UNITED STATES
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
FORM10-K
(Mark One)
☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 20172022


OR
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 1-34036
John Bean Technologies Corporation
(Exact name of registrant as specified in its charter)
Delaware91-1650317
(State or other jurisdiction of

incorporation or organization)
(I.R.S. Employer

Identification Number)
70 West Madison Street
Chicago, IL 60602
(Address of principal executive offices)
(312) 861-5900
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each ClassTrading symbol(s)Name of Exchange on Which Registered
Common Stock, $0.01 par value
Preferred Share Purchase Rights
JBT
New York Stock Exchange
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer as defined in Rule 405 of the Securities Act.    Yes ☒    No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes ☐    No ☒
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒     No  ☐
Indicate by check mark whether the registrant has submitted electronically, and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes   ☒   No ☐
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  ☒
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☒☒Accelerated filer ☐☐
Non-accelerated filer ☐☐Smaller reporting company ☐☐
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☒    No  ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes ☐    No  ☒
The aggregate market value of common stock held by non-affiliates of the registrant on the last business day of the registrant’s most recently completed second fiscal quarter was: $3,034,429,468.$3,477,994,143.
At February 26, 2018,16, 2023, there were 31,577,18231,805,199 shares of the registrant’s common stock outstanding.



DOCUMENTS INCORPORATED BY REFERENCE


Portions of the registrant’s Proxy Statement for the 20182023 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein.



TABLE OF CONTENTS

Page
45
1211
2324
2425
2526
2527
2628
2730
2931
4441
4543
8187
8188
8489
90
8491
8492
8493
8494
8495
8596
Item 16. Form 10-K Summary
94101
94102

2

SPECIAL NOTE ABOUT FORWARD-LOOKING STATEMENTS


This Annual Report on Form 10-K and other materials filed or to be filed by John Bean Technologies Corporation,us with the Securities and Exchange Commission, as well as information in oral statements or other written statements made or to be made by us, contain statements that are, or may be considered to be, forward-looking statements. All statements that are not historical facts, including statements about our beliefs or expectations, regarding future performance, strategic plans, income, earnings, cash flows, restructuring and optimization plans and related cost savings, operating improvements, and covenant compliance are forward-looking statements. You can identify these forward-looking statements by the use of forward-looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” “foresees” or the negative version of those words or other comparable words and phrases. Any forward-looking statements contained in this Annual Report on Form 10-K are based upon our historical performance and on current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. There areThese forward-looking statements include, among others, statements relating to the expected impact of the COVID-19 pandemic on our business and our results of operations, our plans to mitigate the impact of the pandemic, our strategic plans, our restructuring plans and expected cost savings from those plans, our outlook and guidance, and our liquidity and our covenant compliance. The factors that could cause our actual results to differ materially from these forward-looking statements, includingexpectations include but are not limited to the factors we describe herein, including under “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and the following factors:


Fluctuations•higher energy and other input costs adversely impacting financial condition of our customers, especially in Europe, and demand for our goods and services from our customers;
•the effects of any resurgence in the COVID-19 pandemic on our ability to operate our business and facilities, on our customers, on our workforce resulting in illness or higher labor turnover, on our supply chains due to extended delivery times and higher freight costs, and on the economy generally;
•fluctuations in our financial results;
Unanticipated•unanticipated delays or acceleration in our sales cycles;
Deterioration•deterioration of economic conditions;
Sensitivity of segments to variable or volatile factors;
Changes in demand for our products and services;
Changes in commodity prices, including those impacting materials used in our business;
Disruptions•disruptions in the political, regulatory, economic and social conditions of the foreign countries in which we conduct business;
Increases•changes to trade regulation, quotas, duties or tariffs;
•risks associated with acquisitions or strategic investments;
•fluctuations in currency exchange rates;
•increases in energy prices;or raw material prices, freight costs, and inflationary pressures;
Changes•changes in food consumption patterns;
Impacts•impacts of pandemic illnesses, food borne illnesses and diseases to various agricultural products;
Weather•weather conditions and natural disasters;
Acts•impact of terrorism or war;climate change and environmental protection initiatives;
Termination or loss of major customer contracts;
Customer sourcing initiatives;
Competition and innovation in •our industries;
Our ability to develop and introduce new or enhanced products and services;
Difficulty in developing, preserving and protecting our intellectual property;
Our ability to protect our information systems;
Adequacy of our internal controls;
Our ability to successfully integrate, operate and manage acquired businesses and assets;
Loss of key management and other personnel;
Potential liability arising out of the installation or use of our systems;
Our ability to comply with the laws and regulations governing our U.S. government contracts;
Our•acts of terrorism or war;
•termination or loss of major customer contracts and risks associated with fixed-price contracts, particularly during periods of high inflation;
•customer sourcing initiatives;
•competition and innovation in our industries;
•difficulty in implementing our business strategies, including the timing of our previously announced review of strategic alternatives for the AeroTech platform, our ability to identify or develop any strategic alternatives, execute on material aspects of such strategic alternatives, and whether we can achieve the potential benefits of such strategic alternatives;
•our ability to develop and introduce new or enhanced products and services and keep pace with technological developments;
•difficulty in developing, preserving and protecting our intellectual property or defending claims of infringement;
•catastrophic loss at any of our facilities and business continuity of our information systems;
•cyber-security risks such as network intrusion or ransomware schemes;
•loss of key management and other personnel;
•potential liability arising out of the installation or use of our systems;
•our ability to comply with U.S. and international laws governing our operations and industries;
The outcome of pending or future litigation;
Increases•increases in tax liabilities;
Difficulty•work stoppages;
•fluctuations in implementing our business strategies;interest rates and returns on pension assets;
Availability•availability of and access to financial and other resources.resources; and

•the factors described under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Annual Report on Form 10-K.

If one or more of those or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may vary materially from what we projected. Consequently, actual events and results may vary significantly from those included in or contemplated or implied by our forward-looking statements. The forward-looking statements included in this Annual Report on Form 10-K are made only as of the date hereof, and we undertake no obligation to publicly update or reviewrevise any forward-looking statement
3

made by us or on our behalf, whether as a result of new information, future developments, subsequent events or changes in circumstances or otherwise.


PART I


Unless otherwise specified or indicated by the context, JBT Corporation, JBT, we, us, our and the Company refer to John Bean Technologies Corporation and its subsidiaries.
4

ITEM 1.    BUSINESS


GENERAL

We operate our business through two segments, FoodTech and AeroTech. We are a leading global technology solutions and service provider to high-value segments of the food, beverage, and beverage industry with focus on proteins, liquid foodsaviation support industry. Through our FoodTech segment, our mission is to make better use of the world’s precious resources by providing solutions that substantially enhance our customers’ success, and automated system solutions. JBT designs, producesin doing so design, produce and servicesservice sophisticated and critical products and systems for multi-nationalfood and regional customers through its FoodTech segment.beverage companies that improve yields and boost efficiency. JBT also sells critical equipment and services to domestic and international air transportation customers through itsour AeroTech segment. Both segments operate globally and serve multi-national and regional markets.

The product offerings of our FoodTech businesses include:

Protein. Providing comprehensive solutions to our customers, our Protein technology offerings include chilling, mixing/grinding, injecting, marinating, tumbling, portioning, packaging, coating, frying, freezing, weighing, X-ray food inspection, and packaging systems for poultry, beef, pork and seafood, as well as ready-to-eat meals, fruits, vegetables, dairy, and bakery products.

Liquid Foods. Our Liquid Foods portfolio includes fruit and juice solutions that extract, concentrate and aseptically process citrus, tomato and other fruits, vegetables, and juices. It also includes in-container solutions for the filling, closing and preservation of fruits, vegetables, soups, sauces, dairy, and pet food products as well as ready-to-eat meals in a wide variety of modern packages. Strategic acquisitions completed in 2017 added significant capabilities in the powder filling and high pressure processing segments to our product portfolio.

Automated Systems. We also provide stand-alone, fully-integrated, and dual-mode robotic automated guided vehicle systems for material movement requirements with a wide variety of applications including manufacturing and warehouse facilities.

JBT AeroTech markets its solutions and services to domestic and international airport authorities, passenger airlines, airfreight and ground handling companies, military forces and defense contractors. The product offerings of our AeroTech businesses include:

Mobile Equipment. JBT AeroTech’s portfolio of mobile air transportation equipment includes commercial and military cargo loading, aircraft deicing, aircraft towing, and aircraft ground power and cooling systems.

Fixed Equipment. JBT AeroTech provides gate equipment for passenger boarding.

Airport Services. JBT AeroTech also maintains the maintenance of airport equipment, systems, and facilities.

For financial information about our business segments see Note 16. Business Segments of our Consolidated Financial Statements included in Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K.


We were originally incorporated as Frigoscandia, Inc. in Delaware in May 1994. Our principal executive offices are located at 70 West Madison, Suite 4400, Chicago, Illinois 60602.


BUSINESS SEGMENTSSegment sales, operating results and additional financial data and commentary are provided in the Segment Analysis section in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Note 19. of the Notes to Consolidated Financial Statements in Part II, Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K.


JBT FoodTechDESCRIPTION OF BUSINESS


JBT FoodTech supplies both customized industrial and turnkey solutionsProducts and services used in

FoodTech provides comprehensive solutions throughout the food production value chain that includes:

•Food and Beverage Solutions. Our equipment offerings include primary, secondary and further value-added processing, including chilling, mixing/grinding, injecting, blending, marinating, tumbling, flattening, forming, portioning, coating, cooking, frying, freezing, extracting, pasteurizing, sterilizing, concentrating, high pressure processing, weighing, inspecting, filling, closing, sealing, and packaging, which support a large and growing portfolio of food, beverage, industry. We design, manufacture and service technologically sophisticated food processinghealth end markets.

•Automated Guided Vehicle Systems. Our Automated Guided Vehicle Systems offerings include stand-alone, fully-integrated, and dual-mode robotic systems for the preparation of meat, seafood and poultry products, ready-to-eat meals, shelf stable packaged foods, bakery products, juice and dairy products, and fruit and vegetable products.

We believe our success is derived from our continued innovation, applying our differentiated and proprietary technologies to meet our customers’ food processing needs. We continually strive to improve our existing solutions and develop new solutions by working closelymaterial movement requirements with our customers to meet their evolving needs.

Our historically strong position in the markets we serve has provided us with a large installed base of systems and equipment. We deliver industrial capacity equipment which includes freezers, citrus juice extractors, preservation systems, coating systems and

packaging systems. The installed base of our equipment provides a stream of recurring revenue from aftermarket products, parts, services, and lease arrangements. Recurring revenue accounted for 41.5% of our FoodTech total revenue in 2017. Our installed base also provides us with strong, long-term customer relationships from which we derive information for new product development to meet the evolving needs of our food processing customers. We also provide stand-alone and fully integrated automated guided vehicle systems for repetitive material handling requirements, for example in manufacturing and warehouse facilities.

We have operations strategically positioned around the world to serve our existing JBT FoodTech equipment base located in more than 100 countries. Our principal production facilities are located in the United States (Arkansas, California, Florida, New York, North Carolina, Ohio, and Wisconsin), Brazil, Belgium, Germany, Italy, Sweden, the Netherlands, the United Kingdom, South Africa and China. In addition to sales and services offices based in more than 25 countries, we also support our customers in their development of new food products and processes as well as the refinement and testing of their current applications through eleven technical centers located in the United States (California, Florida, and Ohio), Mexico, Brazil, Belgium, Italy, Spain, Sweden, the Netherlands and China. Our global presence allows us to provide direct customized support to customers virtually anywhere they process foods.

Solutions, Products and Services

We offer a broad portfolio of systems, equipment and services to our customers which are often sold as part of a fully integrated processing line solution. Our systems are typically customized to meet the specific customer application needs. Thus, actual production capacity ranges vary and are dependent on the food and product packaging type being processed.

Protein. Our fully integrated processing lines often span from the initial point of entry of raw products through further processing. Our Protein systems include Wolf-Tec Polar Dissolver brine preparation, IMAX injection, Polar Massager marination, Polar Flex Carve maceration, TMAX tenderization, TVI portion cutting systems, the DSI™ waterjet portioners, slicers and attribute scanner/sorters; the Stein™ coating and seasoning applicators, teflon coated Formcook Contact and Combi Cookers, THERMoFIN® fryers, GYRoCOMPACT® spiral ovens, JSO Jet Stream® ovens; Double D™ Revoband™ linear ovens and cooking systems; Novus X-ray systems; C.A.T. FATCAT chillers, ULTRACAT injectors, scales and weighing systems, GLACIERCAT freezers and Tipper Tie Clip packaging systems. Although our solutions are primarily used in the processing of meat and poultry (including nuggets, strips, and wings), we also provide systems that portion, coat or cook other food products ranging from breads and pizzas, seafood, and ready-to-eat meals to pet food. Through our acquisition of Tipper Tie, Inc. we also serve industrial, non-food customers, primarily in the adhesives, glues, silicone and industrial explosives industries.

With our first commercial food processing developed in the 1960s, we remain a leading supplier of freezing and chilling solutions to the food processing industry. We design, assemble, test, and install industry-leading technologies under the Frigoscandia® brand, which include the GYRoCOMPACT® self-stacking spiral, the FLoFREEZE® individual quick freezing (IQF) system, and the ADVANTEC™ linear/impingement freezing system, as well as flat product and contact freezers, chillers and proofers. We also offer a structure-supported Northfield SuperTRAK® spiral freezer for high volume, large packaged products. Our freezers are designed to meet the most stringent demands for quality, economy, food safety and user-friendliness. Our industrial freezers can be found in plants processing food products ranging from meat, seafood, and poultry to bakery products and ready-to-eat meals, fruits, vegetables, and dairy products.

Protein technology offerings accounted for 34% of our total revenue in 2017.

Liquid Foods. We offer comprehensive processing lines from primary juice extraction through end of line packaging. In the primary space, we supply industrial citrus, tropical and temperate fruit processing equipment. Our citrus processing solutions include citrus extractors, finishers, pulp systems, evaporators, and citrus ingredient recovery systems as well as aseptic systems (including sterilizers, fillers, and controls) integrated with bulk aseptic storage systems for not-from-concentrate orange juice. Our READYGo™ family of skid-mounted products includes solutions for aseptic sterilization and bulk filling, as well as ingredients and by-products recovery and clean-up systems. In addition to our high capacity industrial extractors, we also offer point of use Fresh’n Squeeze® produce juicers. These juicers are used around the world in hotels, restaurants, coffee shops, grocery stores, convenience stores, quick service restaurants, and juice bars.

We are among the leading worldwide suppliers of fruit, vegetable, and juice processing equipment and aseptic sterilization and bulk filling systems. Our fruit, vegetable, and juice processing lines are comprised of extraction, finishing, heating and mixing equipment, enzyme inactivators, evaporators, flash coolers, sterilizers, and aseptic fillers. Our equipment is primarily sold as an integrated processing line, but can also satisfy a specific need within a line. Our tomato processing lines are installed with processors throughout the world’s key tomato growing regions and produce a range of finished tomato products including tomato paste, concentrates, peeled tomato products, diced tomatoes, salsa, pizza sauce, ketchup, and pureed and crushed tomatoes. Our

aseptic processing lines are used in the bulk processing of a wide range of temperate and tropical fruits into juices, particulates, purees, and concentrates. These fruit products are used as ingredients for dairy products (yogurts, smoothies, flavored milk, and ice cream), bakery products, and fruit-based beverages.
We provide technology solutions and products to extend the life, improve the appearance and preserve the taste of fresh fruits and vegetables. Once protected, fresh fruits and vegetables can be individually labeled by our fast and efficient produce labeling systems. We also provide an integrated equipment and aftermarket service program, including the patented Bin Scrubber System, the Single Pass Dryer and Smart Dryer System, and additional ancillary produce processing technologies.

We are a global supplier of fully integrated industrial preservation systems that enable production of shelf stable foods in a wide variety of flexible, rigid,applications including automotive manufacturing, warehousing, and semi-rigid packages. These integratedmedical facilities.

AeroTech markets its solutions and services to domestic and international airport authorities, passenger airlines, airfreight and ground handling companies, defense forces and defense contractors. The product offerings of our AeroTech businesses include:

•Mobile Equipment. Our mobile air transportation equipment includes commercial and defense cargo loading, aircraft deicing, aircraft towing, and aircraft ground power and cooling systems.

•Fixed Equipment. We provide gate equipment for the processing of shelf-stable foodpassenger boarding.

•Airport Services. We also maintain and liquid products include a line of continuous hydrostatic sterilizers, our continuous rotary sterilizers, Steam Water Spray static and SuperAgi™ batch retorts, XL-series fillers, SeamTec™ and X-series closers, material handlingenhance airport equipment, systems, and LOG-TEC® thermal process controls. We are a recognized U.S. Department of Agriculture (USDA) and Food and Drug Administration (FDA) Food Process Authority and offer the largest selection of preservation products in the industry. We offer consulting services to help design food production processes in accordance with USDA and FDA's stringent requirements. Our automated batch retorts can handle an array of flexible and rigid packages such as plastic pouches, cartons, glass and cans. Our solutions also include specialized material handling systems to automate the handling and tracking of processed and unprocessed containers. Additionally, we offer modeling software as well as thermal processing controls that help our customers optimize and track their cooking processes to allow real time modifications in the case of process deviations.facilities.


In 2017, we acquired the Avure Technologies and PLF International businesses, adding capabilities in the high pressure processing space for a broad array of market segments, and powdered product filling and handling systems, respectively.

Liquid Foods solution offerings accounted for 34% of our total revenue in 2017.

Automated Systems.  We are a leading global supplier of robotic automated guided vehicle systems for material movement in manufacturing and warehouse facilities. We provide engineering services and simulations to evaluate the material handling requirements, standard and custom automated guided vehicle hardware and software, and stand-alone (JayBoT®) and fully-integrated system hardware and software for a scalable solution that can be applied individually or across the entire customer enterprise.

Aftermarket Products, Consumables, Parts, and Services.We provide aftermarket products, parts, and services for allour installed base of our integrated food processing systemsFoodTech and equipment. We provideAeroTech equipment, including retrofits and refurbishments to accommodate the changing operational requirements and we supplyof our own brand of food grade lubricants and cleaners designed specifically for our equipment. We supply packaging material components for our clip packaging customers in the form of metal clips and hanging loops.customers. We also provide continuous, proactive service to our customers including the fulfillment of preventative maintenance agreements, consulting services such as water treatment, corrosion monitoring control, food safetyProCare, and process auditing, and the expertise of on-site technical personnel. In addition to helping our customers reduce their operating costs and improve efficiencies, our customer service focus also helps us maintain strong commercial relationships and provides us with ongoing access to information about our customers’ requirements and strategies to foster continuing product development. Our aftermarket products, parts, and services coupled with our large installed base of food processing systems and equipment, provide us with a strong base for growing recurring revenue. Sales of aftermarket products, parts and services are consolidated within the total revenue of their related JBT FoodTech businesses.consulting services. As part of our aftermarket program, we also offer technology for enterprise asset management and real-time operations monitoring with iOPS™. In 2022, we launched our patented iOPS™ suite.

JBT AeroTech

JBT AeroTech supplies customized solutionsnew digital solution called OmniBlu™, a subscription-based offering including best-in-class service, parts availability, and services used for applications in the air transportation industry, including airport authorities, airlines, airfreight, ground handling companies, the military and defense contractors. We believe our strong market positions result from our ability to customize our equipment and services utilizing differentiated technology to meet the specific needs of our customers. We continually strive to improve our existing technologies and develop new technologies by working closely with our well established customer base.
There is a significant installed base of our airport and airline equipment around the world. We are a leading supplier of cargo loaders, passenger boarding bridges, and aircraft deicers. We have also sold a significant number of mobile passenger steps, cargo transporters, and tow tractors that are operating at airports around the world. This installed base provides a stream of recurring revenue from aftermarket parts, products, and services. Recurring revenue accounted for 36% of AeroTech total revenue in 2017. Our installed base also offers continuous access to customer feedback for improvements and new product development.

JBT AeroTech products have been delivered to more than 100 countries. To support this equipment, we have operations located throughout the world. Our principal production facilities are located in the United States (Florida and Utah), China, Mexico, the United Kingdom and Spain. We also have sales and service offices located in nine countries and collaborative relationships with independent sales representatives, distributors, and service providers in over thirty additional countries.

Solutions, Products, and Services

We offer a broad portfolio of systems, equipment, and services to airport authorities, airlines, air cargo handlers, ground handling companies, military customers and defense contractors.
Mobile Equipment. We supply air cargo loaders, aircraft deicers, mobile power and environmental air conditioning systems, and other mobile ground support equipment to commercial air passenger and freight carriers, ground handlers, military customers and defense contractors.

Our Commander™ and Ranger™ loaders service containerized narrow-body and wide-body jet aircraft and are available in a wide range of configurations. Our Tempest™ aircraft deicers offer a broad range of options that can be configured to meet customers’ specific and regional need to provide efficient aircraft deicing while on the tarmac. We manufacture and supply a full array of B-series conventional aircraft tow tractors for moving aircraft without consumption of jet fuel, mobile passenger steps for tarmac boarding and deplaning, belt loaders, and self-propelled transporters for pallet and container handling.
Airlines and ground handling companies face increased pressure to reduce emissions and minimize fuel usage. We have a long history of delivering alternative fuel ground support equipment that provides a solution to these environmental and operational challenges. Our alternative fuel design approach is to provide modular ground support equipment, capable of being poweredmachine optimization capabilities - all supported by a variety of power sources. Our electric powered product offering includes Commander cargo loaders, cargo transporters, conventional aircraft pushback tractors, belt loaders,powerful digital backbone leveraging AI, machine learning, and passenger boarding steps. We also offer electric retrofit kits for our existing delivered base of diesel powered Commander cargo loaders.predictive analytics.

We manufacture a variety of sizes and configurations of auxiliary equipment including 400 Hertz ground power and preconditioned air units that supply aircraft requirements for electrical power and cooled air circulation for the environmental control system (air-conditioning) and main engine starting during ground operations.

Within mobile equipment, we also have a portfolio of military equipment, including a wide range of cargo loaders, ground power air conditioning, aircraft air compressors, air start, and bleed air units for the U.S. Air Force, the U.S. Navy, international military forces, airframe manufacturers and defense contractors. Mobile equipment technology offerings accounted for 12% of our total revenue in 2017. 

In 2017, we acquired Aircraft Maintenance Support Services, Ltd. (AMSS), a manufacturer of military and commercial aviation equipment that enhances our offerings and expands our access to foreign customers with our existing products.

Fixed Equipment. We supply airport gate equipment. Our Jetway® passenger boarding bridges have set the standard for airlines and airport authorities to move passengers between the terminal building and the aircraft since 1959. Our passenger boarding bridges support a range of aircraft types, from regional aircraft up to the Airbus A380. Within fixed equipment, we also supply point-of-use and mobile 400 Hertz and pre-conditioned air units that enable our customers to reduce fuel consumption and emissions by minimizing requirements to use auxiliary power units or aircraft engines while parked at the gate, as well as remote gate monitoring equipment to improve equipment availability and reduce turn times. We also offer aircraft in-ground service pits to provide utility access on airport ramps, hangars and remote parking areas. Fixed equipment accounted for 10% of our total revenue in 2017. 

Airport Services. We are an industry provider for the design and management of technical support programs supplied to airlines and airports at over 20 major locations most of which are in the continental United States. Our specialty services extend to expertise in the development of sustainable and value orientated operation, maintenance, and repair of sophisticated in-line baggage handling systems, gate equipment, facilities, and ground support equipment.

Aftermarket Products, Parts, and Services. We provide aftermarket products, parts, and services for our installed base of JBT AeroTech equipment. We also provide retrofits to accommodate changing operational requirements and continuous, proactive service, including, in some cases, on-site technical personnel. These systems and other services represent an integrated approach to addressing critical problems faced by our customers and ensure that we remain well positioned to respond to their new

requirements and strategic initiatives through our strong customer relations. Sales of aftermarket products, parts and services are consolidated within the total revenue of their associated JBT AeroTech businesses.

In support of our focus and strategy of meeting our customers’ needs, we have developed a global parts service network to enable us to market with confidence our ability to “provide the right part in the right place.” Our highly experienced global parts representatives help reduce equipment downtime by providing fast, accurate responses to technical questions. We also provide worldwide operations and maintenance training programs to provide maintenance technicians with the tools necessary to deliver the highest possible level of systems reliability.

OTHER BUSINESS INFORMATION RELEVANT TO ALL OF OUR BUSINESS SEGMENTS

Order Backlog
For information regarding order backlog, refer to the section entitled “Inbound Orders and Order Backlog” in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations of this Annual Report on Form 10-K.

Sources and Availability of Raw Materials
All of our business segments purchase carbon steel, stainless steel, aluminum, and/or steel castings and forgings both domestically and internationally. We do not use single source suppliers for the majority of our raw material purchases and believe the available supplies of raw materials are adequate to meet our needs.

Research and Development
The objectives of our research and development programs are to create new products and business opportunities in relevant fields, and to improve existing products.

For additional financial information about our research and development activities, refer to Note 1. Summary of Significant Accounting Policies and Note 16. Business Segments to our Consolidated Financial Statements included in Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K.


Sales and Marketing
We sell and market our products and services predominantly through a direct sales force, supplemented with independent distributors, sales representatives, and sales representatives.technical service teams. Our experienced internationalglobal sales force is comprised of individuals with strong technical expertise in our products and services and the industries in which they are sold.


5

We support our sales force with marketing and training programs that are designed to increase awareness of our product offerings and highlight our differentiation while providing a set of sales tools to aid in the sales of our technology solutions. We actively employ a broad range of marketing programs to inform and educate customers, the media, industry analysts, and academia through targeted newsletters, our web site,web-site, seminars, trade shows, user groups, and conferences. We regularly introduce new internal digital resources designed to accelerate the quote-to-order process, identify cross-selling opportunities between our separate businesses. In addition, we utilize marketing automation processes and technology to drive lead generation.

Patents, Trademarks and Other Intellectual Property
We own a number of United States and foreign patents, trademarks, and licenses that are cumulatively important to our business. We own approximately 725 United States and foreign issued patents and have approximately 240 patent applications pending in the United States and abroad. Further, we license certain intellectual property rights to or from third parties. We also own numerous United States and foreign trademarks and trade names and have approximately 820 registrations and pending applications in the United States and abroad. Developing and maintaining a strong intellectual property portfolio is an important component of our strategy to extend our technology leadership. However, we do not believe that the loss of any one or group of related patents, trademarks, or licenses would have a material adverse effect on our overall business.


Competition
We conduct business worldwide and compete with large multinational companies as well as a variety of local and regional companies, which typically are focused on a specific application, technology or geographical area.


We compete by leveraging our industry expertise to provide differentiated and proprietary technology, integrated systems, high product quality and reliability, and comprehensive aftermarket service. We strive to provide our customers with equipment that delivers a lower total cost of ownership, distinguishing ourselves by providing excellent equipmentreliable uptime, andlabor reduction through automation, increased yields, and improved product quality, while helping customers achieve ambitious environmental goals of lowering energy and water usage, reducing food waste, and enhancing food safety. Our ability to provide comprehensive sales and service in all major regions of the world, by maintaining local personnel in region, differentiates us from regional competition.

Our historically strong position in the markets we serve has provided us with improved finala large installed base of systems and equipment. The installed base of our equipment is a source of recurring revenue from aftermarket products, parts, services, and lease arrangements. Recurring revenue accounted for 47% of our FoodTech total revenue and 38% of our AeroTech total revenue in 2022. The installed base also provides us with strong, long-term customer relationships from which we derive information for new product quality.development to meet the evolving needs of our customers.


JBT FoodTech’s major competitors include Advanced Equipment Inc.; Alit SRL;Allpax Products, Inc.; Atlas Pacific Engineering Company, Inc.; Barry-Wehmiller Companies, Inc.; Brown International Corp.; CFT S.p.A.; Egemin Automation Inc.; Elettric 80 S.p.a. Italia; Ferrum; Food Processing Equipment Company; FPS Process Foods Solutions; GEA Group AG; Marel hf.;

METALQUIMIA, S.A.; Mettler-Toledo International, Inc.; Morris & Associates, Inc.; MYCOM; Middleby Corporation; Nantong Freezing Equipment Company, Ltd.; Poly-clip system GmbH & Co. KG; Provisur Technologies, Inc.; Scanico A/S; Shibuya Corporation; Starfrost; Statco Engineering; Steriflow SAS.; Tetra Laval; and Tecnopool S.p.A.

JBT AeroTech’s major competitors include Cavotec SA; Elite Line Services Inc.; ERMC; Global Ground Support LLC; Goldhofer AG; Illinois Tool Works Inc.; Mallaghan Engineering Ltd; Shenzhen CIMC - Tianda Airport Support CO. LTD.; ThyssenKrupp AG; TLD Group SAS; Trepel Airport Equipment GmbH; Textron Inc.; TwistAero; Vanderlande Industries B.V.; Vestergaard Company A/S; and Weihai Guangtai Airport Equipment Co., LTD.

EmployeesGeographic Information
We have approximately 5,800 employees with approximately 3,600operations strategically positioned around the world to serve the existing FoodTech and AeroTech equipment base located in the United States. Approximately 7%more than 100 countries. See Item 1A. Risk Factors for a discussion of risks associated with our employees in the United States are represented by two collective bargaining agreements.global operations.

Outside the United States, we enter into employment contracts and agreements in those countries in which such relationships are mandatory or customary. The provisions of these agreements correspond in each case with the required or customary terms in the subject jurisdiction. Approximately 62% of our international employees are covered under national employee unions.

We maintain good employee relations and have successfully concluded all of our recent negotiations without a work stoppage. However, we cannot predict the outcome of future contract negotiations.


Customers
No single customer accounted for more than 10% of our total revenue in any of the last three fiscal years.


Government Contracts
We supplyAeroTech supplies equipment and logistics support to the U.S. Department of Defense, municipalities, and international forces.governments. The amount of equipment and parts supplied to these programs is dependent upon annual government appropriations and levels of militarydefense spending. In addition, United States defense contracts are unilaterally terminable at the option of the United States government with compensation for work completed and costs incurred. Contracts with the United States government and defense contractors are subject to special laws and regulations, the noncompliance with which may result in various sanctions that could materially affect our ongoing government business.


Patents, Trademarks and Other Intellectual Property
We own a number of United States and foreign patents, trademarks, and licenses that are cumulatively important to our business. We own approximately 702 United States and foreign issued patents and have approximately 343 patent applications pending in the United States and abroad. Further, we license certain intellectual property rights to or from third parties. We also own numerous United States and foreign trademarks and trade names and have approximately 969 registrations and pending applications in the United States and abroad. A substantial majority of these patents, trademarks and trade names are associated with the FoodTech segment. Developing and maintaining a strong intellectual property portfolio is an important component of our strategy to extend our technology leadership. However, we do not believe that the loss of any one or group of related patents, trademarks, or licenses would have a material adverse effect on our overall business.

Sources and Availability of Raw Materials
All of our business segments purchase carbon steel, stainless steel, aluminum, and/or steel castings and forgings both domestically and internationally. We do not use single source suppliers for the majority of our raw material purchases and believe the available supplies of raw materials are adequate to meet our needs. However, the disruptions to the global economy which began in 2020 and continued throughout the years 2021 and 2022 have impeded global supply chains, resulting in longer lead times and increased raw material costs. We have taken steps to minimize the impact of these increased costs by working closely with our supply base, primarily through supply chain and strategic sourcing initiatives that include supply base consolidation, make versus buy decisions, value engineering and component standardization, and best cost country sourcing. We expect supply chain disruptions to continue into 2023, the effect of which will depend in part on our ability to successfully mitigate and offset the impact of these events.

6

Working Capital Practices
In order to provide, and install, custom designed equipment, companies in the food machinery industry generally generate customer deposits, or advance payments, before construction begins. For this reason, FoodTech can be less working capital intensive than many other industrial capital goods industries. AeroTech solutions do not generate a significant amount of advance payment from the air transportation industry, and therefore operations in this segment is generally more capital intensive.

Human Capital Management
We have employees located throughout the world. As of fiscal year end 2022, we have approximately 7,200 employees worldwide, with approximately 56% located in the United States. Approximately 8% of our employees in the United States are represented by three collective bargaining agreements, and less than 2% of employees in the United States are represented by agreements that will expire within two years. Outside the United States, we enter into employment contracts and agreements in those countries in which such relationships are mandatory or customary. The provisions of these agreements correspond in each case with the required or customary terms in the subject jurisdiction. Approximately 49% of our international employees are covered by global employee representation bodies. We have historically maintained good employee relations and have successfully concluded all of our recent negotiations without a work stoppage. However, we cannot predict the outcome of future contract negotiations.

Our strong employee base, along with their commitment to our uncompromising values of integrity, accountability, continuous improvement, teamwork, and customer focus, provide the foundation of our company’s success. Employee safety, and managing the risks associated with our workplace, is of paramount importance to JBT. We give employees the training and tools to manage risk. We also empower employees to stop work if they encounter an unsafe situation. JBT's Health and Safety program operates under management's belief that all injuries can be prevented, with a company objective of "Zero Incidents, Worldwide, Every Day.” Specifically, we have deployed a global Near Miss and Behavior-Based Safety Observations reporting program, under which potential unsafe conditions or behaviors are proactively reported and corrected before they cause an injury. JBT's foundational commitment to safety is demonstrated by our world-class recordable and loss-time rates below. This safety information is provided in the CEO report to the Board of Directors at every Board meeting.

jbt-20221231_g1.gif


JBT embraces diversity, equity, inclusion, and belonging ("DEIB"), and we believe a diverse workforce fosters innovation and cultivates an environment filled with unique perspectives. We are committed to creating an inclusive culture where employees can bring their whole selves to work and we strive to use our resources to support causes that help to create a respectful and accepting global community. As part of JBT’s commitment to DEIB, our global DEIB Council, which partners with our executive management team to develop and deploy programs, processes and communications to further our DEIB objectives. JBT has formed employee network communities (ENCs) to create a safe space for underrepresented groups to build community, share experiences, foster professional development and uphold our culture of inclusion. We are also focused on recruitment of diverse candidates as well as on internal talent development of our diverse leaders so that they can advance their careers and move into leadership positions within the company. The JBT Tom Giacomini Engineering Scholarship Program provides twelve annual individual scholarships to minority students pursuing an engineering degree that are currently members of one of three national organizations: the Society of Women Engineers (SWE), the Society of Hispanic Professional Engineers (SHPE), and the National Society of Black Engineers (NSBE).

7

We invest in programs and processes that develop our employees' capabilities to ensure that we have the talent we need to execute our strategic business plans. Our executive Performance Management Program ensures that all leaders have clear priorities, and that their performance relative to these priorities are linked to their total rewards package. Our global Talent Development Review process starts at a local level and ultimately rolls up to divisional leadership and the executive leadership team to identify talent development needs, mitigate talent risks and plan for succession. These talent plans are presented to the Compensation Committee of the Board of Directors each year. The result is a specific and actionable talent plan in every business that measures the health of our leadership pipeline and ensures the execution of the important priorities set for each business. Our Leader Excellence Program provides an overview of the 13 competencies that have been identified in successful JBT leaders and deploys a formal framework through which these traits can be assessed and developed more broadly in our workforce. This ensures a fair, accurate and consistent approach in the development and assessment of leaders and potential leaders.

We believe our management team has the experience necessary to effectively execute our strategy. Our CEO and segment leaders have significant industry experience and are supported by experienced and talented management teams who are dedicated to maintaining and expanding our position as a global leader in our markets. For discussion of the risks relating to the attraction and retention of management and executive management employees, see “Part 1. Item 1A. Risk Factors.”

Governmental Regulation and Environmental Matters
Our operations are subject to various federal, state, local, and foreign laws and regulations governing the prevention of pollution and the protection of environmental quality. If we fail to comply with these environmental laws and regulations, administrative, civil, and criminal penalties may be imposed, and we may become subject to regulatory enforcement actions in the form of injunctions and cease and desist orders. We may also be subject to civil claims arising out of an accident or other event causing environmental pollution. These laws and regulations may expose us to liability for the conduct of or conditions caused by others or for our own acts even though these actions were in compliance with all applicable laws at the time they were performed.


Under the Comprehensive Environmental Response, Compensation and Liability Act, referred to as CERCLA, and related state laws and regulations, joint and several liability can be imposed without regard to fault or the legality of the original conduct on certain classes of persons that contributed to the release of a hazardous substance into the environment. These persons include the owner and operator of a contaminated site where a hazardous substance release occurred and any company that transported, disposed of, or arranged for the transport or disposal of hazardous substances that have been released into the environment, including hazardous substances generated by any closed operations or facilities. In addition, neighboring landowners or other third parties may file claims for personal injury, property damage, and recovery of response cost. We may also be subject to the corrective action provisions of the Resource, Conservation and Recovery Act, or RCRA, and analogous state laws that require owners and operators of facilities that treat, store, or dispose of hazardous waste to clean up releases of hazardous waste constituents into the environment associated with their operations.


Many of our facilities and operations are also governed by laws and regulations relating to worker health and workplace safety, including the Federal Occupational Safety and Health Act, or OSHA. We believe that appropriate precautions are taken to protect our employees and others from harmful exposure to potentially hazardous materials handled and managed at our facilities,work environments, and that we operate in substantial compliance with all OSHA or similar regulations.


We are also subject to laws and regulations related to conflict minerals, forced labor, export compliance, local hiringanti-corruption, and anti-corruption,immigration and we have adopted policies, procedures and employee training programs that are designed to facilitate compliance with those laws and regulations.


Financial Information about Geographic Areas
A significant portion of our consolidated revenue is generated in markets outside of the United States. For financial information about geographic areas see Note 16. Business Segments of our Consolidated Financial Statements in Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K.


Available Information
All periodic and current reports, registration statements, and other filings that we are required to make with the Securities and Exchange Commission (SEC), including annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, proxy statements and other information are available free of charge through our website as soon as reasonably practicable after we file them with, or furnish them to, the SEC. You may access and read our SEC filings free of charge through our website at www.jbtc.com, under “Investor Relations – SEC Filings,” or the SEC’s website at www.sec.gov. These reports are also available to read and copy at the SEC’s Public Reference Room by contacting the SEC at 1-800-SEC-0330.


The information contained on or connected to our website, www.jbtc.com, is not incorporated by reference into this Annual Report on Form 10-K or any other report we file with the SEC.


8

INFORMATION ABOUT OUR EXECUTIVE OFFICERS OF THE REGISTRANT


The executive officers of JBT Corporation, together with the offices currently held by them, their business experience and their ages as of February 19, 2018,16, 2023, are as follows:

NameAgeOffice
Thomas W. GiacominiBrian A. Deck5254Chairman, President and Chief Executive Officer
Brian A. DeckMatthew J. Meister4944Executive Vice President and Chief Financial Officer
Paul SternliebShelley Bridarolli4552Executive Vice President, and President, ProteinChief Human Resources Officer
Carlos Fernandez48Executive Vice President and President, Liquid Foods
David C. Burdakin62Executive Vice President and President, JBT AeroTech
Steven R. Smith57Executive Vice President
James L. Marvin5762Executive Vice President, General Counsel and Assistant Secretary
Jason T. ClaytonKristina Paschall4148Executive Vice President, Human ResourcesChief Information and Digital Officer
Debarshi SenguptaJack Martin4159Executive Vice President, Business DevelopmentSupply Chain
Megan J. RattiganDavid C. Burdakin4967Executive Vice President and President, AeroTech
Luiz "Augusto" Rizzolo44Executive Vice President and President, Diversified Food and Health
Robert Petrie53Executive Vice President and President, Protein
Jessi L. Corcoran40Vice President, Corporate Controller and Chief Accounting Officer


THOMAS W. GIACOMINIBRIAN A. DECK became theour President and Chief Executive Officer of JBT Corporationin December 2020 after serving as well as a member of the JBT Board of Directors in September 2013. In May 2014, Mr. Giacomini was elected Chairman of the Board. Prior to joining JBT, he served as Vice President (since February 2008) of Dover Corporation, a diversified global manufacturer, and President andinterim Chief Executive Officer (since November 2011) of Dover Engineered Systems. Priorfrom June 2020 to serving in these roles,December 2020. Mr. GiacominiDeck served as President (from April 2009 to November 2011) and Chief Executive Officer (from July 2009 to November 2011) of Dover Industrial Products and President (from October 2007 to July 2009) of Dover's Material Handling Platform. Mr. Giacomini joined Dover in 2003 following its acquisition of Warn Industries, an industrial manufacturer specializing in vehicle performance enhancing equipment. During his 12 year tenure at Warn Industries he held a variety of leadership roles including President and Chief Operating Officer. Prior to joining Warn Industries, Mr. Giacomini held various positions at TRW, Inc. Since June 2017, Mr. Giacomini has served as a director of MSA Safety Incorporated, a global safety equipment manufacturer.

BRIAN A. DECK became theour Vice President and Chief Financial Officer of JBT Corporation infrom February 2014. In May 2014 Mr. Deck’s title changed to Executive Vice President and Chief Financial Officer, and he was appointed Treasurer. Inuntil December 2014, Mr. Deck appointed a Treasurer and resigned from that position.2020. Prior to joining JBT, he served as Chief Financial Officer (since May 2011) of National Material L.P., a private diversified industrial holding company. Mr. Deck served as Vice President of Finance and Treasury (from November(November 2007 to May 2011) and as Director, Corporate Financial Planning and Analysis (from August(August 2005 to November 2007) of Ryerson Inc., a metals distributor and processor. Prior to his service with Ryerson, Mr. Deck had increasing responsibilitiesheld various positions with General Electric Capital, Bank One (now JPMorgan Chase & Co.), and Cole Taylor Bank.


PAUL STERNLIEBMATTHEW J. MEISTER became our Chief Financial Officer in December 2020 after serving as the interim Chief Financial Officer since October 2020. Mr. Meister joined JBT in May 2019 as Vice President and CFO for JBT Protein, with responsibility for all accounting and finance activity for the Protein Division within the FoodTech segment. He joined the Company with extensive experience in global manufacturing across various industries including automotive, medical devices, and general industrial applications, including his prior roles at IDEX Corporation, where he held several finance leadership roles within the operations, ending with the Group Vice President, Health and Science Technologies role. Prior to joining IDEX in January 2013, he held various roles of increasing responsibility within the business units and in the corporate office at Navistar International Corporation.

SHELLEY BRIDAROLLI became our as Executive Vice President, and President, ProteinHuman Resources in October 2017. Prior to joining JBT, he was Group President, Global Cooking (since 2014) of Illinois Tool Works (ITW). Prior to ITW, he served as a Vice President and

General Manager (2011 to 2014) for Danaher.September 2021. Prior to that, he held management roles with H.J. Heinz Company andMs. Bridarolli was a consultant with McKinsey & Company leading consulting engagements for global food and beverage clients.

CARLOS FERNANDEZ became the ExecutiveSenior Vice President Human Resources of Dana Incorporated from November 2018 until April 2020. Before joining Dana Incorporated, she was the Vice President Human Resources for the PowerDrive Systems Division of BorgWarner, Inc. from August 2014 to November 2018, and President, Liquid Foods in August 2017. Previously, Mr. Fernandezalso served as a Vice President of JBT (since 2014) and President, Liquid Foods (since 2016). He joined FMC Corporation in 1996 as a Financial Analyst in Madrid, Spain. Since then Mr. Fernandez served in a variety of finance and general manager roles with FMC Corporation and FMC Technologies, Inc., JBT’s previous parent company, as well as with JBT FoodTech, including serving as the General Manager of Fruit and Juice SolutionsBorg Warner’s Interim Chief Human Resources Officer from 2012July to 2014.

DAVID C. BURDAKIN became the Executive Vice President and President, JBT AeroTech in May 2014. Previously, Mr. Burdakin was Vice President and Division Manager-JBT AeroTech beginning in January 2014. Prior to joining JBT, he worked as an independent consultant and as Non-Executive Chairman of Mayline Corporation, a private equity owned industrial company (2012 to 2013). Prior to Mayline, he served as President and Chief Executive Officer (2007 to 2012) of Paladin Brands, a leading independent manufacturer of attachment tools for construction equipment including mobile aviation support equipment.November 2018. Prior to that, Mr. Burdakin progressed through variousMs. Bridarolli held progressive senior HR leadership roles at HNIEaton Corporation (1993 to 2007), including seven years as President of The HONbetween May 2001 and August 2014. Ms. Bridarolli began her professional career in 1998 with National Fuel Exploration Company HNI's largest operating company. Prior to joining HNI, he held various positions at Illinois Tool Works Inc. and Bendix Industrial Group.in Calgary, Canada.

STEVEN R. SMITH became the Vice President and Division Manager-JBT FoodTech in December 2013. In May 2014, Mr. Smith’s title changed to Executive Vice President and Division President- JBT FoodTech. It was announced in August 2017 that Mr. Smith's title would change to Executive Vice President, and would plan to retire in the 2nd quarter of 2018. Previously Mr. Smith served as our Vice President and Division Manager-Food Processing Systems (since October 2011). Mr. Smith joined FMC Corporation in 1989 as a Business Planner with FMC's Petroleum Equipment Group in Houston, Texas. Since then, he has served in a variety of sales, marketing, and line management roles within FMC Corporation and FMC Technologies, Inc., JBT's previous parent companies, as well as with JBT FoodTech, including most recently serving as the General Manager for the America's Operations of FoodTech's Food Solutions and Services Division from 2003 to 2011.


JAMES L. MARVIN became our Executive Vice President and General Counsel in May 2014, and served as Secretary from July 2008 to August 2018, subsequent to which he has served as Secretary since July 2008.Assistant Secretary. From July 2008 until May 2014, Mr. Marvin served as Deputy General Counsel and Secretary, acting as Division Counsel for JBT AeroTech and managing corporate legal matters. Mr. Marvin joined FMC Technologies, Inc. in April 2003, serving as Assistant General Counsel and Assistant Secretary, acting as Division Counsel for FMC Technologies’ Airport Systems Division and managing corporate legal matters. Before joining FMC Technologies in 2003, Mr. Marvin served in the roles of Chief Corporate Counsel and Division Counsel for Corporate Finance at Heller Financial, Inc., a publicly-traded middle-market financial services business. Mr. Marvin was previously a partner with the Chicago-based law firm Katten Muchin Zavis, with a practice focused in commercial financial transactions. Mr. Marvin was a corporate securities attorney with O’Connor Cavanagh Anderson Westover Killingsworth & Beshears in Phoenix, Arizona.


JASON T. CLAYTONKRISTINA PASCHALL became our Executive Vice President, Human ResourcesChief Information and Digital Officer in October 2020. She was appointed Vice President and Chief Information Officer of JBT Corporation in September 2016.2017. Prior to joining us,JBT Corporation, Ms. Paschall was the Chief Information Officer of Ferrara Candy Company (2013 – 2017). Before joining Ferrara, she held progressive senior IT leadership roles at Ingredion and GATX, having spent the previous part of her career in management roles at consulting organizations.

9

JACK MARTIN became the Executive Vice President, Supply Chain in April 2022. Prior to joining JBT, Mr. ClaytonMartin was employed by Marmon Holdings as Vice President, Supply Chain from August 2019 to April 2022. Before joining Marmon Holdings, he provided full time supply chain consulting services to Standex International and International Equipment Solutions in 2018 and 2019. Mr. Martin served in several group leadership roles with Dover Corporation from 2008 to 2017 with his last role being Vice President, Global Sourcing. Mr. Martin started and advanced his career in progressive purchasing and supply chain roles for companies like John Crane International, SKF / Chicago Rawhide, and Thermo Fisher Scientific.

DAVID C. BURDAKIN became the Executive Vice President and President, AeroTech in May 2014. Previously, Mr. Burdakin was Vice President and Division Manager-AeroTech beginning in January 2014. Prior to joining JBT, he worked as an independent consultant and as Non-Executive Chairman of Mayline Corporation, a private equity owned industrial company (2012 – 2013). Prior to Mayline, he served as President and Chief Executive Officer (2007 – 2012) of Paladin Brands, a leading independent manufacturer of attachment tools for construction equipment including mobile aviation support equipment. Prior to that, Mr. Burdakin progressed through various leadership roles at HNI Corporation (1993 – 2007), including seven years as President of The HON Company, HNI's largest operating company. Prior to joining HNI, he held various positions at Illinois Tool Works Inc. and Bendix Industrial Group.

LUIZ “AUGUSTO” RIZZOLO became the Executive Vice President and President, Diversified Food and Health in October 2022.Previously, Mr. Rizzolo served as a President, Protein North America (since 2020) and as the Vice President, Human Resources for Signode Industrial Group LLC., From 2010 to 2015, Mr. Clayton worked in various Human Resources roles with IDEX Corporation, most recently as Vice President, Human Resources. Mr. Clayton worked for Pepsi Beverages Company/Pepsico from 2004 to 2010 in various positions, most recently as Director, Human Resources, Chicagoland/Wisconsin Market Unit. Mr. Clayton worked for Newell Rubbermaid from 2001 to 2004, where he served in various positions, most recently as Human ResourcesGeneral Manager Sanfordof Protein North America Division.Customer Care (2019 – 2020). Prior to joining JBT, Mr. ClaytonRizzolo was the Group President, Specialty Retail Business at Marmon Holdings, Inc. (2018 – 2019). Prior to that, he worked for Burlington Industries, Inc. from 2000 to 2001.at Illinois Tool Works (2014 – 2018) as VP/GM at various times of each of the Global Weight & Wrap Division and the North America Service Division, and at Whirlpool Corporation (2003 – 2014) in positions of increasing responsibility.


DEBARSHI SENGUPTAROBERT PETRIE was namedappointed as our Executive Vice President Corporate Developmentand President, Protein in March 2016.September 2021. Mr. Sengupta assumed our Corporate Development portfolioPetrie previously led JBT's Protein EMEA (Europe, Middle East, and Africa) business, with additional responsibility for JBT's Protein business in 2014 asAsia. Mr. Petrie joined the Company in 2009 when Double D Food Engineering Ltd, where he was Managing Director and a shareholder, was acquired by JBT. During his tenure at JBT, Mr. Petrie has progressed through several general management and commercial leadership roles with increasingly complex responsibilities.Before joining Double D, Mr. Petrie held various engineering, quality, and operational positions at NCR Corporation.

JESSI L. CORCORAN became Vice President, Corporate DevelopmentController and Investor Relations. From 2011 to 2014, Mr. Sengupta led Investor Relations and Financial Planning and Analysis. Mr. Sengupta joined us in 2009 as a Business Planner. From 2007 to 2009, Mr. Sengupta worked as a consumer & retail investment banker at Banc of America Securities.

MEGAN J. RATTIGAN became a Vice President in August 2014 and has served as our Controller since December 2013. Previously, Ms. Rattigan served as our Chief Accounting Officer (since November 2008) and Director of Financial Control (since July 2008).in October 2020. Ms. Rattigan was FMC Technologies’Corcoran came to JBT in 2015 as Senior Manager of FinancialExternal Reporting and Technical Accounting. She was promoted to Assistant Corporate Controller in 2017 and Chief Accounting Research from April 2005 until July 2008.Officer in 2018. Prior to that, Ms. Rattigan served as a consultant to FMC Technologies from January 2002 until April 2005. From July 1998 until December 2001, Ms. Rattigan was Director of Finance for Chart House Enterprises, Inc. Ms. Rattigan is a certified public accountant and began her professional careerJBT she worked in the Audit & Assurance practice at Deloitte for nine years, with increasing levels of Ernst & Young LLP in 1992.responsibility through senior manager.

10

ITEM 1A.    RISK FACTORS


You should carefully consider the risks described below, together with all of the other information included in this Annual Report on Form 10-K, in evaluating our company and our common stock. If any of the risks described below actually occurs, our business, financial condition, results of operations, cash flows and stock price could be materially adversely affected.


BUSINESS AND OPERATIONAL RISKS

Our financial results are subject to fluctuations caused by many factors that could result in our failing to achieve anticipated financial results and cause a drop in our stock price.


Our quarterly and annual financial results have varied in the past and are likely to continue to vary in the future due to a number of factors, many of which are beyond our control. In particular, the contractual terms and the number and size of orders in the capital goods industries in which we compete vary significantly over time. The timing of our sales cycle from receipt of orders to shipment of the products or provision of services can significantly impact our sales and income in any given fiscal period. These and any one or more of the factors listed below, among other things, could cause us not to achieve our revenue or profitability expectations in any given period and the resulting failure to meet such expectations could cause a drop in our stock price:


•volatility in demand for our products and services, including volatility in growth rates in the food processing and air transportation industries;


•downturns in our customers’ businesses resulting from deteriorating domestic and international economies where our customers conduct substantial business;


•increases in commodity prices resulting in increased manufacturing costs, such as petroleum-based products, metals or other raw materials we use in significant quantities;


•supply chain delays and interruptions;


•effects of tight labor market on our labor costs resulting from higher labor turnover, shortage of skilled labor, and higher labor absenteeism, also in part due to effects of the COVID-19 pandemic;

•changes in pricing policies resulting from competitive pressures, including aggressive price discounting by our competitors and other market factors;


•our ability to develop and introduce on a timely basis new or enhanced versions of our products and services;


•unexpected needs for capital expenditures or other unanticipated expenses;


•changes in the mix of revenue attributable to domestic and international sales;


•changes in the mix of products and services that we sell;


•changes in foreign currency rates;


•seasonal fluctuations in buying patterns; and


•future acquisitions and divestitures of technologies, products, and businesses.businesses;


Variability in the length of our sales cycles makes accurate estimation of our revenue in any single period difficult and can result in significant fluctuation in quarterly operating results.

The length of our sales cycle varies depending on a number of factors over which we may have little or no control, including the size and complexity of a potential transaction, the level of competition that we encounter during our selling process, and our current and potential customers’ internal budgeting and approval process. Many of our sales are subject to an extended sales cycle. As a result, we may expend significant effort and resources over a significant period of time in an attempt to obtain an order, but ultimately not obtain the order, or obtain an order that is smaller than we anticipated. Revenue generated by any one of our customers may vary from quarter to quarter, and a customer who places a large order in one quarter may generate significantly lower revenue in subsequent quarters. Due to the length and uncertainty of our sales cycle, and the variability of orders from period to period, we believe that quarter-to-quarter comparisons of our revenue and operating results may not be an accurate indicator of our short term or future performance.

We face risks associated with current and future acquisitions.

To achieve our strategic objectives, we have pursued and expect to continue to pursue expansion opportunities such as acquiring other businesses or assets. Expanding through acquisitions involves risks such as:
the incurrence of additional debt to finance the acquisition or expansion;

additional liabilities (whether known or unknown), including environmental or pension liabilities of the acquired business or assets;

risks and costs associated with integrating the acquired business or new facility into our operations;

the need to retain and assimilate key employees of the acquired business or assets;

unanticipated demands on our management, operational resources and financial and internal control systems;

unanticipated regulatory risks;

the risk of being denied the necessary licenses, permits and approvals from state, local and foreign governments, and the costs and time associated with obtaining such licenses, permits and approvals;

risks that we do not achieve anticipated operating efficiencies, synergies and economies of scale; and

risks in retaining the existing customers and contracts of the acquired business or assets.

If we are unable to effectively integrate acquired businesses or newly formed operations, or if such acquired businesses underperform relative to our expectations, such an expansion may have a material adverse effect on our business, financial position, and results of operations.

Deterioration of economic conditions could adversely impact our business.

Our business may be adversely affected by •changes in current or future national or global economic conditions, including lower growth rates or recession, high unemployment, rising interest rates, limited availability of capital, decreases in consumer spending rates, the availability and cost of energy, and the effect of government deficit reduction, sequestration, and other austerity measures impacting the markets we serve. Any such changes could adversely affect the demand for our products or the cost and availability of our required raw materials, which can have a material adverse effect on our financial results. Adverse national and global economic conditions could, among other things:

make it more difficult or costly for us to obtain necessary financing for our operations, our investments and our acquisitions, or to refinance our debt;

cause our lenders or other financial instrument counterparties to be unable to honor their commitments or otherwise default under our financing arrangements;

impair the financial condition of some of our customers, thereby hindering our customers’ ability to obtain financing to purchase our products and/or increasing customer bad debts;

cause customers to forgo or postpone new purchases in favor of repairing existing equipment and machinery, and delay or reduce preventative maintenance, thereby reducing our revenue and/or profits;

negatively impact our customers’ ability to raise pricing to counteract increased fuel, labor, and other costs, making it less likely that they will expend the same capital and other resources on our equipment as they have in the past;

impair the financial condition of some of our suppliers thereby potentially increasing both the likelihood of our having to renegotiate supply terms on terms that may not be as favorable to us and the risk of non-performance by suppliers;

negatively impact global demand for air transportation services as well as the food preparation industry, which could result in a reduction of sales, operating income, and cash flows in our JBT AeroTech and JBT FoodTech segments;


negatively affect the rates of expansion, consolidation, renovation, and equipment replacement within the air transportation industry and within the food processing industry, which may adversely affect the results of operations of our JBT AeroTech and JBT FoodTech segments; and

impair the financial viability of our insurers.

Disruptions in the political, regulatory, economic and social conditions of the foreign countries in which we conduct business could negatively affect our business, financial condition, and results of operations.

We operate manufacturing facilities in eleven countries other than the United States, the largest of which are located in Belgium, China, Sweden, Brazil, Italy, Spain, United Kingdom, the Netherlands and Germany. Our international sales accounted for 40% of our 2017 revenue. Multiple factors relating to our international operations and to those particular countries in which we operate or seek to expand our operations could have an adverse effect on our financial condition or results of operations. These factors include, among others:

economic downturns, inflationary and recessionary markets, including in capital and equity markets;

civil unrest, political instability, terrorist attacks, and wars;

nationalization, expropriation, or seizure of assets;

potentially burdensome taxation in other jurisdictions;

changes in the mix of our international business operations and revenue relative to our domestic operations, resulting in increasing tax liabilities resulting from repatriation of income generated outside of the United States;

inability to repatriate income or capital;

foreign ownership restrictions;

export regulations that could erode profit margins or restrict exports, including import or export licensing regulations;

trade restrictions, trade protection measures, or price controls;

restrictions on operations, trade practices, trade partners, and investment decisions resulting from domestic and foreign laws and regulations;

compliance with the U.S. Foreign Corrupt Practices Act and other similar laws;

burden and cost of complying with foreign laws, treaties, and technical standards and changes in those regulations;

transportation delays and interruptions; and

reductions in the availability of qualified personnel.


Changes to trade regulation, quotas, duties or tariffs, caused by the changing U.S. and geopolitical environments or otherwise, may increaseenvironments; and

•cyber-attacks and other IT threats that could disable our costs or limit the amount of raw materialsIT infrastructure and products that we can import.create a meaningful inability to operate our business.

The current U.S. administration has voiced strong concerns about imports from countries that it perceives as engaging in unfair trade practices, and may decide to impose import dutiesloss of key personnel or other restrictions on products or raw materials sourced from those countries, which may include China and other countries from which we import raw materials or in which we manufacture our products. Any such duties or restrictions could have a material adverse effect on our business, results of operations or financial condition. 

The result of the Referendum of the United Kingdom’s Membership in the European Union have created uncertainties that could have negative effects on us.

The announcement of the Referendum of the United Kingdom’s (or the U.K.) Membership in the European Union (E.U.) (referred to as Brexit), advising for the exit of the United Kingdom from the European Union, has resulted in significant volatility in global stock markets and currency exchange rate fluctuations that resulted in the strengthening of the U.S. dollar against certain foreign currencies

in which we conduct business. As described in Item 7A. Quantitative and Qualitative Disclosures About Market Risk - Foreign Currency Exchange Rate Risk, we translate revenue denominated in foreign currency into U.S. dollars for our financial statements. During periods of a strengthening dollar, our reported international revenue is reduced because foreign currencies translate into fewer U.S. dollars.

The effects of Brexit will depend on any agreements the U.K. makes to retain access to E.U. markets either during a transitional period or more permanently. The measures could potentially disrupt the markets we serve and may cause us to lose customers and employees. In addition, Brexit could lead to legal uncertainty and potentially divergent national laws and regulations as the U.K. determines which E.U. laws to replace or replicate. These uncertainties may cause our customers to closely monitor their costs and reduce their spending budget on our products and services.

Any of these effects of Brexit, among others, could materially adversely affect our business, results of operations and financial condition.

Fluctuations in currency exchange rates could negatively affect our business, financial condition, and results of operations.

A significant portion of our revenue and expenses are realized in foreign currencies. As a result, changes in exchange rates will result in increases or decreases in our costs and earnings and may adversely affect our Consolidated Financial Statements, which are stated in U.S. dollars. Although we may seek to minimize currency exchange risk by engaging in hedging transactions where we deem appropriate, we cannot be assured that our efforts will be successful. Currency fluctuations may also result in our systems and services becoming more expensive and less competitive than those of other suppliers in the foreign countries in which we sell our systems and services.

We have invested substantial resources in certain markets where we expect growth, and our business may suffer if we are unable to achieve the growth we expect.
As part of our strategy to grow, we are expanding our operations in certain emerging or developing markets, and accordingly have made and expect to continue to make substantial investments to support anticipated growth in those regions. We may fail to realize expected rates of return on our existing investments or incur losses on such investments, and we may be unable to redeploy capital to take advantage of other markets. Our results will also suffer if these regions do not grow as quickly as we anticipate.

Our restructuring initiatives may not achieve the expected cost reductions or other anticipated benefits.

We regularly evaluate our existing operations, service capacity, and business efficiencies to determine if a realignment or restructuring could improve our results of operations or achieve some other business goal. Our realignment and restructuring initiatives are designed to result in more efficient and increasingly profitable operations. Our ability to achieve the anticipated cost savings and other benefits from these initiatives within the expected time frame is subject to many estimates and assumptions. These estimates and assumptions are subject to significant economic, competitive, and other uncertainties, some of which are beyond our control. In 2016, we implemented an optimization program to realign FoodTech’s Protein business in North America and Liquid Foods business in Europe, accelerate our strategic sourcing initiatives, and consolidate smaller facilities, and have incurred restructuring charges of $12.0 million related to this plan to date. We may incur similar charges in the future. Failure to achieve the expected cost reductions related to these restructuring initiatives could have a material adverse effect on our business and results of operations.

Our inability to obtain raw materials, component parts, and/or finished goods in a timelyattract and cost-effective manner from suppliers would adverselyretain additional personnel could affect our ability to manufacturesuccessfully grow our business.

Our performance is substantially dependent on the continued services and marketperformance of our products.senior management and other key personnel. Our performance also depends on our ability to retain and motivate our officers and key employees. The loss of the services

11

We purchase raw materials and component parts from suppliersof any of our executive officers or other key employees for use in manufacturingany reason could harm our products. We also purchase certain finished goods from suppliers. Changesbusiness. Transitions in our relationships with suppliers or increases in our costs for raw materials, component parts, or finished goods we purchase could result in manufacturing interruptions, delays, inefficiencies, or our inability to market products if we cannot timely and efficiently manufacture them. In addition, our gross margins could decrease if prices of purchased raw materials, component parts, or finished goods increase and we are unable to pass on such price increases to customers.

Regulations related to conflict mineralssenior executive management roles could adversely impact our business.

The Dodd-Frank Wall Street Reformstrategic planning, specifically resulting in unexpected changes, or delays in the planning and Consumer Protection Act contains provisions to improve transparency and accountability concerning the supply of certain minerals, known as “conflict minerals”, originating from the Democratic Republic of Congo (DRC) and adjoining countries. To implement this legislation, the SEC adopted annual disclosure and reporting requirements for those companies that use conflict minerals mined from the DRC and adjoining countries in their products. We will continue to incur costs associated with complying with these annual disclosure requirements, including those incurred to conduct diligence to determine the sources of conflict minerals used in our products and other potential changes to products, processes, or sources of supply as a

consequenceexecution of such verification activities. These rules could adversely affect the sourcing, supplyplans and pricingcan cause a diversion of materials used in our products. As there may be only a limited number of suppliers offering “conflict free” conflict minerals of certain types, we cannot be certain that we will continue to be able to obtain necessary conflict minerals from such suppliers in sufficient quantities or at competitive prices. Also, we may face reputational challenges if we determine that certain of our products contain minerals not determined to be conflict free or if we are unable to sufficiently verify the origins for all conflict minerals used in our products.management time and attention.

An increase in energy or raw material prices may reduce the profitability of our customers, which ultimately could negatively affect our business, financial condition, results of operations, and cash flows.

Energy prices are volatile and have been historically high. High energy prices have a negative trickledown effect on our customers’ business operations by reducing their profitability because of increased operating costs. Our customers require large amounts of energy to run their businesses, particularly in the air transportation industry. Higher energy prices can reduce passenger and cargo air carrier profitability as a result of increased jet and ground support equipment fuel prices. Higher energy prices also increase food processors’ operating costs through increased energy and utility costs to run their plants, higher priced chemical and petroleum based raw materials used in food processing, and higher fuel costs to run their logistics and service fleet vehicles.

Food processors are also affected by the cost and availability of raw materials such as feed grains, livestock, produce, and dairy products. Increases in the cost of and limitations in the availability of such raw materials can negatively affect the profitability of food processors’ operations.

Any reduction in our customers’ profitability due to higher energy or raw material costs or otherwise may reduce their future expenditures in the food processing equipment or airport equipment that we provide. This reduction may have a material adverse effect on our business, financial condition, results of operations, and cash flows.

Changes in food consumption patterns due to dietary trends or economic conditions may adversely affect our business, financial condition, results of operations, and cash flows.

Dietary trends can create demand for protein food products but negatively impact demand for high-carbohydrate foods, or create demand for easy to prepare, transportable meals but negatively impact traditional canned food products. Because different food types and food packaging can quickly go in and out of style as a function of dietary, health, or convenience trends, food processors can be challenged in accurately forecasting their needed manufacturing capacity and the related investment in equipment and services. During periods of economic uncertainty, consumer demand for protein products or processed food products may be negatively impacted by increases in food prices. A demand shift away from protein products or processed foods could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

An outbreak of animal borne diseases (H5N1, BSE, or other virus strains affecting poultry or livestock), citrus tree diseases, or food borne illnesses or other food safety or quality concerns may negatively affect our business, financial condition, results of operations, and cash flows.

An outbreak or pandemic stemming from H5N1 (avian flu) or BSE (mad cow disease) or any other animal related disease strains could reduce the availability of poultry or beef that is processed for the restaurant, food service, wholesale or retail consumer. Any limitation on the availability of such raw materials could discourage food producers from making additional capital investments in processing equipment, aftermarket products, parts, and services that our JBT FoodTech business provides. Such a decrease in demand for our products could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

The success of our business that serves the citrus food processing industry is directly related to the viability and health of citrus crops. The citrus industries in Florida, Brazil, and other countries are facing increased pressure on their harvest productivity and citrus bearing acreage due to citrus canker and greening diseases. These citrus tree diseases are often incurable once a tree has been infested and the end result can be the destruction of the tree. Reduced amounts of available fruit for the processed or fresh food markets could materially adversely affect our business, financial condition, results of operations, and cash flows.

In the event an E. coli or other food borne illness causes a recall of meat or produce, the companies supplying those fresh, further processed or packaged forms of those products could be severely adversely affected. Any negative impact on the financial viability of our fresh or processed food provider customers could adversely affect our immediate and recurring revenue base.


Freezes, hurricanes, droughts, or other natural disasters may negatively affect our business, financial condition, results of operations, and cash flows.

In the event a natural disaster negatively affects growers or farm production, the food processing industry may not have the fresh food raw materials necessary to meet consumer demand. Crops of entire groves or fields can be severely damaged by a drought, freeze, or hurricane. An extended drought or freeze or a high category hurricane could permanently damage or destroy a tree crop area. If orchards have to be replanted, trees may not produce viable product for several years. Since our recurring revenue is dependent on growers’ and farmers’ ability to provide high quality crops to certain of our customers, our business, financial condition, results of operations, and cash flows could be materially adversely impacted in the event of a freeze, hurricane, drought, or other natural disaster.

Our failure to comply with the laws and regulations governing our U.S. government contracts or the loss of production funding of any of our U.S. government contracts could harm our business.

The U.S. government represented approximately 2% of our 2017 revenue, directly or through subcontracts. Our JBT AeroTech business contracts with the U.S. government and subcontracts with defense contractors conducting business with U.S. government. As a result, we are subject to various laws and regulations that apply to companies doing business with the U.S. government.

The laws governing U.S. government contracts differ in several respects from the laws governing private company contracts. Government contracts are highly regulated to curb misappropriation of funds and to ensure uniform policies and practices across various governmental agencies. Funding for such contracts is tied to National Defense Budgets and Procurement Programs that are annually negotiated and approved or disapproved by the U.S. Department of Defense, the Executive Branch, and the Congress. For example, if there were any shifts in spending priorities or if funding for the military aircraft programs were reduced or canceled as a result of the sequestration, policy changes, or for other reasons, the resulting loss of revenue could have a material adverse impact on our JBT AeroTech business. Many U.S. government contracts contain pricing terms and conditions that are not applicable to private contracts. In particular, U.S. defense contracts are unilaterally terminable at the option of the U.S. government with compensation only for work completed and costs incurred to date. In addition, any deliverable delays under such contracts as a result of our non-performance could also have a negative impact on these contracts.

Non-compliance with the laws and regulations governing U.S. government contracts or subcontracts may result in significant sanctions such as debarment (restrictions from future business with the government). If we were found not to be in compliance now or in the future with any such laws or regulations, our results of operations could be adversely impacted.

Terrorist attacks and threats, escalation of military activity in response to such attacks, or acts of war may negatively affect our business, financial condition, results of operations, and cash flows.

Any future terrorist attacks against U.S. targets, rumors or threats of war, actual conflicts involving the United States or its allies, or military or trade disruptions affecting our customers or the economy as a whole may materially adversely affect our operations or those of our customers. As a result, there could be delays or losses in transportation and deliveries to our customers, decreased sales of our products, and delays in payments by our customers. Strategic targets such as those relating to transportation and food processing may be at greater risk of future terrorist attacks than other targets in the United States. Our airport authority, airline, air cargo and ground handling customers are particularly sensitive to safety concerns, and their businesses may decline after terrorist attacks or threats or during periods of political instability when travelers are concerned about safety issues. A decline in these customers’ businesses could have a negative impact on their demand for our products. It is possible that any of these occurrences, or a combination of them, could have a material adverse effect on our business, financial condition, results of operations, and cash flows.


The cumulative loss of several significant contracts may negatively affect our business, financial condition, results of operations, and cash flows.


We often enter into large, project-oriented contracts, or long-term equipment leases and service agreements. These agreements may be terminated or breached, or our customers may fail to renew these agreements. If we were to lose several significant agreements and if we were to fail to develop alternative business opportunities, then we could experience a material adverse effect on our business, financial condition, results of operations, and cash flows.



We may lose money or not achieve our expected profitability on fixed-price contracts.


As is customary for several of the business areas in which we operate, we may provide products and services under fixed-price contracts. Under such contracts, we are typically responsible for cost overruns. Our actual costs and any gross profit realized on these fixed-price contracts may vary from our estimates on which the pricing for such contracts was based. There are inherent risks and uncertainties in the estimation process, including those arising from unforeseen technical and logistical challenges or longer than expected lead times for sourcing raw materials and assemblies. A fixed-price contract may significantly limit or prohibit our ability to mitigate the impact of unanticipated increases in raw material prices (including the price of steel and other significant raw materials) by passing on such price increases. Depending on the volume of our work performed under fixed-price contracts at any one time, differences in actual versus estimated performance could have a material adverse impact on our business, financial condition, results of operations, and cash flows.


Customer sourcing initiatives may adversely affect our new equipmentWe attempt to offset these cost increases through increases in pricing and aftermarket businesses.

Many multi-national companies, including our customersefforts to lower costs through manufacturing efficiencies and prospective customers, have undertaken supply chain integration to provide a sustainable competitive advantage against their competitors. Under continued price pressure from consumers, wholesalers and retailers, our manufacturer customers are focused on controlling and reducing cost enhancing their sourcing processes, and improving their profitability.

A key value proposition of our equipment and services is low total cost of ownership. If our customers implement sourcing initiatives that focus solely on immediate cost savings and not on total cost of ownership, our new equipment and aftermarket sales could be adversely affected.

To remain competitive, we need to rapidly and successfully develop and introduce complex new solutions in a global, competitive, demanding, and changing environment.

If we lose our significant technology advantage in our products and services, our market share and growth could be materially adversely affected. In addition, if we are unable to deliver products, features, and functionality as projected, we may be unable to meet our commitments to customers, which could have a material adverse effect on our reputation and business. Significant investments in research and development efforts that do not lead to successful products, features, and functionality, could also materially adversely affect our business, financial condition, and results of operations.

Our business, financial condition, results of operations, and cash flows could be materially adversely affected by competing technology. Some of our competitors are large multinational companies that may have greater financial resources than us, and they may be able to devote greater resources to research and development of new systems, services, and technologies than we are able to do. Moreover, some of our competitors operate in narrow business areas, allowing them to concentrate their research and development efforts more directly on products and services for those areas than we may be able to.

High capacity products or products with new technology may be more likely to experience reliability, quality, or operability problems.

Even with rigorous testing prior to release and investment on product quality processes, problems may be found in newly developed or enhanced products after such products are launched and shipped to customers. Resolutionreductions. However the impact of such issues may cause project delays, additional developmentincrease costs and deferred or lost revenue.

New products and enhancements of our existing products may also reduce demand for our existing products or could delay purchases by customers who instead decide to wait for our new or enhanced products. Difficulties that arise in our managing the transition from our older products to our new or enhanced products could result in additional costs and deferred or lost revenue.

We may need to make significant capital and operating expenditures to keep pace with technological developments in our industry.

The industries in which we participate are constantly undergoing development and change, and it is likely that new products, equipment, and service methods will be introduced in the future. We may need to make significant expenditures to purchase new equipment and to train our employees to keep pace with any new technological developments. These expenditures could adversely affect our results of operations and financial condition.


If we are unable to develop, preserve, and protect our intellectual property assets, our business, financial condition, results of operations, and cash flows may be negatively affected.

We strive to protect and enhance our proprietary intellectual property rights through patent, copyright, trademark, and trade secret laws, as well as through technological safeguards and operating policies and procedures. To the extent we are not successful, our business, financial condition, results of operations, and cash flows could be materially adversely impacted. We may be unable to prevent third parties from using our technology without our authorization, or from independently developing technology that is similar to ours, particularly in those countries where the laws do not protect our proprietary rights as fully as in others. With respect to our pending patent applications, we may not be successful in securing patents for these claims, and our competitors may already have applied for patents that, once issued, will prevail over our patent rights or otherwise limit our ability to sell our products.fully mitigated.


Claims by others that we infringe their intellectual property rights could harm our business, financial condition, results of operations, and cash flows.

We have seen a trend towards aggressive enforcement of intellectual property rights as product functionality in our industry increasingly overlaps and the number of issued patents continues to grow. As a result, there is a risk that we could be subject to infringement claims which, regardless of their validity, could:

be expensive, time consuming, and divert management attention away from normal business operations;

require us to pay monetary damages or enter into non-standard royalty and licensing agreements;

require us to modify our product sales and development plans; or

require us to satisfy indemnification obligations to our customers.

Regardless of whether these claims have any merit, they can be burdensome and costly to defend or settle and can harm our business and reputation.

Infrastructure failures or catastrophic loss at any of our facilities, including damage or disruption to our information systems and information database, could lead to production orand service curtailments or shutdowns.shutdowns and negatively affect our business, financial condition, results of operations, and cash flows.


We manufacture our products at facilities in the United States, Belgium, China, Sweden, Brazil, Italy, Spain, United Kingdom, the Netherlands and Germany. An interruption in production or service capabilities at any of our facilities as a result of equipment failure or any other reasons could result in our inability to manufacture our products. In the event of a stoppage in production at any of our facilities, even if only temporary, or if we experience delays as a result of events that are beyond our control, delivery times to our customers could be severely affected. Any significant delay in deliveries to our customers could lead to cancellations. Our facilities are also subject to the risk of catastrophic loss due to unanticipated events such as earthquake, fire, natural disaster, explosions, power loss, unauthorized intrusions, and other catastrophic events. We may also experience plant shutdowns or periods of reduced production as a result of equipment failure, delays in deliveries or catastrophic loss, which could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

The business continuity of our information systems, computer equipment, and information databases are critical to our business operations, and any damage or disruptions could negatively affect our business, financial condition, results of operations, and cash flows.


Our operations are also dependent on our ability to protect our facilities, computer equipment and the information stored in our databases from damage by, among other things, earthquake, fire, natural disaster, explosions, power loss, telecommunications failures, unauthorized intrusions,hurricane, and other catastrophic events. AFor instance, a part of our operations is based in an area of California that has experienced earthquakes and wildfires and other natural disasters, while another part of our operations is based in an area of Florida that has experienced hurricanes and other natural disasters.

Despite our best efforts at planning for such contingencies, catastrophic events of this nature may still result in delays in deliveries, catastrophic loss, system failures and other interruptions in our operations, which could have a material adverse effect on our business, financial condition, results of operations, and cash flows.


In addition, it is periodically necessary to replace, upgrade, or modify our internal information systems. For example we are currently in the process of implementing common Enterprise Resource Planning (ERP) systems across the majority of our businesses. If we are unable to do this in a timely and cost-effective manner, especially in light of demands on our information technology resources, our ability to capture and process financial transactions and therefore our business, financial condition, results of operations, and cash flows may be materially adversely impacted.



12

We are subject to cyber-security risks arising out of breaches of security relating to sensitive company, client,customer, and employee information and to the technology that manages our operations and other business processes.


Our business operations rely upon secure information technology systems for data capture, processing, storage, and reporting. Notwithstanding careful security and controls design, our information technology systems, and those of our third-party providers could become subject to cyber-attacks. Network, system, application, and data breaches could result in operational disruptions or information misappropriation, including, but not limited to, interruptionsinability to utilize our systems, availability and denial of access to and misuse of applications required by our clients to conduct business with us. Phishing and other forms of electronic fraud may also subject us to risks associated with improper access to financial assets, customer information and customer information.diversion of payments. Theft of intellectual property or trade secrets and inappropriate disclosure of confidential information could stem from such incidents. Any such operational disruption and/or misappropriation of information could result in lost sales, negative publicity or business delays and could have a material adverse effect on our business. In addition, requirements under the privacy laws of the jurisdictions in which we operate, such as the EU General Data Protection Regulation (GDPR) and California Consumer Privacy Act impose significant costs that are likely to increase over time.


Our results of operations can be adversely affected by labor shortages, turnover and labor cost increases.

We have from time-to-time experienced labor shortages and other labor-related issues. These labor shortages have become more pronounced as a result of the COVID-19 pandemic and a sharp increase in demand for industrial goods as the global economy recovers from the effects of the pandemic. A number of factors may adversely affect the labor force available to us in one or more of our markets, including high employment levels, federal unemployment subsidies, and other government regulations, which include laws and regulations related to workers’ health and safety, wage and hour practices and immigration. These factors can also impact the cost of labor. Increased turnover rates within our employee base can lead to decreased efficiency and increased costs, such as increased overtime to meet demand and increased wage rates to attract and retain employees. An overall labor shortage or lack of skilled labor, increased turnover, higher rates of absenteeism or labor inflation could have a material adverse effect on our results of operations.

INDUSTRY RISKS

Deterioration of economic conditions could adversely impact our business.

Our business success depends on retaining our senior managementmay be adversely affected by changes in current or future national or global economic conditions, including lower growth rates or recession, high unemployment, rising interest rates, limited availability of capital, decreases in consumer spending rates, the availability and cost of energy, tightening of government monetary policies to contain inflation and the effect of government deficit reduction, sequestration, and other key personnelausterity measures impacting the markets we serve. Any such changes could adversely affect the demand for our products or the cost and attractingavailability of our required raw materials, which can have a material adverse effect on our financial results. Adverse national and retainingglobal economic conditions could, among other qualified employees.things:


•make it more difficult or costly for us to obtain necessary financing for our operations, our investments and our acquisitions, or to refinance our debt;

•cause our lenders or other financial instrument counterparties to be unable to honor their commitments or otherwise default under our financing arrangements;

•impair the financial condition of some of our customers, thereby hindering our customers’ ability to obtain financing to purchase our products and/or increasing customer bad debts;

•cause customers to forgo or postpone new purchases in favor of repairing existing equipment and machinery, and delay or reduce preventative maintenance, thereby reducing our revenue and/or profits;

•negatively impact our customers’ ability to raise pricing to counteract increased fuel, labor, and other costs, making it less likely that they will expend the same capital and other resources on our equipment as they have in the past;

•impair the financial condition of some of our suppliers thereby potentially increasing both the likelihood of our having to renegotiate supply terms on terms that may not be as favorable to us and the risk of non-performance by suppliers;

•negatively impact global demand for air transportation services as well as for technologically sophisticated food production equipments, which could result in a reduction of sales, operating income, and cash flows in our AeroTech and FoodTech segments;
13


•negatively affect the rates of expansion, consolidation, renovation, and equipment replacement within the air transportation industry and within the food processing industry, which may adversely affect the results of operations of our AeroTech and FoodTech segments; and

•impair the financial viability of our insurers.

Variability in the length of our sales cycles makes accurate estimation of our revenue in any single period difficult and can result in significant fluctuation in quarterly operating results.

The length of our sales cycle varies depending on a number of factors over which we may have little or no control, including the size and complexity of a potential transaction, the level of competition that we encounter during our selling process, and our current and potential customers’ internal budgeting and approval processes. Many of our sales are subject to an extended sales cycle. As a result, we may expend significant effort and resources over long periods of time in an attempt to obtain an order, but ultimately not obtain the order, or obtain an order that is smaller than we anticipated. Revenue generated by any one of our customers may vary from quarter to quarter, and a customer who places a large order in one quarter may generate significantly lower revenue in subsequent quarters. Due to the length and uncertainty of our sales cycle, and the variability of orders from period to period, we believe that quarter-to-quarter comparisons of our revenue and operating results may not be an accurate indicator of our future performance.

Our inability to secure raw material supply, component parts, sub assemblies, finished good assemblies, installation labor, and/or logistics capacity in a timely and cost-effective manner from suppliers would adversely affect our ability to manufacture, install and/or distribute products to customers.

We dependpurchase raw materials, component parts, sub assemblies, and/or finished good assemblies for use in manufacturing, installation, service and/or distribution of our products to customers. Logistics availability and other external factors impacting our inbound and outbound transportation, raw material supply, component parts, sub assemblies, and/or finished goods we procure could result in manufacturing, installation and/or outbound transportation delays, inefficiencies, or our inability to distribute products if we cannot timely and efficiently manufacture them. In addition, our gross margins could be adversely impacted if raw materials, component parts, sub assemblies, finished goods, installation services and/or logistics provider's higher costs cannot be offset with timely pricing increases to customers.

The disruptions to the global economy, which began in 2020 and continued throughout the years 2021 and 2022 have impeded global supply chains, resulting in longer lead times and increased raw material costs. We have taken steps to minimize the impact of these increased costs by working closely with our suppliers and customers. Despite the actions we have taken to minimize the impacts of supply chain disruptions, there can be no assurances that unforeseen future events in the global supply chain and inflationary pressures will not have a material adverse effect on our senior executive officersbusiness, financial condition and results of operations.

An increase in energy or raw material prices may reduce the profitability of our customers, which ultimately could negatively affect our business, financial condition, results of operations, and cash flows.

Energy prices are volatile globally, but are especially high in Europe, as a result of the war in the Ukraine. High energy prices have a negative trickledown effect on our customers’ business operations by reducing their profitability because of increased operating costs. Our customers require large amounts of energy to run their businesses, particularly in the air transportation industry. Higher energy prices can reduce passenger and cargo air carrier profitability as a result of increased jet and ground support equipment fuel prices. Higher energy prices also increase food processors’ operating costs through increased energy and utility costs to run their plants, higher priced chemical and petroleum based raw materials used in food processing, and higher fuel costs to run their logistics and service fleet vehicles.

Food processors are also affected by the cost and availability of raw materials such as feed grains, livestock, produce, and dairy products. Increases in the cost and limitations in the availability of such raw materials can negatively affect the profitability of food processors’ operations.

Any reduction in our customers’ profitability due to higher energy or raw material costs or otherwise may reduce their future expenditures for the food processing equipment or airport equipment that we provide. This reduction may have a material adverse effect on our business, financial condition, results of operations, and cash flows.

14

Changes in food consumption patterns due to dietary trends or economic conditions may adversely affect our business, financial condition, results of operations, and cash flows.

Dietary trends can create demand for protein food products but negatively impact demand for high-carbohydrate foods, or create demand for easy to prepare, transportable meals but negatively impact traditional canned food products. Because different food types and food packaging can quickly go in and out of style as a function of dietary, health, convenience, or sustainability trends, food processors can be challenged in accurately forecasting their needed manufacturing capacity and the related investment in equipment and services. Rising food and other key personnel. input costs, and recessionary fears may negatively impact our customer's ability to forecast consumer demand for protein products or processed food products and as a result negatively impact our customer's demand for our goods and services. A demand shift away from protein products or processed foods could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

Freezes, hurricanes, droughts, other natural disasters, adverse weather conditions, outbreak of animal borne diseases (H5N1, BSE, or other virus strains affecting poultry or livestock), citrus tree diseases, or food borne illnesses or other food safety or quality concerns may negatively affect our business, financial condition, results of operations, and cash flows.

An outbreak or pandemic stemming from H5N1 (avian flu), BSE (mad cow disease), African swine fever (pork) or any other animal related disease strains could reduce the availability of poultry or beef that is processed for the restaurant, food service, wholesale or retail consumer. Any limitation on the availability of such raw materials could discourage food producers from making additional capital investments in processing equipment, aftermarket products, parts, and services that our FoodTech business provides. Such a decrease in demand for our products could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

The losssuccess of anyour business that serves the citrus food processing industry is directly related to the viability and health of these officerscitrus crops. The citrus industries in Florida, Brazil, and other countries are facing increased pressure on their harvest productivity and citrus bearing acreage due to citrus canker and greening diseases. These citrus tree diseases are often incurable once a tree has been infested and the end result can be the destruction of the tree. Reduced amounts of available fruit for the processed or key personnelfresh food markets could materially adversely affect our business, financial condition, results of operations, and cash flows. In addition, competition for skilled and non-skilled employees among companies that rely heavily on engineering, technology, and manufacturing is intense, and the loss of skilled or non-skilled employees or an inability to attract, retain, and motivate additional skilled and non-skilled employees required for the operation and expansion of our business could hinder our ability to conduct research activities successfully, develop new products and services and meet our customers’ requirements.


The industries in which we operate expose us to potential liabilities arising out of the installation or use of our systems that could negatively affect our business, financial condition, results of operations, and cash flows.

Our equipment, systems and services create potential exposure for us for personal injury, wrongful death, product liability, commercial claims, product recalls, production loss, property damage, pollution, and other environmental damages. In the event that a customer who purchases our equipment becomes subject to claims relating to food borne illnessesan E. coli or other food safetyborne illness causes a recall of meat or quality issues relating to foodproduce, the companies supplying those fresh, further processed throughor packaged forms of those products could be severely adversely affected. Any negative impact on the usefinancial viability of our equipment, wefresh or processed food provider customers could be exposedadversely affect our immediate and recurring revenue base. We also face the risk of direct exposure to significant claims from our customers. Although we have obtained business and related risk insurance, we cannot assure youliabilities associated with product recalls to the extent that our insurance willproducts are determined to have caused an issue leading to a recall.

In the event a natural disaster negatively affects growers or farm production, the food processing industry may not have the fresh food raw materials necessary to meet consumer demand. Crops or entire groves or fields can be adequateseverely damaged by a drought, flood, freeze, or hurricane, wildfires or adverse weather conditions, including the effects of climate change. An extended drought or freeze or a high category hurricane could permanently damage or destroy a tree crop area. If orchards have to cover all potential liabilities. Further, we cannot assure you that insurance will generally be available in the future or, if available, that premiumsreplanted, trees may not produce viable product for several years. Since our recurring revenue is dependent on growers’ and farmers’ ability to obtain such insurance will be commercially reasonable. If we incur substantial liability and damages arising from such liability are not covered by insurance or are in excessprovide high quality crops to certain of policy limits, or if we were to incur liability at a time when we are not able to obtain liability insurance,our customers, our business, financial condition, results of operations, and cash flows could be materially adversely impacted in the event of a freeze, hurricane, drought, or other natural disaster.

Our failure to comply with the laws and regulations governing our U.S. government contracts or the loss of production funding of any of our U.S. government contracts could harm our business.

The U.S. government represented approximately 1% of our 2022 revenue, directly or through subcontracts. Our AeroTech business contracts with the U.S. government and subcontracts with defense contractors conducting business with the U.S. government. As a result, we are subject to various laws and regulations that apply to companies doing business with the U.S. government.

The laws governing U.S. government contracts differ in several respects from the laws governing private company contracts. Government contracts are highly regulated to curb misappropriation of funds and to ensure uniform policies and practices across various governmental agencies. Funding for such contracts is tied to national defense budgets and procurement programs that are annually negotiated and require approvals by the U.S. Department of Defense, the Executive Branch, and the Congress. For example, if there were any shifts in spending priorities or if funding for the defense aircraft programs were reduced or canceled as a result of the sequestration, policy changes, or for other reasons, the resulting loss of revenue could have an adverse impact on our AeroTech business. Many U.S. government contracts contain pricing terms and conditions that are not applicable to private contracts. In particular, U.S. defense contracts are unilaterally terminable at the option of the U.S. government with compensation only for work completed and costs incurred to date. In addition, any deliverable delays under such contracts as a result of our non-performance could also have a negative impact on these contracts.
15


Non-compliance with the laws and regulations governing U.S. government contracts or subcontracts may result in significant sanctions such as debarment (restrictions from future business with the government). If we were found not to be in compliance now or in the future with any such laws or regulations, our results of operations could be adversely impacted.

Customer sourcing initiatives may adversely affect our new equipment and aftermarket businesses.

Many multi-national companies, including our customers and prospective customers, have undertaken supply chain integration initiatives to provide a sustainable competitive advantage against their competitors. Under continued price pressure from consumers, wholesalers and retailers, our manufacturer customers are focused on controlling and reducing cost, enhancing their sourcing processes, and improving their profitability.

A key value proposition of our equipment and services is low total cost of ownership. If our customers implement sourcing initiatives that focus solely on immediate cost savings and not on total cost of ownership, our new equipment and aftermarket sales could be adversely affected.


Our business could suffer in the event of a work stoppage by our unionized or non-union labor force.

A portion of our employees in the United States are represented by collective bargaining agreements. Outside the United States, we enter into employment contracts and agreements in certain countries in which national employee unions are mandatory or customary, such as in Belgium, Sweden, Spain, Italy, the Netherlands, Germany and China.

Any future strikes, employee slowdowns, or similar actions by one or more unions, in connection with labor contract negotiations or otherwise, could have a material adverse effect on our ability to operate our business.

LEGAL AND REGULATORY RISKS

Disruptions in the political, regulatory, economic and social conditions of the countries in which we conduct business could negatively affect our business, financial condition, and results of operations.

We operate manufacturing facilities in many countries other than the United States, the largest of which are located in Belgium, Sweden, Brazil, Italy, Spain, United Kingdom, the Netherlands and Germany. Our international sales accounted for 36% of our 2022 revenue. Multiple factors relating to our international operations and to those particular countries in which we operate or seek to expand our operations could have an adverse effect on our financial condition or results of operations. These factors include, among others:

•economic downturns, inflationary and recessionary markets, including in capital and equity markets;
•civil unrest, political instability, terrorist attacks, and wars;
•nationalization, expropriation, or seizure of assets;
•potentially unfavorable tax law changes;
•inability to repatriate income or capital;
•foreign ownership restrictions;
•export regulations that could erode profit margins or restrict exports, including import or export licensing regulations;
•trade restrictions, tariffs, and other trade protection measures, or price controls;
•restrictions on operations, trade practices, trade partners, and investment decisions resulting from domestic and foreign laws and regulations;
•compliance with the U.S. Foreign Corrupt Practices Act and other similar laws;
•burden and cost of complying with different national and local laws, treaties, and technical standards and changes in those regulations;
•transportation delays and interruptions; and
•reductions in the availability of qualified personnel.

Changes to trade regulation, quotas, duties or tariffs, caused by the changing U.S. and geopolitical environments or otherwise, may increase our costs or limit the amount of raw materials and products that we can import, or may otherwise adversely impact or business.
The U.S. government imposes the import duties or other restrictions on products or raw materials sourced from countries that it perceives as engaging in unfair trade practices. For instance, since 2018, the U.S. government has imposed tariffs on steel and aluminum imports and on specified imports from China. In response to these tariffs, several major U.S. trading partners have imposed, or announced their intention to impose, tariffs on U.S. goods. We import raw materials from or manufacture our products in China and
16

other such countries subject to these tariffs. Any such duties or restrictions could have a material adverse effect on our business, results of operations or financial condition. 
Moreover, these tariffs, or other changes in U.S. trade policy, could trigger retaliatory actions by affected countries. A “trade war” of this nature or other governmental action related to tariffs or international trade agreements or policies has the potential to adversely impact demand for our products, our costs, customers, suppliers and/or the U.S. economy or certain sectors thereof and, thus, to adversely impact our businesses.

Climate change and climate change legislation or regulations may adversely affect our business, financial condition, results of operations, and cash flows.

Increasing attention to climate change, increasing societal expectations on companies to address climate change and changes in consumer preferences may result in increased costs, reduced demand for our products and the products of our customers, reduced profits, risks associated with new regulatory requirements, risks to our reputation and the potential for increased litigation and governmental investigations. Foreign, federal, state and local regulatory and legislative bodies have proposed various legislative and regulatory measures relating to increased transparency and standardization of reporting related to factors that may be contributing to climate change, regulating GHG emissions, and energy policies. If such legislation or regulations are enacted, we could incur increased energy, environmental and other costs and we may need to make capital expenditures to comply with these legislative and regulatory requirements. Failure to comply with these regulations could result in monetary penalties and could adversely affect our business, financial condition, results of operations and cash flows. We could also face increased costs related to defending and resolving legal claims related to climate change and the alleged impact of our operations on climate change.

Further, customer, investor, and employee expectations relating to environmental, social and governance (ESG) have been rapidly evolving. Enhanced stakeholder focus on ESG issues related to our industry requires continuous monitoring of various and evolving standards and expectations and the associated reporting requirements. A failure to adequately meet stakeholder expectations may result in the loss of business, diluted market valuation, and an inability to attract and retain customers and employees.

From time to time, in alignment with our sustainability priorities, we may establish and publicly announce climate-related goals. If we fail to achieve or improperly report on our progress toward achieving our sustainability goals and commitments, the resulting negative publicity could adversely affect our reputation and our access to capital.

Environmental protection initiatives may negatively impact the profitability of our business.

Future environmental regulatory developments in the United States and abroad concerning environmental issues, such as climate change, could adversely affect our operations and increase operating costs and, through their impact on our customers, reduce demand for our products and services. Actions may be taken in the future by the U.S. government, state governments within the United States, foreign governments, or by signatory countries through a new global climate change treaty to regulate the emission of greenhouse gases. Pressures to reduce the footprint of carbon emissions impact the air transportation and manufacturing sectors. Airports, airlines, and air cargo providers are continually looking for new ways to become more energy efficient and reduce pollutants. Manufacturing plants are seeking means to reduce their heat-trapping emissions and minimize their energy and water usage. The precise nature of any such future environmental regulatory requirements and their applicability to us and our customers are difficult to predict, but the impact to us and the industries that we serve would likely be adverse and could be significant, including the potential for increased fuel costs, carbon taxes or fees, or a requirement to purchase carbon credits.credits, and increased cost related to emission controls, energy use reduction, and to develop alternative technologies with lower emissions.


Our operations and industries are subject to a variety of U.S. and international laws, which can change. We therefore face uncertainties with regard to lawsuits, regulations, and other related matters.


In the normal course of business, we are subject to proceedings, lawsuits, claims, and other matters, including those that relate to the environment, health and safety, employee benefits, import and export compliance, intellectual property, product liability, tax matters, securities regulation, and regulatory compliance. For example, we are subject to changes in foreign laws and regulations that may encourage or require us to hire local contractors or require foreign contractors to employ citizens of, or purchase supplies from, a particular non-U.S. jurisdiction. In addition, environmental laws and regulations affect the systems and services we design, market and sell, as well as the facilities where we manufacture our systems. We are required to invest financial and managerial resources to comply with environmental laws and regulations and anticipate that we will continue to be required to do so in the future.



17

We could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar worldwide anti-bribery laws.


The U.S. Foreign Corrupt Practices Act (FCPA), the U.K. Bribery Act of 2010 (the U.K. Bribery Act), and similar anti-bribery laws in other jurisdictions generally prohibit companies and their intermediaries from making improper payments for the purpose of obtaining or retaining business. Our policies mandate compliance with these anti-bribery laws. We operate in many parts of the world that have experienced governmental corruption to some degree and, in certain circumstances, strict compliance with anti-bribery laws may conflict with local customs and practices. Despite our training and compliance programs, there is no assurance that our internal control policies and procedures will protect us from acts committed by our employees or agents. If we are found to be liable for FCPA, the U.K. Bribery Act or other similar violations (either due to our own acts, or our inadvertence, or due to the acts or inadvertence of others), we could suffer from civil and criminal penalties or other sanctions, which could have a material adverse impact on our business, financial condition, and results of operations.


We are subject to governmental export controls and economic sanctions laws that could impair our ability to compete in international markets and subject us to liability if we are not in full compliance with applicable laws.


Our business activities are subject to various restrictions under U.S. export controls and trade and economic sanctions laws, including the U.S. Commerce Department’s Export Administration Regulations (EAR), the International Traffic in Arms Regulations (ITAR), and economic and trade sanctions regulations maintained by the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC). We are subject to similar laws and regulations in other countries in which we operate or make sales. If we fail to comply with these laws and regulations, we and certain of our employees could be subject to civil or criminal penalties and reputational harm. Obtaining the necessary authorizations, including any required license, for a particular transaction may be time-consuming, is not guaranteed, and may result in the delay or loss of sales opportunities. Furthermore, U.S. export control laws and economic sanctions laws in the U.S. and other countries prohibit certain transactions with U.S. embargoed or sanctioned countries, governments, persons and entities. Although we take precautions to prevent transactions with sanction targets, the possibility exists that we could inadvertently provide our products or services to persons prohibited by sanctions. This could result in negative consequences to us, including government investigations, penalties, and reputational harm.


Unfavorable tax law changes and tax authority rulings may adversely affect results.


We are subject to income taxes in the United States and in various foreign jurisdictions. Domestic and international tax liabilities are subject to the allocation of income among various tax jurisdictions. Our effective tax rate could be adversely affected by changes in the geographic mix of earnings among countries with differing statutory tax rates,earnings. Additionally, changes in the valuation allowancetax laws where we have significant operations, including rate changes or corporate tax provisions that disallow or tax perceived base erosion or profit shifting payments or subject us to new types of tax, could materially affect our effective tax rate and our deferred tax assets orand liabilities. We continue to monitor countries’ progress toward enactment of the Organization of Economic Cooperation and Development’s model rules on a global minimum tax. During December 2022, the European Union reached agreement on the introduction of a minimum tax laws. The amount of income taxesdirective requiring each member state to enact local legislation, we will continue to evaluate it as additional guidance and other taxesclarification becomes available.

We are subject to ongoing audits by U.S. federal, state, and local tax authorities and by non-U.S. authorities. If these audits result in assessments different from amounts we record,recorded, future financial results may include unfavorable tax adjustments.


BUSINESS STRATEGY RISKS
We face risks associated with current and future acquisitions.

To achieve our strategic objectives, we have pursued and expect to continue to pursue expansion opportunities such as acquiring other businesses or assets. Expanding through acquisitions involves risks such as:
•the incurrence of additional debt to finance the acquisition or expansion;

•additional liabilities (whether known or unknown), including, among others, product, environmental or pension liabilities of the acquired business or assets;

•risks and costs associated with integrating the acquired business or new facility into our operations;

•the need to retain and assimilate key employees of the acquired business or assets;

•unanticipated demands on our management, operational resources and financial and internal control systems;

•unanticipated regulatory risks;

18

•the risk of being denied the necessary licenses, permits and approvals from state, local and foreign governments, and the costs and time associated with obtaining such licenses, permits and approvals;

•risks that we do not achieve anticipated operating efficiencies, synergies and economies of scale;

•risks in retaining the existing customers and contracts of the acquired business or assets; and.

•risk that unforeseen issues with an acquisition may adversely affect the anticipated results of the business or value of the intangible assets and trigger an evaluation of the recoverability of the recorded goodwill and intangible assets for such business.

If we repatriateare unable to effectively integrate acquired businesses or newly formed operations, or if such acquired businesses underperform relative to our expectations, this may have a material adverse effect on our business, financial position, and results of operations.

We face risks associated with implementing strategic alternatives for AeroTech.

As previously announced in the first quarter of 2022, we are considering a full range of strategic alternatives for AeroTech and expect to complete our strategic assessment in the first half of 2023. We may face difficulty in implementing this business strategy, including our ability to identify or develop any cashstrategic alternatives or execute on material aspects of such strategic alternatives and cash equivalentsmeet this anticipated timing. Additionally, difficulty in debt and capital markets to raise capital may adversely impact our ability to execute on this business strategy. As a result, we may not be able to achieve the potential benefits of such strategic alternatives.

We have invested substantial resources in certain markets and strategic initiatives where we expect growth, and our business may suffer if we are unable to achieve the growth we expect.
As part of our strategy to grow, we are expanding our operations in certain emerging or developing markets, and accordingly have made and expect to continue to make investments to support anticipated growth in those regions. We have also increased our investments in our digital solution, OmniBluTM, to support potential growth in parts and service revenue as well as the new revenue source of digital software subscriptions. We may fail to realize expected rates of return on our existing investments or incur losses on such investments, and we may be unable to redeploy capital to take advantage of other markets, business lines or other potential areas of growth. Our results will also suffer if these developing markets, business lines or capabilities do not grow as quickly as we anticipate.

Our restructuring initiatives may not achieve the expected cost reductions or other anticipated benefits.

We regularly evaluate our existing operations, service capacity, and business efficiencies to determine if a realignment or restructuring could improve our results of operations or achieve some other business goal. Our realignment and restructuring initiatives are designed to result in more efficient and increasingly profitable operations. Our ability to achieve the anticipated cost savings and other benefits from our foreign subsidiaries backthese initiatives within the expected time frame is subject to the U.S., we could bemany estimates and assumptions. These estimates and assumptions are subject to significant tax liabilities.

Aseconomic, competitive, and other uncertainties, some of December 31, 2017,which are beyond our foreign subsidiaries held $29.8 million, or 88%, of our cash and cash equivalents. While we currently intend that cash and cash equivalents held bycontrol. Failure to achieve the expected cost reductions related to these foreign subsidiaries will be indefinitely reinvested in foreign jurisdictions in order to fund working capital requirements, make investments, and repay debt (primarily inter-company), if, in the future, cash and cash equivalents held by foreign subsidiaries are needed to fund our operations in the United States or for the purpose of making certain strategic investments in the United States or otherwise, the repatriation of such amounts to the United States could result in a significant incremental tax liability in the period in which the decision to repatriate occurs. Payment of any incremental tax liability would reduce the cash available to us to fund our operations or to make such strategic investment in the United States or otherwise.

Our business could suffer in the event of a work stoppage by our unionized or non-union labor force.

A portion of our employees in the United States are represented by collective bargaining agreements. Outside the United States, we enter into employment contracts and agreements in those countries in which such relationships are mandatory or customary, such as in Belgium, Sweden, Spain, Italy, the Netherlands and China.

Any future strikes, employee slowdowns, or similar actions by one or more unions, in connection with labor contract negotiations or otherwise,restructuring initiatives could have a material adverse effect on our business and results of operations.

The industries in which we operate expose us to potential liabilities arising out of the installation or use of our systems that could negatively affect our business, financial condition, results of operations, and cash flows.
Our equipment, systems and services create potential exposure for us for personal injury, wrongful death, product liability, commercial claims, product recalls, business interuption, production loss, property damage, pollution, and other environmental damages. In the event that a customer who purchases our equipment becomes subject to claims relating to food borne illnesses or other food safety or quality issues relating to food processed through the use of our equipment, we could be exposed to significant claims from our customers. Although we have obtained business and related risk insurance, we cannot assure you that our insurance will be adequate to cover all potential liabilities. Further, we cannot assure you that insurance will generally be available in the future or, if available, that premiums to obtain such insurance will be commercially reasonable. If we incur substantial liability and damages arising from such liability are not covered by insurance or are in excess of policy limits, or if we were to incur liability at a time when we are not able to obtain liability insurance, our business, financial condition, results of operations, and cash flows could be materially adversely affected.

19

TECHNOLOGY RISKS

To remain competitive, we need to rapidly and successfully develop and introduce complex new solutions in a global, competitive, demanding, and changing environment.

If we lose our significant technology advantage in our products and services, our market share and growth could be materially adversely affected. In addition, if we are unable to deliver products, features, and functionality as projected, we may be unable to meet our commitments to customers, which could have a material adverse effect on our reputation and business. Significant investments in research and development efforts that do not lead to successful products, features, and functionality, could also materially adversely affect our business, financial condition, and results of operations.

In 2022, we launched a new subscription-based digital solution called OmniBlu™, which will be a complex, evolving, and long-term initiative that will involve collaboration with our food-processing customers. However, OmniBlu™ may not develop in accordance with our timelines, which could result in the competitive market outpacing our development. There is some uncertainty in the pace and depth of market acceptance of digital solutions in this industry. Our efforts in development and deployment of OmniBlu™ may also divert resources and management attention from other areas of our business. We expect to continue making significant investments to support these efforts, and our ability to operatesupport these efforts is dependent on generating sufficient profits from other areas of our business.



Our business, financial condition, results of operations, and cash flows could be materially adversely affected by competing technology. Some of our competitors are large multinational companies that may have greater financial resources than us, and they may be able to devote greater resources to research and development of new systems, services, and technologies than we are able to do. Moreover, some of our competitors operate in narrow business areas, allowing them to concentrate their research and development efforts more directly on products and services for those areas than we may be able to.

High capacity products or products with new technology may be more likely to experience reliability, quality, or operability problems.

Even with rigorous testing prior to release and investment in product quality processes, problems may be found in newly developed or enhanced products after such products are launched and shipped to customers. Resolution of such issues may cause project delays, additional development costs, and deferred or lost revenue.

New products and enhancements of our existing products may also reduce demand for our existing products or could delay purchases by customers who instead decide to wait for our new or enhanced products. Difficulties that arise in our managing the transition from our older products to our new or enhanced products could result in additional costs and deferred or lost revenue.

We may need to make significant capital and operating expenditures to keep pace with technological developments in our industry.

The industries in which we participate are constantly undergoing development and change, and it is likely that new products, equipment, and service methods will be introduced in the future. We may need to make significant expenditures to purchase new equipment, develop digital solutions, and to train our employees to keep pace with any new technological developments and market. These expenditures could adversely affect our results of operations and financial condition.

If we are unable to develop, preserve, and protect our intellectual property assets, our business, financial condition, results of operations, and cash flows may be negatively affected.

We strive to protect and enhance our proprietary intellectual property rights through patent, copyright, trademark, and trade secret laws, as well as through technological safeguards and operating policies and procedures. It may be costly and time consuming to protect our intellectual property, and the steps we have taken to do so in the U.S. and foreign countries may not be adequate. To the extent we are not successful, our business, financial condition, results of operations, and cash flows could be materially adversely impacted. We may be unable to prevent third parties from using our technology without our authorization, or from independently developing technology that is similar to ours, particularly in those countries where the laws do not protect our proprietary rights as fully as in others. With respect to our pending patent applications, we may not be successful in securing patents for these claims, and our competitors may already have applied for patents that, once issued, will prevail over our patent rights or otherwise limit our ability to sell our products.

20

Claims by others that we infringe their intellectual property rights could harm our business, financial condition, results of operations, and cash flows.

We have seen a trend towards aggressive enforcement of intellectual property rights as product functionality in our industry increasingly overlaps and the number of issued patents continues to grow. As a result, there is a risk that we could be subject to infringement claims which, regardless of their validity, could:

•be expensive, time consuming, and divert management attention away from normal business operations;
•require us to pay monetary damages or enter into non-standard royalty and licensing agreements;
•require us to modify our product sales and development plans; or
•require us to satisfy indemnification obligations to our customers.

Regardless of whether these claims have any merit, they can be burdensome and costly to defend or settle and can harm our business and reputation.

RISKS RELATED TO OWNERSHIP OF OUR SECURITIES

The convertible note hedge and warrant transactions may negatively affect the value of the Notes and our common stock.

In connection with the pricing of our Convertible Senior Notes due 2026 (the "Notes"), we entered into convertible note hedge transactions (the "Hedge Transactions") with the option counterparties. We also entered into warrant transactions with the option counterparties. The Hedge Transactions are expected generally to reduce the potential dilution to our common stock upon any conversion of Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted Notes, as the case may be. However, the warrant transactions could separately have a dilutive effect on our common stock to the extent that the market price per share of our common stock exceeds the strike price of the warrants.

The option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to our common stock and/or purchasing or selling our common stock or other securities of ours in secondary market transactions following the pricing of the Notes and prior to the maturity of the Notes (and are likely to do in connection with any conversion of the Notes or redemption or repurchase of the Notes). This activity could also cause or avoid an increase or a decrease in the market price of our common stock or the Notes, which could affect the Note holders' ability to convert the Notes and, to the extent the activity occurs during any observation period related to a conversion of the Notes, it could affect the number of shares and value of the consideration that Note holders will receive upon conversion of the Notes.

We are subject to counterparty risk with respect to the convertible note hedge transactions.

The option counterparties are financial institutions, and we are subject to the risk that any or all of them might default under the Hedge Transactions. Our exposure to the credit risk of the option counterparties is not secured by any collateral.

If an option counterparty becomes subject to insolvency proceedings, we will become an unsecured creditor in those proceedings with a claim equal to our exposure at that time under the Hedge Transactions with such option counterparty. Our exposure will depend on many factors but, generally, an increase in our exposure will be correlated to an increase in the market price and in the volatility of our common stock. In addition, upon a default by an option counterparty, we may suffer adverse tax consequences and more dilution than we currently anticipate with respect to our common stock. We can provide no assurances as to the financial stability or viability of the option counterparties.

Conversion of the Notes or exercise of the warrants evidenced by the warrant transactions may dilute the ownership interest of existing stockholders.

At our election, we may settle the Notes tendered for conversion entirely or partly in shares of our common stock. Furthermore, the warrants evidenced by the warrant transactions are expected to be settled on a net-share basis. As a result, the conversion of some or all of the Notes or the exercise of some or all of such warrants may dilute the ownership interests of existing stockholders. Any sales in the public market of the common stock issuable upon such conversion of the Notes or such exercise of the warrants could adversely affect prevailing market prices of our common stock and, in turn, the price of the Notes. In addition, the existence of the Notes may encourage short selling by market participants because the conversion of the Notes could depress the price of our common stock.
21


GENERAL RISKS

Fluctuations in currency exchange rates could negatively affect our business, financial condition, and results of operations.

A significant portion of our revenue and expenses are realized in foreign currencies. As a result, changes in exchange rates will result in increases or decreases in our costs and earnings and may adversely affect our Consolidated Financial Statements, which are stated in U.S. dollars. Although we may seek to minimize currency exchange risk by engaging in hedging transactions where we deem appropriate, we cannot be assured that our efforts will be successful. Currency fluctuations may also result in our systems and services becoming more expensive and less competitive than those of other suppliers in the foreign countries in which we sell our systems and services.

Terrorist attacks and threats, escalation of military activity in response to such attacks, acts of war, or outbreak of pandemic diseases may negatively affect our business, financial condition, results of operations, and cash flows.

Any future terrorist attacks against U.S. targets, rumors or threats of war, actual conflicts involving the United States or its allies, or military or trade disruptions affecting our customers or the economy as a whole may materially adversely affect our operations or those of our customers. Strategic targets such as those relating to transportation and food processing may be at greater risk of future terrorist attacks than other targets in the United States. Our airport authority, airline, air cargo and ground handling customers are also particularly sensitive to safety concerns, and their businesses may decline after terrorist attacks or threats or during periods of political instability when travelers are concerned about safety issues. Furthermore, outbreaks of pandemic diseases, such as COVID-19, or the fear of such events, could provoke responses, including government-imposed travel restrictions and extended shutdown of certain businesses, customers, and/or supply chain disruptions in affected regions. As a result, there could be delays or losses in transportation and deliveries to our customers, decreased sales of our products, and delays in payments by our customers. A decline in these customers’ businesses could have a negative impact on their demand for our products. It is possible that any of these occurrences, or a combination of them, could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

Our existing financing agreements include restrictive and financial covenants.

Certain of our loan agreements require us to comply with various restrictive covenants and some contain financial covenants that require us to comply with specified financial ratios and tests. Our failure to meet these covenants could result in default under these loan agreements and would result in a cross-default under other loan agreements. In the event of a default and our inability to obtain a waiver of the default, all amounts outstanding under loan agreements could be declared immediately due and payable. Our failure to comply with these covenants could adversely affect our results of operations and financial condition.

Fluctuations in interest rates could adversely affect our results of operations and financial position.

Our profitability may be adversely affected during any periods of unexpected or rapid increases in interest rates on our variable rate debt.A significant increase in interest rates would significantly increase our cost of borrowings, and may reduce the availability and increase the cost of obtaining new debt and refinancing existing indebtedness. For additional detail related to this risk, see Part II, Item 7A, "Quantitative and Qualitative Disclosure About Market Risk."

Significant changes in actual investment return on pension assets, discount rates, and other factors could affect our results of operations, equity, and pension contributions in future periods.


Our results of operations may be positively or negatively affected by the amount of income or expense we record for our defined benefit pension plans. U.S. generally accepted accounting principles (GAAP) require that we calculate income or expense for the plans using actuarial valuations. These valuations reflect assumptions about financial market and other economic conditions, which may change based on changes in key economic indicators. The most significant year-end assumptions we use to estimate pension income or expense are the discount rate and the expected long-term rate of return on plans assets. In addition, we are required to make an annual measurement of plan assets and liabilities, which may result in a significant change to equity through a reduction or increase to accumulated other comprehensive income. For a discussion regarding how our financial statements can be affected by pension plan accounting policies, see Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations -Critical Accounting Estimates – Defined Benefit Pension and Other Post-retirement Plans and Note 8.9. Pension and Post-Retirement and Other Benefit Plans of the Notes to the Consolidated Financial Statements in Part II, Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K. Although GAAP expense and pension funding contributions are not directly related, key economic factors that affect GAAP expense would also likely affect the amount of cash we would contribute to pension plans as required under the Employee Retirement Income Security Act.


22

As a result of our acquisition activity, our goodwill and intangible assets have increased significantly in recent years and we may in the future incur impairments to goodwill or intangible assets.

When we acquire a business, a substantial portion of the purchase price of the acquisition is allocated to goodwill and other identifiable intangible assets. The amount of the purchase price which is allocated to goodwill is determined by the excess of the purchase price over the net identifiable assets acquired. Our balance sheet includes a significant amount of goodwill and other intangible assets, which represents approximately 48% of our total assets as of December 31, 2022. In accordance with Accounting Standards Codification 350 Intangibles-Goodwill and Other, our goodwill and other intangibles are reviewed for impairment annually and whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Our valuation methodology for assessing impairment requires management to make judgments and assumptions based on historical experience and to rely heavily on projections of future operating performance. Because we operate in highly competitive environments, projections of our future operating results and cash flows may vary significantly from our actual results. If our estimates or the underlying assumptions change in the future, we may be required to record impairment charges. Any such charge could have a material adverse effect on our reported net income.

As a publicly traded company, we incur regulatory costs that reduce profitability.


As a publicly traded corporation, we incur certain costs to comply with regulatory requirements of the NYSE and of the federal securities laws. If regulatory requirements were to become more stringent or if accounting or other controls thought to be effective later fail, we may be forced to make additional expenditures, the amounts of which could be material. Many of our competitors are privately owned, so our accounting and control costs can be a competitive disadvantage.


Our share repurchase program could increase the volatility of the price of our common stock.


On December 2, 2015,1, 2021, the Board authorized a share repurchase program for up to $30 million of our common stock beginning on January 1, 20162022 and continuing through December 31, 2018.2024. We have funded theintend to fund repurchases through cash flows generated by our operations. The amount and timing of share repurchases wasare based on a variety of factors. Important factors that could cause us to limit, suspend or delay the Company’sour stock repurchases include unfavorable market conditions, the trading price of the Company’sour common stock, the nature of other investment opportunities presented to us from time to time, the ability to obtain financing at attractive rates, and the availability of U.S. cash. Repurchases of our shares will reduce the number of outstanding shares of our common stock and might incrementally increase the potential for volatility in our common stock by reducing the potential volumes at which our common stock may trade in the public market.


Our actual operating results may differ significantly from our guidance.


We regularly release guidance regarding our future performance that represents our management’s estimates as of the date of release. This guidance, which consists of forward-looking statements, is prepared by our management and is qualified by, and subject to, the assumptions and the other information contained or referred to in the release or report in which guidance is given. Our guidance is not prepared with a view toward compliance with published guidelines of the American Institute of Certified Public Accountants, and neither our independent registered public accounting firm nor any other independent expert or outside party compiles or examines the guidance and, accordingly, no such person expresses any opinion or any other form of assurance with respect thereto.


Guidance is based upon a number of assumptions and estimates that, while presented with numerical specificity, are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control and are based upon specific assumptions with respect to future business decisions, some of which will change. We generally state possible outcomes as high and low ranges which are intended to provide a sensitivity analysis as variables are changed, but are not intended to represent that actual results could not fall outside of the suggested ranges. The principal reason that we release this data is to provide a basis for our management to discuss our business outlook with analysts and investors. We do not accept any responsibility for any projections or reports published by any such persons.


Guidance is necessarily speculative in nature, and it can be expected that some or all of the assumptions of the guidance furnished by us will not materialize or will vary significantly from actual results. Accordingly, our guidance is only an estimate of what management believes is realizable as of the date of release. Actual results willmay vary from the guidance and the variations may be material. Investors should also recognize that the reliability of any forecasted financial data diminishes the farther in the future that the data are forecast. In light of the foregoing, investors are urged to put the guidance in context and not to place undue reliance on it.

23


Our corporate governance documents our rights plan, and Delaware law may delay or discourage takeovers and business combinations that our stockholders might consider in their best interests.


Provisions in our certificate of incorporation and by-laws may make it difficult and expensive for a third-party to pursue a tender offer, change-in-control, or takeover attempt that is opposed by our management and Board of Directors. These provisions include, among others:


•A Board of Directors that is divided into three classes with staggered terms;

•Limitations on the right of stockholders to remove directors;

•The right of our Board of Directors to issue preferred stock without stockholder approval;

•The inability of our stockholders to act by written consent; and

•Rules and procedures regarding how stockholders may present proposals or nominate directors at stockholders meetings.


Public stockholders who might desire to participate in this type of transaction may not have an opportunity to do so. These anti-takeover provisions could substantially impede the ability of public stockholders to benefit from a change-in-control or a change in our management or Board of Directors and, as a result, may adversely affect the marketability and market price of our common stock.


In addition,Our indebtedness and liabilities could limit the cash flow available for our operations and we have adopted a stockholder rights plan intendedmay not be able to deter hostile or coercive attemptsgenerate sufficient cash to acquire us. Under the plan, if any person or group acquires, or begins a tender or exchange offer that could result in such person acquiring 15% or moreservice all of our common stock, without approvalindebtedness. We may be forced to take certain actions to satisfy our obligations under our indebtedness or we may experience a financial failure.

Our ability to make scheduled payments on or to refinance our debt obligations, including the Notes, will depend on our financial and operating performance. If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell assets or operations, seek additional capital or restructure or refinance our indebtedness, including the Notes. We may not be able to take any of these actions, these actions may not be successful and permit us to meet our scheduled debt service obligations and these actions may not be permitted under the terms of our Boardfuture debt agreements. In the absence of Directors under specified circumstances,sufficient operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. We may not be able to consummate those dispositions or obtain sufficient proceeds from those dispositions to meet our debt service and other obligations then due. Our current and future indebtedness could have negative consequences for our business, results of operations and financial condition by, among other things:

•    increasing our vulnerability to adverse economic and industry conditions;
•    limiting our ability to obtain additional financing;
•    requiring the dedication of a substantial portion of our cash flow from operations to service our indebtedness, which will reduce the amount of cash available for other purposes;
•    limiting our flexibility to plan for, or react to, changes in our business;
•    diluting the interests of our existing stockholders will have the right to purchaseas a result of issuing shares of our common stock or sharesupon conversion of the acquiring company,Notes; and
•    placing us at a substantial discountpossible competitive disadvantage with competitors that are less leveraged than us or have better access to the public market price. Therefore, the rights will cause substantial dilutioncapital.

In addition, our credit facility contains, and any future indebtedness that we may incur may contain, restrictive covenants that limit our ability to a personoperate our business, raise capital or groupmake payments under our other indebtedness. If we fail to comply with these covenants or to make payments under our indebtedness when due, then we would be in default under that attempts to acquire us on terms not approved by our Board of Directors, except pursuant to any offer conditioned on a substantial number of rights being acquired. Although we believe these provisions protect our stockholders from coercive or otherwise unfair takeover tactics and thereby provide for an opportunity to receive a higher bid by requiring potential acquirers to negotiate with our Board of Directors, these provisions apply even if the offer may be considered beneficial by some stockholders. The stockholders rights plan will expireindebtedness, which could, in July 2018,turn, result in that and our Board of Directors does not currently intend to replace it.other indebtedness becoming immediately payable in full.
ITEM 1B.    UNRESOLVED STAFF COMMENTS


None.



24

ITEM 2.    PROPERTIES


We lease executive officescommercial office space for our corporate headquarters totaling approximately 24,000 square feet in Chicago, Illinois. We believe that our properties and facilities meet our current operating requirements and are in good operating condition. We believe that each of our significant manufacturing facilities is operating at a level consistent with the industries in which we operate. The following are significant production facilities for our JBT operations:

LOCATIONSEGMENTSQUARE FEET
(approximate)		LEASED OR OWNED
United States:
Madera, CaliforniaFoodTech271,000Owned
Ogden, UtahAeroTech240,000Owned/Leased
Orlando, FloridaAeroTech239,000Owned
Lakeland, FloridaFoodTech200,000Owned
Sandusky, OhioFoodTech140,000Owned
Apex, North CarolinaFoodTech134,200Owned/Leased
Columbus, OhioFoodTech115,000Leased
Kingston, New YorkFoodTech98,000Owned
Warrenton, OregonAeroTech94,000Leased
Stratford, WisconsinFoodTech93,000Owned
Eastlake, OhioFoodTech88,000Leased
Middletown, OhioFoodTech74,000Leased
Chalfont, PennsylvaniaFoodTech67,000Leased
Russellville, ArkansasFoodTech65,000Owned
Riverside, CaliforniaFoodTech50,000Leased
LOCATIONInternational:SEGMENT
SQUARE FEET
(approximate)
LEASED OR OWNED
United States:
Madera, CaliforniaJBT FoodTech271,000Owned
Orlando, FloridaJBT AeroTech248,000Owned
Ogden, UtahJBT AeroTech240,000Owned/Leased
Lakeland, FloridaJBT FoodTech200,000Owned
Stratford, WisconsinJBT FoodTech160,000Owned
Sandusky, OhioJBT FoodTech140,000Owned
Kingston, New YorkJBT FoodTech133,000Owned
Chalfont, PennsylvaniaJBT FoodTech67,000Leased
Apex, North CarolinaJBT FoodTech65,000Owned
Middletown, OhioJBT FoodTech65,000Leased
Russellville, ArkansasJBT FoodTech65,000Owned
Riverside, CaliforniaJBT FoodTech50,000Leased
International:
Sint Niklaas, BelgiumJBT FoodTech289,000Owned
Helsingborg, SwedenJBT FoodTech227,000Owned/Leased
Araraquara, BrazilWerther, GermanyJBT FoodTech128,000164,000Owned
Araraquara, BrazilFoodTech128,000Owned
Adlington, EnglandFoodTech97,000Owned
Amsterdam, The NetherlandsJBT FoodTech105,00096,000Leased
Madrid, SpainLivingston, ScotlandJBT FoodTech JBT AeroTech88,00087,000Owned
Livingston, ScotlandParma, ItalyJBT FoodTech87,00062,000Owned
Kunshan, ChinaNavarra, SpainJBT FoodTech JBT AeroTech80,00058,500LeasedOwned
Parma, ItalyBridgend, WalesJBT FoodTechAeroTech72,00058,000Owned
Bridgend, WalesJBT AeroTech58,000Owned
Glinde, GermanyJBT FoodTech41,00055,000Leased
Harwich, EnglandJBT FoodTech40,000Leased
Cape Town, South AfricaJBT FoodTech38,000Leased
Juarez, MexicoJBT AeroTech27,000Leased

25


ITEM 3.    LEGAL PROCEEDINGS


We are involved in legal proceedings arising in the ordinary course of business. Although the results of litigation cannot be predicted with certainty, we do not believe that the resolution of the proceedings that we are involved in, either individually or taken as a whole, will have a material adverse effect on our business, results of operations, cash flows or financial condition.


In the normal course of our business, we are at times subject to pending and threatened legal actions, some for which the relief or damages sought may be substantial. Although we are not able to predict the outcome of such actions, after reviewing all pending and threatened actions with counsel and based on information currently available, management believes that the outcome of such actions, individually or in the aggregate, will not have a material adverse effect on the results of operations or financial position of our Company. However, it is possible that the ultimate resolution of such matters, if unfavorable, may be material to the results of operations in a particular future period as the time and amount of any resolution of such actions and its relationship to the future results of operations are not currently known.


Liabilities are established for pending legal claims only when losses associated with the claims are judged to be probable, and the loss can be reasonably estimated. In many lawsuits and arbitrations, it is not considered probable that a liability has been incurred or not possible to estimate the ultimate or minimum amount of that liability until the case is close to resolution, in which case no liability would be recognized until that time.


26

ITEM 4.    MINE SAFETY DISCLOSURES


Not applicable.

27

PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS


OurThe Company's common stock is listed on the New York Stock Exchange under the symbol JBT. As of February 26, 2018,16, 2023, there were 1,5431,226 holders of record of our common stock. Information regarding the market prices of our common stock and dividends declared for the two most recent fiscal years is provided in Note 18. Quarterly Information to our Consolidated Financial Statements.


The following graph shows the cumulative total return of an investment of $100 (and reinvestment of any dividends thereafter) on December 31, 20122017 in: (i) ourthe Company's common stock, (ii) the S&P Smallcap 600 Stock Index and (iii) the Russell 2000 Index.S&P 1500 Industrial Machinery index. These indices are included for comparative purposes only and do not necessarily reflect management’s opinion that such indices are an appropriate measure of the relative performance of the stock involved, and are not intended to forecast or be indicative of possible future performance of the common stock.



jbt-20221231_g2.gif







28

Issuer purchases of Equity Securities
The following table includes information about the Company’s stock repurchases during the three months ended December 31, 2017:2022 based on the settlement dates of each share repurchase:

(Dollars in millions, except per share amounts)
PeriodTotal Number of Shares PurchasedAverage Price Paid per Share
Total Number of Shares Purchased as part of Publicly Announced Program(1)
Approximate Dollar Value of Shares that may yet be Purchased under the Program
October 1, 2022 through October 31, 2022— $— — $27.3 
November 1, 2022 through November 30, 202253,543 90.87 53,543 22.4 
December 1, 2022 through December 31, 20221,523 88.95 1,523 22.3 
55,066 $90.87 55,066 $22.3 

(1)Shares that may be repurchased under a share repurchase program for up to $30 million of common stock that was authorized by the Board of Directors on December 1, 2021 and is set to expire on December 31, 2024. Shares may be purchased from time to time in open market transactions, subject to market conditions. Repurchased shares become treasury shares, which are accounted for using the cost method and are intended to be used for future awards under the Incentive Compensation Plan.

29
(Dollars in millions, except per share amounts)         
Period Total Number of Shares Purchased Average Price Paid per Share 
Total Number of Shares Purchased as part of Publicly Announced Program(1)
 Approximate Dollar Value of Shares that may yet be Purchased under the Program 
October 1, 2017 through October 31, 2017 —
 $—
 —
 $20.7
 
November 1, 2017 through November 30, 2017 —
 —
 —
 20.7
 
December 1, 2017 through December 31, 2017 —
 —
 —
 20.7
 
  —
 $—
 —
 $20.7
 


(1)On December 2, 2015, the Board authorized a share repurchase program for up to $30 million of our common stock beginning on January 1, 2016 and continuing through December 31, 2018.

ITEM 6.    SELECTED FINANCIAL DATA[RESERVED]


The following table presents selected financial and other data about us for the most recent five fiscal years. The data has been derived from our Consolidated Financial Statements. The historical Consolidated Balance Sheet data set forth below reflects the assets and liabilities that existed as of the dates presented.

The selected financial data should be read in conjunction with, and are qualified by reference to, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. The income statement and cash flow data for the three years ended December 31, 2017, 2016 and 2015 and the balance sheet data as of December 31, 2017 and 2016 are derived from our audited Consolidated Financial Statements included elsewhere in this report, and should be read in conjunction with those financial statements and the accompanying notes. The balance sheet data as of December 31, 2015, 2014, 2013 and the income statement and cash flow data for the years ended December 31, 2014 and 2013 were derived from audited financial statements that are not presented in this report.

The following financial information may not reflect what our results of operations, financial position and cash flows will be in the future. In addition, Item 1A. Risk Factors of this report includes a discussion of risk factors that could impact our future results of operations.



30
 Year Ended December 31, 
(In millions, except per share data)2017 2016 2015 2014 2013 
Income Statement Data:          
Revenue:          
JBT FoodTech$1,171.9
 $928.0
 $725.1
 $634.7
 $611.1
 
JBT AeroTech463.0
 422.5
 383.1
 350.2
 323.6
 
Other revenue and intercompany eliminations0.2
 —
 (0.9) (0.7) (0.5) 
Total revenue$1,635.1
 $1,350.5
 $1,107.3
 $984.2
 $934.2
 
Operating expenses:          
Cost of sales$1,164.4
 $969.8
 $790.4
 $719.5
 $699.0
 
Selling, general and administrative expense294.4
 236.7
 207.0
 183.3
 166.6
 
Research and development expense28.7
 23.6
 18.2
 14.6
 14.0
 
Restructuring expense1.7
 12.3
 —
 14.5
 1.6
 
Other (income) expense, net0.1
 4.7
 2.7
 1.6
 (0.2) 
Operating income145.8
 103.4
 89.0
 50.7
 53.2
 
Interest income0.7
 1.6
 1.1
 1.6
 2.2
 
Interest expense14.3
 11.0
 7.9
 7.6
 7.6
 
Income from continuing operations before income taxes132.2
 94.0
 82.2
 44.7
 47.8
 
Provision for income taxes50.1
 26.0
 26.2
 13.9
 13.8
 
Income from continuing operations82.1
 68.0
 56.0
 30.8
 34.0
 
Loss from discontinued operations, net of income taxes1.6
 0.4
 0.1
 —
 0.9
 
Net income$80.5
 $67.6
 $55.9
 $30.8
 $33.1
 
           
Diluted earnings per share:          
Income from continuing operations$2.58
 $2.28
 $1.88
 $1.03
 $1.15
 
Net income$2.53
 $2.27
 $1.88
 $1.03
 $1.11
 
Diluted weighted average shares outstanding31.9
 29.8
 29.8
 29.9
 29.7
 
           
Cash dividends declared per common share$0.40
 $0.40
 $0.37
 $0.36
 $0.34
 
           
Common Stock Data:          
Common stock sales price range:          
High$120.55
 $93.55
 $51.34
 $33.99
 $30.00
 
Low$80.70
 $41.35
 $29.69
 $25.52
 $17.78
 


 At December 31, 
(In millions)2017
2016
2015
2014
2013 
Balance Sheet Data:          
Total assets$1,391.4
 $1,187.4
 $876.1
 $697.8
 $621.2
 
Long-term debt, less current portion372.7
 491.6
 280.6
 173.8
 94.1
 

 Year Ended December 31, 
(In millions)2017 2016 2015 2014 2013 
Other Financial Information:          
Capital expenditures$37.9
 $37.1
 $37.7
 $36.7
 $29.2
 
Cash flows provided by continuing operating activities106.3
 67.9
 112.2
 78.0
 63.1
 
Order backlog (unaudited)625.2
 557.0
 520.7
 366.7
 376.5
 

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Executive Overview


We are a leading global technology solutions provider to high-value segments of the food and beverage industry with focus on proteins, liquid foodsindustry. We design, produce, and automated system solutions. JBT designs, produces and servicesservice sophisticated products and systems for multi-national and regional customers through itsour FoodTech segment. JBTWe also sellssell critical equipment and services to domestic and international air transportation customers through itsour AeroTech segment.


In 2017early 2022, we began to implementannounced our Elevate plan2.0 strategy that was developed in 2016 to capitalizecapitalizes on thefavorable trends, as well as our leadership position, of our businessesin the food and favorable macroecomonic trends. The Elevate planbeverage processing industry. This strategy is based on a four-pronged approach to deliver continued growth and margin expansion.


Accelerate New Product•Organic Growth. Our broad application knowledge, engineering expertise, and global sales and service allow us to work alongside our customers to develop critical FoodTech products and solutions across a diverse set of food & Service Development.beverage end markets. JBT is acceleratingoperating in commercial markets which we believe over the developmentlong term create meaningful opportunities for continued new product innovation and R&D in support of innovative productsour customers’ needs. Additionally, our cross-selling abilities, investment opportunities in developing geographies, and servicesaftermarket capabilities provide meaningful growth opportunities for FoodTech globally.

•Digital Transformation. We are investing to provideevolve our iOPS® platform into a new digital solution called OmniBlu™, a customer-centric platform that delivers improved access to parts and service, advanced functionality, and measurable results for customers, with solutions that enhance yield and productivity and reduce lifetime cost of ownership.

Grow Recurring Revenue. JBT is capitalizing on its extensive installed base to expandwhile also expanding JBT's recurring revenue from aftermarket parts and services, equipment leases, consumables and airport services.


Execute Impact Initiatives. JBT is enhancing organic growth•Margin Enhancement. We see opportunities to improve our operating margins by 200 basis points or more in the medium-term, primarily through initiatives that enable us to sell the entire FoodTech portfolio globally, including enhancing our international sales and support infrastructure, localizing targeted products for emerging markets,supply chain and strategic cross sellingsourcing initiatives. Key areas of Proteinfocus include supply base consolidation, make versus buy decisions, value engineering and Liquid Foods products. Additionally, our impact initiatives are designed to support the reduction in operatingcomponent standardization, and best cost including strategic sourcing, relentless continuous improvement (lean) efforts, and the optimization of organization structure. In AeroTech, we plan to continue to develop advanced military product offering and customer support capability to service global military customers.
country sourcing.


Maintain Disciplined Acquisition Program. •Acquisitions.We are also continuing our strategic acquisition program focused on companies that add complementary products and technology solutions, which enable us to offer more comprehensive solutions to customers and meet our strict economic criteria for returns and synergies.


AsIn pursuit of the above strategy, we evaluateare considering a full range of strategic alternatives for AeroTech and expect to complete our operating results, we consider our key performance indicatorsstrategic assessment in the first half of segment revenue, segment operating profit,2023.

We operate under the JBT Business System, which provides a level of inbound ordersprocess rigor across the Company and order backlog.is designed to standardize and streamline reporting and problem resolution processes for increased visibility, efficiency, effectiveness and productivity in all business units.


We continue to enhance our comprehensiveOur approach to Environmental, Social and Corporate Social Responsibility (CSR), buildingGovernance (ESG) builds on our culture and long tradition of concern for our employees’ health, safety, and well-being; partnering with our customers to improve their operations;find ways to make better use of the earth’s precious resources; and giving back to the communities where we live and work. Our FoodTech equipment and technologytechnologies continue to deliver quality performance while striving to minimize food waste, extend food product life, and maximize efficiency in order to create shared value for both our food processing and beverage customers. Our AeroTech equipment business offers a variety of power options, including electrically powered ground support equipment, that help customers meet their environmental objectives. While the majority of our impact lies within the solutions offered to our customers, our commitment to environmental responsibility extends to our own operations. We strive for our own facilities to operate efficiently and air transportationsafely, much like the solutions we provide to our customers. A key CSR objectiveWe recognize the responsibility we have to make a positive impact on our shareholders, the environment and our communities in a manner that is to further align our businessconsistent with our fiduciary duties. We have engaged in structured education for enhancing inclusive leadership skills in our organization designed to ensure more diversity in our leadership and hiring practices.

We evaluate our operating results considering key performance indicators including segment operating profit, segment operating profit margin, segment EBITDA (adjusted when appropriate) and segment EBITDA margins.
31

Business Conditions and Outlook

In terms of top–line growth, the commercial environment in 2022 was characterized by strong demand for our goods and services, particularly in North America. Higher demand in FoodTech is driven primarily by our customer's needs for greater capacity, labor savings, yield, food safety and sustainability. On the AeroTech side, we continued to experience a strong recovery in our served markets. Looking ahead, we anticipate continued revenue growth in 2023 due to sustained momentum in overall customer demand for our products and services, a strong backlog entering into 2023 and a mix of recurring revenue streams consistent with prior years.

Despite significant growth in our revenues, our operating margins declined due to the challenges associated with supply chain disruptions, high inflation, and labor availability affecting both FoodTech and AeroTech. While our JBT operating system enables us to plan and optimize production efficiency, continued supply chain disruptions and labor shortages has often resulted in the stop and start of production based on availability of critical parts and components. However, we expect an improvement in our supply chain performance and for inflation to moderate as we continue to take action to address these challenges. These include making productivity improvements in our production plants, expanding our supplier network, and implementing price increases which have generally been successful in offsetting some, but not all, of the impact of these challenges.

As a result of the war in Ukraine, we have suspended commercial activities in Russia, Belarus and occupied regions of Ukraine since March 2022. This consisted of ceasing our efforts to seek new business opportunities in these areas, as well as suspending any in-process projects to allow for an assessment of our ability to complete those projects and to receive payments in full compliance with applicable sanction programs, and without risk to our personnel and subcontractors. The direct impact of these actions to our consolidated results of operations is and is expected to remain immaterial. Furthermore, we have no direct active operations in any of these countries or regions.

32

Results of Continuing Operations

A discussion of our results of operations for 2022 compared to 2021 is set forth below. For a discussion of our results of operations, including our segment results of operations, for 2021 compared to 2020, refer to the discussion under the sub-caption "2021 Compared With 2020" in Item 7 – Management's Discussion and Analysis of Financial Condition and Results of Operations in Part II of our Annual Report on Form 10–K for the fiscal year ended December 31, 2021, which discussion is incorporated by reference herein.

CONSOLIDATED RESULTS OF OPERATIONS
Year Ended December 31,Favorable / (Unfavorable)
(In millions)20222021ChangeChange %
Revenue$2,166.0 $1,868.3 $297.7 15.9%
Cost of sales1,548.7 1,301.5 (247.2)(19.0)%
Gross profit617.3 566.8 50.5 8.9%
Gross Profit %28.5%30.3%-180 bps
Selling, general and administrative expense441.9 401.1 (40.8)(10.2)%
Restructuring expense7.0 5.6 (1.4)(25.0)%
Operating income168.4 160.1 8.3 5.2%
Operating income %7.8%8.6%-80 bps
Pension (income) expense, other than service cost— (1.3)(1.3)100.0%
Interest expense, net14.2 8.7 (5.5)(63.2)%
Net income before income taxes154.2 152.7 1.5 1.0%
Income tax provision23.5 34.3 10.8 31.5%
Net income$130.7 $118.4 $12.3 10.4%

2022 Compared With 2021

Total revenue in 2022 increased $297.7 million or 15.9% compared to 2021. Organic revenue grew $282.0 million in the period, acquisitions provided additional revenue of $93.5 million, and foreign currency translation was unfavorable by $77.8 million in the period compared to the prior year. Growth from organic revenue was the result of increases in both recurring and non-recurring revenues.

Operating income margin was 7.8% in 2022 compared to 8.6% in 2021, a decrease of 80 bps, and was caused by the following items:

•Gross profit margin decreased 180 bps to 28.5% compared to 30.3% in 2021. This decrease was in part due to ongoing supply chain disruptions and resulting inefficiencies driving increases in material, logistics and labor costs. Additionally, gross profit margin declined due to more growth in lower-margin AeroTech revenue compared to FoodTech revenue, as well as a higher mix in both segments of lower-margin non-recurring revenue compared to recurring revenue.
•Selling, general and administrative expense increased $40.8 million from prior year driven by higher costs attributable to recently acquired businesses as well as costs related to the implementation of OmniBluTM. It improved, however, as a percentage of total revenue by 110 bps to 20.4% compared to 21.5% in the same period last year.
•Currency translation decreased operating income by $9.6 million.

Increase in net interest expense was primarily due to higher interest rates as well as a higher average debt balance to fund the acquisitions in the third quarter of 2022.

Income tax expense for 2022 reflected an effective income tax rate of 15.3% compared to 22.4% in 2021, primarily driven by beneficial discrete items.
33

Restructuring

In the third quarter of 2020, the Company implemented a restructuring plan ("2020 restructuring plan") for manufacturing capacity rationalization affecting both the FoodTech and AeroTech segments. The Company completed the 2020 restructuring plan as of June 30, 2022. The total cost in connection with the 2020 restructuring plan was $11.0 million for FoodTech and $6.0 million for AeroTech.

In the third quarter of 2022, the Company implemented a restructuring plan (the "2022/2023 restructuring plan") to optimize the overall FoodTech cost structure on a global basis. The initiatives under this plan will include streamlining operations and our general and administrative infrastructure. As of December 31, 2022, the cost of this plan is $5.4 million and we estimate the total cost of full implementation will be in the range of $8.0 million to $10.0 million expected to be recognized by the end of 2023. Cumulative savings associated with this plan is in the range of $9.0 million to $12.0 million with a range of $5.0 million to $6.0 million expected to be realized in 2023 and the remainder in 2024.

The following table details the cumulative amount of annualized and incremental savings for the 2020 restructuring plan:
Cumulative AmountIncremental AmountCumulative Amount
(In millions)As of
December 31, 2021		During the year ended December 31, 2022As of December 31, 2022
Cost of sales$5.0 $1.4 $6.4 
Selling, general and administrative1.9 0.8 2.7 
Total restructuring savings$6.9 $2.2 $9.1 

For the 2020 restructuring plan, incremental cost savings has been completed as of June 30, 2022.

For additional financial information about restructuring, refer to Note 20. Restructuring of the Notes to Consolidated Financial Statements.


34

OPERATING RESULTS OF BUSINESS SEGMENTS

Year Ended December 31,Favorable / (Unfavorable)
(In millions)20222021ChangeChange %
Revenue
FoodTech$1,590.6 $1,400.4 $190.2 13.6%
AeroTech575.7 467.5 108.2 23.1%
Other revenue and intercompany eliminations(0.3)0.4 (0.7)(175.0)%
Total revenue$2,166.0 $1,868.3 $297.7 15.9%
Income before income taxes
Segment operating profit(1)(2):
FoodTech$211.5 $187.0 $24.5 13.1%
FoodTech segment operating profit %13.3%13.4%-10 bps
AeroTech43.5 32.6 10.9 33.4%
AeroTech segment operating profit %7.6%7.0%60 bps
Total segment operating profit255.0 219.6 35.4 16.1%
Total segment operating profit %11.8%11.8%0 bps
Corporate items:
Corporate expense79.6 53.9 (25.7)(47.7)%
Restructuring expense7.0 5.6 (1.4)(25.0)%
Operating income168.4 160.1 8.3 5.2%
Operating income %7.8%8.6%-80 bps
Pension (income) expense, other than service cost— (1.3)(1.3)100.0%
Interest expense, net14.2 8.7 (5.5)(63.2)%
Net income before income taxes154.2 152.7 1.5 1.0%
Income tax provision23.5 34.3 10.8 31.5%
Net income$130.7 $118.4 $12.3 10.4%

(1)Refer to Note 19. Business Segments of the Notes to Consolidated Financial Statements.

(2)Segment operating profit is defined as total segment revenue less segment operating expense. Corporate expense, restructuring expense, interest income and expense and income taxes are not allocated to the segments. Corporate expense generally includes corporate staff-related expense, stock-based compensation, LIFO adjustments, certain foreign currency-related gains and losses, and the impact of unusual or strategic events not representative of segment operations.

FoodTech

2022 Compared With 2021

FoodTech revenue increased by $190.2 million or 13.6% for the year ended December 31, 2022 compared to 2021. Organic revenue grew $171.8 million in the period, revenue from acquisitions grew $93.5 million. Foreign currency translation was unfavorable by $75.0 million in the period. Non-recurring revenue represented 54% of the organic revenue growth, with $92.2 million of additional revenue in the year compared to 2021. Recurring revenue drove the remaining increase in organic revenue of $79.6 million.

FoodTech operating profit increased $24.5 million, net of an unfavorable foreign currency translation of $9.7 million during the period, or 13.1%, for the year ended December 31, 2022 compared to 2021. Operating profit margin declined 10 bps primarily due to a decline in gross profit margin partially offset by an improved selling general and administrative expense as a percent of revenue compared to 2021. Gross profit margins declined ~110 bps primarily due to the continued supply chain disruptions and pressures resulting in inefficiencies that drove ongoing increases in material, freight, and labor costs as well as due to a higher mix of organic revenue growth from lower-margin non-recurring revenue compared to recurring revenue. Selling, general and administrative expense increased $22.3 million from prior year, including $15.9 million from acquired companies, but as a percent of revenue improved 115 bps to 20.1%.
35


AeroTech

2022 Compared With 2021

AeroTech's revenue increased $108.2 million or 23.1% compared to 2021. This increase is comprised of a $74.0 million increase from our mobile equipment business, a $15.1 million increase in our fixed equipment business and a $22.0 million increase in our service business. Foreign currency translation was unfavorable by $2.9 million. The increase in our mobile equipment business was driven by higher equipment sales to cargo and other customers and higher aftermarket sales primarily as a result of the continued industry recovery from COVID-19. The increase in orderour fixed equipment business was primarily due to support their ambitious quality, financial,higher demand for passenger boarding bridges and CSR goals.related equipment from domestic customers. The increase in service revenue was a result of an increase in service hours on our maintenance contracts and project related revenues as activity at US airports continued to increase as a result of the elimination of customer-imposed service hour reductions relating to COVID-19 compared to the prior year.



AeroTech’s operating profit increased $10.9 million or 33.4% compared to 2021. AeroTech’s operating profit margin was 7.6% compared to 7.0% in the prior year, reflecting an increase of 60 bps. Gross profit margins decreased 140 bps driven by higher material, labor and freight costs. Selling, general and administrative expenses in 2022 were $0.8 million above 2021 which is an increase of 1.5%, but 200 bps below the prior year as a percent of sales. Currency translation had an immaterial impact.

Corporate Expense

2022 Compared With 2021

Corporate expense increased by $25.7 million compared to 2021. The increase was driven primarily by costs related to the development of OmniBluTM, additional LIFO expense resulting from the inflationary environment, and higher incentive compensation expense.

Use of Non-GAAP Financial Measures


The results for the periods ended December 31, 2017, 2016 and 2015 include several items that affect the comparability of our results. These include significant expenses that are not indicative of our ongoing operations as detailedWe present certain financial information on a constant currency basis in the table below:

 Year Ended December 31, 
(In millions)2017 2016 2015 
Income from continuing operations as reported$82.1
 $68.0
 $56.0
 
       
Non-GAAP adjustments      
Restructuring expense1.7
 12.3
 —
 
Impact on tax provision from restructuring expense(1)
(0.5) (3.9) —
 
Impact on tax provision from mandatory repatriation tax7.7
 —
 —
 
Impact on tax provision from tax law changes to deferred taxes7.8
 —
 —
 
Adjusted income from continuing operations$98.8
 $76.4
 $56.0
 
       
(In millions, except per share data)      
Income from continuing operations as reported$82.1
 $68.0
 $56.0
 
Total shares and dilutive securities31.9
 29.8
 29.8
 
Diluted earnings per share from continuing operations$2.58
 $2.28
 $1.88
 
       
Adjusted income from continuing operations98.8
 76.4
 56.0
 
Total shares and dilutive securities31.9
 29.8
 29.8
 
Adjusted diluted earnings per share from continuing operations$3.10
 $2.56
 $1.88
 

(1)    Impactthis annual report on tax provision was calculated using the actual rate for the relevant jurisdiction for the years ended December 31, 2017, 2016 and 2015.

The above table contains adjusted income from continuing operations and adjusted diluted earnings per share from continuing operations, which are non-GAAP financial measures, and are intendedForm 10-K to provide an indication ofgreater transparency into our underlying ongoing operating results and to enhance investors’ overall understanding of our financial performance by eliminating the effects of certain items that are not comparable from one period to the next. In addition, this information is used astrends, and a basis for evaluating our performance and for the planning and forecasting of future periods.

The table below provides a reconciliation of net income to EBITDA to Adjusted EBITDA:

 Year Ended December 31,
(In millions)2017 2016
Net income$80.5
 $67.6
Loss from discontinued operations, net of taxes1.6
 0.4
Income from continuing operations as reported82.1
 68.0
Provision for income taxes50.1
 26.0
Net interest expense13.6
 9.4
Depreciation and amortization51.7
 38.5
EBITDA197.5
 141.9
    
Restructuring expense1.7
 12.3
Adjusted EBITDA$199.2
 $154.2

The above table provides net income as adjusted by income taxes, net interest expense and depreciation and amortization expense recorded during the period to arrive at EBITDA. Further, we add back to EBITDA significant expenses that are not indicative of our

ongoing operations to calculate an Adjusted EBITDA for the periods reported. Given our focus on growth through strategic acquisitions, management considers Adjusted EBITDA to be an important non-GAAP financial measure. This measure allows us to monitor business performance while excluding the impact of amortization of intangible assets, and the depreciation of fixed assets. We use Adjusted EBITDA internally to make operating decisions and believe this information is helpful to investors because it allows more meaningful period-to-period comparisonscomparison of our ongoing operating results.

results, consistent with how management evaluates performance. We evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation is a non-GAAP financial measure, which excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our financial results in local currency for a period using the average exchange rate for the prior period to which we are comparing. This calculation may differ from similarly-titled measures used by other companies.


The non-GAAP financial measures disclosed in this Annual Report on Form 10-K are not intended to nor should they be considered in isolation or as a substitute for financial measures prepared in accordance with U.S. GAAP.


CONSOLIDATED RESULTS OF OPERATIONS

 Year Ended December 31, Favorable / (Unfavorable) 
(in millions)2017 2016 2015 
2017
vs.
2016
 
2016
vs.
2015
 
Revenue$1,635.1
 $1,350.5
 $1,107.3
 $284.6
 $243.2
 
Cost of sales1,164.4
 969.8
 790.4
 (194.6) (179.4) 
Gross profit470.7
 380.7
 316.9
 90.0
 63.8
 
Gross profit %28.8% 28.2% 28.6% 60 bps
 -40 bps
 
Selling, general and administrative expense294.4
 236.7
 207.0
 (57.7) (29.7) 
Research and development expense28.7
 23.6
 18.2
 (5.1) (5.4) 
Restructuring expense1.7
 12.3
 —
 10.6
 (12.3) 
Other expense, net0.1
 4.7
 2.7
 4.6
 (2.0) 
Operating income145.8
 103.4
 89.0
 42.4
 14.4
 
Operating income %8.9% 7.7% 8.0% 120 bps
 -30 bps
 
Interest expense, net13.6
 9.4
 6.8
 (4.2) (2.6) 
Income from continuing operations before income taxes132.2
 94.0
 82.2
 38.2
 11.8
 
Provision for income taxes50.1
 26.0
 26.2
 (24.1) 0.2
 
Income from continuing operations82.1
 68.0
 56.0
 14.1
 12.0
 
Loss from discontinued operations, net of income taxes1.6
 0.4
 0.1
 (1.2) (0.3) 
Net income$80.5
 $67.6
 $55.9
 $12.9
 $11.7
 

2017 Compared With 2016

Total revenue increased $284.6 million, or $272.8 million in constant currency, in 2017 compared to 2016. The increase was driven by revenue from acquired companies, which added $175.0 million, organic growth of $97.8 million and $11.7 million due to currency translation.

Operating income margin was 8.9% in 2017 compared to 7.7% in the same period in 2016, an increase of 120 bps, as a result of the following items:

Gross profit margin increased 60 bps to 28.8% compared to 28.2% in the same period last year. This increase was primarily the result of acquisitions.
Selling, general and administrative (SG&A) increased both in dollars and as a percentage of revenue. These increases are a result of higher relative SG&A expenses from recently acquired companies, including higher amortization costs of acquired

intangible assets in 2017 compared to 2016. Additionally, FoodTech, which carries a higher SG&A expense rate than AeroTech represented a larger mix of JBT revenue at 72% compared to 69% in 2016.
Research and development expense increased by $5.1 million as we continue to invest in Elevate new product development initiatives. As a percent of revenues, these expenses have increased slightly to 1.8% in 2017 compared to 1.7% in the same period last year as we continue to support Elevate growth initiatives.
Restructuring expense decreased $10.6 million. In the prior year we recorded restructuring expense of $12.3 million in connection with our plan to realign portions of the FoodTech business, accelerate sourcing initiatives and consolidate smaller facilities.
Other expense, net, decreased by $4.6 million, primarily due to foreign currency gains, gains on disposals of assets, and lower acquisition costs in the year.

Net interest expense increased by $4.2 million as a result of higher average debt balances incurred to acquire new businesses and increased interest rates.

Income tax expense for 2017 reflects an effective income tax rate of 37.9% compared to 27.6% in 2016. We recognized $15.5 million, or 11.7%, in income tax provision resulting from the enactment of the Tax Act in December 2017. See Tax Cuts and Jobs Act section below for further detail. The rate in 2017 also includes a $6.4 million favorable impact, or 4.8%, resulting from the adoption of new stock-based compensation guidance in 2017 requiring excess tax benefits to be recorded directly in earnings. The remaining unfavorable impact on our rate in 2017 reflects an increase in the mix of U.S. taxable income to our global earnings.

2016 Compared With 2015

Total revenue increased $243.2 million, or $250.4 million in constant currency, in 2016 compared to 2015. The increase was largely driven by revenue from acquisitions of $143.3 million. Organic growth of $107.1 million was also substantial with both FoodTech and AeroTech contributing organic growth rates of 10%, a reflection of higher demand for equipment and services across our businesses, success in accessing new sales opportunities with the integration of acquired businesses, and strategic value selling. Operating income increased $14.4 million, or $16.5 million in constant currency, in 2016 compared to 2015. Factors impacting operating income include:

Gross profit increased $63.8 million, or $67.3 million in constant currency, but declined as a percentage of revenue from 28.6% to 28.2%. The decrease in profit margins reflect lower gross profit margins contributed from businesses acquired in 2015 and 2016 which was somewhat offset by higher margins from strategic value selling.
Selling, general and administrative (SG&A) expenses increased by $29.7 million, or $33.0 million in constant currency, but declined as a percentage of revenue from 18.7% to 17.5%. The increase was primarily a result of higher corporate expenses of $8.0 million including costs incurred in preparation for the implementation of a new global ERP system, and investments in Next Level initiatives including global sourcing initiatives and continuous improvement projects. In addition, we incurred $8.6 million in incremental SG&A from businesses acquired during 2015 and 2016.
Research and development expense increased by $5.4 million from new product development primarily in newly acquired businesses, higher spend on new technology and product upgrades.
Restructuring expense increased $12.3 million. We initiated an optimization program in early 2016 designed to realign certain FoodTech businesses.
Other expense, net, increased by $2.0 million, primarily due to higher acquisition costs incurred on acquisitions pursued or completed in 2016.

Net interest expense increased by $2.6 million as a result of higher average debt balances incurred to acquire new businesses.

Income tax expense for 2016 reflects an income tax rate of 27.6% compared to 31.9% in 2015. The decrease was driven by an increase in the R&D tax credit in 2016 compared to 2015. In addition, in 2016 we recorded $1.5 million of favorable discrete adjustments to the income tax provision, primarily reflecting a lower tax liability for fiscal year 2015.

Restructuring

In the first quarter of 2016, we implemented our optimization program to realign FoodTech’s Protein business in North America and Liquid Foods business in Europe, accelerate JBT’s strategic sourcing initiatives, and consolidate smaller facilities. The total estimated cost in connection with this plan is approximately $12.0 million.

During the fourth quarter of 2016, in connection with our acquisition of Tipper Tie, we implemented a restructuring plan to consolidate certain facilities and optimize our general and administrative infrastructure subsequent to a FoodTech acquisition. The total estimated cost in connection with this plan is approximately $4.0 million.


The following table shows the cumulative cost savings (annualized) to date from inception of the plans through December 31, 2017, and expected through the duration of the plans:

(In millions) Cumulative to Date 2018
Cost of Sales $1.8
 $0.5
Selling, General and Administrative Expense 5.3
 0.6
Total $7.1
 $1.1

The amount and timing of these cost savings were generally consistent with our expectations. A portion of the $7 million in savings was used to fund our JBT Elevate growth initiatives.

Tax Cuts and Job Act

Our effective tax rate was 37.9% compared to 27.6% in 2016. The higher rate in 2017 includes a $15.5 million unfavorable impact, or 11.7%, resulting from the enactment of the Tax Cuts and Jobs Act on December 22, 2017. Various provisions of the Tax Act have an impact on the 2017 results. We recorded a $7.0 million tax provision by remeasuring our U.S. net deferred tax assets to the new lower U.S. corporate tax rate. Additionally, we recorded a provisional $7.7 million one-time tax expense related to the deemed repatriation of foreign unremitted earnings and a provisional $0.8 million one-time tax expense related to executive compensation.

OPERATING RESULTS OF BUSINESS SEGMENTS

 Year Ended December 31, Favorable / (Unfavorable) 
(in millions)2017 2016 2015 2017
vs.
2016		 2016
vs.
2015		 
Revenue          
JBT FoodTech$1,171.9
 $928.0
 $725.1
 $243.9
 $202.9
 
JBT AeroTech463.0
 422.5
 383.1
 40.5
 39.4
 
Other revenue and intercompany eliminations0.2
 —
 (0.9) 0.2
 0.9
 
Total revenue$1,635.1
 $1,350.5
 $1,107.3
 $284.6
 $243.2
 
Income before income taxes          
Segment operating profit:          
JBT FoodTech$139.1
 $113.2
 $85.4
 $25.9
 $27.8
 
JBT FoodTech segment operating profit %11.9% 12.2% 11.8% -30 bps
 40 bps
 
JBT AeroTech50.7
 45.1
 38.2
 5.6
 6.9
 
JBT AeroTech segment operating profit %11.0% 10.7% 10.0% 30 bps
 70 bps
 
Total segment operating profit189.8
 158.3
 123.6
 31.5
 34.7
 
Total segment operating profit %11.6% 11.7% 11.2% -10 bps
 60 bps
 
Corporate items:          
Corporate expense42.3
 42.6
 34.6
 0.3
 (8.0) 
Restructuring expense1.7
 12.3
 —
 10.6
 (12.3) 
Net interest expense13.6
 9.4
 6.8
 (4.2) (2.6) 
Total corporate items57.6
 64.3
 41.4
 6.7
 (22.9) 
Income from continuing operations before income taxes132.2
 94.0
 82.2
 38.2
 11.8
 
Provision for income taxes50.1
 26.0
 26.2
 (24.1) 0.2
 
Income from continuing operations82.1
 68.0
 56.0
 14.1
 12.0
 
Loss from discontinued operations, net of income taxes1.6
 0.4
 0.1
 (1.2) (0.3) 
Net income$80.5
 $67.6
 $55.9
 $12.9
 $11.7
 

Segment operating profit is defined as total segment revenue less segment operating expenses. The following items have been excluded in computing segment operating profit: corporate staff expense, stock-based compensation, LIFO provisions, restructuring costs, certain employee benefit expenses, interest income and expense and income taxes.

JBT FoodTech

2017 Compared With 2016

JBT FoodTech’s revenue increased by $243.9 million, or $232.4 million in constant currency, in 2017 compared to 2016. North American customers drove the majority of this growth, with the remaining growth primarily driven by customers in Europe. Acquisitions contributed $166.6 million in revenue, and the remaining FoodTech business contributed $77.3 million in revenue growth, $11.6 million of which was from foreign currency translation.

JBT FoodTech's operating profit margin for the year ended December 31, 2017 was 11.9% compared to 12.2% in prior year, a decrease of 30 bps. Gross profit margins increased 20 bps year-over-year driven by acquisitions. This was more than offset by higher selling, general and administrative costs primarily attributable to recently acquired businesses and higher amortization costs in 2017 compared to 2016.

Currency translation did not have a significant impact on our operating profit comparative results for FoodTech.


2016 Compared With 2015

JBT FoodTech’s revenue increased by $202.9 million, or $210.4 million in constant currency, in 2016 compared to 2015. Acquisitions contributed $143.3 million in revenue, and the remaining FoodTech business contributed $67.1 million in revenue growth, which was partially offset by $7.5 million of foreign currency translation. The key driver of organic revenue performance was higher Protein equipment and aftermarket sales and higher Liquid Foods equipment sales across all regions.

JBT FoodTech's operating profit increased by $27.8 million, or $29.2 million in constant currency, in 2016 compared to 2015. The increase was driven by higher volume, acquisitions and increased profitability. Strategic value selling, sourcing savings, and other cost reduction initiatives helped drive operating profit improvement, partially offset by increased selling, general and administrative costs of $20.0 million from acquisitions and Next Level initiatives. Operating profit margin increased from 11.8% to 12.2%.

JBT AeroTech

2017 Compared With 2016

JBT AeroTech's revenue increased $40.5 million, or $40.4 million in constant currency, in 2017 compared to 2016. Acquisitions contributed $8.4 million, $32.0 million was from organic growth and $0.1 million in currency translation. Revenues from our fixed equipment business increased $16.5 million mainly due to higher shipments of passenger boarding bridges to domestic airports. Service revenues increased by $17.8 million driven by higher revenues from new maintenance contracts. Our organic mobile equipment revenue declined $2.3 million resulting mainly from decreased sales to military customers.
JBT AeroTech's operating profit margin was 11.0% compared to 10.7% in the prior year, reflecting an increase of 30 bps. Gross profit margins increased by 30 bps driven primarily by our value based selling and material sourcing savings Elevate initiatives. In addition, SG&A as a percent of sales decreased due to improved leveraging of fixed costs. These improvements were partially offset by higher operating expenses in 2017 driven by investment in research and development to support Elevate growth initiatives and acquisition related items.

Currency translation did not have a significant impact on our operating profit comparative results for AeroTech.

2016 Compared With 2015

JBT AeroTech's revenue increased $39.4 million, or $41.0 million in constant currency, in 2016 compared to 2015. Revenues from our fixed equipment business increased $15.3 million mainly due to higher deliveries of passenger boarding bridges and related equipment to domestic airports. Revenues from our mobile equipment business increased $11.6 million primarily due to higher deliveries of ground support equipment to domestic and foreign military customers and domestic ground handlers. Revenues from our airport services business improved by $14.1 million as a result of higher revenues from new and existing maintenance contracts.

JBT AeroTech's operating profit increased $6.9 million, or $7.2 million in constant currency, in 2016 compared to 2015. Higher sales volume accounted for $8.6 million of improved profit. Lower gross profit margins resulted in a decline of $1.2 million driven largely by the absence of higher than average margins on parts and services to military customers in the prior period and a lower mix of higher margin products partly offset by improved value selling. Selling, administrative and research and development costs were flat from the prior period.

Corporate Items

2017 Compared With 2016

Corporate items decreased by $6.7 million compared to 2016, driven primarily by a $10.6 million reduction in restructuring expense year-over-year, offset by $4.2 million higher net interest expense due to increased borrowings to fund acquisitions. Corporate expense as a percent of revenues decreased to 2.6% in 2017 compared to 3.1% in 2016, a decrease of 50 bps driven by increased leveraging of fixed costs.

2016 Compared With 2015

Corporate items increased by $22.9 million compared to 2015 driven by $12.3 million in restructuring expense incurred in 2016, $2.6 million in higher net interest expense resulting from increased borrowings, and $8.0 million in higher corporate expenses. Significant increases in corporate costs include $3.1 million in higher incentive compensation charges and $3.2 million in investments in initiatives including sourcing and continuous improvement initiatives as well as preparation for the implementation of a new global ERP system.

Inbound Orders and Order Backlog


Inbound orders represent the estimated sales value of confirmed customer orders received during the years ended December 31, 2017 and 2016.

(In millions)20222021
FoodTech$1,587.4 $1,620.1 
AeroTech595.0 552.9 
Other0.1 0.4 
Total inbound orders$2,182.5 $2,173.4 

Inbound orders for our FoodTech segment decreased $32.7 million for the year ended December 31, 2022 compared to 2021, which includes an unfavorable foreign currency translation impact of $71.4 million in the period resulting in an increase of $38.7 million on a constant currency basis.

Inbound orders for our AeroTech segment increased by $42.1 million for the year ended December 31, 2022 compared to 2021, which includes an unfavorable foreign currency translation impact of $3.3 million in the period resulting in an increase of $45.4 million on a constant currency basis.

36
(In millions)2017
2016 
JBT FoodTech$1,184.4
 $915.6
 
JBT AeroTech481.7
 442.0
 
Total inbound orders$1,666.1
 $1,357.6
 


Order backlog is calculated as the estimated sales value of unfilled, confirmed customer orders as of December 31, 2017 and 2016.

(In millions)20222021
FoodTech$664.4 $635.0 
AeroTech390.5 371.7 
Total order backlog$1,054.9 $1,006.7 
(In millions)2017 2016 
JBT FoodTech$371.2
 $325.5
 
JBT AeroTech254.0
 231.5
 
Total order backlog$625.2
 $557.0
 


Order backlog in our JBT FoodTech segment at December 31, 20172022 increased by $17.4$29.4 million compared to December 31, 2016. Excluding the effect of foreign exchange, FoodTech backlog increased by $23.1 million due to higher demand across all regions.2021. We expect to convert almost all84% of JBT FoodTech backlog at December 31, 20172022 into revenue during 2018.2023.


Order backlog in our JBT AeroTech segment at December 31, 20172022 increased by $18.9$18.8 million compared to December 31, 2016. The increase was due to $6.4 million from acquisitions and an increase in both fixed and mobile equipment orders.2021. We expect to convert approximately 70%84% of the JBT AeroTech backlog at December 31, 20172022 into revenue during 2018.2023.


Seasonality


We experience seasonality in our operating results. Historically, our revenuesrevenue and operating income have been lower in the first quarter and highest in the fourth quarter, primarily as a result of our customers' purchasing trends.

Liquidity and Capital Resources


Overview of Sources and Uses of Cash

Our primary sources of liquidity are cash flows provided by operating activities offrom our U.S. and foreign operations, and borrowings from our credit facility. Our liquidity as of December 31, 2017, or cash plus borrowing capacity under our credit facilities was $367.3 million. The cash flows generated by our operations and therevolving credit facility, are expected to be sufficient to satisfy our working capital needs, research and development activities, restructuring costs, capital expenditures, pension contributions, anticipated share repurchases, acquisitions and other financing requirements.proceeds from the issuance of the convertible notes on May 28, 2021.


As of December 31, 2017,2022, we had $34.0$73.1 million of cash and cash equivalents, $29.8$52.5 million of which was held by our foreign subsidiaries. Although thesecertain funds are considered permanently invested in our foreign subsidiaries, we are not presently aware of any restriction on the repatriation of these funds. We maintain significant operations outside of the U.S., and many of our uses of cash for working capital, capital expenditures and business acquisitions arise in these foreign jurisdictions. If these funds were needed to fund our operations or satisfy obligations in the U.S., they could be repatriated and their repatriation into the U.S. could cause us to incur additional U.S. income taxestax and foreign withholding taxes. Any additionalThe foreign withholding taxes couldon these repatriations to the U.S. would potentially be partially offset in part or in whole, by U.S. foreign tax credits. The amount of such taxes and application of tax credits would be dependent on the income tax laws and other circumstances at the time any of these amounts were repatriated.


As noted above, certain funds held outside of the U.S. are considered permanently invested in our non-U.S. subsidiaries. At times, these foreign subsidiaries have cash balances that exceed their immediate working capital or other cash needs. In these circumstances, the foreign subsidiaries may loan funds to the U.S. parent company on a temporary basis; the U.S. parent company has in the past and may in the future use the proceeds of these temporary intercompany loans to reduce outstanding borrowings under our committed credit facilities. By using available non-U.S. cash to repay our debt on a short-term basis, we can optimize our leverage ratio, which has the effect of lowering our interest costs.


Under Internal Revenue Service (IRS) guidance, no incremental tax liability is incurred onFor the proceedsyear ended December 31, 2022, we had total operating cash flow of these loans$142.3 million. Our liquidity as long as each individual loan has a term of 30 days or less and all such loans from each subsidiary are outstanding for a total of less than 60 days during the year. As of December 31, 2017 there were no amounts outstanding subject to this IRS guidance. During 2017, each such loan was outstanding for less than 30 days, and all such loans were outstanding for less than 60 days in the aggregate. We used the proceeds of these intercompany loans to reduce outstanding borrowings2022, or cash plus borrowing ability under our revolving credit facility. We may choosefacilities was $526.3 million.
The cash flows generated by our operations and borrowings are expected to access such funds again in the futurebe sufficient to the extent they are availablesatisfy our principal cash requirements that include our working capital needs, new product development, restructuring expenses, capital expenditures, income taxes, debt repayments, dividends, periodic pension contributions, and canother financing arrangements.

Based on our current capital allocation objectives, during 2023 we anticipate capital expenditures to be transferred without significant cost,between $60 million and use them on a temporary basis$70 million, which includes about $12 million to repay outstanding borrowings or for other corporate purposes, but intend to do so only as allowed under this IRS guidance.

On December 2, 2015, the Board authorized a share repurchase program for up to $30$14 million of capitalized investment in our common stock beginning January 1, 2016 and continuing through December 31, 2018. Shares may be purchaseddigital platform OmniBluTM. Our level of capital expenditures varies from time to time in open market transactions, subjectas a result of actual and anticipated business conditions. We believe JBT's strong balance sheet, operating cash flows, and access to market conditions. Repurchased shares become treasury shares, which are accounted for using the cost method and are used for future equity compensation awards. The timing, price and volume of future repurchases will be based on market conditions, relevant securities laws and other factors. Ascapital as of December 31, 2022, positions us to successfully navigate through the current challenging economic conditions as we continue to invest in growth strategies including our acquisition program and new product development.

37

Beginning in 2022, the Tax Cuts and Jobs Act of 2017 $20.7eliminated the option to deduct research and development expenditures immediately in the year incurred and requires taxpayers to amortize such expenditures in the U.S. over five years. The Company experienced approximately a $25 million was still available underdecrease in cash from operations in 2022 as a result and will experience approximately a $20 million decrease in cash from operations in 2023 The impact will continue over the program. Refer to Note 11. Stockholders' Equity for further details.five-year amortization period but decrease each year.





Contractual Obligations and Off-Balance Sheet ArrangementsCash Requirements


The following is a summary of our significant contractual and other obligations at December 31, 2017:2022:

(In millions)Total
Payments		CurrentLong-Term
Long-term debt (a)
$977.3 $— $977.3 
Interest payments on long-term debt (b)
107.7 27.4 80.3 
Operating leases (c)
48.0 12.8 35.2 
Pension and other postretirement benefits (d)
197.2 18.1 179.1 
Total contractual and other obligations$1,330.2 $58.3 $1,271.9 

 Payments due by period 
(In millions)
Total
payments
 
Less than 1
year
 
1 - 3
years
 
3-5
years
 
After 5
years
 
Long-term debt(a)
$383.5
 $10.5
 $373.0
 $—
 $—
 
Interest payments on long-term debt(b)
17.5
 8.1
 9.4
 —
 —
 
Operating leases41.4
 11.6
 13.8
 9.8
 6.2
 
Amounts due sellers from acquisitions(c)
13.8
 6.1
 7.7
 —
 —
 
Unconditional purchase obligations(d)
74.3
 74.2
 0.1
 —
 —
 
Pension and other post-retirement benefits(e)
15.3
 15.3
 —
 —
 —
 
Transition tax due under Tax Act(f)
7.7
 1.0
 1.2
 1.2
 4.3
 
Total contractual obligations$553.5
 $126.8
 $405.2
 $11.0
 $10.5
 
(a)A summary of our long-term debt obligations as of December 31, 2022 can be found in Note 7, “Debt”, of the Notes to the Consolidated Financial Statements.

(a)Our available long-term debt is dependent upon our compliance with covenants described under the heading “Financing Arrangements” later in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. Any violations of covenants or other events of default, which are not waived or cured, could have a material impact on our ability to maintain our committed financial arrangements and could accelerate our obligation to repay the amount due. We were in compliance with all debt covenants as of December 31, 2017.

(b)Interest payments were determined using the weighted average rates for all debt outstanding as of December 31, 2017.

(c)See Note 2. Acquisitions for further details on our recent acquisitions.

(d)In the normal course of business, we enter into agreements with our suppliers to purchase raw materials or services. These agreements include a requirement that our supplier provide products or services to our specifications and require us to make a firm purchase commitment to our supplier. As substantially all of these commitments are associated with purchases made to fulfill our customers’ orders, the costs associated with these agreements will ultimately be reflected in cost of sales on our consolidated statements of income.

(e)This amount reflects planned contributions in 2018 to our pension plans. Required contributions for future years depend on factors that cannot be determined at this time.

(f)This amount reflects the provisional transition tax on the previously untaxed and unrepatriated current and accumulated post-1986 foreign earnings of certain foreign subsidiaries as required by the Tax Act.



(b)Interest payments were determined using the weighted average rates for all debt outstanding as of December 31, 2022.

(c)A summary of our operating lease obligations as of December 31, 2022 can be found in Note 18, “Leases”, of the Notes to the Consolidated Financial Statements.

(d)This amount reflects planned contributions in 2023 to our pension plans. Required contributions for future years depend on factors that cannot be determined at this time.

We also have outstanding firm purchase orders with certain suppliers for the purchase of raw materials and services, which are not included in the table above. These purchase orders are generally short-term in nature and include a requirement that our supplier provide products or services to our specifications and require us to make a firm purchase commitment to our supplier. The costs associated with these agreements will be reflected in cost of sales on our Consolidated Statements of Income as substantially all of these commitments are associated with purchases made to fulfill our customers’ orders.

The following is a summary of other off-balance sheet arrangements at December 31, 2017:2022:

(In millions)Total
Amount		CurrentLong-Term
Letters of credit and bank guarantees$33.7 $31.3 $2.4 
Surety bonds103.1 18.0 85.1 
Total other off-balance sheet arrangements$136.8 $49.3 $87.5 
 Amount of commitment expiration per period 
(In millions)
Total
amount
 
Less than 1
year
 
1 - 3
years
 
3-5
years
 
After 5
years
 
Letters of credit and bank guarantees$43.6
 $39.6
 $3.6
 $—
 $0.4
 
Surety bonds158.2
 44.9
 87.5
 25.8
 —
 
Total other off-balance sheet arrangements$201.8
 $84.5
 $91.1
 $25.8
 $0.4
 


To provide required security regarding our performance on certain contracts, we provide letters of credit, surety bonds and bank guarantees, for which we are contingently liable. In order to obtain these financial instruments, we pay fees to various financial institutions in amounts competitively determined in the marketplace. Our ability to generate revenue from certain contracts is dependent upon our ability to obtain these off-balance sheet financial instruments.


Our off-balance sheet financial instruments may be renewed, revised or released based on changes in the underlying commitment. Historically, our commercial commitments have not been drawn upon to a material extent; consequently, management believes it is not likely that there will be claims against these commitments that would result in a negative impact on our key financial ratios or our ability to obtain financing.


38

Cash Flows


Cash flows for each of the three year periodsyears ended on December 31, 2022 and 2021 were as follows:

(In millions)20222021
Cash provided by operating activities$142.3 $225.7 
Cash required by investing activities(416.1)(272.9)
Cash provided by financing activities270.6 80.8 
Effect of foreign exchange rate changes on cash and cash equivalents(2.5)(2.3)
(Decrease) increase in cash and cash equivalents$(5.7)$31.3 

(In millions)2017 2016 2015 
Cash provided by continuing operating activities$106.3
 $67.9
 $112.2
 
Cash required by continuing investing activities(139.9) (266.8) (185.1) 
Cash provided by financing activities34.7
 194.9
 83.9
 
Cash required by discontinued operations(1.7) (0.5) (0.3) 
Effect of foreign exchange rate changes on cash and cash equivalents1.4
 0.5
 (6.8) 
Increase (decrease) in cash and cash equivalents$0.8
 $(4.0) $3.9
 

20172022 Compared with 20162021


Cash provided by continuing operating activities in 2017 were $106.32022 was $142.3 million, representing a $38.4$83.4 million increasedecrease compared to 2016. The2021.
A lower operating cash flow in 2022 was primarily driven by a higher investment in inventory and an increase in theoutstanding trade receivables, partially offset by an increase in accounts payable. A higher operating cash flows isflow in 2021 was primarily driven by higher incomean increase in 2017 compared to 2016customer advance payments and in accounts payable, partially offset by a higher investmentsinvestment in working capitalinventory and an increase in 2017 compared to 2016.outstanding trade receivables.


Cash required by investing activities during 20172022 was $139.9$416.1 million, representing a $126.9$143.2 million decreaseincrease compared to 2016. The change was2021, primarily due primarily to a lower level of investments in acquired companies, where we invested $104.2 million on acquisitions completed during 2017 compared to an investment in 2016 of $232.0 million.increased acquisition and capital expenditure spending year over year.


Cash provided by financing activities of $270.6 million in 2017 were $34.72022 represents an increase of $189.8 million representing a $160.2 million decrease compared to 2017. On March 6, 2017 we issued 2.3same period in 2021. This increase is primarily driven by higher borrowings to fund acquisitions in the current year, partially offset by prior year activity that did not recur in the current year. Specifically the cash provided by financing activities of $80.8 million shares of common stock which resulted in net proceeds of $184.1 million. We used the net2021 was primarily due to proceeds from this offering to repay a portionthe issuance of our outstandingthe convertible notes, bond hedge and warrant transactions, partially offset by paying down borrowings under our revolving credit facility and for general corporate purposes. Higher operating cash flows and lower investments in acquisitions allowed for significant reduction in borrowings under our revolving credit facility.payment of acquisition date earn-out liability.

2016 Compared with 2015

Cash flows provided by continuing operating activities in 2016 were $67.9 million, representing a $44.3 million decrease compared to 2015. The change in the operating cash flows is driven primarily by a decrease in advance payments and progress billings, an increase in inventory, as well as an increase in trade receivables due to timing of customer payments. These decreases in operating cash flow were partially offset by higher income in 2016 compared to 2015.


Cash required by investing activities during 2016 was $266.8 million, representing a $81.7 million increase compared to 2015. The change was due primarily to larger investments in acquired companies, where we invested $232.0 million on acquisitions completed during 2016 compared to acquisition costs in 2015 of $150.9 million.

Cash flows provided by financing activities in 2016 were $194.9 million, representing a $111.0 million increase compared to 2015. The change in financing cash flows was primarily driven by borrowings against our revolving credit facility to provide the funding required for the acquisitions completed during 2016.


Financing Arrangements

We have a $600.0 million revolving credit facility, with Wells Fargo Bank, N.A. as administrative agent, that matures in February 2020. This revolving credit facility permits borrowings in the U.S. and in the Netherlands. Borrowings bear interest, at our option, at U.S. LIBOR subject to a floor rate of zero or an alternative base rate, which is the greater of Wells Fargo’s Prime Rate, the Federal Funds Rate plus 50 basis points, and LIBOR plus 1%, plus, in each case, a margin dependent on our leverage ratio. We must also pay an annual commitment fee of 15.0 to 30.0 basis points dependent on our leverage ratio. The Credit Agreement evidencing the facility contains customary representations, warranties, and covenants, including a maximum interest coverage ratio and maximum leverage ratio, as well as certain events of default.

We have an incremental term loan in the amount of $150.0 million which bears interest on the same fully funded terms as the revolving credit facility and matures in February 2020. We are required to make mandatory prepayments, subject to certain exceptions, of the term loan with the net cash proceeds of (i) any issuance or other incurrence of indebtedness not otherwise permitted under the Credit Agreement and (ii) certain sales or other dispositions of assets subject to certain exceptions and thresholds. We are required to repay the term loan in quarterly principal installments of $1.9 million beginning on March 31, 2018, with a balloon payment at maturity to pay the remaining outstanding balance.


As of December 31, 20172022 we had $150.0 million outstanding under the term loan within the credit facility, $230.5$584.6 million drawn on and $354.7$709.0 million of availability under the revolving credit facility. Our ability to use this availability is limited by the leverage ratio covenantrestrictive covenants described below.


The Credit AgreementOur credit agreement includes restrictive covenants that, if not met, could lead to a renegotiation of our credit lines, a requirement to repay our borrowings and/or a significant increase in our cost of financing. Restrictive covenants include a minimum interest coverage ratio, a maximum leverage ratio, as well as certain events of default. As of December 31, 2017,2022, we were in compliance with all covenants in the Credit Agreement.our credit agreement. We expect to remain in compliance with all covenants in the foreseeable future. However, there can be no assurance that continued or increased volatility in global economic conditions will not impair our ability to meet our covenants, or that we will continue to be able to access the capital and credit markets on terms acceptable to us or at all. In February 2017,

On May 28, 2021, we exercised our option to temporarily increase the maximum allowable leverage ratio under the Credit Agreement from 3.5x to 4.0x, for the quarter ended December 31, 2016 and the following three quarters. The leverage ratio increase option is available for the first quarter end after we completeclosed a permitted acquisition with a purchase price in excessprivate offering of $100 million. Our exercise$402.5 million aggregate principal amount of the leverage ratio increase option hasCompany's 0.25% Convertible Senior Notes due 2026 (the "Notes") to qualified institutional buyers, resulting in net proceeds to us of approximately $392.2 million after deducting initial purchasers’ discounts. The Notes will mature on May 15, 2026 unless earlier converted, redeemed or repurchased. Concurrently with the effectissuance of temporarily increasing the amount we are able to borrow under the revolving credit facility.

In May 2017,Notes, we entered into a fourth amendment to the Credit Agreement. This amendment revoked the leverage ratio increase period and returned us to the original maximum leverage ratio of 3.5x, as well as immediately reset the leverage ratio increase option so it would be available to us without a waiting periodNote hedge transactions that would otherwise apply. The amendment expanded the qualifying event to allow for the option to be exercised if any permitted acquisition, or a series of permitted acquisitions occurring within any consecutive twelve (12) month period following the first such permitted acquisition, had aggregate consideration in excess of $100.0 million. It also provided flexibility to JBT in determining the lengthreduce potential dilution upon conversion of the leverage ratio increase period, but notNotes and into the warrant transactions to exceedraise additional capital to partially offset the costs of entering into the Note hedge transactions.

For additional information about our credit agreement, Notes, convertible note hedge and warrant transactions, refer to Note 7. Debt of the Notes to Consolidated Financial Statements.

As of December 31, 2022, we have four quarters.

We have entered into interest rate swaps to fix theexecuted in March 2020 with a combined notional amount of $200 million expiring in April 2025, and one interest rate applicable to certainswap executed in May 2020 with a notional amount of our variable-rate debt. The agreements swap one-month LIBOR for fixed rates.$50 million expiring in May 2025. We have designated these swaps as cash flow hedges and all changes in fair value of the swaps are recognized in Accumulated other comprehensive income (loss).

As a result, as of December 31, 2017, some2022, a significant portion of our total outstanding debt wasof $987.1 million effectively remains fixed rate debt, while approximately $155.9with the Convertible Senior Notes subject to a fixed rate of 0.25% and a portion of the revolving credit facility subject to an average fixed rate of 0.82%. Approximately $334.6 million, or 40.7%34%, wasremained subject to floating, or market rates. To the extent interest rates increase in future periods, our earnings could be negatively impacted by higher interest expense.


As part of our strategy to grow in Asia, we are expanding our operations in China and India. Due to greater restrictions on foreign currency exchange in these regions, we have established credit facilities to fund some of the local working capital requirements in these markets. Four of our wholly owned subsidiaries have short term credit facilities that allow us to borrow up to $12 million in China, which mature on June 30, 2018. We had $2.7 million in borrowings under the credit facilities in China as of December 31, 2017. Our wholly-owned subsidiary in India has a short term credit facility that allows us to borrow up to $1.4 million. As of December 31, 2017, we had no outstanding amount borrowed under this credit facility.
39



Critical Accounting Estimates


We prepare our consolidated financial statements in conformity with U.S. generally accepted accounting principles. As such, we are required to make certain estimates, judgments and assumptions about matters that are inherently uncertain. On an ongoing basis, our management re-evaluates these estimates, judgments and assumptions for reasonableness because of the critical impact that these factors have on the reported amounts of assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the periods presented. Management has discussed the development and selection of these critical accounting estimates with the Audit Committee of our Board of Directors, and the Audit Committee has reviewed this disclosure. We believe that the following are the critical accounting estimates used in preparing our financial statements.


InventoryIntangible Asset Valuation


Inventory is recorded at the lower of cost or net realizable value. In order to determine net realizable value, we evaluate each component of inventory on a regular basis to determine whether it is excess or obsolete. We record the estimated decline in the carrying value of excess or obsolete inventory as a reduction of inventory and as an expense included in cost of sales in the period in which it is identified. Our estimate of excess and obsolete inventory is a critical accounting estimate because it is highly susceptible to change from period to period. In addition, itAccounting for business combinations requires management to make judgments aboutsignificant estimates and assumptions at the future demandacquisition date specifically for inventory.
In order to quantifythe valuation of intangible assets. We use the multi-period excess or obsolete inventory, we begin by preparing a candidate listing of the components of inventory that have not demonstrated usage within the most recent three-year period. This list is then reviewed by management personnel to determine whether this list of potential excess or obsolete inventory items have orders or expected demand in the near term. The remaining items on the candidate listing are written down to their estimated net realizable value. Inherent in the estimates of net realizable value are estimates related to our future manufacturing schedules, customer demand, possible alternative uses, and ultimate realization of potentially excess inventory.
Goodwill

Goodwill represents the excess of the cost of an acquired business over the amounts assigned to the identifiable net assets. Goodwill is not amortized but is tested for impairment at a reporting unit level on an annual basis, or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. We are required to make certain subjective and complex judgments in assessing whether an event that could indicate an impairment of goodwill has occurred, and must make assumptions and estimatesearnings method to determine the fair value of our reporting units. We may first assess qualitative factorsthe customer relationships and the relief-from-royalty approach to make this determination. If we conclude that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount based on our qualitative assessment, then a quantitative test is not necessary.

We may also choose to bypass the qualitative assessment and perform the quantitative test. In performing the quantitative test, we determine the fair value of a reporting unit using the “income approach” valuation method. We use a discounted cash flow modeltradename and proprietary technology.
Critical estimates and assumptions in whichvaluing certain of the intangible assets we have acquired include, but are not limited to, forecasted revenue growth rates, EBITDA margins, discount rates, customer attrition rates and royalty rates. The discount rates used to discount expected future cash flows anticipated over several periods, plus a terminal value at the end of that time horizon, are discounted to their present value using an appropriateare typically derived from a weighted-average cost of capital rate. Judgment is required in developinganalysis and adjusted to reflect inherent risks. Unanticipated events and circumstances may occur that could affect either the accuracy or validity of such assumptions, for the discounted cash flow model. These assumptions include revenue growth rates, profit margin percentages, discount rates, perpetuity growth rates, future capital expenditures, and working capital requirements, among others. If the estimated fair value of a reporting unit exceeds its carrying value, we consider that goodwill is not impaired. If the carrying value exceeds estimated fair value, there is an indication of potential impairment, and an impairment loss is recorded. We calculate the impairment loss by comparing the fair value of the reporting unit less its carrying amount, including goodwill.estimates or actual results.


We completed our annual goodwill impairment test as of October 31, 2017 using a quantitative assessment approach. As a result of this assessment we noted that the fair value of each reporting unit substantially exceeds its carrying value and therefore none of our goodwill was impaired.

Income Taxes

In determining our current income tax provision, we assess temporary differences resulting from differing treatments of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are recorded in our consolidated balance sheets. When we maintain deferred tax assets, we must assess the likelihood that these assets will be recovered through adjustments to future taxable income. To the extent we believe, based on available evidence, it is more likely than not that all or some portion of the asset will not be realized, we establish a valuation allowance. We record an allowance reducing the asset to a value we believe is more likely than not of being realized based on our expectation of future taxable income. We believe the accounting estimateSensitivities related to the acquisition of Bevcorp, LLC ("Bevcorp")
The valuation allowance isof Bevcorp's intangible assets were based in part on the key assumptions of customer attrition rate and discount rate for customer relationship intangible assets, and royalty rate for patents and acquired technology intangible assets. The customer attrition rate was selected based on historical experience and information obtained from Bevcorp's management. An increase or decrease of 100 basis points in the customer attrition rate would result in a critical accounting estimate because it is highly susceptible to change from period to period as it requires management to make assumptions about our future income overdecrease of $12 million or an increase of $13 million, respectively, in the livesvalue of Bevcorp's customer relationship intangible assets. Additionally, an increase or decrease in the discount rate of 50 basis points would result in a decrease of $5 million or an increase of $6 million, respectively, in the value of Bevcorp's customer relationship intangible assets. The royalty rate used in the valuation of Bevcorp's trade name, patents and acquired technology intangible asset was based on a detailed analysis considering the importance of the deferred tax assets,trade name and technology to the impactoverall enterprise and market royalty data. An increase or decrease of increasing50 basis points in the royalty rate would result in an increase or decreasingdecrease of $5.6 million in the valuation allowance is potentially materialof these assets.

Revenue Recognition

We recognize a large portion of our product revenue over time, for contracts that provide highly customized equipment and refurbishments of customer-owned equipment for which we have a contractual, enforceable right to our resultscollect payment upon customer cancellation for performance completed to date. We utilize the input method of operations.

Forecasting future income“cost-to-cost” to recognize revenue over time which requires us to use a significant amount of judgment. In estimating future income,that we use our internal operating budgets and long-range planning projections. We develop our budgets and long-range projectionsmeasure progress based on recent results, trends, economiccosts incurred to date relative to total estimated cost at completion. These cost estimates are based on assumptions and industry forecasts influencing our segments’ performance, our backlog, planned timingestimates to project the outcome of new product launches,future events including estimated labor and customer sales commitments. Significant changes in the expected realization of the net deferred tax assets would require that we adjust the valuation allowance, resulting in a changematerial costs required to net income.complete open projects.

On December 22, 2017, Congress passed, and the President signed, the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax Code, including, but not limited to, (1) reducing the U.S. federal corporate income tax rate from 35.0 percent to 21.0 percent; (2) requiring companies to pay a one-time transitional tax on certain un-repatriated earnings of foreign subsidiaries; (3) generally eliminating U.S. federal income tax on dividends from foreign subsidiaries of U.S. corporations; (4) repealing the domestic production activity deduction; (5) providing for the full expensing of qualified property; (6) adding a new provision designed to tax global intangible low-taxed income (“GILTI”); (7) revising the limitation imposed on deductions for executive compensation paid by publicly-traded companies; (8) eliminating the corporate alternative minimum tax (“AMT”) and changing how existing AMT credits can be utilized; (9) creating a base erosion-anti-abuse tax (“BEAT”), a new minimum tax on payments made by certain U.S. corporations to related foreign parties; (10) imposing a new limitation on the deductibility of interest expense; (11) allowing for a deduction related to foreign-derived intangible income (“FDII”); and (12) changing the rules related to the uses and limitations of net operating loss carryforwards generated in tax years beginning after December 31, 2017. See Note. 7 Income Taxes for further details on the impacts of these changes to the Company.
Defined Benefit Pension and Other Post-retirement Plans


The measurement of pension and other post-retirement plans’ costs requires the use of assumptions for discount rates, investment returns, employee turnover rates, retirement rates, mortality rates and other factors. The actuarial assumptions used in our pension and post-retirement benefit reporting are reviewed annually and compared with external benchmarks to ensure that they appropriately account for our future pension and post-retirement benefit obligations. While we believe that the assumptions used are appropriate, differences between assumed and actual experience may affect our operating results.


Our accrued pension and other post-retirement benefits liability reflects the funded status of our worldwide plans, or the projected benefit obligation net of plan assets. Our discount rate assumption is determined by developing a yield curve based on high quality corporate bonds with maturities matching the plan’s expected benefit payment streams. The plans’ expected cash flows are then discounted by the resulting year-by-year spot rates. The projected benefit obligation is sensitive to changes in our estimate of the discount rate. The discount rate used in calculating the projected benefit obligation for the U.S. pension plan, which represents 85%87% of all pension plan obligations, was 3.73%5.18% in 2017, 4.30%2022, 2.90% in 20162021 and 4.60%2.57% in 2015.2020. A decrease of 50 basis points in the discount rate used in our calculation would increase our projected benefit obligation by $19.8$11.9 million.


Our pension expense is sensitive to changes in our estimate of the expected rate of return on plan assets. The expected return on assets used in calculating the pension expense for the U.S. pension plan, which represents 96%94% of all pension plan assets, was 6.75%5.50% for 2017, 7.00%
40

2022, 5.75% for 20162021 and 7.25%5.0% for 2015.2020. For 2018,2023, the rate is expected to be 6.50%6.25%. A change of 50 basis points in the expected return on assets assumption would impact pension expense by $1.3$1.4 million (pre-tax).


See Note 8.9. Pension and Post-Retirement and Other Benefit Plans of the notes to Consolidated Financial Statements in Item 8. Financial Statements and Supplementary Data for additional discussion of our assumptions and the amounts reported in the Consolidated Financial Statements.


Recently AdoptedRecent Accounting StandardsPronouncements


In July 2015,For information with respect to recent accounting pronouncements and the FASB issued ASU No. 2015-11, Inventory (Topic 330) – Simplifying the Measurementimpact of Inventory. The core principle of the ASU is that entities that historically used the lower of cost or market in the subsequent measurement of inventory will instead be required to measure inventory at the lower of cost and net realizable value. The guidance will not change U.S. GAAP for inventory measured using LIFO or the retail inventory method. The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2016. This guidance became effective for us as of January 1, 2017 and there was no effectthese pronouncements on our consolidated financial statements and related disclosures.

In March 2016, the FASB issued ASU No. 2016-09, Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting. The new guidance was developed as partsee Note 1 of the FASB’s simplification initiative. The core principle of the ASU requires income tax effects of awardsNotes to be recognized in the income statement when the awards vest or are settled, and eliminates the requirement to report excess tax benefits in additional paid-in capital (APIC pool). It also allows an employer to repurchase more of an employee’s shares for tax withholding purposes without triggering liability accounting, and allows an employer to make a policy election to account for forfeitures as they occur. The new standard became effective for us as of January 1, 2017. During 2017,Consolidated Financial Statements.


296,608 awards vested, and resulted in a $6.4 million tax benefit reported in earnings, and is classified as an operating activity within the condensed consolidated Statements of Cash Flows. The elimination of the APIC pool affects the treasury stock method used to calculate weighted average shares outstanding; however, the impact was not material. We elected to change our policy surrounding forfeitures, and beginning January 2017 we no longer estimate the number of awards expected to be forfeited but rather account for them as they occur. We are required to implement this portion of the guidance using a modified retrospective approach, and as such have recorded a cumulative adjustment of $0.6 million in retained earnings as of January 1, 2017.

We also amended our incentive compensation and stock plan to allow JBT to have the discretion to withhold up to the maximum statutory rates on an individual tax basis. A liability was not established as the withholding limits do not exceed the maximum. Cash paid for tax withholdings are classified as financing activity on the condensed consolidated Statement of Cash Flows, consistent with prior years.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230) Classification of Certain Cash Receipts and Cash Payments and Restricted Cash. The new guidance is intended to reduce the existing diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The core principle of the ASU requires the classification of eight specific cash flow issues identified under ASC 230 to be presented as either financing, investing or operating, or some combination thereof, depending upon the nature of the issue. Entities are required to use a retrospective transition approach for all of the issues identified for each period presented. The Company adopted the new ASU as of September 30, 2017. There was no impact on our consolidated financial statements and related disclosures as a result of adopting the ASU.

In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) - Clarifying the Definition of a Business. The core principle of the ASU is to clarify the definition of a business to require certain transactions to be accounted for as business combinations versus an acquisition of assets. The Company adopted the new ASU as of September 30, 2017. There was no impact on our consolidated financial statements and related disclosures as a result of adopting the ASU.
In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment. The new guidance will simplify the accounting for goodwill impairment. The core principle of the ASU is to remove the requirement to calculate an implied fair value to determine impairment (Step 2 of the goodwill impairment test) and allow instead for goodwill impairment to equal the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The Company early adopted the new ASU as of September 30, 2017, prior to our 2017 annual testing of goodwill impairment, performed as of October 31st. There was no impact on our consolidated financial statements and related disclosures as a result of adopting the ASU.

In May 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (ASC 718) - Scope of Modification Accounting. The amendments provide guidance as to how an entity should account for a change in the terms and conditions of its share-based payment awards. The core principle of the ASU is to provide clarity, and reduce the variation in applied practice, as well as, cost and complexity in accounting for a change in the terms and conditions in an entity's share-based payment awards. The Company adopted the new ASU as of September 30, 2017. There was no impact on our consolidated financial statements and related disclosures as a result of adopting the ASU.
Recently Issued Accounting Standards Not Yet Adopted

Beginning in 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), plus a number of related ASU’s designed to clarify and interpret Topic 606. The new standard will replace most existing revenue recognition guidance in U.S. GAAP. The core principle of the ASU requires companies to reevaluate when revenue is recorded based upon newly defined criteria, either at a point in time or over time as goods or services are delivered. The ASU requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and estimates, and changes in those estimates. The new standard became effective for us as of January 1, 2018. As previously disclosed, we will adopt Topic 606 on a modified-retrospective basis.

In 2017, we completed our gap assessment and determined that in certain contracts, we will qualify for over time recognition for our manufactured equipment that is highly engineered to unique customer specifications. In addition, we expect that due to the nature of our equipment and installation contracts that we will combine these into one performance obligation. Under Topic 606, revenue recognized for contracts that meet certain criteria will result in revenue being recognized as the equipment is being manufactured which is an acceleration of revenue as compared to our current revenue recognition methodology of recognizing revenue, generally when the equipment is shipped to the customer. This conclusion, specific to equipment contracts for which the equipment is highly engineered to unique customer specifications, is dependent on whether our contract with the customer provides us, upon customer cancellation, with an enforceable right to payment for performance completed to date. Where the contract does not provide explicit language regarding cancellation payments, revenue will be recognized at a point in time, usually upon completion of the installation of the equipment. Therefore, some revenue will be deferred and recognized at a later date. This impacts both equipment contracts with

installation that qualify as one performance obligation, and that were previously recognized upon shipment, as well as certain equipment contracts for which revenue was recognized under percentage of completion accounting under legacy GAAP.

We continue to execute our implementation plan and have developed new revenue accounting policies and processes; changed our internal controls over revenue recognition; created pro forma disclosures; and continue to implement system changes and enhancements. We are in the process of evaluating all contracts not completed on January 1, 2018 and have preliminarily determined the net impact of adopting this standard will be a reduction to retained earnings within the range of $25 million to $30 million. This differs significantly from the expected impact previously disclosed and is due solely due to interpretations published subsequent to our previous disclosure regarding what constitutes an enforceable right to payment. For full year 2018 results, we expect the financial statement impact of this deferral will be substantially offset by the requirement to defer revenue on contracts that, under legacy GAAP, would have been recognized in 2018, but will be deferred until 2019 under the new standard. Our assessment of the foregoing is ongoing and subject to finalization, such that the actual impact of the adoption may differ materially from the estimated ranges described above.
Upon adoption of the new revenue standard in the first quarter of 2018, the timing of revenue recognition for certain projects will vary and may be recorded upon shipment based on contract terms, when previously such projects were recorded over time. The impact to future revenue trends is uncertain as it will depend on future orders and contract terms. However, cash flows and overall profitability of a contract at completion are unchanged by the new standard.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The new standard will replace most existing lease guidance in U.S. GAAP. The core principle of the ASU is the requirement for lessees to report a right to use asset and a lease payment obligation on the balance sheet, but recognize expenses on their income statements in a manner similar to today’s accounting. Accounting for lessors will remains substantially similar to current U.S. GAAP. The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2018. However, early adoption is permitted. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. We are in the process of evaluating the impact this standard will have on our consolidated financial statements and related disclosures.

In October 2016, the FASB issued ASU 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory. The new guidance is intended to simplify the accounting for intercompany asset transfers. The core principle requires an entity to immediately recognize the tax consequences of intercompany asset transfers. The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2017. However, early adoption is permitted only at the beginning of an annual period for which no financial statements (interim or annual) have already been issued. The Company will adopt this standard in the effective period. The impact to our consolidated financial statements and related disclosures will be immaterial.

In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (ASC 715) - Improving the Presentation of Net Periodic Pension Costs and Net Periodic Postretirement Benefit Cost. The new guidance will change the presentation of pension cost by providing additional guidance on the presentation of net benefit cost in the income statement and on the components eligible for capitalization in assets. The core principle of the ASU is to provide more transparency in the presentation of these costs by requiring the service cost component to be reported in the same line item as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented separately from the service cost component and outside a subtotal of income from operations. The amendments require that the Statements of Income impacts be applied retrospectively, while Balance Sheet changes should be applied prospectively. As such, upon adoption in 2018, the Company expects to reduce operating income for fiscal year 2017 by $2.0 million, and report this income in non operating income. Operating income for the fiscal year 2016 will be reduced by $2.3 million. There will be no impact to net income or to the Balance Sheet or Statement of Cash Flows.
The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2017. However, early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. The Company will adopt the newly issued ASU as of January 1, 2018.

In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (ASC 815) - Targeted Improvements to Accounting for Hedging Activities. The core of the principle is to simplify hedge accounting, as well as improve the financial reporting of hedging results, for both financial and commodity risks, in the financial statements and related disclosures. The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted in any interim period after the issuance of the amendment, however, any adjustments should be made as of the beginning of the fiscal year in which the interim period occurred. The Company is currently evaluating the effect, if any, that the ASU will have on our consolidated financial statements and related disclosures.


ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


We are subject to financial market risks, including fluctuations in foreign currency exchange rates and interest rates. In order to manage and mitigate our exposure to these risks, we may use derivative financial instruments in accordance with established policies and procedures. We do not use derivative financial instruments where the objective is to generate profits solely from trading activities. At December 31, 20172022 and 2016,2021, our derivative holdings consisted of foreign currency forward contracts and foreign currency instruments embedded in purchase and sale contracts and interest rate swap contracts.


These forward-looking disclosures address potential impacts from market risks only as they affect our financial instruments. They do not include other potential effects resulting from changes in foreign currency exchange rates, interest rates, commodity prices or equity prices that could impact our business..business.


Foreign Currency Exchange Rate Risk


During 2017,2022, our foreign subsidiaries generated 31.4% of our revenue, the largest component of which was our operations in Sweden which generated 8.3%36% of our revenue. Financial statements of our foreign subsidiaries for which the U.S. dollar is not the functional currency are translated into U.S. dollars. As a result, we are exposed to foreign currency translation risk.


When we sell or purchase products or services, transactions are frequently denominated in currencies other than an operation’s functional currency. As a result, we are exposed to foreign currency transaction risk. When foreign currency exposures exist, we may enter into foreign exchange forward instruments with third parties to economically hedge foreign currency exposures. Our hedging policy reduces, but does not entirely eliminate, the impact of foreign currency exchange rate movements. We do not apply hedge accounting for our foreign currency forward instruments.


We economically hedge our recognized foreign currency assets and liabilities to reduce the risk that our earnings and cash flows will be adversely affected by fluctuations in foreign currency exchange rates. We expect any gains or losses in the hedging portfolio to be substantially offset by a corresponding gain or loss in the underlying exposures being hedged. We also economically hedge firmly committed anticipated transactions in the normal course of business. As these are not offset by an underlying balance sheet position being hedged, our earnings can be significantly impacted on a periodic basis by the change in the unrealized value of these hedges.


We use a sensitivity analysis to measure the impact of an immediate 10% adverse movement in the foreign currency exchange rates. This calculation assumes that each exchange rate would change in the same direction relative to the U.S. dollar and all other variables are held constant. We expect that changes in the fair value of derivative instruments will offset the changes in fair value of the underlying assets and liabilities on the balance sheet. A 10% adverse movement in the foreign currency exchange rates would have an immaterial impact onreduce the value of our derivative instruments by $5.1 million (pre-tax) as of December 31, 2017.2022. This amount would be reflected in our net income but would be significantly offset by the changes in the fair value of the underlying hedged assets and liabilities.


In July 2018, we entered into a series of cross-currency swaps with an aggregate notional of $116.4 million (€100 million) to hedge the currency exchange component of net investments in certain foreign subsidiaries. The aggregate fair value of these swaps was an asset position of $9.9 million at December 31, 2022. We use a sensitivity analysis to measure the impact of an immediate 10% adverse movement in the foreign currency exchange rates underlying these swaps. A hypothetical 10% adverse movement in the currency exchange rates underlying these swaps from the market rate at December 31, 2022 would have resulted in a loss in value of the swaps by $10.7 million.
41

Market Risk and Interest Rate Risk

Our debt instrumentsborrowings from the revolving credit facility subject us to market risk associated with movements in interest rates. We had $383.3$334.6 million in variable rate debt outstanding at December 31, 2017.2022. A hypothetical 10% adverse movement in the interest rate would not significantly impact thewill increase our annual interest expense.expense by $1.7 million.


We have entered intoAs of December 31, 2022, we had four interest rate swaps to fix theexecuted in March 2020 with a combined notional amount of $200 million expiring in April 2025, and one interest rate applicable to certainswap executed in May 2020 with a notional amount of our variable-rate debt. The agreements swap one-month LIBOR for fixed rates.$50 million expiring in May 2025. We have designated these swaps as cash flow hedges and all changes in fair value of the swaps are recognized in accumulatedAccumulated other comprehensive income.income (loss). We use a sensitivity analysis to measure the impact on fair value of the interest rate swaps of an immediate adverse movement in the interest rates of 50 basis points. This analysis was based on a modeling technique that measures the hypothetical market value resulting from a 50 basis point change in interest rates. This adverse change in the applicable interest rates would result in an increasea decrease of $2.5 million in the net fair value of our interest rate swaps for $250 million of notional value expiring in 2025.

In May 2021, we issued $402.5 million aggregate principal amount of Convertible Senior Notes (the “Notes”) due 2026. We do not have economic interest rate exposure as the Notes have a fixed annual rate of 0.25%. The fair value of the Notes is subject to interest rate risk, market risk and other factors due to its conversion feature. The fair value of the Notes is also affected by the price and volatility of our common stock and will generally increase or decrease as the market price of our common stock changes. The interest and market value changes affect the fair value of the Notes but do not impact our financial position, cash flows or results of operations due to the fixed nature of the debt obligation. Additionally, we carry the Notes at December 31, 2017.face value, less any unamortized issuance costs, on the balance sheet and present the fair value for disclosure purposes only.

42




ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Report of Independent Registered Public Accounting Firm


The Stockholders andTothe Board of Directors
and Stockholders of John Bean Technologies Corporation:Corporation


OpinionOpinions on the Consolidated Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of John Bean Technologies Corporation and its subsidiaries (the “Company”) as of December 31, 20172022 and 2016,2021, and the related consolidated statements of income, comprehensive income, (loss), changes in stockholders’ equity, and cash flows for each of the two years in the three‑year period ended December 31, 2017, and2022, including the related notes and financial statement schedule IIof valuation and qualifying accounts for each of the two years in the period ended December 31, 2022 listed in the index appearing under Item 15(a) (2) (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2022, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 20172022 and 2016,2021, and the results of its operations and its cash flows for each of the two years in the three‑year period ended December 31, 2017,2022 in conformity with U.S.accounting principles generally accepted accounting principles.
We also have audited, in accordance with the standardsUnited States of America. Also in our opinion, the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’smaintained, in all material respects, effective internal control over financial reporting as of December 31, 2017,2022, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 28, 2018 expressed an unqualified opinion on the effectiveness of the Company’sCOSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting.
Basisreporting, and for Opinion
These consolidated financial statements are the responsibilityits assessment of the Company’s management.effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express an opinionopinions on thesethe Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits.audit. We are a public accounting firm registered with the PCAOBPublic Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our auditsaudit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. fraud, and whether effective internal control over financial reporting was maintained in all material respects.
Our auditsaudit of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our auditsaudit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinions.

As described in Management’s Annual Report on Internal Control over Financial Reporting, management has excluded Alco-food-machines GmbH & Co. KG ("Alco") and Bevcorp, LLC ("Bevcorp") from its assessment of internal control over financial reporting as of December 31, 2022, because they were acquired by the Company in purchase business combinations during 2022. We have also excluded Alco and Bevcorp from our audit of internal control over financial reporting. Alco and Bevcorp are wholly-owned subsidiaries whose total assets and total revenues excluded from management’s assessment and our audit of internal control over financial reporting collectively represent 5.3% and 2.4%, respectively, of the related consolidated financial statement amounts as of and for the year ended December 31, 2022.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

43

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Revenue Recognition - Product Revenue Estimated Costs at Completion

As described in Note 1 to the consolidated financial statements, the Company recognized $740.7 million of product revenue for the year ended December 31, 2022, for over time projects using the “cost-to-cost” input method. Revenue is recognized over time for refurbishments of customer-owned equipment and for highly customized equipment for which the Company has a contractual, enforceable right to collect payment upon customer cancellation for performance completed to date. As disclosed by management, the "cost-to-cost" input method requires that management measure progress based on costs incurred to date relative to total estimated cost at completion. Cost estimates are based on assumptions and estimates to project the outcome of future events; including estimated labor and material costs required to complete open projects.

The principal considerations for our determination that performing procedures relating to revenue recognition - product revenue estimated costs at completion is a critical audit matter are (i) the significant judgment by management when determining the estimated costs at completion, and (ii) the high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s assumptions related to estimated labor and material costs required to complete open projects.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the product revenue recognition process, including controls over the determination of estimated costs at completion. These procedures also included, among others, evaluating and testing management’s process for determining the estimated costs at completion for a sample of contracts, which included evaluating the reasonableness of assumptions related to the estimated labor and material costs required to complete open projects used by management and considering the factors that can affect the accuracy of those estimates. Evaluating the reasonableness of assumptions used involved assessing management’s ability to reasonably estimate costs at completion by (i) testing the completeness and accuracy of underlying data used in the estimate; (ii) performing a comparison of the originally estimated and actual costs incurred on similar completed contracts; (iii) evaluating the timely identification of circumstances that may warrant a modification to estimated costs at completion; and (iv) evaluating responses to inquiries with the Company’s project managers regarding the expected remaining efforts.

Acquisition of Bevcorp – Valuation of Customer Relationship Intangible Asset

As described in Note 2 to the consolidated financial statements, the Company acquired 100% voting equity of Bevcorp LLC (“Bevcorp”) for a total net consideration of $288.1 million, which resulted in $127.0 million of a customer relationship intangible asset being recorded. As disclosed by management, management uses the multi-period excess earnings method to determine the fair value of the customer relationships. Management’s estimates and assumptions used to determine the fair value of the customer relationship intangible asset include forecasted revenue growth rates, EBITDA margins, customer attrition rate and the discount rate.

The principal considerations for our determination that performing procedures relating to the valuation of the customer relationship intangible asset from the acquisition of Bevcorp is a critical audit matter are the (i) the significant judgment by management when developing the fair value estimate of the customer relationship intangible asset acquired; (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to forecasted revenue growth rates, EBITDA margins, customer attrition rate and the discount rate; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the acquisition accounting, including controls over management’s valuation of the customer relationship intangible asset acquired. These procedures also included, among others (i) reading the purchase agreement; (ii) testing management’s process for developing the fair value estimate of the customer relationship intangible asset acquired; (iii) evaluating the appropriateness of the multi-period excess earnings method; (iv) testing the completeness and accuracy of underlying data used in the valuation method; and (v) evaluating the reasonableness of the significant assumptions used by management related to forecasted revenue growth rates, EBITDA margins, customer attrition rate and the discount rate. Evaluating the reasonableness of management’s significant assumptions related to forecasted revenue growth rates, EBITDA margins and the customer attrition rate involved considering (i) the current and past performance of the acquired business; (ii) the consistency with external market and industry data; and (iii) whether the assumptions
44

were consistent with evidence obtained in other areas of the audit. Professionals with specialized skill and knowledge were used to assist in the evaluation of (i) the appropriateness of the Company's multi-period excess earnings method and (ii) the reasonableness of the assumptions related to customer attrition rate and the discount rate.


/s/ PricewaterhouseCoopers LLP

Chicago, Illinois
February 23, 2023

We have served as the Company's auditor since 2021.
45

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors
John Bean Technologies Corporation:

Opinion on the Consolidated Financial Statements

We have audited the consolidated statements of income, comprehensive income, changes in stockholders’ equity, and cash flows of John Bean Technologies Corporation and subsidiaries (the Company) for the year ended December 31, 2020, and the related notes and financial statement schedule II (collectively, the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the results of the Company’s operations and its cash flows for the year ended December 31, 2020, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provideaudit provides a reasonable basis for our opinion.



/s/ KPMG LLP



We have served as the Company'sCompany’s auditor since 2007.from 2007 to 2021.


Chicago, Illinois
February 28, 201825, 2021

46

JOHN BEAN TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENTS OF INCOME

Year Ended December 31,
(In millions, except per share data)202220212020
Revenue:
Product revenue$1,873.2 $1,614.6 $1,498.3 
Service revenue292.8 253.7 229.5 
Total revenue2,166.0 1,868.3 1,727.8 
Operating expenses:
Cost of products1,343.0 1,124.1 1,029.0 
Cost of services205.7 177.4 165.1 
Selling, general and administrative expense441.9 401.1 358.5 
Restructuring expense7.0 5.6 12.1 
Operating income168.4 160.1 163.1 
Pension (income) expense, other than service cost— (1.3)3.7 
Interest expense, net14.2 8.7 13.9 
Net income before income taxes154.2 152.7 145.5 
Income tax provision23.5 34.3 36.7 
Net income$130.7 $118.4 $108.8 
Basic earnings per share:
Net income$4.08 $3.70 $3.40 
Diluted earnings per share:
Net income$4.07 $3.69 $3.39 
Weighted average shares outstanding:
Basic32.0 32.0 32.0 
Diluted32.1 32.1 32.1 
 Year Ended December 31, 
(In millions, except per share data)2017 2016 2015 
Revenue:      
Product revenue$1,376.8
 $1,133.1
 $957.8
 
Service revenue258.3
 217.4
 149.5
 
Total revenue1,635.1
 1,350.5
 1,107.3
 
Operating expenses:      
Cost of products961.1
 803.8
 676.2
 
Cost of services203.3
 166.0
 114.2
 
Selling, general and administrative expense294.4
 236.7
 207.0
 
Research and development expense28.7
 23.6
 18.2
 
Restructuring expense1.7
 12.3
 —
 
Other expense, net0.1
 4.7
 2.7
 
Operating income:145.8
 103.4
 89.0
 
Interest expense, net13.6
 9.4
 6.8
 
Income from continuing operations before income taxes132.2
 94.0
 82.2
 
Provision for income taxes50.1
 26.0
 26.2
 
Income from continuing operations82.1
 68.0
 56.0
 
Loss from discontinued operations, net of income taxes1.6
 0.4
 0.1
 
Net income$80.5
 $67.6
 $55.9
 
       
Basic earnings per share:      
Income from continuing operations$2.61
 $2.31
 $1.90
 
Loss from discontinued operations(0.05) (0.01) (0.01) 
Net income$2.56
 $2.30
 $1.89
 
Diluted earnings per share:      
Income from continuing operations$2.58
 $2.28
 $1.88
 
Loss from discontinued operations(0.05) (0.01) —
 
Net income$2.53
 $2.27
 $1.88
 
Dividends declared per share$0.40
 $0.40
 $0.37
 
Weighted average shares outstanding:      
Basic31.4
 29.4
 29.5
 
Diluted31.9
 29.8
 29.8
 


The accompanying notes are an integral part of the consolidated financial statements.



47

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

Year Ended December 31,
(In millions)202220212020
Net income$130.7 $118.4 $108.8 
Other comprehensive income (loss), net of income taxes
Foreign currency translation adjustments(34.5)1.0 (8.8)
Pension and other post-retirement benefits adjustments14.6 15.9 (14.4)
Derivatives designated as hedges13.0 5.6 (3.9)
Other comprehensive income (loss)(6.9)22.5 (27.1)
Comprehensive income$123.8 $140.9 $81.7 
 Year Ended December 31, 
(In millions)2017 2016 2015 
Net income$80.5
 $67.6
 $55.9
 
Other comprehensive income      
Foreign currency translation adjustments20.5
 (5.7) (21.9) 
Pension and other post-retirement benefits adjustments, net of tax(5.2) (4.8) (7.4) 
Derivatives designated as hedges, net of tax1.5
 0.7
 (0.8) 
Other comprehensive income (loss)16.8
 (9.8) (30.1) 
Comprehensive income$97.3
 $57.8
 $25.8
 


The accompanying notes are an integral part of the consolidated financial statements.

48

JOHN BEAN TECHNOLOGIES CORPORATION
CONSOLIDATED BALANCE SHEETS
(In millions, except per share and number of shares)December 31,
2022		December 31,
2021
Assets
Current Assets:
Cash and cash equivalents$73.1 $78.8 
Trade receivables, net of allowances299.0 239.1 
Contract assets89.6 94.4 
Inventories322.5 229.1 
Other current assets85.4 77.3 
Total current assets869.6 718.7 
Property, plant and equipment, net of accumulated depreciation of $346.4 and $339.2, respectively269.9 267.6 
Goodwill807.8 684.8 
Intangible assets, net445.4 342.6 
Other assets191.4 127.7 
Total Assets$2,584.1 $2,141.4 
Liabilities and Stockholders' Equity
Current Liabilities:
Short-term debt$0.6 $— 
Accounts payable, trade and other237.0 186.0 
Advance and progress payments194.7 190.2 
Accrued payroll58.5 56.6 
Other current liabilities130.4 117.1 
Total current liabilities621.2 549.9 
Long-term debt977.3 674.4 
Accrued pension and other post-retirement benefits, less current portion32.0 57.6 
Other liabilities90.9 109.0 
Commitments and contingencies (Note 17)
Stockholders' Equity:
Preferred stock, $0.01 par value; 20,000,000 shares authorized; no shares issued in 2022 or 2021— — 
Common stock, $0.01 par value; 120,000,000 shares authorized; 2022: 31,861,680 issued, and 31,803,721 outstanding; 2021: 31,769,967 issued and outstanding0.3 0.3 
Common stock held in treasury, at cost; 2022: 57,959, and 2021: 0(5.3)— 
Additional paid-in capital220.7 214.2 
Retained earnings851.3 733.4 
Accumulated other comprehensive loss(204.3)(197.4)
Total stockholders' equity862.7 750.5 
Total Liabilities and Stockholders' Equity$2,584.1 $2,141.4 
(In millions, except per share and number of shares)December 31,
2017		 December 31,
2016		 
     
Assets    
Current Assets:    
Cash and cash equivalents$34.0
 $33.2
 
Trade receivables, net of allowances of $3.2 and $3.1, respectively316.4
 260.5
 
Inventories190.2
 139.6
 
Other current assets48.0
 51.7
 
Total current assets588.6
 485.0
 
Property, plant and equipment, net of accumulated depreciation of $273.3 and $238.0, respectively233.0
 210.2
 
Goodwill301.8
 239.5
 
Intangible assets, net216.8
 186.0
 
Deferred income taxes13.1
 35.0
 
Other assets38.1
 31.7
 
Total Assets$1,391.4
 $1,187.4
 
     
Liabilities and Stockholders' Equity    
Current Liabilities:    
Short-term debt and current portion of long-term debt$10.5
 $7.1
 
Accounts payable, trade and other157.1
 135.7
 
Advance and progress payments127.6
 110.5
 
Accrued payroll49.8
 49.1
 
Other current liabilities96.4
 90.6
 
Total current liabilities441.4
 393.0
 
Long-term debt, less current portion372.7
 491.6
 
Accrued pension and other post-retirement benefits, less current portion85.9
 86.1
 
Other liabilities49.5
 36.8
 
Commitments and contingencies (Note 15)
 
 
Stockholders' Equity:    
Preferred stock, $0.01 par value; 20,000,000 shares authorized; no shares issued in 2017 or 2016—
 —
 
Common stock, $0.01 par value; 120,000,000 shares authorized; 2017: 31,623,079 issued, and 31,577,182 outstanding; 2016: 29,316,041 issued and 29,156,847 outstanding0.3
 0.3
 
Common stock held in treasury, at cost; 2017: 45,897; and 2016: 159,194 shares(4.0) (7.2) 
Additional paid-in capital252.2
 77.2
 
Retained earnings333.7
 266.6
 
Accumulated other comprehensive loss(140.3) (157.0) 
Total Stockholders' Equity441.9
 179.9
 
Total Liabilities and Stockholders' Equity$1,391.4
 $1,187.4
 


The accompanying notes are an integral part of the consolidated financial statements.

49

JOHN BEAN TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended December 31, Year Ended December 31,
(In millions)2017 2016 2015 (In millions)202220212020
Cash Flows From Operating Activities:      Cash Flows From Operating Activities:
Net income$80.5
 $67.6
 $55.9
 Net income$130.7 $118.4 $108.8 
Loss from discontinued operations, net1.6
 0.4
 0.1
 
Income from continuing operations82.1
 68.0
 56.0
 
Adjustments to reconcile net income from continuing operations to cash provided by operating activities of continuing operations:      
Adjustments to reconcile net income to cash provided by operating activities:Adjustments to reconcile net income to cash provided by operating activities:
Depreciation29.7
 25.4
 20.0
 Depreciation33.4 34.9 33.8 
Amortization22.0
 13.1
 9.6
 Amortization47.7 41.9 38.0 
Stock-based compensation9.0
 9.9
 7.2
 Stock-based compensation10.2 6.5 1.9 
Pension and other post-retirement benefits expense(0.2) (1.0) (1.4) Pension and other post-retirement benefits expense1.7 0.9 5.9 
Deferred income taxes18.3
 (0.1) 5.8
 Deferred income taxes(25.8)(2.7)9.8 
LIFO expenseLIFO expense8.9 0.9 0.1 
Other(0.4) (0.7) 0.1
 Other8.5 2.8 4.6 
Changes in operating assets and liabilities, net of effects of acquisitions:      
Trade receivables, net(35.8) (29.0) (11.3) 
Changes in operating assets and liabilities:Changes in operating assets and liabilities:
Trade receivables, net and contract assetsTrade receivables, net and contract assets(52.2)(29.2)62.5 
Inventories(23.7) (2.9) 15.6
 Inventories(69.0)(37.9)44.0 
Accounts payable, trade and other8.5
 16.1
 10.4
 Accounts payable, trade and other47.8 39.6 (61.0)
Advance payments and progress billings3.4
 (17.0) 26.9
 
Advance and progress paymentsAdvance and progress payments(8.1)54.9 26.1 
Accrued pension and other post-retirement benefits, net(11.2) (10.5) (14.3) Accrued pension and other post-retirement benefits, net(3.5)(13.1)(12.5)
Other assets and liabilities, net4.6
 (3.4) (12.4) Other assets and liabilities, net12.0 7.8 (10.0)
Cash provided by continuing operating activities106.3
 67.9
 112.2
 
Net cash required by discontinued operating activities(1.7) (0.5) (0.3) 
Cash provided by operating activities104.6
 67.4
 111.9
 Cash provided by operating activities142.3 225.7 252.0 
Cash Flows From Investing Activities:      Cash Flows From Investing Activities:
Acquisitions, net of cash acquired(104.2) (232.0) (150.9) Acquisitions, net of cash acquired(329.7)(224.5)(4.5)
Capital expenditures(37.9) (37.1) (37.7) Capital expenditures(87.6)(54.1)(34.3)
Proceeds from disposal of assets2.2
 2.3
 1.5
 Proceeds from disposal of assets1.2 5.7 1.5 
Proceeds from property available for sale—
 —
 2.0
 
Cash required by investing activities(139.9) (266.8) (185.1) Cash required by investing activities(416.1)(272.9)(37.3)
Cash Flows From Financing Activities:      Cash Flows From Financing Activities:
Net proceeds (payments) on short-term debt(1.0) 0.9
 (1.5) 
Proceeds from short-term foreign credit facilities6.8
 15.3
 —
 
Payments of short-term foreign credit facilities(8.4) (11.0) —
 
Net proceeds (payments) from domestic credit facilities(111.8) 62.4
 184.3
 
Issuance of long-term debt—
 149.5
 —
 
Cash payments to settle private placement debt—
 —
 (75.0) 
Repayment of long-term debt(1.5) (2.0) (1.4) 
Proceeds from stock issuance, net of stock issuance costs184.1
 

 

 
Excess tax benefits—
 1.5
 2.2
 
Net proceeds from short-term debtNet proceeds from short-term debt0.4 (2.5)1.5 
Payment in connection with modification of credit facilitiesPayment in connection with modification of credit facilities— (323.4)— 
Net proceeds (payments) from domestic credit facilities, net of debt issuance costsNet proceeds (payments) from domestic credit facilities, net of debt issuance costs292.3 83.1 (193.9)
Proceeds from issuance of 2026 convertible senior notes, net of issuance costsProceeds from issuance of 2026 convertible senior notes, net of issuance costs— 391.4 — 
Purchase of convertible bond hedge Purchase of convertible bond hedge — (65.6)— 
Proceeds from sale of warrantsProceeds from sale of warrants— 29.5 — 
Settlement of taxes withheld on equity compensation awards(10.5) (2.6) (5.8) Settlement of taxes withheld on equity compensation awards(1.3)(2.2)(2.2)
Purchase of treasury stock(5.0) (4.3) (7.7) 
Common stock repurchasesCommon stock repurchases(7.7)— — 
Dividends(12.7) (11.8) (11.2) Dividends(13.1)(12.8)(12.8)
Deferred acquisition payments(5.3) (3.0) —
 
Cash provided by financing activities34.7
 194.9
 83.9
 
Acquisition date earnout liability and other deferred acquisition paymentsAcquisition date earnout liability and other deferred acquisition payments— (16.7)— 
Cash provided (required) by financing activitiesCash provided (required) by financing activities270.6 80.8 (207.4)
Effect of foreign exchange rate changes on cash and cash equivalents1.4
 0.5
 (6.8) Effect of foreign exchange rate changes on cash and cash equivalents(2.5)(2.3)0.7 
Increase (decrease) in cash and cash equivalents0.8
 (4.0) 3.9
 
(Decrease) increase in cash and cash equivalents(Decrease) increase in cash and cash equivalents(5.7)31.3 8.0 
Cash and cash equivalents, beginning of period33.2
 37.2
 33.3
 Cash and cash equivalents, beginning of period78.8 47.5 39.5 
Cash and cash equivalents, end of period$34.0
 $33.2
 $37.2
 Cash and cash equivalents, end of period$73.1 $78.8 $47.5 
Supplemental Cash Flow Information:      Supplemental Cash Flow Information:
Interest paid$13.1
 $10.4
 $7.7
 Interest paid$14.6 $10.0 $14.2 
Income taxes paid24.0
 25.8
 13.8
 Income taxes paid43.6 44.3 36.4 
Non-cash investing in capital expenditures, accrued but not paidNon-cash investing in capital expenditures, accrued but not paid11.8 9.3 — 
Acquisition - deferred consideration (non-cash)13.8
 12.0
 —
 Acquisition - deferred consideration (non-cash)— — 2.2 
The accompanying notes are an integral part of the consolidated financial statements.

50

JOHN BEAN TECHNOLOGIES CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
(In millions)Common StockCommon Stock
Held in Treasury		Additional Paid-In CapitalRetained EarningsAccumulated Other Comprehensive Income(Loss)Total Equity
December 31, 2019$0.3 $(12.6)$241.8 $532.8 $(192.8)$569.5 
Net income— — — 108.8 — 108.8 
Issuance of treasury stock— 11.6 (11.6)— — — 
Common stock cash dividends, $0.40 per share— — — (12.8)— (12.8)
Foreign currency translation adjustments, net of income taxes of $1.9— — — — (8.8)(8.8)
Derivatives designated as hedges, net of income taxes of $1.4— — — — (3.9)(3.9)
Pension and other post-retirement liability adjustments, net of income taxes of $5.2— — — — (14.4)(14.4)
Stock-based compensation expense— — 1.9 — — 1.9 
Taxes withheld on issuance of stock-based awards— — (2.2)— — (2.2)
Adoption of ASC 326— — — (1.0)— (1.0)
December 31, 20200.3 (1.0)229.9 627.8 (219.9)637.1 
Net income— — — 118.4 — 118.4 
Issuance of treasury stock— 1.0 (1.0)— — — 
Common stock cash dividends, $0.40 per share— — — (12.8)— (12.8)
Foreign currency translation adjustments, net of income taxes of $(1.6)— — — — 1.0 1.0 
Derivatives designated as hedges, net of income taxes of $(2.0)— — — — 5.6 5.6 
Pension and other post-retirement liability adjustments, net of income taxes of $(5.5)— — — — 15.9 15.9 
Proceeds from sale of warrants— — 29.5 — — 29.5 
Purchase of convertible bond hedge, net of income tax of $17.1— — (48.5)— — (48.5)
Stock-based compensation expense— — 6.5 — — 6.5 
Taxes withheld on issuance of stock-based awards— — (2.2)— — (2.2)
December 31, 20210.3 — 214.2 733.4 (197.4)750.5 
Net income— — — 130.7 — 130.7 
Issuance of treasury stock— 2.4 (2.4)— — — 
Share repurchases— (7.7)— — — (7.7)
Common stock cash dividends, $0.40 per share— — — (12.8)— (12.8)
Foreign currency translation adjustments, net of income taxes of $(1.2)— — — — (34.5)(34.5)
Derivatives designated as hedges, net of income taxes of $(4.6)— — — — 13.0 13.0 
Pension and other post-retirement liability adjustments, net of income taxes of $(4.6)— — — — 14.6 14.6 
Stock-based compensation expense— — 10.2 — — 10.2 
Taxes withheld on issuance of stock-based awards— — (1.3)— — (1.3)
December 31, 2022$0.3 $(5.3)$220.7 $851.3 $(204.3)$862.7 
(In millions)Common Stock 
Common Stock
Held in Treasury
 Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income(Loss) Total Equity 
December 31, 2014$0.3
 $(1.5) $71.1
 $166.4
 $(117.1) $119.2
 
Net income—
 —
 —
 55.9
 —
 55.9
 
Issuance of common stock—
 3.1
 (3.1) —
 —
 —
 
Taxes withheld on issuance of stock-based awards—
 —
 (5.8) —
 —
 (5.8) 
Excess tax benefits on stock-based payment arrangements—
 —
 2.2
 —
 —
 2.2
 
Dividends on stock-based payment arrangements—
 —
 —
 (0.4) —
 (0.4) 
Common stock cash dividends—
 —
 —
 (10.8) —
 (10.8) 
Share repurchases—
 (7.7) —
 —
 —
 (7.7) 
Foreign currency translation adjustments—
 —
 —
 —
 (21.9) (21.9) 
Derivatives designated as hedges, net of income taxes of $0.6—
 —
 —
 —
 (0.8) (0.8) 
Pension and other post-retirement liability adjustments, net of income taxes of $5.5—
 —
 —
 —
 (7.4) (7.4) 
Stock-based compensation expense—
 —
 7.2
 —
 —
 7.2
 
December 31, 20150.3
 (6.1) 71.6
 211.1
 (147.2) 129.7
 
Net income—
 —
 —
 67.6
 —
 67.6
 
Issuance of common stock—
 3.2
 (3.2) —
 —
 —
 
Taxes withheld on issuance of stock-based awards—
 —
 (2.6) —
 —
 (2.6) 
Excess tax benefits on stock-based payment arrangements—
 —
 1.5
 —
 —
 1.5
 
Dividends on stock-based payment arrangements—
 —
 —
 (0.4) —
 (0.4) 
Common stock cash dividends—
 —
 —
 (11.7) —
 (11.7) 
Share repurchases—
 (4.3) —
 —
 —
 (4.3) 
Foreign currency translation adjustments—
 —
 —
 —
 (5.7) (5.7) 
Derivatives designated as hedges, net of income taxes of $0.4—
 —
 —
 —
 0.7
 0.7
 
Pension and other post-retirement liability adjustments, net of income taxes of $(1.8)—
 —
 —
 —
 (4.8) (4.8) 
Stock-based compensation expense—
 —
 9.9
 —
 —
 9.9
 
December 31, 20160.3
 (7.2) 77.2
 266.6
 (157.0) 179.9
 
Net income—
 —
 —
 80.5
 —
 80.5
 
Issuance of treasury stock—
 8.2
 (8.2) —
 —
 —
 
Issuance of common stock—
 —
 184.1
 —
 —
 184.1
 
Taxes withheld on issuance of stock-based awards—
 —
 (10.5) —
 —
 (10.5) 
Dividends on stock-based payment arrangements—
 —
 —
 (0.4) —
 (0.4) 
Common stock cash dividends—
 —
 —
 (12.4) —
 (12.4) 
Share repurchases—
 (5.0) —
 —
 —
 (5.0) 
Foreign currency translation adjustments—
 —
 —
 —
 20.5
 20.5
 
Derivatives designated as hedges, net of income taxes of $0.9—
 —
 —
 —
 1.5
 1.5
 
Pension and other postretirement liability adjustments, net of income taxes of ($1.7)—
 —
 —
 —
 (5.3) (5.3) 
Cumulative adjustment - Change in accounting policy ASU 2016-09—
 —
 0.6
 (0.6) —
 —
 
Stock-based compensation expense—
 —
 9.0
 —
 —
 9.0
 
December 31, 2017$0.3
 $(4.0) $252.2
 $333.7
 $(140.3) $441.9
 


The accompanying notes are an integral part of the consolidated financial statements.

51

JOHN BEAN TECHNOLOGIES CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Consolidation


The consolidated financial statements include the accounts of John Bean Technologies Corporation (JBT, we, or the Company) and all wholly-owned subsidiaries. All intercompany investments, accounts, and transactions have been eliminated.


Use of estimates


Preparation of financial statements that follow accounting principles generally accepted in the U.S. (U.S. GAAP)GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.


Cash and cash equivalents


Cash and cash equivalents consist of cash and highly liquid investments with original maturities of three months or less.


Allowance for credit losses

The Company adopted ASC 326, Measurement of Credit Losses on Financial Instruments, as of January 1, 2020 with the cumulative-effect transition method with the required prospective approach. The measurement of expected credit losses under the Current Expected Credit Loss ("CECL") methodology is applicable to financial assets measured at amortized cost, which includes trade receivables, contract assets, and non-current receivables. An allowance for credit losses under the CECL methodology is determined using the loss rate approach and measured on a collective (pool) basis when similar risk characteristics exist. Where financial instruments do not share risk characteristics, they are evaluated on an individual basis. The CECL allowance is based on relevant available information, from internal and external sources, relating to past events, current conditions, and reasonable and supportable forecasts. The allowance for credit losses as of December 31, 2022 and 2021 was $8.0 million and $6.0 million, respectively.

Inventories


Inventories are stated at the lower of cost or net realizable value, which includes an estimate for excess and obsolete inventories. Inventory costs include those costs directly attributable to products, including all manufacturing overhead but excluding costs to distribute. Cost is determined on the last-in, first-out (“LIFO”) basis for allcertain of our domestic inventories, exceptinventories. We exclude certain inventories relating to construction-typeover time contracts, which are stated at the actual production cost incurred to date, reduced by the portion of these costs identified with revenue recognized. The first-in, first-out (“FIFO”) method is used to determine the cost for all other inventories.


Property, plant, and equipment


Property, plant, and equipment are recorded at cost. Depreciation for financial reporting purposes is provided principally on the straight-line basis over the estimated useful lives of the assets (land improvements—20 to 35 years; buildings—20 to 50 years; and machinery and equipment—3 to 20 years). Gains and losses are reflected in otherthe Selling, general and administrative expense net on the consolidated statementsConsolidated Statements of incomeIncome upon the sale or retirement of assets. Expenditures that extend the useful lives of property, plant, and equipment are capitalized and depreciated over the estimated new remaining life of the asset. Leasehold improvements are recorded at cost and depreciated over the standard life of the type of asset or the remaining life of the lease, whichever is shorter.


Capitalized software costs


Other assets include the capitalized cost of internal useWe capitalize costs incurred to purchase software (including Internet web sites). The assets are stated at cost less accumulated amortization and were $16.7 million and $12.3 million at December 31, 2017 and 2016, respectively. These software costs include the amount paid for purchases of software andor internal and external costs incurred during the application development stage of software projects. These costs are amortized on a straight-line basis over the estimated useful lives of the assets. For internal usecapitalized software, the useful lives range from three to ten years. For Internet web site

We capitalize costs incurred with the estimated useful lives do not exceed three years.implementation of a cloud computing arrangement that is a service contract, consistent with our policy for software developed or obtained for internal use.

52

Goodwill


We testThe Company tests goodwill for impairment annually during the fourth quarter and whenever events occur or changes in circumstances indicate that impairment may have occurred. Impairment testing is performed for each of ourthe Company's reporting units by first assessing qualitative factors to see if further testing of goodwill is required. Qualitative factors may include, but are not limited to economic conditions, industry and market considerations, cost factors, overall financial performance of the reporting units and other entity and reporting unit specific events. If we concludethe Company concludes that it is more likely than not that a reporting unit’s fair value is less than its carrying amount based on ourthe qualitative assessment, then a quantitative test is required. WeThe Company may also choose to bypass the qualitative assessment and perform the quantitative test. In performing the quantitative test, we determinethe Company determines the fair value of a reporting unit using the “income approach” valuation method. We useThe Company uses a discounted cash flow model in which cash flows anticipated over several periods, plus a terminal value at the end of that time horizon, are discounted to their present value using an appropriate cost of capital rate. Judgment is required in developing the assumptions for the discounted cash flow model. These assumptions include revenue growth rates, profit margin percentages, discount rates, perpetuity growth rates, future capital expenditures, and working capital requirements, among others. If the estimated fair value of a reporting unit exceeds its carrying value, we considerthe Company considers that goodwill is not impaired. If the carrying value exceeds estimated fair value, there is an indication of potential impairment, and an

impairment loss is recorded. We calculateimpaired.The Company calculates the impairment loss by comparing the fair value of the reporting unit less its carrying amount, including goodwill. Impairmentgoodwill, and would be limited to the carrying value of the goodwill.


WeThe Company completed ourits annual goodwill impairment test as of October 31, 20172022 using a quantitativequalitative assessment approach. As a result of this assessment we notedthe Company concluded that it is more likely than not that the fair value of each reporting unit exceeds its carrying value, and therefore weit determined that none of ourits goodwill was impaired. Similar conclusions were reached as of October 31, 2021 and 2020.


Acquired intangible assets


Our acquired intangibleIntangible assets with finite useful lives are being amortizedsubject to amortization on a straight-line basis over their estimated useful lives,the expected period of economic benefit, which range from less than 1 year4 years to 1524 years. WeThe Company evaluates whether events or circumstances have determinedoccurred that warrant a revision to the trade names for our 2017 and 2016 acquired businessesremaining useful lives of Avure, Tipper Tie, C.A.T. and PLF have indefinite lives.intangible assets. In cases where a revision is deemed appropriate, the remaining carrying amounts of the intangible assets are amortized over the revised remaining useful life.


The carrying values of intangible assets with indefinite lives are reviewed for recoverability on an annual basis, and whenever events occur or changes in circumstances indicate that impairment may have occurred. The facts and circumstances considered include an assessment of the recoverability of the cost of intangible assets from future cash flows to be derived from the use of the asset. It is not possible for us to predict the likelihood of any possible future impairments or, if such an impairment were to occur, the magnitude of any impairment. However, any potential impairment would be limited to the carrying value of the indefinite-lived intantigibleintangible asset.


IntangibleFor intangible assets with finite usefulindefinite lives, are subject to amortization over the expected period of economic benefit to us. We evaluateCompany also evaluates whether events or circumstances have occurred that warrant a revision to the remainingof their useful lives of intangible assets.from an indefinite life to finite useful life. In cases where a revision is deemed appropriate, the remaining carrying amounts of thesuch intangible assets are amortized over the revised remainingfinite useful life.


The Company completed its annual evaluation for impairment of all indefinite-lived intangible assets as of October 31, 2022, which did not result in any impairment. Similar conclusions were reached as of October 31, 2021 and 2020.

Impairment of long-lived assets


Our long-livedLong-lived assets other than goodwill and acquired indefinite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the long-lived asset may not be recoverable. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If it is determined that an impairment loss has occurred, the loss is measured as the amount by which the carrying amount of the long-lived asset exceeds its fair value.


Revenue recognition

Refer toWe have evaluated the Recently Issued Accounting Standards Not Yet Adopted section below for discussion of the impacts to revenue recognition resulting from the new revenue guidance effective January 1, 2018. The following discussion focuses on the revenue recognition methodology in placecurrent environment as of December 31, 2017.

For most2022 and the year then ended and have concluded there is no event or circumstance that has caused an impairment of our products we recognizelong-lived assets. We will continue to monitor the environment to determine whether the impacts to the Company represent an event or change in circumstances that may trigger a need to assess for useful life revision or impairment.

Revenue recognition

Revenue is measured based on consideration specified in a contract with a customer, and excludes any sales incentives and amounts collected on behalf of third parties when the Company is acting in an agent capacity. The Company recognizes revenue when the following criteria are met: we have an agreement with the customer, theit satisfies a performance obligation by transferring control of a product has been deliveredor service to a customer.
53


Performance Obligations & Contract Estimates

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer, the salescustomer. A contract’s transaction price is fixedallocated to each distinct performance obligation based on its respective stand-alone selling price and recognized as revenue when, or determinable and collectability is reasonably assured.

Each customer arrangement is evaluated to determine the presence of multiple deliverables. For multiple-element revenue arrangements, such as, the saleperformance obligation is satisfied. A large portion of revenue across the Company is derived from manufactured equipment, which may be customized to meet customer specifications.

The Company's contracts with customers in both segments often include multiple promised goods and/or services. For instance, a contract may include equipment, installation, optional warranties, periodic service agreement, we allocatecalls, etc. The Company frequently has contracts for which the contract valueequipment and installation are considered a single performance obligation. In these instances the installation services are not separately identifiable as the installation goes above and beyond the basic assembly, set-up and testing and therefore significantly customizes or modifies the equipment. However, the Company also has contracts where the installation services are deemed to the various elements based on relative selling price for each element and recognize revenue consistent withbe separately identifiable as the nature of these services are considered basic assembly, set-up and testing, and are therefore deemed to be a separate performance obligation. This generally occurs in contracts where the Company manufactures standard equipment.

When a performance obligation is separately identifiable, as defined in ASC 606, Revenue from Contracts with Customers, the Company allocates a portion of the contract price to the obligation and recognizes it separately from the other performance obligations. Contract price allocation among multiple performance obligations is based on the relative standalone selling price of each deliverable.distinct good or service in the contract. When not sold separately, an estimate of the standalone selling price is determined using expected cost plus a reasonable margin.


OurThe timing of revenue recognition for each performance obligation is either over time as control transfers or at a point in time. The Company recognizes revenue over time for contracts that provide service over a period of time, for refurbishments of customer-owned equipment, and for highly customized equipment for which the Company has a contractual, enforceable right to collect payment upon customer cancellation for performance completed to date. Revenue generated from standard agreements generally do not include customer acceptance provisions. However, if there is a customer-specific acceptance provision, the associated revenue is deferred until we have satisfied the acceptance provision.

Certain of our productequipment, highly customized equipment contracts without an enforceable right to payment for performance completed to date, as well as aftermarket parts and services sales, are generated from construction-type contractsrecognized at a point in time.

The Company utilizes the input method of “cost-to-cost” to recognize product revenue over time. The Company measures progress based on costs incurred to date relative to total estimated cost at completion. Incurred cost represents work performed, which corresponds with, and therefore depicts, the transfer of control to the customer. Contract costs include labor, material, and certain allocated overhead expense. Material costs are considered incurred, and therefore included in the cost-to-cost measure of progress, when they are used in manufacturing and therefore customize the asset. Cost estimates are based on assumptions and estimates to project the outcome of future events; including the estimated labor and material costs required to complete open projects. During the year, we recognized $740.7 million in revenue for over time projects using the cost-to-cost method.

Revenue attributable to equipment which qualifies as point in time is recognized when customers take control of the asset. For equipment where installation is separately identifiable, the Company generally determines that control transfers when the customer has obtained legal title and the risks and rewards of ownership, which is dependent upon the shipping terms within the contract. For customized equipment where installation is not separately identifiable, but where the Company does not have an enforceable right to payment for performance completed to-date, it defines control transfer as the point in time in which it is able to objectively verify that the customer has the capability of full use of the asset as intended per the contract as this is when control is considered to have passed to the customer. Service revenue is recognized underover time either proportionately over the percentage of completion method. Under this method, revenue is recognized as work progresses on each contract. However, revenue recognition does not begin until a substantial portionperiod of the labor hoursunderlying contract or when services are incurred to ensure that revenue is not recognized based solely upon materials procurement. Depending uponcomplete, depending on the product, we measure progress using an input method, such as costs incurred, or an output method, such as units completed or milestones achieved. terms of the arrangement.

Any expected losses for a contract are charged to earnings, in total, in the period thesuch losses are identified.


ProgressThe Company generally bills customers in advance, and progress billings generally are issued upon the completion of certain phases of the work as stipulated in the contract. RevenueThe Company may extend credit to customers in excessline with industry standards where it is strategically advantageous.

Within the AeroTech segment, maintenance and repair service for baggage handling systems, facilities, gate systems, and ground support equipment is provided. The timing of progresscontract billings on contracts amounted to $90.6 million and $63.0 million at December 31, 2017 and 2016, respectively. These unbilled receivables are reported in trade receivables onis concurrent with the consolidated balance sheets. Progress billings and cash collections in excess of revenue recognized on a contract are classified as advance and progress payments on the consolidated balance sheets. All

unbilled trade payables are accrued in other current liabilities when revenue is recognized. Unbilled trade payables were $13.3 million and $8.3 million at December 31, 2017 and 2016, respectively.

Service revenue is recognized either when performance is complete or proportionately over the periodcompletion of the underlying contract, depending onservices, and therefore the termsCompany has availed itself of the arrangement.

Some of our operating leasepractical expedient that allows it to recognize revenue is earned from full-service leases forcommensurate with the amount to which we are paid annual fixed rates plus, in some cases, an additional amount based on production volumes. Revenue from production volumes is recognized when determinable and collectible.

We provide an allowance for doubtful accounts on trade receivables equalit has a right to invoice, which corresponds directly to the estimated uncollectible amounts. This estimate is based on historical collection experience and a specific reviewvalue to the customer of each customer’s trade receivable balance.performance completed to date.


54

Research and Developmentdevelopment


The objectives of ourthe research and development programs are to create new products and business opportunities in relevant fields, and to improve existing products. Research and development costs are expensed as incurred. Research and development expense of $29.4 million, $29.9 million, and $29.3 million for 2022, 2021 and 2020, respectively, is recorded in selling, general and administrative expense.


Income taxes


IncomeThe Company’s provision for income taxes are provided on income reportedincludes amounts payable or refundable for financial statement purposes, adjustedthe current year, the effects of deferred taxes and impacts from uncertain tax positions, if applicable. We establish deferred tax liabilities or assets for permanenttemporary differences between financial statementand tax reporting basis and incomesubsequently adjust them to reflect changes in tax regulations. Deferredrates expected to be in effect when the temporary differences reverse. We record a valuation allowance reducing deferred tax assets and liabilities are measured using enacted tax rates, and reflect the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities. A valuation allowance is established whenever management believes thatwhen it is more likely than not that deferred taxsuch assets maywill not be realizable.realized. Valuation allowances are evaluated periodically and may be subject to change in future reporting periods.


A liability forWe recognize tax benefits in our financial statements from uncertain tax positions is recorded whenever management believesonly if it is more likely than not likely that the tax position will be sustained based on examination based solely on itsthe technical merits.merits of the position. The amount we recognize is measured as the largest amount of benefit that is greater than 50 percent likely of being realized upon resolution. Future changes related to the expected resolution of uncertain tax positions could affect tax expense in the period when the change occurs. Interest and penalties related to underpayment of income taxes are classified as income tax expense.


Income taxes are not provided on undistributed earningsWe monitor for changes in tax laws and reflect the impacts of foreign subsidiaries or affiliatestax law changes in the period of enactment. When there is refinement to tax law changes in subsequent periods, we account for the new guidance in the period when it is management’s intention that such earnings will remain invested in those companies. Taxes are provided on such earnings in the year in which the decision is made to repatriate the earnings.becomes known.


Stock-based employee compensation


We measureThe Company measures compensation cost on restricted stock awards based on the market price of our common stock at the grant date and the number of shares awarded. The compensation cost for each award is recognized ratably over the lesser of the stated vesting period or the period until the employee becomes retirement eligible, after taking into account forfeitures.


Foreign currency


Financial statements of operations for which the U.S. dollar is not the functional currency are translated to the U.S. dollar prior to consolidation. Assets and liabilities are translated at the exchange rate in effect at the balance sheet date, while income statement accounts are translated at the average exchange rate for each period. For these operations, translation gains and losses are recorded as a component of accumulated other comprehensive loss in stockholders’ equity until the foreign entity is sold or liquidated.


Derivative financial instruments


Derivatives are recognized in the consolidated balance sheets at fair value, with classification as current or non-current based upon the maturity of the derivative instrument. We doThe Company does not offset fair value amounts for derivative instruments held with the same counterparty. Changes in the fair value of derivative instruments are recorded in current earnings or deferred in accumulated other comprehensive loss, depending on the type of hedging transaction and whether a derivative is designated as, and is effective as, a hedge.


In the consolidated statementsConsolidated Statements of income,Income, earnings from foreign currency derivatives related to sales and remeasurement of sales-related assets, liabilities and contracts are recorded in revenue, while earnings from foreign currency derivatives related to purchases and remeasurement of purchase-related assets, liabilities and contracts are recorded in cost of products. Earnings from foreign currency derivatives related to cash management of foreign currencies throughout the world and remeasurement of cash are recorded in other expense, net.selling, general and administrative expenses.



When hedge accounting is applied, we ensurethe Company ensures that the derivative is highly effective at offsetting changes in anticipated cash flows of the hedged item or transaction. Changes in fair value of derivatives that are designated as cash flow hedges are deferred in accumulated other comprehensive income (loss) until the underlying transactions are recognized in earnings. At such time, related deferred hedging gains or losses are also recorded in earnings on the same line as the hedged item. Effectiveness is assessed at the inception of the hedge and on a quarterly basis. Effectiveness of forward contract cash flow hedges is assessed solely on changes in fair value attributable tohedge. The Company documents the change in the spot rate. The change in the fair value of the contract related to the change in forward rates is excluded from the assessment of hedge effectiveness. Changes in this excluded component of the derivative instrument, along with any ineffectiveness identified, are recorded in earnings as incurred. We document our risk management strategy and method for assessing hedge effectiveness at the inception of and throughout the term of each hedge.


The Company's cross-currency swap agreements synthetically swap U.S. dollar denominated fixed rate debt for Euro denominated fixed rate debt and are designated as net investment hedges for accounting purposes. The gains or losses on these derivative instruments are included in the foreign currency translation component of other comprehensive income until the net investment is sold,
55

diluted, or liquidated. Interest payments received for the cross currency swaps are excluded from the net investment hedge effectiveness assessment and are recorded in interest expense, net on the Consolidated Statements of Income.

For derivatives with components excluded from the assessment of hedge effectiveness, the accumulated gains or losses recorded in accumulated other comprehensive income (loss) on such excluded components in a qualifying cash flow or net investment hedging relationship are reclassified to earnings on a systematic and rational basis over the hedge term.

Cash flows from derivative contracts are reported in the consolidated statements of cash flows in the same categories as the cash flows from the underlying transactions.


Leases

Lessee accounting

The Company leases office space, manufacturing facilities and various types of manufacturing and data processing equipment. Leases of real estate generally provide that the Company pays for repairs, property taxes and insurance. At the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on whether the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Leases are classified as operating or finance leases at the commencement date of the lease. Operating leases are included in operating lease right of use ("ROU") assets, other current liabilities, and operating lease liabilities in the consolidated Balance Sheet, which are reported within other assets, other current liabilities and other liabilities, respectively. Lease liabilities are classified between current and long-term liabilities based on their payment terms. The ROU asset balance for finance leases is included in property, plant, and equipment, net in the Balance Sheet. In accordance with the standard, the Company has elected not to recognize leases with terms of less than one year on the Balance Sheet.

ROU assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent an obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the implicit rate is generally not readily determinable for most of its leases, the Company uses its incremental borrowing rate at commencement date in determining the present value of lease payments. We determined the incremental borrowing rate for all leases, based on the rate of interest that the Company would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term. The Company used an unsecured borrowing rate and risk-adjusted that rate to approximate a collateralized rate. The operating lease ROU asset also includes prepaid rent and reflects the unamortized balance of lease incentives. Lease expense for operating leases is recognized on a straight-line basis over the lease term.

The Company elected the practical expedient to not separate lease and non-lease components for leases other than leases of vehicles and communication equipment. For the asset categories of real estate, manufacturing, office and IT equipment, the Company accounts for the lease and non-lease components as a single lease component.

The Company's leases may include renewal and termination options, which are included in the lease term if the Company concludes that it is reasonably certain that it will exercise the option. Some leases give the option to renew, with renewal terms that may extend the lease term. The exercise of lease renewal options is at the Company's sole discretion. Certain leases also include options to purchase the leased property. The depreciable life of the ROU assets are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Our lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes or other costs. Variable lease costs are expensed as incurred on the Consolidated Statements of Income.

The Company's lease agreements do not contain any material residual value guarantees.

Lessor accounting

The Company leases certain FoodTech equipment primarily, such as high capacity industrial extractors, to customers.

In most instances, the Company includes maintenance as a component of the lease agreement. Lease accounting requires lessors to separate lease and non-lease components and further defines maintenance as a non-lease component. The Company elected to exercise the available practical expedient of combining lease and non-lease components where the components meet both of the following criteria:

•The timing and pattern of transfer to the lessee of the lease and non-lease component are the same, and
•The lease component, if accounted for separately, would be classified as an operating lease.
56


As such, the leased asset and its respective maintenance component will not be accounted for separately.

In certain leases, consumables are included as a non-lease component. For these leases, the components do not qualify for the practical expedient as the timing and pattern of transfer to the lessee are not the same. In these instances, the non-lease component will be accounted for in accordance with ASC 606.

The Company monitors the risk associated with residual value of its leased assets. It reviews on an annual basis or more often as deemed necessary, and adjusted residual values and useful lives of equipment leased to outside parties, as appropriate. Adjustments to residual values result in an adjustment to depreciation expense. The Company's annual review is based on a long-term view considering historical market price changes, market price trends, and expected life of the equipment.

Lease agreements with the Company's customers do not contain any material residual value guarantees. Certain lease agreements include terms and conditions resulting in variable lease payments. These payments typically rely upon the usage of the underlying asset.

Certain lease agreements provide renewal options, including some leases with an evergreen renewal option. The exercise of the lease renewal option is at the sole discretion of the lessee. In most instances, the lease can only be terminated in cases of breach of contract. In these instances, termination fees do not apply. Certain lease agreements also allow the lessee to purchase the leased asset at fair market value or a specific agreed upon price. The exercise of the lease purchase option is at the sole discretion of the lessee.

Recently Adopted Accounting Standards


In July 2015,In November 2021, the FASB issued ASU No. 2015-11, Inventory2021-10, Government Assistance (Topic 330) – Simplifying the Measurement of Inventory. The core principle of the ASU is832): Disclosures by Business Entities about Government Assistance. This update requires annual disclosures about transactions with a government that entities that historically used the lower of costare accounted for by applying a grant or market in the subsequent measurement of inventory will instead be required to measure inventory at the lower of cost and net realizable value. The guidance will not change U.S. GAAP for inventory measured using LIFO or the retail inventory method. The ASUcontribution accounting model by analogy. This standard is effective for annual reporting periods, including interim periods within those annual periods,fiscal years beginning after December 15, 2016. This guidance became effective for us as of January 1, 20172021 and there was no effect on our consolidated financial statements and related disclosures.

In March 2016, the FASB issued ASU No. 2016-09, Stock Compensation (Topic 718) - Improvements to Employee Share-Based Payment Accounting. The new guidance was developed as part of the FASB’s simplification initiative. The core principle of the ASU requires income tax effects of awards toshould be recognized in the income statement when the awards vestapplied either prospectively or are settled, and eliminates the requirement to report excess tax benefits in additional paid-in capital (APIC pool). It also allows an employer to repurchase more of an employee’s shares for tax withholding purposes without triggering liability accounting, and allows an employer to make a policy election to account for forfeitures as they occur. The new standard became effective for us as of January 1, 2017. During 2017, 296,608 awards vested, and resulted in a $6.4 million tax benefit reported in earnings, and is classified as an operating activity within the condensed consolidated Statements of Cash Flows. The elimination of the APIC pool affects the treasury stock method used to calculate weighted average shares outstanding; however, the impact was not material. We elected to change our policy surrounding forfeitures, and beginning January 2017 we no longer estimate the number of awards expected to be forfeited but rather account for them as they occur. We are required to implement this portion of the guidance using a modified retrospective approach, and as such have recorded a cumulative adjustment of $0.6 million in retained earnings as of January 1, 2017.

We also amended our incentive compensation and stock plan to allow JBT to have the discretion to withhold up to the maximum statutory rates, on an individual tax basis. A liability was not established as the withholding limits do not exceed the maximum. Cash paid for tax withholdings are classified as financing activity on the condensed consolidated Statement of Cash Flows, consistent with prior years.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230) Classification of Certain Cash Receipts and Cash Payments and Restricted Cash. The new guidance is intended to reduce the existing diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. The core principle of the ASU requires the classification of eight specific cash flow issues identified under ASC 230 to be presented as either financing, investing or operating, or some combination thereof, depending upon the nature of the issue. Entities are required to use a retrospective transition approach for all of the issues identified for each period presented.retrospectively. The Company adopted the new ASU prospectively as of September 30, 2017. There was noDecember 31, 2022. The adoption did not have a material impact on our consolidated financial statements and related disclosures as a result of adopting the ASU.Company's disclosures.


In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) - Clarifying the Definition of a Business. The core principle of the ASU is to clarify the definition of a business to require certain transactions to be accounted for as business combinations versus an acquisition of assets. The Company adopted the new ASU as of September 30, 2017. There was no impact on our consolidated financial statements and related disclosures as a result of adopting the ASU.
57
In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350) - Simplifying the Test for Goodwill Impairment. The new guidance will simplify the accounting for goodwill impairment. The core principle of the ASU is to remove the requirement to calculate an implied fair value to determine impairment (Step 2 of the goodwill impairment test) and allow instead for goodwill impairment to equal the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The Company early adopted the new ASU as of September 30, 2017, prior to our 2017 annual testing of goodwill impairment, to be performed as of October 31st. There was no impact on our consolidated financial statements and related disclosures as a result of adopting the ASU.


In May 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (ASC 718) - Scope of Modification Accounting. The amendments provide guidance as to how an entity should account for a change in the terms and conditions of its share-based payment awards. The core principle of the ASU is to provide clarity, and reduce the variation in applied practice, as well as, cost and complexity in accounting for a change in the terms and conditions in an entity's share-based payment awards. The Company adopted the new ASU as of September 30, 2017. There was no impact on our consolidated financial statements and related disclosures as a result of adopting the ASU.

Recently Issued Accounting Standards Not Yet Adopted

Beginning in 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), plus a number of related ASU’s designed to clarify and interpret Topic 606. The new standard will replace most existing revenue recognition guidance in U.S. GAAP. The core principle of the ASU requires companies to reevaluate when revenue is recorded based upon newly defined criteria, either at a point in time or over time as goods or services are delivered. The ASU requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and estimates, and changes in those estimates. The new standard became effective for us as of January 1, 2018. As previously disclosed, we will adopt Topic 606 on a modified-retrospective basis.

In 2017, we completed our gap assessment and determined that in certain contracts, we will qualify for over time recognition for our manufactured equipment that is highly engineered to unique customer specifications. In addition, we expect that due to the nature of our equipment and installation contracts that we will combine these into one performance obligation. Under Topic 606, revenue recognized for contracts that meet certain criteria will result in revenue being recognized as the equipment is being manufactured which is an acceleration of revenue as compared to our current revenue recognition methodology of recognizing revenue, generally when the equipment is shipped to the customer. This conclusion, specific to equipment contracts for which the equipment is highly engineered to unique customer specifications, is dependent on whether our contract with the customer provides us, upon customer cancellation, with an enforceable right to payment for performance completed to date. Where the contract does not provide explicit language regarding cancellation payments, revenue will be recognized at a point in time, usually upon completion of the installation of the equipment. Therefore, some revenue will be deferred and recognized at a later date. This impacts both equipment contracts with installation that qualify as one performance obligation, and that were previously recognized upon shipment, as well as certain equipment contracts for which revenue was recognized under percentage of completion accounting under legacy GAAP.

We continue to execute our implementation plan and have developed new revenue accounting policies and processes; changed our internal controls over revenue recognition; created pro forma disclosures; and continue to implement system changes and enhancements. We are in the process of evaluating all contracts not completed on January 1, 2018 and have preliminarily determined the net impact of adopting this standard will be a reduction to retained earnings within the range of $25 million to $30 million. This differs significantly from the expected impact previously disclosed and is due solely due to interpretations published subsequent to our previous disclosure regarding what constitutes an enforceable right to payment. For full year 2018 results, we expect the financial statement impact of this deferral will be offset by the requirement to defer revenue on contracts that, under legacy GAAP, would have been recognized in 2018, but will be deferred until 2019 under the new standard. Our assessment of the foregoing is ongoing and subject to finalization, such that the actual impact of the adoption may differ materially from the estimated ranges described above.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The new standard will replace most existing lease guidance in U.S. GAAP. The core principle of the ASU is the requirement for lessees to report a right to use asset and a lease payment obligation on the balance sheet but recognize expenses on their income statements in a manner similar to today’s accounting, and for lessors the guidance remains substantially similar to current U.S. GAAP. The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2018. However, early adoption is permitted. Entities are required to use a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements. We are in the process of evaluating the impact this standard will have on our consolidated financial statements and related disclosures.

In October 2016, the FASB issued ASU 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory. The new guidance is intended to simplify the accounting for intercompany asset transfers. The core principle requires an entity to immediately recognize the tax consequences of intercompany asset transfers. The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2017. However, early adoption is permitted only at the beginning of an annual period for which no financial statements (interim or annual) have already been issued. The Company anticipates the adoption in the effective period and we are currently evaluating the effect, if any, that the ASU will have on our consolidated financial statements and related disclosures.

In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (ASC 715) - Improving the Presentation of Net Periodic Pension Costs and Net Periodic Postretirement Benefit Cost. The new guidance will improve the presentation of pension

cost by providing additional guidance on the presentation of net benefit cost in the income statement and on the components eligible for capitalization in assets. The core principle of the ASU is to provide more transparency in the presentation of these costs by requiring the service cost component to be reported in the same line item as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented separately from the service cost component and outside a subtotal of income from operations. The amendments require that the Consolidated Statements of Income impacts be applied retrospectively, while Balance Sheet changes should be applied prospectively. As such, upon adoption in 2018, the Company expects to revise operating income for fiscal year 2017 by $1.1 million, and report this income in non operating income. Operating income for the fiscal year 2016 will be reduced by $2.3 million and operating income for 2015 will be revised by $0.6 million. There will be no impact to net income or to the Balance Sheet or Statement of Cash Flows.
The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2017. However, early adoption is permitted as of the beginning of an annual period for which financial statements (interim or annual) have not been issued or made available for issuance. The Company will adopt the newly issued ASU as of January 1, 2018.

In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (ASC 815) - Targeted Improvements to Accounting for Hedging Activities. The core of the principle is to simplify hedge accounting, as well as improve the financial reporting of hedging results, for both financial and commodity risks, in the financial statements and related disclosures. The ASU is effective for annual reporting periods, including interim periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted in any interim period after the issuance of the amendment, however, any adjustments should be made as of the beginning of the fiscal year in which the interim period occurred. The Company is currently evaluating the effect, if any, that the ASU will have on our consolidated financial statements and related disclosures.


NOTE 2. ACQUISITIONS


During 20172022 and 20162021, the Company acquired six100% voting equity of two and three businesses, for an aggregate consideration of $354.4 million, net of cash acquired.respectively. A summary of the acquisitions made during the periodperiods is as follows:
DateTypeCompany/Product LineLocationSegment
DateSeptember 1, 2022TypeStockCompany/Product LineBevcorp, LLC ("Bevcorp")LocationEastlake, OhioSegmentFoodTech
July 31, 2017StockPLF International Ltd.Harwich (Sussex), EnglandFoodTech
Manufacturer and leadingA provider of powder filling systems for global food and beverage and nutraceutical markets headquartered in Harwich (Essex), England.
July 3, 2017StockAircraft Maintenance Support Services, Ltd. (AMSS)Mid Glamorgan, EnglandAeroTech
Manufacturer of military and commercial aviation equipment.
February 24, 2017StockAvure Technologies, Inc.Middletown, OHFoodTech
Manufacturer of high pressure processing (HPP) systems. HPP is a cold pasteurization technology that ensures food safety without heat or preservatives, maintaining fresh food characteristics such as flavor and nutritional value, while extending shelf life.
February 17, 2016AssetNovus X-Ray LLCDoylestown, PAFoodTech
Manufacturer of modular X-Ray systems for the automated food inspection industry.
November 1, 2016StockTipper Tie, Inc.Apex, NCFoodTech
Manufacturer of engineered processing and packaging solutions in blending, handling, filling, and related consumables toclosing technologies. The Bevcorp acquisition expands the Company's presence in the ready-to-drink carbonated beverage production market and provides significant cross-selling opportunity in filling and seaming food industry.and beverage applications.
October 14, 2016July 1, 2022AssetStockCooling Applied Technologies, Inc. (C.A.T.Alco-food-machines GmbH & Co. KG ("Alco")Russellville, ARBad Iburg, GermanyFoodTech
A provider of further food processing equipment and production lines for a broad range of food applications. The Alco acquisition extends the Company's capabilities in further processing offerings and strengthens existing full line offerings.
Manufacturer
November 2, 2021StockUrtasun Tecnología Alimentaria S.L ("Urtasun")Navarra, SpainFoodTech
A provider of value-addedfruit and vegetable processing solutions, particularly in the fresh packaged and frozen markets. The Urtasun acquisition extends the Company's capabilities in providing fruit and vegetable processing solutions.
July 2, 2021StockCMS Technology, Inc ("Prevenio")Bridgewater, New JerseyFoodTech
A provider of innovative food safety solutions primarily for the poultry industry.industry as well as produce applications. Prevenio provides a pathogen protection solution through its anti-microbial delivery equipment that enhances food safety and integrity, and creates a safer work environment for its customers and their employees. This acquisition enhances the Company’s recurring revenue portfolio and furthers its investment in solutions that support its customers’ daily operations.
February 28, 2021StockAutoCoding Systems Ltd. ("ACS")Cheshire, U.K.FoodTech
A provider of a central command solution for the integration of packaging process devices. The ACS acquisition extends the Company's capabilities in packaging line equipment and associated devices, including coding and label inspection and verification.
Each acquisition has been accounted for as a business combination. For stock acquisitions, 100% of the equity interests were acquired. Tangible and identifiable intangible assets acquired and liabilities assumed were recorded at their respective estimated fair values. The excess of the consideration transferred over the estimated fair value of the net assets received has been recorded as goodwill. The factors that contributed to the recognition of goodwill primarily relate to acquisition-driven anticipated cost savings and revenue enhancement synergies coupled with the assembled workforce acquired.


The following presents the purchase





58

Purchase price allocation for 2022 and 2021 acquisitions:
(In millions)
Bevcorp(1)
Alco(2)
Urtasun(3)
Prevenio(4)
ACS(5)
Total
Financial assets$20.8 $9.0 $8.8 $8.1 $2.9 $49.6 
Inventories33.1 11.7 3.4 0.2 0.7 49.1 
Property, plant and equipment5.5 0.9 3.2 4.1 — 13.7 
Customer relationship (6)
127.0 9.2 11.0 41.0 3.7 191.9 
Patents and acquired technology (6)
3.8 4.7 6.0 17.5 3.4 35.4 
Trademarks (6)
10.0 3.2 2.2 0.7 0.8 16.9 
Deferred taxes— — (5.7)(15.1)(0.9)(21.7)
Financial liabilities(19.7)(19.9)(7.8)(3.4)(2.9)(53.7)
Total identifiable net assets$180.5 $18.8 $21.1 $53.1 $7.7 $281.2 
Cash consideration paid$293.8 $45.1 $44.2 $173.3 $16.8 $573.2 
Cash acquired5.7 3.9 4.8 3.5 1.1 19.0 
Net consideration$288.1 $41.2 $39.4 $169.8 $15.7 $554.2 
Goodwill (7)
$113.3 $26.3 $23.1 $120.2 $9.1 $292.0 

(1)The purchase accounting for Bevcorp is provisional. The valuation of inventory, customer contract related accruals, intangibles, income tax balances and residual goodwill is not complete. These amounts are subject to adjustment as additional information is obtained within the measurement period (not to exceed 12 months from the acquisition date). During the quarter ended December 31, 2022, the Company made no significant measurement period adjustments for Bevcorp.
(2)During the quarter ended December 31, 2022, the Company refined estimates for financial assets by $(3.2) million, inventory by $(1.0) million, financial liabilities by $2.3 million, and property, plant, and equipment, customer relationship, patents and acquired technology, and the liabilities assumed, based on their estimated values:
  
PLF(1)
 
Avure(2)
 
Tipper Tie(2)
 
C.A.T.(2)
 
Other (3)(1)
 Total
(In millions)            
Financial assets $20.8
 $4.3
 27.8
 $3.3
 $7.8
 $64.0
Inventories 1.0
 14.4
 17.2
 16.4
 2.5
 51.5
Property, plant and equipment 2.2
 4.5
 17.2
 2.9
 2.6
 29.4
Other intangible assets(4)
 17.9
 20.8
 66.3
 48.0
 7.1
 160.1
Deferred taxes (3.4) (3.6) (4.9) —
 (0.7) (12.6)
Financial liabilities (5.5) (10.5) (21.2) (14.9) (4.4) (56.5)
Total identifiable net assets $33.0
 $29.9
 102.4
 $55.7
 $14.9
 $235.9
             
Cash consideration paid $46.1
 $58.9
 160.6
 $78.4
 $15.6
 $359.6
Holdback payments due to seller 5.5
 —
   6.0
 1.9
 13.4
Total consideration 51.6
 58.9
 160.6
 84.4
 17.5
 373.0
Cash acquired 15.5
 —
 2.4
 —
 0.7
 18.6
Net consideration $36.1
 $58.9
 158.2
 $84.4
 $16.8
 $354.4
             
Goodwill $18.6
 $29.0
 58.2
 $28.7
 $2.6
 $137.1


(1)The purchase accounting for these acquisitions is provisional. For PLF and AMSS the valuation of certain working capital balances, intangibles, income tax balances and residual goodwill related to each is not complete. These amounts are subject to adjustment as additional information is obtained within the measurement period (not to exceed 12 months from the acquisition date). During the quarter ended December 31, 2017, we revalued the net assets acquired, and the net consideration, to reflect the accurate foreign currency rate on the date of the acquisition. In addition we increased the cash consideration paid by $0.5 million, reflecting a working capital adjustment required by the purchase agreement.trademarks by immaterial amounts. The impact of these adjustments was reflected as a net increase in goodwill of $1.4 million. These adjustments resulted in an immaterial impact to the consolidated statement of income. All other measurement period adjustments in the quarter and twelve months ended December 31, 2017 were not material.
(2)The amounts shown represent final allocation of the purchase price for these acquisitions. For Avure, during the quarter ended December 31, 2017, we adjusted deferred tax liabilities by ($0.8) million, with an offset to goodwill for the same amount. During the quarter ended September 30, 2017 we refined our estimates of deferred tax assets for Avure by ($1.8) million and deferred tax liabilities by $0.7 million. The impact of these adjustments was reflected as a decrease in goodwill of $1.1 million. During the quarter ended June 30, 2017 we refined our other intangible asset estimates for Avure by $2.6 million, deferred taxes by ($0.7) million and inventory by ($0.7) million. The impact of these adjustments was reflected as a decrease in goodwill of $1.2 million. All adjustments in the year resulted in an immaterial impact to the consolidated statement of income. All other measurement period adjustments in the quarter and twelve months ended December 31, 2017 related to Tipper Tie and Avure were not material.
Of the $137.1 million in goodwill reported, $71.6 million is expected to be tax deductible.

The CAT purchase agreement required an additional payment of $6.0 million in October 2017. This payment was reflected as cash consideration paida net increase in goodwill of $1.4 million, and they resulted in an immaterial impact to the consolidated statement of income. As of December 31, 2022, the valuation of inventory, customer contract related accruals, intangibles, income tax balances and residual goodwill is not complete. These amounts are subject to adjustment as additional information is obtained within the measurement period (not to exceed 12 months from the acquisition date).
(3)The purchase price allocation above. There is a remaining $6.0 million payment due in October 2018.

(3)Other includes Novus and AMSS. The purchase price allocation for AMSS is provisional, refer to Note (1).
(4)The acquired intangible assets with definite lives are being amortized on a straight-line basis over their estimated useful lives, which range from five to nineteen years. The intangible assets acquired in 2017 include customer relationships totaling $14.5 million (10- year weighted average useful life), technology totaling $21.8 million (10-year weighted average useful life). The tradenames for Avure, Tipper Tie, C.A.T. and PLF have been determined to have indefinite lives and are reviewed annually for impairment.

accounting for Urtasun was final as of September 30, 2022. During the twelve monthsquarters ended March 31, 2022, June 30, 2022, and September 30, 2022, the Company made no significant measurement period adjustments for Urtasun.
(4)The purchase accounting for Prevenio was final as of June 30, 2022. During the quarters ended March 31, 2022 and June 30, 2022, the Company made no significant measurement period adjustments for Prevenio.
(5)The purchase accounting for ACS was final as of December 31, 2021.
(6)The acquired intangible assets are amortized on a straight-line basis over their estimated useful lives, which range from four to twenty-four years. The intangible assets acquired in 2022 and 2021 have weighted average useful lives of 22 years for trademarks, 18 years for customer relationship, and 8 years for patents and acquired technology.
(7)The Company expects goodwill of $133.7 million from these acquisitions to be deductible for income tax purposes.
During the year ended December 31, 2017, PLF, AMSS and Avure had revenue and earnings (losses)2022, acquisitions in 2022 generated aggregate revenues of $7.5$53.7 million, and ($0.9) million, $8.9aggregate operating income of $2.0 million.

Acquisition costs recorded in selling, general and administrative expense was $7.0 million and $0.2$8.7 million for the years ended December 31, 2022 and $50.1 million and $1.7 million, respectively.2021.


59

NOTE 3. INVENTORIES


Inventories as of December 31, consisted of the following:

(In millions)20222021
Raw materials$123.5 $101.0 
Work in process77.7 59.1 
Finished goods212.6 151.8 
Gross inventories before LIFO reserves and valuation adjustments413.8 311.9 
LIFO reserves(62.0)(53.3)
Valuation adjustments(29.3)(29.5)
Net inventories$322.5 $229.1 
(In millions)2017 2016
Raw materials$72.6
 $62.9
Work in process73.7
 57.3
Finished goods109.2
 86.2
Gross inventories before LIFO reserves and valuation adjustments255.5
 206.4
LIFO reserves and valuation adjustments(65.3) (66.8)
Net inventories$190.2
 $139.6


Inventories accounted for under the LIFO method totaled $124.2$200.2 million and $119.1$153.7 million at December 31, 20172022 and 2016,2021, respectively. The current replacement costs of LIFO inventories exceeded their recorded values by $48.9 million at December 31, 2017 and $47.9 million at December 31, 2016.

NOTE 4. PROPERTY, PLANT AND EQUIPMENT


Property, plant and equipment as of December 31, consisted of the following:

(In millions)20222021
Land and land improvements$20.2 $21.6 
Buildings136.7 138.6 
Machinery and equipment436.8 426.2 
Construction in process22.6 20.4 
616.3 606.8 
Accumulated depreciation(346.4)(339.2)
Property, plant and equipment, net$269.9 $267.6 

NOTE 5. OTHER ASSETS

Other assets as of December 31, consisted of the following:
(In millions)20222021
Capitalized software$87.0 $40.6 
Cloud computing arrangement implementation costs7.3 5.9 
Other97.1 81.2 
Total other assets$191.4 $127.7 

As of December 31, 2022 and 2021, capitalized software costs consisted of deferred costs of $127.0 million and $76.5 million, respectively and associated accumulated amortization of $40.0 million and $35.9 million, respectively. Capitalized software amortization expense was $4.5 million, $3.7 million, and $3.4 million for 2022 and 2021, and 2020, respectively.

As of December 31, 2022 and 2021, cloud computing arrangement implementation costs consisted of deferred costs of $13.0 million and $10.1 million, respectively and associated accumulated amortization of $5.7 million and $4.2 million, respectively. Amortization expense related to cloud computing arrangement implementation costs was $1.3 million, $1.6 million, and $0.9 million for 2022, 2021, and 2020, respectively.
60
(In millions)2017 2016 
Land and land improvements$17.2
 $14.7
 
Buildings101.5
 92.7
 
Machinery and equipment366.5
 326.0
 
Construction in process21.1
 14.8
 
 506.3
 448.2
 
Accumulated depreciation(273.3) (238.0) 
Property, plant and equipment, net$233.0
 $210.2
 

NOTE 5.6. GOODWILL AND INTANGIBLE ASSETS


The changes in the carrying amount of goodwill by business segment were as follows:

(In millions)FoodTechAeroTechTotal
Balance as of January 1, 2021$505.7 $38.2 $543.9 
Acquisitions150.9 — 150.9 
Currency translation(9.9)(0.1)(10.0)
Balance as of December 31, 2021646.7 38.1 684.8 
Acquisitions141.0 — 141.0 
Currency translation(17.5)(0.5)(18.0)
Balance as of December 31, 2022$770.2 $37.6 $807.8 

(In millions)JBT FoodTech JBT AeroTech Total
Balance as of January 1, 2016$144.8
 $7.7
 $152.5
Acquisitions90.1
 —
 90.1
Currency translation(3.1) —
 (3.1)
Balance as of December 31, 2016231.8
 7.7
 239.5
Acquisitions51.4
 3.1
 54.5
Currency translation7.6
 0.2
 7.8
Balance as of December 31, 2017$290.8
 $11.0
 $301.8
Intangible assets consisted of the following:

20222021
(In millions)Carrying AmountAccumulated AmortizationCarrying AmountAccumulated Amortization
Customer relationships$437.8 $124.1 $309.3 $102.0 
Patents and acquired technology174.4 93.9 174.5 82.0 
Trademarks57.8 17.0 47.2 15.0 
Indefinite lived intangibles assets10.4 — 10.6 — 
Other8.6 8.6 8.7 8.7 
Total intangible assets$689.0 $243.6 $550.3 $207.7 
The components of intangible assets as of December 31, were as follows:

 2017 2016
(In millions)Gross carrying amount Accumulated amortization Gross carrying amount Accumulated amortization
Customer relationships$158.8
 $33.5
 $141.5
 $21.5
Patents and acquired technology92.1
 32.1
 64.8
 24.5
Tradenames20.0
 9.5
 18.1
 8.4
Indefinite lived intangible assets15.9
 —
 9.5
 —
Other14.5
 9.4
 14.8
 8.3
Total intangible assets$301.3
 $84.5
 $248.7
 $62.7


Intangible asset amortization expense was $19.6$43.2 million, $10.9$38.2 million, and $7.1$34.6 million for 2017, 20162022, 2021 and 2015,2020, respectively. Annual amortization expense for intangible assets is estimated to be $21.7$47.3 million in 2018, $21.62023, $45.2 million in 2019, $21.32024, $44.3 million in 2020, $20.92025, $42.4 million in 20212026, and $20.3$39.0 million in 2022.2027.

NOTE 6.7. DEBT
Our short-term debt consists
The components of borrowings under short-term credit facilities entered into by our wholly-owned subsidiaries in China and India. The Chinese short-term credit facilities, which mature on June 30, 2018, allow us to borrow up to a total of $12.0 million. We had $2.7 million and $4.4 million in borrowings under the credit facilities in ChinaCompany's borrowings as of December 31, 2017, and 2016, respectively. The Indian credit facility allows us to borrow up to a total of $1.4 million and $2.3 million; and we had no borrowings outstandingwere as offollows:
(In millions)Maturity Date20222021
Revolving credit facility (1)
December 14, 2026$584.6 $282.9 
Less: unamortized debt issuance costs(2.2)(1.2)
Revolving credit facility, net$582.4 $281.7 
Convertible senior notes (2)
May 15, 2026$402.5 $402.5 
Less: unamortized debt issuance costs(7.6)(9.8)
Convertible senior notes, net$394.9 $392.7 
Long-term debt, net$977.3 $674.4 
(1) Weighted-average interest rate at December 31, 2017 and 2016, respectively.2022 was 4.53%
(2) Effective interest rate for the Notes for the quarter ended December 31, 2022 was 0.82%
61


Components of interest expense recognized for the 0.25% Convertible Senior Notes due 2026 (the "Notes") were as follows for the years ended December 31:
(In millions)20222021
Contractual interest expense$1.0 $0.6 
Interest cost related to amortization of issuance costs2.2 1.3 
Total interest expense$3.2 $1.9 

Five-year Revolving Credit Facility and Term Loan


We haveOn June 19, 2018, the Company entered into a five-year $600.0 million revolving credit facility, which matures in February 2020,Credit Agreement (the “Credit Agreement”) with Wells Fargo Bank, N.A.National Association, as administrative agent. Thisagent, and the other lenders party thereto. The Credit Agreement provided for a $1 billion revolving credit facility permitsthat matures in June 2023. The borrowings under the Credit Agreement were used to repay in full all outstanding indebtedness under the U.S.previous credit agreement. On May 25, 2021, the Company entered into the first amendment to the
Credit Agreement to permit the issuance of the Convertible Senior Notes described below. On December 14, 2021, the Company entered into the second amendment to increase its borrowing limit from $1 billion to $1.3 billion, extend the maturity of the Credit Agreement from June 2023 to December 2026, and in The Netherlands. Borrowingsmodified the leverage calculation to differentiate between secured debt and total debt. Revolving loans under the credit facility bear interest, at ourthe Company's option, at one month U.S.1) LIBOR subject(subject to a floor rate of zerozero) or a benchmark replacement rate, or 2) an alternative base rate which(which is the greater of Wells Fargo’s Prime Rate, the Federal Funds Rate plus 50 basis points, andor LIBOR plus 1%), plus, in each case, a margin dependent on ourthe leverage ratio. We are

The Company is required to make periodic interest payments on the borrowed amounts and to pay an annual facilitycommitment fee ranging fromof 15.0 to 30.0 basis points, depending on ourits leverage ratio.

We have an incremental term loan in the amount of $150.0 million which bears interest on the same fully funded terms as the revolving credit facility and matures in February 2020. We are required to make mandatory prepayments, subject to certain exceptions, of the term loan with the net cash proceeds of (i) any issuance or other incurrence of indebtedness not otherwise permitted under the Credit Agreement and (ii) certain sales or other dispositions of assets subject to certain exceptions and thresholds. We are required to repay the term loan in quarterly principal installments of $1.9 million beginning on March 31, 2018, with a balloon payment at maturity to pay the remaining outstanding balance.

As of December 31, 2017 we2022, the Company had $150.0 million outstanding under the term loan within the credit facility, $230.5$584.6 million drawn on and $354.7$709.0 million of availability under the revolving credit facility. OurThe ability to use this availability is limited by the leverage ratio covenant described below.


OurThe obligations under the Credit Agreement are guaranteed by the Company’s domestic and certain foreign subsidiaries and subsequently formed or acquired subsidiaries (the “Guarantors”). The obligations under the Credit Agreement are secured by a first-priority security interest in substantially all of the Guarantor’s tangible and intangible personal property and a pledge of the capital stock of permitted borrowers and certain Guarantors.
The Company's credit facility includes restrictive covenants that, if not met, could lead to renegotiation of ourits credit facility, a requirement to repay ourits borrowings, and/or a significant increase in ourits cost of financing. Restrictive covenants include a minimum interest coverage ratio, a maximum leverage ratio, as well as certain events of default.

Convertible Senior Notes

On May 28, 2021, the Company closed a private offering of $402.5 million aggregate principal amount of the Company's 0.25% Convertible Senior Notes due 2026 (the "Notes") to qualified institutional buyers, resulting in net proceeds of approximately $392.2 million after deducting initial purchasers’ discounts of the Notes. Interest on the Notes has accrued from May 28, 2021 and limitationsis payable semi-annually in arrears on payments madeMay 15 and November 15 of each year, beginning on November 15, 2021, at a rate of 0.25% per year. The Notes will mature on May 15, 2026 unless earlier converted, redeemed or repurchased. No sinking fund is provided for the Notes.

The initial conversion rate of the Notes is 5.8958 shares of the Company's common stock per $1,000 principal amount of notes, which is equivalent to stockholders. For information, referan initial conversion price of approximately $169.61 per share. The conversion rate of the Notes is subject to adjustment upon the occurrence of certain specified events. In addition, upon the occurrence of a make-whole fundamental change (as defined in the indenture governing the Notes (the "Indenture")) or upon a notice of redemption, the Company will, in certain circumstances, increase the conversion rate for a holder that elects to convert its Notes in connection with such make-whole fundamental change or notice of redemption, as the case may be.

62

On or after March 20, 2024, the Company has the option to redeem for cash all or part of the Notes, if the last reported sales price of the Company's common stock (the "common stock") has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which the Company provides redemption notice, during any 30 consecutive trading days ending on, and including, the last trading day immediately before the date the Company sends the related redemption notice. The redemption price of each Note to be redeemed will be the principal amount of such note, plus accrued and unpaid interest to, but excluding, the redemption date. If the Company redeems less than all the outstanding Notes, at least $100 million aggregate principal amount of Notes must be outstanding and not subject to redemption as of the relevant redemption notice date.

Prior to the section entitled “Contractual Obligationsclose of business on the business day immediately preceding February 15, 2026, the Notes are convertible at the option of the holders only under the following circumstances:

•during any calendar quarter commencing after the calendar quarter ending on September 30, 2021 (and only during such calendar quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and Off-Balance Sheet Arrangements”including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day;
•during the five business day period after any ten consecutive trading day period (the “measurement period”) in Item 7. Management's Discussionwhich the trading price per $1,000 principal amount of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the common stock and Analysisthe conversion rate on each such trading day;
•if the Company calls such Notes for redemption, at any time prior to the close of Financial Conditionbusiness on the scheduled trading day immediately preceding the redemption date, but only with respect to the Notes called (or deemed called) for redemption; or
•upon the occurrence of certain corporate events, as specified in the Indenture governing the Notes.

At any time on or after February 15, 2026, holders may convert their Notes at their option, and Resultsin multiples of Operations$1,000 principal amount, without regard to the foregoing circumstances. Upon conversion, the Company will pay cash up to the aggregate principal amount of the Notes and for the remainder of our conversion obligation in excess of the aggregate principal amount will pay or deliver cash, shares of common stock, or a combination of cash and shares of common stock at the Company’s election.

The Notes were not convertible during the year ended December 31, 2021 and none have been converted to date. Also given the daily average market price of the common stock has not exceeded the exercise price since inception, there is no impact to the diluted earnings per share.

Upon the occurrence of a fundamental change (as defined in the Indenture), subject to certain conditions, holders may require the Company to repurchase for cash all or any portion of their Notes in multiples of $1,000 principal amounts, at its repurchase price, plus accrued and unpaid interest to, but excluding, the repurchase date.

The Notes are senior unsecured obligations and rank equally in right of payment with all of the Company's existing unsubordinated debt and senior in right of payment to any future debt that is expressly subordinated in right of payment to the Notes. The Notes will be effectively subordinated to any of the Company's existing and future secured debt to the extent of the assets securing such indebtedness.

The Indenture includes customary terms and covenants, including certain events of default after which the Notes may become due and payable immediately.

Convertible Note Hedge Transactions

The Company paid an aggregate amount of $65.6 million for the Convertible Note Hedge Transactions (the "Hedge Transactions"). The Hedge Transactions cover, subject to anti-dilution adjustments substantially similar to those in the Notes, approximately 2.4 million shares of the Company's common stock. These are the same number of shares initially underlying the Notes, at a strike price of $169.61, subject to customary adjustments. The Hedge Transactions will expire upon the maturity of the Notes, subject to earlier exercise or termination.

The Hedge Transactions are expected generally to reduce the potential dilutive effect of the conversion of the Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the converted Notes, in the event that the market price per share of the Company's common stock, as measured under the terms of the Hedge Transactions, is greater than the Hedge Transactions strike price of $169.61. The Hedge Transactions meet the criteria in ASC 815-40 to be classified within Stockholders' Equity, and therefore these transactions are not revalued after their issuance.

The Company made a tax election to integrate the Notes and the Hedge Transactions. The accounting impact of this Annual Reporttax election makes the Hedge Transactions deductible as original issue discount interest for tax purposes over the term of the note, and resulted in a
63

$17.1 million deferred tax asset recorded as an adjustment to Additional paid-in capital on Form 10-K.


Our debtour Balance Sheet as of December 31, consisted2022 and 2021.

Warrant Transactions

In addition, concurrently with entering into the Hedge Transactions, the Company separately entered into privately-negotiated Warrant Transactions (the "Warrant Transactions"), whereby the Company sold to the counterparties warrants to acquire, collectively, subject to anti-dilution adjustments, 2.4 million shares of its common stock at an initial strike price of $240.02 per share. The Company received aggregate proceeds of $29.5 million from the Warrant Transactions with the counterparties, with such proceeds partially offsetting the costs of entering into the Hedge Transactions. The warrants expire in August 2026. If the market value per share of the following:common stock, exceeds the strike price of the warrants, the warrants will have a dilutive effect on our earnings per share, unless the Company elects, subject to certain conditions, to settle the warrants in cash. The warrants meet the criteria in ASC 815-40 to be classified within Stockholders' Equity, and therefore the warrants are not revalued after issuance.


(In millions)
Interest Rate at
December 31, 2017
 
Maturity
Date
 2017 2016 
Short-term borrowings        
Foreign credit facilities5.2% 
 $2.8
 $4.4
 
Other0.1%   0.2
 1.2
 
Total short-term borrowings    $3.0
 $5.6
 
Long-term debt        
Revolving credit facility2.1% February 10, 2020 $230.5
 $342.1
 
Term loan2.1% February 10, 2020 150.0
 150.0
 
Brazilian Real Loan8.0% October 16, 2017 —
 1.5
 
Total long-term debt    380.5
 493.6
 
Less: current portion    (7.5) (1.5) 
Long-term debt, less current portion    373.0
 492.1
 
Less: unamortized debt issuance costs - term loan    (0.4) (0.5) 
Long-term debt, net    $372.6
 $491.6
 

Scheduled maturities of long-term debt for the years ending December 31, are as follows:
(In millions)Maturities of Long-term debt 
2018$7.5
 
20197.5
 
2020365.5
 
Total$380.5
 

NOTE 7.8. INCOME TAXES


Domestic and foreign components of income from continuing operations before income taxes for the years ended on December 31, are shown below:

(In millions)202220212020
Domestic$79.7 $71.5 $78.6 
Foreign74.5 81.2 66.9 
Income before income taxes$154.2 $152.7 $145.5 
(In millions)2017 2016 2015 
Domestic$72.8
 $43.6
 $38.2
 
Foreign59.4
 50.4
 44.0
 
Income before income taxes$132.2
 $94.0
 $82.2
 



The provision for income taxes related to income from continuing operations for the years ended on December 31, consisted of:

(In millions)202220212020
Current:
Federal$26.5 $4.2 $4.6 
State8.2 2.2 3.0 
Foreign14.6 30.6 19.3 
Total current$49.3 $37.0 $26.9 
Deferred:
Federal$(19.2)$1.0 $8.9 
State(4.2)1.5 1.5 
Foreign(2.4)(5.2)(0.6)
Total deferred$(25.8)$(2.7)$9.8 
Provision for income taxes$23.5 $34.3 $36.7 

The Company included in the tax provision for the year ended December 31, 2021 an immaterial correction of the rate applied since 2017 to a deferred tax liability associated with an investment in a subsidiary.
64

(In millions)2017 2016 2015 
Current:      
Federal$13.2
 $7.8
 $6.0
 
State1.0
 2.2
 1.2
 
Foreign17.6
 16.1
 13.2
 
Total current31.8
 26.1
 20.4
 
Deferred:      
Federal16.6
 1.0
 4.8
 
State1.6
 0.3
 0.9
 
Foreign(1.0) (0.9) (0.8) 
Change in the valuation allowance for deferred tax assets0.4
 —
 —
 
Change in deferred tax liabilities due to foreign tax rate change0.3
 —
 0.4
 
Benefits of operating loss carryforward0.4
 (0.5) 0.5
 
Total deferred18.3
 (0.1) 5.8
 
Provision for income taxes$50.1
 $26.0
 $26.2
 


Significant components of our deferred tax assets and liabilities at December 31, were as follows:

(In millions)20222021
Deferred tax assets attributable to:
Accrued pension and other postretirement benefits$8.8 $14.2 
Accrued expenses and accounts receivable allowances16.2 18.6 
Net operating loss carryforwards9.0 9.5 
Inventories13.2 9.0 
Stock-based compensation4.2 3.3 
Operating lease liabilities10.6 8.9 
Convertible bond11.7 15.2 
Research and development costs24.7 — 
Research and development credit carryforwards5.5 4.6 
Foreign tax credit carryforwards1.2 0.9 
Other3.2 0.1 
Total deferred tax assets$108.3 $84.3 
Valuation allowance(3.9)(4.9)
Deferred tax assets, net of valuation allowance$104.4 $79.4 
Deferred tax liabilities attributable to:
Investment in subsidiary$9.3 $10.0 
Property, plant and equipment26.0 24.9 
Goodwill and intangibles71.6 75.0 
Right to use lease assets10.6 8.8 
Net investment hedges7.7 2.0 
Total deferred tax liabilities$125.2 $120.7 
Net deferred tax liabilities$(20.8)$(41.3)
(In millions)2017 2016 
Deferred tax assets attributable to:    
Accrued pension and other post-retirement benefits$20.5
 $30.1
 
Accrued expenses and accounts receivable allowances13.6
 20.5
 
Net operating loss carryforwards5.9
 2.3
 
Inventories5.5
 9.0
 
Stock-based compensation5.4
 8.4
 
Research and development credit carryforwards3.4
 1.5
 
Foreign tax credit carryforward0.3
 0.2
 
Total deferred tax assets54.6
 72.0
 
Valuation allowance(2.7) —
 
Deferred tax assets, net of valuation allowance51.9
 72.0
 
Deferred tax liabilities attributable to:    
Liquidation of subsidiary for income tax purposes13.3
 13.3
 
Property, plant and equipment11.6
 14.1
 
Goodwill and amortization24.3
 15.5
 
Other0.6
 0.2
 
Total deferred tax liabilities49.8
 43.1
 
Net deferred tax assets$2.1
 $28.9
 


Included in our deferred tax assets are tax benefits related to net operating loss carryforwards attributable to our foreign and domestic operations. At December 31, 2017, we had $7.8The net tax effect of state and foreign loss carryforwards at year-end 2022 totaled $9.0 million. Of this amount, $7.7 million of net operating losses that are available to offset future taxable income in several foreign jurisdictions indefinitely, and $18.5$1.3 million of net operating losses that are available to offset future taxable income through 2034.2026. Of the $18.5tax effected losses, approximately $1.4 million approximately $14.1 million of net operating losses in Switzerland and the Netherlands are subject to a full valuation allowance. During 2017, we expect to use $3.6 million of net operating losses relating to prior yearsallowance, as management has concluded that, based on the available evidence, it is more likely than not that the deferred tax assets will not be fully utilized.

Included in the filing of our 2017 corporate income tax returns.

Also included in our deferred tax assets at December 31, 20172022 are $2.5$5.5 million of U.S. research and development credit carryforwards, of which $5.2 million are U.S. state credits that will expire beginning in 2022,2028, if unused. Of the $5.2 million, approximately $2.0 million are subject to a full valuation allowance, as management has concluded that, based on the available evidence, it is more likely than not that the deferred tax assets will not be fully utilized.




65

The effective income tax rate was different from the statutory U.S. federal income tax rate due to the following:

202220212020
Statutory U.S. federal tax rate21%21%21%
Net difference resulting from:
Research and development tax credit(5)(4)(5)
Foreign earnings subject to different tax rates232
Nondeductible expenses—12
State income taxes223
Foreign tax credits(5)(2)(4)
Foreign withholding taxes111
Effect of UK law change—3—
Global intangible low-taxed income (GILTI)5—3
Stock based compensation - excess tax benefit(2)——
Remeasurement of deferred tax liability—(3)—
Valuation allowance on state tax credit1——
Other(5)—2
Total difference(6)%1%4%
Effective income tax rate15%22%25%

 2017 2016 2015 
Statutory U.S. federal tax rate35 % 35 % 35 % 
Net difference resulting from:      
Research and development tax credit(4) (4) (2) 
Foreign earnings subject to different tax rates(2) (3) (3) 
Tax on foreign intercompany dividends and deemed dividends for tax purposes—
 —
 6
 
Nondeductible expenses1
 —
 —
 
State income taxes2
 2
 2
 
Foreign tax credits(1) (1) (7) 
Foreign withholding taxes1
 —
 1
 
Effect of US Law Change12
 —
 —
 
Stock Based Compensation - Excess Tax Benefit under ASC 2016-09(5) —
 —
 
Other(1) (1) —
 
Total difference3
 (7) (3) 
Effective income tax rate38 % 28 % 32 % 

U.S. income taxes have not been provided on $15.4 million of undistributedThe Company considers the unremitted earnings of certain foreign subsidiaries atindefinitely reinvested. With respect to these subsidiaries, the Company has not provided deferred taxes on unremitted earnings of approximately $232 million. The amount of unrecognized deferred tax liabilities associated with these earnings is approximately $3 million.

As of December 31, 2017 as these amounts are considered permanently invested under ASC 740-30-25-17 [formerly known as APB 23]. A liability could arise if our intention to permanently invest such earnings were to change2022, the Company has recorded estimated deferred taxes of $9.3 million for income and amounts are distributed by such subsidiaries, or if such subsidiaries are ultimately disposed. It is not practicable to estimate the additional incomewithholding taxes related to the hypothetical distribution of permanently invested earnings.

Additionally, in accordance with guidance as set-forth in SEC Staff Accounting Bulletin No. 118 ("SAB 118") other than the amount accrued for the Transition Tax per IRC 965, the company does not include a provisional amount related to any of the impacted items covered under APB 23, as we have not performed sufficient analysis to make a determination as to the appropriateness and resulting tax effects.

The following tax years remain subject to examination in the following significant jurisdictions:

Belgium2014-2017
Brazil2012-2017
Italy2014-2017
Netherlands2012-2017
Sweden2011-2017
United States2016-2017

Income Tax Reform Disclosures
On December 22, 2017, Congress passed, and the President signed, the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax Code, including, but not limited to, (1) reducing the U.S. federal corporate income tax rate from 35.0 percent to 21.0 percent; (2) requiring companies to pay a one-time transitional tax on certain un-repatriated earnings of foreign subsidiaries; (3) generally eliminating U.S. federal income tax on dividends fromCompany's foreign subsidiaries of U.S. corporations; (4) repealing the domestic production activity deduction; (5) providing for the full expensing of qualified property; (6) adding a new provision designed to tax global intangible low-taxed income (“GILTI”); (7) revising the limitation imposed on deductions for executive compensation paid by publicly-traded companies; (8) eliminating the corporate alternative minimum tax (“AMT”) and changing how existing AMT credits can be utilized; (9) creating a base erosion-anti-abuse tax (“BEAT”), a new minimum tax on payments made by certain U.S. corporations to related foreign parties; (10) imposing a new limitation on the deductibility of interest expense; (11) allowing for a deduction related to foreign-derived intangible income (“FDII”); and (12) changing the rules related to the uses and limitations of net operating loss carryforwards generated in tax years beginning after December 31, 2017. Some of the changes that are material to the company are discussed below in more detail.not permanently reinvested.



The SEC recently issued SAB 118 which provides guidance on how companies should account for the tax effects related to the Tax Act. According to SAB 118, companies should make a good faith effort to compute the impact of the Tax Act in a timely manner once the company has obtained, prepared, and analyzed the information needed in order to complete their accounting requirements under ASC 740, which in no circumstances should extend beyond one year from the enactment date. However, in situations when the company’s accounting is incomplete, SAB 118 authorizes companies to record a reasonable provisional estimate of the tax impact resulting from the Tax Act.

The Tax Act imposed a one-time deemed repatriation transition tax on the previously untaxed and un-repatriated current and accumulated post-1986 foreign earnings of certain foreign subsidiaries. The Tax Act further provides for a deduction to offset a portion of the deemed repatriated earnings such that taxpayers are effectively taxed at a reduced tax rate of 15.5 percent to the extent that the earnings are held in cash or cash equivalents, and 8.0 percent on all other earnings. In order to compute the tax impact of this deemed repatriation for the Company’s taxable year ending December 31, 2017, the applicable amount of un-repatriated earnings and foreign taxes paid by each relevant foreign subsidiary must be determined. We have computed a reasonable estimate of the tax impact related to this deemed repatriation in accordance with SAB 118 and recorded a provisional tax obligation because the Company is still collecting and analyzing the necessary information and will reflect any changes to this calculation in a subsequent reporting period. Due to the timing of the Tax Act and related changes we will update our computations as information becomes available with regard to the 2017 tax return filings and as tax technical guidance on remaining items is issued at the federal and state level.

The Tax Act also revised the definition of “covered employees” who are subject to the $1.0 million limitation imposed on deductions for executive compensation paid by publicly-traded corporations. As a result, the limitation now applies to the Company’s CEO, CFO and the 3 highest paid employees. The Tax Act also eliminated the exception to this rule for commission or performance-based compensation paid to these covered employees. This new provision is effective for contracts executed on or after November 3, 2017. Based on this new provision, the Company adjusted its deferred tax asset related to future stock compensation deductions for amounts that it does not expect it will be able to deduct in the future. We will continue to analyze executive compensation in future periods and adjust our Deferred Tax Asset for future stock compensation deductions as information becomes available.

The Tax Act reduces the corporate tax rate to 21.0 percent, effective January 1, 2018. For certain deferred taxes, we have recorded a provisional adjustment to decrease net deferred tax assets by $7.0 million, with a corresponding net adjustment to deferred tax expense of $7.0 million for the year ended December 31, 2017. We made a reasonable estimate of the impact of the reduction in the corporate tax rate under the Tax Act, but the analysis will continue during 2018 and will be completed once the Company files its income tax returns in 2018.

The Tax Act changes also require JBT to analyze other areas including, but not limited to, interest deductibility, accelerated cost recovery of fixed assets, GILTI, BEAT, FDII, and stranded tax effects within Accumulated other comprehensive income. The Company has not maderecorded any policy decisionsunrecognized deferred tax benefits, as the Company does not believe it has any positions that meet the criteria for establishing an uncertain tax position liability.

In our major jurisdictions, including the United States, Belgium, Brazil, the Netherlands, Sweden, and the United Kingdom, tax years are typically subject to howexamination for three to account for the tax effects of these items and will continue to analyze the impact during 2018 as more information is available and more technical guidance is issued at the federal and state levels.five years.

(in millions)
Increase (Decrease)(a)
Tax Act ProvisionIncome Tax ProvisionIncome Taxes PayableDeferred Tax Assets and LiabilitiesOther Long-term Liabilities
Reduction in U.S. Federal corporate rate$7.0
$—
$(7.0)$—
One-time repatriation transition tax7.7
1.0
—
6.7
Revision to deduction for executive compensation0.8
—
(0.8)—
Tax Act impact as of and for the year ended December 31, 2017$15.5
$1.0
$(7.8)$6.7
(a)    Reflects provisional amounts reported in results until full accounting for the income tax effect is complete.

NOTE 8.9. PENSION AND POST-RETIREMENT AND OTHER BENEFIT PLANS


We sponsorThe Company sponsors qualified and nonqualified defined benefit pension plans that together cover many of ourits U.S. employees. The plans provide defined benefits based on years of service and final average salary. WeThe Company also sponsorsponsors a noncontributory plan that provides post-retirement life insurance benefits ("OPEB") to some of ourits U.S. employees. Foreign-basedNon-U.S. based employees are eligible to participate in either Company-sponsored or government-sponsored benefit plans to which we contribute. Wethe Company contributes. The Company also sponsorsponsors separate defined contribution plans that cover substantially all of ourits U.S. employees and some internationalnon-U.S. employees.



66

The funded status of ouris pension and post-retirement benefit plans, together with the associated balances recognized in ourits consolidated financial statements as of December 31, 20172022 and 2016,2021, were as follows:
(In millions)20222021
Projected benefit obligation at January 1$357.7 $384.0 
Service cost1.7 2.2 
Interest cost7.4 6.4 
Actuarial (gain) loss(76.2)(13.8)
Plan participants' contributions0.2 0.2 
Benefits paid(16.9)(16.5)
Currency translation adjustments(4.7)(4.8)
Projected benefit obligation at December 31$269.2 $357.7 
Fair value of plan assets at January 1$301.7 $290.8 
Company contributions3.3 13.0 
Actual return on plan assets(49.7)15.3 
Plan participants' contributions0.2 0.2 
Benefits paid(16.9)(16.5)
Currency translation adjustments(0.9)(1.1)
Fair value of plan assets at December 31$237.7 $301.7 
Funded status of the plans (liability) at December 31$(31.5)$(56.0)
Amounts recognized in the Consolidated Balance Sheets at December 31
Other current liabilities(1.5)(0.9)
Accrued pension and other post-retirement benefits, less current portion(30.0)(55.1)
Net amount recognized$(31.5)$(56.0)
 Pensions Other post-retirement benefits 
(In millions)2017 2016 2017 2016 
Projected benefit obligation at January 1$317.4
 $316.3
 $3.3
 $3.2
 
Service cost1.7
 1.4
 —
 —
 
Interest cost10.7
 11.4
 0.1
 0.1
 
Actuarial (gain) loss23.9
 11.4
 0.3
 0.4
 
Plan participants' contributions0.1
 0.2
 —
 —
 
Business combinations—
 2.1
 —
 —
 
Benefits paid(13.8) (23.2) (0.2) (0.4) 
Currency translation adjustments4.9
 (2.2) —
 —
 
Projected benefit obligation at December 31$344.9
 $317.4
 $3.5
 $3.3
 
Fair value of plan assets at January 1$233.0
 $227.3
 $—
 $—
 
Company contributions11.1
 10.3
 0.2
 0.4
 
Actual return (loss) on plan assets29.8
 18.8
 —
 —
 
Plan participants' contributions0.1
 0.2
 —
 —
 
Benefits paid(13.8) (23.2) (0.2) (0.4) 
Currency translation adjustments1.3
 (0.4) —
 —
 
Fair value of plan assets at December 31$261.5
 $233.0
 $—
 $—
 
Funded status of the plans (liability) at December 31$(83.4) $(84.4) $(3.5) $(3.3) 
Amounts recognized in the Consolidated Balance Sheets at December 31        
Other current liabilities(0.9) (1.3) (0.3) (0.2) 
Accrued pension and other post-retirement benefits, less current portion(82.5) (83.1) (3.2) (3.1) 
Net amount recognized$(83.4) $(84.4) $(3.5) $(3.3) 


The liability associated with the OPEB plan included in the consolidated financial statements was $2.3 million and $2.6 million as of December 31, 2022 and 2021, respectively.

Amounts recognized in accumulated other comprehensive loss at December 31, 20172022 and 20162021 were $182.4$177.3 million and $174.1$196.2 million, respectively for pensions, and $.2$(0.4) million and $(0.1)$(0.2) million for other post-retirement benefits,the OPEB plan, respectively. These amounts were primarily unrecognized actuarial gains and losses.


The accumulated benefit obligation for all pension plans was $336.2$265.0 million and $310.3$350.6 million at December 31, 20172022 and 2016,2021, respectively. All pension plans had accumulated benefit obligations in excess of plan assets as of December 31.31, 2022. For the year ended December 31, 2022, accumulated benefit obligation for the pension plans decreased primarily due to actuarial gains incurred from the increase in discount rates driven by an increase in bond yields.


Pension and other post-retirement benefit costs (income) for the years ended December 31, were as follows:

(In millions)202220212020
Service cost$1.7 $2.2 $2.2 
Interest cost7.4 6.4 8.7 
Expected return on plan assets(15.7)(15.6)(13.1)
Amortization of net actuarial loss8.0 7.7 8.1 
Settlement loss recognized0.2 0.1 — 
Total costs$1.6 $0.8 $5.9 

OPEB plan costs were not material for the years ended December 31, 2022, 2021, and 2020.
67

 Pensions Other post-retirement benefits 
(In millions)2017 2016 2015 2017 2016 2015 
Service cost$1.7
 $1.4
 $1.5
 $—
 $—
 $—
 
Interest cost10.7
 11.4
 13.7
 0.1
 0.1
 0.2
 
Expected return on plan assets(17.1) (18.0) (19.1) —
 —
 —
 
Settlement charge—
 0.1
 0.3
 —
 —
 —
 
Amortization of prior service credit—
 —
 —
 —
 —
 (2.5) 
Amortization of net actuarial loss4.3
 4.1
 4.5
 —
 —
 —
 
Total (income) costs$(0.4) $(1.0) $0.9
 $0.1
 $0.1
 $(2.3) 



Pre-tax changes in projected benefit obligations and plan assets recognized in other comprehensive incomeloss during 20172022 for the OPEB plan were not material and for the pension plans were as follows:

(In millions)Pensions
Actuarial gain$(10.7)
Amortization of net actuarial loss(8.2)
Net income recognized in other comprehensive income$(18.9)
Total recognized in net periodic benefit cost and other comprehensive income$(17.3)
(In millions)Pensions Other post-retirement benefits 
Actuarial loss$12.1
 $0.3
 
Amortization of net actuarial loss(5.1) —
 
Net loss recognized in other comprehensive income$7.0
 $0.3
 
Total recognized in net periodic benefit cost and other comprehensive income$6.6
 $0.4
 


The Company uses a corridor approach to recognize actuarial gains and losses that result from changes in actuarial assumptions. The corridor approach defers all actuarial gains and losses resulting from changes in assumptions in other accumulated other comprehensive income (loss), such as those related to changes in the discount rate and differences between actual and expected returns on plan assets. These unrecognized gains and losses are amortized when the net gains and losses exceed 10% of the higher of the market-related value of the assets or the projected benefit obligation for each respective plan. The amortization is on a straight-line basis over the life expectancy of the plan’s participants for the frozen plans and the expected remaining service periods for the other plans. We expect to amortize $6.3 million of net actuarial loss from accumulated other comprehensive income (loss) into net periodic benefit cost in 2018.


Beginning in 2010, the U.S. defined benefit plans were frozen to new entrants and future benefit accruals for non-union participants were discontinued.

On August 31, 2015, JBT amended the Retiree Welfare Benefits Plan to terminate future healthcare benefits effective January 1, 2016, which resulted in a release of $1.2 million of other post-retirement benefit liability into other comprehensive income. The resulting negative prior service cost of $1.8 million was amortized out of accumulated other comprehensive income into net income over the remaining life of the plan (through January 1, 2016).


The following weighted-average assumptions were used to determine the benefit obligations:obligations for the pension plans:

202220212020
Discount rate5.02%2.67%2.31%
Rate of compensation increase2.55%3.77%3.07%
 Pensions 
Other post-retirement
benefits
 
 2017 2016 2015 2017 2016 2015 
Discount rate3.48% 4.00% 4.40% 3.73% 4.30% 4.60% 
Rate of compensation increase3.10% 3.09% 3.19% —
 —
 —
 


The following weighted-average assumptions were used to determine net periodic benefit cost:cost for the pension plans:

202220212020
Discount rate2.86%2.32%2.98%
Rate of compensation increase2.55%3.77%3.07%
Expected rate of return on plan assets5.42%5.58%4.86%
 Pensions 
Other post-retirement
benefits
 
 2017 2016 2015 2017 2016 2015 
Discount rate3.98% 4.34% 4.03% 4.30% 4.60% 4.25% 
Rate of compensation increase3.10% 3.09% 3.19% —
 —
 —
 
Expected rate of return on plan assets6.58% 6.83% 7.08% —
 —
 —
 


The estimate of the expected rate of return on plan assets is based primarily on the historical performance of plan assets, asset allocation, current market conditions and long-term growth expectations.


Plan assets
Our
The Company's pension investment strategy balances the requirements to generate returns using higher-returning assets, such as equity securities, with the need to control risk in the pension plan with less volatile assets, such as fixed-income securities. Risks include, among others, the likelihood of the pension plans being underfunded, thereby increasing their dependence on Company contributions. The assets are managed by professional investment firms and performance is evaluated against specific benchmarks.



Our targetTarget asset allocations and actual allocations as of December 31, 20172022 and 20162021 were as follows:

Target20222021
Equity10% - 40%29%36%
Fixed income40% - 70%64%59%
Real estate and other0% - 15%6%4%
Cash0% - 10%1%1%
100%100%

68

 Target 2017 2016 
Equity30% - 70% 54% 50% 
Fixed income20% - 40% 29% 30% 
Real estate and other10% - 30% 16% 19% 
Cash0% - 10% 1% 1% 
   100% 100% 

Our actualActual pension plans’ asset holdings by category and level within the fair value hierarchy are presented in the following table:

As of December 31, 2022As of December 31, 2021
(In millions)TotalLevel 1Level 2TotalLevel 1Level 2
Cash and cash equivalents$2.8 $2.8 $— $2.4 $2.4 $— 
Equity securities:
All caps(1)
15.6 — 15.6 25.6 — 25.6 
International(2)
39.2 — 39.2 64.8 — 64.8 
Infrastructure(3)
10.3 10.3 — 14.8 14.8 — 
Fixed income securities:
Government securities(4)
32.5 — 32.5 34.6 — 34.6 
Corporate bonds(5)
109.3 — 109.3 135.1 8.0 127.1 
Other investments(6)
13.7 — 13.7 12.7 — 12.7 
Total assets at fair value$223.4 $13.1 $210.3 $290.0 $25.2 $264.8 
Investments valued using NAV as a practical expedient(7)
14.3 11.8 
Total assets$237.7 $301.8 

 As of December 31, 2017 As of December 31, 2016 
(In millions)Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 
Cash and cash equivalents$2.7
 $2.7
 $—
 $—
 $3.4
 $3.4
 $—
 $—
 
Equity securities:                
Large cap (1)
53.5
 —
 53.5
 —
 44.0
 —
 44.0
 —
 
Small cap (2)
48.8
 48.8
 —
 —
 71.1
 71.1
 —
 —
 
International (3)
39.9
 39.9
 —
 —
 —
 —
 —
 —
 
Fixed income securities:                
Government securities (4)
9.0
 —
 9.0
 —
 8.8
 —
 8.8
 —
 
Corporate bonds (5)
61.5
 49.0
 12.5
 —
 57.4
 46.2
 11.2
 —
 
Real estate and other investments (6)
46.1
 19.0
 27.1
 —
 48.3
 19.3
 29.0
 —
 
Total assets at fair value$261.5
 $159.4
 $102.1
 $—
 $233.0
 $140.0
 $93.0
 $—
 
(1)Includes funds that invest in large, medium and small cap equity securities.

(2)Includes funds that invest primarily in international equity securities.
(1)Includes funds that invest primarily in large cap equity securities.
(2)Includes small cap equity securities and funds that invest primarily in small cap equity securities.
(3)Includes funds that invest primarily in international equity securities.
(4)Includes U.S. government securities and funds that invest primarily in U.S. government bonds, including treasury inflation protected securities.
(5)Includes investment grade bonds, high yield bonds and mortgage-backed fixed income securities and funds that invest in such securities.
(6)Includes funds that invest primarily in REITs, funds that invest in commodities and investments in insurance contracts held by our foreign pension plans.

(3)Includes funds that invest primarily in infrastructure equity securities.
(4)Includes U.S. government securities and funds that invest primarily in U.S. government bonds, including treasury inflation protected securities.
(5)Includes funds that invest in investment grade bonds, high yield bonds and mortgage-backed fixed income securities.
(6)Includes funds that invest primarily in commodities and investments in insurance contracts held by the Company's foreign pension plans.
(7)As of December 31, 2021, the Company elected the practical expedient to characterize certain new investments which are measured at net asset values ("NAV") that have not been classified in the fair value hierarchy.
The fair value of assets classified as Level 1 is based on unadjusted quoted prices in active markets for identical assets. The fair value of assets classified as Level 2 is based on quoted prices for similar assets or based on valuations made using inputs that are either directly or indirectly observable as of the reporting date. SuchAs of December 31, 2021, such inputs include net asset values reported at a minimum on a monthly basis by investment funds or contract values provided by the issuing insurance company. We areThe Company is able to sell any of ourits investment funds with notice of no more than 30 days. For more information on the fair value hierarchy, see Note 14.16. Fair Value of Financial Instruments.


Contributions
We expect
The Company expects to contribute $15.3$14.5 million to ourits pension and other post-retirement benefit plans in 2018.2023. The pension contributions will be primarily for the U.S. qualified pension plan. All of the contributions are expected to be in the form of cash.



69

Estimated future benefit payments
The following table summarizes expected benefit payments from our various pension and post-retirement benefit plans through 2027.2032. Actual benefit payments may differ from expected benefit payments.

(In millions)Pensions
2023$18.1 
202419.0 
202520.8 
202619.9 
202720.1 
2028-203299.3 
(In millions)Pensions Other post-retirement benefits 
2018$15.3
 $0.2
 
201915.6
 0.2
 
202018.6
 0.2
 
202116.9
 0.2
 
202217.5
 0.2
 
2023-202799.2
 1.0
 


Savings Plans
Our
U.S. and some international employees participate in defined contribution savings plans that we sponsor.the Company sponsors. These plans generally provide company matching contributions on participants’ voluntary contributions and/or company non-elective contributions. Additionally, certain highly compensated employees participate in a non-qualified deferred compensation plan, which also allows for company matching contributions and company non-elective contributions on compensation in excess of the Internal Revenue Code Section 401(a) (17) limit. The expense for matching contributions was $13.5$17.8 million, $11.3$15.9 million, and $9.0$15.1 million in 2017, 20162022, 2021 and 2015,2020, respectively.

NOTE 9.10. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)


Accumulated other comprehensive income or loss (“AOCI”) represents the cumulative balance of other comprehensive income, net of tax, as of the balance sheetBalance Sheet date. For JBT,the Company, AOCI is primarily composed of adjustments related to pension and other post-retirement benefits plans, derivatives designated as hedges, and foreign currency translation adjustments. Changes in the AOCI balances for the years ended December 31, 20172022 and 20162021 by component are shown in the following table:

(In millions)
Pension and Other Post-retirement Benefits(1)
Derivatives Designated as Hedges(1)
Foreign Currency Translation(1)
Total(1)
Balance as of January 1, 2021$(161.4)$(3.8)$(54.7)$(219.9)
Other comprehensive income (loss) before reclassification10.1 4.3 3.1 17.5 
Amounts reclassified from accumulated other comprehensive income5.8 1.3 (2.1)5.0 
Balance as of December 31, 2021$(145.5)$1.8 $(53.7)$(197.4)
Other comprehensive income (loss) before reclassification8.5 14.7 (36.7)(13.5)
Amounts reclassified from accumulated other comprehensive income6.1 (1.7)2.2 6.6 
Balance as of December 31, 2022$(130.9)$14.8 $(88.2)$(204.3)

 Pension and Other Post-retirement Benefits Derivatives Designated as Hedges Foreign Currency Translation Total 
(In millions)        
Balance as of January 1, 2016$(103.8) $(0.8) $(42.6) $(147.2) 
Other comprehensive gain (loss) before reclassification(7.3) (0.1) (5.7) (13.1) 
Amounts reclassified from accumulated other comprehensive income2.5
 0.8
 —
 3.3
 
Balance as of December 31, 2016(108.6) (0.1) (48.3) (157.0) 
Other comprehensive gain (loss) before reclassification(8.1) 0.4
 20.5
 12.8
 
Amounts reclassified from accumulated other comprehensive income2.8
 1.1
 —
 3.9
 
Balance as of December 31, 2017$(113.9) $1.4
 $(27.8) $(140.3) 
(1)    All amounts are net of income taxes.


Reclassification adjustments from AOCI into earnings for pension and other post-retirement benefits plans for the year ended December 31, 20172022 were $4.8$8.2 million of charges in selling, general and administrative expensesto pension (income) expense, other than service cost, net of $2.0$2.1 million in provision for income taxes.tax benefit. Reclassification adjustments for derivatives designated as hedges for the same periodyear ended December 31, 2022 were $1.2$2.4 million of chargesinterest income, net of $0.7 income tax provision. Reclassification adjustments for foreign currency translation related to net investment hedges for the year ended December 31, 2022 were $2.9 million of benefit in interest expense, net of $0.5$0.7 million in provision for income taxes.


Reclassification adjustments from AOCI into earnings for pension and other post-retirement benefits plans for the year ended December 31, 20162021 were $4.1$7.8 million of charges in selling, general and administrative expensesto pension (income) expense, other than service cost, net of $1.6$2.0 million in provision for income taxes. Reclassification adjustments for derivatives designated as hedges for the same periodyear ended December 31, 2021 were $1.3$1.8 million of charges in interest expense, net of $0.5 million income tax benefit. Reclassification adjustments for foreign currency translation related to net investment hedges for the year ended December 31, 2021 were $2.9 million of benefit in interest expense, net of $0.8 million in provision for income taxes.

70


NOTE 10.11. STOCK-BASED COMPENSATION


WeThe Company recorded stock-based compensation expense and related income tax effects for the years ended December 31, as follows:

(In millions)202220212020
Stock-based compensation expense$10.2 $6.5 $1.9 
Tax benefit (expense) recorded in consolidated statements of income$5.0 $2.2 $(0.1)
(In millions)2017 2016 2015 
Stock-based compensation expense$9.0
 $9.9
 $7.2
 
Tax benefit recorded in consolidated statements of income$9.9
 $3.9
 $2.9
 


As of December 31, 2017,2022, there was $13.3$14.3 million of unrecognized stock-based compensation expense for outstanding awards expected to be recognized over a weighted average period of 1.61.8 years.


Incentive Compensation Plan
We sponsor
The Company sponsors a stock-based compensation plan (the “Incentive Compensation Plan”) that provides certain incentives and awards to ourits officers, employees, directors and consultants. The Incentive Compensation Plan allows the Compensation Committee (the “Committee”) of ourthe Board of Directors to make various types of awards to eligible individuals. Awards that may be issued include common stock, stock options, stock appreciation rights, restricted stock and stock units.


Restricted stock unit awards specify any applicable performance goals, the time and rate of vesting and such other provisions as determined by the Committee. Restricted stock units generally vest after 3 years of service, but may also vest upon a change of control as defined in the Incentive Compensation Plan. The 2017 Incentive Compensation Plan was approved by stockholders in May 2017. The 2017 Incentive Compensation Plan replaced the our prior incentive compensation plan (the “2008 Incentive Compensation Plan”), which remains in existence solely for the purpose of governing the terms of awards that had been granted under the 2008 Incentive Compensation Plan prior to May 2017.. The aggregate number of shares of common stock that are authorized for issuance under the 2017 Incentive Compensation Plan is (i) 1,000,000 shares, plus (ii) the number of shares of common stock that remained available for issuance under the 2008 Incentive Compensation Plan on the effective date of the 2017 Incentive Compensation Plan, plus (iii) the number of shares of common stock that were subject to outstanding awards under the 2008 Incentive Compensation Plan on the effective date of the 2017 Incentive Compensation Plan that are canceled, forfeited, returned or withheld without the issuance of shares thereunder.


Impact of Retirement on Outstanding LTIP Awards

In the event of a namedan executive officer’s retirement from the Company upon or after attaining age 62 and a specified number of years of service, any unvested long-term incentive plan (LTIP) equity or cashnonvested awards remain outstanding after retirement and vest on the originally scheduled vesting date. This permits flexibility in retirement planning, permits usthe Company to provide an incentive for the vesting period and does not penalize our employees who receive long-term cash and equity awards as incentive compensation when they retire. For awards granted prior to 2016, separation prior to attaining age 62 and 10 years of service will result in the forfeiture of unvested awards. In 2016, the Committee approved a variation to these terms, permitting the Committee to selectively grant awards that will permit unvested equity awards outstanding after retirement to vest on their originally scheduled vesting date following a retirement upon or after attaining the age of 62 and 5 years of service. This variation was approved to allow the Company the option to offer long term equity incentive compensation as a means of attracting and retaining personnel hired near their retirement or to incentivize existing employees who are nearing retirement, but who have not been with the Company for a full ten year period.


Restricted Stock Units

A summary of the non-vestednonvested restricted stock units as of December 31, 20172022 and changes during the year is presented below:

SharesWeighted-Average
Grant-Date
Fair Value
Nonvested at December 31, 2021406,406 $70.31 
Granted159,232 $107.53 
Vested(123,613)$43.56 
Forfeited(28,289)$122.02 
Nonvested at December 31, 2022413,736 $85.00 

 Shares 
Weighted-Average
Grant-Date
Fair Value
 
Nonvested at December 31, 20161,066,207
 $32.21
 
Granted129,569
 $88.02
 
Vested(296,608) $30.03
 
Forfeited(47,271) $47.49
 
Nonvested at December 31, 2017851,897
 $40.61
 

We grantThe Company grants time-based and performance-based restricted stock units that typically vest after three years, but can vary based on the discretion of the Committee. The fair value of these awards is determined using the market value of our common stock on the grant

date. Compensation cost is recognized over the lesser of the stated vesting period or the period until the employee meets the retirement eligible age and service requirements under the plan.


For



71

The number of shares to be issued for performance-based restricted stock units awards made in 2017, 20162022, 2021, and 2015; the number of shares to be issued2020, is dependent upon our performance over the three year period ending December 31st of the respective term and over the two year period for an additional grant awarded in 2021, with respect to cumulative diluted earnings per share from continuing operations and average operating return on invested capital (ROIC). ROIC is defined as net income plus after tax net interest expense divided by average invested capital, which is an average of total shareholders equity plus debt plus future pension expenses held in AOCI less cash and cash equivalents. Based on results achieved in 2017, 20162022, 2021, and 2015,2020, and the forecasted amounts over the remainder of the performance period, we expectthe Company expects to issue a total of 65,073, 134,13976,874, 22,811, 10,747, and 188,7874,647, shares at the vesting dates in April 2020, April 2019February 2025, March 2024, May 2023 and April 2018,March 2023, respectively. Compensation cost has been measured in 20172022 based on the projected performance values calculated against the established target.these expectations.


The following summarizes values for restricted stock activity in each of the years in the three year period ended December 31:

202220212020
Weighted-average grant-date fair value of restricted stock units granted$107.53 $142.32 $96.81 
Fair value of restricted stock vested (in millions)$14.5 $7.9 $6.5 

 2017 2016 2015 
Weighted-average grant-date fair value of restricted stock units granted (per share)$88.02
 $45.18
 $35.48
 
Fair value of restricted stock vested (in millions)$25.8
 $7.0
 $14.9
 

NOTE 11.12. STOCKHOLDERS’ EQUITY


The following is a summary of our capital stock activity (in shares) for the year ended December 31, 2017:2022:

Common
Stock Outstanding		Common Stock Held in Treasury
December 31, 202131,769,967 — 
Stock awards issued113,265 (21,552)
Treasury stock purchases(79,511)79,511 
December 31, 202231,803,721 57,959 
 
Common
stock outstanding
 
Common
stock held in
treasury
 
December 31, 201629,156,847
 159,194
 
Stock awards issued170,270
 (170,270) 
Treasury stock purchases(56,973) 56,973
 
Common stock issued

2,307,038
 —
 
December 31, 201731,577,182
 45,897
 

On March 13, 2017 we issued 2.3 million shares of common stock in an underwritten public offering which resulted in proceeds of $184.1 million, net of underwriting discounts and offering expenses. We used the net proceeds from this offering to repay a portion of our outstanding borrowings under our revolving credit facility and for general corporate purposes.


On December 2, 2015,1, 2021, the Board authorized a share repurchase program forof up to $30 million of ourthe Company's common stock, beginningeffective January 1, 2016 and continuing2022 through December 31, 2018.2024, which replaced the prior share repurchase program. Shares may be purchased from time to time in open market transactions, subject to market conditions. Repurchased shares become treasury shares, which are accounted for using the cost method and are intended to be used for future awards under the Incentive Compensation Plan. We repurchased $5.0


NOTE 13. REVENUE RECOGNITION

Transaction price allocated to the remaining performance obligations

The Company has estimated that $1,054.9 million of common stock in 2017 and $4.3 millionrevenue is expected to be recognized in the future periods related to remaining performance obligations from the Company's contracts with customers outstanding as of common stock in 2016.

On October 27, 2011, the Board authorized a share repurchase program for up to $30 million of our common stock, which expired on December 31, 2015. We repurchased $7.7 million2022. The Company expects to complete these obligations and recognize 84% as revenue in 2023, 14% in 2024, and the remainder after 2025.

72

Disaggregation of common stock in 2015.Revenue


On July 31, 2008, our Board declared a dividend distribution to each record holderIn the following table, revenue is disaggregated by type of common stockgood or service, primary geographical market, and timing of one Preferred Share Purchase Rightrecognition for each share of common stock outstanding on that date. Each right entitles the holder to purchase, under certain circumstances related toreportable segment. The table also includes a change in controlreconciliation of the disaggregated revenue to total revenue of each reportable segment.
December 31,
202220212020
(In millions)FoodTechAeroTechFoodTechAeroTechFoodTechAeroTech
Type of Good or Service
Recurring (1)
$751.4 $217.7 $661.6 $178.2 $610.7 $155.4 
Non-recurring (1)
839.2 358.0 738.8 289.3 623.8 337.9 
Total$1,590.6 $575.7 $1,400.4 $467.5 $1,234.5 $493.3 
Geographical Region (2)
North America$958.4 $522.4 $776.6 $416.9 $666.5 $423.9 
Europe, Middle East and Africa395.0 27.6 364.0 38.8 365.3 41.5 
Asia Pacific140.6 18.1 174.2 7.7 135.3 23.9 
Latin America96.6 7.6 85.6 4.1 67.4 4.0 
Total$1,590.6 $575.7 $1,400.4 $467.5 $1,234.5 $493.3 
Timing of Recognition
Point in Time$796.7 $285.9 $661.1 $218.1 $593.5 $251.7 
Over Time793.9 289.8 739.3 249.4 641.0 241.6 
Total$1,590.6 $575.7 $1,400.4 $467.5 $1,234.5 $493.3 

(1)     Aftermarket parts and services and operating lease revenues are considered recurring revenue. Non-recurring revenue includes new equipment and installation.

(2)     Geographical region represents the region in which the end customer resides.

Contract balances

The timing of revenue recognition, billings and cash collections results in trade receivables, contract assets, and advance and progress payments (contract liabilities). Contract assets exist when revenue recognition occurs prior to billings. Contract assets are transferred to trade receivables when the right to payment becomes unconditional (i.e., when receipt of the amount is dependent only on the passage of time). Conversely, the Company one one-hundredthoften receives payments from its customers before revenue is recognized, resulting in contract liabilities. These assets and liabilities are reported on the Balance Sheet as contract assets and within advance and progress payments, respectively, on a contract-by-contract net basis at the end of a shareeach reporting period.

Contract asset and liability balances for the period were as follows:
Balances as of
(In millions)December 31, 2022December 31, 2021December 31, 2020
Contract Assets$89.6 $94.4 $68.3 
Contract Liabilities182.1 178.0 123.8 

The revenue recognized during the year ended December 31, 2022, 2021 and 2020 that was included in contract liabilities at the beginning of Series A Junior Participating Preferred Stock, par value $0.01, at a pricethe period amounted to $149.2 million, $105.2 million, and $74.9 million respectively. Additionally, the Company assumed contract liabilities from acquisitions in the amount of $72 per share (subject to adjustment), subject to$19.1 million and $2.5 million in the termsyears 2022 and conditions2021, respectively. The remainder of a Rights Agreement dated Julychange from December 31, 2008. The rights expire on July2022, December 31, 2018, unless redeemed2021 and December 31, 2020 is driven by us at an earlier date. The redemption pricethe timing of $0.01 per right is subject to adjustment to reflect stock splits, stock dividends or similar transactions. We have reserved 1,500,000 sharesadvance and milestone payments received from customers, customer returns, and fulfillment of Series A Junior Participating Preferred Stock for possible issuance underperformance obligations. There were no significant changes in the agreement.contract balances other than those described above.

73


NOTE 12.14. EARNINGS PER SHARE

Basic earnings per share (“EPS”) is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the assumed conversion of all dilutive securities.


The following table sets forth the computation of basic and diluted EPS utilizingearnings per share ("EPS") from net income from continuing operations for the respective periods and our basic and dilutivediluted shares outstanding:

(In millions, except per share data)202220212020
Basic earnings per share:
Net income$130.7 $118.4 $108.8 
Weighted average number of shares outstanding32.0 32.0 32.0 
Basic earnings per share from net income$4.08 $3.70 $3.40 
Diluted earnings per share:
Net income$130.7 $118.4 $108.8 
Weighted average number of shares outstanding32.0 32.0 32.0 
Effect of dilutive securities:
Restricted stock units0.1 0.1 0.1 
Total shares and dilutive securities32.1 32.1 32.1 
Diluted earnings per share from net income$4.07 $3.69 $3.39 

(In millions, except per share data)2017 2016 2015 
Basic earnings per share:      
Income from continuing operations$82.1
 $68.0
 $55.9
 
Weighted average number of shares outstanding31.4
 29.4
 29.5
 
Basic earnings per share from continuing operations$2.61
 $2.31
 $1.90
 
Diluted earnings per share:      
Income from continuing operations$82.1
 $68.0
 $55.9
 
Weighted average number of shares outstanding31.4
 29.4
 29.5
 
Effect of dilutive securities:      
Restricted stock units0.5
 0.4
 0.3
 
Total shares and dilutive securities31.9
 29.8
 29.8
 
Diluted earnings per share from continuing operations$2.58
 $2.28
 $1.88
 
NOTE 13.15. DERIVATIVE FINANCIAL INSTRUMENTS AND CREDIT RISK


Derivative financial instruments

All derivatives are recorded as other assets or liabilities in the Consolidated Balance Sheets at their respective fair values. For derivatives designated as cash flow hedges, the effective portion of the unrealized gain or loss related to the derivatives are recorded in otherOther comprehensive income (loss) until the transaction affects earnings. We assessThe Company assesses both at inception of the hedge and on an ongoing basis, whether the derivative in the hedging transaction has been, and will continue to be, highly effective in offsetting changes in cash flows of the hedged item. The impact of any ineffectiveness is recognized in the Consolidated Statements of Income. Changes in the fair value of derivatives that do not meet the criteria for designation as a hedge are recognized in earnings.


Foreign Exchange: We manufacture The Company manufactures and sell oursells products in a number of countries throughout the world and, as a result, arethe Company is exposed to movements in foreign currency exchange rates. OurThe Company's major foreign currency exposures involve the markets in Western Europe, South America and Asia. Some of our sales and purchase contracts contain embedded derivatives due to the nature of doing business in certain jurisdictions, which we takethe Company takes into consideration as part of ourits risk management policy. The purpose of our foreign currency hedging activities is to manage the economic impact of exchange rate volatility associated with anticipated foreign currency purchases and sales made in the normal course of business. WeThe Company primarily utilizeutilizes forward foreign exchange contracts with maturities of less than 2 years in managing this foreign exchange rate risk. We haveThe Company has not designated these forward foreign exchange contracts, which havehad a notional value at December 31, 20172022 of $421.2$534.6 million, as hedges and therefore dodoes not apply hedge accounting.


Commodity Price Risk: The Company's operations subject us to risk related to the price volatility of certain commodities. We principally use a combination of purchase orders and various short-term supply arrangements in connection with the purchase of our raw materials and components required to manufacture our products. To mitigate the commodity price risk associated with the Company's operations, the Company may enter into commodity derivative instruments. During April 2022, the Company entered into various commodity forward contracts with a maturity of less than 1 year to mitigate this commodity price volatility. All of the Company's commodity forward contracts have expired as of December 31, 2022.

The fair values of our foreign currency and commodity derivative assets are recorded within other current assets and other assets, and the fair values of foreign currency and commodity derivative liabilities are recorded within other current liabilities and other liabilities. The following table presents the fair value of foreign currency derivatives includingand embedded derivatives included within the consolidated balance sheets:Balance Sheet:

As of December 31, 2022As of December 31, 2021
(In millions)Derivative AssetsDerivative LiabilitiesDerivative AssetsDerivative Liabilities
Total$4.5 $7.2 $10.6 $9.4 

74
 As of December 31, 2017 As of December 31, 2016 
(In millions)Derivative Assets Derivative Liabilities Derivative Assets Derivative Liabilities 
Other current assets / liabilities$3.3
 $5.7
 $7.2
 $4.8
 


A master netting arrangement allows counterparties to net settle amounts owed to each other as a result of separate offsetting derivative transactions. We enterThe Company enters into master netting arrangements with ourits counterparties when possible to mitigate credit risk in derivative transactions by permitting usit to net settle for transactions with the same counterparty. However, we dothe Company does not net settle with such counterparties. As a result, we presentthe Company presents derivatives at their gross fair values in the consolidated balance sheets.Balance Sheets.



As of December 31, 20172022 and 2016,2021, information related to these offsetting arrangements was as follows:


(In millions)As of December 31, 2022
Offsetting of Assets
Gross Amounts of Recognized AssetsGross Amounts Offset in the Consolidated Balance SheetsAmount Presented in the Consolidated Balance SheetsAmount Subject to Master Netting AgreementNet Amount
Derivatives$33.0 $— $33.0 $(3.0)$30.0 
(in millions)As of December 31, 2017 
Offsetting of Assets          
 Gross Amounts of Recognized Assets Gross Amounts Offset in the Consolidated Balance Sheets Amount Presented in the Consolidated Balance Sheets Amount Subject to Master Netting Agreement Net Amount 
Derivatives$5.2
 $—
 $5.2
 $(1.3) $3.9
 


Offsetting of LiabilitiesAs of December 31, 2022
Gross Amounts of Recognized LiabilitiesGross Amounts Offset in the Consolidated Balance SheetsAmount Presented in the Consolidated Balance SheetsAmount Subject to Master Netting AgreementNet Amount
Derivatives$7.3 $— $7.3 $(3.0)$4.3 

Offsetting of LiabilitiesAs of December 31, 2017 
(In millions)(In millions)As of December 31, 2021
Offsetting of AssetsOffsetting of Assets
Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Consolidated Balance Sheets Amount Presented in the Consolidated Balance Sheets Amount Subject to Master Netting Agreement Net Amount Gross Amounts of Recognized AssetsGross Amounts Offset in the Consolidated Balance SheetsAmount Presented in the Consolidated Balance SheetsAmount Subject to Master Netting AgreementNet Amount
Derivatives$5.5
 $—
 $5.5
 $(1.3) $4.2
 Derivatives$17.5 $— $17.5 $(7.3)$10.2 

(in millions)As of December 31, 2016 
Offsetting of Assets          
 Gross Amounts of Recognized Assets Gross Amounts Offset in the Consolidated Balance Sheets Amount Presented in the Consolidated Balance Sheets Amount Subject to Master Netting Agreement Net Amount 
Derivatives$7.2
 $—
 $7.2
 $(4.3) $2.9
 
Offsetting of LiabilitiesAs of December 31, 2021
Gross Amounts of Recognized LiabilitiesGross Amounts Offset in the Consolidated Balance SheetsAmount Presented in the Consolidated Balance SheetsAmount Subject to Master Netting AgreementNet Amount
Derivatives$9.1 $— $9.1 $(7.3)$1.8 
Offsetting of LiabilitiesAs of December 31, 2016 
 Gross Amounts of Recognized Liabilities Gross Amounts Offset in the Consolidated Balance Sheets Amount Presented in the Consolidated Balance Sheets Amount Subject to Master Netting Agreement Net Amount 
Derivatives$5.0
 $—
 $5.0
 $(4.3) $0.7
 


The following table presents the location and amount of the gain (loss)loss on foreign currency derivatives and on the remeasurement of assets and liabilities denominated in foreign currencies, as well as the net impact recognized in the consolidated statementsConsolidated Statements of income:Income:


Derivatives Not Designated as Hedging InstrumentsLocation of Gain (Loss) Recognized in IncomeAmount of Gain (Loss) Recognized in Income
(In millions)202220212020
Foreign exchange contractsRevenue$(7.4)$(1.1)$2.7 
Foreign exchange contractsCost of sales(3.7)(0.1)(3.1)
Foreign exchange contractsSelling, general and administrative expense2.2 1.0 2.5 
Commodity contractsCost of sales(0.7)— — 
Total$(9.6)$(0.2)$2.1 
Remeasurement of assets and liabilities in foreign currencies9.3 (0.8)(3.1)
Net gain (loss)$(0.3)$(1.0)$(1.0)
Derivatives not designated as hedging instruments Location of Gain (Loss) Recognized in Income Amount of Gain (Loss) Recognized in Income 
(In millions)   2017 2016 2015 
Foreign exchange contracts Revenue $0.2
 $(0.5) $0.8
 
Foreign exchange contracts Cost of products 0.8
 (0.5) (0.3) 
Foreign exchange contracts Other expense, net 1.0
 (1.0) (0.1) 
Total   2.0
 (2.0) 0.4
 
          
Remeasurement of assets and liabilities in foreign currencies   (2.6) 0.4
 (1.3) 
Net loss on foreign currency transactions   $(0.6) $(1.6) $(0.9) 


Interest Rates: We haveThe Company has entered into threefour interest rate swaps toexecuted in March 2020 with a combined notional amount of $200 million expiring in April 2025, and one interest rate swap executed in May 2020 with a notional amount of $50 million expiring in May 2025. These interest rate swaps fix the interest rate applicable to certain of ourthe Company's variable-rate debt. The agreements
75

swap one-month LIBOR for fixed rates. We haveThe Company has designated these swaps as cash flow hedges and all changes in fair value of the swaps are recognized in Accumulatedaccumulated other comprehensive income (loss).


At December 31, 2017,2022, the fair value recorded in other assets on the Consolidated Balance Sheet is $2.0 million. The effective portion of these derivatives designated as cash flow hedges were recorded in the Balance Sheet as other assets of $1.3$19.9 million has been reported inand as accumulated other comprehensive lossincome, net of tax, of $14.8 million.

Net Investment hedges:The Company has entered into cross currency swap agreements that synthetically swap $116.4 million of fixed rate debt to Euro denominated fixed rate debt. The agreements are designated as net investment hedges for accounting purposes. Accordingly, the gains or losses on these derivative instruments are included in the foreign currency translation component of other comprehensive income until the net investment is sold, diluted, or liquidated. Coupons received for the cross currency swaps are excluded from the net investment hedge effectiveness assessment and are recorded in interest expense, net on the Consolidated Statements of Comprehensive Income (Loss) asIncome. Coupon interest from cross currency swap agreement recorded in interest expense, net was $2.9 million for each of the years ended December 31, 2017.2022, 2021, and 2020.

Ineffectiveness from cash flow hedges, all of which are interest rate swaps, was immaterial as of At December 31, 2017.2022, the fair value of these derivatives designated as net investment hedges were recorded in the Balance Sheet as other assets of $9.9 million and as accumulated other comprehensive income, net of tax, of $7.3 million.



Refer to Note 14.16. Fair Value of Financial Instruments, for a description of how the values of the above financial instruments are determined.


Credit risk

By their nature, financial instruments involve risk including credit risk for non-performance by counterparties. Financial instruments that potentially subject usthe Company to credit risk primarily consist of trade receivables and derivative contracts. We manageThe Company manages the credit risk on financial instruments by transacting only with financially secure counterparties, requiring credit approvals and establishing credit limits, and monitoring counterparties’ financial condition. OurThe Company's maximum exposure to credit loss in the event of non-performance by the counterparty, for all receivables and derivative contracts as of December 31, 2022, is limited to the amount drawn and outstanding on the financial instrument. Allowances for losses are established based on collectability assessments.

NOTE 14.16. FAIR VALUE OF FINANCIAL INSTRUMENTS


The fair value framework requires the categorization of assets and liabilities into three levels based upon the assumptions (inputs) used to price the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3 generally requires significant management judgment. The three levels are defined as follows:


•Level 1: Unadjusted quoted prices in active markets for identical assets and liabilities that the Company can assess at the measurement date.
•Level 2: Observable inputs other than those included in Level 1 that are observable for the asset or liability, either directly or indirectly. For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets.
•Level 3: Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability.


Financial assets and financial liabilities measured at fair value on a recurring basis are as follows:

As of December 31, 2022As of December 31, 2021
(In millions)TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3
Assets:
Investments$12.1 $12.1 $— $— $13.5 $13.5 $— $— 
Derivatives34.3 — 34.3 18.4 — 18.4 
Total assets$46.4 $12.1 $34.3 $— $31.9 $13.5 $18.4 $— 
Liabilities:
Derivatives$7.2 $— $7.2 $— $9.4 $— $9.4 $— 
Total liabilities$7.2 $— $7.2 $— $9.4 $— $9.4 $— 

As of December 31, 2017 As of December 31, 2016
(In millions)Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3
Assets:
 
 
 
 
 
 
 
Investments$13.1
 $13.1
 $—
 $—
 $11.9
 $11.9
 $—
 $—
Derivatives5.2
 —
 5.2
 —
 7.2
 —
 7.2
 —
Total assets$18.3
 $13.1
 $5.2
 $—
 $19.1
 $11.9
 $7.2
 $—


 
 
 
 
 
 
 
Liabilities:
 
 
 
 
 
 
 
Derivatives$5.5
 $—
 $5.5
 $—
 $5.0
 $—
 $5.0
 $—
Contingent Consideration—
 —
 —
 —
 0.8
 —
 —
 0.8
Total liabilities$5.5
 $—
 $5.5
 $—
 $5.8
 $—
 $5.0
 $0.8


Investments represent securities held in a trust for the non-qualified deferred compensation plan. Investments are classified as trading securities and are valued based on quoted prices in active markets for identical assets that we havethe Company has the ability to access.
76

Investments are reported separately in Other assets on the consolidated balance sheet.Balance Sheets. Investments include an unrealized loss of $3.9 million as of December 31, 2022 and unrealized gain of $0.5 million as of December 31, 2017 and an unrealized gain of $0.6 million as of December 31, 2016.2021.


We useThe Company uses the income approach to measure the fair value of derivative instruments on a recurring basis. This approach calculates the present value of the future cash flow by measuring the change between the derivative contract rate and the published market indicative currency rate, multiplied by the contract notional values, and applying an appropriate discount rate as well as a factor of credit risk.


The carrying amounts of cash and cash equivalents, trade receivables and payables, as well as financial instruments included in other current assets and other current liabilities, approximate fair values because of their short-term maturities.



The carrying values and the estimated fair values of our debt financial instruments as of December 31 are as follows:

20222021
(In millions)Carrying
Value		Estimated
Fair Value		Carrying
Value		Estimated
Fair Value
Convertible senior notes$394.9 $344.7 $392.7 $448.8 
Revolving credit facility, expires December 14, 2026584.6 584.6 282.9 282.9 
Other0.6 0.6 — — 

 2017 2016 
(In millions)
Carrying
Value
 
Estimated
Fair Value
 
Carrying
Value
 
Estimated
Fair Value
 
Revolving credit facility, expires February 10, 2020$230.5
 $230.5
 $342.1
 $342.1
 
Term loan due February 10, 2020150.0
 150.0
 150.0
 150.0
 
Brazilian loan due October 16, 2017—
 —
 1.5
 1.4
 
Foreign credit facilities2.7
 2.7
 4.4
 4.4
 
Other0.2
 0.2
 1.2
 1.2
 

There was no active or observable market for our fixed rate Brazilian loans. Therefore, the estimated fair value was based on discounted cash flows using current interest rates available for debt with similar terms and remaining maturities. The estimates of the all-in interest rate for discounting the loans are based on a broker quote for loans with similar terms. We do not have a rate adjustment for risk profile changes, covenant issues or credit rating changes, therefore the broker quote is deemed to be the closest approximation of current market rates. The carrying values of the remaining borrowingsCompany's revolving credit facility recorded in long-term debt on the Balance Sheet approximate their fair values due to their variable interest rates. The fair value of the Convertible senior notes is estimated using Level 2 inputs as they are not registered securities nor listed on any securities exchange but may be traded by qualified institutional buyers.

NOTE 15.17. COMMITMENTS AND CONTINGENCIES


In the normal course of our business, we arethe Company is at times subject to pending and threatened legal actions, some for which the relief or damages sought may be substantial. Although we arethe Company is not able to predict the outcome of such actions, after reviewing all pending and threatened actions with counsel and based on information currently available, management believes that the outcome of such actions, individually or in the aggregate, will not have a material adverse effect on the results of operations or financial position of our Company.position. However, it is possible that the ultimate resolution of such matters, if unfavorable, may be material to the results of operations in a particular future period as the time and amount of any resolution of such actions and its relationship to the future results of operations are not currently known.


Liabilities are established for pending legal claims only when losses associated with the claims are judged to be probable, and the loss can be reasonably estimated. In many lawsuits and arbitrations, it is not considered probable that a liability has been incurred or not possible to estimate the ultimate or minimum amount of that liability until the case is close to resolution, in which case no liability would be recognized until that time.

In 2013, we received a notice of examination from the Delaware Department of Finance commencing an examination of our books and records to determine compliance with Delaware unclaimed property law. The examination was not complete when, in 2017, Delaware promulgated a law which permitted companies an election to convert an examination to a review under the Secretary of State’s voluntary disclosure agreement program. In December 2017, we elected this alternative and are in the process of meeting the requirements under the voluntary disclosure agreement program. The requirements include reviewing our books and records and filing any previously unfiled reports for all unclaimed property presumed unclaimed, under the law, from 2003.
We are required to work with the Secretary of State to complete this exercise by December 2019. We are not able to estimate whether we have significant unclaimed property obligations at this time.
Guarantees and Product Warranties

In the ordinary course of business with customers, vendors and others, we issuethe Company issues standby letters of credit, performance bonds, surety bonds and other guarantees. These financial instruments, which totaled approximately $175.8$136.8 million at December 31, 2017,2022, represent guarantees of our future performance. WeThe Company also havehas provided approximately $10.5$6.1 million of bank guarantees and letters of credit to secure a portion of ourits existing financial obligations. The majority of these financial instruments expire within two years; we expectthe Company expects to replace them through the issuance of new or the extension of existing letters of credit and surety bonds.


In some instances, we guarantee ourthe Company guarantees its customers’ financing arrangements. We areThe Company is responsible for payment of any unpaid amounts but will receive indemnification from third parties for between seventy-five and ninety-five percent of the contract values. In addition, wethe Company generally retainretains recourse to the equipment sold. As of December 31, 2017,2022, the gross value of such arrangements was $7.7$2.1 million, of which ourthe Company's net exposure under such guarantees was $0.6$0.3 million.


We provideThe Company provides warranties of various lengths and terms to certain of our customers based on standard terms and conditions and negotiated agreements. We provideThe Company provides for the estimated cost of warranties at the time revenue is recognized for products where reliable, historical

experience of warranty claims and costs exists. WeThe Company also provideprovides a warranty liability when additional specific warranty for significant claims for which initial estimatesobligations are not likely to be sufficient.identified. The warranty obligation reflected in other current liabilities in the consolidated balance sheets is based on historical experience by product and considers failure rates and the related costs in correcting a product failure. Warranty cost and accrual information iswere as follows:


77

(In millions)2017 2016 (In millions)20222021
Balance at beginning of year$14.5
 $12.5
 
Balance at beginning of the yearBalance at beginning of the year$12.7 $11.5 
Expenses for new warranties12.7
 13.4
 Expenses for new warranties13.7 12.6 
Adjustments to existing accruals(0.4) (0.3) Adjustments to existing accruals(0.6)(0.9)
Claims paid(15.2) (11.2) Claims paid(11.6)(10.5)
Added through acquisition2.4
 0.3
 Added through acquisition1.3 0.3 
Translation0.5
 (0.2) Translation(0.4)(0.3)
Balance at end of year$14.5
 $14.5
 Balance at end of year$15.1 $12.7 


Leases
WeNOTE 18. LEASES

Lessee Accounting
The components of the Company's lease office space, manufacturing facilitiescosts for the years ended December 31, were as follows:

(In millions)202220212020
Fixed lease cost$16.6 $15.2 $14.7 
Variable lease cost3.1 2.1 1.6 
Total operating lease cost$19.7 $17.3 $16.3 

Included within operating lease costs are short-term lease costs, which were $1.8 million, $1.3 million, and various types of manufacturing$1.0 million for the years ended December 31, 2022, 2021, and data processing equipment. Leases of real estate generally provide that we pay2020, respectively, and sublease income which was immaterial for repairs, property taxesthe years ended December 31, 2022, 2021, and insurance. Substantially all leases are classified as operating2020. The Company's finance lease cost was immaterial for the years ended December 31, 2022, 2021, and 2020.

Supplemental cash flow information related to the Company's leases for accounting purposes. Rent expense under operatingthe years ended December 31, was as follows:

(In millions)202220212020
Operating cash flows from operating leases$13.7 $13.3 $12.9 
Right-of-use assets obtained in exchange for new operating lease liabilities$12.2 $19.1 $4.8��

Financing cash flows from finance leases amountedand right-of-use assets obtained in exchange for new finance lease liabilities were immaterial for the years ended December 31, 2022, 2021, and 2020.

Supplemental balance sheet information related to $5.3 million, $6.2 million and $8.9 million in 2017, 2016 and 2015, respectively.

Future minimum lease payments under non-cancelable operatingthe Company's leases as of December 31, 2017,was as follows:
(In millions)Balance Sheet Classification20222021
Lease ROU assets:
OperatingOther assets$40.2 $33.5 
Finance (a)
Net property, plant and equipment4.3 3.2 
Total lease ROU assets$44.5 $36.7 
Lease liabilities:
Current:
OperatingOther current liabilities$11.1 $10.2 
Finance (a)
Other current liabilities0.6 — 
Long-term:
OperatingOther liabilities31.1 25.2 
Finance (a)
Other liabilities0.9 — 
Total lease liabilities$43.7 $35.4 
(a)     Finance lease includes real estate leases for which the Company is a lessee for an indefinite lease term. These finance leases have no lease liability outstanding as of December 31, 2022 as no amounts are due under the lease.

78

The following table presents the weighted-average remaining lease term and discount rates for the leases for which the Company is the lessee:
(In millions)20222021
Weighted-average remaining lease term (years)
Operating leases5.14.5
Finance leases(a)
3.2— 
Weighted-average discount rate 
Operating leases4.7%4.2%
Finance leases(a)
4.8%—
(a)     Excludes real estate finance leases, for which the Company is a lessee for an indefinite lease term and has no lease liability outstanding as of December 31, 2022.

The majority of ROU assets and lease liabilities, approximately 86%, relate to real estate leases, with the remaining amount primarily comprised of vehicle leases.

Maturity of operating and finance lease liabilities as of December 31, 2022, in millions:
Operating LeasesFinance Leases
Year 1(a)
$12.8 $0.6 
Year 29.8 0.5 
Year 38.3 0.3 
Year 45.3 0.1 
Year 53.8 0.1 
After Year 58.0 — 
Total lease payments$48.0 $1.6 
Less: Interest on lease payments(5.8)(0.1)
Present value of lease liabilities$42.2 $1.5 
(a) Represents the next 12 months

Refer to Note 22. Related Party Transactions for details of operating lease agreements with related parties.
Lessor Accounting
Operating Leases:

The following fiscal years were:tables provide the required information regarding operating leases for which the Company is the lessor.


Operating Lease Revenue:
(In millions)December 31, 2022December 31, 2021December 31, 2020
Fixed payment revenue$65.5 $66.3 $66.7 
Variable payment revenue33.1 24.9 14.0 
Total$98.6 $91.2 $80.7 

Operating Lessor Maturity Analysis as of December 31, 2022, in millions:
Year 1(a)
$50.3 
Year 225.1 
Year 323.3 
Year 427.9 
Year 513.5 
After Year 513.0 
Total lease receivables$153.1 
(a) Represents the next 12 months
79

(In millions)
Total
Amount
 2018 2019 2020 2021 2022 After 2023 
Operating lease obligations$41.4
 $11.6
 $7.4
 $6.4
 $5.7
 $4.1
 $6.2
 

Sales-Type Leases:
Sales-Type Lessor Maturity Analysis as of December 31, 2022, in millions:
Year 1(a)
$5.4 
Year 20.5 
Year 30.2 
After Year 30.2 
Total lease receivables$6.3 
(a) Represents the next 12 months

Sales-type lease revenue was $4.9 million, $11.7 million, and $8.3 million for the years ended December 31, 2022, 2021, and 2020 respectively.

Our net investment in sales-type leases were classified in the Consolidated Balance Sheets as of December 31, as follows:
(In millions)20222021
Trade receivables, net of allowances$5.4 $5.0 
Other assets0.9 2.5 
Total$6.3 $7.5 
80

NOTE 16.19. BUSINESS SEGMENTS


Operating segments for the Company are determined based on information used by the chief operating decision maker (CODM) in deciding how to evaluate performance and allocate resources to each of the segments. JBT’s CODM is the Chief Executive Officer (CEO). While there are many measures the CEO reviews in this capacity, the key segment measures reviewed include operating profit, operating income margin,EBITDA, adjusted when applicable, and EBITDA.EBITDA margins.
In the third quarter of 2017, we changed the internal structure of our management team; insofar that it increased the number of operating segments, as defined by ASC 280, Segment Reporting, for the Company. Although the number of operating segments has increased from prior periods, we have aggregated multiple operating segments into one reportable segment, FoodTech, as they exhibit similar long-term operational, financial and economic characteristics. As such, our reportable segments remain the same and prior period disclosures are still comparable.

Our reportableReportable segments are:


JBT •FoodTech—designs, manufacturesprovides comprehensive solutions throughout the food production value chain extending from primary processing through packaging systems for a large variety of food and beverage groups, including poultry, beef, pork, seafood, ready-to-eat meals, fruits, vegetables, dairy, bakery, pet foods, soups, sauces, plant-based meats, juices, and carbonated beverages.

•AeroTech— supplies customized solutions and services technologically sophisticated food processing systems used for among other things, fruit juice production, frozen food production, in-container food production, automated systems and convenience food preparation byapplications in the food industry.

JBT AeroTech—designs, manufactures and services technologically sophisticatedair transportation industry, including airport ground support and gate equipment and provides services for airport authorities;authorities, airlines, airfreight, and ground handling companies; thecompanies, militaries and defense contractors and other industries.contractors.


Total revenue by segment includes intersegment sales, which are made at prices that reflect, as nearly as practicable, the market value of the transaction. Segment operating profit is defined as total segment revenue less segment operating expenses. The following items have been excluded in computing segment operating profit: corporate expense, restructuring costs, pension expense, other than service cost, interest income and expense, and income taxes. See the table below for further details on corporate expense.



Segment revenue and segment operating profit


Business segment information is as follows:
(In millions)202220212020
Revenue
FoodTech$1,590.6 $1,400.4 $1,234.5 
AeroTech575.7 467.5 493.3 
Other revenue and intercompany eliminations(0.3)0.4 — 
Total revenue$2,166.0 $1,868.3 $1,727.8 
Income before income taxes
Segment operating profit:
FoodTech$211.5 $187.0 $170.6 
AeroTech43.5 32.6 52.9 
Total segment operating profit255.0 219.6 223.5 
Corporate items:
Corporate expense (1)
79.6 53.9 48.3 
Restructuring expense (2)
7.0 5.6 12.1 
Operating income168.4 160.1 163.1 
Pension (income) expense, other than service cost— (1.3)3.7 
Net interest expense14.2 8.7 13.9 
Net income before income taxes154.2 152.7 145.5 
Provision for income taxes23.5 34.3 36.7 
Net income$130.7 $118.4 $108.8 

(1)Corporate expense generally includes corporate staff-related expense, stock-based compensation, LIFO adjustments, certain foreign currency-related gains and losses, and the impact of unusual or strategic transactions not representative of segment operations.

(2)Refer to Note 20. Restructuring for further information on restructuring expense.
81

(In millions)2017 2016 2015 
Revenue      
JBT FoodTech$1,171.9
 $928.0
 $725.1
 
JBT AeroTech463.0
 422.5
 383.1
 
Intercompany eliminations0.2
 —
 (0.9) 
Total revenue$1,635.1
 $1,350.5
 $1,107.3
 
       
Income before income taxes      
Segment operating profit:      
JBT FoodTech$139.1
 $113.2
 $85.4
 
JBT AeroTech50.7
 45.1
 38.2
 
Total segment operating profit189.8
 158.3
 123.6
 
Corporate items:      
Corporate expense(1)
42.3
 42.6
 34.6
 
Restructuring expense(2)
1.7
 12.3
 —
 
Net interest expense13.6
 9.4
 6.8
 
Total corporate items57.6
 64.3
 41.4
 
Income from continuing operations before income taxes132.2
 94.0
 82.2
 
Provision for income taxes50.1
 26.0
 26.2
 
Income from continuing operations82.1
 68.0
 56.0
 
Loss from discontinued operations, net of income taxes1.6
 0.4
 0.1
 
Net income$80.5
 $67.6
 $55.9
 

(1)Corporate expense generally includes corporate staff-related expense, stock-based compensation, pension and other post-retirement benefits expenses not related to service, LIFO adjustments, certain foreign currency-related gains and losses, and the impact of unusual or strategic transactions not representative of segment operations.

(2)
Refer to Note 17. Restructuring for further information on restructuring expense.



Segment operating capital employed and segment assets

(In millions)202220212020
Segment operating capital employed (1):
FoodTech$1,530.2 $1,310.2 $1,145.4 
AeroTech172.4 184.1 208.1 
Total segment operating capital employed1,702.6 1,494.3 1,353.5 
Segment liabilities included in total segment operating capital employed (2)
711.6 522.0 406.1 
Corporate (3)
169.9 125.1 46.3 
Total assets$2,584.1 $2,141.4 $1,805.9 
Segment assets:
FoodTech$2,129.9 $1,730.9 $1,468.9 
AeroTech333.7 285.4 290.7 
Total segment assets2,463.6 2,016.3 1,759.6 
Corporate (3)
120.5 125.1 46.3 
Total assets$2,584.1 $2,141.4 $1,805.9 

(In millions)2017 2016 2015 
Segment operating capital employed(1):
      
JBT FoodTech$802.2
 $654.2
 $414.7
 
JBT AeroTech157.5
 125.9
 114.1
 
Total segment operating capital employed959.7
 780.1
 528.8
 
Segment liabilities included in total segment operating capital employed(2)
405.6
 365.2
 322.6
 
Corporate(3)
26.1
 42.1
 24.7
 
Total assets$1,391.4
 $1,187.4
 $876.1
 
       
Segment assets:      
JBT FoodTech$1,134.7
 $950.5
 $663.1
 
JBT AeroTech230.6
 194.8
 188.9
 
Intercompany eliminations—
 —
 (0.6) 
Total segment assets1,365.3
 1,145.3
 851.4
 
Corporate(3)
26.1
 42.1
 24.7
 
Total assets$1,391.4
 $1,187.4
 $876.1
 
(1)Management views segment operating capital employed, which consists of segment assets, net of its liabilities, as the primary measure of segment capital. Segment operating capital employed excludes debt, pension liabilities, restructuring reserves, income taxes and LIFO inventory reserves.


(1)Management views segment operating capital employed, which consists of segment assets, net of its liabilities, as the primary measure of segment capital. Segment operating capital employed excludes debt, pension liabilities, restructuring reserves, income taxes and LIFO inventory reserves.
(2)Segment liabilities included in total segment operating capital employed consist of trade and other accounts payable, advance and progress payments, accrued payroll and other liabilities.
(3)Corporate includes cash, LIFO inventory reserves, income tax balances, investments, and property, plant and equipment not associated with a specific segment.

(2)Segment liabilities included in total segment operating capital employed consist of trade and other accounts payable, advance and progress payments, accrued payroll and other liabilities.

(3)Corporate includes cash, LIFO inventory reserves, restructuring reserves, income tax balances, investments, and property, plant and equipment not associated with a specific segment.

Geographic segment information

Geographic segment sales were identified based on the location where ourthe Company's products and services were delivered. Geographic segment long-lived assets include property, plant and equipment, net and certain other non-current assets.

(In millions)202220212020
Revenue (by location of customers):
United States$1,393.6 $1,137.5 $1,034.0 
All other countries772.4 730.8 693.8 
Total revenue$2,166.0 $1,868.3 $1,727.8 

(In millions)202220212020
Long-lived assets:
United States$262.2 $212.9 $181.9 
United Kingdom24.2 27.5 29.8 
All other countries82.8 80.0 79.9 
Total long-lived assets$369.2 $320.4 $291.6 

82
(In millions)2017 2016 2015 
Revenue (by location of customers):      
United States$967.1
 $807.7
 $600.9
 
All other countries668.0
 542.8
 506.4
 
Total revenue$1,635.1
 $1,350.5
 $1,107.3
 


(In millions)2017 2016 2015 
Long-lived assets:      
United States$161.6
 $154.1
 $132.7
 
Brazil13.9
 12.6
 9.5
 
All other countries75.7
 57.8
 49.1
 
Total long-lived assets$251.2
 $224.5
 $191.3
 


Other business segment information

Capital ExpendituresDepreciation and Amortization
(In millions)202220212020202220212020
FoodTech$37.3 $35.1 $27.9 $72.3 $69.0 $63.6 
AeroTech2.8 1.6 2.1 4.7 4.5 5.5 
Corporate47.5 17.4 4.3 4.1 3.3 2.7 
Total$87.6 $54.1 $34.3 $81.1 $76.8 $71.8 

83
 Capital Expenditures Depreciation and Amortization 
Research and Development
Expense
 
(In millions)2017 2016 2015 2017 2016 2015 2017 2016 2015 
JBT FoodTech$34.6
 $30.7
 $31.9
 $46.8
 $34.6
 $25.5
 $21.8
 $18.0
 $13.5
 
JBT AeroTech2.6
 3.9
 3.5
 2.5
 2.2
 2.0
 6.9
 5.6
 4.7
 
Corporate0.7
 2.5
 2.3
 2.4
 1.7
 2.1
 —
 —
 —
 
Total$37.9
 $37.1
 $37.7
 $51.7
 $38.5
 $29.6
 $28.7
 $23.6
 $18.2
 


NOTE 17.20. RESTRUCTURING


Restructuring costscharges primarily consist of employee separation benefits under our existing severance programs, foreign statutory termination benefits, certain one-time termination benefits, contract termination costs, asset impairment charges and other costs that are associated with restructuring actions. Certain restructuring charges are accrued prior to payments made in accordance with applicable guidance. For such charges, the amounts are determined based on estimates prepared at the time the restructuring actions were approved by management. Inventory write offs due to restructuring are reported in Cost of products and are included in each segment's operating profit given the nature of the item. All other restructuring charges that are reported as Restructuring expenses are excluded from the calculation of each segment's operating profit.


In the firstthird quarter of 2016, we2020, the Company implemented a restructuring plan ("2020 restructuring plan") for manufacturing capacity rationalization affecting both the FoodTech and AeroTech segments. The Company completed the 2020 restructuring plan as of June 30, 2022. The total cost in connection with the 2020 restructuring plan was $11.0 million for FoodTech and $6.0 million for AeroTech.

In the third quarter of 2022, the Company implemented a restructuring plan (the "2022/2023 restructuring plan") to optimize the overall FoodTech cost structure on a global basis. The initiatives under this plan will include streamlining operations and enhancing our optimization program to realign FoodTech’s Protein business in North Americageneral and Liquid Foods business in Europe, accelerate JBT’s strategic sourcing initiatives,administrative infrastructure. As of December 31, 2022, the cost of this plan is $5.4 million and consolidate smaller facilities. Thethe total estimated cost in connection with this plan is approximately $12.0 million.in the range of $8.0 million to $10.0 million expected to be recognized by the end of 2023.

During the fourth quarter of 2016, in connection with our acquisition of Tipper Tie, we implemented a restructuring plan to consolidate certain facilities and optimize our general and administrative infrastructure subsequent to a FoodTech acquisition. The total estimated cost in connection with this plan is approximately $4.0 million.


The following table details the amountscumulative restructuring charges reported in Restructuring expense onoperating income for the consolidated statement of income2022/2023 and 2020 restructuring plans since the implementation of these plans:  

Cumulative AmountAs of the Quarter EndedCumulative Amount
(In millions)Balance as of December 31, 2021March 31, 2022June 30, 2022September 30, 2022December 31, 2022Balance as of December 31, 2022
2020 restructuring plan
Severance and related expense$9.2 $0.2 $0.7 $0.1 $0.2 $10.4 
Inventory write-off2.1 0.2 — — — 2.3 
Employee overlap costs2.1 0.2 0.1 — — 2.4 
Other3.8 0.2 0.1 0.1 — 4.2 
2022/2023 restructuring plan
Severance and related expense— — — 1.3 4.4 5.7 
Total Restructuring charges$17.2 $0.8 $0.9 $1.5 $4.6 $25.0 

Restructuring charges, net of related release of liability, is reported within the following financial statement line items of the accompanying Consolidated Statements of Income:
Twelve Months Ended December 31,
(In millions)202220212020
Cost of products(1)
$0.2 $0.2 $1.9 
Restructuring expense7.0 5.6 12.1 
Total restructuring charge$7.2 $5.8 $14.0 

(1) Restructuring charge reported in Cost of products is related to an inventory write-off resulting from the 2020 restructuring plan.


84
 Cumulative Amount For the Quarter Ended Cumulative Amount
(In millions)As of December 31, 2016 March 31, 2017 June 30, 2017 September 30, 2017 December 31, 2017 As of December 31, 2017
Severance and related expense$6.1
 $0.5
 $0.1
 $—
 $—
 $6.7
Other6.2
 0.2
 0.6
 0.3
 0.6
 7.9
Total restructuring charges$12.3
 $0.7
 $0.7
 $0.3
 $0.6
 $14.6


The restructuring expense is associated with the FoodTech segment, and is excluded from our calculation of segment operating profit. Expenses incurred during the three months ended December 31, 2017 primarily relate to costs to streamline operations and consolidate facilities as a direct result of our plan.





Liability balances for restructuring activities are included in other current liabilities in the accompanying consolidated balance sheets.Balance Sheets. The table below details the activity in 2017:restructuring activities for the year ended December 31, 2022:

Impacts to earnings
(In millions)Balance as of December 31, 2021Charged to EarningsReleasesCash PaymentsBalance as of December 31, 2022
2020 restructuring plan
Severance and related expense$0.7 $1.2 $(0.3)$(1.4)$0.2 
Other0.1 0.7 — (0.8)— 
2022/2023 restructuring plan
Severance and related expense— 5.7 (0.3)(1.1)4.3 
Total$0.8 $7.6 $(0.6)$(3.3)$4.5 

(In millions)Balance as of
December 31, 2016		 
Charged to
Earnings
 Payments Made Release of Liability Balance as of
December 31, 2017
Severance and related expense$8.3
 $0.5
 $(4.9) $(0.7) $3.2
Other0.6
 1.8
 (2.4) —
 —
Total$8.9
 $2.3
 $(7.3) $(0.7) $3.2

WeThe Company released $0.7$0.6 million of the liability during the year ended December 31, 20172022 which weit no longer expectexpects to pay in connection with this planthe restructuring plans due to actual severance payments differing from the original estimates and natural attrition of employees.


NOTE 18. QUARTERLY INFORMATION (UNAUDITED)21. MANAGEMENT SUCCESSION COSTS

(In millions, except per share data and common stock prices)2017 2016 
 
4th
Qtr.
 
3rd
Qtr.
 
2nd
Qtr.
 
1st
Qtr.
 
4th
Qtr.
 
3rd
Qtr.
 
2nd
Qtr.
 
1st
Qtr.
 
Revenue$483.7
 $420.8
 $386.1
 $344.5
 $405.0
 $349.6
 $328.8
 $267.1
 
Cost of sales346.9
 299.3
 271.3
 246.9
 291.0
 255.5
 233.0
 190.3
 
Income from continuing operations19.8
 26.4
 18.3
 17.6
 23.4
 20.6
 18.8
 5.2
 
Loss from discontinued operations, net of tax0.4
 0.6
 0.4
 0.2
 0.3
 —
 —
 0.1
 
Net income$19.4
 $25.8
 $17.9
 $17.4
 $23.1
 $20.6
 $18.8
 $5.1
 
Basic earnings per share(1):
                
Income from continuing operations$0.62
 $0.83
 $0.57
 $0.59
 $0.79
 $0.70
 $0.64
 $0.18
 
Loss from discontinued operations, net of tax(0.01) (0.02) (0.01) (0.01) (0.01) —
 —
 (0.01) 
Net income$0.61
 $0.81
 $0.56
 $0.58
 $0.78
 $0.70
 $0.64
 $0.17
 
Diluted earnings per share(1):
                
Income from continuing operations$0.61
 $0.82
 $0.57
 $0.58
 $0.78
 $0.69
 $0.63
 $0.17
 
Loss from discontinued operations, net of tax(0.01) (0.02) (0.01) (0.01) (0.01) —
 —
 —
 
Net income$0.60
 $0.80
 $0.56
 $0.57
 $0.77
 $0.69
 $0.63
 $0.17
 
Dividends declared per share$0.10
 $0.10
 $0.10
 $0.10
 $0.10
 $0.10
 $0.10
 $0.10
 
Weighted average shares outstanding                
Basic31.9
 31.9
 31.9
 30.0
 29.4
 29.4
 29.4
 29.5
 
Diluted32.3
 32.3
 32.3
 30.4
 29.9
 29.8
 29.8
 29.8
 
Common stock sales price                
High$120.55
 $101.40
 $99.15
 $92.05
 $93.55
 $71.00
 $65.67
 $57.48
 
Low$99.09
 $85.09
 $82.45
 $80.70
 $70.55
 $59.90
 $51.20
 $41.35
 

(1)Basic and diluted earnings per share (EPS) are computed independently for each of the periods presented. Accordingly, the sum of the quarterly EPS amounts may not agree to the annual total.
NOTE 19. SUBSEQUENT EVENTS


On February 22, 2018,September 24, 2020, the Company initiated a management succession plan after Tom Giacomini, the Company's former CEO, resigned from the Company. In connection with this succession plan, the Company entered into a separation agreement with Mr. Giacomini that provided for a lump sum separation payment of $6.4 million. This separation cost of $6.4 million was paid and recognized as Selling, general, and administrative expense in the consolidated statement of income during the year ended December 31, 2020.

In connection with Mr. Giacomini’s departure from the Company, 96,427 nonvested shares under the Company’s stock-based compensation plans were forfeited. Accordingly, the Company recorded a benefit of $2.9 million associated with the reversal of previously accrued amounts for these unvested shares as stock based compensation expense within Selling, general, and administrative expense during the year ended December 31, 2020.

In December 2020, our Board of Directors approvednamed Brian Deck, former Executive Vice President and Chief Financial Officer, as the President and Chief Executive Officer, and Matt Meister, former Vice President and Chief Financial Officer for JBT Protein, as the Executive Vice President and Chief Financial Officer of the Company. In connection with these transitions, the Company recognized a quarterly cash dividendone-time compensation cost of $0.10 per share$0.5 million and other related costs of outstanding common stock. $0.8 million as Selling, general, and administrative expense in the consolidated statement of income during the year ended December 31, 2020.
NOTE 22. RELATED PARTY TRANSACTIONS

The dividend will be paid on March 19, 2018Company is a party to stockholdersagreements to lease manufacturing facilities from entities owned by certain of record at the closeCompany's employees who were former owners or employees of business on March 5, 2018.acquired businesses. As of December 31, 2022, the operating lease right-of-use asset and the lease liability related to these agreements is $4.0 million and $4.2 million, respectively.


85



Schedule II—Valuation and Qualifying Accounts

(In thousands)Additions
DescriptionBalance at
Beginning
of Period		Charged to
Costs and
Expenses
Charged to Other Accounts(a)
Deductions and Other(b)
Balance
at End
of Period
Year ended December 31, 2020:
Allowance for doubtful accounts$4,324 $1,846 $954 $1,845 $5,279 
Valuation allowance for deferred tax assets$3,898 $— $719 $— $4,617 
Year ended December 31, 2021:
Allowance for credit losses$5,279 $2,027 $— $1,260 $6,046 
Valuation allowance for deferred tax assets$4,617 $— $270 $— $4,887 
Year ended December 31, 2022:
Allowance for credit losses$6,046 $4,164 $— $2,227 $7,983 
Valuation allowance for deferred tax assets$4,887 $2,180 $— $3,203 $3,864 
(In thousands)  Additions    
Description
Balance at
beginning
of period
 
Charged to
costs and
expenses
 
Charged to other accounts(a)
 
Deductions and other(a)
 
Balance
at end
of period
Year ended December 31, 2015:         
Allowance for doubtful accounts$3,042
 $471
 $—
 $1,450
 $2,063
Valuation allowance for deferred tax assets$—
 $—
 $—
 $—
 $—
Year ended December 31, 2016:         
Allowance for doubtful accounts$2,063
 $2,060
 $—
 $1,054
 $3,069
Valuation allowance for deferred tax assets$—
 $—
 $—
 $—
 $—
Year ended December 31, 2017:         
Allowance for doubtful accounts$3,069
 $288
 $—
 $147
 $3,210
Valuation allowance for deferred tax assets$—
 $—
 $2,654
 $—
 $2,654


(a)    "Additions charged to other accounts" includes allowances added through business combinations.combinations and allowance for credit losses charged to retained earnings upon adoption of ASC 326 as of January 1, 2020.


(b)    “Deductions and other” includes translation adjustments, write-offs, net of recoveries, and reductions in the allowances credited to expense.

86
See accompanying Report of Independent Registered Public Accounting Firm.


ITEM 9.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE


None.
87

ITEM 9A.    CONTROLS AND PROCEDURES


(a)Disclosure Controls and Procedures
(a)Disclosure Controls and Procedures
As of the end of the period covered by this Annual Report on Form 10-K, wemanagement of the Company carried out an evaluation of the effectiveness of the design and operation of ourits disclosure controls and procedures. Based upon that evaluation, ourthe Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2022 to ensure that information required to be disclosed by us in reports we filethe Company files or submitsubmits under the Exchange Act is (1) recorded, processed, summarized and reported within the time periods specified in SECthe Commission’s rules and forms, and (2) accumulated and communicated to our management, including ourthe Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.


(b)Management’s Annual Report on Internal Control over Financial Reporting
(b)Management’s Annual Report on Internal Control over Financial Reporting
Internal control over financial reporting is(as defined in Rule 13a-15(f) promulgated under the Securities Exchange Act of 1934, as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected by the Company’s Board, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles (GAAP) and includes those policies and procedures that:

(i)pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of assets of the Company;
(ii)provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and
(iii)provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management’s report on internal control over financial reporting is set forth below and should be read with these limitations in mind.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting based upon the framework in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on that evaluation, our management concluded that the Company’s internal control over financial reporting is effective as of December 31, 2017.

During 2017, the Company completed the acquisitions of Avure Technologies, Inc., Aircraft Maintenance Support Services, Ltd., and PLF International Ltd. The net assets acquired in these transactions reflected less than 10% of the consolidated assets of JBT Corporation as of December 31, 2017. The total revenue generated by these acquired businesses since the dates of acquisition totaled less than 5% of the consolidated revenue of JBT Corporation for the year ended December 31, 2017. Management’s assessment of the Company’s internal control over financial reporting as of December 31, 2017 excluded the internal control over financial reporting of these businesses during this period while we integrated the acquirees’ existing internal control structure with JBT policies and procedures.

Attestation Report of the Registered Public Accounting Firm
KPMG LLP, the Company’s independent registered public accounting firm, has issued their report, included herein on page 82, on the effectiveness of the Company’s internal control over financial reporting.

(c)Changes in Internal Control over Financial Reporting
In the ordinary course of business, we review our system of internal control over financial reporting and make changes to our systems and processes to improve such controls and increase efficiency, while ensuring that we maintain an effective internal control environment. Changes may include such activities as implementing new, more efficient systems,

automating manual processes and updating existing systems. For example, we centralized certain administrative and transaction functions in Europe to leverage a shared services model. As a result of the transition of these accounting operations to a central location, the personnel responsible for executing controls over the processing of transactions in certain processes changed. This transition process continued throughout 2017. Management believes it took the necessary steps to maintain appropriate internal controls and to monitor their operation during the period of change. The implementation of shared services will allow us to be more efficient and further enhance our internal control over financial reporting.

We acquired multiple businesses during 2017. Our integration process includes evaluating the internal control structure, including information technology, to change certain systems, controls and/or procedures to align each business with JBT systems, controls and procedures.

Other than as noted above, there were no changes in controls identified in the evaluation for the quarter ended December 31, 2017 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act.



Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors
John Bean Technologies Corporation:

Opinion on Internal Control Over Financial Reporting
We have audited John Bean Technologies Corporation and subsidiaries (the “Company”) internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company as of December 31, 2017 and 2016, the related consolidated statements of income, comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2017, and the related notes and financial statement schedule II (collectively, the consolidated financial statements), and our report dated February 28, 2018 expressed an unqualified opinion on those consolidated financial statements.
The Company acquired Avure Technologies, Inc., Aircraft Maintenance Support Services, Ltd., and PLF International Ltd. during 2017, and management excluded from its assessment of the effectiveness of the Company’s internal control over financial reporting as of December 31, 2017, Avure Technologies, Inc.’s, Aircraft Maintenance Support Services, Ltd.’s, and PLF International Ltd.’s internal control over financial reporting associated with total assets of less than 10% of consolidated assets and total revenues of less than 5% of consolidated revenues in the consolidated financial statements of the Company as of and for the year ended December 31, 2017. Our audit of internal control over financial reporting of the Company also excluded an evaluation of the internal control over financial reporting of Avure Technologies, Inc., Aircraft Maintenance Support Services, Ltd., and PLF International Ltd.

Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting in Item 9A: Controls and Procedures. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting1934) is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reportingprinciples (GAAP) and includes those policies and procedures that (1) that:

(i)pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) Company;
(ii)provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles,GAAP, and that receipts and expenditures of the companyCompany are being made only in accordance with authorizations of management and directors of the company;Company; and (3) 
(iii)provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’sCompany’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ KPMG
Management is responsible for establishing and maintaining adequate internal control over financial reporting. Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO"). Based on that evaluation, management concluded that the Company’s internal control over financial reporting is effective as of December 31, 2022, based on the criteria in Internal Control Integrated Framework issued by the COSO.

We excluded Alco-food-machines GmbH & Co. KG ("Alco") and Bevcorp, LLC (“Bevcorp”) from our assessment of internal control over financial reporting as of December 31, 2022 because these entities were acquired by the Company in purchase business combinations during 2022. The total assets and total revenues of Alco and Bevcorp, wholly-owned subsidiaries, excluded from our assessment represent 5.3% and 2.4%, respectively, of the related consolidated amounts as of and for the year-end ended December 31, 2022.

Attestation Report of the Registered Public Accounting Firm
PricewaterhouseCoopers LLP, the Company’s independent registered public accounting firm, has audited the effectiveness of the Company’s internal control over financial reporting as of December 31, 2022, as stated in their report which is included on page 43.


Chicago, Illinois(c)Changes in Internal Control over Financial Reporting
February 28, 2018

In the ordinary course of business, the Company reviews its internal control over financial reporting and makes changes to its systems and processes to improve such controls and increase efficiency, while ensuring that the Company maintains effective internal control over financial reporting. Changes may include such activities as implementing new, more efficient systems, automating manual processes and updating existing systems.

There were no changes in our internal control over financial reporting identified in the evaluation for the quarter ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act.


88

ITEM 9B.    OTHER INFORMATION


None.
89

Item 9C.     DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not Applicable.
90

PART III
ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE


We haveThe Company has a code of ethics entitled the “Code of Business Conduct and Ethics” that applies to our employees, including our principal executive and financial officers (including ourthe principal executive officer, principal financial officer and principal accounting officer) as well as our directors. A copy of ourthe Code of Business Conduct and Ethics may be found on ourthe Company's website at www.jbtcorporation.comwww.jbtc.com under “Investor Relations –About Us / Corporate Governance”Governance and is available in print to stockholders without charge by submitting a request to the General Counsel and Assistant Secretary of JBT Corporation, 70 West Madison Street, Suite 4400, Chicago, Illinois 60602.


WeThe Company also electelects to disclose the information required by Form 8-K, Item 5.05, “Amendments to the registrant’s code of ethics, or waiver of a provision of the code of ethics,” through ourthe Company's website at www.jbtc.com, and such information will remain available on ourthe website for at least a twelve-month period.


Information regarding ourthe Company's executive officers is presented in the section entitled “Executive Officers of the Registrant”“Information about our Executive Officers” in Part I of this Annual Report on Form 10-K.


Other information required by this Item can be found in the Proxy Statement for our 2018the Company's 2023 Annual Meeting of Stockholders and is incorporated herein by reference.


91

ITEM 11.    EXECUTIVE COMPENSATION


Information required by this item can be found in the sections entitled “Director Compensation,” “Compensation Committee Interlocks and Insider Participation in Compensation Decisions,” “Executive Compensation” and "Compensation Tables and Explanatory Information" of the Proxy Statement for our 2018the Company's 2023 Annual Meeting of Stockholders and is incorporated herein by reference.


92

ITEM 12.SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Information required by this item can be found in the sections entitled “Security Ownership of John Bean Technologies Corporation” and "Compensation Tables and Explanatory Information - Securities Authorized for Issuance Under Equity Compensation Plans Table" of the Proxy Statement for our 2018the Company's 2023 Annual Meeting of Stockholders and is incorporated herein by reference.


93

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE


Information required by this item can be found in the sections entitled “Transactions with Related Persons” and “Director Independence” of the Proxy Statement for our 2018the Company's 2023 Annual Meeting of Stockholders and is incorporated herein by reference.


94

ITEM 14.    PRINCIPAL ACCOUNTANT FEES AND SERVICES


Information required by this item can be found in the section entitled “Ratification of Appointment of Independent Registered Public Accounting Firm” of the Proxy Statement for our 2018the Company's 2023 Annual Meeting of Stockholders and is incorporated herein by reference.

95

PART IV
ITEM 15.    EXHIBITS AND FINANCIAL STATEMENT SCHEDULES


(a)The following documents are filed as part of this Report:


1.Financial Statements: The consolidated financial statements required to be filed in this Annual Report on Form 10-K are listed below and appear on pages 46 through 79 herein:
1.Financial Statements: The consolidated financial statements required to be filed in this Annual Report on Form 10-K are listed below and appear on pages 47 through 86 herein:

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

4543
Consolidated Statements of Income for the Years Ended December 31, 2017, 20162022, 2021 and 2015
2020
4647
4748
4849
4950
5051
5152


2.Financial Statement Schedule: Schedule II—Valuation and Qualifying Accounts is included in this Annual Report on Form 10-K on page 80. All other schedules are omitted because of the absence of conditions under which they are required or because information called for is shown in the consolidated financial statements and notes thereto in Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K.

2.Financial Statement Schedule: Schedule II—Valuation and Qualifying Accounts is included in this Annual Report on Form 10-K on page 86. All other schedules are omitted because of the absence of conditions under which they are required or because information called for is shown in the consolidated financial statements and notes thereto in Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K.
3.Exhibits:


3.Exhibits:

See Index of Exhibits below for a list of the exhibits being filed or furnished with or incorporated by reference to this Annual Report on Form 10-K.
96

INDEX OF EXHIBITS

Exhibit NumberExhibit Description
Exhibit
Number
2.1		Exhibit Description
2.1
2.1A
3.1
3.2
Certificate of Designations of Series A Junior Participating Preferred Stock of JBT Corporation, incorporated by reference to Exhibit 3.1 to our Current Report on Form 8-K filed with the SEC on August 6, 2008.
3.3
Amended and Restated By-Laws of John Bean Technologies Corporation, incorporated by reference to Exhibit 3.3 to our Annual Report on Form 10-K filed with the SEC on March 11, 2009.
3.4
First Amendment to Amended and Restated By-Laws of John Bean Technologies Corporation, incorporated by reference to Exhibit 3.2 to our Quarterly Report on Form 10-Q filed with the SEC on May 8, 2009.

3.2
3.5
3.6
Second Amended and Restated Bylaws of John Bean Technologies Corporation. incorporated by reference to Exhibit 3.1 of the registrant’s Current Report on Form 8-K filed on August 19, 2014.
3.7
Third Amended and Restated Bylaws of John Bean Technologies Corporation incorporated by reference to Exhibit 3.7 of the registrant’s Current Report on Form 8-K filed on December 6, 2016.
4.13.3
3.4
4.1
4.2
10.1
Credit Agreement dated February 10, 2015, among John Bean Technologies Corporation, John Bean Technologies, B.V., Wells Fargo Bank, National Association, and the other lenders and parties signatories thereto, incorporated by reference to our Quarterly Report on Form 10-Q filed with the SEC on April 30, 2015.
10.1A
First Amendment to the Credit Agreement, dated as of September 15, 2015, by and among John Bean Technologies Corporation and John Bean Technologies, B.V., as borrowers, Wells Fargo Bank, National Association, as administrative agent, and the other lenders signatory thereto, incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed with the SEC on September 16, 2015.
10.1B
Second Amendment to the Credit Agreement, dated as of March 18, 2016, by and among John Bean Technologies Corporation and John Bean Technologies, B.V., as borrowers, Wells Fargo Bank, National Association, as administrative agent, and the other lenders signatory thereto, incorporated by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q filed with the SEC on April 29, 2016.
10.1C
Third Amendment to the Credit Agreement, dated as of October 20, 2016, by and among John Bean Technologies Corporation and John Bean Technologies, B.V., as borrowers, Wells Fargo Bank, National Association, as administrative agent and incremental Term-1 lender, and the other incremental Term-1 lenders signatory thereto, incorporated by reference to Exhibit 10.1C to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.24, 2022.
10.1D4.3
10.24.4
10.34.5
10.1
10.2
10.410.3
10.5
John Bean Technologies Corporation Incentive Compensation and Stock Plan, incorporated by reference to Exhibit 10.4 to our Current Report on Form 8-K filed with the SEC on August 6, 2008.1
10.5A
Form of Nonqualified Stock Option Agreement, incorporated by reference to Exhibit 10.4A to our Current Report on Form 8-K filed with the SEC on August 6, 2008.1

10.5B10.4
10.5C
Form of Long-Term Incentive Performance Share Restricted Stock Agreement, incorporated by reference to Exhibit 10.4C to our Current Report on Form 8-K filed with the SEC on August 6, 2008.1
10.5D
Form of Key Managers Restricted Stock Agreement, incorporated by reference to Exhibit 10.4D to our Current Report on Form 8-K filed with the SEC on August 6, 2008.1
10.5E
Form of Restricted Stock Agreement for Non-Employee Directors, incorporated by reference to Exhibit 10.4E to our Current Report on Form 8-K filed with the SEC on August 6, 2008.1
10.5F
Form of Performance Units Award Agreement, incorporated by reference to Exhibit 10.4F to our Current Report on Form 8-K filed with the SEC on August 6, 2008.1
10.5G
Form of Long-Term Incentive Restricted Stock Agreement, incorporated by reference to Exhibit 10.4G to our Current Report on Form 8-K filed with the SEC on August 6, 2008.1
10.5H
Form of Long-Term Incentive Restricted Stock Unit Agreement, incorporated by reference to Exhibit 10.5H to our Annual Report on Form 10-K filed with the SEC on March 3, 2011.1
10.5I
Form of Long-Term Incentive Performance Share Restricted Stock Unit Agreement, incorporated by reference to Exhibit 10.5I to our Annual Report on Form 10-K filed with the SEC on March 3, 2011.1
10.5J
Updated Form of Long-Term Incentive Restricted Stock Unit Agreement, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on March 7, 2013.1
10.5K
Updated Form of Long-Term Incentive Performance Share Restricted Stock Unit Agreement, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on March 7, 2013.1
10.5L
Form of Long-Term Incentive Performance Cash Award Agreement, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on March 7, 2013.1
10.5M
Updated Form of Long-Term Incentive Restricted Stock Unit Agreement, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on March 2, 2015.1
10.5N
Updated Form of Long-Term Incentive Performance Restricted Stock Unit Agreement, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on March 2, 2015.1
10.5O
Updated Form of Long-Term Incentive Restricted Stock Unit Agreement – Executive Officer, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on March 2, 2015.1
10.5P
Updated Form of Long-Term Incentive Performance Restricted Stock Unit Agreement – Executive Officer, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on March 2, 2015.1
10.5Q
Updated Form of Long-Term Incentive Restricted Stock Unit Agreement, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on February 29, 2016.1
10.5R
Updated Form of Long-Term Incentive Performance Restricted Stock Unit Agreement, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on February 29, 2016.1
10.5S
Updated Form of Long-Term Incentive Restricted Stock Unit Agreement - Executive Officer, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on February 29, 2016.1
10.5T
Updated Form of Long-Term Incentive Performance Restricted Stock Unit Agreement - Executive Officer, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on February 29, 2016.1

10.5U
Updated Form of Non-Employee Director Long-Term Incentive Restricted Stock Unit Agreement - Vests, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.1
10.5V
Updated Form of Non-Employee Director Long-Term Incentive Restricted Stock Unit Agreement - Separation, incorporated by reference to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.1
10.6
Amendment No. 1 to John Bean Technologies Corporation Incentive Compensation and Stock Plan, incorporated by reference to Exhibit 10.210.1 to our Quarterly Report on Form 10-Q filed with the SEC on November 14, 2008.2, 2018.12
10.6A10.5
10.6B
Amendment No. 3 to John Bean Technologies Corporation Incentive Compensation and Stock Plan, incorporated by reference to Exhibit 10.6B to our Annual Report on Form 10-K filed with the SEC on March 7, 2014.1
10.6C
Amendment No. 4 to John Bean Technologies Corporation Incentive Compensation and Stock Plan, incorporated by reference to Exhibit 10.6C to our Annual Report on Form 10-K filed with the SEC on March 2, 2015.1
10.6D
Amendment No. 5 to John Bean Technologies Corporation Incentive Compensation and Stock Plan, incorporated by reference to Exhibit 10.6D to our Annual Report on Form 10-K filed with the SEC on February 29, 2016.1
10.6E
Amendment No. 6 to John Bean Technologies Corporation Incentive Compensation and StockInvestment Plan, incorporated by reference to Exhibit 10.3 to our Quarterly Report on Form 10-Q filed with the SEC on October 28, 2016.31, 2019.12
97

10.6F10.6
10.7
JBT Corporation Non-Qualified Savings and Investment Plan, incorporated by reference to Exhibit 10.5 to our Current Report on Form 8-K filed with the SEC on August 6, 2008.1
10.7A
First Amendment of JBT Corporation Non-Qualified Savings and Investment Plan, incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed with the SEC on September 18, 2009.1
10.7B
Second Amendment of JBT Corporation Non-Qualified Savings and Investment Plan, incorporated by reference to Exhibit 10.5 to our Quarterly Report on Form 10-Q filed with the SEC on November 6, 2009.1
10.7C
Third Amendment of JBT Corporation Non-Qualified Savings and Investment Plan, incorporated by reference to Exhibit 10.7C10.21A to our Annual Report on Form 10-K filed with the SEC on March 2, 2015.2020.12
10.810.7
10.9
JBT Corporation Salaried Employees’ Equivalent Retirement Plan, incorporated by reference to Exhibit 10.7 to our Current Report on Form 8-K filed with the SEC on August 6, 2008.12
10.9A10.7A

10.9B10.7B
10.1010.8*
10.10A10.9*
10.10B10.10
10.11
JBT Corporation Employees’ Retirement Program - Part I Salaried and Nonunion Hourly Employees Retirement Program and Part II Union Hourly Employees’ Retirement Plan, incorporated by reference to Exhibit 10.5 to Amendment No. 3 to our Form 10/A filed with the SEC on July 3, 2008.1
10.11A
First Amendment of JBT Corporation Employees’ Retirement Program - Part I Salaried and Nonunion Hourly Employees Retirement Program, incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K filed with the SEC on September 15, 2009.1
10.11B
Second Amendment of JBT Corporation Employees’ Retirement Program - Part I Salaried and Nonunion Hourly Employees Retirement Plan, incorporated by reference to Exhibit 10.11B to our Annual Report on Form 10-K filed with the SEC on March 4, 2010.1
10.11C
First Amendment of JBT Corporation Employees’ Retirement Program – Part II Union Hourly Employees Retirement Plan, incorporated by reference to Exhibit 10.11C to our Annual Report on Form 10-K filed with the SEC on March 4, 2010.1
10.11D
Second Amendment of JBT Corporation Employees’ Retirement Program – Part II Union Hourly Employees Retirement Plan, incorporated by reference to Exhibit 10.11D to our Quarterly Report on Form 10-Q filed with the SEC on November 3, 2011.1
10.11E
Third Amendment of JBT Corporation Employees’ Retirement Program – Part II Union Hourly Employees Retirement Plan, incorporated by reference to Exhibit 10.11E to our Quarterly Report on Form 10-Q filed with the SEC on November 3, 2011.1
10.11F
Amended and Restated John Bean Technologies Corporation Employees’ Retirement Program - Part I Salaried and Nonunion Hourly Employees’ Retirement Program - Part II Union Hourly Employees’ Retirement Program incorporated by reference to Exhibit 10.11F to our Quarterly Report on Form 10-Q filed with the SEC on August 8, 2012.12
10.11G10.10A
10.11H10.10B
10.11I
Second Amendment of Amended and Restated John Bean Technologies Corporation Employees’ Retirement Program - Part II Union Hourly Employees’ Retirement Program incorporated by reference to Exhibit 10.11I to our Annual Report on Form 10-K filed with the SEC on March 2, 2015.1
10.11J
Second Amendment of John Bean Technologies Corporation Employee's Retirement Program - Part I Salaried and Nonunion Hourly Employees' Retirement Plan (as Amended and Restated Effective as of January 1, 2012) incorporated by reference to Exhibit 10.1 into our Quarterly Report on Form 10-Q filed with the SEC on October 29, 2015.12

10.11K10.10C
10.11L
Third Amendment of John Bean Technologies Corporation Employees' Retirement Program Part I Salaried and Nonunion Hourly Employees’ Retirement Plan (as Amended and Restated Effective as of January 1, 2012) incorporated by reference to Exhibit 10.1 into our Quarterly Report on Form 10-Q filed with the SEC on October 28, 2016.12
10.11M10.11*
10.12*
10.1210.13
10.12A
First Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.6.1 to our Quarterly Report on Form 10-Q filed with the SEC on August 5, 2009.1
10.12B
Second Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.310.1 to our Current Report on Form 8-K filed with the SEC on September 15, 2009.May 20, 2020.12
10.12C
Third Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12C to our Annual Report on Form 10-K filed with the SEC on March 4, 2010.1
10.12D
Fourth Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12D to our Annual Report on Form 10-K filed with the SEC on March 4, 2010.1
10.12E
Fifth Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12E to our Annual Report on Form 10-K filed with the SEC on March 3, 2011.1
10.12F
Amended and Restated John Bean Technologies Corporation Savings and Investment Plan incorporated by reference to Exhibit 10.12F to our Quarterly Report on Form 10-Q filed with the SEC on August 8, 2012.1
10.12G
First Amendment of Amended and Restated John Bean Technologies Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12G to our Quarterly Report on Form 10-Q filed with the SEC on August 8, 2012.1
10.12H
Second Amendment of Amended and Restated John Bean Technologies Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12H to our Annual Report on Form 10-K filed with the SEC on March 7, 2014.1
10.12I
Third Amendment of Amended and Restated John Bean Technologies Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12I to our Annual Report on Form 10-K filed with the SEC on March 7, 2014.1
10.12J
Fourth Amendment of Amended and Restated John Bean Technologies Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12J to our Annual Report on Form 10-K filed with the SEC on March 7, 2014.1
10.12K
Fifth Amendment of Amended and Restated John Bean Technologies Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12K to our Quarterly Report on Form 10-Q filed with the SEC on August 8, 2014.1
10.12L
Sixth Amendment of Amended and Restated John Bean Technologies Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12L to our Quarterly Report on Form 10-Q filed with the SEC on August 8, 2014.1

10.14
10.12M
10.12N10.14A
10.12O10.14B
10.12P
Tenth Amendment of JBT Corporation Savings and Investment Plan,Shelley Bridarolli, incorporated by reference to Exhibit 10.12P to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.1
10.12Q
Eleventh Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12Q to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.1
10.12R
Twelfth Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12R to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.1
10.12S
Thirteenth Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12S to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.1
10.12T
Fourteenth Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12T to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.1
10.12U
Fifteenth Amendment of JBT Corporation Savings and Investment Plan, incorporated by reference to Exhibit 10.12U to our Annual Report on Form 10-K filed with the SEC on February 28, 2017.1
10.12V
Sixteenth Amendment of JBT Corporation Savings and Investment Plan, incorporate by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q filed with the SEC on April 27, 2017.October 29, 2021.12
10.12W10.14C
98

10.14D
10.12X10.14E
10.13
Employment Agreement dated August 22, 2013, between JBT Corporation and Thomas W. Giacomini,Augusto Rizzolo, incorporated by reference to Exhibit 10.1 to our QuarterlyCurrent Report on Form10-QForm 8-K filed with the SEC on November 1, 2013.August 18, 2022.12
10.14
Executive Severance Plan, incorporated by reference to Exhibit 10.14 to our Annual Report on Form 10-K filed with the SEC on March 4, 2010.1
10.14A
Amended and Restated Executive Severance Plan, incorporated by reference to Exhibit 10.14A to our Annual Report on Form 10-K filed with the SEC on March 7, 2014.1
10.15
Long Term Incentive Restricted Stock Unit Purchase Agreement pursuant to the JBT Corporation Incentive Compensation and Stock Plan issued to Thomas W. Giacomini on September 10, 2013, incorporated by reference to Exhibit 10.3 to our Quarterly Report on Form 10-Q filed with the SEC on November 1, 2013.1
10.16
Long Term Incentive Restricted Stock Unit Purchase Agreement pursuant to the JBT Corporation Incentive Compensation and Stock Plan issued to Thomas W. Giacomini on September 10, 2013, incorporated by reference to Exhibit 10.4 to our Quarterly Report on Form 10-Q filed with the SEC on November 1, 2013.1

10.14F
10.17
10.17A*10.15
10.18
John Bean Technologies Corporation Retiree Welfare Benefits Plan (as amended and restated, Effective January 1, 2016), incorporated by reference to Exhibit 10.3 to our Quarterly report Form 10-Q filed with the SEC on October 29, 2015.12
10.1910.16
10.20
John Bean TechnologyTechnologies Corporation 2017 Incentive Compensation and Stock Plan, incorporated by reference to Exhibit 10.1 to our Current Report on Form 8-K filed with the SEC on May 18, 2017.12
10.20A10.16A
Form of Performance-Based Restricted Stock Unit Grant Agreement ELT Version 5 year Retirement Vesting, incorporated by reference to Exhibit 10.2 to our Current Report on Form 8-K filed with the SEC on May 18, 2017.1

2
10.20B10.16B
10.20C10.16C
10.20D
Form of Performance-Based Restricted Stock Unit Grant Agreement Non-ELT Version 10 year Retirement Vesting, incorporated by reference to Exhibit 10.5 to our Current Report on Form 8-K filed with the SEC on May 18, 2017.1
10.20E
Form of Time-Based Restricted Stock Unit Grant Agreement ELT Version 5 year Retirement Vesting, incorporated by reference to Exhibit 10.6 to our Current Report on Form 8-K filed with the SEC on May 18, 2017.12
10.20F10.16D
10.20G10.16E
10.20H
Form of Time-Based Restricted Stock Unit Grant Agreement Non-ELT Version 10 year Retirement Vesting, incorporated by reference to Exhibit 10.9 to our Current Report on Form 8-K filed with the SEC on May 18, 2017.1
10.20I
Form of Non-Employee Director Long-Term Incentive Restricted Stock Unit Agreement - Vests, incorporated by reference to Exhibit 10.10 to our Current Report on Form 8-K filed with the SEC on May 18, 2017.12
10.20J10.16F
21.1*10.17
10.17A
10.17B
10.17C
10.18*
10.18A*
99

10.18B*
10.18C*
21.1*
23.1*
Consent of Independent Registered Public Accounting Firm.

23.1*
31.1*
23.2*
31.1*
31.2*
32.1*
32.2*
101*101.INS*XBRL Instance Document
101.SCH*XBRL Taxonomy Extension Schema Document
101.CAL*XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*XBRL Taxonomy Extension Label Linkbase Document
101.PRE*XBRL Taxonomy Extension Presentation Linkbase Document
104*Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
1The following materialsschedules and exhibits to the Amended and Restated Credit Agreement have been omitted from John Bean Technologies Corporation’s Annual Report on Form 10-Kthis filing pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish to the Securities and Exchange Commission, upon request, a copy of any omitted schedule or exhibit; provided, however, that the Company may request confidential treatment pursuant to Rule 24b-2 of the Exchange Act for the year ended December 31, 2017, formatted in XBRL (eXtensible Business Reporting Language): (i) Consolidated Statements of Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Cash Flows, and (iv) Notes to Consolidated Financial Statements.any schedule or exhibit so furnished.
2
1A management contract or compensatory plan required to be filed with this report.
*Filed herewith

100

ITEM 16.    FORM 10-K SUMMARY


None.


101

SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

John Bean Technologies Corporation
(Registrant)
John Bean Technologies CorporationBy:/s/ Brian A. Deck
(Registrant)Brian A. Deck
By:/s/ THOMAS W. GIACOMINI
Thomas W. Giacomini
President and Chief Executive Officer
(Principal Executive Officer)
Date: February 28, 201823, 2023
    
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the date indicated.

102

SignatureTitleDate
/s/ BRIAN A. DECKPresident, Director andFebruary 23, 2023
Chief Executive Officer
Brian A. Deck(Principal Executive Officer)
SignatureTitleDate
/s/ THOMAS W. GIACOMINIMATTHEW J. MEISTERPresident, Director andFebruary 28, 2018
Chief Executive Officer
Thomas W. Giacomini(Principal Executive Officer)
/s/ Brian A. DeckExecutive Vice President andFebruary 28, 201823, 2023
Chief Financial Officer
Brian A. DeckMatthew J. Meister(Principal Financial Officer)
/s/ MEGAN J. RattiganJESSI L. CORCORANVice President, andCorporate ControllerFebruary 28, 201823, 2023
(Principal Accounting Officer)
Megan J. RattiganJessi L. Corcoran
/s/ BARBARA BRASIERDirectorFebruary 23, 2023
Barbara Brasier
/s/ C. MAURY DEVINEDirectorFebruary 28, 201823, 2023
C. Maury Devine
/s/ EDWARD L. DOHENY, IIDirectorFebruary 28, 2018
Edward L. Doheny, II
/s/ ALAN D. FELDMANDirectorFebruary 28, 201823, 2023
Alan D. Feldman
/s/ JAMES E. GOODWINDirectorFebruary 28, 2018
James E. Goodwin
/s/ POLLY B. KAWALEKDirectorFebruary 28, 201823, 2023
Polly B. Kawalek
/s/ JAMES M. RINGLEREMMANUEL LAGARRIGUEDirectorFebruary 28, 201823, 2023
James M. RinglerEmmanuel Lagarrigue
/s/ LAWRENCE V. JACKSONDirectorFebruary 23, 2023
Lawrence V. Jackson
/s/ CHARLES L. HARRINGTONDirectorFebruary 23, 2023
Charles L. Harrington

95103