STOCKHOLDERS’ EQUITY
Total non-stockholder changes in equity (comprehensive income) include all changes in equity during a period except those resulting from investments by, and distributions to, stockholders. The specific components include: net income, deferred gains and losses resulting from foreign currency translation, pension liability adjustments, equity security adjustments and deferred gains and losses resulting from derivative hedging transactions. Total non-stockholder changes in equity were as follows (in millions): | | | | | | | | | | | | | | | | | | Three Months Ended
June 30, | | Six Months Ended
June 30, | | 2016 | | 2015 | | 2016 | | 2015 | Net income (loss) | $ | 64.6 |
| | $ | 85.9 |
| | $ | (6.4 | ) | | $ | 87.5 |
| Other comprehensive income (loss), net of tax: | | | |
| | | | | Cumulative translation adjustment (CTA), net of (provision for) benefit from taxes of $(8.0), $2.4, $(7.7) and $9.2, respectively | (72.4 | ) | | 85.4 |
| | (10.5 | ) | | (126.2 | ) | Derivative hedging adjustment, net of (provision for) benefit from taxes of $0.5, $(0.2), $0.8 and $0.0, respectively | (1.2 | ) | | 0.8 |
| | (4.8 | ) | | 1.1 |
| Debt and equity securities adjustment, net of (provision for) benefit from taxes of $0.0, $0.1, $0.0 and $0.1, respectively | 2.7 |
| | (2.3 | ) | | 2.3 |
| | (5.4 | ) | Pension liability adjustment: | | | | | | | | Amortization of actuarial (gain) loss, net of provision for (benefit from) taxes of $(1.1), $(0.4), $(1.6) and $(0.8), respectively | 1.4 |
| | 2.4 |
| | 3.3 |
| | 4.9 |
| Foreign exchange and other effects, net of (provision for) benefit from taxes of $(1.0), $1.1, $0.2 and $(1.3), respectively | 4.4 |
| | (5.4 | ) | | 3.0 |
| | 6.7 |
| Total pension liability adjustment | 5.8 |
|
| (3.0 | ) | | 6.3 |
| | 11.6 |
| Other comprehensive income (loss) | (65.1 | ) | | 80.9 |
| | (6.7 | ) | | (118.9 | ) | Comprehensive income (loss) | (0.5 | ) | | 166.8 |
| | (13.1 | ) | | (31.4 | ) | Comprehensive loss (income) attributable to noncontrolling interest | 0.8 |
| | (1.1 | ) | | 0.9 |
| | (1.7 | ) | Comprehensive income (loss) attributable to Terex Corporation | $ | 0.3 |
| | $ | 165.7 |
| | $ | (12.2 | ) | | $ | (33.1 | ) |
Changes in Accumulated Other Comprehensive Income The table below presents changes in AOCI by component for the three and six months ended June 30, 2016 and 2015. All amounts are net of tax (in millions). | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three months ended June 30, 2016 | | Three months ended June 30, 2015 | | CTA | Deriv. Hedging Adj. | Debt & Equity Securities Adj. | Pension Liability Adj. | Total | | CTA | Deriv. Hedging Adj. | Debt & Equity Securities Adj. | Pension Liability Adj. | Total | Beginning balance | $ | (430.8 | ) | $ | (1.3 | ) | $ | (6.7 | ) | $ | (152.4 | ) | $ | (591.2 | ) | | $ | (457.1 | ) | $ | (0.4 | ) | $ | (1.5 | ) | $ | (170.6 | ) | $ | (629.6 | ) | Other comprehensive income before reclassifications | (72.4 | ) | (1.1 | ) | 2.7 |
| 4.4 |
| (66.4 | ) | | 85.4 |
| 5.8 |
| (2.3 | ) | (5.4 | ) | 83.5 |
| Amounts reclassified from AOCI | — |
| (0.1 | ) | — |
| 1.4 |
| 1.3 |
| | — |
| (5.0 | ) | — |
| 2.4 |
| (2.6 | ) | Net other comprehensive Income (Loss) | (72.4 | ) | (1.2 | ) | 2.7 |
| 5.8 |
| (65.1 | ) | | 85.4 |
| 0.8 |
| (2.3 | ) | (3.0 | ) | 80.9 |
| Ending balance | $ | (503.2 | ) | $ | (2.5 | ) | $ | (4.0 | ) | $ | (146.6 | ) | $ | (656.3 | ) | | $ | (371.7 | ) | $ | 0.4 |
| $ | (3.8 | ) | $ | (173.6 | ) | $ | (548.7 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Six months ended June 30, 2016 | | Six months ended June 30, 2015 | | CTA | Deriv. Hedging Adj. | Debt & Equity Securities Adj. | Pension Liability Adj. | Total | | CTA | Deriv. Hedging Adj. | Debt & Equity Securities Adj. | Pension Liability Adj. | Total | Beginning balance | $ | (492.7 | ) | $ | 2.3 |
| $ | (6.3 | ) | $ | (152.9 | ) | $ | (649.6 | ) | | $ | (245.5 | ) | $ | (0.7 | ) | $ | 1.6 |
| $ | (185.2 | ) | $ | (429.8 | ) | Other comprehensive income before reclassifications | (10.5 | ) | (3.5 | ) | 2.3 |
| 3.0 |
| (8.7 | ) | | (126.2 | ) | 3.0 |
| (5.4 | ) | 6.7 |
| (121.9 | ) | Amounts reclassified from AOCI | — |
| (1.3 | ) | — |
| 3.3 |
| 2.0 |
| | — |
| (1.9 | ) | — |
| 4.9 |
| 3.0 |
| Net Other Comprehensive Income (Loss) | (10.5 | ) | (4.8 | ) | 2.3 |
| 6.3 |
| (6.7 | ) | | (126.2 | ) | 1.1 |
| (5.4 | ) | 11.6 |
| (118.9 | ) | Ending balance | $ | (503.2 | ) | $ | (2.5 | ) | $ | (4.0 | ) | $ | (146.6 | ) | $ | (656.3 | ) | | $ | (371.7 | ) | $ | 0.4 |
| $ | (3.8 | ) | $ | (173.6 | ) | $ | (548.7 | ) |
Stock-Based Compensation
During the six months ended June 30, 2016, the Company awarded 2.0 million shares of restricted stock to its employees with a weighted average grant date fair value of $23.88 per share. Approximately 80% of these restricted stock awards vest ratably over a three year period and approximately 20% cliff vest at the end of a three year period and are based on performance targets containing a market condition. The Company used the Monte Carlo method to determine grant date fair value of $29.24 per share for the awards with a market condition granted on March 3, 2016. The Monte Carlo method is a statistical simulation technique used to provide the grant date fair value of an award. The following table presents the weighted-average assumptions used in the valuation: | | | | | Grant date | | March 3, 2016 | Dividend yields | 1.22 | % | Expected volatility | 45.59 | % | Risk free interest rate | 0.97 | % | Expected life (in years) | 3 |
|
Share Repurchases and Dividends
In February 2015, the Company announced authorization by its Board of Directors for the repurchase of up to $200 million of the Company’s outstanding shares of common stock. During the six months ended June 30, 2016 the Company did not repurchase any shares under this program. In each of the first two quarters of 2016, the Company’s Board of Directors declared a dividend of $0.07 per share, which was paid to its shareholders. |