|
|
|
|
|
|
Note 1—Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have been prepared by Carlisle Companies Incorporated (the “Company” or “Carlisle”) in accordance and consistent with the accounting policies stated in the Company’s Annual Report on Form 10-K and should be read in conjunction with the consolidated financial statements therein. The unaudited condensed consolidated financial statements are prepared in conformity with accounting principles generally accepted in the United States and, of necessity, include some amounts that are based upon management estimates and judgments. The unaudited condensed consolidated financial statements include assets, liabilities, net sales, and expenses of all majority-owned subsidiaries. Carlisle accounts for investments in minority-owned companies where it exercises significant influence, but does not have control, on the equity basis. Intercompany transactions and balances are eliminated in consolidation.
|
Note 2—New Accounting Pronouncements
New Accounting Standards Issued But Not Yet Adopted
In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). ASU 2014-09 outlines a single, comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance issued by the FASB, including industry specific guidance. ASU 2014-09 provides accounting guidance for all revenue arising from contracts with customers and affects all entities that enter into contracts with customers to provide goods and services. The guidance also provides a model for the measurement and recognition of gains and losses on the sale of certain nonfinancial assets, such as property and equipment, including real estate.
ASU 2014-09 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2017. The new standard must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach.
ASU 2014-09 also requires entities to disclose both quantitative and qualitative information to enable users of the financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers.
We have not yet determined the impact of adopting the standard on our financial statements nor have we determined whether we will utilize the full retrospective or the modified retrospective approach.
In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs (“ASU 2015-03”). ASU 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. ASU 2015-03 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015, and early adoption is permitted. The provisions of ASU 2015-03 are not expected to have a material effect on the Company’s financial condition.
In August 2015, the FASB issued ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements (“ASU 2015-15”). ASU 2015-15 expands guidance provided in ASU 2015-03 and states that presentation of costs associated with securing a revolving line of credit as an asset is permitted, regardless of whether a balance is outstanding. ASU 2015-15 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015, and early adoption is permitted. The provisions of ASU 2015-15 are not expected to have a material effect on the Company’s financial condition.
In April 2015, the FASB issued ASU 2015-05, Customer’s Accounting For Fees Paid In A Cloud Computing Arrangement (“ASU 2015-05”), which provides guidance for a customer’s accounting for cloud computing costs. ASU 2015-05 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015. The provisions of ASU 2015-05 are not expected to have a material effect on the Company’s financial condition, results of operations, or cash flows.
In July 2015, the FASB issued ASU 2015-11, Simplifying the Measurement of Inventory (“ASU 2015-11”), which applies to inventory valued at first-in, first-out (FIFO) or average cost. ASU 2015-11 requires inventory to be measured at the lower of cost and net realizable value, rather than at the lower of cost or market. ASU 2015-11 is effective on a prospective basis for annual periods, including interim reporting periods within those periods, beginning after December 15, 2016. The Company reports inventory on an average-cost basis and thus will be required to adopt the standard; however, the provisions of ASU 2015-11 are not expected to have a material effect on the Company’s financial condition.
In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments (“ASU 2015-16”). ASU 2015-16 eliminates the requirement to restate prior period financial statements for measurement period adjustments. The new guidance requires that the cumulative impact of a measurement period adjustment (including the impact on prior periods) be recognized in the reporting period in which the adjustment is identified. In addition, separate presentation on the face of the income statement or disclosure in the notes is required regarding the portion of the adjustment recorded in the current period earnings, by line item, that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. ASU 2015-16 is to be applied prospectively for measurement period adjustments that occur after the effective date. ASU 2015-16 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2015, and early adoption is permitted. Since it is prospective, the impact of ASU 2015-16 on the Company’s financial condition and earnings will depend upon the nature of any measurement period adjustments identified in future periods.
|
Note 3—Segment Information
The Company’s operations are reported in the following segments:
Carlisle Construction Materials (“CCM” or the “Construction Materials segment”)—the principal products of this segment are insulation materials, rubber (EPDM), thermoplastic polyolefin (TPO), and polyvinyl chloride (PVC) roofing membranes used predominantly on non-residential low-sloped roofs, related roofing accessories, including flashings, fasteners, sealing tapes, and coatings and waterproofing products. The markets served include new construction, re-roofing and maintenance of low-sloped roofs, water containment, HVAC sealants, and coatings and waterproofing.
Carlisle Interconnect Technologies (“CIT” or the “Interconnect Technologies segment”)—the principal products of this segment are high-performance wire, cable, connectors, contacts, and cable assemblies for the transfer of power and data primarily for the aerospace, medical, defense electronics, test and measurement equipment, and select industrial markets.
Carlisle Fluid Technologies (“CFT” or the “Fluid Technologies segment”)—the principal products of this segment are industrial finishing equipment and integrated system solutions for spraying, pumping, mixing, metering, and curing of a variety of coatings used in the transportation, general industrial, protective coating, wood, specialty, and auto refinishing markets.
Carlisle Brake & Friction (“CBF” or the “Brake & Friction segment”)—the principal products of this segment include high-performance brakes and friction material, and clutch and transmission friction material for the construction, agriculture, mining, aerospace, and motor sports markets.
Carlisle FoodService Products (“CFSP” or the “FoodService Products segment”)—the principal products of this segment include commercial and institutional foodservice permanentware, table coverings, cookware, catering equipment, fiberglass and composite material trays and dishes, industrial brooms, brushes, mops, and rotary brushes for commercial and non-commercial foodservice operators and sanitary maintenance professionals.
Corporate earnings before interest and income taxes (“EBIT”) includes other unallocated costs, primarily general corporate expenses. Corporate assets consist primarily of cash and cash equivalents, deferred taxes, corporate aircraft, and other invested assets.
Financial information for continuing operations by reportable segment is included in the following summary:
Three Months Ended September 30, |
|
2015 |
|
2014 |
|
||||||||
(in millions) |
|
Net Sales |
|
EBIT |
|
Net Sales |
|
EBIT |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Carlisle Construction Materials |
|
$ |
570.1 |
|
$ |
115.5 |
|
$ |
589.1 |
|
$ |
97.0 |
|
Carlisle Interconnect Technologies |
|
202.3 |
|
41.2 |
|
164.4 |
|
33.9 |
|
||||
Carlisle Fluid Technologies |
|
67.9 |
|
10.1 |
|
— |
|
— |
|
||||
Carlisle Brake & Friction |
|
70.7 |
|
0.5 |
|
89.3 |
|
6.1 |
|
||||
Carlisle FoodService Products |
|
62.1 |
|
7.7 |
|
61.3 |
|
7.4 |
|
||||
Corporate |
|
— |
|
(13.2 |
) |
— |
|
(10.4 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Total |
|
$ |
973.1 |
|
$ |
161.8 |
|
$ |
904.1 |
|
$ |
134.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
2015 |
|
2014 |
|
||||||||||||||
(in millions) |
|
Net Sales |
|
EBIT |
|
Assets |
|
Net Sales |
|
EBIT |
|
Assets |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Carlisle Construction Materials |
|
$ |
1,519.0 |
|
$ |
264.3 |
|
$ |
1,007.8 |
|
$ |
1,472.2 |
|
$ |
210.0 |
|
$ |
1,033.6 |
|
Carlisle Interconnect Technologies |
|
595.0 |
|
111.8 |
|
1,294.2 |
|
477.5 |
|
98.7 |
|
1,042.1 |
|
||||||
Carlisle Fluid Technologies |
|
129.6 |
|
9.1 |
|
677.1 |
|
— |
|
— |
|
— |
|
||||||
Carlisle Brake & Friction |
|
242.1 |
|
16.8 |
|
579.4 |
|
279.1 |
|
26.1 |
|
602.7 |
|
||||||
Carlisle FoodService Products |
|
181.3 |
|
20.3 |
|
202.7 |
|
185.2 |
|
22.9 |
|
204.2 |
|
||||||
Corporate |
|
— |
|
(46.1 |
) |
314.4 |
|
— |
|
(38.4 |
) |
835.8 |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total |
|
$ |
2,667.0 |
|
$ |
376.2 |
|
$ |
4,075.6 |
|
$ |
2,414.0 |
|
$ |
319.3 |
|
$ |
3,718.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note 4 — Acquisitions
2015 Acquisition
Finishing Brands
On April 1, 2015, the Company acquired 100% of the Finishing Brands business from Graco Inc. (“Graco”) for total cash consideration of $598.9 million, net of $12.2 million cash acquired. The Company funded the acquisition with cash on hand. As of the acquisition date, the Company recorded a payable to Graco for $20.6 million representing the estimated working capital settlement. In the third quarter of 2015, the Company finalized the working capital settlement with Graco for $21.1 million in cash. The additional cash consideration paid has been allocated to goodwill. The Company has reported the results of the acquired business as a new reporting segment named Carlisle Fluid Technologies (“CFT”). CFT is a global manufacturer and supplier of finishing equipment and systems serving diverse end markets for paints and coatings, including original equipment (“OE”) automotive, automotive refinishing, aerospace, agriculture, construction, marine, rail, and other industrial applications.
CFT contributed net sales of $129.6 million and earnings before interest and taxes of $9.1 million for the period from April 1, 2015 to September 30, 2015. Earnings before interest and taxes for the period from April 1, 2015 to September 30, 2015 includes $0.7 million of non-recurring acquisition-related costs related primarily to professional fees and $8.6 million of non-recurring incremental cost of goods sold related to measuring inventory at fair value. Earnings before interest and taxes for the period from April 1, 2015 to September 30, 2015 also includes $6.2 million and $2.6 million of amortization expense of customer relationships and acquired technology, respectively.
The Finishing Brands amounts included in the pro forma financial information below are based on the Finishing Brands’ historical results and, therefore, may not be indicative of the actual results if operated by Carlisle. The pro forma adjustments represent management’s best estimates based on information available at the time the pro forma information was prepared and may differ from the adjustments that may actually have been required. Accordingly, pro forma information should not be relied upon as being indicative of the historical results that would have been realized had the acquisition occurred as of the date indicated or that may be achieved in the future.
The unaudited combined pro forma financial information presented below includes Net sales and Income from continuing operations, net of tax, of the Company as if the business combination had occurred on January 1, 2014 based on the preliminary purchase price allocation presented below:
|
|
Pro Forma |
|
Pro Forma |
|
||||||||
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
||||||||
(in millions) |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Net sales |
|
$ |
973.1 |
|
$ |
970.3 |
|
$ |
2,728.2 |
|
$ |
2,614.9 |
|
Income from continuing operations |
|
103.6 |
|
91.9 |
|
250.5 |
|
208.9 |
|
The pro forma financial information reflects adjustments to Finishing Brands’ historical financial information to apply the Company’s accounting policies and to reflect the additional depreciation and amortization related to the preliminary fair value adjustments of the acquired net assets, together with the associated tax effects. Also, the pro forma financial information reflects the non-recurring costs of goods sold related to the fair valuation of inventory and acquisition-related costs described above as if they occurred in the first quarter of 2014.
The following table summarizes the consideration transferred to acquire Finishing Brands and the preliminary allocation among the assets acquired and liabilities assumed. The acquisition has been accounted for using the acquisition method of accounting in accordance with ASC 805, Business Combinations, which requires that consideration be allocated to the acquired assets and liabilities based upon their acquisition date fair values with the remainder allocated to goodwill.
|
|
Preliminary |
|
Measurement |
|
Preliminary |
|
|||
|
|
As of |
|
Six Months |
|
As of |
|
|||
(in millions) |
|
4/1/2015 |
|
9/30/2015 |
|
9/30/2015 |
|
|||
Total cash consideration transferred and payable |
|
$ |
610.6 |
|
$ |
0.5 |
|
$ |
611.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Recognized amounts of identifiable assets acquired and liabilities assumed: |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Cash and cash equivalents |
|
$ |
12.2 |
|
$ |
— |
|
$ |
12.2 |
|
Receivables |
|
57.3 |
|
— |
|
57.3 |
|
|||
Inventories |
|
40.9 |
|
— |
|
40.9 |
|
|||
Prepaid expenses and other current assets |
|
6.4 |
|
(0.1 |
) |
6.3 |
|
|||
Property, plant, and equipment |
|
41.0 |
|
(0.2 |
) |
40.8 |
|
|||
Definite-lived intangible assets |
|
216.0 |
|
— |
|
216.0 |
|
|||
Indefinite-lived intangible assets |
|
125.0 |
|
— |
|
125.0 |
|
|||
Deferred income tax assets |
|
1.9 |
|
— |
|
1.9 |
|
|||
Other non-current assets |
|
3.8 |
|
— |
|
3.8 |
|
|||
Line of credit |
|
(1.4 |
) |
— |
|
(1.4 |
) |
|||
Accounts payable |
|
(16.3 |
) |
— |
|
(16.3 |
) |
|||
Income tax payable |
|
(1.9 |
) |
— |
|
(1.9 |
) |
|||
Accrued expenses |
|
(15.6 |
) |
0.3 |
|
(15.3 |
) |
|||
Deferred income tax liabilities |
|
(28.8 |
) |
— |
|
(28.8 |
) |
|||
Other non-current liabilities |
|
(5.6 |
) |
— |
|
(5.6 |
) |
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Total identifiable net assets |
|
434.9 |
|
— |
|
434.9 |
|
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Goodwill |
|
$ |
175.7 |
|
$ |
0.5 |
|
$ |
176.2 |
|
|
|
|
|
|
|
|
|
|
|
|
The goodwill recognized in the acquisition of Finishing Brands is attributable to its experienced workforce, the expected operational improvements through implementation of the Carlisle Operating System, opportunities for geographic and product line expansions in addition to supply chain efficiencies and other administrative opportunities, and the significant strategic value of the business to Carlisle. The Company acquired $58.8 million of gross contractual accounts receivable, of which $1.5 million is not expected to be collected. Goodwill of $134.9 million is tax deductible, primarily in the United States. All of the goodwill was assigned to the CFT reporting unit which aligns with the reportable segment. Indefinite-lived intangible assets of $125.0 million represent acquired trade names. The $216.0 million value allocated to definite-lived intangible assets consists of $186.0 million of customer relationships with a useful life of 15 years and various acquired technologies of $30.0 million with useful lives ranging from five to eight years. The Company recorded an indemnification asset of $3.0 million in Other long-term assets relating to the indemnification of Carlisle for a pre-acquisition tax liability in accordance with the purchase agreement. The Company has also recorded deferred tax liabilities related to intangible assets of approximately $28.8 million.
As additional information is obtained, adjustments may be made to the preliminary purchase price allocation. The Company is still finalizing the fair value of certain property assets, tax liabilities, and accrued expenses.
2014 Acquisition
LHi Technology
On October 1, 2014, the Company acquired 100% of the equity of LHi Technology (“LHi”) for total cash consideration of $194.0 million, net of $6.7 million cash acquired, inclusive of the working capital settlement. The Company funded the acquisition with cash on hand. LHi is a leading designer, manufacturer and provider of cable assemblies and related interconnect components to the medical equipment and device industry. The acquisition will strengthen Carlisle’s launch of its medical cable and cable assembly product line by adding new products, new customers, and complementary technologies to better serve the global healthcare market. LHi operates within the Interconnect Technologies segment.
The following table summarizes the consideration transferred to acquire LHi and the final allocation among the assets acquired and liabilities assumed. The acquisition has been accounted for using the acquisition method of accounting which requires that consideration be allocated to the acquired assets and liabilities based upon their acquisition date fair values with the remainder allocated to goodwill.
|
|
Preliminary |
|
Measurement |
|
Final |
|
|||
|
|
As of |
|
|
|
As of |
|
|||
(in millions) |
|
10/1/2014 |
|
|
|
9/30/2015 |
|
|||
Total cash consideration transferred |
|
$ |
200.7 |
|
$ |
— |
|
$ |
200.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Recognized amounts of identifiable assets acquired and liabilities assumed: |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Cash and cash equivalents |
|
$ |
6.7 |
|
$ |
— |
|
$ |
6.7 |
|
Receivables |
|
26.9 |
|
— |
|
26.9 |
|
|||
Inventories |
|
17.1 |
|
— |
|
17.1 |
|
|||
Prepaid expenses and other current assets |
|
2.9 |
|
— |
|
2.9 |
|
|||
Property, plant, and equipment |
|
4.5 |
|
— |
|
4.5 |
|
|||
Definite-lived intangible assets |
|
74.5 |
|
— |
|
74.5 |
|
|||
Indefinite-lived intangible assets |
|
6.0 |
|
— |
|
6.0 |
|
|||
Other non-current assets |
|
8.8 |
|
— |
|
8.8 |
|
|||
Accounts payable |
|
(16.9 |
) |
— |
|
(16.9 |
) |
|||
Income tax payable |
|
(0.3 |
) |
— |
|
(0.3 |
) |
|||
Accrued expenses |
|
(4.9 |
) |
(1.1 |
) |
(6.0 |
) |
|||
Net deferred tax liabilities |
|
(16.2 |
) |
— |
|
(16.2 |
) |
|||
Other non-current liabilities |
|
(20.1 |
) |
— |
|
(20.1 |
) |
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Total identifiable net assets |
|
89.0 |
|
(1.1 |
) |
87.9 |
|
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Goodwill |
|
$ |
111.7 |
|
$ |
1.1 |
|
$ |
112.8 |
|
|
|
|
|
|
|
|
|
|
|
|
The goodwill recognized in the acquisition of LHi is attributable to the workforce of LHi, the solid financial performance in the medical cable market, and the significant strategic value of the business to Carlisle. Goodwill arising from the acquisition of LHi is not deductible for income tax purposes. All of the goodwill was assigned to the Interconnect Technologies reporting unit. Indefinite-lived intangible assets of $6.0 million represent acquired trade names. The $74.5 million value allocated to definite-lived intangible assets consists of $57.0 million of customer relationships with a useful life of 15 years, $16.0 million of acquired technology with a useful life of six years, and a $1.5 million non-compete agreement with a useful life of five years. The Company recorded an indemnification asset of $8.7 million in Other long-term assets relating to the indemnification of Carlisle for certain pre-acquisition liabilities, in accordance with the purchase agreement. The Company has also recorded deferred tax liabilities related to intangible assets as of the closing date.
The Company recorded an increase to accrued expenses of $1.1 million and a corresponding increase to goodwill of $1.1 million as a measurement period adjustment.
|
Note 5—Stock-Based Compensation
Stock-based compensation cost is recognized over the requisite service period, which generally equals the stated vesting period, unless the stated vesting period exceeds the date upon which an employee reaches retirement eligibility. Pre-tax stock-based compensation expense in continuing operations was $4.1 million and $2.9 million for the three month periods ended September 30, 2015 and 2014, respectively, and $14.6 million and $13.6 million for the nine months ended September 30, 2015 and 2014, respectively.
Incentive Compensation Program
The Company maintains an Incentive Compensation Program (the “Program”) for executives, certain other employees of the Company and its operating segments and subsidiaries, and the Company’s non-employee directors. The Program was approved by shareholders on May 6, 2015. The Program allows for awards to eligible employees of stock options, restricted stock, stock appreciation rights, performance shares and units or other awards based on Company common stock. At September 30, 2015, 4,204,698 shares were available for grant under this plan, of which 1,588,163 shares were available for the issuance of stock awards.
Nonemployee Director Equity Plan
The Company also maintains the Nonemployee Director Equity Plan (the “Plan”) for members of its Board of Directors, with the same terms and conditions as the Program. At September 30, 2015, 244,764 shares were available for grant under this plan of which 14,764 restricted shares were available for the issuance of stock awards. Members of the Board of Directors that receive stock-based compensation are treated as employees for accounting purposes.
Grants
For the nine months ended September 30, 2015, the Company awarded 316,345 stock options, 58,040 restricted stock awards, 58,040 performance share awards and 11,801 restricted stock units with an aggregate grant-date fair value of approximately $19.6 million to be expensed over the requisite service period for each award.
Stock Option Awards
Options issued under these plans generally vest one-third on the first anniversary of grant, one-third on the second anniversary of grant, and the remaining one-third on the third anniversary of grant. All options have a maximum term life of 10 years. Shares issued to cover options under the Program and the Plan may be issued from shares held in treasury, from new issuances of shares, or a combination of the two.
Pre-tax share-based compensation expense related to stock options was $1.5 million and $0.9 million for the three month periods ended September 30, 2015 and 2014, respectively, and $3.9 million and $3.1 million for the nine months ended September 30, 2015 and 2014, respectively.
The Company utilizes the Black-Scholes-Merton (“BSM”) option pricing model to determine the fair value of its stock option awards. The BSM relies on certain assumptions to estimate an option’s fair value. The weighted-average assumptions used in the determination of fair value for stock option awards in 2015 and 2014 were as follows:
|
|
2015 |
|
2014 |
|
||
Expected dividend yield |
|
1.1 |
% |
1.2 |
% |
||
Expected life in years |
|
5.71 |
|
5.74 |
|
||
Expected volatility |
|
27.3 |
% |
29.3 |
% |
||
Risk-free interest rate |
|
1.4 |
% |
1.7 |
% |
||
Weighted-average fair value |
|
$ |
21.19 |
|
$ |
19.15 |
|
The expected life of options is based on the assumption that all outstanding options will be exercised at the midpoint of the valuation date (if vested) or the vesting dates (if unvested) and the options’ expiration date. The expected volatility is based on historical volatility as well as implied volatility of the Company’s options. The risk-free interest rate is based on rates of U.S. Treasury issues with a remaining life equal to the expected life of the option. The expected dividend yield is based on the projected annual dividend payment per share, divided by the stock price at the date of grant.
Restricted Stock Awards
Restricted stock awarded under the Program is generally released to the recipient after a period of approximately three years. The grant date fair value of the 2015 restricted stock awards, which are released to the recipient after a period of three years, is based on the closing market price of the stock on the date of grant.
Performance Share Awards
The performance shares awarded vest based on the employee rendering three years of service to the Company, and the attainment of a market condition over the performance period, which is based on the Company’s relative total shareholder return versus the S&P Midcap 400 Index® over a pre-determined time period as determined by the Compensation Committee of the Board of Directors. The grant date fair value of the 2015 performance shares was estimated using a Monte-Carlo simulation approach based on a three-year measurement period. Such approach entails the use of assumptions regarding the future performance of the Company’s stock and those of the S&P Midcap 400 Index®. Those assumptions include expected volatility, risk-free interest rates, correlation coefficients, and dividend reinvestment. Dividends accrue on the performance shares during the performance period and are to be paid in cash based upon the number of awards ultimately earned. The Company expenses the compensation cost associated with the performance awards on a straight-line basis over the vesting period of approximately three years.
Restricted Stock Units
The restricted stock units awarded to eligible directors are fully vested and will be paid in shares of Company common stock after the director ceases to serve as a member of the Board, or if earlier, upon a change in control of the Company. The $90.54 grant date fair value of the 2015 restricted stock units is based on the closing market price of the stock on February 4, 2015, the date of the grant.
Deferred Compensation - Equity
Certain employees are eligible to participate in the Company’s Non-qualified Deferred Compensation Plan (the “Deferred Compensation Plan”). Participants may elect to defer all or part of their stock-based compensation. Participants have elected to defer 237,261 shares of Company common stock as of September 30, 2015, and 228,047 shares as of December 31, 2014.
|
Note 6—Income Taxes
The effective income tax rate on continuing operations for the nine months ended September 30, 2015 was 32.2%. The year-to-date provision for income taxes includes taxes on earnings at an anticipated rate of approximately 33% and year-to-date discrete tax benefit of $3.3 million. The year-to-date discrete tax benefit is primarily related to a state valuation allowance release discussed in detail below, a decrease in the anticipated future state income tax rate of the Company, and recognition of state attributes generated with the prior year tax filings finalized in the current quarter.
As of December 31, 2014 management believed it was more likely than not certain of the Company’s state tax attributes would expire unused and a valuation allowance existed to write the assets down to the amount expected to be realized. As of each reporting date, the Company’s management considers new evidence, both positive and negative, that could impact management’s view with regard to the future realization of deferred tax assets. With the acquisition of the Carlisle Fluid Technologies business on April 1, 2015 the Company expects to create sufficient taxable income in certain state taxing jurisdictions so that the assertion regarding the realizability of state tax attributes has changed. As such a discrete tax benefit of $2.0 million was recorded in the second quarter of 2015 to reverse a portion of the Company’s valuation allowance.
The effective tax rate on continuing operations for the nine months ended September 30, 2014 was 32.9% and included a year-to-date discrete benefit of $0.6 million.
|
Note 8—Inventories
The components of Inventories at September 30, 2015 and December 31, 2014 were as follows:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
|
|
|
|
|
|
||
Finished goods |
|
$ |
212.4 |
|
$ |
188.1 |
|
Work-in-process |
|
62.5 |
|
45.3 |
|
||
Raw materials |
|
139.1 |
|
132.2 |
|
||
Reserves |
|
(30.2 |
) |
(26.5 |
) |
||
|
|
|
|
|
|
||
Inventories |
|
$ |
383.8 |
|
$ |
339.1 |
|
|
|
|
|
|
|
|
|
|
Note 9—Property, Plant and Equipment
The components of Property, plant and equipment at September 30, 2015 and December 31, 2014 were as follows:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
Land |
|
$ |
59.2 |
|
$ |
37.1 |
|
Buildings and leasehold improvements |
|
317.5 |
|
284.6 |
|
||
Machinery and equipment |
|
725.8 |
|
690.7 |
|
||
Projects in progress |
|
31.5 |
|
48.6 |
|
||
|
|
|
|
|
|
||
|
|
1,134.0 |
|
1,061.0 |
|
||
Accumulated depreciation |
|
(554.0 |
) |
(513.7 |
) |
||
|
|
|
|
|
|
||
Property, plant, and equipment, net |
|
$ |
580.0 |
|
$ |
547.3 |
|
|
|
|
|
|
|
|
|
|
Note 10—Goodwill and Other Intangible Assets
The changes in the carrying amount of Goodwill, net for the nine months ended September 30, 2015 were as follows:
|
|
Construction |
|
Interconnect |
|
Fluid |
|
Brake and |
|
FoodService |
|
|
|
||||||
(in millions) |
|
Materials |
|
Technologies |
|
Technologies |
|
Friction |
|
Products |
|
Total |
|
||||||
Gross balance at January 1, 2015 |
|
$ |
123.3 |
|
$ |
554.3 |
|
$ |
— |
|
$ |
226.6 |
|
$ |
60.3 |
|
$ |
964.5 |
|
Goodwill acquired during year (1) |
|
— |
|
— |
|
175.7 |
|
— |
|
— |
|
175.7 |
|
||||||
Measurement period adjustments |
|
— |
|
1.1 |
|
0.5 |
|
— |
|
— |
|
1.6 |
|
||||||
Currency translation |
|
(3.4 |
) |
— |
|
(1.2 |
) |
— |
|
— |
|
(4.6 |
) |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net balance at September 30, 2015 |
|
$ |
119.9 |
|
$ |
555.4 |
|
$ |
175.0 |
|
$ |
226.6 |
|
$ |
60.3 |
|
$ |
1,137.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
See Note 4 for further information on goodwill resulting from recent acquisitions. |
The Company’s Other intangible assets, net at September 30, 2015, were as follows:
|
|
Acquired |
|
Accumulated |
|
Net Book |
|
|||
(in millions) |
|
Cost |
|
Amortization |
|
Value |
|
|||
Assets subject to amortization: |
|
|
|
|
|
|
|
|||
Intellectual property |
|
$ |
174.5 |
|
$ |
(48.3 |
) |
$ |
126.2 |
|
Customer relationships |
|
676.6 |
|
(150.4 |
) |
526.2 |
|
|||
Other |
|
20.7 |
|
(13.1 |
) |
7.6 |
|
|||
Assets not subject to amortization: |
|
|
|
|
|
|
|
|||
Trade names |
|
246.1 |
|
— |
|
246.1 |
|
|||
|
|
|
|
|
|
|
|
|||
Other intangible assets, net |
|
$ |
1,117.9 |
|
$ |
(211.8 |
) |
$ |
906.1 |
|
|
|
|
|
|
|
|
|
|
|
|
The Company’s Other intangible assets, net at December 31, 2014, were as follows:
|
|
Acquired |
|
Accumulated |
|
Net Book |
|
|||
(in millions) |
|
Cost |
|
Amortization |
|
Value |
|
|||
Assets subject to amortization: |
|
|
|
|
|
|
|
|||
Intellectual property |
|
$ |
146.6 |
|
$ |
(37.8 |
) |
$ |
108.8 |
|
Customer relationships |
|
494.6 |
|
(122.3 |
) |
372.3 |
|
|||
Other |
|
20.6 |
|
(12.1 |
) |
8.5 |
|
|||
Assets not subject to amortization: |
|
|
|
|
|
|
|
|||
Trade names |
|
122.1 |
|
— |
|
122.1 |
|
|||
|
|
|
|
|
|
|
|
|||
Other intangible assets, net |
|
$ |
783.9 |
|
$ |
(172.2 |
) |
$ |
611.7 |
|
|
|
|
|
|
|
|
|
|
|
|
Estimated amortization expense for the remainder of 2015 and the next four years is as follows: $15.0 million remaining in 2015, $58.8 million in 2016, $58.0 million in 2017, $58.0 million in 2018, and $57.9 million in 2019.
The net carrying values of the Company’s Other intangible assets by reportable segment were as follows:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
|
|
|
|
|
|
||
Carlisle Construction Materials |
|
$ |
63.6 |
|
$ |
72.3 |
|
Carlisle Interconnect Technologies |
|
364.7 |
|
386.6 |
|
||
Carlisle Fluid Technologies |
|
331.4 |
|
— |
|
||
Carlisle Brake & Friction |
|
118.8 |
|
123.5 |
|
||
Carlisle FoodService Products |
|
27.6 |
|
29.3 |
|
||
|
|
|
|
|
|
||
Total |
|
$ |
906.1 |
|
$ |
611.7 |
|
|
|
|
|
|
|
|
|
The most recent annual goodwill impairment test was performed for all reporting units as of October 1, 2014. The Company also performs Step 1 of the goodwill impairment test on an interim basis upon the occurrence of events or substantive changes in circumstances that indicate that a reporting unit’s carrying value may be less than its fair value.
The CBF reporting unit’s goodwill as of September 30, 2015 and December 31, 2014 was $226.6 million. The Company determined through ongoing monitoring that due to various factors it was appropriate to perform Step 1 of the goodwill impairment test as of September 30, 2015. Consistent with the policy described in the 2014 Form 10-K, the Company performed Step 1 of the goodwill impairment test using a discounted cash flow analysis to estimate the fair value of the CBF reporting unit and concluded that its fair value continues to exceed its carrying value.
The Company also evaluated the indefinite-lived intangible assets, primarily trademarks and trade names with a carrying value of $53.5 million, associated with the CBF reporting unit for impairment as of September 30, 2015. The analysis did not result in an impairment of CBF’s trade names as their estimated fair value exceeded their carrying value.
As noted above, the Company believes that the facts and circumstances as of September 30, 2015, indicate that no impairment exists with respect to CBF’s goodwill and other indefinite-lived intangible assets. If the estimates of recovery in CBF’s end markets do not materialize as expected and/or the U.S. Dollar continues to strengthen and therefore results continue to be lower than anticipated, an impairment loss may be recorded.
|
Note 11—Commitments and Contingencies
Leases
The Company currently leases a portion of its manufacturing facilities, distribution centers, and equipment, some of which include scheduled rent increases stated in the lease agreement generally expressed as a stated percentage increase of the minimum lease payment over the lease term. The Company currently has no leases that require rent to be paid based on contingent events nor has it received any lease incentive payments. Rent expense was $19.3 million and $17.6 million for the nine months ended September 30, 2015 and 2014, respectively, inclusive of rent based on scheduled rent increases and rent holidays recognized on a straight-line basis. Future minimum payments under the Company’s various non-cancelable operating leases are approximately $4.4 million for the remainder of 2015, $16.1 million in 2016, $12.8 million in 2017, $10.7 million in 2018, $8.3 million in 2019, and $12.3 million thereafter.
Workers’ Compensation Claims and Related Losses
The Company has accrued approximately $21.4 million and $23.5 million related to workers’ compensation claims at September 30, 2015 and December 31, 2014, respectively. At September 30, 2015, $6.7 million and $14.7 million are included in Accrued expenses and Other long-term liabilities, respectively, and at December 31, 2014, $7.8 million and $15.7 million were included in Accrued expenses and Other long-term liabilities, respectively, in the Condensed Consolidated Balance Sheet. Workers’ compensation obligations related to former employees associated with the Transportation Products business and arising prior to the sale of the Transportation Products business have been retained by the Company, and the Company is obligated to pay the related claims until they are extinguished or otherwise settled. The Company will not be held liable for any workers’ compensation claims related to the former Transportation Products business incurred after December 31, 2013. The liability related to workers’ compensation claims, both those reported to the Company and those incurred but not yet reported, is estimated based on actuarial estimates and loss development factors and the Company’s historical loss experience.
The Company maintains occurrence-based insurance coverage with certain insurance carriers in accordance with its risk management practices that provides for reimbursement of workers’ compensation claims in excess of $0.5 million. The Company records a recovery receivable from the insurance carriers when such recovery is deemed probable based on the nature of the claim and history of recoveries. At September 30, 2015, the Company did not have any recovery receivables recorded for workers’ compensation claims.
Litigation
Over the years, the Company has been named as a defendant, along with numerous other defendants, in lawsuits in various state courts in which plaintiffs have alleged injury due to exposure to asbestos-containing brakes, which Carlisle manufactured in limited amounts between the late-1940s and the mid-1980s. In addition to compensatory awards, these lawsuits may also seek punitive damages.
Generally, the Company has obtained dismissals or settlements of its asbestos-related lawsuits with no material effect on its financial condition, results of operations or cash flows. The Company maintains insurance coverage that applies to the Company’s defense costs and payments of settlements or judgments in connection with asbestos-related lawsuits.
At this time, the amount of reasonably possible additional asbestos claims, if any, is not material to the Company’s financial position, results of operations or operating cash flows although these matters could result in the Company being subject to monetary damages, costs or expenses, and charges against earnings in particular periods.
The Company may occasionally be involved in various other legal actions arising in the normal course of business. In the opinion of management, the ultimate outcome of such actions, either individually or in the aggregate, will not have a material adverse effect on the consolidated financial position, results of operations for a particular period or annual operating cash flows of the Company.
Environmental Matters
The Company is subject to increasingly stringent environmental laws and regulations, including those relating to air emissions, wastewater discharges, chemical and hazardous waste management and disposal. Some of these environmental laws hold owners or operators of land or businesses liable for their own and for previous owners’ or operators’ releases of hazardous or toxic substances or wastes. Other environmental laws and regulations require the obtainment of and compliance with environmental permits. To date, costs of complying with environmental, health, and safety requirements have not been material and we do not currently have any significant accruals related to potential future costs of environmental remediation as of September 30, 2015, nor do we have an asset retirement obligation recorded as of that date. However, the nature of the Company’s operations and its long history of industrial activities at certain of its current or former facilities, as well as those acquired, could potentially result in material environmental liabilities or asset retirement modifications.
While the Company must comply with existing and pending climate change legislation, regulation, international treaties or accords, current laws and regulations do not have a material impact on its business, capital expenditures or financial position. Future events, including those relating to climate change or greenhouse gas regulation, could require the Company to incur expenses related to the modification or curtailment of operations, installation of pollution control equipment, or investigation and cleanup of contaminated sites.
|
Note 12—Borrowings
As of September 30, 2015 and December 31, 2014 the Company’s borrowings were as follows:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
3.75% notes due 2022, net of unamortized discount of ($0.8) and ($0.9), respectively |
|
$ |
349.2 |
|
$ |
349.1 |
|
5.125% notes due 2020, net of unamortized discount of ($0.6) and ($0.7), respectively |
|
249.4 |
|
249.3 |
|
||
6.125% notes due 2016, net of unamortized discount of ($0.1) and ($0.2), respectively |
|
149.9 |
|
149.8 |
|
||
Revolving credit facility |
|
— |
|
— |
|
||
Industrial development and revenue bonds |
|
— |
|
1.5 |
|
||
Other, including capital lease obligations |
|
0.1 |
|
0.1 |
|
||
|
|
|
|
|
|
||
Total long-term debt |
|
748.6 |
|
749.8 |
|
||
Less 6.125% notes due 2016 classified as current |
|
(149.9 |
) |
— |
|
||
|
|
|
|
|
|
||
Total long-term debt, net of current portion |
|
$ |
598.7 |
|
$ |
749.8 |
|
|
|
|
|
|
|
|
|
Revolving Credit Facilities
As of September 30, 2015, the Company had $600.0 million available under its Third Amended and Restated Credit Agreement (the “Amended Credit Agreement”) administered by JPMorgan Chase Bank, N.A. During the nine months ended September 30, 2015 and 2014, there were no borrowings under the revolving credit facility.
Uncommitted Line of Credit
The Company also maintains an uncommitted line of credit of which $45.0 million was available for borrowing as of September 30, 2015 and December 31, 2014. During the nine months ended September 30, 2015 and 2014, there were no borrowings under the uncommitted line of credit.
Industrial Development and Revenue Bonds
The industrial development and revenue bonds were collateralized by letters of credit, Company guarantees, and/or by the facilities and equipment acquired through the proceeds of the related bond issuances. The Company repaid the remaining $1.5 million of the outstanding principal on the industrial development and revenue bonds during the second quarter of 2015.
Covenants and Limitations
Under the Company’s debt and credit facilities, the Company is required to meet various restrictive covenants and limitations, including limitations on certain leverage ratios, interest coverage and limits on outstanding debt balances held by certain subsidiaries. The Company was in compliance with all covenants and limitations as of September 30, 2015 and December 31, 2014.
Other Matters
At September 30, 2015, the fair value of the Company’s par value $350 million, 3.75% senior notes due 2022, $250 million, 5.125% senior notes due 2020, and par value $150 million, 6.125% senior notes due 2016, using Level 2 inputs in the fair value hierarchy, was approximately $351.5 million, $272.6 million and $154.7 million, respectively. Fair value is estimated based on current yield rates plus the Company’s estimated credit spread available for financings with similar terms and maturities.
|
Note 13—Retirement Plans
Defined Benefit Plans
The Company maintains defined benefit retirement plans for certain domestic employees. Benefits are based primarily on years of service and earnings of the employee. The Company recognizes the funded status of its defined benefit plans in the Condensed Consolidated Balance Sheets. The funded status is the difference between the retirement plans’ projected benefit obligation and the fair value of the retirement plans’ assets as of the measurement date.
Components of net periodic benefit cost were as follows:
|
|
Three Months Ended |
|
Nine Months Ended |
|
||||||||
|
|
September 30, |
|
September 30, |
|
||||||||
(in millions) |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Service cost |
|
$ |
0.9 |
|
$ |
0.9 |
|
$ |
2.8 |
|
$ |
2.7 |
|
Interest cost |
|
1.8 |
|
1.9 |
|
5.3 |
|
5.8 |
|
||||
Expected return on plan assets |
|
(2.6 |
) |
(2.6 |
) |
(7.8 |
) |
(8.0 |
) |
||||
Amortization of unrecognized loss |
|
1.3 |
|
1.1 |
|
3.9 |
|
3.2 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Net periodic benefit cost |
|
$ |
1.4 |
|
$ |
1.3 |
|
$ |
4.2 |
|
$ |
3.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company made no contributions to the pension plans during the nine months ended September 30, 2015. No minimum contributions to the pension plans are required in 2015. In light of the plans’ funded status, the Company does not expect to make discretionary contributions to its pension plans in 2015.
During 2015, the Company expects to pay approximately $1.0 million in participant benefits under the non-funded executive supplemental and director plans.
Defined Contribution Plans
The Company maintains defined contribution plans covering a significant portion of its employees. Expenses for the plans were $2.9 million and $2.8 million for the three months ended September 30, 2015 and 2014, respectively, and $9.4 million and $8.4 million for the nine months ended September 30, 2015 and 2014, respectively.
Employee Stock Ownership Plan
The Company sponsors an employee stock ownership plan (“ESOP”) as part of one of its existing savings plans. Costs for the ESOP are included in the defined contribution plans noted above. The ESOP is available to eligible domestic employees and includes a match of contributions made by plan participants to the savings plan up to a maximum of 4.0% of a participant’s eligible compensation, divided between cash and an employee-directed election of the Company’s common stock, not to exceed 50% of the total match. Participants are not allowed to direct savings plan contributions to an investment in the Company’s common stock. Total shares held by the ESOP were 1.3 million at September 30, 2015 and 1.4 million December 31, 2014.
|
Note 14— Deferred Revenue and Extended Product Warranties
Deferred revenue consists primarily of unearned revenue related to separately priced extended warranty contracts on sales of certain products, the most significant being those offered on its installed roofing systems within the Construction Materials segment.
Roofing Systems Deferred Revenue
The amount of revenue recognized related to extended product warranties covering roofing systems was $4.7 million and $4.9 million for the three month periods ended September 30, 2015 and 2014, respectively, and $13.8 million and $13.4 million for the nine month periods ended September 30, 2015 and 2014, respectively. Deferred revenue recognized in the Condensed Consolidated Balance Sheets includes the following related to roofing systems extended product warranty contracts:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
Deferred revenue |
|
|
|
|
|
||
Current |
|
$ |
17.7 |
|
$ |
17.5 |
|
Long-term |
|
155.8 |
|
150.7 |
|
||
|
|
|
|
|
|
||
Deferred revenue liability |
|
$ |
173.5 |
|
$ |
168.2 |
|
|
|
|
|
|
|
|
|
Expected costs of services to be performed under extended product warranty contracts are actuarially determined. Any expected costs in excess of deferred revenue are recognized within Accrued expenses.
Other Deferred Revenue
Other deferred revenue recognized in the Condensed Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014, primarily related to contracts on systems sales within the Fluid Technologies segment, was as follows:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
Deferred revenue |
|
|
|
|
|
||
Current |
|
$ |
9.6 |
|
$ |
0.4 |
|
Long-term |
|
0.1 |
|
0.4 |
|
||
|
|
|
|
|
|
||
Deferred revenue liability |
|
$ |
9.7 |
|
$ |
0.8 |
|
|
|
|
|
|
|
|
|
|
Note 15—Standard Product Warranties
The Company offers various warranty programs on its products included in the price of its products, primarily for certain installed roofing systems, high-performance cables and assemblies, fluid technologies, braking products, and foodservice equipment. The Company’s liability for such warranty programs is included in Accrued expenses. The change in the Company’s product warranty liabilities for the nine months ended September 30 was as follows:
(in millions) |
|
2015 |
|
2014 |
|
||
Balance at January 1 |
|
$ |
15.2 |
|
$ |
14.3 |
|
Current year provision |
|
18.9 |
|
15.7 |
|
||
Acquired warranty obligation |
|
1.1 |
|
— |
|
||
Current year claims |
|
(13.2 |
) |
(14.1 |
) |
||
|
|
|
|
|
|
||
Balance at September 30 |
|
$ |
22.0 |
|
$ |
15.9 |
|
|
|
|
|
|
|
|
|
|
Note 16—Other Long-Term Liabilities
The components of Other long-term liabilities were as follows:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
Deferred taxes and other tax liabilities |
|
$ |
226.2 |
|
$ |
195.4 |
|
Pension and other post-retirement obligations |
|
27.3 |
|
24.8 |
|
||
Long-term workers’ compensation |
|
14.7 |
|
15.7 |
|
||
Deferred compensation |
|
16.3 |
|
14.0 |
|
||
Other |
|
10.8 |
|
10.7 |
|
||
|
|
|
|
|
|
||
Other long-term liabilities |
|
$ |
295.3 |
|
$ |
260.6 |
|
|
|
|
|
|
|
|
|
|
Note 17—Accumulated Other Comprehensive Income (Loss)
The changes in Accumulated other comprehensive income (loss) by component for the three months ended September 30, 2015 were as follows:
|
|
Accrued |
|
Foreign |
|
|
|
|
|
||||
|
|
post-retirement |
|
currency |
|
Hedging |
|
|
|
||||
(in millions) |
|
benefit liability(1) |
|
translation |
|
activities(2) |
|
Total |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at June 30, 2015 |
|
$ |
(30.4 |
) |
$ |
(38.9 |
) |
$ |
0.4 |
|
$ |
(68.9 |
) |
Other comprehensive loss before reclassifications |
|
— |
|
(9.2 |
) |
— |
|
(9.2 |
) |
||||
Amounts reclassified from accumulated other comprehensive loss |
|
1.3 |
|
— |
|
(0.2 |
) |
1.1 |
|
||||
Income tax benefit (expense) |
|
(0.5 |
) |
— |
|
0.1 |
|
(0.4 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
Net other comprehensive income (loss) |
|
0.8 |
|
(9.2 |
) |
(0.1 |
) |
(8.5 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at September 30, 2015 |
|
$ |
(29.6 |
) |
$ |
(48.1 |
) |
$ |
0.3 |
|
$ |
(77.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The changes in Accumulated other comprehensive income (loss) by component for the three months ended September 30, 2014 were as follows:
|
|
Accrued |
|
Foreign |
|
|
|
|
|
||||
|
|
post-retirement |
|
currency |
|
Hedging |
|
|
|
||||
(in millions) |
|
benefit liability(1) |
|
translation |
|
activities(2) |
|
Total |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at June 30, 2014 |
|
$ |
(27.6 |
) |
$ |
(2.6 |
) |
$ |
0.8 |
|
$ |
(29.4 |
) |
Other comprehensive loss before reclassifications |
|
— |
|
(18.1 |
) |
— |
|
(18.1 |
) |
||||
Amounts reclassified from accumulated other comprehensive loss |
|
1.1 |
|
— |
|
(0.2 |
) |
0.9 |
|
||||
Income tax benefit (expense) |
|
(0.4 |
) |
— |
|
0.1 |
|
(0.3 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
Net other comprehensive income (loss) |
|
0.7 |
|
(18.1 |
) |
(0.1 |
) |
(17.5 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at September 30, 2014 |
|
$ |
(26.9 |
) |
$ |
(20.7 |
) |
$ |
0.7 |
|
$ |
(46.9 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Current period amounts related to accrued post-retirement benefit liability are related to amortization of unrecognized actuarial gains and losses which is included in net periodic benefit cost for pension and other post-retirement welfare plans. See Note 13. |
(2) |
Current period amounts related to hedging activities are a reduction to interest expense. See Note 18 in the Company’s 2014 Annual Report on Form 10-K for more information. |
The changes in Accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2015 were as follows:
|
|
Accrued |
|
Foreign |
|
|
|
|
|
||||
|
|
post-retirement |
|
currency |
|
Hedging |
|
|
|
||||
(in millions) |
|
benefit liability(1) |
|
translation |
|
activities(2) |
|
Total |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2014 |
|
$ |
(32.0 |
) |
$ |
(30.4 |
) |
$ |
0.6 |
|
$ |
(61.8 |
) |
Other comprehensive loss before reclassifications |
|
— |
|
(17.7 |
) |
— |
|
(17.7 |
) |
||||
Amounts reclassified from accumulated other comprehensive loss |
|
3.9 |
|
— |
|
(0.4 |
) |
3.5 |
|
||||
Income tax benefit (expense) |
|
(1.5 |
) |
— |
|
0.1 |
|
(1.4 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
Net other comprehensive income (loss) |
|
2.4 |
|
(17.7 |
) |
(0.3 |
) |
(15.6 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at September 30, 2015 |
|
$ |
(29.6 |
) |
$ |
(48.1 |
) |
$ |
0.3 |
|
$ |
(77.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The changes in Accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2014 were as follows:
|
|
Accrued |
|
Foreign |
|
|
|
|
|
||||
|
|
post-retirement |
|
currency |
|
Hedging |
|
|
|
||||
(in millions) |
|
benefit liability(1) |
|
translation |
|
activities(2) |
|
Total |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2013 |
|
$ |
(28.2 |
) |
$ |
(4.3 |
) |
$ |
1.0 |
|
$ |
(31.5 |
) |
Other comprehensive loss before reclassifications |
|
(0.6 |
) |
(16.4 |
) |
— |
|
(17.0 |
) |
||||
Amounts reclassified from accumulated other comprehensive loss |
|
3.1 |
|
— |
|
(0.5 |
) |
2.6 |
|
||||
Income tax benefit (expense) |
|
(1.2 |
) |
— |
|
0.2 |
|
(1.0 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
Net other comprehensive income (loss) |
|
1.3 |
|
(16.4 |
) |
(0.3 |
) |
(15.4 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at September 30, 2014 |
|
$ |
(26.9 |
) |
$ |
(20.7 |
) |
$ |
0.7 |
|
$ |
(46.9 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Current period amounts related to accrued post-retirement benefit liability are related to amortization of unrecognized actuarial gains and losses which is included in net periodic benefit cost for pension and other post-retirement welfare plans. See Note 13. |
(2) |
Current period amounts related to hedging activities are a reduction to interest expense. See Note 18 in the Company’s 2014 Annual Report on Form 10-K for more information. |
|
Three Months Ended September 30, |
|
2015 |
|
2014 |
|
||||||||
(in millions) |
|
Net Sales |
|
EBIT |
|
Net Sales |
|
EBIT |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Carlisle Construction Materials |
|
$ |
570.1 |
|
$ |
115.5 |
|
$ |
589.1 |
|
$ |
97.0 |
|
Carlisle Interconnect Technologies |
|
202.3 |
|
41.2 |
|
164.4 |
|
33.9 |
|
||||
Carlisle Fluid Technologies |
|
67.9 |
|
10.1 |
|
— |
|
— |
|
||||
Carlisle Brake & Friction |
|
70.7 |
|
0.5 |
|
89.3 |
|
6.1 |
|
||||
Carlisle FoodService Products |
|
62.1 |
|
7.7 |
|
61.3 |
|
7.4 |
|
||||
Corporate |
|
— |
|
(13.2 |
) |
— |
|
(10.4 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Total |
|
$ |
973.1 |
|
$ |
161.8 |
|
$ |
904.1 |
|
$ |
134.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
2015 |
|
2014 |
|
||||||||||||||
(in millions) |
|
Net Sales |
|
EBIT |
|
Assets |
|
Net Sales |
|
EBIT |
|
Assets |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Carlisle Construction Materials |
|
$ |
1,519.0 |
|
$ |
264.3 |
|
$ |
1,007.8 |
|
$ |
1,472.2 |
|
$ |
210.0 |
|
$ |
1,033.6 |
|
Carlisle Interconnect Technologies |
|
595.0 |
|
111.8 |
|
1,294.2 |
|
477.5 |
|
98.7 |
|
1,042.1 |
|
||||||
Carlisle Fluid Technologies |
|
129.6 |
|
9.1 |
|
677.1 |
|
— |
|
— |
|
— |
|
||||||
Carlisle Brake & Friction |
|
242.1 |
|
16.8 |
|
579.4 |
|
279.1 |
|
26.1 |
|
602.7 |
|
||||||
Carlisle FoodService Products |
|
181.3 |
|
20.3 |
|
202.7 |
|
185.2 |
|
22.9 |
|
204.2 |
|
||||||
Corporate |
|
— |
|
(46.1 |
) |
314.4 |
|
— |
|
(38.4 |
) |
835.8 |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Total |
|
$ |
2,667.0 |
|
$ |
376.2 |
|
$ |
4,075.6 |
|
$ |
2,414.0 |
|
$ |
319.3 |
|
$ |
3,718.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pro Forma |
|
Pro Forma |
|
||||||||
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
||||||||
(in millions) |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Net sales |
|
$ |
973.1 |
|
$ |
970.3 |
|
$ |
2,728.2 |
|
$ |
2,614.9 |
|
Income from continuing operations |
|
103.6 |
|
91.9 |
|
250.5 |
|
208.9 |
|
|
|
Preliminary |
|
Measurement |
|
Preliminary |
|
|||
|
|
As of |
|
Six Months |
|
As of |
|
|||
(in millions) |
|
4/1/2015 |
|
9/30/2015 |
|
9/30/2015 |
|
|||
Total cash consideration transferred and payable |
|
$ |
610.6 |
|
$ |
0.5 |
|
$ |
611.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Recognized amounts of identifiable assets acquired and liabilities assumed: |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Cash and cash equivalents |
|
$ |
12.2 |
|
$ |
— |
|
$ |
12.2 |
|
Receivables |
|
57.3 |
|
— |
|
57.3 |
|
|||
Inventories |
|
40.9 |
|
— |
|
40.9 |
|
|||
Prepaid expenses and other current assets |
|
6.4 |
|
(0.1 |
) |
6.3 |
|
|||
Property, plant, and equipment |
|
41.0 |
|
(0.2 |
) |
40.8 |
|
|||
Definite-lived intangible assets |
|
216.0 |
|
— |
|
216.0 |
|
|||
Indefinite-lived intangible assets |
|
125.0 |
|
— |
|
125.0 |
|
|||
Deferred income tax assets |
|
1.9 |
|
— |
|
1.9 |
|
|||
Other non-current assets |
|
3.8 |
|
— |
|
3.8 |
|
|||
Line of credit |
|
(1.4 |
) |
— |
|
(1.4 |
) |
|||
Accounts payable |
|
(16.3 |
) |
— |
|
(16.3 |
) |
|||
Income tax payable |
|
(1.9 |
) |
— |
|
(1.9 |
) |
|||
Accrued expenses |
|
(15.6 |
) |
0.3 |
|
(15.3 |
) |
|||
Deferred income tax liabilities |
|
(28.8 |
) |
— |
|
(28.8 |
) |
|||
Other non-current liabilities |
|
(5.6 |
) |
— |
|
(5.6 |
) |
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Total identifiable net assets |
|
434.9 |
|
— |
|
434.9 |
|
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Goodwill |
|
$ |
175.7 |
|
$ |
0.5 |
|
$ |
176.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preliminary |
|
Measurement |
|
Final |
|
|||
|
|
As of |
|
|
|
As of |
|
|||
(in millions) |
|
10/1/2014 |
|
|
|
9/30/2015 |
|
|||
Total cash consideration transferred |
|
$ |
200.7 |
|
$ |
— |
|
$ |
200.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Recognized amounts of identifiable assets acquired and liabilities assumed: |
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Cash and cash equivalents |
|
$ |
6.7 |
|
$ |
— |
|
$ |
6.7 |
|
Receivables |
|
26.9 |
|
— |
|
26.9 |
|
|||
Inventories |
|
17.1 |
|
— |
|
17.1 |
|
|||
Prepaid expenses and other current assets |
|
2.9 |
|
— |
|
2.9 |
|
|||
Property, plant, and equipment |
|
4.5 |
|
— |
|
4.5 |
|
|||
Definite-lived intangible assets |
|
74.5 |
|
— |
|
74.5 |
|
|||
Indefinite-lived intangible assets |
|
6.0 |
|
— |
|
6.0 |
|
|||
Other non-current assets |
|
8.8 |
|
— |
|
8.8 |
|
|||
Accounts payable |
|
(16.9 |
) |
— |
|
(16.9 |
) |
|||
Income tax payable |
|
(0.3 |
) |
— |
|
(0.3 |
) |
|||
Accrued expenses |
|
(4.9 |
) |
(1.1 |
) |
(6.0 |
) |
|||
Net deferred tax liabilities |
|
(16.2 |
) |
— |
|
(16.2 |
) |
|||
Other non-current liabilities |
|
(20.1 |
) |
— |
|
(20.1 |
) |
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Total identifiable net assets |
|
89.0 |
|
(1.1 |
) |
87.9 |
|
|||
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|||
Goodwill |
|
$ |
111.7 |
|
$ |
1.1 |
|
$ |
112.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2015 |
|
2014 |
|
||
Expected dividend yield |
|
1.1 |
% |
1.2 |
% |
||
Expected life in years |
|
5.71 |
|
5.74 |
|
||
Expected volatility |
|
27.3 |
% |
29.3 |
% |
||
Risk-free interest rate |
|
1.4 |
% |
1.7 |
% |
||
Weighted-average fair value |
|
$ |
21.19 |
|
$ |
19.15 |
|
|
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
|
|
|
|
|
|
||
Finished goods |
|
$ |
212.4 |
|
$ |
188.1 |
|
Work-in-process |
|
62.5 |
|
45.3 |
|
||
Raw materials |
|
139.1 |
|
132.2 |
|
||
Reserves |
|
(30.2 |
) |
(26.5 |
) |
||
|
|
|
|
|
|
||
Inventories |
|
$ |
383.8 |
|
$ |
339.1 |
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
Land |
|
$ |
59.2 |
|
$ |
37.1 |
|
Buildings and leasehold improvements |
|
317.5 |
|
284.6 |
|
||
Machinery and equipment |
|
725.8 |
|
690.7 |
|
||
Projects in progress |
|
31.5 |
|
48.6 |
|
||
|
|
|
|
|
|
||
|
|
1,134.0 |
|
1,061.0 |
|
||
Accumulated depreciation |
|
(554.0 |
) |
(513.7 |
) |
||
|
|
|
|
|
|
||
Property, plant, and equipment, net |
|
$ |
580.0 |
|
$ |
547.3 |
|
|
|
|
|
|
|
|
|
|
|
|
Construction |
|
Interconnect |
|
Fluid |
|
Brake and |
|
FoodService |
|
|
|
||||||
(in millions) |
|
Materials |
|
Technologies |
|
Technologies |
|
Friction |
|
Products |
|
Total |
|
||||||
Gross balance at January 1, 2015 |
|
$ |
123.3 |
|
$ |
554.3 |
|
$ |
— |
|
$ |
226.6 |
|
$ |
60.3 |
|
$ |
964.5 |
|
Goodwill acquired during year (1) |
|
— |
|
— |
|
175.7 |
|
— |
|
— |
|
175.7 |
|
||||||
Measurement period adjustments |
|
— |
|
1.1 |
|
0.5 |
|
— |
|
— |
|
1.6 |
|
||||||
Currency translation |
|
(3.4 |
) |
— |
|
(1.2 |
) |
— |
|
— |
|
(4.6 |
) |
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net balance at September 30, 2015 |
|
$ |
119.9 |
|
$ |
555.4 |
|
$ |
175.0 |
|
$ |
226.6 |
|
$ |
60.3 |
|
$ |
1,137.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
See Note 4 for further information on goodwill resulting from recent acquisitions. |
The Company’s Other intangible assets, net at September 30, 2015, were as follows:
|
|
Acquired |
|
Accumulated |
|
Net Book |
|
|||
(in millions) |
|
Cost |
|
Amortization |
|
Value |
|
|||
Assets subject to amortization: |
|
|
|
|
|
|
|
|||
Intellectual property |
|
$ |
174.5 |
|
$ |
(48.3 |
) |
$ |
126.2 |
|
Customer relationships |
|
676.6 |
|
(150.4 |
) |
526.2 |
|
|||
Other |
|
20.7 |
|
(13.1 |
) |
7.6 |
|
|||
Assets not subject to amortization: |
|
|
|
|
|
|
|
|||
Trade names |
|
246.1 |
|
— |
|
246.1 |
|
|||
|
|
|
|
|
|
|
|
|||
Other intangible assets, net |
|
$ |
1,117.9 |
|
$ |
(211.8 |
) |
$ |
906.1 |
|
|
|
|
|
|
|
|
|
|
|
|
The Company’s Other intangible assets, net at December 31, 2014, were as follows:
|
|
Acquired |
|
Accumulated |
|
Net Book |
|
|||
(in millions) |
|
Cost |
|
Amortization |
|
Value |
|
|||
Assets subject to amortization: |
|
|
|
|
|
|
|
|||
Intellectual property |
|
$ |
146.6 |
|
$ |
(37.8 |
) |
$ |
108.8 |
|
Customer relationships |
|
494.6 |
|
(122.3 |
) |
372.3 |
|
|||
Other |
|
20.6 |
|
(12.1 |
) |
8.5 |
|
|||
Assets not subject to amortization: |
|
|
|
|
|
|
|
|||
Trade names |
|
122.1 |
|
— |
|
122.1 |
|
|||
|
|
|
|
|
|
|
|
|||
Other intangible assets, net |
|
$ |
783.9 |
|
$ |
(172.2 |
) |
$ |
611.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
|
|
|
|
|
|
||
Carlisle Construction Materials |
|
$ |
63.6 |
|
$ |
72.3 |
|
Carlisle Interconnect Technologies |
|
364.7 |
|
386.6 |
|
||
Carlisle Fluid Technologies |
|
331.4 |
|
— |
|
||
Carlisle Brake & Friction |
|
118.8 |
|
123.5 |
|
||
Carlisle FoodService Products |
|
27.6 |
|
29.3 |
|
||
|
|
|
|
|
|
||
Total |
|
$ |
906.1 |
|
$ |
611.7 |
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
3.75% notes due 2022, net of unamortized discount of ($0.8) and ($0.9), respectively |
|
$ |
349.2 |
|
$ |
349.1 |
|
5.125% notes due 2020, net of unamortized discount of ($0.6) and ($0.7), respectively |
|
249.4 |
|
249.3 |
|
||
6.125% notes due 2016, net of unamortized discount of ($0.1) and ($0.2), respectively |
|
149.9 |
|
149.8 |
|
||
Revolving credit facility |
|
— |
|
— |
|
||
Industrial development and revenue bonds |
|
— |
|
1.5 |
|
||
Other, including capital lease obligations |
|
0.1 |
|
0.1 |
|
||
|
|
|
|
|
|
||
Total long-term debt |
|
748.6 |
|
749.8 |
|
||
Less 6.125% notes due 2016 classified as current |
|
(149.9 |
) |
— |
|
||
|
|
|
|
|
|
||
Total long-term debt, net of current portion |
|
$ |
598.7 |
|
$ |
749.8 |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
||||||||
|
|
September 30, |
|
September 30, |
|
||||||||
(in millions) |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Service cost |
|
$ |
0.9 |
|
$ |
0.9 |
|
$ |
2.8 |
|
$ |
2.7 |
|
Interest cost |
|
1.8 |
|
1.9 |
|
5.3 |
|
5.8 |
|
||||
Expected return on plan assets |
|
(2.6 |
) |
(2.6 |
) |
(7.8 |
) |
(8.0 |
) |
||||
Amortization of unrecognized loss |
|
1.3 |
|
1.1 |
|
3.9 |
|
3.2 |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Net periodic benefit cost |
|
$ |
1.4 |
|
$ |
1.3 |
|
$ |
4.2 |
|
$ |
3.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred revenue recognized in the Condensed Consolidated Balance Sheets includes the following related to roofing systems extended product warranty contracts:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
Deferred revenue |
|
|
|
|
|
||
Current |
|
$ |
17.7 |
|
$ |
17.5 |
|
Long-term |
|
155.8 |
|
150.7 |
|
||
|
|
|
|
|
|
||
Deferred revenue liability |
|
$ |
173.5 |
|
$ |
168.2 |
|
|
|
|
|
|
|
|
|
Other deferred revenue recognized in the Condensed Consolidated Balance Sheets as of September 30, 2015 and December 31, 2014, primarily related to contracts on systems sales within the Fluid Technologies segment, was as follows:
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
Deferred revenue |
|
|
|
|
|
||
Current |
|
$ |
9.6 |
|
$ |
0.4 |
|
Long-term |
|
0.1 |
|
0.4 |
|
||
|
|
|
|
|
|
||
Deferred revenue liability |
|
$ |
9.7 |
|
$ |
0.8 |
|
|
|
|
|
|
|
|
|
|
(in millions) |
|
2015 |
|
2014 |
|
||
Balance at January 1 |
|
$ |
15.2 |
|
$ |
14.3 |
|
Current year provision |
|
18.9 |
|
15.7 |
|
||
Acquired warranty obligation |
|
1.1 |
|
— |
|
||
Current year claims |
|
(13.2 |
) |
(14.1 |
) |
||
|
|
|
|
|
|
||
Balance at September 30 |
|
$ |
22.0 |
|
$ |
15.9 |
|
|
|
|
|
|
|
|
|
|
|
|
September 30, |
|
December 31, |
|
||
(in millions) |
|
2015 |
|
2014 |
|
||
Deferred taxes and other tax liabilities |
|
$ |
226.2 |
|
$ |
195.4 |
|
Pension and other post-retirement obligations |
|
27.3 |
|
24.8 |
|
||
Long-term workers’ compensation |
|
14.7 |
|
15.7 |
|
||
Deferred compensation |
|
16.3 |
|
14.0 |
|
||
Other |
|
10.8 |
|
10.7 |
|
||
|
|
|
|
|
|
||
Other long-term liabilities |
|
$ |
295.3 |
|
$ |
260.6 |
|
|
|
|
|
|
|
|
|
|
The changes in Accumulated other comprehensive income (loss) by component for the three months ended September 30, 2015 were as follows:
|
|
Accrued |
|
Foreign |
|
|
|
|
|
||||
|
|
post-retirement |
|
currency |
|
Hedging |
|
|
|
||||
(in millions) |
|
benefit liability(1) |
|
translation |
|
activities(2) |
|
Total |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at June 30, 2015 |
|
$ |
(30.4 |
) |
$ |
(38.9 |
) |
$ |
0.4 |
|
$ |
(68.9 |
) |
Other comprehensive loss before reclassifications |
|
— |
|
(9.2 |
) |
— |
|
(9.2 |
) |
||||
Amounts reclassified from accumulated other comprehensive loss |
|
1.3 |
|
— |
|
(0.2 |
) |
1.1 |
|
||||
Income tax benefit (expense) |
|
(0.5 |
) |
— |
|
0.1 |
|
(0.4 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
Net other comprehensive income (loss) |
|
0.8 |
|
(9.2 |
) |
(0.1 |
) |
(8.5 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at September 30, 2015 |
|
$ |
(29.6 |
) |
$ |
(48.1 |
) |
$ |
0.3 |
|
$ |
(77.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The changes in Accumulated other comprehensive income (loss) by component for the three months ended September 30, 2014 were as follows:
|
|
Accrued |
|
Foreign |
|
|
|
|
|
||||
|
|
post-retirement |
|
currency |
|
Hedging |
|
|
|
||||
(in millions) |
|
benefit liability(1) |
|
translation |
|
activities(2) |
|
Total |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at June 30, 2014 |
|
$ |
(27.6 |
) |
$ |
(2.6 |
) |
$ |
0.8 |
|
$ |
(29.4 |
) |
Other comprehensive loss before reclassifications |
|
— |
|
(18.1 |
) |
— |
|
(18.1 |
) |
||||
Amounts reclassified from accumulated other comprehensive loss |
|
1.1 |
|
— |
|
(0.2 |
) |
0.9 |
|
||||
Income tax benefit (expense) |
|
(0.4 |
) |
— |
|
0.1 |
|
(0.3 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
Net other comprehensive income (loss) |
|
0.7 |
|
(18.1 |
) |
(0.1 |
) |
(17.5 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at September 30, 2014 |
|
$ |
(26.9 |
) |
$ |
(20.7 |
) |
$ |
0.7 |
|
$ |
(46.9 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Current period amounts related to accrued post-retirement benefit liability are related to amortization of unrecognized actuarial gains and losses which is included in net periodic benefit cost for pension and other post-retirement welfare plans. See Note 13. |
(2) |
Current period amounts related to hedging activities are a reduction to interest expense. See Note 18 in the Company’s 2014 Annual Report on Form 10-K for more information. |
The changes in Accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2015 were as follows:
|
|
Accrued |
|
Foreign |
|
|
|
|
|
||||
|
|
post-retirement |
|
currency |
|
Hedging |
|
|
|
||||
(in millions) |
|
benefit liability(1) |
|
translation |
|
activities(2) |
|
Total |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2014 |
|
$ |
(32.0 |
) |
$ |
(30.4 |
) |
$ |
0.6 |
|
$ |
(61.8 |
) |
Other comprehensive loss before reclassifications |
|
— |
|
(17.7 |
) |
— |
|
(17.7 |
) |
||||
Amounts reclassified from accumulated other comprehensive loss |
|
3.9 |
|
— |
|
(0.4 |
) |
3.5 |
|
||||
Income tax benefit (expense) |
|
(1.5 |
) |
— |
|
0.1 |
|
(1.4 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
Net other comprehensive income (loss) |
|
2.4 |
|
(17.7 |
) |
(0.3 |
) |
(15.6 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at September 30, 2015 |
|
$ |
(29.6 |
) |
$ |
(48.1 |
) |
$ |
0.3 |
|
$ |
(77.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The changes in Accumulated other comprehensive income (loss) by component for the nine months ended September 30, 2014 were as follows:
|
|
Accrued |
|
Foreign |
|
|
|
|
|
||||
|
|
post-retirement |
|
currency |
|
Hedging |
|
|
|
||||
(in millions) |
|
benefit liability(1) |
|
translation |
|
activities(2) |
|
Total |
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at December 31, 2013 |
|
$ |
(28.2 |
) |
$ |
(4.3 |
) |
$ |
1.0 |
|
$ |
(31.5 |
) |
Other comprehensive loss before reclassifications |
|
(0.6 |
) |
(16.4 |
) |
— |
|
(17.0 |
) |
||||
Amounts reclassified from accumulated other comprehensive loss |
|
3.1 |
|
— |
|
(0.5 |
) |
2.6 |
|
||||
Income tax benefit (expense) |
|
(1.2 |
) |
— |
|
0.2 |
|
(1.0 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
Net other comprehensive income (loss) |
|
1.3 |
|
(16.4 |
) |
(0.3 |
) |
(15.4 |
) |
||||
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||
Balance at September 30, 2014 |
|
$ |
(26.9 |
) |
$ |
(20.7 |
) |
$ |
0.7 |
|
$ |
(46.9 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Current period amounts related to accrued post-retirement benefit liability are related to amortization of unrecognized actuarial gains and losses which is included in net periodic benefit cost for pension and other post-retirement welfare plans. See Note 13. |
(2) |
Current period amounts related to hedging activities are a reduction to interest expense. See Note 18 in the Company’s 2014 Annual Report on Form 10-K for more information. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|