Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2017 | Oct. 27, 2017 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ZBH | |
Entity Registrant Name | ZIMMER BIOMET HOLDINGS, INC. | |
Entity Central Index Key | 1,136,869 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 202,473,076 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Earnings (unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Income Statement [Abstract] | ||||
Net Sales | $ 1,818.1 | $ 1,832.8 | $ 5,749.8 | $ 5,670.8 |
Cost of products sold, excluding intangible asset amortization | 500.9 | 479.3 | 1,541.5 | 1,760 |
Intangible asset amortization | 152.7 | 164.3 | 452.4 | 424.7 |
Research and development | 91.2 | 95.6 | 272.4 | 269.9 |
Selling, general and administrative | 694.5 | 727.7 | 2,203.3 | 2,176.6 |
Special items (Note 2) | 165.4 | 170.4 | 434.1 | 397 |
Operating expenses | 1,604.7 | 1,637.3 | 4,903.7 | 5,028.2 |
Operating Profit | 213.4 | 195.5 | 846.1 | 642.6 |
Other expense, net | (4.5) | (1.1) | (11.2) | (8.7) |
Interest income | 0.6 | 0.6 | 1.4 | 2.7 |
Interest expense | (82.3) | (91.5) | (247.5) | (267.8) |
Earnings before income taxes | 127.2 | 103.5 | 588.8 | 368.8 |
Provision (benefit) for income taxes | 28.4 | (54.4) | 6.6 | 133.9 |
Net Earnings | 98.8 | 157.9 | 582.2 | 234.9 |
Less: Net loss attributable to noncontrolling interest | (0.9) | (0.2) | (1.4) | |
Net Earnings of Zimmer Biomet Holdings, Inc. | $ 98.8 | $ 158.8 | $ 582.4 | $ 236.3 |
Earnings Per Common Share | ||||
Basic | $ 0.49 | $ 0.79 | $ 2.89 | $ 1.18 |
Diluted | $ 0.48 | $ 0.78 | $ 2.86 | $ 1.17 |
Weighted Average Common Shares Outstanding | ||||
Basic | 202.3 | 200.1 | 201.7 | 199.9 |
Diluted | 204 | 202.9 | 203.6 | 202.3 |
Cash Dividends Declared Per Common Share | $ 0.24 | $ 0.24 | $ 0.72 | $ 0.72 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income (unaudited) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net Earnings | $ 98.8 | $ 157.9 | $ 582.2 | $ 234.9 |
Other Comprehensive Income: | ||||
Foreign currency cumulative translation adjustments, net of tax | 129.7 | 58.3 | 367.9 | 113.9 |
Unrealized cash flow hedge losses, net of tax | (28.3) | (9.7) | (79.4) | (53) |
Reclassification adjustments on hedges, net of tax | 4.1 | (13.9) | (9.4) | (58) |
Unrealized gains on securities, net of tax | 0.4 | |||
Adjustments to prior service cost and unrecognized actuarial assumptions, net of tax | (1) | 1.2 | (5) | 22.3 |
Total Other Comprehensive Income | 104.5 | 35.9 | 274.1 | 25.6 |
Comprehensive Income | 203.3 | 193.8 | 856.3 | 260.5 |
Comprehensive loss attributable to the noncontrolling interest | (0.2) | (0.2) | (0.6) | (0.8) |
Comprehensive Income (Loss) attributable to Zimmer Biomet Holdings, Inc. | $ 203.5 | $ 194 | $ 856.9 | $ 261.3 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (unaudited) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Current Assets: | ||
Cash and cash equivalents | $ 480.8 | $ 634.1 |
Accounts receivable, less allowance for doubtful accounts | 1,318.5 | 1,604.4 |
Inventories | 2,084.2 | 1,959.4 |
Prepaid taxes | 229.6 | 214.7 |
Other prepaid expenses and current assets | 320.2 | 251 |
Total Current Assets | 4,433.3 | 4,663.6 |
Property, plant and equipment, net | 2,048.6 | 2,037.9 |
Goodwill | 10,904.9 | 10,643.9 |
Intangible assets, net | 8,464.9 | 8,785.4 |
Other assets | 565.8 | 553.6 |
Total Assets | 26,417.5 | 26,684.4 |
Current Liabilities: | ||
Accounts payable | 327.1 | 364.5 |
Income taxes payable | 289.6 | 183.5 |
Current portion of long-term debt | 1,225 | 575.6 |
Other current liabilities | 1,168.5 | 1,257.9 |
Total Current Liabilities | 3,010.2 | 2,381.5 |
Deferred income taxes | 2,879.8 | 3,030.9 |
Other long-term liabilities | 877.6 | 936.3 |
Long-term debt | 9,199.7 | 10,665.8 |
Total Liabilities | 15,967.3 | 17,014.5 |
Commitments and Contingencies (Note 15) | ||
Stockholders' Equity: | ||
Common stock, $0.01 par value, one billion shares authorized, 306.3 million shares issued in 2017 (304.7 million in 2016) | 3 | 3.1 |
Paid-in capital | 8,493.9 | 8,368.5 |
Retained earnings | 8,837.2 | 8,467.1 |
Accumulated other comprehensive loss | (159.9) | (434) |
Treasury stock, 103.9 million shares in 2017 (104.1 million shares in 2016) | (6,724.4) | (6,735.8) |
Total Zimmer Biomet Holdings, Inc. stockholders' equity | 10,449.8 | 9,668.9 |
Noncontrolling interest | 0.4 | 1 |
Total Stockholders' Equity | 10,450.2 | 9,669.9 |
Total Liabilities and Stockholders' Equity | $ 26,417.5 | $ 26,684.4 |
Condensed Consolidated Balance5
Condensed Consolidated Balance Sheets (unaudited) (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued | 306,300,000 | 304,700,000 |
Treasury stock, shares | 103,900,000 | 104,100,000 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Cash flows provided by (used in) operating activities: | ||
Net earnings | $ 582.2 | $ 234.9 |
Adjustments to reconcile net earnings to cash provided by operating activities: | ||
Depreciation and amortization | 798.2 | 787.3 |
Share-based compensation | 40.1 | 45.9 |
Goodwill and intangible asset impairment | 59.5 | 28 |
Inventory step-up | 32.2 | 300.9 |
Changes in operating assets and liabilities, net of effect of acquisitions: | ||
Income taxes | (245.4) | (125.4) |
Receivables | 349.7 | (80.3) |
Inventories | (123.2) | 44.2 |
Accounts payable and accrued expenses | (173.6) | (76) |
Other assets and liabilities | (140.3) | (154.5) |
Net cash provided by operating activities | 1,179.4 | 1,005 |
Cash flows provided by (used in) investing activities: | ||
Additions to instruments | (255.7) | (251.3) |
Additions to other property, plant and equipment | (109.8) | (130.1) |
Purchases of investments | (1.4) | |
Sales of investments | 273.3 | |
Other business combination investments, net of acquired cash | (4) | (421.9) |
Other investing activities | (13.1) | 7.8 |
Net cash used in investing activities | (382.6) | (1,544.7) |
Cash flows provided by (used in) financing activities: | ||
Proceeds from multicurrency revolving facility | 400 | |
Payments on multicurrency revolving facility | (400) | |
Redemption of senior notes | (500) | |
Proceeds from term loan | 192.7 | 750 |
Payments on term loan | (640) | (700) |
Net payments on other debt | (0.9) | (33.1) |
Dividends paid to stockholders | (145) | (140.3) |
Proceeds from employee stock compensation plans | 132.6 | 113.5 |
Business combination contingent consideration payments | (9.1) | |
Restricted stock withholdings | (7.6) | (5.3) |
Debt issuance costs | (0.3) | (3.4) |
Repurchase of common stock | (415.5) | |
Net cash used in financing activities | (977.6) | (434.1) |
Effect of exchange rates on cash and cash equivalents | 27.5 | (10.2) |
Decrease in cash and cash equivalents | (153.3) | (984) |
Cash and cash equivalents, beginning of year | 634.1 | 1,459.3 |
Cash and cash equivalents, end of period | $ 480.8 | 475.3 |
LDR Holding Corporation [Member] | ||
Cash flows provided by (used in) investing activities: | ||
LDR acquisition, net of acquired cash | $ (1,021.1) |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2017 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | 1. Basis of Presentation The financial data presented herein is unaudited and should be read in conjunction with the consolidated financial statements and accompanying notes included in the 2016 Annual Report on Form 10-K filed by Zimmer Biomet Holdings, Inc. In our opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments necessary for a fair statement of the financial position, results of operations and cash flows for the interim periods presented. The December 31, 2016 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). Results for interim periods should not be considered indicative of results for the full year. The words “we,” “us,” “our” and similar words and “Zimmer Biomet” refer to Zimmer Biomet Holdings, Inc. and its subsidiaries. “Zimmer Biomet Holdings” refers to the parent company only. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies Special Items - We recognize expenses resulting directly from our business combinations, employee termination benefits, certain research and development (“R&D”) agreements, certain contract terminations, goodwill and intangible asset impairment, consulting and professional fees and asset impairment or loss on disposal charges connected with global restructuring, quality enhancement and remediation efforts, operational excellence initiatives, and other items as “Special items” in our condensed consolidated statement of earnings. “Special items” included (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Biomet merger-related Consulting and professional fees $ 19.9 $ 59.0 $ 60.7 $ 138.4 Employee termination benefits 5.4 7.1 12.0 14.3 Dedicated project personnel 10.2 21.9 33.1 64.8 Relocated facilities 1.8 9.5 6.1 17.5 Certain litigation matters 5.0 - 5.0 - Contract terminations - 3.5 - 28.8 Information technology integration 1.3 4.8 4.9 9.3 Goodwill and intangible asset impairment 32.7 - 59.5 28.0 Other 4.8 8.0 25.0 12.4 Total Biomet merger-related 81.1 113.8 206.3 313.5 Other Consulting and professional fees 56.3 14.6 158.4 30.3 Employee termination benefits (0.6 ) 3.2 2.0 3.2 Dedicated project personnel 14.0 8.2 35.5 11.5 Impairment/loss on disposal of assets - - - 1.1 LDR merger consideration compensation expense - 24.1 - 24.1 Relocated facilities 0.6 - 3.1 0.2 Certain litigation matters 3.0 3.7 10.0 3.7 Contract terminations - 0.1 - 1.1 Information technology integration 1.0 0.8 1.8 1.1 Certain R&D agreements - - 2.5 - Contingent consideration adjustments 1.7 - (1.5 ) - Other 8.3 1.9 16.0 7.2 Total Other 84.3 56.6 227.8 83.5 Special items $ 165.4 $ 170.4 $ 434.1 $ 397.0 Consulting and professional fees include expenditures related to third-party integration consulting performed in a variety of areas such as tax, compliance, logistics and human resources for our business combinations including our merger with Biomet, Inc. (“Biomet”); legal fees related to the consummation of mergers and acquisitions and certain litigation and compliance matters; other consulting and professional fees and contract labor related to our quality enhancement and remediation efforts and operational excellence initiatives; third-party fees related to severance and termination benefits matters; costs of complying with our deferred prosecution agreement; and consulting fees related to certain information system integrations. Dedicated project personnel expenses include the salary, benefits, travel expenses and other costs directly associated with employees who are 100 percent dedicated to our integration of acquired businesses, employees who have been notified of termination, but are continuing to work on transferring their responsibilities and employees working on our quality enhancement and remediation efforts and operational excellence initiatives. As part of the Biomet merger (defined below), we recognized $209.0 million of intangible assets for in-process research and development (“IPR&D”) projects. We recorded impairment losses related to IPR&D intangible assets of $18.8 million and $28.0 million during the nine month periods ended September 30, 2017 and 2016, respectively. The impairments were primarily due to the termination of certain IPR&D projects. We also recognized $479.0 million of intangible assets for trademarks that we designated as having an indefinite life. In the nine month period ended September 30, 2017, we reclassified one of these trademarks to a finite life asset which resulted in an impairment of $8.0 million. During the three and nine month periods ended September 30, 2017, we recognized a $32.7 million goodwill impairment charge on our Office Based Technologies reporting unit. See Note 9 for additional details. A further detailed description of expenses included in “Special items” can be found in Note 2 to our Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2016. On June 24, 2015, pursuant to an agreement and plan of merger dated April 24, 2014, we acquired LVB Acquisition, Inc. (“LVB”), the parent company of Biomet, and LVB and Biomet became our wholly-owned subsidiaries (sometimes hereinafter referred to as the “Biomet merger” or the “merger”). After the closing date of the Biomet merger, we started to implement our integration plans to drive operational synergies. Part of these integration plans included termination of employees and certain contracts with independent agents, distributors, suppliers and lessors. Our integration plans are expected to last through mid-2018 and we expect to incur a total of $170 million for employee termination benefits and $140 million for contract termination expense in that time period. As of September 30, 2017, we have incurred a cumulative total of $163.8 million for employee termination benefits and $134.9 million for contract termination expense. The following table summarizes the liabilities related to these integration plans (in millions): Employee Termination Contract Benefits Terminations Total Balance at December 31, 2016 $ 38.1 $ 35.1 $ 73.2 Additions 12.0 - 12.0 Cash payments (33.1 ) (9.4 ) (42.5 ) Foreign currency exchange rate changes 1.2 0.4 1.6 Balance at September 30, 2017 $ 18.2 $ 26.1 $ 44.3 Recent Accounting Pronouncements – In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04 – Simplifying the Test for Goodwill Impairment. This ASU requires goodwill impairment to be measured as the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. Under previous guidance, if the carrying amount of a reporting unit’s net assets were greater than its fair value, impairment was measured as the excess of the carrying amount of the reporting unit’s goodwill over its implied fair value. The determination of a reporting unit’s implied goodwill generally required significant estimates to fair value its net assets. Therefore, this ASU simplifies goodwill impairment testing by eliminating the need to estimate the fair value of a reporting unit’s net assets. The impact of this ASU is dependent on the specific facts and circumstances of future impairments and is applied prospectively on testing that occurs subsequent to adoption. We elected to early adopt this ASU in the third quarter of 2017. As a result, the new ASU was used to determine the goodwill impairment charge on our Office Based Technologies reporting unit that was recognized in the third quarter of 2017. See Note 9 for additional details regarding this goodwill impairment charge. In October 2016, the FASB issued ASU 2016-16 – Intra-Entity Asset Transfers of Assets Other than Inventory. This ASU changes the accounting for the tax effects of intra-entity asset transfers/sales. Under current GAAP, the tax effects of intra-entity asset transfers/sales are deferred until the transferred asset is sold to a third party or otherwise recovered through use. Under the new guidance, the tax expense from the sale of the asset in the seller’s tax jurisdiction is recognized when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The new guidance does not apply to intra-entity transfers/sales of inventory. We early adopted this standard effective January 1, 2017. The modified retrospective approach is required for transition, which resulted in us recognizing a cumulative-effect adjustment in Retained earnings as of January 1, 2017 for intra-entity transfers/sales we had executed prior to that date. The January 1, 2017 cumulative effect adjustment resulted in a $72.7 million decrease to Retained earnings, a $3.9 million decrease to Other prepaid expenses and current assets, a $22.4 million decrease in Other assets, a $2.0 million decrease to Income taxes payable, and a $48.4 million increase to Deferred income taxes. The adoption of this ASU resulted in additional tax expense of $1.5 million and a tax benefit of $2.2 million to our provision for income taxes in the three and nine month periods ended September 30, 2017, respectively, compared to what it would have been under the previous accounting rules. In May 2014, the FASB issued ASU 2014-09 – Revenue from Contracts with Customers. This ASU provides a five-step model for revenue recognition that all industries will apply to recognize revenue when a customer obtains control of a good or service. This ASU will be effective for us beginning January 1, 2018. Entities are permitted to apply the standard and related amendments either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the ASU recognized at the date of initial application. During the fourth quarter of 2016, we commenced an initial evaluation of the new standard and a related assessment and review of a representative sample of existing revenue contracts with our customers on some of our most significant revenue streams. In 2017, we have expanded our scope to perform an analysis at locations with less significant revenue streams and have provided training on the new standard to finance personnel across all of our locations. Our assessment of our revenue streams is substantially complete. Based upon our assessment, we do not believe there will be a material change to the timing of our revenue recognition. However, we will be required to reclassify certain immaterial costs from selling, general and administrative (“SG&A”) expense to net sales, which will result in a reduction of net sales, but have no impact on operating profit. In the fourth quarter of 2017, we will focus on additional disclosures we may need to make and the effect of this ASU on our internal control over financial reporting or other changes in business practices and processes. We plan to adopt this new standard using the retrospective method, which will result in us restating prior reporting periods presented. As noted previously, we expect this will result in us reclassifying certain immaterial costs from SG&A expense to net sales in each of those prior reporting periods. Our evaluation of ASU 2014-09 is ongoing and not complete. In February 2016, the FASB issued ASU 2016-02 – Leases. This ASU requires lessees to recognize right-of-use assets and lease liabilities on the balance sheet. This ASU will be effective for us beginning January 1, 2019. Early adoption is permitted. The ASU must be adopted using a modified retrospective transition approach at the beginning of the earliest comparative period in the consolidated financial statements. We own most of our manufacturing facilities, but lease various office space throughout the world. We are formalizing our project team and in the fourth quarter of 2017 will begin evaluating our leases and the related impact this ASU will have on our consolidated financial statements. In March 2017, the FASB issued ASU 2017-07 – Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This ASU requires us to report the service cost component of pensions in the same location as other compensation costs arising from services rendered by the pertinent employees during the period. We will be required to report the other components of net benefit costs in Other Income (Expense) in the statement of earnings. This ASU will be effective for us beginning January 1, 2018. The ASU must be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost in the statement of earnings and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension cost in assets. See Note 12 for further information on the components of our net benefit cost. In August 2017, the FASB issued ASU 2017-12 – Targeted Improvements to Accounting for Hedging Activities. This ASU amends the hedge accounting guidance to simplify the application of hedge accounting, makes more financial and nonfinancial hedging strategies eligible for hedge accounting treatment, changes how companies assess effectiveness and updates presentation and disclosure requirements. We are currently evaluating the impact this ASU will have on our consolidated financial statements; however, based on our current hedging portfolio, we do not anticipate that this ASU will have a significant impact on our financial position, results of operations or cash flows. This ASU will be effective for us January 1, 2019, with early adoption permitted. After adoption, we may explore new hedging opportunities that are eligible for hedge accounting treatment under the new standard. There are no other recently issued accounting pronouncements that we have not yet adopted that are expected to have a material effect on our financial position, results of operations or cash flows. |
Business Combinations
Business Combinations | 9 Months Ended |
Sep. 30, 2017 | |
Business Combinations [Abstract] | |
Business Combinations | 3. Business Combinations LDR Acquisition On July 13, 2016, we completed our acquisition of LDR Holding Corporation (“LDR”). We paid cash of $1,138.0 million. The total amount of merger consideration utilized for the acquisition method of accounting, as reduced by the merger consideration paid to holders of unvested LDR stock options and LDR stock-based awards of $24.1 million, was $1,113.9 million. The addition of LDR provided us with an immediate position in the growing cervical disc replacement (“CDR”) market. The combination positioned us to accelerate the growth of our Spine business through the incremental revenues associated with entry into the CDR market and cross-portfolio selling opportunities to both Zimmer Biomet and LDR customer bases. The goodwill was generated from the operational synergies and cross-selling opportunities we expected to achieve from our combined operations. None of the goodwill is deductible for tax purposes. The following table summarizes the final estimated fair value of the assets acquired and liabilities assumed in the LDR acquisition (in millions): Final Values Cash $ 92.8 Accounts receivable, net 30.5 Inventory 97.0 Other current assets 5.6 Property, plant and equipment 24.7 Intangible assets not subject to amortization: In-process research and development (IPR&D) 2.0 Intangible assets subject to amortization: Technology 447.0 Customer relationships 122.0 Trademarks and trade names 74.0 Other assets 73.8 Goodwill 507.2 Total assets acquired 1,476.6 Current liabilities 122.5 Long-term debt 0.5 Deferred taxes 236.7 Other long-term liabilities 3.0 Total liabilities assumed 362.7 Net assets acquired $ 1,113.9 We have not included pro forma information and certain other information under GAAP for the LDR acquisition because it did not have a material impact on our financial position or results of operations. Other acquisitions During the year ended December 31, 2016, we completed individually immaterial acquisitions of companies including Cayenne Medical, Inc. (“Cayenne Medical”), a sports medicine company, Compression Therapy Concepts, Inc. (“CTC”), a provider of non-invasive products for the prevention of deep vein thrombosis, CD Diagnostics, Inc. (“CD Diagnostics”), a medical diagnostic testing company, and MedTech SA (“MedTech”), a designer and manufacturer of robotic equipment for brain and spine surgeries. The total aggregate cash consideration was $441.7 million. These acquisitions were completed primarily to expand our product offerings. We have assigned a fair value of $58.0 million for settlement of preexisting relationships and additional payments related to these acquisitions that are contingent on the respective acquired companies’ product sales, commercial milestones and certain cost savings. The fair value of the aggregate contingent payment liabilities was calculated based on the probability of achieving the specified sales growth, cost savings and commercial milestones and discounting to present value the payments. The goodwill was generated from the operational synergies and cross-selling opportunities we expected to achieve from the technologies acquired. None of the goodwill related to these acquisitions is deductible for tax purposes. The following table summarizes the aggregate final estimated fair value of the assets acquired and liabilities assumed related to the Cayenne Medical, CTC, CD Diagnostics, MedTech, and other immaterial acquisitions that occurred during the year ended December 31, 2016 (in millions): Current assets $ 66.4 Property, plant and equipment 4.5 Intangible assets 172.9 Goodwill 337.1 Other assets 38.2 Total assets acquired 619.1 Current liabilities 20.0 Long-term liabilities 99.4 Total liabilities assumed 119.4 Net assets acquired $ 499.7 We have not included pro forma information and certain other information under GAAP for the Cayenne Medical, CTC, CD Diagnostics, or MedTech acquisitions because, individually and in aggregate, they did not have a material impact on our financial position or results of operations. Goodwill The following table summarizes the changes in the carrying amount of our goodwill (in millions): Americas EMEA Asia Pacific Product Category Operating Segments Total Balance at December 31, 2016 Goodwill $ 7,634.5 $ 1,263.7 $ 487.3 $ 1,631.4 $ 11,016.9 Accumulated impairment loss - - - (373.0 ) (373.0 ) 7,634.5 1,263.7 487.3 1,258.4 10,643.9 LDR purchase accounting - - - 24.8 24.8 Other acquisitions 13.2 (24.1 ) - 27.6 16.7 Currency translation 82.5 110.0 10.0 49.7 252.2 Impairment - - - (32.7 ) (32.7 ) Balance at September 30, 2017 Goodwill 7,730.2 1,349.6 497.3 1,733.5 11,310.6 Accumulated impairment loss - - - (405.7 ) (405.7 ) $ 7,730.2 $ 1,349.6 $ 497.3 $ 1,327.8 $ 10,904.9 |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | 4. September 30, December 31, 2017 2016 (in millions) Finished goods $ 1,674.2 $ 1,556.9 Work in progress 189.6 141.7 Raw materials 220.4 260.8 Inventories $ 2,084.2 $ 1,959.4 Finished goods inventory as of September 30, 2017 and December 31, 2016 included $0.7 million and $35.3 million, respectively, to step-up acquired inventory to fair value. |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2017 | |
Property Plant And Equipment [Abstract] | |
Property, Plant and Equipment | 5. Property, Plant and Equipment September 30, December 31, 2017 2016 (in millions) Land $ 29.4 $ 37.0 Buildings and equipment 1,833.5 1,789.9 Capitalized software costs 406.8 397.2 Instruments 2,634.4 2,347.6 Construction in progress 111.3 99.8 5,015.4 4,671.5 Accumulated depreciation (2,966.8 ) (2,633.6 ) Property, plant and equipment, net $ 2,048.6 $ 2,037.9 |
Transfers of Financial Assets
Transfers of Financial Assets | 9 Months Ended |
Sep. 30, 2017 | |
Transfers And Servicing [Abstract] | |
Transfers of Financial Assets | 6. Transfers of Financial Assets In the fourth quarter of 2016, we executed receivables purchase arrangements to liquidate portions of our trade accounts receivable balance with unrelated third parties. The receivables relate to products sold to customers and are short-term in nature. The factorings were treated as sales of our accounts receivable. Proceeds from the transfers reflect either the face value of the accounts receivable or the face value less factoring fees. In the U.S. and Japan, our programs are executed on a revolving basis with a maximum funding limit as of September 30, 2017 of $315 million. We act as the collection agent on behalf of the third party, but have no significant retained interests or servicing liabilities related to the accounts receivable sold. In order to mitigate credit risk, we purchased credit insurance for the factored accounts receivable. The result is our risk of loss being limited to the factored accounts receivable not covered by the insurance. Additionally, we have provided guarantees for the factored accounts receivable. The maximum exposures to loss associated with these arrangements were $24.4 million and $5.2 million as of September 30, 2017 and December 31, 2016, respectively. In Europe, we sell to a third party and have no continuing involvement or significant risk with the factored accounts receivable. Funds received from the transfers are recorded as an increase to cash and a reduction to accounts receivable outstanding in the condensed consolidated balance sheets. We report the cash flows attributable to the sale of receivables to third parties in cash flows from operating activities in our condensed consolidated statements of cash flows. Net expenses resulting from the sales of receivables are recognized in selling, general and administrative expense. Net expenses include any resulting gains or losses from the sales of receivables, credit insurance and factoring fees. In the nine month period ended September 30, 2017, we sold receivables having an aggregate face value of $1,050.5 million to third parties in exchange for cash proceeds of $1,049.8 million. Expenses recognized on these sales during the three and nine month periods ended September 30, 2017, were not significant. In the nine month period ended September 30, 2017, under the U.S. and Japan programs, we collected $682.2 At September 30, 2017, the outstanding principal amount of receivables that has been derecognized under the U.S. and Japan revolving arrangements amounted to $210.6 million and $65.5 million, respectively. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Debt | 7. Debt Our debt consisted of the following (in millions): September 30, December 31, 2017 2016 Current portion of long-term debt 1.450% Senior Notes due 2017 $ - $ 500.0 2.000% Senior Notes due 2018 1,150.0 - U.S. Term Loan B 75.0 75.0 Other short-term debt - 0.6 Total current portion of long-term debt $ 1,225.0 $ 575.6 Long-term debt 2.000% Senior Notes due 2018 $ - $ 1,150.0 4.625% Senior Notes due 2019 500.0 500.0 2.700% Senior Notes due 2020 1,500.0 1,500.0 3.375% Senior Notes due 2021 300.0 300.0 3.150% Senior Notes due 2022 750.0 750.0 3.550% Senior Notes due 2025 2,000.0 2,000.0 4.250% Senior Notes due 2035 253.4 253.4 5.750% Senior Notes due 2039 317.8 317.8 4.450% Senior Notes due 2045 395.4 395.4 1.414% Euro Notes due 2022 591.1 527.4 2.425% Euro Notes due 2026 591.1 527.4 U.S. Term Loan A 1,135.0 1,700.0 U.S. Term Loan B 600.0 675.0 Japan Term Loan A 103.9 99.6 Japan Term Loan B 189.1 - Other long-term debt 4.1 4.2 Debt discount and issuance costs (56.3 ) (65.8 ) Adjustment related to interest rate swaps 25.1 31.4 Total long-term debt $ 9,199.7 $ 10,665.8 At September 30, 2017, our total debt balance consisted of On September 22, 2017, we entered into a term loan agreement for the Japan Term Loan B, and an amended and restated term loan agreement, which amended and restated the Japan Term Loan A loan agreement dated as of May 24, 2012, as amended as of October 31, 2014. As described above, the term loans under both of these agreements will mature on September 27, 2022. Each of these term loans bears interest at a fixed rate of 0.635% per annum. We have a revolving credit and term loan agreement (the “2016 Credit Agreement”) and a first amendment to our credit agreement executed in 2014 (the “2014 Credit Agreement”). The 2016 Credit Agreement contains the U.S. Term Loan B and a five-year unsecured multicurrency revolving facility of $1.5 billion (the “Multicurrency Revolving Facility”). The Multicurrency Revolving Facility replaced the previous multicurrency revolving facility under the 2014 Credit Agreement and will mature on September 30, 2021, with two available one-year extensions at our discretion. The 2014 Credit Agreement also provided for the U.S. Term Loan A, which remains in effect. Borrowings under the 2014 and 2016 Credit Agreements generally bear interest at floating rates. We pay a facility fee on the aggregate amount of the Multicurrency Revolving Facility. If our credit rating falls below investment grade, additional restrictions would result, including restrictions on investments and payment of dividends. We were in compliance with all financial covenants under the 2014 and 2016 Credit Agreements as of September 30, 2017. As of September 30, 2017, there were no borrowings outstanding under the Multicurrency Revolving Facility. Under the terms of U.S. Term Loan A, starting September 30, 2015, principal payments are due as follows: $75.0 million on a quarterly basis during the first three years, $112.5 million on a quarterly basis during the fourth year, and $412.5 million on a quarterly basis during the fifth year. We have paid $1.86 billion in principal under U.S. Term Loan A, resulting in $1.14 billion in outstanding borrowings as of September 30, 2017. Under the terms of U.S. Term Loan B, future principal payments are due as follows: $75.0 million on September 30, 2018, with the remaining balance due on the maturity date of September 30, 2019. We have paid $75.0 million in principal under U.S. Term Loan B, resulting in $675.0 million outstanding on the U.S. Term Loan B as of September 30, 2017. The estimated fair value of our senior notes as of September 30, 2017, based on quoted prices for the specific securities from transactions in over-the-counter markets (Level 2), was $8,520.9 million. The estimated fair value of Japan Term Loan A and Japan Term Loan B, in the aggregate, as of September 30, 2017, based upon publicly available market yield curves and the terms of the debt (Level 2), was $291.8 million. The carrying values of U.S. Term Loan A and U.S. Term Loan B approximate their fair values as they bear interest at short-term variable market rates. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income | 8. Accumulated Other Comprehensive Income Accumulated other comprehensive income (“AOCI”) refers to certain gains and losses that under GAAP are included in comprehensive income but are excluded from net earnings as these amounts are initially recorded as an adjustment to stockholders’ equity. Amounts in AOCI may be reclassified to net earnings upon the occurrence of certain events. Our AOCI is comprised of foreign currency translation adjustments, unrealized gains and losses on cash flow hedges, unrealized gains and losses on available-for-sale securities, and amortization of prior service costs and unrecognized gains and losses in actuarial assumptions on our defined benefit plans. Foreign currency translation adjustments are reclassified to net earnings upon sale or upon a complete or substantially complete liquidation of an investment in a foreign entity. Unrealized gains and losses on cash flow hedges are reclassified to net earnings when the hedged item affects net earnings. Unrealized gains and losses on available-for-sale securities are reclassified to net earnings if we sell the security before maturity or if the unrealized loss is considered to be other-than-temporary. Amounts related to defined benefit plans that are in AOCI are reclassified over the service periods of employees in the plan. The reclassification amounts are allocated to all employees in the plans and, therefore, the reclassified amounts may become part of inventory to the extent they are considered direct labor costs. See Note 12 for more information on our defined benefit plans. The following table shows the changes in the components of AOCI, net of tax (in millions): Foreign Cash Unrealized Defined Currency Flow (Losses) Gains on Benefit Translation Hedges Securities Plan Items Balance at December 31, 2016 $ (323.4 ) $ 32.3 $ (0.1 ) $ (142.8 ) AOCI before reclassifications 367.9 (79.4 ) - (10.1 ) Reclassifications - (9.4 ) - 5.1 Balance at September 30, 2017 $ 44.5 $ (56.5 ) $ (0.1 ) $ (147.8 ) The following table shows the reclassification adjustments from AOCI (in millions): Amount of Gain (Loss) Reclassified from AOCI Three Months Ended Nine Months Ended September 30, September 30, Location on Component of AOCI 2017 2016 2017 2016 Statement of Earnings Cash flow hedges Foreign exchange forward contracts $ (5.1 ) $ 18.1 $ 12.0 $ 76.5 Cost of products sold Forward starting interest rate swaps (0.1 ) (0.4 ) (0.4 ) (1.3 ) Interest expense (5.2 ) 17.7 11.6 75.2 Total before tax (1.1 ) 3.8 2.2 17.2 Provision for income taxes $ (4.1 ) $ 13.9 $ 9.4 $ 58.0 Net of tax Defined benefit plans Prior service cost $ 2.6 $ 1.9 $ 7.7 $ 5.8 * Unrecognized actuarial (loss) (5.4 ) (5.1 ) (16.2 ) (15.1 ) * (2.8 ) (3.2 ) (8.5 ) (9.3 ) Total before tax (1.1 ) (1.0 ) (3.4 ) (3.3 ) Benefit for income taxes $ (1.7 ) $ (2.2 ) $ (5.1 ) $ (6.0 ) Net of tax Total reclassifications $ (5.8 ) $ 11.7 $ 4.3 $ 52.0 Net of tax * These AOCI components are included in the computation of net periodic pension expense (see Note 12). The following table shows the tax effects on each component of AOCI recognized in our condensed consolidated statements of comprehensive income (in millions): Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Before Tax Tax Net of Tax Before Tax Tax Net of Tax Foreign currency cumulative translation adjustments $ 145.0 $ 15.3 $ 129.7 $ 414.6 $ 46.7 $ 367.9 Unrealized cash flow hedge (losses) (35.9 ) (7.6 ) (28.3 ) (99.0 ) (19.6 ) (79.4 ) Reclassification adjustments on cash flow hedges 5.2 1.1 4.1 (11.6 ) (2.2 ) (9.4 ) Adjustments to prior service cost and unrecognized actuarial assumptions 0.5 1.5 (1.0 ) (2.9 ) 2.1 (5.0 ) Total Other Comprehensive Income $ 114.8 $ 10.3 $ 104.5 $ 301.1 $ 27.0 $ 274.1 Three Months Ended September 30, 2016 Nine Months Ended September 30, 2016 Before Tax Tax Net of Tax Before Tax Tax Net of Tax Foreign currency cumulative translation adjustments $ 58.3 $ - $ 58.3 $ 113.9 $ - $ 113.9 Unrealized cash flow hedge (losses) gains (16.1 ) (6.4 ) (9.7 ) (80.9 ) (27.9 ) (53.0 ) Reclassification adjustments on cash flow hedges (17.7 ) (3.8 ) (13.9 ) (75.2 ) (17.2 ) (58.0 ) Unrealized gains on securities - - - 0.4 - 0.4 Adjustments to prior service cost and unrecognized actuarial assumptions 2.2 1.0 1.2 25.6 3.3 22.3 Total Other Comprehensive Loss $ 26.7 $ (9.2 ) $ 35.9 $ (16.2 ) $ (41.8 ) $ 25.6 |
Fair Value Measurement of Asset
Fair Value Measurement of Assets and Liabilities | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement of Assets and Liabilities | 9 . The following assets and liabilities are recorded at fair value on a recurring basis (in millions): As of September 30, 2017 Fair Value Measurements at Reporting Date Using: Description Recorded Balance Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets Derivatives, current and long-term Foreign currency forward contracts $ 3.9 $ - $ 3.9 $ - Interest rate swaps 3.8 - 3.8 - Total Assets $ 7.7 $ - $ 7.7 $ - Liabilities Derivatives, current and long-term Foreign currency forward contracts $ 39.5 $ - $ 39.5 $ - Contingent payments related to acquisitions 44.0 - - 44.0 Total Liabilities $ 83.5 $ - $ 39.5 $ 44.0 As of December 31, 2016 Fair Value Measurements at Reporting Date Using: Description Recorded Balance Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets Derivatives, current and long-term Foreign currency forward contracts $ 65.3 $ - $ 65.3 $ - Interest rate swaps 4.0 - 4.0 - Total Assets $ 69.3 $ - $ 69.3 $ - Liabilities Derivatives, current and long-term Foreign currency forward contracts $ 0.3 $ - $ 0.3 $ - Contingent payments related to acquisitions 62.8 - - 62.8 Total Liabilities $ 63.1 $ - $ 0.3 $ 62.8 We value our foreign currency forward contracts and foreign currency options using a market approach based on foreign currency exchange rates obtained from active markets, and we perform ongoing assessments of counterparty credit risk. We value our interest rate swaps using a market approach based on publicly available market yield curves and the terms of our swaps, and we perform ongoing assessments of counterparty credit risk. Contingent payments related to acquisitions consist of commercial milestone, cost savings and sales-based payments, and are valued using discounted cash flow techniques. The fair value of commercial milestone payments reflects management’s expectations of probability of payment, and increases as the probability of payment increases or expectation of timing of payments is accelerated. The fair value of cost savings and sales-based payments is based upon probability-weighted future cost savings and revenue estimates, and increases as cost savings and revenue estimates increase, probability weighting of higher cost savings and revenue scenarios increase or expectation of timing of payment is accelerated. In the three and nine month periods ended September 30, 2017, we recognized $1.7 million of loss and $1.5 million of income, respectively, related to contingent payments due to changes in estimates. In the nine month period ended September 30, 2017, we also paid $13.7 million in contingent payments and made a fair value adjustment of $3.6 million to the preliminary estimate of contingent consideration that reduced the contingent payment liability. In the third quarter of 2017, we performed a goodwill impairment test on our Office Based Technologies reporting unit due to continued revenue declines. As a result, we recognized a $32.7 million impairment charge. The $32.7 million impairment represented the entire goodwill balance of the reporting unit and therefore no goodwill remains. This reporting unit was acquired as part of the Biomet merger in 2015 and therefore its assets and liabilities were recognized at their estimated fair values at the merger date. Since the merger date valuation, operating performance has been lower than expected due to integration issues, management turnover and poor execution of its operating plans. We estimated the fair value of the Office Based Technologies reporting unit using a market approach. GAAP defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” We used market indicators based upon the reporting unit’s operating performance to estimate what price would be paid for the assets in an orderly transaction. We have six other reporting units with goodwill assigned to them. We did not perform goodwill impairment tests on our other reporting units as there were no indicators that their goodwill may be impaired. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | 10. Derivative Instruments and Hedging Activities We are exposed to certain market risks relating to our ongoing business operations, including foreign currency exchange rate risk, commodity price risk, interest rate risk and credit risk. We manage our exposure to these and other market risks through regular operating and financing activities. Currently, the only risks that we manage through the use of derivative instruments are interest rate risk and foreign currency exchange rate risk. Interest Rate Risk Derivatives Designated as Fair Value Hedges In prior years, we entered into various fixed-to-variable interest rate swap agreements that were accounted for as fair value hedges of a portion of our 4.625% Senior Notes due 2019 and all of our 3.375% Senior Notes due 2021. In August 2016, we received cash for these interest rate swap assets by terminating the hedging instruments with the counterparties. The remaining unamortized balance as of September 30, 2017 was $25.1 million, which will be recognized using the effective interest rate method over the remaining maturity period of the hedged notes. Derivatives Designated as Cash Flow Hedges In 2014, we entered into forward starting interest rate swaps that were designated as cash flow hedges of our thirty-year tranche of senior notes (the 4.450% Senior Notes due 2045) we expected to issue in 2015. The forward starting interest rate swaps mitigated the risk of changes in interest rates prior to the completion of the offering of senior notes in connection with the Biomet merger. The interest rate swaps were settled, and the remaining loss to be recognized at September 30, 2017 was $27.8 million, which will be recognized using the effective interest rate method over the remaining maturity period of the hedged notes. In September 2016, we entered into various variable-to-fixed interest rate swap agreements with a notional amount of $375 million that were accounted for as cash flow hedges of U.S. Term Loan B. The interest rate swaps minimize the exposure to changes in the LIBOR interest rates while the variable-rate debt is outstanding. The weighted average fixed interest rate for all of the swaps executed is approximately 0.82 percent through September 30, 2019. Foreign Currency Exchange Rate Risk We operate on a global basis and are exposed to the risk that our financial condition, results of operations and cash flows could be adversely affected by changes in foreign currency exchange rates. To reduce the potential effects of foreign currency exchange rate movements on net earnings, we enter into derivative financial instruments in the form of foreign currency exchange forward contracts with major financial institutions. We also designated our Euro Notes as net investment hedges of investments in foreign subsidiaries. We are primarily exposed to foreign currency exchange rate risk with respect to transactions and net assets denominated in Euros, Swiss Francs, Japanese Yen, British Pounds, Canadian Dollars, Australian Dollars, Korean Won, Swedish Krona, Czech Koruna, Thai Baht, Taiwan Dollars, South African Rand, Russian Rubles, Indian Rupees, Turkish Lira, Polish Zloty, Danish Krone, and Norwegian Krone. We do not use derivative financial instruments for trading or speculative purposes. Derivatives Designated as Net Investment Hedges We are exposed to the impact of foreign exchange rate fluctuations in the investments in our wholly-owned foreign subsidiaries that are denominated in currencies other than the U.S. Dollar. In order to mitigate the volatility in foreign exchange rates, we issued Euro Notes in December 2016 and designated 100 percent of the Euro Notes to hedge our net investment in certain wholly-owned foreign subsidiaries that have a functional currency of Euro. All changes in the fair value of the hedging instrument designated as a net investment hedge are recorded as a component of accumulated other comprehensive loss in the condensed consolidated balance sheet. In the three and nine month periods ended September 30, 2017, we recognized foreign exchange losses of $41.7 million and $127.5 million, respectively, in AOCI in foreign currency translation adjustments on our net investment hedges. We recognized no ineffectiveness from our net investment hedges for the three and nine month periods ended September 30, 2017. Derivatives Designated as Cash Flow Hedges Our revenues are generated in various currencies throughout the world. However, a significant amount of our inventory is produced in U.S. Dollars. Therefore, movements in foreign currency exchange rates may have different proportional effects on our revenues compared to our cost of products sold. To minimize the effects of foreign currency exchange rate movements on cash flows, we hedge intercompany sales of inventory expected to occur within the next 30 months with foreign currency exchange forward contracts. We designate these derivative instruments as cash flow hedges. We perform quarterly assessments of hedge effectiveness by verifying and documenting the critical terms of the hedge instrument and confirming that forecasted transactions have not changed significantly. We also assess on a quarterly basis whether there have been adverse developments regarding the risk of a counterparty default. For derivatives which qualify as hedges of future cash flows, the effective portion of changes in fair value is temporarily recorded in other comprehensive income and then recognized in cost of products sold when the hedged item affects net earnings. The ineffective portion of a derivative’s change in fair value, if any, is immediately reported in cost of products sold. On our condensed consolidated statement of cash flows, the settlements of these cash flow hedges are recognized in operating cash flows. For foreign currency exchange forward contracts and options outstanding at September 30, 2017, we had obligations to purchase U.S. Dollars and sell Euros, Japanese Yen, British Pounds, Canadian Dollars, Australian Dollars, Korean Won, Swedish Krona, Czech Koruna, Thai Baht, Taiwan Dollars, South African Rand, Russian Rubles, Indian Rupees, Turkish Lira, Polish Zloty, Danish Krone, and Norwegian Krone and obligations to purchase Swiss Francs and sell U.S. Dollars. These derivatives mature at dates ranging from October 2017 through March 2020. As of September 30, 2017, the notional amounts of outstanding forward contracts and options entered into with third parties to purchase U.S. Dollars were $1,683.9 million. As of September 30, 2017, the notional amounts of outstanding forward contracts and options entered into with third parties to purchase Swiss Francs were $285.0 million. Derivatives Not Designated as Hedging Instruments We enter into foreign currency forward exchange contracts with terms of one month to manage currency exposures for monetary assets and liabilities denominated in a currency other than an entity’s functional currency. As a result, any foreign currency re-measurement gains/losses recognized in earnings are generally offset with gains/losses on the foreign currency forward exchange contracts in the same reporting period. The net amount of these offsetting gains/losses is recorded in Other expense. These contracts are settled on the last day of each reporting period. Therefore, there is no outstanding balance related to these contracts recorded on the balance sheet as of the end of the reporting period. The notional amounts of these contracts are typically in a range of $1.5 billion to $2.0 billion per quarter. Income Statement Presentation Derivatives Designated as Fair Value Hedges Derivative instruments designated as fair value hedges had the following effects on our condensed consolidated statements of earnings (in millions): Gain (Loss) on Gain (Loss) on Instrument Hedged Item Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended Location on September 30, September 30, September 30, September 30, Derivative Instrument Statement of Earnings 2017 2016 2017 2016 2017 2016 2017 2016 Interest rate swaps Interest expense $ - $ (3.8 ) $ - $ 10.1 $ - $ 3.8 $ - $ (10.1 ) Derivatives Designated as Cash Flow Hedges Derivative instruments designated as cash flow hedges had the following effects, before taxes, on AOCI and Net earnings on our condensed consolidated statements of earnings, condensed consolidated statements of comprehensive income and condensed consolidated balance sheets (in millions): Amount of Gain (Loss) Amount of Gain (Loss) Recognized in AOCI Reclassified from AOCI Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, Location on September 30, September 30, Derivative Instrument 2017 2016 2017 2016 Statement of Earnings 2017 2016 2017 2016 Foreign exchange forward contracts $ (35.6 ) $ (16.1 ) $ (98.7 ) $ (80.9 ) Cost of products sold $ (5.1 ) $ 18.1 $ 12.0 $ 76.5 Interest rate swaps (0.3 ) - (0.3 ) - Interest expense - - - - Forward starting interest rate swaps - - - - Interest expense (0.1 ) (0.4 ) (0.4 ) (1.3 ) $ (35.9 ) $ (16.1 ) $ (99.0 ) $ (80.9 ) $ (5.2 ) $ 17.7 $ 11.6 $ 75.2 The net amounts recognized in earnings during the three and nine month periods ended September 30, 2017 and 2016 due to ineffectiveness and amounts excluded from the assessment of hedge effectiveness were not significant. The fair value of outstanding derivative instruments designated as cash flow hedges and recorded on the balance sheet at September 30, 2017, together with settled derivatives where the hedged item has not yet affected earnings, was a net unrealized loss of $74.3 million, or $56.6 million after taxes, which is deferred in AOCI. A loss of $29.3 million, or $24.1 million after taxes, is expected to be reclassified to earnings in cost of products sold and a loss of $0.6 million, or $0.4 million after taxes, is expected to be reclassified to earnings in interest expense over the next twelve months. Derivatives Not Designated as Hedging Instruments The following losses from these derivative instruments were recognized on our condensed consolidated statements of earnings (in millions): Three Months Ended Nine Months Ended Location on September 30, September 30, Derivative Instrument Statement of Earnings 2017 2016 2017 2016 Foreign exchange forward contracts Other expense, net $ (16.3 ) $ (5.1 ) $ (54.9 ) $ (42.3 ) These losses do not reflect offsetting gains of $11.1 million and $1.3 million in the three month periods ended September 30, 2017 and 2016, respectively, and offsetting gains of $43.0 million and $33.6 million in the nine month periods ended September 30, 2017 and 2016, respectively, recognized in Other expense, net as a result of foreign currency re-measurement of monetary assets and liabilities denominated in a currency other than an entity’s functional currency. Balance Sheet Presentation As of September 30, 2017 and December 31, 2016, all derivative instruments designated as fair value hedges and cash flow hedges were recorded at fair value on the balance sheet. On our condensed consolidated balance sheets, we recognize individual forward contracts and options with the same counterparty on a net asset/liability basis if we have a master netting agreement with the counterparty. Under these master netting agreements, we are able to settle derivative instrument assets and liabilities with the same counterparty in a single transaction, instead of settling each derivative instrument separately. We have master netting agreements with all of our counterparties. The fair value of derivative instruments on a gross basis is as follows (in millions): As of September 30, 2017 As of December 31, 2016 Balance Balance Sheet Fair Sheet Fair Location Value Location Value Asset Derivatives Foreign exchange forward contracts Other current assets $ 15.9 Other current assets $ 57.9 Foreign exchange forward contracts Other assets 7.4 Other assets 34.9 Interest rate swaps Other assets 3.8 Other assets 4.0 Total asset derivatives $ 27.1 $ 96.8 Liability Derivatives Foreign exchange forward contracts Other current liabilities $ 37.2 Other current liabilities $ 20.9 Foreign exchange forward contracts Other long-term liabilities 21.7 Other long-term liabilities 6.9 Total liability derivatives $ 58.9 $ 27.8 The table below presents the effects of our master netting agreements on our condensed consolidated balance sheets (in millions): As of September 30, 2017 As of December 31, 2016 Description Location Gross Amount Offset Net Amount in Balance Sheet Gross Amount Offset Net Amount in Balance Sheet Asset Derivatives Cash flow hedges Other current assets $ 15.9 $ 13.6 $ 2.3 $ 57.9 $ 20.6 $ 37.3 Cash flow hedges Other assets 7.4 5.8 1.6 34.9 6.8 28.1 Liability Derivatives Cash flow hedges Other current liabilities 37.2 13.6 23.6 20.9 20.6 0.3 Cash flow hedges Other long-term liabilities 21.7 5.8 15.9 6.9 6.8 0.1 The following net investment hedge losses were recognized on our condensed consolidated statements of comprehensive income (in millions): Amount of Loss Recognized in OCI Three Months Ended Nine Months Ended September 30, September 30, Derivative Instrument 2017 2016 2017 2016 Euro Notes $ (41.7 ) $ - $ (127.5 ) $ - |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. Income Taxes We operate on a global basis and are subject to numerous and complex tax laws and regulations. Additionally, tax laws continue to undergo rapid changes in both application and interpretation by various countries, including state aid interpretations and the Organization for Economic Cooperation and Development led initiatives. Our income tax filings are subject to examinations by taxing authorities throughout the world. Income tax audits may require an extended period of time to reach resolution and may result in significant income tax adjustments when interpretation of tax laws or allocation of company profits is disputed. Although ultimate timing is uncertain, the net amount of tax liability for unrecognized tax benefits may change within the next twelve months due to changes in audit status, expiration of statutes of limitations, settlements of tax assessments and other events. Management’s best estimate of such change is within the range of a $115 million decrease to a $25 million increase. Our U.S. Federal income tax returns have been audited through 2009 and are currently under audit for years 2010-2015. The IRS has proposed adjustments for years 2005-2012, reallocating profits between certain of our U.S. and foreign subsidiaries. We have disputed these adjustments and intend to continue to vigorously defend our positions. For years 2005-2007, we have filed a petition with the U.S. Tax Court. For years 2008-2009, we are pursuing resolution through the IRS Administrative Appeals Process. Our effective tax rate (“ETR”) has been affected by the significant expenses associated with the Biomet merger and other acquisitions which have generally been recognized in higher income tax jurisdictions. Accordingly, this has reduced our ETR as our earnings have been lower in these higher income tax jurisdictions. In the nine month period ended September 30, 2017, we recognized a tax benefit of $69.7 million resulting from a tax restructuring that lowered the tax rate on certain deferred tax liabilities recorded on intangible assets recognized in the Biomet merger acquisition-related accounting. In the three and nine month periods ended September 30, 2017, we recognized tax benefits of $39.8 million and $128.6 million, respectively, related to resolution of certain tax matters. In the three and nine month periods ended September 30, 2017, we recognized net income tax expense of $7.7 million and $11.8 million, respectively, that related to previous periods for resolution of certain tax matters, certain tax restructurings and product liability matters. We have evaluated the effect of these out-of-period corrections on the three and nine month periods ended September 30, 2017, as well as on the previous interim and annual periods in which they should have been recognized, and concluded for both quantitative and qualitative reasons that these adjustments are not material to any of the periods affected. Further, we do not believe these adjustments will be material to our estimated net earnings for the full year ended December 31, 2017. |
Retirement Benefit Plans
Retirement Benefit Plans | 9 Months Ended |
Sep. 30, 2017 | |
Compensation And Retirement Disclosure [Abstract] | |
Retirement Benefit Plans | 12. Retirement Benefit Plans We have defined benefit pension plans covering certain U.S. and Puerto Rico employees. The employees who are not participating in the defined benefit plans receive additional benefits under our defined contribution plans. Plan benefits are primarily based on years of credited service and the participant’s compensation. In addition to the U.S. and Puerto Rico defined benefit pension plans, we sponsor various foreign pension arrangements, including retirement and termination benefit plans required by local law or coordinated with government sponsored plans. The components of net periodic pension expense for our U.S. and foreign defined benefit pension plans are as follows (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 7.1 $ 7.6 $ 21.0 $ 22.8 Interest cost 4.6 4.7 13.9 19.3 Expected return on plan assets (10.1 ) (10.2 ) (30.3 ) (35.6 ) Curtailment gain (loss) 0.2 (0.4 ) 0.4 (1.0 ) Amortization of prior service cost (2.6 ) (1.9 ) (7.7 ) (5.8 ) Amortization of unrecognized actuarial loss 5.4 5.1 16.2 15.1 Net periodic pension expense $ 4.6 $ 4.9 $ 13.5 $ 14.8 We expect that we will have minimal legally required funding obligations in 2017 for our U.S. and Puerto Rico defined benefit pension plans, and therefore we have not made, nor do we voluntarily expect to make, any material contributions to these plans during 2017. We contributed $13.2 million to our foreign-based defined benefit pension plans in the nine month period ended September 30, 2017, and we expect to contribute $4.7 million to these foreign-based plans during the remainder of 2017. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | 13. Earnings Per Share The following is a reconciliation of weighted average shares for the basic and diluted shares computations (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Weighted average shares outstanding for basic net earnings per share 202.3 200.1 201.7 199.9 Effect of dilutive stock options and other equity awards 1.7 2.8 1.9 2.4 Weighted average shares outstanding for diluted net earnings per share 204.0 202.9 203.6 202.3 During the three and nine month periods ended September 30, 2017, an average of 0.9 million options and 0.8 million options, respectively, to purchase shares of common stock were not included in the computation of diluted earnings per share because the exercise prices of these options were greater than the average market price of our common stock. In the three and nine month periods ended September 30, 2016, an average of 0.1 million options and 0.5 million options, respectively, were not included for the same reason. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | 14. Segment Information We design, manufacture and market orthopaedic reconstructive products; sports medicine, biologics, extremities and trauma products; spine, craniomaxillofacial and thoracic products (“CMF”); office based technologies; dental implants; and related surgical products. We allocate resources to achieve our operating profit goals through seven operating segments. Our operating segments are comprised of both geographic and product category business units. The geographic operating segments are the Americas, which is comprised principally of the U.S. and includes other North, Central and South American markets; EMEA, which is comprised principally of Europe and includes the Middle East and African markets; and Asia Pacific, which is comprised primarily of Japan and includes other Asian and Pacific markets. The product category operating segments are Spine less Asia Pacific, Office Based Technologies, CMF and Dental. The geographic operating segments include results from all of our product categories except those in the product category operating segments. The Office Based Technologies, CMF and Dental product category operating segments reflect those respective product category results from all regions, whereas the Spine less Asia Pacific product category operating segment includes all spine product results excluding those from Asia Pacific. As it relates to the geographic operating segments, management evaluates performance based upon segment operating profit exclusive of operating expenses pertaining to inventory step-up and certain other inventory and manufacturing related charges, “Certain claims,” goodwill impairment, intangible asset amortization, “Special items,” and global operations and corporate functions. Global operations and corporate functions include research, development engineering, medical education, brand management, corporate legal, finance and human resource functions, manufacturing operations and logistics and share-based payment expense. As it relates to each product category operating segment, research, development engineering, medical education, brand management and other various costs that are specific to the product category operating segment’s operations are reflected in its operating profit results. Due to these additional costs included in the product category operating segments, profitability metrics among the geographic operating segments and product category operating segments are not comparable. Intercompany transactions have been eliminated from segment operating profit. Management does not review asset information by operating segment. Instead, management reviews cash flow and other financial ratios by operating segment. These seven operating segments are the basis for our reportable segment information provided below. The four product category operating segments are individually insignificant to our consolidated results and therefore do not constitute a reportable segment either individually or combined. For presentation purposes, these product category operating segments have been aggregated. In 2017, due to a change in management responsibilities, the sales and operating profit results of our Spine business in EMEA were combined with the previous Americas Spine operating segment to form the product category operating segment, Spine less Asia Pacific. Prior period reportable segment financial information has been restated to conform to the current presentation. Net sales and operating profit by segment are as follows (in millions): Net Sales Operating Profit Three Months Ended Three Months Ended September 30, September 30, 2017 2016 2017 2016 Americas $ 921.2 $ 946.6 $ 502.3 $ 515.6 EMEA 335.4 322.1 97.5 92.3 Asia Pacific 281.7 274.5 101.5 106.3 Product Category Operating Segments 279.8 289.6 51.1 47.5 Global Operations and Corporate Functions - - (210.5 ) (208.7 ) Total $ 1,818.1 $ 1,832.8 Inventory step-up and other inventory and manufacturing related charges (10.4 ) (22.8 ) Intangible asset amortization (152.7 ) (164.3 ) Special items (165.4 ) (170.4 ) Operating profit $ 213.4 $ 195.5 Net Sales Operating Profit Nine Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Americas $ 2,900.0 $ 2,909.6 $ 1,568.8 $ 1,574.1 EMEA 1,108.5 1,122.7 348.2 368.0 Asia Pacific 850.5 806.9 318.5 331.4 Product Category Operating Segments 890.8 831.6 197.2 177.1 Global Operations and Corporate Functions - - (641.6 ) (628.6 ) Total $ 5,749.8 $ 5,670.8 Inventory step-up and other inventory and manufacturing related charges (58.5 ) (357.7 ) Intangible asset amortization (452.4 ) (424.7 ) Special items (434.1 ) (397.0 ) Operating profit $ 846.1 $ 642.6 Net sales by product category are as follows (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Knees $ 623.7 $ 631.5 $ 2,005.9 $ 2,031.7 Hips 434.5 440.6 1,380.0 1,385.7 S.E.T. 406.6 401.8 1,254.5 1,215.0 Dental 92.9 95.9 311.1 322.5 Spine & CMF 184.9 183.7 565.2 470.7 Other 75.5 79.3 233.1 245.2 Total $ 1,818.1 $ 1,832.8 $ 5,749.8 $ 5,670.8 “S.E.T” refers to our Surgical, Sports Medicine, Foot and Ankle, Extremities and Trauma product category. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 15. Commitments and Contingencies On a quarterly and annual basis, we review relevant information with respect to loss contingencies and update our accruals, disclosures and estimates of reasonably possible losses or ranges of loss based on such reviews. We establish liabilities for loss contingencies when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. For matters where a loss is believed to be reasonably possible, but not probable, no accrual has been made. Litigation Durom ® : On July 22, 2008, we temporarily suspended marketing and distribution of the Durom Cup in the U.S. Subsequently, a number of product liability lawsuits were filed against us in various U.S. and foreign jurisdictions. The plaintiffs seek damages for personal injury, and they generally allege that the Durom Cup contains defects that result in complications and premature revision of the device. We have settled some of these claims and others are still pending. The majority of the pending U.S. lawsuits are currently in a federal Multidistrict Litigation (“MDL”) in the District of New Jersey ( ). Multi-plaintiff state court cases are pending in St. Clair County, Illinois ( ) and Los Angeles County, California ( ). The initial trial in took place in November 2014, the initial trial in the MDL took place in May 2015 and the initial trial in took place in July 2015. As of September 30, 2017, litigation activity in the MDL, and is stayed to allow participation in the U.S. Durom Cup Settlement Program, an extrajudicial program created to resolve actions and claims of eligible U.S. plaintiffs and claimants. Other lawsuits are pending in various domestic and foreign jurisdictions, and additional claims may be asserted in the future. The majority of claims outside the U.S. are pending in Canada, Germany, Netherlands, Italy and the U.K. A Canadian class settlement was approved in late 2016. Trials have commenced in Germany, and the majority of claims in the U.K. are consolidated in a Group Litigation Order. Since 2008, we have recognized expense of $479.4 million for Durom Cup-related claims. Our estimate of our total liability for these claims as of September 30, 2017 remains consistent with our estimate as of December 31, 2016, and, accordingly, we did not record any additional expense during the nine month period ended September 30, 2017. With respect to the same prior year period, we also did not record any expense for Durom Cup-related claims. We maintain insurance for product liability claims, subject to self-insurance retention requirements. As of September 30, 2017, we have exhausted our self-insured retention under our insurance program and have a claim for insurance proceeds for ultimate losses which exceed the self-insured retention amount, subject to a 20 percent co-payment requirement and a cap. We believe our contracts with the insurance carriers are enforceable for these claims and, therefore, it is probable that we will recover some amount from our insurance carriers. We have received a portion of the insurance proceeds we estimate we will recover. We have a $95.3 million receivable in “Other assets” remaining on our condensed consolidated balance sheet as of September 30, 2017 for estimated insurance recoveries for Durom Cup-related claims. As is customary in this process, our insurance carriers have reserved all rights under their respective policies and could still ultimately deny coverage for some or all of our insurance claims. Our estimate as of September 30, 2017 of the remaining liability for all Durom Cup-related claims is $218.3 million, of which $75.0 million is classified as short-term in “Other current liabilities” and $143.3 million is classified as long-term in “Other long-term liabilities” on our condensed consolidated balance sheet. We expect to pay the majority of the Durom Cup-related claims within the next few years. Our understanding of clinical outcomes with the Durom Cup and other large diameter hip cups continues to evolve. We rely on significant estimates in determining the provisions for Durom Cup-related claims, including our estimate of the number of claims that we will receive and the average amount we will pay per claim. The actual number of claims and the actual amount we pay per claim may differ from our estimates. Among other factors, since our understanding of the clinical outcomes is still evolving, we cannot reasonably estimate the possible loss or range of loss that may result from Durom Cup-related claims in excess of the losses we have accrued. Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain. Margo and Daniel Polett v. Zimmer, Inc. et al. : On August 20, 2008, Margo and Daniel Polett filed an action against us and an unrelated third party, Public Communications, Inc. (“PCI”), in the Court of Common Pleas, Philadelphia, Pennsylvania seeking an unspecified amount of damages for injuries and loss of consortium allegedly suffered by Mrs. Polett and her spouse, respectively. The complaint alleged that defendants were negligent in connection with Mrs. Polett’s participation in a promotional video featuring one of our knee products. The case was tried in November 2010 and the jury returned a verdict in favor of plaintiffs. The jury awarded $27.6 million in compensatory damages and apportioned fault 30 percent to plaintiffs, 34 percent to us and 36 percent to PCI. Under applicable law, we may be liable for any portion of the damages apportioned to PCI that it does not pay. On December 2, 2010, we and PCI filed a motion for post-trial relief seeking a judgment notwithstanding the verdict, a new trial or a remittitur. On June 10, 2011, the trial court entered an order denying our motion for post-trial relief and affirming the jury verdict in full and entered judgment for $20.3 million against us and PCI. On June 29, 2011, we filed a notice of appeal to the Superior Court of Pennsylvania and posted a bond for the verdict amount plus interest. Oral argument before the appellate court in Philadelphia, Pennsylvania was held on March 13, 2012. On March 1, 2013, the Superior Court of Pennsylvania vacated the $27.6 million judgment and remanded the case for a new trial. On March 15, 2013, plaintiffs filed a motion for re-argument , and on March 28, 2013, we filed our response in opposition. On May 9, 2013, the Superior Court of Pennsylvania granted plaintiffs’ motion for re-argument . Oral argument (re-argument ) before the Superior Court of Pennsylvania was held on October 16, 2013. On December 20, 2013, the Court issued its opinion again vacating the trial court judgment and remanding the case for a new trial. On January 21, 2014, plaintiffs filed a petition for allowance of appeal in the Supreme Court of Pennsylvania, which was granted on May 21, 2014. Oral argument before the Supreme Court of Pennsylvania took place on October 8, 2014. On October 27, 2015, the Supreme Court of Pennsylvania reversed the order of the Superior Court of Pennsylvania and remanded the case to that court to consider the question of whether the trial court erred in refusing to remit the jury’s compensatory damages award. On June 6, 2016, an en banc panel of the Superior Court of Pennsylvania vacated the $27.6 million verdict and remanded the case back to the trial court for remittitur. On December 2, 2016, the trial court remitted the verdict to $21.5 million. On December 5, 2016, we filed a notice of appeal to the Superior Court of Pennsylvania. Oral argument before the Superior Court of Pennsylvania took place on September 20, 2017. The Court has not yet issued its opinion. Although we are defending this lawsuit vigorously, its ultimate resolution is uncertain. In the future, we could be required to record a charge that could have a material adverse effect on our results of operations and cash flows. NexGen ® Following a wide-spread advertising campaign conducted by certain law firms beginning in 2010, a number of product liability lawsuits have been filed against us in various jurisdictions. The plaintiffs seek damages for personal injury, alleging that certain products within the NexGen Knee System, specifically the NexGen Flex Femoral Components and MIS Stemmed Tibial Component, suffer from defects that cause them to loosen prematurely. The majority of the cases are currently pending in a federal MDL in the Northern District of Illinois ( ). Other cases are pending in various state courts, and additional lawsuits may be filed. Thus far, all cases decided by the MDL court or a jury on the merits have involved NexGen Flex Femoral Components, which represent the majority of cases in the MDL. The initial bellwether trial took place in October 2015 and resulted in a defense verdict. The next scheduled bellwether trial, which was set to commence in November 2016, was dismissed following the court’s grant of summary judgment in our favor in October 2016. The second bellwether trial took place in January 2017 and resulted in a defense verdict. Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain. Biomet metal-on-metal hip implant claims : Biomet is a defendant in a number of product liability lawsuits relating to metal-on-metal hip implants. The majority of these cases involve the M2a-Magnum TM . Other cases are pending in various state and foreign courts. On February 3, 2014, Biomet announced the settlement of the MDL. Lawsuits filed in the MDL by April 15, 2014 were eligible to participate in the settlement. Those claims that did not settle via the MDL settlement program have re-commenced litigation in the MDL under a new case management plan. The settlement does not affect certain other claims relating to Biomet’s metal-on-metal hip products that are pending in various state and foreign courts, or other claims that may be filed in the future. Our estimate as of September 30, 2017 of the remaining liability for all Biomet metal-on-metal hip implant claims is $39.7 million. Biomet has exhausted the self-insured retention in its insurance program and has been reimbursed for claims related to its metal-on-metal products up to its policy limits in the program. Zimmer Biomet is responsible for any amounts by which the ultimate losses exceed the amount of Biomet’s third-party insurance coverage. As of September 30, 2017, Biomet had received all of the insurance proceeds it expects to recover under the excess policies. Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain. Heraeus trade secret misappropriation lawsuits: In December 2008, Heraeus Kulzer GmbH (together with its affiliates, “Heraeus”) initiated legal proceedings in Germany against Biomet, Inc., Biomet Europe BV, certain other entities and certain employees alleging that the defendants misappropriated Heraeus trade secrets when developing Biomet Europe’s Refobacin and Biomet Bone Cement line of cements (“European Cements”). The lawsuit sought to preclude the defendants from producing, marketing and offering for sale their current line of European Cements and to compensate Heraeus for any damages incurred. On June 5, 2014, the German appeals court in Frankfurt (i) enjoined Biomet, Inc., Biomet Europe BV and Biomet Deutschland GmbH from manufacturing, selling or offering the European Cements to the extent they contain certain raw materials in particular specifications; (ii) held the defendants jointly and severally liable to Heraeus for any damages from the sale of European Cements since 2005; and (iii) ruled that no further review may be sought (the “Frankfurt Decision”). The Heraeus and Biomet parties both sought appeal against the Frankfurt Decision. In a decision dated June 16, 2016, the German Supreme Court dismissed the parties’ appeals without reaching the merits, rendering that decision final. In December 2016, Heraeus filed papers to restart proceedings against Biomet Orthopaedics Switzerland GmbH, seeking to require that entity to relinquish its CE certificates for the European Cements. In January 2017, Heraeus notified Biomet it had filed a claim for damages in the amount of €121.9 million for sales in Germany. In September 2017, Heraeus filed an enforcement action in the Frankfurt court against Biomet Europe, requesting that a fine be imposed against Biomet Europe for failure to prevent Biomet Orthopaedics Switzerland from having bone cements for the Chinese market manufactured in Germany. Also in September 2017, Heraeus filed suit against Zimmer Biomet Deutschland in the court of first instance in Freiberg concerning the sale of the European Cements with certain changed raw materials. Heraeus seeks an injunction on the basis that the continued use of the product names for the European Cements is misleading for customers and thus an act of unfair competition. As of September 30, 2017, these claims were still pending. On September 8, 2014, Heraeus filed a complaint against a Biomet supplier, Esschem, Inc. (“Esschem”), in the United States District Court for the Eastern District of Pennsylvania. The lawsuit contains allegations that focus on two copolymer compounds that Esschem sells to Biomet, which Biomet incorporates into certain bone cement products that compete with Heraeus’ bone cement products. The complaint alleges that Biomet helped Esschem to develop these copolymers, using Heraeus trade secrets that Biomet allegedly misappropriated. The complaint asserts a claim under the Pennsylvania Trade Secrets Act, as well as other various common law tort claims, all based upon the same trade secret misappropriation theory. Heraeus is seeking to enjoin Esschem from supplying the copolymers to any third party and actual damages. The complaint also seeks punitive damages, costs and attorneys’ fees. If Esschem is enjoined, Biomet may not be able to obtain the copolymers from another supplier and as a result may not be able to continue to manufacture the subject bone cement products. Although Biomet is not a party to this lawsuit, Biomet has agreed, at Esschem’s request and subject to certain limitations, to indemnify Esschem for any liability, damages and legal costs related to this matter. On November 3, 2014, the court entered an order denying Heraeus’ motion for a temporary restraining order. On June 30, 2016, the court entered an order denying Heraeus’ request to give preclusive effect to the factual findings in the Frankfurt Decision. On June 6, 2017, the court entered an order denying Heraeus’ motion to add Biomet as a party to the lawsuit. The court has not set a trial date. Heraeus continues to pursue other related legal proceedings in Europe seeking various forms of relief, including injunctive relief and damages, against Biomet-related entities relating to the European Cements. We have accrued an estimated loss relating to the Frankfurt Decision, but have not recognized any losses for Heraeus-related lawsuits in other jurisdictions because we do not believe it is probable that we have incurred a liability, and we cannot reasonably estimate any loss that might eventually be incurred. Damages relating to the Frankfurt Decision are subject to separate proceedings and it is reasonably possible that our estimate of the loss we may incur may change in the future. Although we are vigorously defending these lawsuits, their ultimate resolution is uncertain. Stryker patent infringement lawsuit : On December 10, 2010, Stryker Corporation and related entities (“Stryker”) filed suit against us in the U.S. District Court for the Western District of Michigan, alleging that certain of our Pulsavac ® en banc . On March 23, 2015, the Federal Circuit denied Stryker’s petition. Stryker subsequently filed a petition for certiorari to the U.S. Supreme Court. In July 2015, we paid the final award of $90.3 million, which includes the original $70.0 million plus pre- and post-judgment interest and damages for sales that occurred post-trial but prior to our entry into a license agreement with Stryker. On October 19, 2015, the U.S. Supreme Court granted Stryker’s petition for certiorari. Oral argument took place on February 23, 2016. On June 13, 2016, the U.S. Supreme Court issued its decision, vacating the judgment of the Federal Circuit and remanding the case for further proceedings related to the willfulness issue. On September 12, 2016, the Federal Circuit issued an opinion affirming the jury’s willfulness finding and vacating and remanding the trial court’s award of treble damages, its finding that this was an exceptional case and its award of attorneys’ fees. The case was remanded back to the trial court. Oral argument on Stryker’s renewed consolidated motion for enhanced damages and attorneys’ fees took place on June 28, 2017. On July 12, 2017, the trial court issued an order reaffirming its award of treble damages, its finding that this was an exceptional case and its award of attorney’s fees. On July 24, 2017, we appealed the ruling to the Federal Circuit and obtained a supersedeas bond staying enforcement of the judgment pending appeal. Although we are defending this lawsuit vigorously, the ultimate resolution of this matter is uncertain. In the future, we could be required to record a charge of up to $165.0 million that could have a material adverse effect on our results of operations and cash flows. Putative Class Action: On December 2, 2016, a complaint was filed in the U.S. District Court for the Northern District of Indiana ( Shah v. Zimmer Biomet Holdings, Inc. et al.) , naming us, two of our officers and one of our now former officers as defendants. On June 28, 2017, the plaintiffs filed a corrected amended complaint, naming as defendants, in addition to those previously named, current and former members of our Board of Directors, one additional officer, and the underwriters in connection with secondary offerings of our common stock by certain selling stockholders in 2016. On October 6, 2017, the plaintiffs voluntarily dismissed the underwriters without prejudice. On October 8, 2017, the plaintiffs filed a second amended complaint, naming as defendants, in addition to those current and former officers and Board members previously named, certain former stockholders of ours who sold shares of our common stock in secondary public offerings in 2016. The second amended complaint relates to a putative class action on behalf of persons who purchased our common stock between June 7, 2016 and November 7, 2016. The second amended complaint alleges that the defendants violated federal securities laws by making materially false and/or misleading statements and/or omissions about our compliance with U.S. Food and Drug Administration (“FDA”) regulations and our ability to continue to accelerate our organic revenue growth rate in the second half of 2016. The plaintiffs seek unspecified damages and interest, attorneys’ fees, costs and other relief. We believe this lawsuit is without merit, and we and the individual defendants are defending it vigorously. Regulatory Matters, Government Investigations and Other Matters FDA warning letters : In September 2012, Zimmer received a warning letter from the FDA citing concerns relating to certain processes pertaining to products manufactured at our Ponce, Puerto Rico manufacturing facility. In May 2016, Zimmer received a warning letter from the FDA related to observed non-conformities with current good manufacturing practice requirements of the FDA’s Quality System Regulation (21 CFR Part 820) (“QSR”) at our facility in Montreal, Quebec, Canada. We have provided detailed responses to the FDA as to our corrective actions and will continue to work expeditiously to address the issues identified by the FDA during inspections in Ponce and Montreal. As of September 30, 2017, these warning letters remained pending. Until the violations cited in the pending warning letters are corrected, we may be subject to additional regulatory action by the FDA, as described more fully below. Additionally, requests for Certificates to Foreign Governments related to products manufactured at certain of our facilities may not be granted and premarket approval applications for Class III devices to which the QSR deviations at these facilities are reasonably related will not be approved until the violations have been corrected. In addition to responding to the warning letters described above, we are in the process of addressing various FDA Form 483 inspectional observations at certain of our manufacturing facilities, including at both the legacy Zimmer and the legacy Biomet manufacturing facilities in Warsaw, Indiana. The ultimate outcome of these matters is presently uncertain. Among other available regulatory actions, the FDA may impose operating restrictions, including a ceasing of operations, at one or more facilities, enjoining and restraining certain violations of applicable law pertaining to medical devices and assessing civil or criminal penalties against our officers, employees or us. The FDA could also issue a corporate warning letter, a recidivist warning letter or a consent decree of permanent injunction. The FDA may also recommend prosecution by the U.S. Department of Justice (“DOJ”). Any adverse regulatory action, depending on its magnitude, may restrict us from effectively manufacturing, marketing and selling our products and could have a material adverse effect on our business, financial condition and results of operations. Deferred Prosecution Agreement (“DPA”) relating to U.S. Foreign Corrupt Practices Act (“FCPA”) matters: On January 12, 2017, we resolved previously-disclosed FCPA matters involving Biomet and certain of its subsidiaries. As part of the settlement, Biomet resolved matters with the U.S. Securities and Exchange Commission (“SEC”) through an administrative cease-and-desist order (the “Order”); (ii) we entered into a DPA with the DOJ; and (iii) JERDS Luxembourg Holding S.à r.l. (“JERDS”), the direct parent company of Biomet 3i Mexico SA de CV and an indirect, wholly-owned subsidiary of Biomet, entered into a plea agreement (the “Plea Agreement”) with the DOJ. The conduct underlying these resolutions occurred prior to our acquisition of Biomet. Pursuant to the terms of the Order, Biomet resolved claims with the SEC related to violations of the books and records, internal controls and anti-bribery provisions of the FCPA by disgorging profits to the U.S. government in an aggregate amount of approximately $6.5 million, inclusive of pre-judgment interest, and paying a civil penalty in the amount of $6.5 million (collectively, the “Civil Settlement Payments”). We also agreed to pay a criminal penalty of approximately $17.5 million (together with the Civil Settlement Payments, the “Settlement Payments”) to the U.S. government pursuant to the terms of the DPA. We made the Settlement Payments in January 2017 and, as previously disclosed, had accrued, as of June 24, 2015, the closing date of the Biomet merger, an amount sufficient to cover this matter. Under the DPA, which has a term of three years, the DOJ agreed to defer criminal prosecution of us in connection with the charged violation of the internal controls provision of the FCPA as long as we comply with the terms of the DPA. In addition, we will be subject to oversight by an independent compliance monitor for at least 12 months. The monitor, who was appointed effective as of July 2017, will focus on legacy Biomet operations as integrated into our operations. If we remain in compliance with the DPA during its term, the charges against us will be dismissed with prejudice. The term of the DPA may be extended for up to one additional year at the DOJ’s discretion. In addition, under its Plea Agreement with the DOJ, JERDS pleaded guilty on January 13, 2017 to aiding and abetting a violation of the books and records provision of the FCPA. In light of the DPA we entered into, JERDS paid only a nominal assessment and no criminal penalty. If we do not comply with the terms of the DPA, we could be subject to prosecution for violating the internal controls provisions of the FCPA and the conduct of Biomet and its subsidiaries described in the DPA, which conduct pre-dated our acquisition of Biomet, as well as any new or continuing violations. We could also be subject to exclusion by the Office of Inspector General of the Department of Health and Human Services (“OIG”) OIG subpoena : In June 2017, we received a subpoena from the OIG. The subpoena requests that we produce a variety of records primarily related to our healthcare professional consulting arrangements (including in the areas of medical education, product development, and clinical research) for the period spanning January 1, 2010 to the present. The subpoena does not indicate the nature of the OIG’s investigation beyond reference to possible false or otherwise improper claims submitted for payment. We are in the process of responding to the subpoena. We cannot currently predict the outcome of this investigation . |
Significant Accounting Polici22
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Special Items | Special Items - We recognize expenses resulting directly from our business combinations, employee termination benefits, certain research and development (“R&D”) agreements, certain contract terminations, goodwill and intangible asset impairment, consulting and professional fees and asset impairment or loss on disposal charges connected with global restructuring, quality enhancement and remediation efforts, operational excellence initiatives, and other items as “Special items” in our condensed consolidated statement of earnings. “Special items” included (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Biomet merger-related Consulting and professional fees $ 19.9 $ 59.0 $ 60.7 $ 138.4 Employee termination benefits 5.4 7.1 12.0 14.3 Dedicated project personnel 10.2 21.9 33.1 64.8 Relocated facilities 1.8 9.5 6.1 17.5 Certain litigation matters 5.0 - 5.0 - Contract terminations - 3.5 - 28.8 Information technology integration 1.3 4.8 4.9 9.3 Goodwill and intangible asset impairment 32.7 - 59.5 28.0 Other 4.8 8.0 25.0 12.4 Total Biomet merger-related 81.1 113.8 206.3 313.5 Other Consulting and professional fees 56.3 14.6 158.4 30.3 Employee termination benefits (0.6 ) 3.2 2.0 3.2 Dedicated project personnel 14.0 8.2 35.5 11.5 Impairment/loss on disposal of assets - - - 1.1 LDR merger consideration compensation expense - 24.1 - 24.1 Relocated facilities 0.6 - 3.1 0.2 Certain litigation matters 3.0 3.7 10.0 3.7 Contract terminations - 0.1 - 1.1 Information technology integration 1.0 0.8 1.8 1.1 Certain R&D agreements - - 2.5 - Contingent consideration adjustments 1.7 - (1.5 ) - Other 8.3 1.9 16.0 7.2 Total Other 84.3 56.6 227.8 83.5 Special items $ 165.4 $ 170.4 $ 434.1 $ 397.0 Consulting and professional fees include expenditures related to third-party integration consulting performed in a variety of areas such as tax, compliance, logistics and human resources for our business combinations including our merger with Biomet, Inc. (“Biomet”); legal fees related to the consummation of mergers and acquisitions and certain litigation and compliance matters; other consulting and professional fees and contract labor related to our quality enhancement and remediation efforts and operational excellence initiatives; third-party fees related to severance and termination benefits matters; costs of complying with our deferred prosecution agreement; and consulting fees related to certain information system integrations. Dedicated project personnel expenses include the salary, benefits, travel expenses and other costs directly associated with employees who are 100 percent dedicated to our integration of acquired businesses, employees who have been notified of termination, but are continuing to work on transferring their responsibilities and employees working on our quality enhancement and remediation efforts and operational excellence initiatives. As part of the Biomet merger (defined below), we recognized $209.0 million of intangible assets for in-process research and development (“IPR&D”) projects. We recorded impairment losses related to IPR&D intangible assets of $18.8 million and $28.0 million during the nine month periods ended September 30, 2017 and 2016, respectively. The impairments were primarily due to the termination of certain IPR&D projects. We also recognized $479.0 million of intangible assets for trademarks that we designated as having an indefinite life. In the nine month period ended September 30, 2017, we reclassified one of these trademarks to a finite life asset which resulted in an impairment of $8.0 million. During the three and nine month periods ended September 30, 2017, we recognized a $32.7 million goodwill impairment charge on our Office Based Technologies reporting unit. See Note 9 for additional details. A further detailed description of expenses included in “Special items” can be found in Note 2 to our Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2016. On June 24, 2015, pursuant to an agreement and plan of merger dated April 24, 2014, we acquired LVB Acquisition, Inc. (“LVB”), the parent company of Biomet, and LVB and Biomet became our wholly-owned subsidiaries (sometimes hereinafter referred to as the “Biomet merger” or the “merger”). After the closing date of the Biomet merger, we started to implement our integration plans to drive operational synergies. Part of these integration plans included termination of employees and certain contracts with independent agents, distributors, suppliers and lessors. Our integration plans are expected to last through mid-2018 and we expect to incur a total of $170 million for employee termination benefits and $140 million for contract termination expense in that time period. As of September 30, 2017, we have incurred a cumulative total of $163.8 million for employee termination benefits and $134.9 million for contract termination expense. The following table summarizes the liabilities related to these integration plans (in millions): Employee Termination Contract Benefits Terminations Total Balance at December 31, 2016 $ 38.1 $ 35.1 $ 73.2 Additions 12.0 - 12.0 Cash payments (33.1 ) (9.4 ) (42.5 ) Foreign currency exchange rate changes 1.2 0.4 1.6 Balance at September 30, 2017 $ 18.2 $ 26.1 $ 44.3 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements – In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04 – Simplifying the Test for Goodwill Impairment. This ASU requires goodwill impairment to be measured as the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. Under previous guidance, if the carrying amount of a reporting unit’s net assets were greater than its fair value, impairment was measured as the excess of the carrying amount of the reporting unit’s goodwill over its implied fair value. The determination of a reporting unit’s implied goodwill generally required significant estimates to fair value its net assets. Therefore, this ASU simplifies goodwill impairment testing by eliminating the need to estimate the fair value of a reporting unit’s net assets. The impact of this ASU is dependent on the specific facts and circumstances of future impairments and is applied prospectively on testing that occurs subsequent to adoption. We elected to early adopt this ASU in the third quarter of 2017. As a result, the new ASU was used to determine the goodwill impairment charge on our Office Based Technologies reporting unit that was recognized in the third quarter of 2017. See Note 9 for additional details regarding this goodwill impairment charge. In October 2016, the FASB issued ASU 2016-16 – Intra-Entity Asset Transfers of Assets Other than Inventory. This ASU changes the accounting for the tax effects of intra-entity asset transfers/sales. Under current GAAP, the tax effects of intra-entity asset transfers/sales are deferred until the transferred asset is sold to a third party or otherwise recovered through use. Under the new guidance, the tax expense from the sale of the asset in the seller’s tax jurisdiction is recognized when the transfer occurs, even though the pre-tax effects of that transaction are eliminated in consolidation. Any deferred tax asset that arises in the buyer’s jurisdiction would also be recognized at the time of the transfer. The new guidance does not apply to intra-entity transfers/sales of inventory. We early adopted this standard effective January 1, 2017. The modified retrospective approach is required for transition, which resulted in us recognizing a cumulative-effect adjustment in Retained earnings as of January 1, 2017 for intra-entity transfers/sales we had executed prior to that date. The January 1, 2017 cumulative effect adjustment resulted in a $72.7 million decrease to Retained earnings, a $3.9 million decrease to Other prepaid expenses and current assets, a $22.4 million decrease in Other assets, a $2.0 million decrease to Income taxes payable, and a $48.4 million increase to Deferred income taxes. The adoption of this ASU resulted in additional tax expense of $1.5 million and a tax benefit of $2.2 million to our provision for income taxes in the three and nine month periods ended September 30, 2017, respectively, compared to what it would have been under the previous accounting rules. In May 2014, the FASB issued ASU 2014-09 – Revenue from Contracts with Customers. This ASU provides a five-step model for revenue recognition that all industries will apply to recognize revenue when a customer obtains control of a good or service. This ASU will be effective for us beginning January 1, 2018. Entities are permitted to apply the standard and related amendments either retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the ASU recognized at the date of initial application. During the fourth quarter of 2016, we commenced an initial evaluation of the new standard and a related assessment and review of a representative sample of existing revenue contracts with our customers on some of our most significant revenue streams. In 2017, we have expanded our scope to perform an analysis at locations with less significant revenue streams and have provided training on the new standard to finance personnel across all of our locations. Our assessment of our revenue streams is substantially complete. Based upon our assessment, we do not believe there will be a material change to the timing of our revenue recognition. However, we will be required to reclassify certain immaterial costs from selling, general and administrative (“SG&A”) expense to net sales, which will result in a reduction of net sales, but have no impact on operating profit. In the fourth quarter of 2017, we will focus on additional disclosures we may need to make and the effect of this ASU on our internal control over financial reporting or other changes in business practices and processes. We plan to adopt this new standard using the retrospective method, which will result in us restating prior reporting periods presented. As noted previously, we expect this will result in us reclassifying certain immaterial costs from SG&A expense to net sales in each of those prior reporting periods. Our evaluation of ASU 2014-09 is ongoing and not complete. In February 2016, the FASB issued ASU 2016-02 – Leases. This ASU requires lessees to recognize right-of-use assets and lease liabilities on the balance sheet. This ASU will be effective for us beginning January 1, 2019. Early adoption is permitted. The ASU must be adopted using a modified retrospective transition approach at the beginning of the earliest comparative period in the consolidated financial statements. We own most of our manufacturing facilities, but lease various office space throughout the world. We are formalizing our project team and in the fourth quarter of 2017 will begin evaluating our leases and the related impact this ASU will have on our consolidated financial statements. In March 2017, the FASB issued ASU 2017-07 – Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This ASU requires us to report the service cost component of pensions in the same location as other compensation costs arising from services rendered by the pertinent employees during the period. We will be required to report the other components of net benefit costs in Other Income (Expense) in the statement of earnings. This ASU will be effective for us beginning January 1, 2018. The ASU must be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost in the statement of earnings and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension cost in assets. See Note 12 for further information on the components of our net benefit cost. In August 2017, the FASB issued ASU 2017-12 – Targeted Improvements to Accounting for Hedging Activities. This ASU amends the hedge accounting guidance to simplify the application of hedge accounting, makes more financial and nonfinancial hedging strategies eligible for hedge accounting treatment, changes how companies assess effectiveness and updates presentation and disclosure requirements. We are currently evaluating the impact this ASU will have on our consolidated financial statements; however, based on our current hedging portfolio, we do not anticipate that this ASU will have a significant impact on our financial position, results of operations or cash flows. This ASU will be effective for us January 1, 2019, with early adoption permitted. After adoption, we may explore new hedging opportunities that are eligible for hedge accounting treatment under the new standard. There are no other recently issued accounting pronouncements that we have not yet adopted that are expected to have a material effect on our financial position, results of operations or cash flows. |
Significant Accounting Polici23
Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Expenses in Special Items | “Special items” included (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Biomet merger-related Consulting and professional fees $ 19.9 $ 59.0 $ 60.7 $ 138.4 Employee termination benefits 5.4 7.1 12.0 14.3 Dedicated project personnel 10.2 21.9 33.1 64.8 Relocated facilities 1.8 9.5 6.1 17.5 Certain litigation matters 5.0 - 5.0 - Contract terminations - 3.5 - 28.8 Information technology integration 1.3 4.8 4.9 9.3 Goodwill and intangible asset impairment 32.7 - 59.5 28.0 Other 4.8 8.0 25.0 12.4 Total Biomet merger-related 81.1 113.8 206.3 313.5 Other Consulting and professional fees 56.3 14.6 158.4 30.3 Employee termination benefits (0.6 ) 3.2 2.0 3.2 Dedicated project personnel 14.0 8.2 35.5 11.5 Impairment/loss on disposal of assets - - - 1.1 LDR merger consideration compensation expense - 24.1 - 24.1 Relocated facilities 0.6 - 3.1 0.2 Certain litigation matters 3.0 3.7 10.0 3.7 Contract terminations - 0.1 - 1.1 Information technology integration 1.0 0.8 1.8 1.1 Certain R&D agreements - - 2.5 - Contingent consideration adjustments 1.7 - (1.5 ) - Other 8.3 1.9 16.0 7.2 Total Other 84.3 56.6 227.8 83.5 Special items $ 165.4 $ 170.4 $ 434.1 $ 397.0 |
Summary of Liabilities Related to Integration Plans | The following table summarizes the liabilities related to these integration plans (in millions): Employee Termination Contract Benefits Terminations Total Balance at December 31, 2016 $ 38.1 $ 35.1 $ 73.2 Additions 12.0 - 12.0 Cash payments (33.1 ) (9.4 ) (42.5 ) Foreign currency exchange rate changes 1.2 0.4 1.6 Balance at September 30, 2017 $ 18.2 $ 26.1 $ 44.3 |
Business Combinations (Tables)
Business Combinations (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Changes in Carrying Amount of Goodwill | The following table summarizes the changes in the carrying amount of our goodwill (in millions): Americas EMEA Asia Pacific Product Category Operating Segments Total Balance at December 31, 2016 Goodwill $ 7,634.5 $ 1,263.7 $ 487.3 $ 1,631.4 $ 11,016.9 Accumulated impairment loss - - - (373.0 ) (373.0 ) 7,634.5 1,263.7 487.3 1,258.4 10,643.9 LDR purchase accounting - - - 24.8 24.8 Other acquisitions 13.2 (24.1 ) - 27.6 16.7 Currency translation 82.5 110.0 10.0 49.7 252.2 Impairment - - - (32.7 ) (32.7 ) Balance at September 30, 2017 Goodwill 7,730.2 1,349.6 497.3 1,733.5 11,310.6 Accumulated impairment loss - - - (405.7 ) (405.7 ) $ 7,730.2 $ 1,349.6 $ 497.3 $ 1,327.8 $ 10,904.9 |
LDR Holding Corporation [Member] | |
Summary of Aggregate Final Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the final estimated fair value of the assets acquired and liabilities assumed in the LDR acquisition (in millions): Final Values Cash $ 92.8 Accounts receivable, net 30.5 Inventory 97.0 Other current assets 5.6 Property, plant and equipment 24.7 Intangible assets not subject to amortization: In-process research and development (IPR&D) 2.0 Intangible assets subject to amortization: Technology 447.0 Customer relationships 122.0 Trademarks and trade names 74.0 Other assets 73.8 Goodwill 507.2 Total assets acquired 1,476.6 Current liabilities 122.5 Long-term debt 0.5 Deferred taxes 236.7 Other long-term liabilities 3.0 Total liabilities assumed 362.7 Net assets acquired $ 1,113.9 |
Cayenne Medical, CTC, CDD and MedTech [Member] | |
Summary of Aggregate Final Estimated Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the aggregate final estimated fair value of the assets acquired and liabilities assumed related to the Cayenne Medical, CTC, CD Diagnostics, MedTech, and other immaterial acquisitions that occurred during the year ended December 31, 2016 (in millions): Current assets $ 66.4 Property, plant and equipment 4.5 Intangible assets 172.9 Goodwill 337.1 Other assets 38.2 Total assets acquired 619.1 Current liabilities 20.0 Long-term liabilities 99.4 Total liabilities assumed 119.4 Net assets acquired $ 499.7 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | September 30, December 31, 2017 2016 (in millions) Finished goods $ 1,674.2 $ 1,556.9 Work in progress 189.6 141.7 Raw materials 220.4 260.8 Inventories $ 2,084.2 $ 1,959.4 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Property Plant And Equipment [Abstract] | |
Summary of Property, Plant and Equipment | September 30, December 31, 2017 2016 (in millions) Land $ 29.4 $ 37.0 Buildings and equipment 1,833.5 1,789.9 Capitalized software costs 406.8 397.2 Instruments 2,634.4 2,347.6 Construction in progress 111.3 99.8 5,015.4 4,671.5 Accumulated depreciation (2,966.8 ) (2,633.6 ) Property, plant and equipment, net $ 2,048.6 $ 2,037.9 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Debt Disclosure [Abstract] | |
Summary of Debt Instruments | Our debt consisted of the following (in millions): September 30, December 31, 2017 2016 Current portion of long-term debt 1.450% Senior Notes due 2017 $ - $ 500.0 2.000% Senior Notes due 2018 1,150.0 - U.S. Term Loan B 75.0 75.0 Other short-term debt - 0.6 Total current portion of long-term debt $ 1,225.0 $ 575.6 Long-term debt 2.000% Senior Notes due 2018 $ - $ 1,150.0 4.625% Senior Notes due 2019 500.0 500.0 2.700% Senior Notes due 2020 1,500.0 1,500.0 3.375% Senior Notes due 2021 300.0 300.0 3.150% Senior Notes due 2022 750.0 750.0 3.550% Senior Notes due 2025 2,000.0 2,000.0 4.250% Senior Notes due 2035 253.4 253.4 5.750% Senior Notes due 2039 317.8 317.8 4.450% Senior Notes due 2045 395.4 395.4 1.414% Euro Notes due 2022 591.1 527.4 2.425% Euro Notes due 2026 591.1 527.4 U.S. Term Loan A 1,135.0 1,700.0 U.S. Term Loan B 600.0 675.0 Japan Term Loan A 103.9 99.6 Japan Term Loan B 189.1 - Other long-term debt 4.1 4.2 Debt discount and issuance costs (56.3 ) (65.8 ) Adjustment related to interest rate swaps 25.1 31.4 Total long-term debt $ 9,199.7 $ 10,665.8 |
Accumulated Other Comprehensi28
Accumulated Other Comprehensive Income (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Equity [Abstract] | |
Changes in Components of Accumulated Other Comprehensive Income, Net of Tax | The following table shows the changes in the components of AOCI, net of tax (in millions): Foreign Cash Unrealized Defined Currency Flow (Losses) Gains on Benefit Translation Hedges Securities Plan Items Balance at December 31, 2016 $ (323.4 ) $ 32.3 $ (0.1 ) $ (142.8 ) AOCI before reclassifications 367.9 (79.4 ) - (10.1 ) Reclassifications - (9.4 ) - 5.1 Balance at September 30, 2017 $ 44.5 $ (56.5 ) $ (0.1 ) $ (147.8 ) |
Reclassification Adjustments from Accumulated Other Comprehensive Income | The following table shows the reclassification adjustments from AOCI (in millions): Amount of Gain (Loss) Reclassified from AOCI Three Months Ended Nine Months Ended September 30, September 30, Location on Component of AOCI 2017 2016 2017 2016 Statement of Earnings Cash flow hedges Foreign exchange forward contracts $ (5.1 ) $ 18.1 $ 12.0 $ 76.5 Cost of products sold Forward starting interest rate swaps (0.1 ) (0.4 ) (0.4 ) (1.3 ) Interest expense (5.2 ) 17.7 11.6 75.2 Total before tax (1.1 ) 3.8 2.2 17.2 Provision for income taxes $ (4.1 ) $ 13.9 $ 9.4 $ 58.0 Net of tax Defined benefit plans Prior service cost $ 2.6 $ 1.9 $ 7.7 $ 5.8 * Unrecognized actuarial (loss) (5.4 ) (5.1 ) (16.2 ) (15.1 ) * (2.8 ) (3.2 ) (8.5 ) (9.3 ) Total before tax (1.1 ) (1.0 ) (3.4 ) (3.3 ) Benefit for income taxes $ (1.7 ) $ (2.2 ) $ (5.1 ) $ (6.0 ) Net of tax Total reclassifications $ (5.8 ) $ 11.7 $ 4.3 $ 52.0 Net of tax * These AOCI components are included in the computation of net periodic pension expense (see Note 12). |
Tax Effects on Each Component of Accumulated Other Comprehensive Income Recognized in Statements of Comprehensive Income | The following table shows the tax effects on each component of AOCI recognized in our condensed consolidated statements of comprehensive income (in millions): Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Before Tax Tax Net of Tax Before Tax Tax Net of Tax Foreign currency cumulative translation adjustments $ 145.0 $ 15.3 $ 129.7 $ 414.6 $ 46.7 $ 367.9 Unrealized cash flow hedge (losses) (35.9 ) (7.6 ) (28.3 ) (99.0 ) (19.6 ) (79.4 ) Reclassification adjustments on cash flow hedges 5.2 1.1 4.1 (11.6 ) (2.2 ) (9.4 ) Adjustments to prior service cost and unrecognized actuarial assumptions 0.5 1.5 (1.0 ) (2.9 ) 2.1 (5.0 ) Total Other Comprehensive Income $ 114.8 $ 10.3 $ 104.5 $ 301.1 $ 27.0 $ 274.1 Three Months Ended September 30, 2016 Nine Months Ended September 30, 2016 Before Tax Tax Net of Tax Before Tax Tax Net of Tax Foreign currency cumulative translation adjustments $ 58.3 $ - $ 58.3 $ 113.9 $ - $ 113.9 Unrealized cash flow hedge (losses) gains (16.1 ) (6.4 ) (9.7 ) (80.9 ) (27.9 ) (53.0 ) Reclassification adjustments on cash flow hedges (17.7 ) (3.8 ) (13.9 ) (75.2 ) (17.2 ) (58.0 ) Unrealized gains on securities - - - 0.4 - 0.4 Adjustments to prior service cost and unrecognized actuarial assumptions 2.2 1.0 1.2 25.6 3.3 22.3 Total Other Comprehensive Loss $ 26.7 $ (9.2 ) $ 35.9 $ (16.2 ) $ (41.8 ) $ 25.6 |
Fair Value Measurement of Ass29
Fair Value Measurement of Assets and Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement of Assets and Liabilities | The following assets and liabilities are recorded at fair value on a recurring basis (in millions): As of September 30, 2017 Fair Value Measurements at Reporting Date Using: Description Recorded Balance Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets Derivatives, current and long-term Foreign currency forward contracts $ 3.9 $ - $ 3.9 $ - Interest rate swaps 3.8 - 3.8 - Total Assets $ 7.7 $ - $ 7.7 $ - Liabilities Derivatives, current and long-term Foreign currency forward contracts $ 39.5 $ - $ 39.5 $ - Contingent payments related to acquisitions 44.0 - - 44.0 Total Liabilities $ 83.5 $ - $ 39.5 $ 44.0 As of December 31, 2016 Fair Value Measurements at Reporting Date Using: Description Recorded Balance Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets Derivatives, current and long-term Foreign currency forward contracts $ 65.3 $ - $ 65.3 $ - Interest rate swaps 4.0 - 4.0 - Total Assets $ 69.3 $ - $ 69.3 $ - Liabilities Derivatives, current and long-term Foreign currency forward contracts $ 0.3 $ - $ 0.3 $ - Contingent payments related to acquisitions 62.8 - - 62.8 Total Liabilities $ 63.1 $ - $ 0.3 $ 62.8 |
Derivative Instruments and He30
Derivative Instruments and Hedging Activities (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Instruments Designated as Fair Value Hedges | Derivative instruments designated as fair value hedges had the following effects on our condensed consolidated statements of earnings (in millions): Gain (Loss) on Gain (Loss) on Instrument Hedged Item Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended Location on September 30, September 30, September 30, September 30, Derivative Instrument Statement of Earnings 2017 2016 2017 2016 2017 2016 2017 2016 Interest rate swaps Interest expense $ - $ (3.8 ) $ - $ 10.1 $ - $ 3.8 $ - $ (10.1 ) |
Gross Unrealized Losses from Derivative Instruments | Derivative instruments designated as cash flow hedges had the following effects, before taxes, on AOCI and Net earnings on our condensed consolidated statements of earnings, condensed consolidated statements of comprehensive income and condensed consolidated balance sheets (in millions): Amount of Gain (Loss) Amount of Gain (Loss) Recognized in AOCI Reclassified from AOCI Three Months Ended Nine Months Ended Three Months Ended Nine Months Ended September 30, September 30, Location on September 30, September 30, Derivative Instrument 2017 2016 2017 2016 Statement of Earnings 2017 2016 2017 2016 Foreign exchange forward contracts $ (35.6 ) $ (16.1 ) $ (98.7 ) $ (80.9 ) Cost of products sold $ (5.1 ) $ 18.1 $ 12.0 $ 76.5 Interest rate swaps (0.3 ) - (0.3 ) - Interest expense - - - - Forward starting interest rate swaps - - - - Interest expense (0.1 ) (0.4 ) (0.4 ) (1.3 ) $ (35.9 ) $ (16.1 ) $ (99.0 ) $ (80.9 ) $ (5.2 ) $ 17.7 $ 11.6 $ 75.2 |
Derivative Instruments Not Designated as Hedging Instruments | The following losses from these derivative instruments were recognized on our condensed consolidated statements of earnings (in millions): Three Months Ended Nine Months Ended Location on September 30, September 30, Derivative Instrument Statement of Earnings 2017 2016 2017 2016 Foreign exchange forward contracts Other expense, net $ (16.3 ) $ (5.1 ) $ (54.9 ) $ (42.3 ) |
Fair Value of Derivative Instruments on Gross Basis | The fair value of derivative instruments on a gross basis is as follows (in millions): As of September 30, 2017 As of December 31, 2016 Balance Balance Sheet Fair Sheet Fair Location Value Location Value Asset Derivatives Foreign exchange forward contracts Other current assets $ 15.9 Other current assets $ 57.9 Foreign exchange forward contracts Other assets 7.4 Other assets 34.9 Interest rate swaps Other assets 3.8 Other assets 4.0 Total asset derivatives $ 27.1 $ 96.8 Liability Derivatives Foreign exchange forward contracts Other current liabilities $ 37.2 Other current liabilities $ 20.9 Foreign exchange forward contracts Other long-term liabilities 21.7 Other long-term liabilities 6.9 Total liability derivatives $ 58.9 $ 27.8 |
Schedule of Effects of Master Netting Agreements on Condensed Consolidated Balance Sheets | The table below presents the effects of our master netting agreements on our condensed consolidated balance sheets (in millions): As of September 30, 2017 As of December 31, 2016 Description Location Gross Amount Offset Net Amount in Balance Sheet Gross Amount Offset Net Amount in Balance Sheet Asset Derivatives Cash flow hedges Other current assets $ 15.9 $ 13.6 $ 2.3 $ 57.9 $ 20.6 $ 37.3 Cash flow hedges Other assets 7.4 5.8 1.6 34.9 6.8 28.1 Liability Derivatives Cash flow hedges Other current liabilities 37.2 13.6 23.6 20.9 20.6 0.3 Cash flow hedges Other long-term liabilities 21.7 5.8 15.9 6.9 6.8 0.1 |
Net Investment Hedge Gains Recognized on Consolidated Statements of Comprehensive Income | The following net investment hedge losses were recognized on our condensed consolidated statements of comprehensive income (in millions): Amount of Loss Recognized in OCI Three Months Ended Nine Months Ended September 30, September 30, Derivative Instrument 2017 2016 2017 2016 Euro Notes $ (41.7 ) $ - $ (127.5 ) $ - |
Retirement Benefit Plans (Table
Retirement Benefit Plans (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Compensation And Retirement Disclosure [Abstract] | |
Components of Net Pension Expense | The components of net periodic pension expense for our U.S. and foreign defined benefit pension plans are as follows (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Service cost $ 7.1 $ 7.6 $ 21.0 $ 22.8 Interest cost 4.6 4.7 13.9 19.3 Expected return on plan assets (10.1 ) (10.2 ) (30.3 ) (35.6 ) Curtailment gain (loss) 0.2 (0.4 ) 0.4 (1.0 ) Amortization of prior service cost (2.6 ) (1.9 ) (7.7 ) (5.8 ) Amortization of unrecognized actuarial loss 5.4 5.1 16.2 15.1 Net periodic pension expense $ 4.6 $ 4.9 $ 13.5 $ 14.8 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of Weighted Average Shares for Basic and Diluted Shares Computations | The following is a reconciliation of weighted average shares for the basic and diluted shares computations (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Weighted average shares outstanding for basic net earnings per share 202.3 200.1 201.7 199.9 Effect of dilutive stock options and other equity awards 1.7 2.8 1.9 2.4 Weighted average shares outstanding for diluted net earnings per share 204.0 202.9 203.6 202.3 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Summary of Net sales and Operating Profit by Segment | Net sales and operating profit by segment are as follows (in millions): Net Sales Operating Profit Three Months Ended Three Months Ended September 30, September 30, 2017 2016 2017 2016 Americas $ 921.2 $ 946.6 $ 502.3 $ 515.6 EMEA 335.4 322.1 97.5 92.3 Asia Pacific 281.7 274.5 101.5 106.3 Product Category Operating Segments 279.8 289.6 51.1 47.5 Global Operations and Corporate Functions - - (210.5 ) (208.7 ) Total $ 1,818.1 $ 1,832.8 Inventory step-up and other inventory and manufacturing related charges (10.4 ) (22.8 ) Intangible asset amortization (152.7 ) (164.3 ) Special items (165.4 ) (170.4 ) Operating profit $ 213.4 $ 195.5 Net Sales Operating Profit Nine Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Americas $ 2,900.0 $ 2,909.6 $ 1,568.8 $ 1,574.1 EMEA 1,108.5 1,122.7 348.2 368.0 Asia Pacific 850.5 806.9 318.5 331.4 Product Category Operating Segments 890.8 831.6 197.2 177.1 Global Operations and Corporate Functions - - (641.6 ) (628.6 ) Total $ 5,749.8 $ 5,670.8 Inventory step-up and other inventory and manufacturing related charges (58.5 ) (357.7 ) Intangible asset amortization (452.4 ) (424.7 ) Special items (434.1 ) (397.0 ) Operating profit $ 846.1 $ 642.6 |
Summary of Net Sales by Product Category | Net sales by product category are as follows (in millions): Three Months Ended Nine Months Ended September 30, September 30, 2017 2016 2017 2016 Knees $ 623.7 $ 631.5 $ 2,005.9 $ 2,031.7 Hips 434.5 440.6 1,380.0 1,385.7 S.E.T. 406.6 401.8 1,254.5 1,215.0 Dental 92.9 95.9 311.1 322.5 Spine & CMF 184.9 183.7 565.2 470.7 Other 75.5 79.3 233.1 245.2 Total $ 1,818.1 $ 1,832.8 $ 5,749.8 $ 5,670.8 |
Significant Accounting Polici34
Significant Accounting Policies - Summary of Expenses in Special Items (Detail) - USD ($) $ in Millions | Jul. 13, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 |
Biomet merger-related | |||||
Consulting and professional fees | $ 19.9 | $ 59 | $ 60.7 | $ 138.4 | |
Employee termination benefits | 5.4 | 7.1 | 12 | 14.3 | |
Dedicated project personnel | 10.2 | 21.9 | 33.1 | 64.8 | |
Relocated facilities | 1.8 | 9.5 | 6.1 | 17.5 | |
Certain litigation matters | 5 | 5 | |||
Contract terminations | 3.5 | 28.8 | |||
Information technology integration | 1.3 | 4.8 | 4.9 | 9.3 | |
Goodwill and intangible asset impairment | 32.7 | 59.5 | 28 | ||
Other | 4.8 | 8 | 25 | 12.4 | |
Total Biomet merger-related | 81.1 | 113.8 | 206.3 | 313.5 | |
Other | |||||
Consulting and professional fees | 56.3 | 14.6 | 158.4 | 30.3 | |
Employee termination benefits | (0.6) | 3.2 | 2 | 3.2 | |
Dedicated project personnel | 14 | 8.2 | 35.5 | 11.5 | |
Impairment/loss on disposal of assets | 1.1 | ||||
Relocated facilities | 0.6 | 3.1 | 0.2 | ||
Certain litigation matters | 3 | 3.7 | 10 | 3.7 | |
Contract terminations | 0.1 | 1.1 | |||
Information technology integration | 1 | 0.8 | 1.8 | 1.1 | |
Certain R&D agreements | 2.5 | ||||
Contingent consideration adjustments | 1.7 | (1.5) | |||
Other | 8.3 | 1.9 | 16 | 7.2 | |
Total Other | 84.3 | 56.6 | 227.8 | 83.5 | |
Special items | $ 165.4 | 170.4 | $ 434.1 | 397 | |
LDR Holding Corporation [Member] | |||||
Other | |||||
Merger consideration compensation expense | $ 24.1 | $ 24.1 | $ 24.1 |
Significant Accounting Polici35
Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Business And Significant Accounting Policies [Line Items] | ||||
Goodwill impairment charge | $ 32.7 | |||
Provision for income taxes | $ 28.4 | $ (54.4) | 6.6 | $ 133.9 |
ASU 2016-16 [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Provision for income taxes | 1.5 | (2.2) | ||
Retained Earnings [Member] | ASU 2016-16 [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Cumulative effect of Retained earnings on new accounting principle adoption | (72.7) | (72.7) | ||
Other Prepaid Expenses and Current Assets [Member] | ASU 2016-16 [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Cumulative effect of Retained earnings on new accounting principle adoption | (3.9) | (3.9) | ||
Other Assets [Member] | ASU 2016-16 [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Cumulative effect of Retained earnings on new accounting principle adoption | (22.4) | (22.4) | ||
Income Taxes Payable [Member] | ASU 2016-16 [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Cumulative effect of Retained earnings on new accounting principle adoption | (2) | (2) | ||
Deferred Income Taxes [Member] | ASU 2016-16 [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Cumulative effect of Retained earnings on new accounting principle adoption | 48.4 | 48.4 | ||
Employee Severance [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Restructuring Cost | 170 | 170 | ||
Cumulative restructuring cost | 163.8 | 163.8 | ||
Contract Terminations [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Restructuring Cost | 140 | 140 | ||
Cumulative restructuring cost | 134.9 | 134.9 | ||
Office Based Technologies [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Goodwill impairment charge | 32.7 | 32.7 | ||
In Process Research and Development (IPR&D) [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Intangible assets | 209 | 209 | ||
Impairment loss on intangible asset | 18.8 | $ 28 | ||
Trademarks [Member] | ||||
Business And Significant Accounting Policies [Line Items] | ||||
Intangible assets | $ 479 | 479 | ||
Impairment loss on intangible asset | $ 8 |
Significant Accounting Polici36
Significant Accounting Policies - Summary of Liabilities Related to Integration Plans (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Schedule Of Business Acquisitions Liabilities Related To Integration Plans [Line Items] | |
Balance at December 31, 2016 | $ 73.2 |
Additions | 12 |
Cash payments | (42.5) |
Foreign currency exchange rate changes | 1.6 |
Balance at September 30, 2017 | 44.3 |
Employee Termination Benefits [Member] | |
Schedule Of Business Acquisitions Liabilities Related To Integration Plans [Line Items] | |
Balance at December 31, 2016 | 38.1 |
Additions | 12 |
Cash payments | (33.1) |
Foreign currency exchange rate changes | 1.2 |
Balance at September 30, 2017 | 18.2 |
Contract Terminations [Member] | |
Schedule Of Business Acquisitions Liabilities Related To Integration Plans [Line Items] | |
Balance at December 31, 2016 | 35.1 |
Cash payments | (9.4) |
Foreign currency exchange rate changes | 0.4 |
Balance at September 30, 2017 | $ 26.1 |
Business Combinations - Additio
Business Combinations - Additional Information (Detail) - USD ($) $ in Millions | Jul. 13, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 |
Business Acquisition [Line Items] | ||||||
Goodwill impairment charge | $ 32.7 | |||||
Office Based Technologies [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill impairment charge | $ 32.7 | $ 32.7 | ||||
LDR Holding Corporation [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Total consideration | $ 1,138 | |||||
Merger consideration compensation expense | 24.1 | $ 24.1 | $ 24.1 | |||
Net assets acquired | $ 1,113.9 | |||||
Cayenne Medical, CTC, CDD and MedTech [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Total consideration | $ 441.7 | |||||
Net assets acquired | 499.7 | |||||
Contingent consideration fair value | $ 58 |
Business Combinations - Summary
Business Combinations - Summary of Fair Values of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 | Jul. 13, 2016 |
Business Acquisition [Line Items] | |||
Goodwill | $ 10,904.9 | $ 10,643.9 | |
In Process Research and Development (IPR&D) [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets not subject to amortization | $ 209 | ||
LDR Holding Corporation [Member] | |||
Business Acquisition [Line Items] | |||
Cash | $ 92.8 | ||
Accounts receivable, net | 30.5 | ||
Inventory | 97 | ||
Other current assets | 5.6 | ||
Property, plant and equipment | 24.7 | ||
Other assets | 73.8 | ||
Goodwill | 507.2 | ||
Total assets acquired | 1,476.6 | ||
Current liabilities | 122.5 | ||
Long-term debt | 0.5 | ||
Deferred taxes | 236.7 | ||
Other long-term liabilities | 3 | ||
Total liabilities assumed | 362.7 | ||
Net assets acquired | 1,113.9 | ||
LDR Holding Corporation [Member] | Trademarks and Trade Names [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets subject to amortization | 74 | ||
LDR Holding Corporation [Member] | In Process Research and Development (IPR&D) [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets not subject to amortization | 2 | ||
LDR Holding Corporation [Member] | Technology [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets subject to amortization | 447 | ||
LDR Holding Corporation [Member] | Customer Relationships [Member] | |||
Business Acquisition [Line Items] | |||
Intangible assets subject to amortization | $ 122 |
Business Combinations - Summa39
Business Combinations - Summary of Aggregate Final Estimated Fair Values of Assets Acquired and Liabilities Assumed (Detail) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | ||
Goodwill | $ 10,904.9 | $ 10,643.9 |
Cayenne Medical, CTC, CDD and MedTech [Member] | ||
Business Acquisition [Line Items] | ||
Current assets | 66.4 | |
Property, plant and equipment | 4.5 | |
Intangible assets | 172.9 | |
Goodwill | 337.1 | |
Other assets | 38.2 | |
Total assets acquired | 619.1 | |
Current liabilities | 20 | |
Long-term liabilities | 99.4 | |
Total liabilities assumed | 119.4 | |
Net assets acquired | $ 499.7 |
Business Combinations - Changes
Business Combinations - Changes in Carrying Amount of Goodwill (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Goodwill [Line Items] | |
Goodwill, Beginning Balance | $ 11,016.9 |
Accumulated impairment loss, Beginning Balance | (373) |
Goodwill, net of accumulated impairment loss, Beginning Balance | 10,643.9 |
Purchase accounting adjustments | 16.7 |
Currency translation | 252.2 |
Impairment | (32.7) |
Goodwill, Ending Balance | 11,310.6 |
Accumulated impairment loss, Ending Balance | (405.7) |
Goodwill, net of accumulated impairment loss, Ending Balance | 10,904.9 |
LDR Holding Corporation [Member] | |
Goodwill [Line Items] | |
Purchase accounting adjustments | 24.8 |
Americas [Member] | |
Goodwill [Line Items] | |
Goodwill, Beginning Balance | 7,634.5 |
Goodwill, net of accumulated impairment loss, Beginning Balance | 7,634.5 |
Purchase accounting adjustments | 13.2 |
Currency translation | 82.5 |
Goodwill, Ending Balance | 7,730.2 |
Goodwill, net of accumulated impairment loss, Ending Balance | 7,730.2 |
EMEA [Member] | |
Goodwill [Line Items] | |
Goodwill, Beginning Balance | 1,263.7 |
Goodwill, net of accumulated impairment loss, Beginning Balance | 1,263.7 |
Purchase accounting adjustments | (24.1) |
Currency translation | 110 |
Goodwill, Ending Balance | 1,349.6 |
Goodwill, net of accumulated impairment loss, Ending Balance | 1,349.6 |
Asia Pacific [Member] | |
Goodwill [Line Items] | |
Goodwill, Beginning Balance | 487.3 |
Goodwill, net of accumulated impairment loss, Beginning Balance | 487.3 |
Currency translation | 10 |
Goodwill, Ending Balance | 497.3 |
Goodwill, net of accumulated impairment loss, Ending Balance | 497.3 |
Product Category Operating Segments [Member] | |
Goodwill [Line Items] | |
Goodwill, Beginning Balance | 1,631.4 |
Accumulated impairment loss, Beginning Balance | (373) |
Goodwill, net of accumulated impairment loss, Beginning Balance | 1,258.4 |
Purchase accounting adjustments | 27.6 |
Currency translation | 49.7 |
Impairment | (32.7) |
Goodwill, Ending Balance | 1,733.5 |
Accumulated impairment loss, Ending Balance | (405.7) |
Goodwill, net of accumulated impairment loss, Ending Balance | 1,327.8 |
Product Category Operating Segments [Member] | LDR Holding Corporation [Member] | |
Goodwill [Line Items] | |
Purchase accounting adjustments | $ 24.8 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Detail) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 1,674.2 | $ 1,556.9 |
Work in progress | 189.6 | 141.7 |
Raw materials | 220.4 | 260.8 |
Inventories | $ 2,084.2 | $ 1,959.4 |
Inventories - Additional Inform
Inventories - Additional Information (Detail) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Finished goods inventory step-up | $ 0.7 | $ 35.3 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property, Plant and Equipment (Detail) - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | $ 5,015.4 | $ 4,671.5 |
Accumulated depreciation | (2,966.8) | (2,633.6) |
Property, plant and equipment, net | 2,048.6 | 2,037.9 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 29.4 | 37 |
Buildings And Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 1,833.5 | 1,789.9 |
Capitalized Software Costs [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 406.8 | 397.2 |
Instruments [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | 2,634.4 | 2,347.6 |
Construction in Progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Gross | $ 111.3 | $ 99.8 |
Transfers of Financial Assets -
Transfers of Financial Assets - Additional Information (Detail) - USD ($) | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Transfer of Financial Assets Accounted for as Sales [Line Items] | ||
Aggregate face value of receivables sold | $ 1,050,500,000 | |
Cash proceeds from receivables | 1,049,800,000 | |
Proceeds from customers | 682,200,000 | |
Repurchase of accounts receivables sold | 58,900,000 | |
Incremental operating cash inflows | 273,000,000 | |
Revolving Credit Facility [Member] | ||
Transfer of Financial Assets Accounted for as Sales [Line Items] | ||
Current maximum funding limit | 315,000,000 | |
U.S and Japan Revolving Arrangements [Member] | ||
Transfer of Financial Assets Accounted for as Sales [Line Items] | ||
Maximum exposures to loss associated | 24,400,000 | $ 5,200,000 |
U.S Revolving Arrangements [Member] | ||
Transfer of Financial Assets Accounted for as Sales [Line Items] | ||
Derecognized net receivables outstanding amount | 210,600,000 | |
Japan Revolving Arrangements [Member] | ||
Transfer of Financial Assets Accounted for as Sales [Line Items] | ||
Derecognized net receivables outstanding amount | $ 65,500,000 |
Debt - Summary of Debt Instrume
Debt - Summary of Debt Instruments (Detail) $ in Millions, ¥ in Billions | Sep. 30, 2017USD ($) | Sep. 30, 2017JPY (¥) | Dec. 31, 2016USD ($) |
Current portion of long-term debt | |||
Other short-term debt | $ 0.6 | ||
Total current portion of long-term debt | $ 1,225 | 575.6 | |
Long-term debt | |||
Senior Notes due | 8,300 | ||
Other long-term debt | 4.1 | 4.2 | |
Debt discount and issuance costs | (56.3) | (65.8) | |
Adjustment related to interest rate swaps | 25.1 | 31.4 | |
Total long-term debt | 9,199.7 | 10,665.8 | |
Senior Notes [Member] | 1.450% [Member] | Due in 2017 [Member] | |||
Current portion of long-term debt | |||
Total current portion of long-term debt | 500 | ||
Senior Notes [Member] | 2.0% [Member] | Due in 2018 [Member] | |||
Current portion of long-term debt | |||
Total current portion of long-term debt | 1,150 | ||
Long-term debt | |||
Senior Notes due | 1,150 | ||
Senior Notes [Member] | 4.625% [Member] | Due in 2019 [Member] | |||
Long-term debt | |||
Senior Notes due | 500 | 500 | |
Senior Notes [Member] | 2.70% [Member] | Due in 2020 [Member] | |||
Long-term debt | |||
Senior Notes due | 1,500 | 1,500 | |
Senior Notes [Member] | 3.375% [Member] | Due in 2021 [Member] | |||
Long-term debt | |||
Senior Notes due | 300 | 300 | |
Senior Notes [Member] | 3.150% [Member] | Due in 2022 [Member] | |||
Long-term debt | |||
Senior Notes due | 750 | 750 | |
Senior Notes [Member] | 3.550% [Member] | Due in 2025 [Member] | |||
Long-term debt | |||
Senior Notes due | 2,000 | 2,000 | |
Senior Notes [Member] | 4.250% [Member] | Due in 2035 [Member] | |||
Long-term debt | |||
Senior Notes due | 253.4 | 253.4 | |
Senior Notes [Member] | 5.750% [Member] | Due in 2039 [Member] | |||
Long-term debt | |||
Senior Notes due | 317.8 | 317.8 | |
Senior Notes [Member] | 4.450% [Member] | Due in 2045 [Member] | |||
Long-term debt | |||
Senior Notes due | 395.4 | 395.4 | |
Euro Notes [Member] | |||
Long-term debt | |||
Term loan | 1,200 | ||
Euro Notes [Member] | 1.414% [Member] | Due in 2022 [Member] | |||
Long-term debt | |||
Term loan | 591.1 | 527.4 | |
Euro Notes [Member] | 2.425% [Member] | Due in 2026 [Member] | |||
Long-term debt | |||
Term loan | 591.1 | 527.4 | |
U.S. Term Loan A [Member] | |||
Long-term debt | |||
Term loan | 1,135 | 1,700 | |
U.S. Term Loan B [Member] | |||
Current portion of long-term debt | |||
Total current portion of long-term debt | 75 | 75 | |
Long-term debt | |||
Term loan | 600 | 675 | |
Japan Term Loan A [Member] | |||
Long-term debt | |||
Term loan | 103.9 | ¥ 11.7 | $ 99.6 |
Japan Term Loan B [Member] | |||
Long-term debt | |||
Term loan | $ 189.1 | ¥ 21.3 |
Debt - Summary of Debt Instru46
Debt - Summary of Debt Instruments (Parenthetical) (Detail) | Sep. 30, 2017 | Dec. 31, 2016 |
1.450% [Member] | Due in 2017 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.45% | 1.45% |
2.0% [Member] | Due in 2018 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 2.00% | 2.00% |
4.625% [Member] | Due in 2019 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 4.625% | 4.625% |
2.70% [Member] | Due in 2020 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 2.70% | 2.70% |
3.375% [Member] | Due in 2021 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 3.375% | 3.375% |
3.150% [Member] | Due in 2022 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 3.15% | 3.15% |
3.550% [Member] | Due in 2025 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 3.55% | 3.55% |
4.250% [Member] | Due in 2035 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 4.25% | 4.25% |
5.750% [Member] | Due in 2039 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 5.75% | 5.75% |
4.450% [Member] | Due in 2045 [Member] | Senior Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 4.45% | 4.45% |
1.414% [Member] | Due in 2022 [Member] | Euro Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 1.414% | 1.414% |
2.425% [Member] | Due in 2026 [Member] | Euro Notes [Member] | ||
Debt Instrument [Line Items] | ||
Interest rate | 2.425% | 2.425% |
Debt - Additional Information (
Debt - Additional Information (Detail) ¥ in Billions | Sep. 22, 2017 | Sep. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2017JPY (¥) | Dec. 31, 2016USD ($) |
Debt Instrument [Line Items] | |||||
Aggregate principal amount of Senior Notes | $ 8,300,000,000 | ||||
Other debt and fair value adjustments, total | 29,200,000 | ||||
Debt discount and issuance costs | 56,300,000 | $ 65,800,000 | |||
Payments on term loan | 640,000,000 | $ 700,000,000 | |||
Estimated fair value of Senior Notes and term loan | 8,520,900,000 | ||||
Euro Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Term loan | 1,200,000,000 | ||||
U.S. Term Loan A [Member] | |||||
Debt Instrument [Line Items] | |||||
Term loan | $ 1,135,000,000 | 1,700,000,000 | |||
Maturity date of term loan | Jun. 24, 2020 | ||||
Principal payments due on a quarterly basis starting September 30, 2015, during first three years | $ 75,000,000 | ||||
Principal payments due on a quarterly basis starting September 30, 2015, during fourth year | 112,500,000 | ||||
Principal payments due on a quarterly basis starting September 30, 2015, during fifth year | 412,500,000 | ||||
Payments on term loan | 1,860,000,000 | ||||
U.S. Term Loan B [Member] | |||||
Debt Instrument [Line Items] | |||||
Term loan | $ 600,000,000 | 675,000,000 | |||
Maturity date of term loan | Sep. 30, 2019 | ||||
Term loan current and non-current | $ 675,000,000 | ||||
Payments on term loan | 75,000,000 | ||||
Principal payments due in first anniversary | 75,000,000 | ||||
Principal payments due in second anniversary | $ 75,000,000 | ||||
U.S. Term Loan B [Member] | Revolving Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity date of term loan | Sep. 30, 2019 | ||||
Japan Term Loan A [Member] | |||||
Debt Instrument [Line Items] | |||||
Term loan | $ 103,900,000 | ¥ 11.7 | $ 99,600,000 | ||
Maturity date of term loan | Sep. 27, 2022 | Sep. 27, 2022 | |||
Amended and restated date of term loan | May 24, 2012 | ||||
Amendment date of term loan | Oct. 31, 2014 | ||||
Interest rate | 0.635% | ||||
Estimated fair value of Senior Notes and term loan | $ 291,800,000 | ||||
Japan Term Loan B [Member] | |||||
Debt Instrument [Line Items] | |||||
Term loan | $ 189,100,000 | ¥ 21.3 | |||
Maturity date of term loan | Sep. 27, 2022 | Sep. 27, 2022 | |||
Interest rate | 0.635% | ||||
Estimated fair value of Senior Notes and term loan | $ 291,800,000 | ||||
Multicurrency Revolving Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Outstanding borrowings | $ 0 | ||||
Multicurrency Revolving Facility [Member] | 2016 Credit Agreement [Member] | |||||
Debt Instrument [Line Items] | |||||
Maturity date of term loan | Sep. 30, 2021 | ||||
Principal amount, unsecured credit facility | $ 1,500,000,000 | ||||
Debt instrument term | 5 years |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive Income - Changes in Components of Accumulated Other Comprehensive Income, Net of Tax (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Other Comprehensive Income Loss [Line Items] | |
Accumulated Other Comprehensive Income, Beginning Balance | $ (434) |
Accumulated Other Comprehensive Income, Ending Balance | (159.9) |
Foreign Currency Translation [Member] | |
Other Comprehensive Income Loss [Line Items] | |
Accumulated Other Comprehensive Income, Beginning Balance | (323.4) |
AOCI before reclassifications | 367.9 |
Accumulated Other Comprehensive Income, Ending Balance | 44.5 |
Unrealized (Losses) Gains on Securities [Member] | |
Other Comprehensive Income Loss [Line Items] | |
Accumulated Other Comprehensive Income, Beginning Balance | (0.1) |
Accumulated Other Comprehensive Income, Ending Balance | (0.1) |
Defined Benefit Plan Items [Member] | |
Other Comprehensive Income Loss [Line Items] | |
Accumulated Other Comprehensive Income, Beginning Balance | (142.8) |
AOCI before reclassifications | (10.1) |
Reclassifications | 5.1 |
Accumulated Other Comprehensive Income, Ending Balance | (147.8) |
Cash Flow Hedges [Member] | |
Other Comprehensive Income Loss [Line Items] | |
Accumulated Other Comprehensive Income, Beginning Balance | 32.3 |
AOCI before reclassifications | (79.4) |
Reclassifications | (9.4) |
Accumulated Other Comprehensive Income, Ending Balance | $ (56.5) |
Accumulated Other Comprehensi49
Accumulated Other Comprehensive Income - Reclassification Adjustments from Accumulated Other Comprehensive Income (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Other Comprehensive Income Loss [Line Items] | ||||
Cost of products sold | $ 500.9 | $ 479.3 | $ 1,541.5 | $ 1,760 |
Earnings before income taxes | 127.2 | 103.5 | 588.8 | 368.8 |
Provision for income taxes | 28.4 | (54.4) | 6.6 | 133.9 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | ||||
Other Comprehensive Income Loss [Line Items] | ||||
Net of tax | (5.8) | 11.7 | 4.3 | 52 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedges [Member] | ||||
Other Comprehensive Income Loss [Line Items] | ||||
Earnings before income taxes | (5.2) | 17.7 | 11.6 | 75.2 |
Provision for income taxes | (1.1) | 3.8 | 2.2 | 17.2 |
Net of tax | (4.1) | 13.9 | 9.4 | 58 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedges [Member] | Foreign Exchange Forward Contracts [Member] | ||||
Other Comprehensive Income Loss [Line Items] | ||||
Cost of products sold | (5.1) | 18.1 | 12 | 76.5 |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedges [Member] | Forward Starting Interest Rate Swaps [Member] | ||||
Other Comprehensive Income Loss [Line Items] | ||||
Interest expense | (0.1) | (0.4) | (0.4) | (1.3) |
Reclassification out of Accumulated Other Comprehensive Income [Member] | Defined Benefit Plan Items [Member] | ||||
Other Comprehensive Income Loss [Line Items] | ||||
Prior service cost | 2.6 | 1.9 | 7.7 | 5.8 |
Unrecognized actuarial (loss) | (5.4) | (5.1) | (16.2) | (15.1) |
Earnings before income taxes | (2.8) | (3.2) | (8.5) | (9.3) |
Provision for income taxes | (1.1) | (1) | (3.4) | (3.3) |
Net of tax | $ (1.7) | $ (2.2) | $ (5.1) | $ (6) |
Accumulated Other Comprehensi50
Accumulated Other Comprehensive Income - Tax Effects on Each Component of Accumulated Other Comprehensive Income Recognized in Statements of Comprehensive Income (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Foreign currency cumulative translation adjustments, Before Tax | $ 145 | $ 58.3 | $ 414.6 | $ 113.9 |
Unrealized cash flow hedge (losses) gains, Before Tax | (35.9) | (16.1) | (99) | (80.9) |
Reclassification adjustments on cash flow hedges, Before Tax | 5.2 | (17.7) | (11.6) | (75.2) |
Unrealized gains on securities, Before Tax | 0.4 | |||
Adjustments to prior service cost and unrecognized actuarial assumptions, Before Tax | 0.5 | 2.2 | (2.9) | 25.6 |
Total Other Comprehensive Income (Loss), Before Tax | 114.8 | 26.7 | 301.1 | (16.2) |
Foreign currency cumulative translation adjustments, Tax | 15.3 | 46.7 | ||
Unrealized cash flow hedge (losses) gains, Tax | (7.6) | (6.4) | (19.6) | (27.9) |
Reclassification adjustments on cash flow hedges, Tax | 1.1 | (3.8) | (2.2) | (17.2) |
Unrealized gains on securities, Tax | 0 | |||
Adjustments to prior service cost and unrecognized actuarial assumptions, Tax | 1.5 | 1 | 2.1 | 3.3 |
Total Other Comprehensive Income (Loss), Tax | 10.3 | (9.2) | 27 | (41.8) |
Foreign currency cumulative translation adjustments, net of tax | 129.7 | 58.3 | 367.9 | 113.9 |
Unrealized cash flow hedge (losses) gains, net of tax | (28.3) | (9.7) | (79.4) | (53) |
Reclassification adjustments on cash flow hedges, net of tax | 4.1 | (13.9) | (9.4) | (58) |
Unrealized gains on securities, net of tax | 0.4 | |||
Adjustments to prior service cost and unrecognized actuarial assumptions, net of tax | (1) | 1.2 | (5) | 22.3 |
Total Other Comprehensive Income | $ 104.5 | $ 35.9 | $ 274.1 | $ 25.6 |
Fair Value Measurement of Ass51
Fair Value Measurement of Assets and Liabilities - Fair Value Measurements of Assets and Liabilities (Detail) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Assets | $ 7.7 | $ 69.3 |
Contingent payments related to acquisitions | 44 | 62.8 |
Total Liabilities | 83.5 | 63.1 |
Fair Value Measurements at Reporting Date Using: Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total Assets | 7.7 | 69.3 |
Total Liabilities | 39.5 | 0.3 |
Fair Value Measurements at Reporting Date Using: Significant Unobservable Inputs (Level 3) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent payments related to acquisitions | 44 | 62.8 |
Total Liabilities | 44 | 62.8 |
Foreign Exchange Forward Contracts [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives, current and long-term | 3.9 | 65.3 |
Derivatives, current and long-term | 39.5 | 0.3 |
Foreign Exchange Forward Contracts [Member] | Fair Value Measurements at Reporting Date Using: Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives, current and long-term | 3.9 | 65.3 |
Derivatives, current and long-term | 39.5 | 0.3 |
Interest Rate Swaps [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives, current and long-term | 3.8 | 4 |
Interest Rate Swaps [Member] | Fair Value Measurements at Reporting Date Using: Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivatives, current and long-term | $ 3.8 | $ 4 |
Fair Value Measurement of Ass52
Fair Value Measurement of Assets and Liabilities - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2017USD ($) | Sep. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Contingent consideration (income) loss from adjustments | $ (1,700,000) | $ 1,500,000 | |
Contingent payments made | 13,700,000 | ||
Fair value adjustment of contingent consideration | 3,600,000 | ||
Goodwill impairment charge | 32,700,000 | ||
Goodwill | $ 10,904,900,000 | 10,904,900,000 | $ 10,643,900,000 |
Reporting units with goodwill assigned to them | 6 | ||
Office Based Technologies [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Goodwill impairment charge | $ 32,700,000 | 32,700,000 | |
Product Category Operating Segments [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Goodwill impairment charge | 32,700,000 | ||
Goodwill | 1,327,800,000 | 1,327,800,000 | $ 1,258,400,000 |
Product Category Operating Segments [Member] | Office Based Technologies [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Goodwill impairment charge | 32,700,000 | ||
Goodwill | $ 0 | $ 0 |
Derivative Instruments and He53
Derivative Instruments and Hedging Activities - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Unamortized balance of hedged instruments which will be recognized under effective interest rate method | $ 25,100,000 | $ 25,100,000 | $ 31,400,000 | ||
Forward starting interest rate swap cash flow hedge to be amortized | 27,800,000 | $ 27,800,000 | |||
Percentage of debt designated as net investment hedges | 100.00% | ||||
Amount of ineffectiveness on net investment hedges | 0 | $ 0 | |||
Expected months of hedging of inter company sales of inventory to minimize the effects of foreign exchange rate movements | 30 months | ||||
Fair value of outstanding derivative instruments, net unrealized loss deferred in accumulated other comprehensive income | (74,300,000) | $ (74,300,000) | |||
Gains on derivatives | 11,100,000 | $ 1,300,000 | 43,000,000 | $ 33,600,000 | |
Cost of Products Sold [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Fair value of outstanding derivative instruments, loss, expected to be reclassified to earnings | (29,300,000) | (29,300,000) | |||
Fair value of outstanding derivative instruments, loss, net of taxes expected to be reclassified to earnings | (24,100,000) | (24,100,000) | |||
Interest Expense [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Fair value of outstanding derivative instruments, loss, expected to be reclassified to earnings | (600,000) | (600,000) | |||
Fair value of outstanding derivative instruments, loss, net of taxes expected to be reclassified to earnings | (400,000) | (400,000) | |||
Foreign Exchange Contract [Member] | U.S. Dollars [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative notional amount, Total | 1,683,900,000 | 1,683,900,000 | |||
Foreign Exchange Contract [Member] | Swiss Francs [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative notional amount, Total | 285,000,000 | 285,000,000 | |||
Net Investment Hedging [Member] | Foreign Exchange Contract [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of losses recognized in AOCI | 41,700,000 | 127,500,000 | |||
Cash Flow Hedges [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Fair value of outstanding derivative instruments, unrealized loss net of taxes deferred in accumulated other comprehensive income | (56,600,000) | (56,600,000) | |||
Weighted Average [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Fixed rate on interest rate swaps | 0.82% | 0.82% | |||
Maximum [Member] | Foreign Exchange Contract [Member] | Nondesignated [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative notional amount, Total | 2,000,000,000 | 2,000,000,000 | |||
Minimum | Foreign Exchange Contract [Member] | Nondesignated [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative notional amount, Total | $ 1,500,000,000 | $ 1,500,000,000 | |||
U.S. Term Loan B [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Derivative notional amount, Total | $ 375,000,000 | $ 375,000,000 | |||
4.625% [Member] | Senior Notes [Member] | Due in 2019 [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Interest rate | 4.625% | 4.625% | 4.625% | ||
3.375% [Member] | Senior Notes [Member] | Due in 2021 [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Interest rate | 3.375% | 3.375% | 3.375% | ||
4.450% [Member] | Senior Notes [Member] | Due in 2045 [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Interest rate | 4.45% | 4.45% | 4.45% | ||
Hedged senior notes maturity period | 30 years |
Derivative Instruments and He54
Derivative Instruments and Hedging Activities - Derivative Instruments Designated as Fair Value Hedges (Detail) - Interest Rate Swaps [Member] - Interest Expense [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2016 | Sep. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gain (Loss) on Instrument | $ (3.8) | $ 10.1 |
Gain (Loss) on Hedged Item | $ 3.8 | $ (10.1) |
Derivative Instruments and He55
Derivative Instruments and Hedging Activities - Gross Unrealized Losses from Derivative Instruments (Detail) - Cash Flow Hedges [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | $ (35.9) | $ (16.1) | $ (99) | $ (80.9) |
Amount of Gain / (Loss) Reclassified from AOCI | (5.2) | 17.7 | 11.6 | 75.2 |
Foreign Exchange Forward Contracts [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | (35.6) | (16.1) | (98.7) | (80.9) |
Foreign Exchange Forward Contracts [Member] | Cost of Products Sold [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Reclassified from AOCI | (5.1) | 18.1 | 12 | 76.5 |
Interest Rate Swaps [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | (0.3) | (0.3) | ||
Forward Starting Interest Rate Swaps [Member] | Interest Expense [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Reclassified from AOCI | $ (0.1) | $ (0.4) | $ (0.4) | $ (1.3) |
Derivative Instruments and He56
Derivative Instruments and Hedging Activities - Derivative Instruments Not Designated as Hedging Instruments (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Nondesignated [Member] | Foreign Exchange Forward Contracts [Member] | Other Expense, Net [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
(Losses) gains from derivative instruments not designated as hedging instruments | $ (16.3) | $ (5.1) | $ (54.9) | $ (42.3) |
Derivative Instruments and He57
Derivative Instruments and Hedging Activities - Fair Value of Derivative Instruments on Gross Basis (Detail) - Designated as Hedging Instrument [Member] - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 27.1 | $ 96.8 |
Derivative Liabilities | 58.9 | 27.8 |
Foreign Exchange Forward Contracts [Member] | Other Current Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 15.9 | 57.9 |
Foreign Exchange Forward Contracts [Member] | Other Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | 7.4 | 34.9 |
Foreign Exchange Forward Contracts [Member] | Other Current Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 37.2 | 20.9 |
Foreign Exchange Forward Contracts [Member] | Other Long-term Liabilities [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liabilities | 21.7 | 6.9 |
Interest Rate Swaps [Member] | Other Assets [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Assets | $ 3.8 | $ 4 |
Derivative Instruments and He58
Derivative Instruments and Hedging Activities - Schedule of Effects of Master Netting Agreements on Condensed Consolidated Balance Sheets (Detail) - Cash Flow Hedges [Member] - USD ($) $ in Millions | Sep. 30, 2017 | Dec. 31, 2016 |
Other Current Assets [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Amount | $ 15.9 | $ 57.9 |
Offset | 13.6 | 20.6 |
Net Amount in Balance Sheet | 2.3 | 37.3 |
Other Assets [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Amount | 7.4 | 34.9 |
Offset | 5.8 | 6.8 |
Net Amount in Balance Sheet | 1.6 | 28.1 |
Other Current Liabilities [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Amount | 37.2 | 20.9 |
Offset | 13.6 | 20.6 |
Net Amount in Balance Sheet | 23.6 | 0.3 |
Other Long-term Liabilities [Member] | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Gross Amount | 21.7 | 6.9 |
Offset | 5.8 | 6.8 |
Net Amount in Balance Sheet | $ 15.9 | $ 0.1 |
Derivative Instruments and He59
Derivative Instruments and Hedging Activities - Net Investment Hedge Gains Recognized on Consolidated Statements of Comprehensive Income (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2017 | Sep. 30, 2017 | |
Net Investment Hedging [Member] | Euro Notes [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Amount of Loss Recognized in OCI | $ (41.7) | $ (127.5) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2017USD ($) | Sep. 30, 2017USD ($) | |
Income Taxes Disclosure [Line Items] | ||
Decrease in unrecognized tax benefits within the next twelve months | $ 115 | $ 115 |
Increase in unrecognized tax benefits within the next twelve months | 25 | 25 |
Biomet [Member] | ||
Income Taxes Disclosure [Line Items] | ||
Tax benefit recognized on Biomet merger related accounting | 69.7 | |
Income tax expense (benefit) | (39.8) | (128.6) |
Net income tax expense recognized related to previous periods for certain tax restructurings and product liability matters | $ 7.7 | $ 11.8 |
Retirement Benefit Plans - Comp
Retirement Benefit Plans - Components of Net Pension Expense (Detail) - U.S. and Puerto Rico [Member] - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Schedule of Expected Future Pension Benefit Payment [Line Items] | ||||
Service cost | $ 7.1 | $ 7.6 | $ 21 | $ 22.8 |
Interest cost | 4.6 | 4.7 | 13.9 | 19.3 |
Expected return on plan assets | (10.1) | (10.2) | (30.3) | (35.6) |
Curtailment gain (loss) | 0.2 | (0.4) | 0.4 | (1) |
Amortization of prior service cost | (2.6) | (1.9) | (7.7) | (5.8) |
Amortization of unrecognized actuarial loss | 5.4 | 5.1 | 16.2 | 15.1 |
Net periodic pension expense | $ 4.6 | $ 4.9 | $ 13.5 | $ 14.8 |
Retirement Benefit Plans - Addi
Retirement Benefit Plans - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2017USD ($) | |
Foreign-based Defined Benefit Plans [Member] | |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | |
Contribution towards defined benefit plans | $ 13,200,000 |
Expected contribution during remainder of year | 4,700,000 |
U.S. and Puerto Rico [Member] | |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | |
Contribution towards defined benefit plans | 0 |
Expected contribution during remainder of year | $ 0 |
Earnings Per Share - Reconcilia
Earnings Per Share - Reconciliation of Weighted Average Shares for Basic and Diluted Shares Computations (Detail) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Weighted average shares outstanding for basic net earnings per share | 202.3 | 200.1 | 201.7 | 199.9 |
Effect of dilutive stock options and other equity awards | 1.7 | 2.8 | 1.9 | 2.4 |
Weighted average shares outstanding for diluted net earnings per share | 204 | 202.9 | 203.6 | 202.3 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Options to purchase shares of common stock not included in the computation of diluted earnings per share | 0.9 | 0.1 | 0.8 | 0.5 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2017Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 7 |
Segment Information - Summary o
Segment Information - Summary of Net Sales and Operating Profit by Segment (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Net Sales and Operating Profit Information [Line Items] | ||||
Net Sales | $ 1,818.1 | $ 1,832.8 | $ 5,749.8 | $ 5,670.8 |
Operating Profit | 213.4 | 195.5 | 846.1 | 642.6 |
Intangible asset amortization | (152.7) | (164.3) | (452.4) | (424.7) |
Special items | (165.4) | (170.4) | (434.1) | (397) |
Operating Segments [Member] | Americas [Member] | ||||
Net Sales and Operating Profit Information [Line Items] | ||||
Net Sales | 921.2 | 946.6 | 2,900 | 2,909.6 |
Operating Profit | 502.3 | 515.6 | 1,568.8 | 1,574.1 |
Operating Segments [Member] | EMEA [Member] | ||||
Net Sales and Operating Profit Information [Line Items] | ||||
Net Sales | 335.4 | 322.1 | 1,108.5 | 1,122.7 |
Operating Profit | 97.5 | 92.3 | 348.2 | 368 |
Operating Segments [Member] | Asia Pacific [Member] | ||||
Net Sales and Operating Profit Information [Line Items] | ||||
Net Sales | 281.7 | 274.5 | 850.5 | 806.9 |
Operating Profit | 101.5 | 106.3 | 318.5 | 331.4 |
Operating Segments [Member] | Product Category Operating Segments [Member] | ||||
Net Sales and Operating Profit Information [Line Items] | ||||
Net Sales | 279.8 | 289.6 | 890.8 | 831.6 |
Operating Profit | 51.1 | 47.5 | 197.2 | 177.1 |
Global Operations and Corporate Functions [Member] | ||||
Net Sales and Operating Profit Information [Line Items] | ||||
Global Operations and Corporate Functions | (210.5) | (208.7) | (641.6) | (628.6) |
Segment Reconciling Items [Member] | ||||
Net Sales and Operating Profit Information [Line Items] | ||||
Inventory step-up and other inventory and manufacturing related charges | (10.4) | (22.8) | (58.5) | (357.7) |
Intangible asset amortization | (152.7) | (164.3) | (452.4) | (424.7) |
Special items | $ (165.4) | $ (170.4) | $ (434.1) | $ (397) |
Segment Information - Summary67
Segment Information - Summary of Net Sales by Product Category (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | |
Revenue from External Customer [Line Items] | ||||
Net Sales | $ 1,818.1 | $ 1,832.8 | $ 5,749.8 | $ 5,670.8 |
Knees [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Net Sales | 623.7 | 631.5 | 2,005.9 | 2,031.7 |
Hips [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Net Sales | 434.5 | 440.6 | 1,380 | 1,385.7 |
S.E.T [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Net Sales | 406.6 | 401.8 | 1,254.5 | 1,215 |
Dental [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Net Sales | 92.9 | 95.9 | 311.1 | 322.5 |
Spine and CMF [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Net Sales | 184.9 | 183.7 | 565.2 | 470.7 |
Other [Member] | ||||
Revenue from External Customer [Line Items] | ||||
Net Sales | $ 75.5 | $ 79.3 | $ 233.1 | $ 245.2 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) € in Millions | Feb. 05, 2013USD ($) | Dec. 31, 2016EUR (€) | Jul. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2017USD ($)Patent | Sep. 30, 2016USD ($) | Sep. 30, 2017USD ($)Patent | Dec. 02, 2016USD ($) | Jun. 13, 2016USD ($) | Jun. 06, 2016USD ($) | Mar. 01, 2013USD ($) | Jun. 10, 2011USD ($) |
Loss Contingencies [Line Items] | ||||||||||||
Compensatory damages awarded | $ 27,600,000 | |||||||||||
Percentage of fault apportioned to plaintiffs | 30.00% | |||||||||||
Percentage of fault apportioned to company | 34.00% | |||||||||||
Percentage of fault apportioned to unrelated third party | 36.00% | |||||||||||
Verdict in full and entered judgment | $ 20,300,000 | |||||||||||
Compensatory damages vacated | $ 27,600,000 | $ 27,600,000 | ||||||||||
Verdict amount remitted | $ 21,500,000 | |||||||||||
Deferred Prosecution Agreement [Member] | ||||||||||||
Loss Contingencies [Line Items] | ||||||||||||
Estimated charges | $ 6,500,000 | |||||||||||
Civil settlement payments | 6,500,000 | |||||||||||
Criminal penalty payments outstanding | $ 17,500,000 | |||||||||||
DPA term | 3 years | |||||||||||
Durom Cup Related Claims [Member] | ||||||||||||
Loss Contingencies [Line Items] | ||||||||||||
Certain claims | $ 0 | $ 479,400,000 | ||||||||||
Co-payment requirement | 20.00% | |||||||||||
Estimated liability outstanding | $ 218,300,000 | 218,300,000 | ||||||||||
Estimated liability classified as short-term | 75,000,000 | 75,000,000 | ||||||||||
Estimated liability classified as long-term | 143,300,000 | 143,300,000 | ||||||||||
Durom Cup Related Claims [Member] | Other Assets [Member] | ||||||||||||
Loss Contingencies [Line Items] | ||||||||||||
Estimated insurance recoveries | 95,300,000 | 95,300,000 | ||||||||||
Biomet Metal On Metal Hip Implant Claims [Member] | ||||||||||||
Loss Contingencies [Line Items] | ||||||||||||
Estimated liability classified as short-term | $ 39,700,000 | $ 39,700,000 | ||||||||||
Heraeus Trade Secret Misappropriation Lawsuits [Member] | Germany [Member] | ||||||||||||
Loss Contingencies [Line Items] | ||||||||||||
Loss Contingency, Damages incurred | € | € 121.9 | |||||||||||
Stryker Corporation [Member] | ||||||||||||
Loss Contingencies [Line Items] | ||||||||||||
Number of patents infringed | Patent | 3 | 3 | ||||||||||
Monetary damages for lost profits | $ 70,000,000 | |||||||||||
Estimated charges | $ 90,300,000 | $ 70,000,000 | ||||||||||
Stryker Corporation [Member] | Maximum [Member] | ||||||||||||
Loss Contingencies [Line Items] | ||||||||||||
Estimated charges | $ 165,000,000 |