfy certain financial condition tests. The Company was in compliance with all financial covenants contained in the Notes and the Credit Agreement as of July 3, 2021.

Other Notes Payable

At July 3, 2021, other notes payable of approximately $4.3 million were outstanding with a weighted average interest rate of 4.9%. At January 2, 2021, other notes payable of approximately $4.6 million were outstanding with a weighted average rate of 4.9%.

Financing Arrangements Related to Rexnord Transaction

In connection with the Rexnord Transaction, on February 15, 2021, the Company entered into a debt commitment letter (the “Bridge Commitment Letter”) and related fee letters with Barclays Bank PLC (“Barclays”), pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide approximately $2.1 billion in an aggregate principal amount of senior bridge loans under a 364-day senior bridge loan credit facility (the “Bridge Facility”). The proceeds of the loans under the Bridge Facility may be used by the Company to (i) pay the Company Special Dividend, (ii) redeem the Notes due in 2023 and (iii) to pay fees and expenses in connection with the Rexnord Transaction.

Further, the Company entered into an additional debt commitment letter (the “Backstop Commitment Letter”) and related fee letters with Barclays, pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide a 364-day senior bridge loan credit facility in an aggregate principal amount of up to approximately $1.1 billion to prepay in full the aggregate principal amount of loans outstanding under the Credit Agreement in the event that certain required consents from the lenders under the Credit Agreement could not be obtained. On March 17, 2021, as further described above, the Company entered into the First Amendment to, among other things (i) permit the consummation of the Rexnord Transaction, as applicable, (ii) permit the incurrence of indebtedness to finance the Company Special Dividend and to finance the cash payment of Land to a subsidiary of Rexnord (the "Land Cash Payment") as contemplated by the Rexnord Transaction; and (iii) provide an increase of $250.0 million in the aggregate principal amount of the revolving commitments under the Existing Credit Agreement, as described in detail above under "Credit Agreement". Upon the effectiveness of the First Amendment, the Backstop Commitment Letter and the commitments thereunder were terminated.

In connection with the Rexnord Transaction, Land also entered into a debt commitment letter (the “Land Commitment Letter”) and related fee letters with Barclays, pursuant to which, and subject to the terms and conditions set forth therein, Barclays committed to provide approximately $487.0 million of bridge loans under a 364-day senior bridge loan facility to be used to pay the Land Cash Payment. Pursuant to the terms of the Merger Agreement, Land has entered into a permitted alternative financing to replace the commitments under the Land Commitment Letter. In particular, on May 14, 2021, Land entered into a Credit Agreement with JPMorgan Chase Bank, N.A., as Administrative Agent and the lenders named therein, providing for a delayed draw term loan facility with commitments thereunder in an aggregate principal amount of $487.0 million, maturing in August 2023 (the "DDTL Facility"). Subject to satisfaction of the conditions therein, the DDTL Facility may be drawn in connection with the consummation of the Rexnord Transaction in order to fund the Land Cash Payment. The loans under the DDTL Facility will bear interest at floating rates, plus an applicable margin determined by reference to a consolidated funded debt to consolidated EBITDA ratio or at an alternative base rate. Upon the effectiveness of the DDTL Facility, the Land Commitment Letter and the commitments thereunder were terminated. If the Rexnord Transaction is consummated, the indebtedness contemplated by the Land Commitment Letter and DDTL Facility will become indebtedness of a wholly-owned subsidiary of the Company.

The Company anticipates incurring significant fees and expenses in connection with the Rexnord Transaction, the amount of which is uncertain. In addition, the amount of the Company Special Dividend depends on the number of additional shares of the Company's common stock that must be issued in connection with the Rexnord Transaction in order to satisfy tax requirements applicable to a Reverse Morris Trust transaction. The size of the dividend that will ultimately be declared is uncertain and will remain so until the closing of the Rexnord Transaction.

Other Disclosures

Based on rates for instruments with comparable maturities and credit quality, which are classified as Level 2 inputs (see also Note 15), the approximate fair value of the Company's total debt was $1,031.1 million and $1,085.8 million as of July 3, 2021 and January 2, 2021, respectively.

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RETIREMENT AND POST RETIREMENT HEALTH CARE PLANS

6 Months Ended

Jul. 03, 2021

Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract]

RETIREMENT AND POST RETIREMENT HEALTH CARE PLANS

RETIREMENT AND POST RETIREMENT HEALTH CARE PLANS

The following table presents the Company’s net periodic benefit cost (income) components (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Service Cost	$	0.3	$	0.3	$	0.6	$	1.1
Interest Cost	1.4		2.0		2.9		4.1
Expected Return on Plan Assets	(3.1)		(3.3)		(6.2)		(6.6)
Amortization of Prior Service Cost and Net Actuarial Loss	0.5		0.2		0.9		0.3
Net Periodic Benefit Income	$	(0.9)	$	(0.8)	$	(1.8)	$	(1.1)

The service cost component is included in Cost of Sales and Operating Expenses. All other components of net periodic benefit costs are included in Other Income, Net on the Company's Condensed Consolidated Statements of Income.

For the three months ended July 3, 2021 and June 27, 2020, the Company contributed $1.6 million and $1.2 million, respectively, to post retirement plans. For the six months ended July 3, 2021 and June 27, 2020, the Company contributed $2.8 million and $2.3 million, respectively. The Company expects to make total contributions of $5.8 million in 2021. The Company contributed a total of $8.5 million in fiscal 2020.

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LEASES

6 Months Ended

Jul. 03, 2021

Leases [Abstract]

Leases

LEASES

The Company leases certain manufacturing facilities, warehouses/distribution centers, office space, machinery, equipment, IT assets, and vehicles. If the contract provides the Company the right to substantially all of the economic benefits from the use of the identified asset and the right to direct the use of the identified asset, it is considered to be or contain a lease. Right-of-use ("ROU") assets and lease liabilities are recognized at lease commencement date based on the present value of the future lease payments over the expected lease term.

As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The incremental borrowing rate is calculated based upon the sovereign treasury rate for the currency in which the lease liability is denominated when the Company takes possession of the leased asset, adjusted for various factors, such as term and internal credit spread. The ROU asset also includes any lease payments made and excludes lease incentive and initial direct costs incurred.

Leases entered into may include one or more options to renew. The renewal terms can extend the lease term from one to twenty-five years. The exercise of lease renewal options is at the Company's sole discretion. Renewal option periods are included in the measurement of the ROU asset and lease liability when the exercise is reasonably certain to occur. Some leases include options to terminate the lease upon breach of contract and are remeasured at that point in time.

The depreciable life of leased assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

Some of the Company's lease agreements include rental payments adjusted periodically for inflation or are based on an index rate. These increases are reflected as variable lease payments and are included in the measurement of the ROU asset and lease liability. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Operating leases are included in the following asset and liability accounts on the Company's Condensed Consolidated Balance Sheet: Operating Lease Assets, Current Operating Lease Liabilities, and Noncurrent Operating Lease Liabilities. ROU assets and liabilities arising from finance leases are included in the following asset and liability accounts on the Company's Condensed Consolidated Balance Sheet: Net Property, Plant and Equipment, Current Maturities of Long-Term Debt, and Long-Term Debt.

Short-term and variable lease expenses were immaterial. The components of lease expense were as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Operating Lease Cost	$	7.7	$	7.6	$	15.4	$	15.3
Finance Lease Cost:
Amortization of ROU Assets	0.1		0.1		0.2		0.2
Interest on Lease Liabilities	0.1		—		0.1		0.1
Total Lease Expense	$	7.9	7.7		$	15.7	$	15.6

Maturity of lease liabilities as of July 3, 2021 were as follows (in millions):

	Operating Leases		Finance Leases		Total
Remainder of 2021	$	14.3	$	0.3	$	14.6
2022	22.4		0.5		22.9
2023	15.6		0.6		16.2
2024	10.6		0.6		11.2
2025	8.0		0.6		8.6
Thereafter	18.7		1.3		20.0
Total Lease Payments	$	89.6	$	3.9	$	93.5
Less: Interest	(14.4)		(0.7)		(15.1)
Present Value of Lease Liabilities	$	75.2	$	3.2	$	78.4

Other information related to leases was as follows (in millions):

	Six Months Ended
Supplemental Cash Flows Information	July 3, 2021			June 27, 2020
Cash Paid for Amounts Included in the Measurement of Lease Liabilities:
Operating Cash Flows Used For Operating Leases	$	12.4		$	14.8
Operating Cash Flows Used For Finance Leases	0.1			0.1
Financing Cash Flows Used For Finance Leases	0.2			0.2
Leased Assets Obtained in Exchange for New Operating Lease Liabilities	9.7			18.3
Weighted Average Remaining Lease Term
Operating Leases	4.4 years			5.2 years
Finance Leases	6.8 years			7.8 years
Weighted Average Discount Rate
Operating Leases	6.7		%	8.3		%
Finance Leases	5.9		%	5.9		%

As of July 3, 2021, the Company has additional operating leases that have not yet commenced for future lease payments of $5.8 million. The Company had no finance leases that had not yet commenced nor entered into during the quarter.

Leases

LEASES

The Company leases certain manufacturing facilities, warehouses/distribution centers, office space, machinery, equipment, IT assets, and vehicles. If the contract provides the Company the right to substantially all of the economic benefits from the use of the identified asset and the right to direct the use of the identified asset, it is considered to be or contain a lease. Right-of-use ("ROU") assets and lease liabilities are recognized at lease commencement date based on the present value of the future lease payments over the expected lease term.

As most of the Company's leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The incremental borrowing rate is calculated based upon the sovereign treasury rate for the currency in which the lease liability is denominated when the Company takes possession of the leased asset, adjusted for various factors, such as term and internal credit spread. The ROU asset also includes any lease payments made and excludes lease incentive and initial direct costs incurred.

Leases entered into may include one or more options to renew. The renewal terms can extend the lease term from one to twenty-five years. The exercise of lease renewal options is at the Company's sole discretion. Renewal option periods are included in the measurement of the ROU asset and lease liability when the exercise is reasonably certain to occur. Some leases include options to terminate the lease upon breach of contract and are remeasured at that point in time.

The depreciable life of leased assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise.

Some of the Company's lease agreements include rental payments adjusted periodically for inflation or are based on an index rate. These increases are reflected as variable lease payments and are included in the measurement of the ROU asset and lease liability. The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

Operating leases are included in the following asset and liability accounts on the Company's Condensed Consolidated Balance Sheet: Operating Lease Assets, Current Operating Lease Liabilities, and Noncurrent Operating Lease Liabilities. ROU assets and liabilities arising from finance leases are included in the following asset and liability accounts on the Company's Condensed Consolidated Balance Sheet: Net Property, Plant and Equipment, Current Maturities of Long-Term Debt, and Long-Term Debt.

Short-term and variable lease expenses were immaterial. The components of lease expense were as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Operating Lease Cost	$	7.7	$	7.6	$	15.4	$	15.3
Finance Lease Cost:
Amortization of ROU Assets	0.1		0.1		0.2		0.2
Interest on Lease Liabilities	0.1		—		0.1		0.1
Total Lease Expense	$	7.9	7.7		$	15.7	$	15.6

Maturity of lease liabilities as of July 3, 2021 were as follows (in millions):

	Operating Leases		Finance Leases		Total
Remainder of 2021	$	14.3	$	0.3	$	14.6
2022	22.4		0.5		22.9
2023	15.6		0.6		16.2
2024	10.6		0.6		11.2
2025	8.0		0.6		8.6
Thereafter	18.7		1.3		20.0
Total Lease Payments	$	89.6	$	3.9	$	93.5
Less: Interest	(14.4)		(0.7)		(15.1)
Present Value of Lease Liabilities	$	75.2	$	3.2	$	78.4

Other information related to leases was as follows (in millions):

	Six Months Ended
Supplemental Cash Flows Information	July 3, 2021			June 27, 2020
Cash Paid for Amounts Included in the Measurement of Lease Liabilities:
Operating Cash Flows Used For Operating Leases	$	12.4		$	14.8
Operating Cash Flows Used For Finance Leases	0.1			0.1
Financing Cash Flows Used For Finance Leases	0.2			0.2
Leased Assets Obtained in Exchange for New Operating Lease Liabilities	9.7			18.3
Weighted Average Remaining Lease Term
Operating Leases	4.4 years			5.2 years
Finance Leases	6.8 years			7.8 years
Weighted Average Discount Rate
Operating Leases	6.7		%	8.3		%
Finance Leases	5.9		%	5.9		%

As of July 3, 2021, the Company has additional operating leases that have not yet commenced for future lease payments of $5.8 million. The Company had no finance leases that had not yet commenced nor entered into during the quarter.

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SHAREHOLDERS' EQUITY

6 Months Ended

Jul. 03, 2021

Stockholders' Equity Note [Abstract]

SHAREHOLDERS' EQUITY

SHAREHOLDERS’ EQUITY

Repurchase of Common Stock

At a meeting of the Board of Directors on October 25, 2019, the Company's Board of Directors approved the authorization to purchase up to $250.0 million of shares. The Company did not repurchase and retire any common stock during the three and six months ended July 3, 2021. For the six months ended June 27, 2020, the Company repurchased and retired 315,072 shares of its common stock at an average cost of $79.38 for a total cost of $25.0 million.

As of July 3, 2021, there was approximately $210.0 million in common stock available for repurchase under the October 2019 program.

Share-Based Compensation

The Company recognized approximately $4.5 million and $2.8 million in share-based compensation expense for the three months ended July 3, 2021 and June 27, 2020, respectively. Share-based compensation expense was $7.8 million and $5.5 million for the six months ended July 3, 2021 and June 27, 2020, respectively. The total income tax benefit recognized in the Condensed Consolidated Statements of Income for share-based compensation expense was $0.7 million and $0.2 million for the three months ended July 3, 2021 and June 27, 2020, respectively. The total income tax benefit recognized in the Condensed Consolidated Statements of Income for share-based compensation expense was $1.3 million and $0.4 million for the six months ended July 3, 2021 and June 27, 2020, respectively. The Company recognizes compensation expense on grants of share-based compensation awards on a straight-line basis over the vesting period of each award. As of July 3, 2021, total unrecognized compensation cost related to share-based compensation awards was approximately $25.1 million, net of estimated forfeitures, which the Company expects to recognize over a weighted average period of approximately 2.0 years.

Approximately 1.6 million shares were available for future grant under the 2018 Equity Incentive Plan as of July 3, 2021.

Stock Appreciation Rights

The Company uses stock settled stock appreciation rights (“SARs”) as a form of share-based incentive awards. SARs are the right to receive stock in an amount equal to the appreciation in value of a share of stock over the base price per share. Shares granted prior to fiscal 2020 generally vest over five years on the anniversary date while shares granted in or after fiscal 2020 generally vest over three years on the anniversary date of the grant date. Generally all grants expire 10 years from the grant date. All grants are made at prices equal to the fair market value of the stock on the grant date. For the six months ended July 3, 2021 and June 27, 2020, expired and canceled shares were immaterial.

The following table presents share-based compensation activity for the six months ended July 3, 2021 and June 27, 2020 (in millions):

	July 3, 2021		June 27, 2020
Total Intrinsic Value of Share-Based Incentive Awards Exercised	$	6.7	$	3.1
Cash Received from Stock Option Exercises	0.1		0.2
Income Tax Benefit from the Exercise of SARs	0.5		0.4
Total Fair Value of Share-Based Incentive Awards Vested	3.9		1.8

The following table presents assumptions used in the Company's Black-Scholes valuation related to grants of SARs:

	2021			2020
Per share weighted average fair value of grants	$	37.43		$	21.23
Risk-free interest rate	0.6		%	1.5		%
Expected life (years)	5.0			7.0
Expected volatility	32.5		%	25.2		%
Expected dividend yield	0.9		%	1.4		%

The average risk-free interest rate is based on the US Treasury security rate as of the grant date. The expected dividend yield is based on the projected annual dividend as a percentage of the estimated market value of the Company's common stock as of the grant date. The Company estimated the expected volatility using a weighted average of daily historical volatility of the Company's stock price over the expected term of the award. The Company estimated the expected term using historical data.

The following table presents a summary of share-based incentive plan grant activity for the six months ended July 3, 2021.

Number of Shares Under SARs	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Outstanding as of January 2, 2021	577,509	$	79.35	7.0	$	25.1
Granted	114,069	140.28
Exercised	(98,418)	75.97
Forfeited	(19,660)	85.81
Expired	(4,050)	72.29
Outstanding as of July 3, 2021	569,450	$	91.96	7.4	$	24.3
Exercisable as of July 3, 2021	242,394	$	76.02	5.9	$	13.9

Compensation expense recognized related to SARs was $2.2 million for the six months ended July 3, 2021.

As of July 3, 2021, there was $7.6 million of unrecognized compensation cost related to non-vested SARs that is expected to be recognized as a charge to earnings over a weighted average period of 2.4 years.

The number of SARs expected to vest is materially consistent with those outstanding and not yet exercisable.

Restricted Stock Awards and Restricted Stock Units

Restricted stock awards ("RSA") and restricted stock units ("RSU") consist of shares or the rights to shares of the Company's stock. The awards are restricted such that they are subject to substantial risk of forfeiture and to restrictions on their sale or other transfer. As defined in the individual grant agreements, acceleration of vesting may occur under a change in control, death or disability.

The following table presents a summary of RSA award activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested RSAs as of January 2, 2021	16,280	$	70.05	0.3
Granted	7,760	149.50
Vested	(16,280)	70.05
Unvested RSAs as of July 3, 2021	7,760	$	149.50	0.8

RSAs vest on the first anniversary of the grant date, provided the holder of the shares is continuously employed by or in the service of the Company until the vesting date. Compensation expense recognized related to the RSAs was $0.6 million for the six months ended July 3, 2021.

As of July 3, 2021, there was $1.0 million of unrecognized compensation cost related to non-vested RSAs that is expected to be recognized as a charge to earnings over a weighted average period of 0.8 years.

The following table presents a summary of RSU award activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested RSUs as of January 2, 2021	164,398	$	81.16	1.7
Granted	48,280	136.98
Vested	(63,177)	79.19
Forfeited	(6,589)	83.78
Unvested RSUs as of July 3, 2021	142,912	$	100.12	2.1

RSUs granted prior to fiscal 2020 vest on the third anniversary of the grant date while RSUs granted in or after fiscal 2020 vest one third each year on the anniversary of the grant date, provided the holder of the RSUs is continuously employed by the Company until the vesting date. Compensation expense recognized related to the RSUs was $3.3 million for the six months ended July 3, 2021.

As of July 3, 2021, there was $10.0 million of unrecognized compensation cost related to non-vested RSUs that is expected to be recognized as a charge to earnings over a weighted average period of 2.1 years.

Performance Share Units

Performance share units ("PSU") consist of shares or the rights to shares of the Company's stock which are awarded to employees of the Company. These shares are payable upon the determination that the Company achieved certain established performance targets and can range from 0% to 200% of the targeted payout based on the actual results. PSUs have a performance period of 3 years and vest 3 years from the grant date and are issued at a performance target of 100%. The PSUs have performance criteria based on a return on invested capital metric or they have performance criteria using returns relative to the Company's peer group. As set forth in the individual award agreements, acceleration of vesting may occur under a change in control, death or disability. There are no voting rights associated with these instruments until vesting occurs and a share of stock is issued. Some of the PSU awards are valued using a Monte Carlo simulation method as of the grant date while others are valued using the closing market price as of the grant date depending on the performance criteria for the award.

The assumptions used in the Company's Monte Carlo simulation were as follows:

	2021		2020
Risk-free interest rate	0.2	%	1.4	%
Expected life (years)	3.0		3.0
Expected volatility	37.0	%	24.0	%
Expected dividend yield	0.9	%	1.4	%

The following table presents a summary of PSU activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested PSUs as of January 2, 2021	87,522	$	97.59	1.8
Granted	33,125	122.36
Vested	(10,891)	91.65
Forfeited	(10,651)	78.88
Unvested PSUs as of July 3, 2021	99,105	$	109.68	1.9

Compensation expense for awards granted is recognized based on the grant issuance value or the expected payout ratio depending upon the performance criterion for the award, net of estimated forfeitures. Compensation expense recognized related to PSUs was $1.7 million for the six months ended July 3, 2021. Total unrecognized compensation expense for all PSUs granted as of July 3, 2021 is estimated to be $6.5 million which is expected to be recognized as a charge to earnings over a weighted average period of 1.9 years.

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INCOME TAXES

6 Months Ended

Jul. 03, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

The effective tax rate for the three months ended July 3, 2021 was 19.1% versus 22.5% for the three months ended June 27, 2020. The effective tax rate for the six months ended July 3, 2021 and June 27, 2020 was 21.0% and 22.8%, respectively. The change in the effective tax rate for the three and six months ended July 3, 2021 was primarily driven by the mix of earnings.

As of July 3, 2021 and January 2, 2021, the Company had approximately $9.3 million and $6.8 million of unrecognized tax benefits, all of which would impact the effective income tax rate if recognized. Potential interest and penalties related to unrecognized tax benefits are recorded in income tax expense. The Company had approximately $2.9 million and $2.7 million of accrued interest as of July 3, 2021 and January 2, 2021, respectively.

With few exceptions, the Company is no longer subject to US Federal and state/local income tax examinations by tax authorities for years prior to 2015, and the Company is no longer subject to non-US income tax examinations by tax authorities for years prior to 2013.

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EARNINGS PER SHARE

6 Months Ended

Jul. 03, 2021

Earnings Per Share [Abstract]

EARNINGS PER SHARE

EARNINGS PER SHARE

Diluted earnings per share is calculated based upon earnings applicable to common shares divided by the weighted-average number of common shares outstanding during the period adjusted for the effect of other dilutive securities. The amount of the anti-dilutive shares were 0.1 million and 0.6 million for the three months ended July 3, 2021 and June 27, 2020, respectively. The amount of the anti-dilutive shares were 0.1 million and 0.5 million for the six months ended July 3, 2021 and June 27, 2020, respectively. The following table reconciles the basic and diluted shares used in earnings per share calculations for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended		Six Months Ended
	July 3, 2021	June 27, 2020	July 3, 2021	June 27, 2020
Denominator for Basic Earnings Per Share	40.7	40.5	40.6	40.6
Effect of Dilutive Securities	0.3	0.2	0.4	0.1
Denominator for Diluted Earnings Per Share	41.0	40.7	41.0	40.7

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CONTINGENCIES

6 Months Ended

Jul. 03, 2021

Commitments and Contingencies Disclosure [Abstract]

CONTINGENCIES

CONTINGENCIES

One of the Company's subsidiaries that it acquired in 2007 is subject to numerous claims filed in various jurisdictions relating to certain sub-fractional motors that were primarily manufactured through 2004 and that were included as components of residential and commercial ventilation units manufactured and sold in high volumes by a third party. These ventilation units are subject to product safety requirements and other potential regulation of their performance by government agencies such as the US Consumer Product Safety Commission (“CPSC”). The claims generally allege that the ventilation units were the cause of fires. The Company has recorded an estimated liability for incurred claims. Based on the current facts, the Company cannot assure that these claims, individually or in the aggregate, will not have a material adverse effect on its subsidiary's financial condition. The Company's subsidiary cannot reasonably predict the outcome of these claims, the nature or extent of any CPSC or other remedial actions, if any, that the Company's subsidiary may need to undertake with respect to motors that remain in the field, or the costs that may be incurred, some of which could be significant.

The Company is, from time to time, party to litigation and other legal or regulatory proceedings that arise in the normal course of its business operations and the outcomes of which are subject to significant uncertainty, including product warranty and liability claims, contract disputes and environmental, asbestos, intellectual property, employment and other litigation matters. The Company's products are used in a variety of industrial, commercial and residential applications that subject the Company to claims that the use of its products is alleged to have resulted in injury or other damage. Many of these matters will only be resolved when one or more future events occur or fail to occur. Management conducts regular reviews, including updates from legal counsel, to assess the need for accounting recognition or disclosure of these contingencies, and such assessment inherently involves an exercise in judgment. The Company accrues for exposures in amounts that it believes are adequate, and the Company does not believe that the outcome of any such lawsuit individually or collectively will have a material effect on the Company's financial position, its results of operations or its cash flows.

The Company recognizes the cost associated with its standard warranty on its products at the time of sale. The amount recognized is based on historical experience. The following table presents a reconciliation of the changes in accrued warranty costs for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning Balance	$	16.3	$	15.4	$	15.5	$	15.1
Less: Payments	(4.2)		(3.3)		(8.7)		(6.9)
Provisions	4.6		3.5		10.0		7.5
Translation Adjustments	—		0.1		(0.1)		—
Ending Balance	$	16.7	$	15.7	$	16.7	$	15.7

These liabilities are included in Other Accrued Expenses and Other Noncurrent Liabilities on the Condensed Consolidated Balance Sheet.

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DERIVATIVE FINANCIAL INSTRUMENTS

6 Months Ended

Jul. 03, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS

DERIVATIVE FINANCIAL INSTRUMENTS

The Company is exposed to certain risks relating to its ongoing business operations. The primary risks managed using derivative instruments are commodity price risk, currency exchange risk, and interest rate risk. Forward contracts on certain commodities are entered into to manage the price risk associated with forecasted purchases of materials used in the Company's manufacturing process. Forward contracts on certain currencies are entered into to manage forecasted cash flows in certain foreign currencies. Interest rate swaps are utilized to manage interest rate risk associated with the Company's floating rate borrowings.

The Company is exposed to credit losses in the event of non-performance by the counterparties to various financial agreements, including its commodity hedging transactions, foreign currency exchange contracts and interest rate swap agreements. Exposure to counterparty credit risk is managed by limiting counterparties to major international banks and financial institutions meeting established credit guidelines and continually monitoring their compliance with the credit guidelines. The Company does not obtain collateral or other security to support financial instruments subject to credit risk. The Company does not anticipate non-performance by its counterparties, but cannot provide assurances.

The Company recognizes all derivative instruments as either assets or liabilities at fair value in the Condensed Consolidated Balance Sheets. The Company designates commodity forward contracts as cash flow hedges of forecasted purchases of commodities, currency forward contracts as cash flow hedges of forecasted foreign currency cash flows and interest rate swaps as cash flow hedges of forecasted LIBOR-based interest payments. There were no significant collateral deposits on derivative financial instruments as of July 3, 2021 or June 27, 2020.

Cash Flow Hedges

The effective portion of the gain or loss on the derivative is reported as a component of AOCI and reclassified into the same line within the Condensed Consolidated Statement of Income as the earnings effect of the hedged item in the same period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or changes in market value of derivatives not designated as hedges are recognized in current earnings.

At July 3, 2021, the Company had $10.7 million, net of tax, of derivative gains on closed hedge instruments in AOCI that will be realized in earnings when the hedged items impact earnings. At January 2, 2021, the Company had $3.7 million, net of tax, of derivative gains on closed hedge instruments in AOCI that was subsequently realized in earnings when the hedged items impacted earnings.

As of July 3, 2021, the Company had the following currency forward contracts outstanding (with maturities extending through December 2022) to hedge forecasted foreign currency cash flows (in millions):

	Notional Amount (in US Dollars)
Chinese Renminbi	$	146.1
Mexican Peso	194.1
Euro	141.7
Indian Rupee	49.5
Canadian Dollar	1.0
Australian Dollar	20.3
British Pound	10.8
Thai Baht	5.7

As of July 3, 2021, the Company had the following commodity forward contracts outstanding (with maturities extending through December 2022) to hedge forecasted purchases of commodities (notional amounts expressed in terms of the dollar value of the hedged item (in millions)):

	Notional Amount
Copper	$	135.5
Aluminum	8.0

In April 2018, the Company entered into a spot, non-amortizing interest rate swap to pay fixed/ receive floating with a notional amount of $88.4 million to manage fluctuations in cash flows from interest rate risk related to floating rate interest. The swap expired in April, 2021 and was settled using cash from operations.

The Company entered into two receive variable/pay-fixed forward starting non-amortizing interest rate swaps in June 2020, with a total notional amount of $250.0 million. These swaps became effective July 2021 and will expire in July 2025.

The following table presents the fair values of derivative instruments as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021
	Prepaid Expenses and Other Current Assets		Other Noncurrent Assets		Other Accrued Expenses		Other Noncurrent Liabilities
Designated as Hedging Instruments:
Interest Rate Swap Contracts	$	—	$	1.8	$	—	$	—
Currency Contracts	13.6		0.9		0.9		0.1
Commodity Contracts	16.3		1.1		1.4		0.5
Not Designated as Hedging Instruments:
Currency Contracts	—		—		0.3		—
Commodity Contracts	0.4		0.1		—		—
Total Derivatives	$	30.3	$	3.9	$	2.6	$	0.6

	January 2, 2021
	Prepaid Expenses and Other Current Assets		Other Noncurrent Assets		Other Accrued Expenses		Other Noncurrent Liabilities
Designated as Hedging Instruments:
Interest Rate Swap Contracts	$	—	$	—	$	0.7	$	1.4
Currency Contracts	16.4		1.6		1.0		0.1
Commodity Contracts	11.3		0.1		—		—
Not Designated as Hedging Instruments:
Currency Contracts	0.2		—		—		—
Commodity Contracts	0.1		—		—		—
Total Derivatives	$	28.0	$	1.7	$	1.7	$	1.5

The following table presents the effect of derivative instruments on the Condensed Consolidated Statements of Income and Condensed Consolidated Statement of Comprehensive Income (pre-tax) (in millions):

Derivatives Designated as Cash Flow Hedging Instruments

	Three Months Ended
	July 3, 2021								June 27, 2020
	Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total		Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	$	10.9	$	7.5	$	(0.9)	$	17.5	$	12.6	$	2.8	$	(0.5)	$	14.9
Amounts Reclassified from Other Comprehensive Income (Loss):
Loss recognized in Net Sales	—		—		—		—		—		(0.1)		—		(0.1)
Gain (Loss) Recognized in Cost of Sales	8.6		4.0		—		12.6		(0.9)		0.3		—		(0.6)
Loss Recognized in Operating Expenses	—		(1.3)		—		(1.3)		—		(1.6)		—		(1.6)
Gain Recognized in Interest Expense	—		—		—		—		—		—		0.2		0.2
	Six Months Ended
	July 3, 2021								June 27, 2020
	Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total		Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	$	25.0	$	7.7	$	4.0	$	36.7	$	(0.7)	$	(22.3)	$	(1.1)	$	(24.1)
Amounts Reclassified from Other Comprehensive Income (Loss):
Gain Recognized in Net Sales	—		0.1		—		0.1		—		—		—		—
Gain (Loss) Recognized in Cost of Sales	13.8		6.6		—		20.4		(2.0)		2.8		—		0.8
Gain (Loss) Recognized in Operating Expenses	—		2.2		—		2.2		—		(0.9)		—		(0.9)
Gain Recognized in Interest Expense	—		—		0.1		0.1		—		—		0.6		0.6

Derivatives Not Designated as Cash Flow Hedging Instruments (in millions):

	Three Months Ended
	July 3, 2021				June 27, 2020
	Commodity Forwards		Currency Forwards		Commodity Forwards		Currency Forwards
Gain recognized in Cost of Sales	$	0.2	$	—	$	0.1	$	—
Gain (Loss) recognized in Operating Expenses	—		(3.7)		—		2.1
	Six Months Ended
	July 3, 2021				June 27, 2020
	Commodity Forwards		Currency Forwards		Commodity Forwards		Currency Forwards
Gain recognized in Cost of Sales	$	0.4	$	—	$	—	$	—
Gain (Loss) recognized in Operating Expenses	—		2.1		—		(1.3)

The net AOCI hedging component balance of a $34.1 million gain at July 3, 2021 includes $20.9 million of net current deferred gain expected to be realized in the next twelve months. The gain/loss reclassified from AOCI into earnings on such derivatives will be recognized in the same period in which the related item affects earnings.

The Company's commodity and currency derivative contracts are subject to master netting agreements with the respective counterparties which allow the Company to net settle transactions with a single net amount payable by one party to another party. The Company has elected to present the derivative assets and derivative liabilities on the Condensed Consolidated Balance Sheets on a gross basis for the periods ended July 3, 2021 and January 2, 2021.

The following table presents the derivative assets and derivative liabilities presented on a net basis under enforceable master netting agreements (in millions):

	July 3, 2021
	Gross Amounts as Presented in the Condensed Consolidated Balance Sheet		Derivative Contract Amounts Subject to Right of Offset		Derivative Contracts as Presented on a Net Basis
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	13.6	$	(1.2)	$	12.4
Derivative Commodity Contracts	16.7		(1.4)		15.3
Other Noncurrent Assets:
Derivative Currency Contracts	0.9		—		0.9
Derivative Commodity Contracts	1.2		(0.4)		0.8
Other Accrued Expenses:
Derivative Currency Contracts	1.2		(1.2)		—
Derivative Commodity Contracts	1.4		(1.4)		—
Other Noncurrent Liabilities:
Derivative Currency Contracts	0.1		—		0.1
Derivative Commodity Contracts	0.5		(0.4)		0.1

	January 2, 2021
	Gross Amounts as Presented in the Condensed Consolidated Balance Sheet		Derivative Contract Amounts Subject to Right of Offset		Derivative Contracts as Presented on a Net Basis
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	16.6	$	(1.0)	$	15.6
Derivative Commodity Contracts	11.4		—		11.4
Other Noncurrent Assets:
Derivative Currency Contracts	1.6		—		1.6
Derivative Commodity Contracts	0.1		—		0.1
Other Accrued Expenses:
Derivative Currency Contracts	1.0		(1.0)		—
Other Noncurrent Liabilities:
Derivative Currency Contracts	0.1		—		0.1

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FAIR VALUE

6 Months Ended

Jul. 03, 2021

Fair Value Disclosures [Abstract]

FAIR VALUE

FAIR VALUE

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The inputs used to measure fair value are classified into the following hierarchy:

Level 1	Unadjusted quoted prices in active markets for identical assets or liabilities
Level 2	Unadjusted quoted prices in active markets for similar assets or liabilities, or
	Unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or
	Inputs other than quoted prices that are observable for the asset or liability
Level 3	Unobservable inputs for the asset or liability

The Company uses the best available information in measuring fair value. Financial assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement.

The fair values of cash equivalents and short-term deposits approximate their carrying values as of July 3, 2021 and January 2, 2021, due to the short period of time to maturity and are classified using Level 1 inputs. The fair values of trade receivables and accounts payable approximate the carrying values due to the short period of time to maturity. See Note 7 for disclosure of the approximate fair value of the Company's debt at July 3, 2021 and January 2, 2021.

The following table sets forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021		January 2, 2021		Classification
Assets:
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	13.6	$	16.6	Level 2
Derivative Commodity Contracts	16.7		11.4		Level 2
Other Noncurrent Assets:
Assets Held in Rabbi Trust	6.7		6.5		Level 1
Derivative Currency Contracts	0.9		1.6		Level 2
Derivative Commodity Contracts	1.2		0.1		Level 2
Interest Rate Swap	1.8		—		Level 2
Liabilities:
Other Accrued Expenses:
Interest Rate Swap	—		0.7		Level 2
Derivative Currency Contracts	1.2		1.0		Level 2
Derivative Commodity Contracts	1.4		—		Level 2
Other Noncurrent Liabilities:
Interest Rate Swap	—		1.4		Level 2
Derivative Currency Contracts	0.1		0.1		Level 2
Derivative Commodity Contracts	0.5		—		Level 2

Level 1 fair value measurements for assets held in a Rabbi Trust are unadjusted quoted prices.

Level 2 fair value measurements for derivative assets and liabilities are measured using quoted prices in active markets for similar assets and liabilities. Interest rate swaps are valued based on the discounted cash flows for the LIBOR forward yield curve for a swap with similar contractual terms. Foreign currency forwards are valued based on exchange rates quoted by domestic and foreign banks for similar instruments. Commodity forwards are valued based on observable market transactions of forward commodity prices.

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RESTRUCTURING ACTIVITIES

6 Months Ended

Jul. 03, 2021

Restructuring and Related Activities [Abstract]

RESTRUCTURING ACTIVITIES

RESTRUCTURING ACTIVITIES

The Company incurred restructuring and restructuring-related costs on projects during fiscal 2021 and 2020. Restructuring costs include employee termination and plant relocation costs. Restructuring-related costs include costs directly associated with actions resulting from the Company's simplification initiatives, such as asset write-downs or accelerated depreciation due to shortened useful lives in connection with site closures, discretionary employment benefit costs and other facility rationalization costs. Restructuring costs for employee termination expenses are generally required to be accrued over the employees' remaining service period while restructuring costs for plant relocation costs and restructuring-related costs are generally required to be expensed as incurred.

The following table presents a reconciliation of provisions and payments for the restructuring projects for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning Balance	$	2.7	$	2.4	$	2.0	$	0.9
Provision	1.5		7.8		3.2		12.9
Less: Payments/ Other	1.7		7.3		2.7		10.9
Ending Balance	$	2.5	$	2.9	$	2.5	$	2.9

The following table presents a reconciliation of restructuring and restructuring-related costs for restructuring projects for the three and six months ended July 3, 2021 and June 27, 2020, respectively (in millions):

	Three Months Ended
	July 3, 2021						June 27, 2020
Restructuring Costs:	Cost of Sales		Operating Expenses		Total		Cost of Sales		Operating Expenses		Total
Employee Termination Expenses	$	0.2	$	0.2	$	0.4	$	1.4	$	2.6	$	4.0
Facility Related Costs	0.8		0.1		0.9		3.2		0.4		3.6
Other Expenses	0.2		—		0.2		0.2		—		0.2
Total Restructuring Costs	$	1.2	$	0.3	$	1.5	$	4.8	$	3.0	$	7.8
	Six Months Ended
	July 3, 2021						June 27, 2020
Restructuring Costs:	Cost of Sales		Operating Expenses		Total		Cost of Sales		Operating Expenses		Total
Employee Termination Expenses	$	0.4	$	0.6	$	1.0	$	2.9	$	3.0	$	5.9
Facility Related Costs	1.6		0.3		1.9		5.9		0.8		6.7
Other Expenses	0.3		—		0.3		0.3		—		0.3
Total Restructuring Costs	$	2.3	$	0.9	$	3.2	$	9.1	$	3.8	$	12.9

The following table presents the allocation of restructuring and restructuring-related costs by segment for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

Restructuring Costs - Three Months Ended	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
July 3, 2021	$	1.5	$	0.1	$	0.3	$	0.3	$	0.8
June 27, 2020	$	7.8	$	2.3	$	2.0	$	1.3	$	2.2
Restructuring Costs - Six Months Ended	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
July 3, 2021	$	3.2	$	0.3	$	0.8	$	0.6	$	1.5
June 27, 2020	$	12.9	$	4.1	$	2.9	$	2.4	$	3.5

The Company's current restructuring activities are expected to continue. The Company expects to record aggregate future charges of approximately $3.5 million which includes $1.9 million of employee termination expenses and $1.6 million of facility related costs on approved projects. The Company anticipates total restructuring costs of approximately $16.0 million for fiscal 2021 excluding costs related to the Rexnord Transaction.

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SUBSEQUENT EVENT	6 Months Ended
	Jul. 03, 2021
Subsequent Events [Abstract]
SUBSEQUENT EVENT	SUBSEQUENT EVENTThe Company has evaluated subsequent events since July 3, 2021, the date of these financial statements, and is not aware of any events to disclose.

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BASIS OF PRESENTATION (Policies)

6 Months Ended

Jul. 03, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

New Accounting Standards

Adopted Accounting Standards

In December 2019, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes. The ASU simplifies the accounting for income taxes by removing certain exceptions to the general principles of Topic 740, and clarifies and amends existing guidance to improve consistent application. This ASU becomes effective for fiscal years beginning after December 15, 2020, with early adoption permitted. The Company adopted the standard as of January 3, 2021, the beginning of fiscal 2021, with no material impact on the Company's Condensed Consolidated Financial Statements.

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OTHER FINANCIAL INFORMATION (Tables)

6 Months Ended

Jul. 03, 2021

Balance Sheet Related Disclosures [Abstract]

Percentage Distribution between Major Classes of Inventory

The following table presents approximate percentage distribution between major classes of inventories:

	July 3, 2021	January 2, 2021
Raw Material and Work in Process	49.5%	48.7%
Finished Goods and Purchased Parts	50.5%	51.3%

Property, Plant, and Equipment by Major Classification

The following table presents property, plant, and equipment by major classification (dollars in millions):

	Useful Life in Years	July 3, 2021		January 2, 2021
Land and Improvements		$	74.9	$	76.1
Buildings and Improvements	3 - 50	288.4		290.7
Machinery and Equipment	3 - 15	979.3		978.2
Property, Plant and Equipment		1,342.6		1,345.0
Less: Accumulated Depreciation		(808.5)		(789.5)
Net Property, Plant and Equipment		$	534.1	$	555.5

Disaggregation of Revenue

The following tables presents the Company’s revenues disaggregated by geographical region (in millions):

	Three Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	176.1	$	73.9	$	226.7	$	173.2	$	649.9
Asia	53.5		46.9		7.7		7.4		115.5
Europe	26.7		12.1		10.4		25.1		74.3
Rest-of-World	13.0		12.3		12.5		9.4		47.2
Total	$	269.3	$	145.2	$	257.3	$	215.1	$	886.9
June 27, 2020	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	112.5	$	69.2	$	158.8	$	123.2	$	463.7
Asia	28.9		36.6		1.0		7.5		74.0
Europe	25.5		14.7		7.5		22.2		69.9
Rest-of-World	9.0		0.1		10.9		6.5		26.5
Total	$	175.9	$	120.6	$	178.2	$	159.4	$	634.1

	Six Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	330.2	$	145.0	$	436.4	$	337.0	$	1,248.6
Asia	99.5		90.1		17.0		14.3		220.9
Europe	51.4		23.7		19.9		48.6		143.6
Rest-of-World	25.2		22.8		23.1		16.8		87.9
Total	$	506.3	$	281.6	$	496.4	$	416.7	$	1,701.0
June 27, 2020	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
North America	$	255.9	$	142.1	$	343.4	$	284.1	$	1,025.5
Asia	52.3		73.4		9.6		12.4		147.7
Europe	54.0		27.9		15.1		46.1		143.1
Rest-of-World	13.1		6.8		20.2		11.9		52.0
Total	$	375.3	$	250.2	$	388.3	$	354.5	$	1,368.3

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Jul. 03, 2021

Equity [Abstract]

Changes In Accumulated Other Comprehensive Loss By Component, Net Of Tax

The following tables present changes in AOCI by component for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended
July 3, 2021	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	29.4	$	(30.8)	$	(177.1)	$	(178.5)
Other Comprehensive Income before Reclassifications	17.5		—		9.3		26.8
Tax Impact	(4.2)		—		—		(4.2)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(11.3)		0.5		—		(10.8)
Tax Impact	2.7		(0.1)		—		2.6
Net Current Period Other Comprehensive Income	4.7		0.4		9.3		14.4
Ending Balance	$	34.1	$	(30.4)	$	(167.8)	$	(164.1)
June 27, 2020	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	(23.6)	$	(30.5)	$	(272.0)	$	(326.1)
Other Comprehensive Income (Loss) before Reclassifications	14.9		(0.1)		18.2		33.0
Tax Impact	(3.6)		—		—		(3.6)
Amounts Reclassified from Accumulated Other Comprehensive Income	2.1		0.2		—		2.3
Tax Impact	(0.5)		(0.1)		—		(0.6)
Net Current Period Other Comprehensive Income	12.9		—		18.2		31.1
Ending Balance	$	(10.7)	$	(30.5)	$	(253.8)	$	(295.0)

	Six Months Ended
	July 3, 2021
	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning Balance	$	23.5	$	(31.1)	$	(155.7)	$	(163.3)
Other Comprehensive Income (Loss) before Reclassifications	36.7		—		(12.1)		24.6
Tax Impact	(8.8)		—		—		(8.8)
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(22.8)		0.9		—		(21.9)
Tax Impact	5.5		(0.2)		—		5.3
Net Current Period Other Comprehensive Income (Loss)	10.6		0.7		(12.1)		(0.8)
Ending Balance	$	34.1	$	(30.4)	$	(167.8)	$	(164.1)
	Six Months Ended
	June 27, 2020
	Hedging Activities		Pension and Post Retirement Benefit Adjustments		Foreign Currency Translation Adjustments		Total
Beginning balance	$	8.0	$	(31.0)	$	(214.8)	$	(237.8)
Other Comprehensive Income (Loss) before Reclassifications	(24.1)		0.3		(39.0)		(62.8)
Tax Impact	5.8		—		—		5.8
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(0.5)		0.3		—		(0.2)
Tax Impact	0.1		(0.1)		—		—
Net Current Period Other Comprehensive Income (Loss)	(18.7)		0.5		(39.0)		(57.2)
Ending Balance	$	(10.7)	$	(30.5)	$	(253.8)	$	(295.0)

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GOODWILL AND INTANGIBLE ASSETS (Tables)

6 Months Ended

Jul. 03, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Changes to Goodwill

The following table presents changes to goodwill during the six months ended July 3, 2021 (in millions):

	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
Balance as of January 2, 2021	$	1,518.2	$	433.3	$	163.7	$	330.8	$	590.4
Translation Adjustments	(6.4)		(1.5)		(0.7)		(0.2)		(4.0)
Balance as of July 3, 2021	$	1,511.8	$	431.8	$	163.0	$	330.6	$	586.4
Cumulative Goodwill Impairment Charges	$	295.7	$	183.2	$	72.1	$	17.2	$	23.2

Schedule of Finite-Lived Intangible Assets

The following table presents intangible assets (in millions):

		July 3, 2021				January 2, 2021
	Weighted Average Amortization Period (Years)	Gross Value		Accumulated Amortization		Gross Value		Accumulated Amortization
Amortizable Intangible Assets:
Customer Relationships	17	$	704.1	$	366.1	$	708.6	$	349.4
Technology	14	145.9		110.0		146.3		108.0
Trademarks	14	37.0		28.4		37.7		27.7
		887.0		504.5		892.6		485.1
Non-Amortizable Trade Name		122.4		—		122.8		—
		$	1,009.4	$	504.5	$	1,015.4	$	485.1
Intangible Assets, Net of Amortization		$	504.9			$	530.3

Schedule of Indefinite-Lived Intangible Assets

The following table presents intangible assets (in millions):

		July 3, 2021				January 2, 2021
	Weighted Average Amortization Period (Years)	Gross Value		Accumulated Amortization		Gross Value		Accumulated Amortization
Amortizable Intangible Assets:
Customer Relationships	17	$	704.1	$	366.1	$	708.6	$	349.4
Technology	14	145.9		110.0		146.3		108.0
Trademarks	14	37.0		28.4		37.7		27.7
		887.0		504.5		892.6		485.1
Non-Amortizable Trade Name		122.4		—		122.8		—
		$	1,009.4	$	504.5	$	1,015.4	$	485.1
Intangible Assets, Net of Amortization		$	504.9			$	530.3

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

The following table presents future estimated annual amortization for intangible assets (in millions):

Year	Estimated Amortization
2022	$	41.5
2023	41.5
2024	40.9
2025	38.8
2026	35.3

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SEGMENT INFORMATION (Tables)

6 Months Ended

Jul. 03, 2021

Segment Reporting [Abstract]

Schedule Of Reportable Segments

The following sets forth certain financial information attributable to the Company's operating segments for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Eliminations		Total
External Sales	$	269.3	$	145.2	$	257.3	$	215.1	$	—	$	886.9
Intersegment Sales	19.9		7.3		5.1		0.8		(33.1)		—
Total Sales	289.2		152.5		262.4		215.9		(33.1)		886.9
Gross Profit	67.5		26.2		74.0		83.8		—		251.5
Operating Expenses	40.3		23.1		27.0		49.8		—		140.2
Asset Impairments	1.8		—		0.5		—		—		2.3
Total Operating Expenses	42.1		23.1		27.5		49.8		—		142.5
Income from Operations	25.4		3.1		46.5		34.0		—		109.0
Depreciation and Amortization	7.8		5.7		3.6		13.4		—		30.5
Capital Expenditures	4.5		3.3		3.0		2.8		—		13.6
June 27, 2020
External Sales	$	175.9	$	120.6	$	178.2	$	159.4	$	—	$	634.1
Intersegment Sales	16.9		9.1		3.9		0.6		(30.5)		—
Total Sales	192.8		129.7		182.1		160.0		(30.5)		634.1
Gross Profit	42.4		24.9		47.4		55.6		—		170.3
Operating Expenses	34.2		21.7		26.6		39.1		—		121.6
Asset Impairments	2.0		—		0.8		—		—		2.8
Total Operating Expenses	36.2		21.7		27.4		39.1		—		124.4
Income from Operations	6.2		3.2		20.0		16.5		—		45.9
Depreciation and Amortization	8.3		6.0		5.0		14.0		—		33.3
Capital Expenditures	2.2		2.3		2.6		2.4		—		9.5

	Six Months Ended
July 3, 2021	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Eliminations		Total
External Sales	$	506.3	$	281.6	$	496.4	$	416.7	$	—	$	1,701.0
Intersegment Sales	37.4		11.0		9.4		1.5		(59.3)		—
Total Sales	543.7		292.6		505.8		418.2		(59.3)		1,701.0
Gross Profit	133.0		53.0		148.0		162.9		—		496.9
Operating Expenses	78.3		46.2		57.7		106.3		—		288.5
Asset Impairments	1.8		—		0.5		—		—		2.3
Total Operating Expenses	80.1		46.2		58.2		106.3		—		290.8
Income from Operations	52.9		6.8		89.8		56.6		—		206.1
Depreciation and Amortization	15.6		11.6		8.1		27.0		—		62.3
Capital Expenditures	7.8		5.7		6.2		4.6		—		24.3
June 27, 2020
External Sales	$	375.3	$	250.2	$	388.3	$	354.5	$	—	$	1,368.3
Intersegment Sales	28.7		15.8		8.4		1.3		(54.2)		—
Total Sales	404.0		266.0		396.7		355.8		(54.2)		1,368.3
Gross Profit	92.7		47.9		106.8		126.2		—		373.6
Operating Expenses	71.7		44.6		56.0		81.2		—		253.5
Gain on Divestiture of Businesses	(0.1)		—		—		—		—		(0.1)
Asset Impairments	2.8		0.2		1.3		—		—		4.3
Total Operating Expenses	74.4		44.8		57.3		81.2		—		257.7
Income from Operations	18.3		3.1		49.5		45.0		—		115.9
Depreciation and Amortization	16.6		11.9		9.7		27.7		—		65.9
Capital Expenditures	5.3		4.3		6.2		4.6		—		20.4

Reconciliation of Segment Assets

The following table presents identifiable assets information attributable to the Company's operating segments as of July 3, 2021 and January 2, 2021 (in millions):

	Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions		Total
Identifiable Assets as of July 3, 2021	$	1,390.5	$	870.2	$	966.1	$	1,546.9	$	4,773.7
Identifiable Assets as of January 2, 2021	1,319.6		837.5		890.4		1,541.5		4,589.0

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DEBT AND BANK CREDIT FACILITIES (Tables)

6 Months Ended

Jul. 03, 2021

Debt Disclosure [Abstract]

Schedule Of Indebtedness

The following table presents the Company’s indebtedness as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021		January 2, 2021
Term Facility	$	620.0	$	670.0
Senior Notes	400.0		400.0
Other	4.3		4.6
Less: Debt Issuance Costs	(4.4)		(3.2)
Total	1,019.9		1,071.4
Less: Current Maturities	230.9		231.0
Long-Term Debt	$	789.0	$	840.4

Details On The Senior Notes

The following table presents details on the Notes at July 3, 2021 (in millions):

	Principal		Interest Rate	Maturity
Fixed Rate Series 2011A	$	230.0	4.8 to 5.0%	July 14, 2021
Fixed Rate Series 2011A	170.0		4.9 to 5.1%	July 14, 2023
	$	400.0

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RETIREMENT AND POST RETIREMENT HEALTH CARE PLANS (Tables)

6 Months Ended

Jul. 03, 2021

Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract]

Schedule of Net Periodic Defined Benefit Pension Cost

The following table presents the Company’s net periodic benefit cost (income) components (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Service Cost	$	0.3	$	0.3	$	0.6	$	1.1
Interest Cost	1.4		2.0		2.9		4.1
Expected Return on Plan Assets	(3.1)		(3.3)		(6.2)		(6.6)
Amortization of Prior Service Cost and Net Actuarial Loss	0.5		0.2		0.9		0.3
Net Periodic Benefit Income	$	(0.9)	$	(0.8)	$	(1.8)	$	(1.1)

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LEASES (Tables)

6 Months Ended

Jul. 03, 2021

Leases [Abstract]

Lease Costs

The components of lease expense were as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Operating Lease Cost	$	7.7	$	7.6	$	15.4	$	15.3
Finance Lease Cost:
Amortization of ROU Assets	0.1		0.1		0.2		0.2
Interest on Lease Liabilities	0.1		—		0.1		0.1
Total Lease Expense	$	7.9	7.7		$	15.7	$	15.6

Other information related to leases was as follows (in millions):

	Six Months Ended
Supplemental Cash Flows Information	July 3, 2021			June 27, 2020
Cash Paid for Amounts Included in the Measurement of Lease Liabilities:
Operating Cash Flows Used For Operating Leases	$	12.4		$	14.8
Operating Cash Flows Used For Finance Leases	0.1			0.1
Financing Cash Flows Used For Finance Leases	0.2			0.2
Leased Assets Obtained in Exchange for New Operating Lease Liabilities	9.7			18.3
Weighted Average Remaining Lease Term
Operating Leases	4.4 years			5.2 years
Finance Leases	6.8 years			7.8 years
Weighted Average Discount Rate
Operating Leases	6.7		%	8.3		%
Finance Leases	5.9		%	5.9		%

Finance Lease Maturities

Maturity of lease liabilities as of July 3, 2021 were as follows (in millions):

	Operating Leases		Finance Leases		Total
Remainder of 2021	$	14.3	$	0.3	$	14.6
2022	22.4		0.5		22.9
2023	15.6		0.6		16.2
2024	10.6		0.6		11.2
2025	8.0		0.6		8.6
Thereafter	18.7		1.3		20.0
Total Lease Payments	$	89.6	$	3.9	$	93.5
Less: Interest	(14.4)		(0.7)		(15.1)
Present Value of Lease Liabilities	$	75.2	$	3.2	$	78.4

Operating Lease Maturities

Maturity of lease liabilities as of July 3, 2021 were as follows (in millions):

	Operating Leases		Finance Leases		Total
Remainder of 2021	$	14.3	$	0.3	$	14.6
2022	22.4		0.5		22.9
2023	15.6		0.6		16.2
2024	10.6		0.6		11.2
2025	8.0		0.6		8.6
Thereafter	18.7		1.3		20.0
Total Lease Payments	$	89.6	$	3.9	$	93.5
Less: Interest	(14.4)		(0.7)		(15.1)
Present Value of Lease Liabilities	$	75.2	$	3.2	$	78.4

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SHAREHOLDERS' EQUITY (Tables)

6 Months Ended

Jul. 03, 2021

Stockholders' Equity Note [Abstract]

Schedule of Share-Based Compensation Activity

The following table presents share-based compensation activity for the six months ended July 3, 2021 and June 27, 2020 (in millions):

	July 3, 2021		June 27, 2020
Total Intrinsic Value of Share-Based Incentive Awards Exercised	$	6.7	$	3.1
Cash Received from Stock Option Exercises	0.1		0.2
Income Tax Benefit from the Exercise of SARs	0.5		0.4
Total Fair Value of Share-Based Incentive Awards Vested	3.9		1.8

Schedule of Share-based Payment Award, Valuation Assumptions

The following table presents assumptions used in the Company's Black-Scholes valuation related to grants of SARs:

	2021			2020
Per share weighted average fair value of grants	$	37.43		$	21.23
Risk-free interest rate	0.6		%	1.5		%
Expected life (years)	5.0			7.0
Expected volatility	32.5		%	25.2		%
Expected dividend yield	0.9		%	1.4		%

The assumptions used in the Company's Monte Carlo simulation were as follows:

	2021		2020
Risk-free interest rate	0.2	%	1.4	%
Expected life (years)	3.0		3.0
Expected volatility	37.0	%	24.0	%
Expected dividend yield	0.9	%	1.4	%

Summary of Share-Based Incentive Plan Grant Activity For SAR's

The following table presents a summary of share-based incentive plan grant activity for the six months ended July 3, 2021.

Number of Shares Under SARs	Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value (in millions)
Outstanding as of January 2, 2021	577,509	$	79.35	7.0	$	25.1
Granted	114,069	140.28
Exercised	(98,418)	75.97
Forfeited	(19,660)	85.81
Expired	(4,050)	72.29
Outstanding as of July 3, 2021	569,450	$	91.96	7.4	$	24.3
Exercisable as of July 3, 2021	242,394	$	76.02	5.9	$	13.9

Summary of RSA Award Activity

The following table presents a summary of RSA award activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested RSAs as of January 2, 2021	16,280	$	70.05	0.3
Granted	7,760	149.50
Vested	(16,280)	70.05
Unvested RSAs as of July 3, 2021	7,760	$	149.50	0.8

Summary of RSU Award Activity

The following table presents a summary of RSU award activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested RSUs as of January 2, 2021	164,398	$	81.16	1.7
Granted	48,280	136.98
Vested	(63,177)	79.19
Forfeited	(6,589)	83.78
Unvested RSUs as of July 3, 2021	142,912	$	100.12	2.1

Summary of PSU Award Activity

The following table presents a summary of PSU activity for the six months ended July 3, 2021:

	Shares	Weighted Average Fair Value at Grant Date		Weighted Average Remaining Contractual Term (Years)
Unvested PSUs as of January 2, 2021	87,522	$	97.59	1.8
Granted	33,125	122.36
Vested	(10,891)	91.65
Forfeited	(10,651)	78.88
Unvested PSUs as of July 3, 2021	99,105	$	109.68	1.9

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EARNINGS PER SHARE (Tables)

6 Months Ended

Jul. 03, 2021

Earnings Per Share [Abstract]

Schedule Of Reconciliation Of Basic And Diluted Shares Used in EPS

The following table reconciles the basic and diluted shares used in earnings per share calculations for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended		Six Months Ended
	July 3, 2021	June 27, 2020	July 3, 2021	June 27, 2020
Denominator for Basic Earnings Per Share	40.7	40.5	40.6	40.6
Effect of Dilutive Securities	0.3	0.2	0.4	0.1
Denominator for Diluted Earnings Per Share	41.0	40.7	41.0	40.7

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CONTINGENCIES (Tables)

6 Months Ended

Jul. 03, 2021

Commitments and Contingencies Disclosure [Abstract]

Schedule Of Accrued Warranty Costs

The following table presents a reconciliation of the changes in accrued warranty costs for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning Balance	$	16.3	$	15.4	$	15.5	$	15.1
Less: Payments	(4.2)		(3.3)		(8.7)		(6.9)
Provisions	4.6		3.5		10.0		7.5
Translation Adjustments	—		0.1		(0.1)		—
Ending Balance	$	16.7	$	15.7	$	16.7	$	15.7

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DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jul. 03, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Notional Amounts of Forward Contracts

As of July 3, 2021, the Company had the following currency forward contracts outstanding (with maturities extending through December 2022) to hedge forecasted foreign currency cash flows (in millions):

	Notional Amount (in US Dollars)
Chinese Renminbi	$	146.1
Mexican Peso	194.1
Euro	141.7
Indian Rupee	49.5
Canadian Dollar	1.0
Australian Dollar	20.3
British Pound	10.8
Thai Baht	5.7

As of July 3, 2021, the Company had the following commodity forward contracts outstanding (with maturities extending through December 2022) to hedge forecasted purchases of commodities (notional amounts expressed in terms of the dollar value of the hedged item (in millions)):

	Notional Amount
Copper	$	135.5
Aluminum	8.0

Schedule of Fair Values of Derivative Instruments

The following table presents the fair values of derivative instruments as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021
	Prepaid Expenses and Other Current Assets		Other Noncurrent Assets		Other Accrued Expenses		Other Noncurrent Liabilities
Designated as Hedging Instruments:
Interest Rate Swap Contracts	$	—	$	1.8	$	—	$	—
Currency Contracts	13.6		0.9		0.9		0.1
Commodity Contracts	16.3		1.1		1.4		0.5
Not Designated as Hedging Instruments:
Currency Contracts	—		—		0.3		—
Commodity Contracts	0.4		0.1		—		—
Total Derivatives	$	30.3	$	3.9	$	2.6	$	0.6

	January 2, 2021
	Prepaid Expenses and Other Current Assets		Other Noncurrent Assets		Other Accrued Expenses		Other Noncurrent Liabilities
Designated as Hedging Instruments:
Interest Rate Swap Contracts	$	—	$	—	$	0.7	$	1.4
Currency Contracts	16.4		1.6		1.0		0.1
Commodity Contracts	11.3		0.1		—		—
Not Designated as Hedging Instruments:
Currency Contracts	0.2		—		—		—
Commodity Contracts	0.1		—		—		—
Total Derivatives	$	28.0	$	1.7	$	1.7	$	1.5

Schedule of Cash Flow Hedging Instruments

The following table presents the effect of derivative instruments on the Condensed Consolidated Statements of Income and Condensed Consolidated Statement of Comprehensive Income (pre-tax) (in millions):

Derivatives Designated as Cash Flow Hedging Instruments

	Three Months Ended
	July 3, 2021								June 27, 2020
	Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total		Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	$	10.9	$	7.5	$	(0.9)	$	17.5	$	12.6	$	2.8	$	(0.5)	$	14.9
Amounts Reclassified from Other Comprehensive Income (Loss):
Loss recognized in Net Sales	—		—		—		—		—		(0.1)		—		(0.1)
Gain (Loss) Recognized in Cost of Sales	8.6		4.0		—		12.6		(0.9)		0.3		—		(0.6)
Loss Recognized in Operating Expenses	—		(1.3)		—		(1.3)		—		(1.6)		—		(1.6)
Gain Recognized in Interest Expense	—		—		—		—		—		—		0.2		0.2
	Six Months Ended
	July 3, 2021								June 27, 2020
	Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total		Commodity Forwards		Currency Forwards		Interest Rate Swaps		Total
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	$	25.0	$	7.7	$	4.0	$	36.7	$	(0.7)	$	(22.3)	$	(1.1)	$	(24.1)
Amounts Reclassified from Other Comprehensive Income (Loss):
Gain Recognized in Net Sales	—		0.1		—		0.1		—		—		—		—
Gain (Loss) Recognized in Cost of Sales	13.8		6.6		—		20.4		(2.0)		2.8		—		0.8
Gain (Loss) Recognized in Operating Expenses	—		2.2		—		2.2		—		(0.9)		—		(0.9)
Gain Recognized in Interest Expense	—		—		0.1		0.1		—		—		0.6		0.6

Derivatives Not Designated as Cash Flow Hedging Instruments (in millions):

	Three Months Ended
	July 3, 2021				June 27, 2020
	Commodity Forwards		Currency Forwards		Commodity Forwards		Currency Forwards
Gain recognized in Cost of Sales	$	0.2	$	—	$	0.1	$	—
Gain (Loss) recognized in Operating Expenses	—		(3.7)		—		2.1
	Six Months Ended
	July 3, 2021				June 27, 2020
	Commodity Forwards		Currency Forwards		Commodity Forwards		Currency Forwards
Gain recognized in Cost of Sales	$	0.4	$	—	$	—	$	—
Gain (Loss) recognized in Operating Expenses	—		2.1		—		(1.3)

Schedule of Derivatives Under Enforceable Master Netting Agreements

The following table presents the derivative assets and derivative liabilities presented on a net basis under enforceable master netting agreements (in millions):

	July 3, 2021
	Gross Amounts as Presented in the Condensed Consolidated Balance Sheet		Derivative Contract Amounts Subject to Right of Offset		Derivative Contracts as Presented on a Net Basis
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	13.6	$	(1.2)	$	12.4
Derivative Commodity Contracts	16.7		(1.4)		15.3
Other Noncurrent Assets:
Derivative Currency Contracts	0.9		—		0.9
Derivative Commodity Contracts	1.2		(0.4)		0.8
Other Accrued Expenses:
Derivative Currency Contracts	1.2		(1.2)		—
Derivative Commodity Contracts	1.4		(1.4)		—
Other Noncurrent Liabilities:
Derivative Currency Contracts	0.1		—		0.1
Derivative Commodity Contracts	0.5		(0.4)		0.1

	January 2, 2021
	Gross Amounts as Presented in the Condensed Consolidated Balance Sheet		Derivative Contract Amounts Subject to Right of Offset		Derivative Contracts as Presented on a Net Basis
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	16.6	$	(1.0)	$	15.6
Derivative Commodity Contracts	11.4		—		11.4
Other Noncurrent Assets:
Derivative Currency Contracts	1.6		—		1.6
Derivative Commodity Contracts	0.1		—		0.1
Other Accrued Expenses:
Derivative Currency Contracts	1.0		(1.0)		—
Other Noncurrent Liabilities:
Derivative Currency Contracts	0.1		—		0.1

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FAIR VALUE (Tables)

6 Months Ended

Jul. 03, 2021

Fair Value Disclosures [Abstract]

Schedule Of Financial Assets And Liabilities At Fair Value

The following table sets forth the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis as of July 3, 2021 and January 2, 2021 (in millions):

	July 3, 2021		January 2, 2021		Classification
Assets:
Prepaid Expenses and Other Current Assets:
Derivative Currency Contracts	$	13.6	$	16.6	Level 2
Derivative Commodity Contracts	16.7		11.4		Level 2
Other Noncurrent Assets:
Assets Held in Rabbi Trust	6.7		6.5		Level 1
Derivative Currency Contracts	0.9		1.6		Level 2
Derivative Commodity Contracts	1.2		0.1		Level 2
Interest Rate Swap	1.8		—		Level 2
Liabilities:
Other Accrued Expenses:
Interest Rate Swap	—		0.7		Level 2
Derivative Currency Contracts	1.2		1.0		Level 2
Derivative Commodity Contracts	1.4		—		Level 2
Other Noncurrent Liabilities:
Interest Rate Swap	—		1.4		Level 2
Derivative Currency Contracts	0.1		0.1		Level 2
Derivative Commodity Contracts	0.5		—		Level 2

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RESTRUCTURING ACTIVITIES (Tables)

6 Months Ended

Jul. 03, 2021

Restructuring and Related Activities [Abstract]

Schedule Of Restructuring Reserve

The following table presents a reconciliation of provisions and payments for the restructuring projects for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning Balance	$	2.7	$	2.4	$	2.0	$	0.9
Provision	1.5		7.8		3.2		12.9
Less: Payments/ Other	1.7		7.3		2.7		10.9
Ending Balance	$	2.5	$	2.9	$	2.5	$	2.9

Reconciliation Of Expenses By Type

The following table presents a reconciliation of restructuring and restructuring-related costs for restructuring projects for the three and six months ended July 3, 2021 and June 27, 2020, respectively (in millions):

	Three Months Ended
	July 3, 2021						June 27, 2020
Restructuring Costs:	Cost of Sales		Operating Expenses		Total		Cost of Sales		Operating Expenses		Total
Employee Termination Expenses	$	0.2	$	0.2	$	0.4	$	1.4	$	2.6	$	4.0
Facility Related Costs	0.8		0.1		0.9		3.2		0.4		3.6
Other Expenses	0.2		—		0.2		0.2		—		0.2
Total Restructuring Costs	$	1.2	$	0.3	$	1.5	$	4.8	$	3.0	$	7.8
	Six Months Ended
	July 3, 2021						June 27, 2020
Restructuring Costs:	Cost of Sales		Operating Expenses		Total		Cost of Sales		Operating Expenses		Total
Employee Termination Expenses	$	0.4	$	0.6	$	1.0	$	2.9	$	3.0	$	5.9
Facility Related Costs	1.6		0.3		1.9		5.9		0.8		6.7
Other Expenses	0.3		—		0.3		0.3		—		0.3
Total Restructuring Costs	$	2.3	$	0.9	$	3.2	$	9.1	$	3.8	$	12.9

The following table presents the allocation of restructuring and restructuring-related costs by segment for the three and six months ended July 3, 2021 and June 27, 2020 (in millions):

Restructuring Costs - Three Months Ended	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
July 3, 2021	$	1.5	$	0.1	$	0.3	$	0.3	$	0.8
June 27, 2020	$	7.8	$	2.3	$	2.0	$	1.3	$	2.2
Restructuring Costs - Six Months Ended	Total		Commercial Systems		Industrial Systems		Climate Solutions		Power Transmission Solutions
July 3, 2021	$	3.2	$	0.3	$	0.8	$	0.6	$	1.5
June 27, 2020	$	12.9	$	4.1	$	2.9	$	2.4	$	3.5

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OTHER FINANCIAL INFORMATION (Percentage Distribution Between Major Classes of Inventory) (Details)	6 Months Ended	12 Months Ended
	Jul. 03, 2021	Jan. 02, 2021
Inventory [Line Items]
Percentage of inventory cost using the LIFO method	48.10%	50.00%
Inventory Concentration Risk | Inventories | Raw Material and Work in Process
Inventory [Line Items]
Percentage of total Inventory	49.50%	48.70%
Inventory Concentration Risk | Inventories | Finished Goods and Purchased Parts
Inventory [Line Items]
Percentage of total Inventory	50.50%	51.30%

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OTHER FINANCIAL INFORMATION (Property, Plant, And Equipment By Major Classification) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020	Jan. 02, 2021
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment	$ 1,342.6		$ 1,342.6		$ 1,345.0
Less: Accumulated Depreciation	(808.5)		(808.5)		(789.5)
Net Property, Plant and Equipment	534.1		534.1		555.5
Asset Impairments	2.3	$ 2.8	2.3	$ 4.3
Land and Improvements
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment	74.9		74.9		76.1
Buildings and Improvements
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment	288.4		$ 288.4		290.7
Buildings and Improvements | Minimum
Property, Plant and Equipment [Line Items]
Useful life			3 years
Buildings and Improvements | Maximum
Property, Plant and Equipment [Line Items]
Useful life			50 years
Machinery and Equipment
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment	$ 979.3		$ 979.3		$ 978.2
Machinery and Equipment | Minimum
Property, Plant and Equipment [Line Items]
Useful life			3 years
Machinery and Equipment | Maximum
Property, Plant and Equipment [Line Items]
Useful life			15 years

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OTHER FINANCIAL INFORMATION (Narrative) (Details)	6 Months Ended
	Jul. 03, 2021 segment
Balance Sheet Related Disclosures [Abstract]
Number of operating segments	4
Payment terms	Payment terms vary by customer but typically range from due upon delivery to 120 days after delivery. For contracts recognized at a point in time, revenue and billing typically occur simultaneously.

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OTHER FINANCIAL INFORMATION (Disaggregation of Revenue) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Disaggregation of Revenue [Line Items]
Net Sales	$ 886.9	$ 634.1	$ 1,701.0	$ 1,368.3
Commercial Systems
Disaggregation of Revenue [Line Items]
Net Sales	269.3	175.9	506.3	375.3
Industrial Systems
Disaggregation of Revenue [Line Items]
Net Sales	145.2	120.6	281.6	250.2
Climate Solutions
Disaggregation of Revenue [Line Items]
Net Sales	257.3	178.2	496.4	388.3
Power Transmission Solutions
Disaggregation of Revenue [Line Items]
Net Sales	215.1	159.4	416.7	354.5
North America
Disaggregation of Revenue [Line Items]
Net Sales	649.9	463.7	1,248.6	1,025.5
North America | Commercial Systems
Disaggregation of Revenue [Line Items]
Net Sales	176.1	112.5	330.2	255.9
North America | Industrial Systems
Disaggregation of Revenue [Line Items]
Net Sales	73.9	69.2	145.0	142.1
North America | Climate Solutions
Disaggregation of Revenue [Line Items]
Net Sales	226.7	158.8	436.4	343.4
North America | Power Transmission Solutions
Disaggregation of Revenue [Line Items]
Net Sales	173.2	123.2	337.0	284.1
Asia
Disaggregation of Revenue [Line Items]
Net Sales	115.5	74.0	220.9	147.7
Asia | Commercial Systems
Disaggregation of Revenue [Line Items]
Net Sales	53.5	28.9	99.5	52.3
Asia | Industrial Systems
Disaggregation of Revenue [Line Items]
Net Sales	46.9	36.6	90.1	73.4
Asia | Climate Solutions
Disaggregation of Revenue [Line Items]
Net Sales	7.7	1.0	17.0	9.6
Asia | Power Transmission Solutions
Disaggregation of Revenue [Line Items]
Net Sales	7.4	7.5	14.3	12.4
Europe
Disaggregation of Revenue [Line Items]
Net Sales	74.3	69.9	143.6	143.1
Europe | Commercial Systems
Disaggregation of Revenue [Line Items]
Net Sales	26.7	25.5	51.4	54.0
Europe | Industrial Systems
Disaggregation of Revenue [Line Items]
Net Sales	12.1	14.7	23.7	27.9
Europe | Climate Solutions
Disaggregation of Revenue [Line Items]
Net Sales	10.4	7.5	19.9	15.1
Europe | Power Transmission Solutions
Disaggregation of Revenue [Line Items]
Net Sales	25.1	22.2	48.6	46.1
Rest-of-World
Disaggregation of Revenue [Line Items]
Net Sales	47.2	26.5	87.9	52.0
Rest-of-World | Commercial Systems
Disaggregation of Revenue [Line Items]
Net Sales	13.0	9.0	25.2	13.1
Rest-of-World | Industrial Systems
Disaggregation of Revenue [Line Items]
Net Sales	12.3	0.1	22.8	6.8
Rest-of-World | Climate Solutions
Disaggregation of Revenue [Line Items]
Net Sales	12.5	10.9	23.1	20.2
Rest-of-World | Power Transmission Solutions
Disaggregation of Revenue [Line Items]
Net Sales	$ 9.4	$ 6.5	$ 16.8	$ 11.9

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HELD FOR SALE, DIVESTITURES AND ACQUISITIONS (Assets Held For Sale) (Details) - USD ($)	Feb. 15, 2021	Jul. 03, 2021	Jan. 02, 2021
Business Acquisition [Line Items]
Assets Held for Sale		$ 7,500,000	$ 9,100,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Rexnord
Business Acquisition [Line Items]
Common stock, par value (in dollars per share)	$ 0.01
Rexnord | Minimum
Business Acquisition [Line Items]
Dividends	$ 0
Rexnord | Maximum
Business Acquisition [Line Items]
Dividends	$ 2,000,000,000.0

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	$ 2,617.8	$ 2,300.1	$ 2,577.0	$ 2,380.4
Other Comprehensive Income before Reclassifications	26.8	33.0	24.6	(62.8)
Tax Impact	(4.2)	(3.6)	(8.8)	5.8
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(10.8)	2.3	(21.9)	(0.2)
Tax Impact	2.6	(0.6)	5.3	0.0
Net Current Period Other Comprehensive Income	14.4	31.1	(0.8)	(57.2)
Ending Balance	2,696.5	2,347.0	2,696.5	2,347.0
Total
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(178.5)	(326.1)	(163.3)	(237.8)
Ending Balance	(164.1)	(295.0)	(164.1)	(295.0)
Hedging Activities
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	29.4	(23.6)	23.5	8.0
Other Comprehensive Income before Reclassifications	17.5	14.9	36.7	(24.1)
Tax Impact	(4.2)	(3.6)	(8.8)	5.8
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	(11.3)	2.1	(22.8)	(0.5)
Tax Impact	2.7	(0.5)	5.5	0.1
Net Current Period Other Comprehensive Income	4.7	12.9	10.6	(18.7)
Ending Balance	34.1	(10.7)	34.1	(10.7)
Pension and Post Retirement Benefit Adjustments
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(30.8)	(30.5)	(31.1)	(31.0)
Other Comprehensive Income before Reclassifications	0.0	(0.1)	0.0	0.3
Tax Impact	0.0	0.0	0.0	0.0
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	0.5	0.2	0.9	0.3
Tax Impact	(0.1)	(0.1)	(0.2)	(0.1)
Net Current Period Other Comprehensive Income	0.4	0.0	0.7	0.5
Ending Balance	(30.4)	(30.5)	(30.4)	(30.5)
Foreign Currency Translation Adjustments
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Beginning Balance	(177.1)	(272.0)	(155.7)	(214.8)
Other Comprehensive Income before Reclassifications	9.3	18.2	(12.1)	(39.0)
Tax Impact	0.0	0.0	0.0	0.0
Amounts Reclassified from Accumulated Other Comprehensive Income (Loss)	0.0	0.0	0.0	0.0
Tax Impact	0.0	0.0	0.0	0.0
Net Current Period Other Comprehensive Income	9.3	18.2	(12.1)	(39.0)
Ending Balance	$ (167.8)	$ (253.8)	$ (167.8)	$ (253.8)

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GOODWILL AND INTANGIBLE ASSETS (Narrative) (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Goodwill [Line Items]
Amortization of intangible assets	$ 11,100,000	$ 12,200,000	$ 22,300,000	$ 24,400,000
Estimated amortization expense remainder of year	43,300,000		43,300,000
Customer Relationships | Disposed of by sale | Hermetic Climate
Goodwill [Line Items]
Impairment of intangible assets	$ 0	$ 0	$ 0	$ 0

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GOODWILL AND INTANGIBLE ASSETS (Schedule Of Changes To Goodwill) (Details) $ in Millions	6 Months Ended
	Jul. 03, 2021 USD ($)
Goodwill [Roll Forward]
Beginning balance	$ 1,518.2
Translation Adjustments	(6.4)
Ending balance	1,511.8
Cumulative Goodwill Impairment Charges	295.7
Commercial Systems
Goodwill [Roll Forward]
Beginning balance	433.3
Translation Adjustments	(1.5)
Ending balance	431.8
Cumulative Goodwill Impairment Charges	183.2
Industrial Systems
Goodwill [Roll Forward]
Beginning balance	163.7
Translation Adjustments	(0.7)
Ending balance	163.0
Cumulative Goodwill Impairment Charges	72.1
Climate Solutions
Goodwill [Roll Forward]
Beginning balance	330.8
Translation Adjustments	(0.2)
Ending balance	330.6
Cumulative Goodwill Impairment Charges	17.2
Power Transmission Solutions
Goodwill [Roll Forward]
Beginning balance	590.4
Translation Adjustments	(4.0)
Ending balance	586.4
Cumulative Goodwill Impairment Charges	$ 23.2

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GOODWILL AND INTANGIBLE ASSETS (Schedule Of Intangible Assets) (Details) - USD ($) $ in Millions	3 Months Ended
	Jul. 03, 2021	Jan. 02, 2021
Finite-Lived Intangible Assets [Line Items]
Gross Value	$ 887.0	$ 892.6
Accumulated Amortization	504.5	485.1
Gross Value	122.4	122.8
Intangible Assets	1,009.4	1,015.4
Intangible Assets, Net of Amortization	$ 504.9	530.3
Customer Relationships
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (Years)	17 years
Gross Value	$ 704.1	708.6
Accumulated Amortization	$ 366.1	349.4
Technology
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (Years)	14 years
Gross Value	$ 145.9	146.3
Accumulated Amortization	$ 110.0	108.0
Trademarks
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period (Years)	14 years
Gross Value	$ 37.0	37.7
Accumulated Amortization	$ 28.4	$ 27.7

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GOODWILL AND INTANGIBLE ASSETS (Schedule Of Estimated Amortization) (Details) $ in Millions	Jul. 03, 2021 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Estimated Amortization, 2022	$ 41.5
Estimated Amortization, 2023	41.5
Estimated Amortization, 2024	40.9
Estimated Amortization, 2025	38.8
Estimated Amortization, 2026	$ 35.3

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SEGMENT INFORMATION (Details) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021 USD ($)	Jun. 27, 2020 USD ($)	Jul. 03, 2021 USD ($) segment	Jun. 27, 2020 USD ($)	Jan. 02, 2021 USD ($)
Segment Reporting Information [Line Items]
Number of operating segments | segment			4
Total Sales	$ 886.9	$ 634.1	$ 1,701.0	$ 1,368.3
Gross Profit	251.5	170.3	496.9	373.6
Operating Expenses	140.2	121.6	288.5	253.5
Gain on Divestitures	0.0	0.0	0.0	(0.1)
Asset Impairments	2.3	2.8	2.3	4.3
Total Operating Expenses	142.5	124.4	290.8	257.7
Income from Operations	109.0	45.9	206.1	115.9
Depreciation and Amortization	30.5	33.3	62.3	65.9
Capital Expenditures	13.6	9.5	24.3	20.4
Assets	4,773.7		4,773.7		$ 4,589.0
Commercial Systems
Segment Reporting Information [Line Items]
Total Sales	269.3	175.9	506.3	375.3
Assets	1,390.5		1,390.5		1,319.6
Industrial Systems
Segment Reporting Information [Line Items]
Total Sales	145.2	120.6	281.6	250.2
Assets	870.2		870.2		837.5
Climate Solutions
Segment Reporting Information [Line Items]
Total Sales	257.3	178.2	496.4	388.3
Assets	966.1		966.1		890.4
Power Transmission Solutions
Segment Reporting Information [Line Items]
Total Sales	215.1	159.4	416.7	354.5
Assets	1,546.9		1,546.9		$ 1,541.5
Intersegment Eliminations
Segment Reporting Information [Line Items]
Total Sales	33.1	30.5	59.3	54.2
Intersegment Eliminations | Commercial Systems
Segment Reporting Information [Line Items]
Total Sales	(19.9)	(16.9)	(37.4)	(28.7)
Intersegment Eliminations | Industrial Systems
Segment Reporting Information [Line Items]
Total Sales	(7.3)	(9.1)	(11.0)	(15.8)
Intersegment Eliminations | Climate Solutions
Segment Reporting Information [Line Items]
Total Sales	(5.1)	(3.9)	(9.4)	(8.4)
Intersegment Eliminations | Power Transmission Solutions
Segment Reporting Information [Line Items]
Total Sales	(0.8)	(0.6)	(1.5)	(1.3)
Operating Segments | Commercial Systems
Segment Reporting Information [Line Items]
Total Sales	289.2	192.8	543.7	404.0
Gross Profit	67.5	42.4	133.0	92.7
Operating Expenses	40.3	34.2	78.3	71.7
Gain on Divestitures				(0.1)
Asset Impairments	1.8	2.0	1.8	2.8
Total Operating Expenses	42.1	36.2	80.1	74.4
Income from Operations	25.4	6.2	52.9	18.3
Depreciation and Amortization	7.8	8.3	15.6	16.6
Capital Expenditures	4.5	2.2	7.8	5.3
Operating Segments | Industrial Systems
Segment Reporting Information [Line Items]
Total Sales	152.5	129.7	292.6	266.0
Gross Profit	26.2	24.9	53.0	47.9
Operating Expenses	23.1	21.7	46.2	44.6
Gain on Divestitures				0.0
Asset Impairments	0.0	0.0	0.0	0.2
Total Operating Expenses	23.1	21.7	46.2	44.8
Income from Operations	3.1	3.2	6.8	3.1
Depreciation and Amortization	5.7	6.0	11.6	11.9
Capital Expenditures	3.3	2.3	5.7	4.3
Operating Segments | Climate Solutions
Segment Reporting Information [Line Items]
Total Sales	262.4	182.1	505.8	396.7
Gross Profit	74.0	47.4	148.0	106.8
Operating Expenses	27.0	26.6	57.7	56.0
Gain on Divestitures				0.0
Asset Impairments	0.5	0.8	0.5	1.3
Total Operating Expenses	27.5	27.4	58.2	57.3
Income from Operations	46.5	20.0	89.8	49.5
Depreciation and Amortization	3.6	5.0	8.1	9.7
Capital Expenditures	3.0	2.6	6.2	6.2
Operating Segments | Power Transmission Solutions
Segment Reporting Information [Line Items]
Total Sales	215.9	160.0	418.2	355.8
Gross Profit	83.8	55.6	162.9	126.2
Operating Expenses	49.8	39.1	106.3	81.2
Gain on Divestitures				0.0
Asset Impairments	0.0	0.0	0.0	0.0
Total Operating Expenses	49.8	39.1	106.3	81.2
Income from Operations	34.0	16.5	56.6	45.0
Depreciation and Amortization	13.4	14.0	27.0	27.7
Capital Expenditures	$ 2.8	$ 2.4	$ 4.6	$ 4.6

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DEBT AND BANK CREDIT FACILITIES (Schedule Of Indebtedness) (Details) - USD ($) $ in Millions	Jul. 03, 2021	Jan. 02, 2021
Debt Instrument [Line Items]
Less: Debt Issuance Costs	$ (4.4)	$ (3.2)
Total	1,019.9	1,071.4
Less: Current Maturities	230.9	231.0
Long-Term Debt	789.0	840.4
Term Facility
Debt Instrument [Line Items]
Long-term debt, gross	620.0	670.0
Senior Notes
Debt Instrument [Line Items]
Long-term debt, gross	400.0	400.0
Other
Debt Instrument [Line Items]
Long-term debt, gross	$ 4.3	$ 4.6

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DEBT AND BANK CREDIT FACILITIES (Narrative) (Details)			3 Months Ended		6 Months Ended
	Feb. 15, 2021 USD ($)	Aug. 27, 2018 USD ($)	Jul. 03, 2021 USD ($)	Jun. 27, 2020 USD ($)	Jul. 03, 2021 USD ($) tranche	Jun. 27, 2020 USD ($)	Mar. 17, 2021 USD ($)	Mar. 16, 2021 USD ($)	Jan. 02, 2021 USD ($)
Debt Instrument [Line Items]
Long-term debt			$ 1,019,900,000		$ 1,019,900,000				$ 1,071,400,000
Fair value of debt			1,031,100,000		1,031,100,000				1,085,800,000
Term Facility
Debt Instrument [Line Items]
Principal amount		$ 900,000,000.0
Debt instrument term		5 years
Amortization rate per annum		5.00%
Amortization rate, after two years		7.50%
Amortization rate, last two years		10.00%
Percent of certain cash proceeds received for required prepayment		100.00%
Long-term debt, gross			620,000,000.0		620,000,000.0				670,000,000.0
Multicurrency Revolving Facility
Debt Instrument [Line Items]
Principal amount		$ 500,000,000.0
Debt instrument term		5 years
Senior Notes
Debt Instrument [Line Items]
Long-term debt, gross			400,000,000.0		400,000,000.0				400,000,000.0
Other
Debt Instrument [Line Items]
Long-term debt, gross			$ 4,300,000		$ 4,300,000				$ 4,600,000
Weighted average interest rate			4.90%		4.90%				4.90%
Bridge Loan
Debt Instrument [Line Items]
Principal amount	$ 2,100,000,000
Debt instrument term	364 days
Additional commitment							$ 250,000,000.0
Letter of Credit
Debt Instrument [Line Items]
Principal amount		$ 50,000,000.0
Amended and Restated Credit Agreement | Term Facility
Debt Instrument [Line Items]
Principal amount							2,100,000,000
Multicurrency Revolving Facility
Debt Instrument [Line Items]
Principal amount		$ 750,000,000.0					$ 750,000,000.0	$ 500,000,000.0
Consolidated Fund Debt To EBITDA Ratio							3.00	4.50
Multicurrency Revolving Facility | Term Facility
Debt Instrument [Line Items]
Available borrowing capacity			$ 749,800,000		$ 749,800,000
Multicurrency Revolving Facility | Line of Credit
Debt Instrument [Line Items]
Borrowings under line of credit			0		0
Multicurrency Revolving Facility | Letter of Credit | Term Facility
Debt Instrument [Line Items]
Borrowings under line of credit			200,000		200,000
2011 Notes | Senior Notes
Debt Instrument [Line Items]
Senior notes			400,000,000.0		$ 400,000,000.0
Number of tranches in private placement | tranche					5
2011 Notes | Minimum | Senior Notes
Debt Instrument [Line Items]
Debt instrument term					10 years
2011 Notes | Maximum | Senior Notes
Debt Instrument [Line Items]
Debt instrument term					12 years
Backstop Commitment Letter | Bridge Loan
Debt Instrument [Line Items]
Principal amount	$ 1,100,000,000
Land Commitment Letter | Bridge Loan
Debt Instrument [Line Items]
Principal amount	$ 487,000,000.0
Fixed Rate Series 2011A, Maturing 2021 | Senior Notes
Debt Instrument [Line Items]
Long-term debt, gross			230,000,000.0		$ 230,000,000.0
Fixed Rate Series 2011A, Maturing 2023 | Senior Notes
Debt Instrument [Line Items]
Long-term debt, gross			$ 170,000,000.0		$ 170,000,000.0
Emerson Electric Co. | Term Facility
Debt Instrument [Line Items]
Weighted average interest rate, over time			1.40%	1.60%	1.50%	2.90%
Emerson Electric Co. | Multicurrency Revolving Facility | Line of Credit
Debt Instrument [Line Items]
Weighted average interest rate, over time			1.40%	1.90%	1.40%	2.40%
Average daily balance			$ 2,400,000	$ 408,700,000	$ 4,900,000	$ 258,800,000

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DEBT AND BANK CREDIT FACILITIES (Details On The Senior Notes) (Details) - USD ($) $ in Millions	Jul. 03, 2021	Jan. 02, 2021
Fixed Rate Series 2011A, Maturing 2021 | Minimum
Debt Instrument [Line Items]
Debt instrument interest rate (percent)	4.80%
Fixed Rate Series 2011A, Maturing 2021 | Maximum
Debt Instrument [Line Items]
Debt instrument interest rate (percent)	5.00%
Fixed Rate Series 2011A, Maturing 2023 | Minimum
Debt Instrument [Line Items]
Debt instrument interest rate (percent)	4.90%
Fixed Rate Series 2011A, Maturing 2023 | Maximum
Debt Instrument [Line Items]
Debt instrument interest rate (percent)	5.10%
Senior Notes
Debt Instrument [Line Items]
Principal	$ 400.0	$ 400.0
Senior Notes | Fixed Rate Series 2011A, Maturing 2021
Debt Instrument [Line Items]
Principal	230.0
Senior Notes | Fixed Rate Series 2011A, Maturing 2023
Debt Instrument [Line Items]
Principal	$ 170.0

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RETIREMENT AND POST RETIREMENT HEALTH CARE PLANS (Schedule Of Net Periodic Defined Benefit Pension Cost) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract]
Service Cost	$ 0.3	$ 0.3	$ 0.6	$ 1.1
Interest Cost	1.4	2.0	2.9	4.1
Expected Return on Plan Assets	(3.1)	(3.3)	(6.2)	(6.6)
Amortization of Prior Service Cost and Net Actuarial Loss	0.5	0.2	0.9	0.3
Net Periodic Benefit Income	$ (0.9)	$ (0.8)	$ (1.8)	$ (1.1)

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RETIREMENT AND POST RETIREMENT HEALTH CARE PLANS (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020	Jan. 02, 2021
Pension and Other Postretirement Benefits Cost (Reversal of Cost) [Abstract]
Contribution to defined benefit pension plans	$ 1.6	$ 1.2	$ 2.8	$ 2.3	$ 8.5
Expected total contribution to defined benefit pension plans	$ 5.8		$ 5.8

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LEASES (Narrative) (Details) $ in Millions	6 Months Ended
	Jul. 03, 2021 USD ($) option
Lessee, Lease, Description [Line Items]
Number of options to renew | option	1
Operating lease, not yet commenced | $	$ 5.8
Minimum
Lessee, Lease, Description [Line Items]
Lessee, renewal term	1 year
Maximum
Lessee, Lease, Description [Line Items]
Lessee, renewal term	25 years

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LEASES (Lease Cost) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Leases [Abstract]
Operating Lease Cost	$ 7.7	$ 7.6	$ 15.4	$ 15.3
Finance Lease Cost:
Amortization of ROU Assets	0.1	0.1	0.2	0.2
Interest on Lease Liabilities	0.1	0.0	0.1	0.1
Total Lease Expense	$ 7.9	$ 7.7	$ 15.7	$ 15.6

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LEASES (Lease Maturities) (Details) $ in Millions	Jul. 03, 2021 USD ($)
Operating Leases
Remainder of 2021	$ 14.3
2022	22.4
2023	15.6
2024	10.6
2025	8.0
Thereafter	18.7
Total Lease Payments	89.6
Less: Interest	(14.4)
Present Value of Lease Liabilities	75.2
Finance Leases
Remainder of 2021	0.3
2022	0.5
2023	0.6
2024	0.6
2025	0.6
Thereafter	1.3
Total Lease Payments	3.9
Less: Interest	(0.7)
Present Value of Lease Liabilities	3.2
Total
Remainder of 2021	14.6
2022	22.9
2023	16.2
2024	11.2
2025	8.6
Thereafter	20.0
Total Lease Payments	93.5
Less: Interest	(15.1)
Present Value of Lease Liabilities	$ 78.4

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LEASES (Supplemental Information) (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020
Leases [Abstract]
Operating Cash Flows Used For Operating Leases	$ 12.4	$ 14.8
Operating Cash Flows Used For Finance Leases	0.1	0.1
Financing Cash Flows Used For Finance Leases	0.2	0.2
Leased Assets Obtained in Exchange for New Operating Lease Liabilities	$ 9.7	$ 18.3
Weighted Average Remaining Lease Term
Operating Leases	4 years 4 months 24 days	5 years 2 months 12 days
Finance Leases	6 years 9 months 18 days	7 years 9 months 18 days
Weighted Average Discount Rate
Operating Leases	6.70%	8.30%
Finance Leases	5.90%	5.90%

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SHAREHOLDERS' EQUITY (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020	Jan. 02, 2021	Oct. 25, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock repurchase program, authorized amount						$ 250.0
Stock repurchased and retired (in shares)				315,072
Shares repurchased (in dollars per share)				$ 79.38
Stock repurchased and retired				$ 25.0
Remaining shares to be repurchased (in shares)	210,000,000.0		210,000,000.0
Compensation expense	$ 4.5	$ 2.8	$ 7.8	5.5
Excess income tax benefit recognized related to share-based compensation	0.7	$ 0.2	1.3	$ 0.4
Unrecognized compensation cost	$ 25.1		$ 25.1
Weighted average period of recognition	2 years
Number of shares available for grant	1,600,000		1,600,000
SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense			$ 2.2
Weighted average period of recognition	2 years 4 months 24 days
Award expiration period			10 years
Compensation expense not yet recognized	$ 7.6		$ 7.6
Restricted Stock Awards (RSAs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense			$ 0.6
Weighted average period of recognition			9 months 18 days
Compensation expense not yet recognized	1.0		$ 1.0
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense			$ 3.3
Weighted average period of recognition			2 years 1 month 6 days
Compensation expense not yet recognized	10.0		$ 10.0
Performance Share Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense			$ 1.7
Weighted average period of recognition			1 year 10 months 24 days
Award vesting period			3 years
Compensation expense not yet recognized	$ 6.5		$ 6.5
Performance target percentage, payout			100.00%
Performance period			3 years
Minimum | Performance Share Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance target percentage, payout			0.00%
Maximum | Performance Share Units (PSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Performance target percentage, payout			200.00%
Tranche one | SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period					5 years
Tranche one | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			33.00%
Tranche two | SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period					3 years
Tranche two | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			33.00%
Tranche three | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage			33.00%

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SHAREHOLDERS' EQUITY (Schedule Of Share-Based Compensation Activity) (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020
Stockholders' Equity Note [Abstract]
Total Intrinsic Value of Share-Based Incentive Awards Exercised	$ 6.7	$ 3.1
Cash Received from Stock Option Exercises	0.1	0.2
Income Tax Benefit from the Exercise of SARs	0.5	0.4
Total Fair Value of Share-Based Incentive Awards Vested	$ 3.9	$ 1.8

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SHAREHOLDERS' EQUITY (Schedule Of Assumptions Used In Black-Scholes Valuation For Options and SAR's) (Details) - SARs - $ / shares	6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Per share weighted average fair value of grants (in dollars per share)	$ 37.43	$ 21.23
Risk-free interest rate	0.60%	1.50%
Expected life (years)	5 years	7 years
Expected volatility	32.50%	25.20%
Expected dividend yield	0.90%	1.40%

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SHAREHOLDERS' EQUITY (Summary Of Share-Based Incentive Plan Grant Activity For Options and SAR's) (Details) - SARs - USD ($) $ / shares in Units, $ in Millions	3 Months Ended	6 Months Ended	12 Months Ended
	Jul. 03, 2021	Jul. 03, 2021	Jan. 02, 2021
Shares
Outstanding (in shares)		577,509
Granted (in shares)		114,069
Exercised (in shares)		(98,418)
Forfeited (in shares)		(19,660)
Expired (in shares)	(4,050)
Outstanding (in shares)	569,450	569,450	577,509
Exercisable (in shares)	242,394	242,394
Weighted Average Exercise Price
Outstanding, weighted average exercise price (in dollars per share)		$ 79.35
Granted, weighted average exercise price (in dollars per share)		140.28
Exercised, weighted average exercise price (in dollars per share)		75.97
Forfeited, weighted average exercise price (in dollars per share)		85.81
Expired, weighted average exercise price (in dollars per share)	$ 72.29
Outstanding, weighted average exercise price (in dollars per share)	91.96	91.96	$ 79.35
Exercisable, weighted average exercise price (in dollars per share)	$ 76.02	$ 76.02
Outstanding, weighted average remaining contractual term		7 years 4 months 24 days	7 years
Exercisable, weighted average remaining contractual term		5 years 10 months 24 days
Outstanding, aggregate intrinsic value	$ 24.3	$ 24.3	$ 25.1
Exercisable, aggregate intrinsic value	$ 13.9	$ 13.9

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SHAREHOLDERS' EQUITY (Summary Of RSA Award Activity) (Details) - Restricted Stock Awards (RSAs) - $ / shares	3 Months Ended	6 Months Ended	12 Months Ended
	Jul. 03, 2021	Jul. 03, 2021	Jan. 02, 2021
Shares
Unvested (in shares)		16,280
Granted (in shares)	7,760
Vested (in shares)	(16,280)
Unvested (in shares)	7,760	7,760	16,280
Weighted Average Fair Value at Grant Date
Unvested, weighted average fair value at grant date (in dollars per share)		$ 70.05
Granted, weighted average fair value at grant date (in dollars per share)	$ 149.50
Vested, weighted average fair value at grant date (in dollars per share)	70.05
Unvested, weighted average fair value at grant date (in dollars per share)	$ 149.50	$ 149.50	$ 70.05
Unvested, weighted average remaining contractual term		9 months 18 days	3 months 18 days

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SHAREHOLDERS' EQUITY (Summary Of RSU Award Activity) (Details) - Restricted Stock Units (RSUs) - $ / shares	6 Months Ended	12 Months Ended
	Jul. 03, 2021	Jan. 02, 2021
Shares
Unvested (in shares)	164,398
Granted (in shares)	48,280
Vested (in shares)	(63,177)
Forfeited (in shares)	(6,589)
Unvested (in shares)	142,912	164,398
Weighted Average Fair Value at Grant Date
Unvested, weighted average fair value at grant date (in dollars per share)	$ 81.16
Granted, weighted average fair value at grant date (in dollars per share)	136.98
Vested, weighted average fair value at grant date (in dollars per share)	79.19
Forfeited, weighted average fair value at grant date (in dollars per share)	83.78
Unvested, weighted average fair value at grant date (in dollars per share)	$ 100.12	$ 81.16
Unvested, weighted average remaining contractual term	2 years 1 month 6 days	1 year 8 months 12 days

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SHAREHOLDERS' EQUITY (Schedule Of Assumptions Used In Monte Carlo Simulation For Performance Share Units) (Details) - Performance Share Units (PSUs)	6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-free interest rate	0.20%	1.40%
Expected life (years)	3 years	3 years
Expected volatility	37.00%	24.00%
Expected dividend yield	0.90%	1.40%

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SHAREHOLDERS' EQUITY (Summary Of PSU Award Activity) (Details) - Performance Share Units (PSUs) - $ / shares	3 Months Ended	6 Months Ended	12 Months Ended
	Jul. 03, 2021	Jul. 03, 2021	Jan. 02, 2021
Shares
Unvested (in shares)		87,522
Granted (in shares)		33,125
Vested (in shares)	(10,891)
Forfeited (in shares)		(10,651)
Unvested (in shares)	99,105	99,105	87,522
Weighted Average Fair Value at Grant Date
Unvested, weighted average fair value at grant date (in dollars per share)		$ 97.59
Granted, weighted average fair value at grant date (in dollars per share)		122.36
Vested, weighted average fair value at grant date (in dollars per share)	$ 91.65
Forfeited, weighted average fair value at grant date (in dollars per share)		78.88
Unvested, weighted average fair value at grant date (in dollars per share)	$ 109.68	$ 109.68	$ 97.59
Unvested, weighted average remaining contractual term		1 year 10 months 24 days	1 year 9 months 18 days

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INCOME TAXES (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020	Jan. 02, 2021
Income Tax Disclosure [Abstract]
Effective tax rate	19.10%	22.50%	21.00%	22.80%
Unrecognized tax benefits	$ 9.3		$ 9.3		$ 6.8
Accrued interest	$ 2.9		$ 2.9		$ 2.7

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EARNINGS PER SHARE (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Earnings Per Share [Abstract]
Shares excluded from the calculation of the effect of dilutive securities (in shares)	0.1	0.6	0.1	0.5
Weighted Average Number of Shares Outstanding Reconciliation [Abstract]
Denominator for Basic Earnings Per Share (in shares)	40.7	40.5	40.6	40.6
Effect of Dilutive Securities (in shares)	0.3	0.2	0.4	0.1
Denominator for Diluted Earnings Per Share (in shares)	41.0	40.7	41.0	40.7

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CONTINGENCIES (Details) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021 USD ($)	Jun. 27, 2020 USD ($)	Jul. 03, 2021 USD ($) subsidiary	Jun. 27, 2020 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Number of subsidiaries involved in litigation | subsidiary			1
Movement in Standard Product Warranty Accrual [Roll Forward]
Beginning Balance	$ 16.3	$ 15.4	$ 15.5	$ 15.1
Less: Payments	(4.2)	(3.3)	(8.7)	(6.9)
Provisions	4.6	3.5	10.0	7.5
Translation Adjustments	0.0	0.1	(0.1)	0.0
Ending Balance	$ 16.7	$ 15.7	$ 16.7	$ 15.7

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DERIVATIVE FINANCIAL INSTRUMENTS (Narrative) (Details)	6 Months Ended	12 Months Ended
	Jul. 03, 2021 USD ($)	Jan. 02, 2021 USD ($)	Jun. 27, 2020 derivative_instrument	Apr. 30, 2018 USD ($)
Derivative [Line Items]
Derivative gains, net of tax	$ 10,700,000	$ 3,700,000
Net AOCI hedging component	34,100,000
Net current deferred losses expected to be realized in the next twelve months	20,900,000
Receive-variable/pay-fixed interest rate swap
Derivative [Line Items]
Notional amount of instrument				$ 88,400,000
Forward Contracts
Derivative [Line Items]
Notional amount of instrument	$ 250,000,000.0
Number of derivative instruments | derivative_instrument			2

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DERIVATIVE FINANCIAL INSTRUMENTS (Schedule Of Notional Amounts Of Forward Contracts) (Details)	Jul. 03, 2021 USD ($)
Forward Contracts
Derivative [Line Items]
Notional Amount (in US Dollars)	$ 250,000,000.0
Forward Contracts | Chinese Renminbi
Derivative [Line Items]
Notional Amount (in US Dollars)	146,100,000
Forward Contracts | Mexican Peso
Derivative [Line Items]
Notional Amount (in US Dollars)	194,100,000
Forward Contracts | Euro
Derivative [Line Items]
Notional Amount (in US Dollars)	141,700,000
Forward Contracts | Indian Rupee
Derivative [Line Items]
Notional Amount (in US Dollars)	49,500,000
Forward Contracts | Canadian Dollar
Derivative [Line Items]
Notional Amount (in US Dollars)	1,000,000.0
Forward Contracts | Australian Dollar
Derivative [Line Items]
Notional Amount (in US Dollars)	20,300,000
Forward Contracts | British Pound
Derivative [Line Items]
Notional Amount (in US Dollars)	10,800,000
Forward Contracts | Thai Baht
Derivative [Line Items]
Notional Amount (in US Dollars)	5,700,000
Commodity Contracts | Copper
Derivative [Line Items]
Notional Amount (in US Dollars)	135,500,000
Commodity Contracts | Aluminum
Derivative [Line Items]
Notional Amount (in US Dollars)	$ 8,000,000.0

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DERIVATIVE FINANCIAL INSTRUMENTS (Schedule Of Fair Values Of Derivative Instruments) (Details) - USD ($) $ in Millions	Jul. 03, 2021	Jan. 02, 2021
Prepaid Expenses and Other Current Assets
Derivative [Line Items]
Derivative asset	$ 30.3	$ 28.0
Prepaid Expenses and Other Current Assets | Currency Contracts
Derivative [Line Items]
Derivative asset	13.6	16.6
Prepaid Expenses and Other Current Assets | Commodity Contracts
Derivative [Line Items]
Derivative asset	16.7	11.4
Other Noncurrent Assets
Derivative [Line Items]
Derivative asset	3.9	1.7
Other Noncurrent Assets | Currency Contracts
Derivative [Line Items]
Derivative asset	0.9	1.6
Other Noncurrent Assets | Commodity Contracts
Derivative [Line Items]
Derivative asset	1.2	0.1
Other Accrued Expenses
Derivative [Line Items]
Derivative liability	2.6	1.7
Other Accrued Expenses | Currency Contracts
Derivative [Line Items]
Derivative liability	1.2	1.0
Other Accrued Expenses | Commodity Contracts
Derivative [Line Items]
Derivative liability	1.4
Other Noncurrent Liabilities
Derivative [Line Items]
Derivative liability	0.6	1.5
Other Noncurrent Liabilities | Currency Contracts
Derivative [Line Items]
Derivative liability	0.1	0.1
Other Noncurrent Liabilities | Commodity Contracts
Derivative [Line Items]
Derivative liability	0.5
Designated as Hedging Instruments: | Prepaid Expenses and Other Current Assets | Interest Rate Swap Contracts
Derivative [Line Items]
Derivative asset	0.0	0.0
Designated as Hedging Instruments: | Prepaid Expenses and Other Current Assets | Currency Contracts
Derivative [Line Items]
Derivative asset	13.6	16.4
Designated as Hedging Instruments: | Prepaid Expenses and Other Current Assets | Commodity Contracts
Derivative [Line Items]
Derivative asset	16.3	11.3
Designated as Hedging Instruments: | Other Noncurrent Assets | Interest Rate Swap Contracts
Derivative [Line Items]
Derivative asset	1.8	0.0
Designated as Hedging Instruments: | Other Noncurrent Assets | Currency Contracts
Derivative [Line Items]
Derivative asset	0.9	1.6
Designated as Hedging Instruments: | Other Noncurrent Assets | Commodity Contracts
Derivative [Line Items]
Derivative asset	1.1	0.1
Designated as Hedging Instruments: | Other Accrued Expenses | Interest Rate Swap Contracts
Derivative [Line Items]
Derivative liability	0.0	0.7
Designated as Hedging Instruments: | Other Accrued Expenses | Currency Contracts
Derivative [Line Items]
Derivative liability	0.9	1.0
Designated as Hedging Instruments: | Other Accrued Expenses | Commodity Contracts
Derivative [Line Items]
Derivative liability	1.4	0.0
Designated as Hedging Instruments: | Other Noncurrent Liabilities | Interest Rate Swap Contracts
Derivative [Line Items]
Derivative liability	0.0	1.4
Designated as Hedging Instruments: | Other Noncurrent Liabilities | Currency Contracts
Derivative [Line Items]
Derivative liability	0.1	0.1
Designated as Hedging Instruments: | Other Noncurrent Liabilities | Commodity Contracts
Derivative [Line Items]
Derivative liability	0.5	0.0
Not Designated as Hedging Instruments: | Prepaid Expenses and Other Current Assets | Currency Contracts
Derivative [Line Items]
Derivative asset	0.0	0.2
Not Designated as Hedging Instruments: | Prepaid Expenses and Other Current Assets | Commodity Contracts
Derivative [Line Items]
Derivative asset	0.4	0.1
Not Designated as Hedging Instruments: | Other Noncurrent Assets | Currency Contracts
Derivative [Line Items]
Derivative asset	0.0	0.0
Not Designated as Hedging Instruments: | Other Noncurrent Assets | Commodity Contracts
Derivative [Line Items]
Derivative asset	0.1	0.0
Not Designated as Hedging Instruments: | Other Accrued Expenses | Currency Contracts
Derivative [Line Items]
Derivative liability	0.3	0.0
Not Designated as Hedging Instruments: | Other Accrued Expenses | Commodity Contracts
Derivative [Line Items]
Derivative liability	0.0	0.0
Not Designated as Hedging Instruments: | Other Noncurrent Liabilities | Currency Contracts
Derivative [Line Items]
Derivative liability	0.0	0.0
Not Designated as Hedging Instruments: | Other Noncurrent Liabilities | Commodity Contracts
Derivative [Line Items]
Derivative liability	$ 0.0	$ 0.0

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DERIVATIVE FINANCIAL INSTRUMENTS (Schedule Of Cash Flow Hedging Instruments) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020	Jan. 02, 2021
Derivative [Line Items]
Gain (Loss) Recognized in Other Comprehensive Income (Loss)			$ 10.7		$ 3.7
Cash Flow Hedging | Designated as Hedging Instruments:
Derivative [Line Items]
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	$ 17.5	$ 14.9	36.7	$ (24.1)
Cash Flow Hedging | Designated as Hedging Instruments: | Net sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	(0.1)	0.1	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Cost of Sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	12.6	(0.6)	20.4	0.8
Cash Flow Hedging | Designated as Hedging Instruments: | Operating expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	(1.3)	(1.6)	2.2	(0.9)
Cash Flow Hedging | Designated as Hedging Instruments: | Interest expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.2	0.1	0.6
Cash Flow Hedging | Designated as Hedging Instruments: | Commodity Forwards
Derivative [Line Items]
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	10.9	12.6	25.0	(0.7)
Cash Flow Hedging | Designated as Hedging Instruments: | Commodity Forwards | Net sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Commodity Forwards | Cost of Sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	8.6	(0.9)	13.8	(2.0)
Cash Flow Hedging | Designated as Hedging Instruments: | Commodity Forwards | Operating expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Commodity Forwards | Interest expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Currency Forwards
Derivative [Line Items]
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	7.5	2.8	7.7	(22.3)
Cash Flow Hedging | Designated as Hedging Instruments: | Currency Forwards | Net sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	(0.1)	0.1	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Currency Forwards | Cost of Sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	4.0	0.3	6.6	2.8
Cash Flow Hedging | Designated as Hedging Instruments: | Currency Forwards | Operating expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	(1.3)	(1.6)	2.2	(0.9)
Cash Flow Hedging | Designated as Hedging Instruments: | Currency Forwards | Interest expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Interest Rate Swaps
Derivative [Line Items]
Gain (Loss) Recognized in Other Comprehensive Income (Loss)	(0.9)	(0.5)	4.0	(1.1)
Cash Flow Hedging | Designated as Hedging Instruments: | Interest Rate Swaps | Net sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Interest Rate Swaps | Cost of Sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Interest Rate Swaps | Operating expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Designated as Hedging Instruments: | Interest Rate Swaps | Interest expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.2	0.1	0.6
Cash Flow Hedging | Not Designated as Hedging Instruments: | Commodity Forwards | Cost of Sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.2	0.1	0.4	0.0
Cash Flow Hedging | Not Designated as Hedging Instruments: | Commodity Forwards | Operating expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Not Designated as Hedging Instruments: | Currency Forwards | Cost of Sales
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	0.0	0.0	0.0	0.0
Cash Flow Hedging | Not Designated as Hedging Instruments: | Currency Forwards | Operating expense
Derivative [Line Items]
Amounts Reclassified from Other Comprehensive Income (Loss):	$ (3.7)	$ 2.1	$ 2.1	$ (1.3)

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DERIVATIVE FINANCIAL INSTRUMENTS (Schedule Of Derivatives Under Enforceable Master Netting Agreements) (Details) - USD ($) $ in Millions	Jul. 03, 2021	Jan. 02, 2021
Prepaid Expenses and Other Current Assets
Derivative [Line Items]
Derivative Asset, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	$ 30.3	$ 28.0
Prepaid Expenses and Other Current Assets | Currency Contracts
Derivative [Line Items]
Derivative Asset, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	13.6	16.6
Derivative Asset, Derivative Contract Amounts Subject to Right of Offset	(1.2)	(1.0)
Derivative Asset, Derivative Contracts as Presented on a Net Basis	12.4	15.6
Prepaid Expenses and Other Current Assets | Commodity Contracts
Derivative [Line Items]
Derivative Asset, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	16.7	11.4
Derivative Asset, Derivative Contract Amounts Subject to Right of Offset	(1.4)	0.0
Derivative Asset, Derivative Contracts as Presented on a Net Basis	15.3	11.4
Other Noncurrent Assets
Derivative [Line Items]
Derivative Asset, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	3.9	1.7
Other Noncurrent Assets | Currency Contracts
Derivative [Line Items]
Derivative Asset, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	0.9	1.6
Derivative Asset, Derivative Contract Amounts Subject to Right of Offset	0.0	0.0
Derivative Asset, Derivative Contracts as Presented on a Net Basis	0.9	1.6
Other Noncurrent Assets | Commodity Contracts
Derivative [Line Items]
Derivative Asset, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	1.2	0.1
Derivative Asset, Derivative Contract Amounts Subject to Right of Offset	(0.4)	0.0
Derivative Asset, Derivative Contracts as Presented on a Net Basis	0.8	0.1
Other Accrued Expenses
Derivative [Line Items]
Derivative Liability, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	2.6	1.7
Other Accrued Expenses | Currency Contracts
Derivative [Line Items]
Derivative Liability, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	1.2	1.0
Derivative Liability, Derivative Contract Amounts Subject to Right of Offset	(1.2)	(1.0)
Derivative Liability, Derivative Contracts as Presented on a Net Basis	0.0	0.0
Other Accrued Expenses | Commodity Contracts
Derivative [Line Items]
Derivative Liability, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	1.4
Derivative Liability, Derivative Contract Amounts Subject to Right of Offset	(1.4)
Derivative Liability, Derivative Contracts as Presented on a Net Basis	0.0
Other Noncurrent Liabilities
Derivative [Line Items]
Derivative Liability, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	0.6	1.5
Other Noncurrent Liabilities | Currency Contracts
Derivative [Line Items]
Derivative Liability, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	0.1	0.1
Derivative Liability, Derivative Contract Amounts Subject to Right of Offset	0.0	0.0
Derivative Liability, Derivative Contracts as Presented on a Net Basis	0.1	$ 0.1
Other Noncurrent Liabilities | Commodity Contracts
Derivative [Line Items]
Derivative Liability, Gross Amounts as Presented in the Condensed Consolidated Balance Sheet	0.5
Derivative Liability, Derivative Contract Amounts Subject to Right of Offset	(0.4)
Derivative Liability, Derivative Contracts as Presented on a Net Basis	$ 0.1

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FAIR VALUE (Details) - USD ($) $ in Millions	Jul. 03, 2021	Jan. 02, 2021
Prepaid Expenses and Other Current Assets
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	$ 30.3	$ 28.0
Prepaid Expenses and Other Current Assets | Commodity Contracts
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	16.7	11.4
Prepaid Expenses and Other Current Assets | Derivative Currency Contracts | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	13.6	16.6
Prepaid Expenses and Other Current Assets | Commodity Contracts | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	16.7	11.4
Other Noncurrent Assets
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	3.9	1.7
Other Noncurrent Assets | Commodity Contracts
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	1.2	0.1
Other Noncurrent Assets | Derivative Currency Contracts | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	0.9	1.6
Other Noncurrent Assets | Commodity Contracts | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	1.2	0.1
Other Noncurrent Assets | Assets Held in Rabbi Trust | Level 1
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	6.7	6.5
Other Noncurrent Assets | Interest Rate Swaps | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative asset	1.8	0.0
Other Accrued Expenses
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	2.6	1.7
Other Accrued Expenses | Commodity Contracts
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	1.4
Other Accrued Expenses | Derivative Currency Contracts | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	1.2	1.0
Other Accrued Expenses | Commodity Contracts | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	1.4	0.0
Other Accrued Expenses | Interest Rate Swaps | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	0.0	0.7
Other Noncurrent Liabilities
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	0.6	1.5
Other Noncurrent Liabilities | Commodity Contracts
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	0.5
Other Noncurrent Liabilities | Derivative Currency Contracts | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	0.1	0.1
Other Noncurrent Liabilities | Commodity Contracts | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	0.5	0.0
Other Noncurrent Liabilities | Interest Rate Swaps | Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Derivative liability	$ 0.0	$ 1.4

XML

RESTRUCTURING ACTIVITIES (Schedule Of Restructuring Reserve) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Restructuring Reserve [Roll Forward]
Beginning Balance	$ 2.7	$ 2.4	$ 2.0	$ 0.9
Provision	1.5	7.8	3.2	12.9
Less: Payments/ Other	1.7	7.3	2.7	10.9
Ending Balance	$ 2.5	$ 2.9	$ 2.5	$ 2.9

XML

RESTRUCTURING ACTIVITIES (Reconciliation Of Expenses By Type) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Restructuring Cost and Reserve [Line Items]
Restructuring costs	$ 1.5	$ 7.8	$ 3.2	$ 12.9
Total restructuring and restructuring-related costs	1.5	7.8	3.2	12.9
Commercial Systems
Restructuring Cost and Reserve [Line Items]
Total restructuring and restructuring-related costs	0.1	2.3	0.3	4.1
Industrial Systems
Restructuring Cost and Reserve [Line Items]
Total restructuring and restructuring-related costs	0.3	2.0	0.8	2.9
Climate Solutions
Restructuring Cost and Reserve [Line Items]
Total restructuring and restructuring-related costs	0.3	1.3	0.6	2.4
Power Transmission Solutions
Restructuring Cost and Reserve [Line Items]
Total restructuring and restructuring-related costs	0.8	2.2	1.5	3.5
Employee Termination Expenses
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.4	4.0	1.0	5.9
Facility Related Costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.9	3.6	1.9	6.7
Other Expenses
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.2	0.2	0.3	0.3
Cost of Sales
Restructuring Cost and Reserve [Line Items]
Restructuring costs	1.2	4.8	2.3	9.1
Cost of Sales | Employee Termination Expenses
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.2	1.4	0.4	2.9
Cost of Sales | Facility Related Costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.8	3.2	1.6	5.9
Cost of Sales | Other Expenses
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.2	0.2	0.3	0.3
Operating Expenses
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.3	3.0	0.9	3.8
Operating Expenses | Employee Termination Expenses
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.2	2.6	0.6	3.0
Operating Expenses | Facility Related Costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0.1	0.4	0.3	0.8
Operating Expenses | Other Expenses
Restructuring Cost and Reserve [Line Items]
Restructuring costs	$ 0.0	$ 0.0	$ 0.0	$ 0.0

XML

RESTRUCTURING ACTIVITIES (Narrative) (Details) - USD ($) $ in Millions	Dec. 31, 2021	Jul. 03, 2021
Restructuring Cost and Reserve [Line Items]
Expected future restructuring charges		$ 3.5
Forecast
Restructuring Cost and Reserve [Line Items]
Expected future restructuring charges	$ 16.0
Employee Termination Expenses
Restructuring Cost and Reserve [Line Items]
Expected future restructuring charges		1.9
Facility and other related costs
Restructuring Cost and Reserve [Line Items]
Expected future restructuring charges		$ 1.6

XML

Label	Element	Value
Accounting Standards Update [Extensible Enumeration]	us-gaap_AccountingStandardsUpdateExtensibleList	Accounting Standards Update 2016-13 [Member]