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June 30, 2015 | December 31, 2014 | ||||||
Inventories, net: | |||||||
Manufacturing supplies | $44.7 | $38.5 | |||||
Raw materials | 35.6 | 56.8 | |||||
Work in process | 74.4 | 110.3 | |||||
Finished products | 77.7 | 91.1 | |||||
Subtotal | 232.4 | 296.7 | |||||
Allowance for surplus and obsolete inventory | (2.9 | ) | (2.9 | ) | |||
Total Inventories, net | $229.5 | $293.8 |
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June 30, 2015 | December 31, 2014 | ||||||
Property, Plant and Equipment, net: | |||||||
Land and buildings | $356.8 | $292.4 | |||||
Machinery and equipment | 1,347.1 | 1,183.0 | |||||
Construction in progress | 77.6 | 288.3 | |||||
Subtotal | 1,781.5 | 1,763.7 | |||||
Less allowances for depreciation | (1,017.0 | ) | (991.8 | ) | |||
Property, Plant and Equipment, net | $764.5 | $771.9 |
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June 30, 2015 | December 31, 2014 | ||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||
Intangible Assets Subject to Amortization: | |||||||||||||||||||||||
Customer relationships | $6.8 | $2.6 | $4.2 | $6.8 | $2.4 | $4.4 | |||||||||||||||||
Technology use | 9.0 | 4.4 | 4.6 | 9.0 | 4.1 | 4.9 | |||||||||||||||||
Capitalized software | 55.0 | 32.2 | 22.8 | 50.6 | 29.6 | 21.0 | |||||||||||||||||
Total Intangible Assets | $70.8 | $39.2 | $31.6 | $66.4 | $36.1 | $30.3 |
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June 30, 2015 | December 31, 2014 | ||||||
Variable-rate State of Ohio Water Development Revenue Refunding Bonds, maturing on November 1, 2025 (0.07% as of June 30, 2015) | $12.2 | $12.2 | |||||
Variable-rate State of Ohio Air Quality Development Revenue Refunding Bonds, maturing on November 1, 2025 (0.07% as of June 30, 2015) | 9.5 | 9.5 | |||||
Variable-rate State of Ohio Pollution Control Revenue Refunding Bonds, maturing on June 1, 2033 (0.08% as of June 30, 2015) | 8.5 | 8.5 | |||||
Revolving credit facility, due 2019 (LIBOR plus applicable spread) | 145.0 | 155.0 | |||||
Total Long-Term Debt | $175.2 | $185.2 |
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Foreign Currency Translation Adjustments | Pension and Postretirement Liability Adjustments | Total | |||||||||
Balance at December 31, 2014 | ($4.8 | ) | ($292.5 | ) | ($297.3 | ) | |||||
Other comprehensive loss before reclassifications, before income tax | — | (0.1 | ) | (0.1 | ) | ||||||
Amounts reclassified from accumulated other comprehensive loss, before income tax | — | 17.6 | 17.6 | ||||||||
Income taxes | — | (6.4 | ) | (6.4 | ) | ||||||
Net current period other comprehensive income, net of income tax | — | 11.1 | 11.1 | ||||||||
Balance at June 30, 2015 | ($4.8 | ) | ($281.4 | ) | ($286.2 | ) |
Foreign Currency Translation Adjustments | Pension and Postretirement Liability Adjustments | Total | |||||||||
Balance at December 31, 2013 | ($0.4 | ) | $— | ($0.4 | ) | ||||||
Net transfer from Timken | (3.2 | ) | (233.9 | ) | (237.1 | ) | |||||
Other comprehensive income before reclassifications, before income tax | 0.4 | — | 0.4 | ||||||||
Amounts reclassified from accumulated other comprehensive loss, before income tax | — | 4.6 | 4.6 | ||||||||
Income taxes | — | (1.7 | ) | (1.7 | ) | ||||||
Net current period other comprehensive income, net of income tax | 0.4 | 2.9 | 3.3 | ||||||||
Balance at June 30, 2014 | ($3.2 | ) | ($231.0 | ) | ($234.2 | ) |
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Total | Additional Paid-in Capital | Retained (Deficit) Earnings | Treasury Shares | Accumulated Other Comprehensive Loss | |||||||||||||||
Balance as of December 31, 2014 | $748.1 | $1,050.7 | $29.4 | ($34.7 | ) | ($297.3 | ) | ||||||||||||
Net loss | (17.4 | ) | — | (17.4 | ) | — | — | ||||||||||||
Pension and postretirement adjustment, net of tax | 11.1 | — | — | — | 11.1 | ||||||||||||||
Stock-based compensation expense | 4.8 | 4.8 | — | — | — | ||||||||||||||
Dividends – $0.28 per share | (12.5 | ) | — | (12.5 | ) | — | — | ||||||||||||
Net transfer to Timken and subsidiaries | (0.5 | ) | (0.5 | ) | — | — | — | ||||||||||||
Stock option exercise activity | 1.3 | 1.3 | — | — | — | ||||||||||||||
Purchase of treasury shares | (2.9 | ) | — | — | (2.9 | ) | — | ||||||||||||
Issuance of treasury shares | — | (5.5 | ) | — | 5.5 | — | |||||||||||||
Shares surrendered for taxes | (2.1 | ) | — | — | (2.1 | ) | — | ||||||||||||
Balance as of June 30, 2015 | $729.9 | $1,050.8 | ($0.5 | ) | ($34.2 | ) | ($286.2 | ) |
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Three Months Ended June 30, 2015 | Three Months Ended June 30, 2014 | ||||||||||||||
Components of net periodic benefit cost: | Pension | Postretirement | Pension | Postretirement | |||||||||||
Service cost | $4.1 | $0.5 | $2.6 | $0.3 | |||||||||||
Interest cost | 12.7 | 2.3 | 7.8 | 1.6 | |||||||||||
Expected return on plan assets | (19.9 | ) | (1.7 | ) | (12.1 | ) | (1.1 | ) | |||||||
Amortization of prior service cost | 0.2 | 0.2 | 0.1 | 0.1 | |||||||||||
Amortization of net actuarial loss | 8.2 | (0.1 | ) | 4.4 | — | ||||||||||
Allocated benefit cost from Timken | — | — | 0.8 | 0.5 | |||||||||||
Net Periodic Benefit Cost | $5.3 | $1.2 | $3.6 | $1.4 |
Six Months Ended June 30, 2015 | Six Months Ended June 30, 2014 | ||||||||||||||
Components of net periodic benefit cost: | Pension | Postretirement | Pension | Postretirement | |||||||||||
Service cost | $8.3 | $0.9 | $2.6 | $0.3 | |||||||||||
Interest cost | 25.7 | 4.7 | 7.8 | 1.6 | |||||||||||
Expected return on plan assets | (38.7 | ) | (3.4 | ) | (12.1 | ) | (1.1 | ) | |||||||
Amortization of prior service cost | 0.3 | 0.5 | 0.1 | 0.1 | |||||||||||
Amortization of net actuarial loss | 16.8 | — | 4.4 | — | |||||||||||
Allocated benefit cost from Timken | — | — | 5.2 | 2.2 | |||||||||||
Net Periodic Benefit Cost | $12.4 | $2.7 | $8.0 | $3.1 |
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Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net Sales: | |||||||||||||||
Industrial & Mobile | $211.1 | $254.7 | $444.6 | $486.5 | |||||||||||
Energy & Distribution | 67.1 | 187.5 | 222.3 | 345.2 | |||||||||||
$278.2 | $442.2 | $666.9 | $831.7 | ||||||||||||
Segment EBIT: | |||||||||||||||
Industrial & Mobile | ($18.8 | ) | $20.1 | ($14.3 | ) | $47.4 | |||||||||
Energy & Distribution | (21.0 | ) | 28.2 | (16.4 | ) | 56.4 | |||||||||
Total Segment EBIT | ($39.8 | ) | $48.3 | ($30.7 | ) | $103.8 | |||||||||
Unallocated (1) | 1.9 | (3.2 | ) | 4.0 | (7.9 | ) | |||||||||
Interest expense | (1.0 | ) | (0.7 | ) | (1.1 | ) | (0.7 | ) | |||||||
(Loss) Income Before Income Taxes | ($38.9 | ) | $44.4 | ($27.8 | ) | $95.2 |
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Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
(Benefit) provision for income taxes | ($14.6 | ) | $15.8 | ($10.4 | ) | $32.9 | |||||||||
Effective tax rate | 37.5 | % | 35.6 | % | 37.4 | % | 34.6 | % |
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Balance at December 31, 2014 | $1.3 | ||
Expenses | — | ||
Payments | (0.2 | ) | |
Balance at June 30, 2015 | $1.1 |
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Balance at December 31, 2014 | $— | ||
Expenses | 1.6 | ||
Payments | (0.6 | ) | |
Balance at June 30, 2015 | $1.0 |
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June 30, 2015 | December 31, 2014 | ||||||
Inventories, net: | |||||||
Manufacturing supplies | $44.7 | $38.5 | |||||
Raw materials | 35.6 | 56.8 | |||||
Work in process | 74.4 | 110.3 | |||||
Finished products | 77.7 | 91.1 | |||||
Subtotal | 232.4 | 296.7 | |||||
Allowance for surplus and obsolete inventory | (2.9 | ) | (2.9 | ) | |||
Total Inventories, net | $229.5 | $293.8 |
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June 30, 2015 | December 31, 2014 | ||||||
Property, Plant and Equipment, net: | |||||||
Land and buildings | $356.8 | $292.4 | |||||
Machinery and equipment | 1,347.1 | 1,183.0 | |||||
Construction in progress | 77.6 | 288.3 | |||||
Subtotal | 1,781.5 | 1,763.7 | |||||
Less allowances for depreciation | (1,017.0 | ) | (991.8 | ) | |||
Property, Plant and Equipment, net | $764.5 | $771.9 |
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June 30, 2015 | December 31, 2014 | ||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||||||||
Intangible Assets Subject to Amortization: | |||||||||||||||||||||||
Customer relationships | $6.8 | $2.6 | $4.2 | $6.8 | $2.4 | $4.4 | |||||||||||||||||
Technology use | 9.0 | 4.4 | 4.6 | 9.0 | 4.1 | 4.9 | |||||||||||||||||
Capitalized software | 55.0 | 32.2 | 22.8 | 50.6 | 29.6 | 21.0 | |||||||||||||||||
Total Intangible Assets | $70.8 | $39.2 | $31.6 | $66.4 | $36.1 | $30.3 |
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June 30, 2015 | December 31, 2014 | ||||||
Variable-rate State of Ohio Water Development Revenue Refunding Bonds, maturing on November 1, 2025 (0.07% as of June 30, 2015) | $12.2 | $12.2 | |||||
Variable-rate State of Ohio Air Quality Development Revenue Refunding Bonds, maturing on November 1, 2025 (0.07% as of June 30, 2015) | 9.5 | 9.5 | |||||
Variable-rate State of Ohio Pollution Control Revenue Refunding Bonds, maturing on June 1, 2033 (0.08% as of June 30, 2015) | 8.5 | 8.5 | |||||
Revolving credit facility, due 2019 (LIBOR plus applicable spread) | 145.0 | 155.0 | |||||
Total Long-Term Debt | $175.2 | $185.2 |
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Foreign Currency Translation Adjustments | Pension and Postretirement Liability Adjustments | Total | |||||||||
Balance at December 31, 2014 | ($4.8 | ) | ($292.5 | ) | ($297.3 | ) | |||||
Other comprehensive loss before reclassifications, before income tax | — | (0.1 | ) | (0.1 | ) | ||||||
Amounts reclassified from accumulated other comprehensive loss, before income tax | — | 17.6 | 17.6 | ||||||||
Income taxes | — | (6.4 | ) | (6.4 | ) | ||||||
Net current period other comprehensive income, net of income tax | — | 11.1 | 11.1 | ||||||||
Balance at June 30, 2015 | ($4.8 | ) | ($281.4 | ) | ($286.2 | ) |
Foreign Currency Translation Adjustments | Pension and Postretirement Liability Adjustments | Total | |||||||||
Balance at December 31, 2013 | ($0.4 | ) | $— | ($0.4 | ) | ||||||
Net transfer from Timken | (3.2 | ) | (233.9 | ) | (237.1 | ) | |||||
Other comprehensive income before reclassifications, before income tax | 0.4 | — | 0.4 | ||||||||
Amounts reclassified from accumulated other comprehensive loss, before income tax | — | 4.6 | 4.6 | ||||||||
Income taxes | — | (1.7 | ) | (1.7 | ) | ||||||
Net current period other comprehensive income, net of income tax | 0.4 | 2.9 | 3.3 | ||||||||
Balance at June 30, 2014 | ($3.2 | ) | ($231.0 | ) | ($234.2 | ) |
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Total | Additional Paid-in Capital | Retained (Deficit) Earnings | Treasury Shares | Accumulated Other Comprehensive Loss | |||||||||||||||
Balance as of December 31, 2014 | $748.1 | $1,050.7 | $29.4 | ($34.7 | ) | ($297.3 | ) | ||||||||||||
Net loss | (17.4 | ) | — | (17.4 | ) | — | — | ||||||||||||
Pension and postretirement adjustment, net of tax | 11.1 | — | — | — | 11.1 | ||||||||||||||
Stock-based compensation expense | 4.8 | 4.8 | — | — | — | ||||||||||||||
Dividends – $0.28 per share | (12.5 | ) | — | (12.5 | ) | — | — | ||||||||||||
Net transfer to Timken and subsidiaries | (0.5 | ) | (0.5 | ) | — | — | — | ||||||||||||
Stock option exercise activity | 1.3 | 1.3 | — | — | — | ||||||||||||||
Purchase of treasury shares | (2.9 | ) | — | — | (2.9 | ) | — | ||||||||||||
Issuance of treasury shares | — | (5.5 | ) | — | 5.5 | — | |||||||||||||
Shares surrendered for taxes | (2.1 | ) | — | — | (2.1 | ) | — | ||||||||||||
Balance as of June 30, 2015 | $729.9 | $1,050.8 | ($0.5 | ) | ($34.2 | ) | ($286.2 | ) |
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Three Months Ended June 30, 2015 | Three Months Ended June 30, 2014 | ||||||||||||||
Components of net periodic benefit cost: | Pension | Postretirement | Pension | Postretirement | |||||||||||
Service cost | $4.1 | $0.5 | $2.6 | $0.3 | |||||||||||
Interest cost | 12.7 | 2.3 | 7.8 | 1.6 | |||||||||||
Expected return on plan assets | (19.9 | ) | (1.7 | ) | (12.1 | ) | (1.1 | ) | |||||||
Amortization of prior service cost | 0.2 | 0.2 | 0.1 | 0.1 | |||||||||||
Amortization of net actuarial loss | 8.2 | (0.1 | ) | 4.4 | — | ||||||||||
Allocated benefit cost from Timken | — | — | 0.8 | 0.5 | |||||||||||
Net Periodic Benefit Cost | $5.3 | $1.2 | $3.6 | $1.4 |
Six Months Ended June 30, 2015 | Six Months Ended June 30, 2014 | ||||||||||||||
Components of net periodic benefit cost: | Pension | Postretirement | Pension | Postretirement | |||||||||||
Service cost | $8.3 | $0.9 | $2.6 | $0.3 | |||||||||||
Interest cost | 25.7 | 4.7 | 7.8 | 1.6 | |||||||||||
Expected return on plan assets | (38.7 | ) | (3.4 | ) | (12.1 | ) | (1.1 | ) | |||||||
Amortization of prior service cost | 0.3 | 0.5 | 0.1 | 0.1 | |||||||||||
Amortization of net actuarial loss | 16.8 | — | 4.4 | — | |||||||||||
Allocated benefit cost from Timken | — | — | 5.2 | 2.2 | |||||||||||
Net Periodic Benefit Cost | $12.4 | $2.7 | $8.0 | $3.1 |
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Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net Sales: | |||||||||||||||
Industrial & Mobile | $211.1 | $254.7 | $444.6 | $486.5 | |||||||||||
Energy & Distribution | 67.1 | 187.5 | 222.3 | 345.2 | |||||||||||
$278.2 | $442.2 | $666.9 | $831.7 | ||||||||||||
Segment EBIT: | |||||||||||||||
Industrial & Mobile | ($18.8 | ) | $20.1 | ($14.3 | ) | $47.4 | |||||||||
Energy & Distribution | (21.0 | ) | 28.2 | (16.4 | ) | 56.4 | |||||||||
Total Segment EBIT | ($39.8 | ) | $48.3 | ($30.7 | ) | $103.8 | |||||||||
Unallocated (1) | 1.9 | (3.2 | ) | 4.0 | (7.9 | ) | |||||||||
Interest expense | (1.0 | ) | (0.7 | ) | (1.1 | ) | (0.7 | ) | |||||||
(Loss) Income Before Income Taxes | ($38.9 | ) | $44.4 | ($27.8 | ) | $95.2 |
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Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
(Benefit) provision for income taxes | ($14.6 | ) | $15.8 | ($10.4 | ) | $32.9 | |||||||||
Effective tax rate | 37.5 | % | 35.6 | % | 37.4 | % | 34.6 | % |
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Balance at December 31, 2014 | $1.3 | ||
Expenses | — | ||
Payments | (0.2 | ) | |
Balance at June 30, 2015 | $1.1 |
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Balance at December 31, 2014 | $— | ||
Expenses | 1.6 | ||
Payments | (0.6 | ) | |
Balance at June 30, 2015 | $1.0 |
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