Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Nov. 30, 2017 | Jan. 04, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ACUITY BRANDS INC | |
Entity Central Index Key | 1,144,215 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 30, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --08-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 42,158,288 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Nov. 30, 2017 | Aug. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 428.6 | $ 311.1 |
Accounts receivable, less reserve for doubtful accounts of $2.0 and $1.9, respectively | 514.3 | 573.3 |
Inventories | 339.6 | 328.6 |
Prepayments and other current assets | 41.3 | 32.6 |
Total current assets | 1,323.8 | 1,245.6 |
Property, plant, and equipment, at cost: | ||
Land | 22.3 | 22.5 |
Buildings and leasehold improvements | 181.4 | 180.7 |
Machinery and equipment | 492.9 | 484.6 |
Total property, plant, and equipment | 696.6 | 687.8 |
Less — Accumulated depreciation and amortization | (410.5) | (400.1) |
Property, plant, and equipment, net | 286.1 | 287.7 |
Goodwill | 896.5 | 900.9 |
Intangible assets, net | 439.9 | 448.8 |
Deferred income taxes | 3.3 | 3.4 |
Other long-term assets | 11.8 | 13.2 |
Total assets | 2,961.4 | 2,899.6 |
Current liabilities: | ||
Accounts payable | 364.6 | 395.1 |
Current maturities of long-term debt | 0.4 | 0.4 |
Accrued compensation | 31.2 | 41.8 |
Other accrued liabilities | 198.7 | 163.6 |
Total current liabilities | 594.9 | 600.9 |
Long-term debt | 356.5 | 356.5 |
Accrued pension liabilities | 95.9 | 96.9 |
Deferred income taxes | 108.3 | 108.2 |
Self-insurance reserves | 8.6 | 7.9 |
Other long-term liabilities | 71.1 | 63.6 |
Total liabilities | 1,235.3 | 1,234 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value; 50,000,000 shares authorized; none issued | 0 | 0 |
Common stock, $0.01 par value; 500,000,000 shares authorized; 53,621,355 and 53,549,840 issued, respectively | 0.5 | 0.5 |
Paid-in capital | 884.3 | 881 |
Retained earnings | 1,725.9 | 1,659.9 |
Accumulated other comprehensive loss | (108.6) | (99.7) |
Treasury stock, at cost — 11,676,689 and 11,678,002 shares, respectively | (776) | (776.1) |
Total stockholders’ equity | 1,726.1 | 1,665.6 |
Total liabilities and stockholders’ equity | $ 2,961.4 | $ 2,899.6 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Nov. 30, 2017 | Aug. 31, 2017 |
Current assets: | ||
Allowance for doubtful accounts | $ 2 | $ 1.9 |
Stockholders’ equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (shares) | 53,621,355 | 53,549,840 |
Treasury stock, shares (shares) | 11,676,689 | 11,678,002 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Income Statement [Abstract] | ||
Net sales | $ 842.8 | $ 851.2 |
Cost of products sold | 492.6 | 491.6 |
Gross profit | 350.2 | 359.6 |
Selling, distribution, and administrative expenses | 231.4 | 231.8 |
Special charge | 0.2 | 1.2 |
Operating profit | 118.6 | 126.6 |
Other expense (income): | ||
Interest expense, net | 8.1 | 8.2 |
Miscellaneous income, net | (0.4) | (7.9) |
Total other expense | 7.7 | 0.3 |
Income before provision for income taxes | 110.9 | 126.3 |
Provision for income taxes | 39.4 | 44.6 |
Net income | $ 71.5 | $ 81.7 |
Earnings per share: | ||
Basic earnings per share (in dollars per share) | $ 1.71 | $ 1.87 |
Basic weighted average number of shares outstanding (in shares) | 41.9 | 43.8 |
Diluted earnings per share (in dollars per share) | $ 1.70 | $ 1.86 |
Diluted weighted average number of shares outstanding (in shares) | 42.1 | 44 |
Dividends declared per share (in dollars per share) | $ 0.13 | $ 0.13 |
Comprehensive income: | ||
Net income | $ 71.5 | $ 81.7 |
Other comprehensive income (loss) items: | ||
Foreign currency translation adjustments | (10.5) | (11.9) |
Defined benefit pension plans, net of tax | 1.6 | 2 |
Other comprehensive loss, net of tax | (8.9) | (9.9) |
Comprehensive income | $ 62.6 | $ 71.8 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Cash flows from operating activities: | ||
Net income | $ 71.5 | $ 81.7 |
Adjustments to reconcile net income to net cash flows from operating activities: | ||
Depreciation and amortization | 19 | 17.2 |
Share-based payment expense | 8.5 | 7.9 |
Loss on sale or disposal of property, plant, and equipment | 0.1 | 0.1 |
Gain on sale of investment in unconsolidated affiliate | 0 | (7.2) |
Deferred income taxes | (0.1) | 0 |
Change in assets and liabilities, net of effect of acquisitions, divestitures, and exchange rate changes: | ||
Accounts receivable | 57.6 | 47.6 |
Inventories | (11.1) | (40.3) |
Prepayments and other current assets | (9.3) | (10.7) |
Accounts payable | (32.5) | (7.2) |
Other current liabilities | 25.5 | (45.7) |
Other | 10.6 | 12.4 |
Net cash provided by operating activities | 139.8 | 55.8 |
Cash flows from investing activities: | ||
Purchases of property, plant, and equipment | (10.3) | (19.5) |
Proceeds from sale of property, plant, and equipment | 0 | 5.4 |
Proceeds from sale of investment in unconsolidated affiliate | 0 | 13 |
Net cash used for investing activities | (10.3) | (1.1) |
Cash flows from financing activities: | ||
Issuances of long-term debt | 0 | 0.9 |
Repayments of long-term debt | (0.1) | 0 |
Repurchases of common stock | 0 | (0.4) |
Proceeds from stock option exercises and other | 0.8 | 2.1 |
Payments for employee taxes on net settlement of equity awards | (6) | (11.3) |
Dividends paid | (5.5) | (5.8) |
Net cash used for financing activities | (10.8) | (14.5) |
Effect of exchange rate changes on cash and cash equivalents | (1.2) | (2.2) |
Net change in cash and cash equivalents | 117.5 | 38 |
Cash and cash equivalents at beginning of period | 311.1 | 413.2 |
Cash and cash equivalents at end of period | 428.6 | 451.2 |
Supplemental cash flow information: | ||
Income taxes paid during the period | 2.7 | 29 |
Interest paid during the period | $ 12.7 | $ 12.1 |
Description of Business and Bas
Description of Business and Basis of Presentation | 3 Months Ended |
Nov. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation Acuity Brands, Inc. (“Acuity Brands”) is the parent company of Acuity Brands Lighting, Inc. (“ABL”) and other subsidiaries (Acuity Brands, ABL, and such other subsidiaries are collectively referred to herein as the “Company”) and was incorporated in 2001 under the laws of the State of Delaware. The Company is one of the world’s leading providers of lighting and building management solutions and services for commercial, institutional, industrial, infrastructure, and residential applications throughout North America and select international markets. The Company’s lighting and building management solutions include devices such as luminaires, lighting controls, controllers for various building systems, power supplies, prismatic skylights, and drivers, as well as integrated systems designed to optimize energy efficiency and comfort for various indoor and outdoor applications. Additionally, the Company continues to expand its solutions portfolio to provide a host of other economic benefits, including software and services that enable the Internet of Things (“IoT”). The Company's IoT solutions provide customers with access to robust data analytics; support the advancement of smart buildings, smart cities, and the smart grid; and allow businesses to develop custom applications to scale their operations. The Company has one reportable segment serving the North American lighting market and select international markets. The Consolidated Financial Statements have been prepared by the Company in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and present the financial position, results of operations, and cash flows of Acuity Brands and its wholly-owned subsidiaries. These unaudited interim consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary to present fairly the Company’s consolidated financial position as of November 30, 2017 , the consolidated comprehensive income for the three months ended November 30, 2017 and 2016 , and the consolidated cash flows for the three months ended November 30, 2017 and 2016 . Certain information and footnote disclosures normally included in the Company’s annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. However, the Company believes that the disclosures included herein are adequate to make the information presented not misleading. These financial statements should be read in conjunction with the audited consolidated financial statements of the Company as of and for the three years ended August 31, 2017 and notes thereto included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on October 26, 2017 (File No. 001-16583) (“Form 10-K”). The results of operations for the three months ended November 30, 2017 and 2016 are not necessarily indicative of the results to be expected for the full fiscal year due primarily to seasonality, which results in the net sales and net income of the Company generally being higher in the second half of its fiscal year, the impact of any acquisitions, and, among other reasons, the continued uncertainty of general economic conditions that may impact the key end markets of the Company for the remainder of fiscal 2018 . |
Significant Accounting Policies
Significant Accounting Policies | 3 Months Ended |
Nov. 30, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Use of Estimates The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. Reclassifications Certain prior-period amounts have been reclassified to conform to the current year presentation. No material reclassifications occurred during the current period. Refer to the New Accounting Pronouncements footnote for additional information regarding retrospective reclassifications related to accounting standards adopted in the current year. |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
Nov. 30, 2017 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements | New Accounting Pronouncements Accounting Standards Adopted in Fiscal 2018 In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Improvements to Employee Share-Based Payment Accounting , (“ASU 2016-09”), which changes certain aspects of accounting for share-based payments to employees. The standard requires that all excess tax benefits and deficiencies previously recorded as additional paid-in capital be prospectively recorded in income tax expense, which could create volatility in the Company's effective income tax rate on a quarter by quarter basis due primarily to fluctuations in the Company's stock price and the timing of stock option exercises and vesting of restricted share grants. The standard also requires excess tax benefits to be presented as an operating activity on the statement of cash flows rather than as a financing activity and taxes paid for employee withholdings to be presented as a financing activity. The Company adopted ASU 2016-09 effective as of September 1, 2017. Excess tax benefits and deficiencies are recorded within Provision for income taxes within the Consolidated Statements of Comprehensive Income on a prospective basis as required by the standard; however, the Company elected to present changes to the statement of cash flows on a retrospective basis as allowed by the standard in order to maintain comparability between fiscal years. As such, cash flows from operations for three months ended November 30, 2016 increased $17.1 million , with a corresponding decrease to cash flows from financing activities, compared to amounts previously reported. Accounting Standards Yet to Be Adopted In March 2017, the FASB issued ASU No. 2017-07, Compensation — Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”), which will change the presentation of net periodic benefit cost related to employer sponsored defined benefit plans and other postretirement benefits. Service cost will be included within the same income statement line item as other compensation costs arising from services rendered during the period, while other components of net periodic benefit pension cost will be presented separately outside of operating income. Additionally, only service costs may be capitalized in assets. ASU 2017-07 is effective for fiscal years (and interim reporting periods within those years) beginning after December 15, 2017. The provisions of ASU 2017-07 are not expected to have a material effect on the Company's financial condition, results of operations, or cash flows. In January 2017, the FASB issued ASU No. 2017-01, Clarifying the Definition of a Business (“ASU 2017-01”), which requires an evaluation of whether substantially all of the fair value of assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If so, the transaction does not qualify as a business. The guidance also requires an acquired business to include at least one substantive process and narrows the definition of outputs. The Company is required to apply this guidance to annual periods beginning after December 15, 2017, including interim periods within those periods. The Company is currently evaluating the impact of the provisions of ASU 2017-01 and intends to implement the standard as required in fiscal 2019. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (“ASU 2016-15”), which is intended to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows including debt prepayment and extinguishment costs, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, and proceeds from the settlement of corporate-owned life insurance. ASU 2016-15 is effective for fiscal years (and interim reporting periods within those years) beginning after December 15, 2017. The Company intends to implement the standard as required in fiscal 2019, and the provisions of ASU 2016-15 are not expected to have a material impact on the Company's financial statement disclosures. In February 2016, the FASB issued ASU No. 2016-02, Leases (“ASU 2016-02”), which requires lessees to include most leases on the balance sheet. ASU 2016-02 is effective for fiscal years (and interim reporting periods within those years) beginning after December 15, 2018. The Company is currently evaluating the impact of the provisions of ASU 2016-02 and intends to implement the standard as required in fiscal 2020. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which will replace most existing revenue recognition guidance in U.S. GAAP. ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The standard also requires additional disclosures about the nature, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. ASU 2014-09 permits two transition methods: the full retrospective method and the modified retrospective method. Under the full retrospective method, the standard would be applied to each prior reporting period presented with the cumulative effect of applying the standard recognized at the earliest period shown. Under the modified retrospective method, the cumulative effect of applying the standard would be recognized at the date of initial application. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , which clarifies the guidance in ASU 2014-09 and has the same effective date as the original standard. During the three months ended July 1, 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing; ASU 2016-11, Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting; and ASU 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients. These amendments are intended to improve and clarify the implementation guidance of ASU 2014-09 and have the same effective date as the original standard. The Company has an implementation team tasked with identifying potential differences that will result from applying the new revenue recognition standard to the Company's contracts with its customers. The implementation team reports the findings and progress of the project to management on a frequent basis and to the Audit Committee of the Board of Directors on a quarterly basis. The implementation team has completed its initial phase of contract reviews and continues to evaluate the results of those reviews with respect to potential changes from adopting the new standard on the Company's consolidated financial statements. Management anticipates the most significant changes will relate to additional deferral of revenue recognition for certain services provided and the gross presentation of right of return assets and refund liabilities for sales with a right of return. Based on the current portfolio of the Company's revenue generating activities, these changes are not expected to have a material impact on the Company's consolidated financial condition, results of operations, or cash flows. Additionally, the implementation team is in the process of identifying appropriate changes to the Company's business processes, systems, and controls to support recognition and disclosure under the new standard. Based on the implementation team's current findings and the overall expected immaterial impact of adoption, the implementation team is currently evaluating which adoption method would provide the most meaningful information to the Company's stakeholders. The Company will adopt the requirements of the new standard no later than the effective date of September 1, 2018. All other newly issued accounting pronouncements not yet effective have been deemed either immaterial or not applicable. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Nov. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company determines fair value measurements based on the assumptions a market participant would use in pricing an asset or liability. Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), establishes a three level hierarchy making a distinction between market participant assumptions based on (i) unadjusted quoted prices for identical assets or liabilities in an active market (Level 1), (ii) quoted prices in markets that are not active or inputs that are observable either directly or indirectly for substantially the full term of the asset or liability (Level 2), and (iii) prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement (Level 3). The Company's cash and cash equivalents (Level 1), which are required to be carried at fair value and measured on a recurring basis, were $428.6 million and $311.1 million as of November 30, 2017 and August 31, 2017 , respectively. The Company utilizes valuation methodologies to determine the fair values of its financial assets and liabilities in conformity with the concepts of “exit price” and the fair value hierarchy as prescribed in ASC 820. All valuation methods and assumptions are validated at least quarterly to ensure the accuracy and relevance of the fair values. There were no material changes to the valuation methods or assumptions used to determine fair values during the current period. The Company used quoted market prices to determine the fair value of Level 1 assets and liabilities. No transfers between the levels of the fair value hierarchy occurred during the current fiscal period. In the event of a transfer in or out of a level within the fair value hierarchy, the transfers would be recognized on the date of occurrence. Disclosures of fair value information about financial instruments (whether or not recognized in the balance sheet), for which it is practicable to estimate that value, are required each reporting period in addition to any financial instruments carried at fair value on a recurring basis as prescribed by ASC Topic 825, Financial Instruments (“ASC 825”). In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. The carrying values and estimated fair values of certain of the Company’s financial instruments were as follows at November 30, 2017 and August 31, 2017 (in millions): November 30, 2017 August 31, 2017 Carrying Value Fair Value Carrying Value Fair Value Senior unsecured public notes, net of unamortized discount and deferred costs $ 349.2 $ 374.1 $ 349.1 $ 379.7 Industrial revenue bond 4.0 4.0 4.0 4.0 Bank loans 3.7 3.7 3.8 3.8 The senior unsecured public notes are carried at the outstanding balance, net of unamortized bond discount and deferred costs, as of the end of the reporting period. Fair value is estimated based on discounted future cash flows using rates currently available for debt of similar terms and maturity (Level 2). The industrial revenue bond is carried at the outstanding balance as of the end of the reporting period. The industrial revenue bond is a tax-exempt, variable-rate instrument that resets on a weekly basis; therefore, the Company estimates that the face amount of the bond approximates fair value as of November 30, 2017 based on bonds of similar terms and maturity (Level 2). The bank loans are carried at the outstanding balance as of the end of the reporting period. Fair value is estimated based on discounted future cash flows using rates currently available for debt of similar terms and maturity (Level 2). ASC 825 excludes certain financial instruments and all nonfinancial instruments from its disclosure requirements. Accordingly, the aggregate fair value amounts presented do not represent the underlying value to the Company. In many cases, the fair value estimates cannot be substantiated by comparison to independent markets, nor can the disclosed value be realized in immediate settlement of the instruments. In evaluating the Company’s management of liquidity and other risks, the fair values of all assets and liabilities should be taken into consideration, not only those presented above. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Nov. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Through multiple acquisitions, the Company acquired intangible assets consisting primarily of trademarks and trade names associated with specific products with finite lives, definite-lived distribution networks, patented technology, non-compete agreements, and customer relationships, which are amortized over their estimated useful lives. Indefinite-lived intangible assets consist of trade names that are expected to generate cash flows indefinitely. The Company recorded amortization expense of $6.6 million and $5.9 million during the three months ended November 30, 2017 and 2016 , respectively. Amortization expense is generally recorded on a straight-line basis and is expected to be approximately $26.2 million in fiscal 2018 , $26.1 million in fiscal 2019 , $25.8 million in fiscal 2020 , $23.0 million in fiscal 2021 , and $21.2 million in fiscal 2022 . The change in the carrying amount of goodwill during the three months ended November 30, 2017 is summarized below (in millions): Balance at August 31, 2017 $ 900.9 Foreign currency translation adjustments (4.4 ) Balance at November 30, 2017 $ 896.5 Further discussion of the Company’s goodwill and other intangible assets is included within the Significant Accounting Policies footnote of the Notes to Consolidated Financial Statements within the Company’s Form 10-K. |
Inventories
Inventories | 3 Months Ended |
Nov. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories include materials, labor, in-bound freight, and related manufacturing overhead, are stated at the lower of cost (on a first-in, first-out or average cost basis) or market, and consist of the following (in millions): November 30, 2017 August 31, 2017 Raw materials, supplies, and work in process (1) $ 176.4 $ 176.5 Finished goods 193.1 180.8 Inventories excluding reserves 369.5 357.3 Less: Reserves (29.9 ) (28.7 ) Total inventories $ 339.6 $ 328.6 _______________________________________ (1) Due to the immaterial amount of estimated work in process and the short lead times for the conversion of raw materials to finished goods, the Company does not believe the segregation of raw materials and work in process is meaningful information. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Nov. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings Per Share Basic earnings per share for the periods presented is computed by dividing net earnings available to common stockholders by the weighted average number of common shares outstanding. Diluted earnings per share is computed similarly but reflects the potential dilution that would occur if dilutive options were exercised, all unvested share-based payment awards were vested, and other distributions related to deferred stock agreements were incurred. The following table calculates basic earnings per common share and diluted earnings per common share for the three months ended November 30, 2017 and 2016 (in millions, except per share data): Three Months Ended November 30, 2017 November 30, 2016 Net income $ 71.5 $ 81.7 Basic weighted average shares outstanding 41.9 43.8 Common stock equivalents 0.2 0.2 Diluted weighted average shares outstanding 42.1 44.0 Basic earnings per share $ 1.71 $ 1.87 Diluted earnings per share $ 1.70 $ 1.86 The following table presents stock options and restricted stock awards that were excluded from the diluted earnings per share calculation for the three months ended November 30, 2017 and 2016 as the effect of inclusion would have been antidilutive: Three Months Ended November 30, 2017 November 30, 2016 Stock options 163,812 81,487 Restricted stock awards 211,576 25,994 Further discussion of the Company’s stock options and restricted stock awards is included within the Common Stock and Related Matters and Share-based Payments footnotes of the Notes to Consolidated Financial Statements within the Company’s Form 10-K. |
Comprehensive Income
Comprehensive Income | 3 Months Ended |
Nov. 30, 2017 | |
Equity [Abstract] | |
Comprehensive Income | Comprehensive Income Comprehensive income represents a measure of all changes in equity that result from recognized transactions and other economic events other than transactions with owners in their capacity as owners. Other comprehensive income (loss) for the Company includes foreign currency translation and pension adjustments. The following table presents the changes in each component of accumulated other comprehensive income (loss) during the three months ended November 30, 2017 (in millions): Foreign Currency Items Defined Benefit Pension Plans Accumulated Other Comprehensive Loss Items Balance at August 31, 2017 $ (28.7 ) $ (71.0 ) $ (99.7 ) Other comprehensive loss before reclassifications (10.5 ) — (10.5 ) Amounts reclassified from accumulated other comprehensive income — 1.6 1.6 Net current period other comprehensive (loss) income (10.5 ) 1.6 (8.9 ) Balance at November 30, 2017 $ (39.2 ) $ (69.4 ) $ (108.6 ) The following table presents the tax expense or benefit allocated to each component of other comprehensive income (loss) for the three months ended November 30, 2017 and 2016 (in millions): Three Months Ended November 30, 2017 November 30, 2016 Before Tax Amount Tax (Expense) Benefit Net of Tax Amount Before Tax Amount Tax (Expense) Benefit Net of Tax Amount Foreign currency translation adjustments $ (10.5 ) $ — $ (10.5 ) $ (11.9 ) $ — $ (11.9 ) Defined benefit pension plans: Amortization of defined benefit pension items: Prior service cost (1) 0.8 (0.3 ) 0.5 0.8 (0.3 ) 0.5 Actuarial losses (1) 1.7 (0.6 ) 1.1 2.2 (0.7 ) 1.5 Total defined benefit pension plans, net 2.5 (0.9 ) 1.6 3.0 (1.0 ) 2.0 Other comprehensive loss $ (8.0 ) $ (0.9 ) $ (8.9 ) $ (8.9 ) $ (1.0 ) $ (9.9 ) _______________________________________ (1) The before tax amount of these other comprehensive income (loss) components is included in net periodic pension cost. See Pension Plans footnote within the Notes to Consolidated Financial Statements for additional details. |
Debt
Debt | 3 Months Ended |
Nov. 30, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Debt Lines of Credit On August 27, 2014, the Company executed a $250.0 million revolving credit facility (the “Revolving Credit Facility”). The Revolving Credit Facility will mature, and all amounts outstanding will be due and payable, on August 27, 2019 . Generally, amounts outstanding under the Revolving Credit Facility bear interest at a Eurocurrency Rate. Eurocurrency Rate advances can be denominated in a variety of currencies, including U.S. Dollars, and amounts outstanding bear interest at a periodic fixed rate equal to the London Inter Bank Offered Rate (“LIBOR”) for the applicable currency plus a margin as determined by the Company's leverage ratio (“Applicable Margin”). The Applicable Margin is based on the Company’s leverage ratio, as defined in the Revolving Credit Facility, with such margin ranging from 1.000% to 1.575% . The Company had no borrowings outstanding under the Revolving Credit Facility as of November 30, 2017 . Additionally, the Company is required to pay certain fees in connection with the Revolving Credit Facility, including administrative service fees and an annual facility fee. The annual facility fee is payable quarterly, in arrears, and is determined by the Company’s leverage ratio as defined in the Revolving Credit Facility. This facility fee ranges from 0.125% to 0.300% of the aggregate $250.0 million commitment of the lenders under the Revolving Credit Facility. The Revolving Credit Facility contains financial covenants, including a minimum interest coverage ratio (“Minimum Interest Coverage Ratio”) and a leverage ratio (“Maximum Leverage Ratio”) of total indebtedness to earnings before interest, taxes, depreciation, and amortization expense (“EBITDA”), as such terms are defined in the Revolving Credit Facility agreement. These ratios are computed at the end of each fiscal quarter for the most recent 12-month period. The Revolving Credit Facility allows for a Minimum Interest Coverage Ratio of 2.50 and a Maximum Leverage Ratio of 3.50 , subject to certain conditions defined in the financing agreement. As of November 30, 2017 , the Company was in compliance with all financial covenants under the Revolving Credit Facility. As of November 30, 2017 , the Company had outstanding letters of credit totaling $10.2 million , primarily for securing collateral requirements under the Company's casualty insurance programs and for providing credit support for the Company’s industrial revenue bond (not an outstanding amount under the Revolving Credit Facility). At November 30, 2017 , the Company had additional borrowing capacity under the Revolving Credit Facility of $244.7 million under the most restrictive covenant in effect at the time, which represents the full amount of the Revolving Credit Facility less outstanding letters of credit of $5.3 million issued under the Revolving Credit Facility. Long-term Debt At November 30, 2017 , the Company had $350.0 million of publicly-traded, senior unsecured notes outstanding at a 6% interest rate that are scheduled to mature in December 2019 (the “Unsecured Notes”) and $4.0 million of tax-exempt industrial revenue bonds that are scheduled to mature in 2021 . The Company also had $3.7 million outstanding under fixed-rate bank loans. Further discussion of the Company's long-term debt is included within the Debt and Lines of Credit footnote of the Notes to Consolidated Financial Statements within the Company’s Form 10-K. Interest Expense, net Interest expense, net, is comprised primarily of interest expense on long-term debt, obligations in connection with non-qualified retirement benefits, and Revolving Credit Facility borrowings, partially offset by interest income earned on cash and cash equivalents. The following table summarizes the components of interest expense, net for the three months ended November 30, 2017 and 2016 (in millions): Three Months Ended November 30, 2017 November 30, 2016 Interest expense $ 8.7 $ 8.6 Interest income (0.6 ) (0.4 ) Interest expense, net $ 8.1 $ 8.2 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Nov. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies In the normal course of business, the Company is subject to the effects of certain contractual stipulations, events, transactions, and laws and regulations that may, at times, require the recognition of liabilities, such as those related to self-insurance reserves and claims, legal and contractual issues, environmental laws and regulations, guarantees, and indemnities. The Company establishes reserves when the associated costs related to uncertainties or guarantees become probable and can be reasonably estimated. For the period ended November 30, 2017 , no material changes have occurred in the Company's reserves for self-insurance, litigation, environmental matters, guarantees and indemnities, or relevant events and circumstances, from those disclosed in the Commitments and Contingencies footnote of the Notes to Consolidated Financial Statements within the Company's Form 10-K. Trade Compliance Matters In the course of routine reviews of import and export activity, the Company determined that it misclassified and/or inaccurately valued certain international shipments of products. The Company is conducting a detailed review of this activity to determine the extent of any liabilities and the appropriate remedial measures. At this time, the Company is unable to determine the likelihood or amount of any loss associated with these shipments. Product Warranty and Recall Costs The Company's products generally have a standard warranty term of five years. The Company records an allowance for the estimated amount of future warranty costs when the related revenue is recognized. Estimated costs related to product recalls based on a formal campaign soliciting repair or return of that product are accrued when they are deemed to be probable and can be reasonably estimated. Estimated future warranty and recall costs are primarily based on historical experience of identified warranty and recall claims. In certain limited cases, the Company has warranty arrangements for terms that exceed the standard term. Given that these longer-term warranties are not included in the Company’s historical experience, the Company utilizes estimated failure rates from industry sources to determine the potential future warranty cost. However, there can be no assurance that future warranty or recall costs will not exceed historical amounts or that new technology products, which may include extended warranties, may not generate unexpected costs. If actual future warranty or recall costs exceed historical amounts, additional allowances may be required, which could have a material adverse impact on the Company’s results of operations and cash flows. Reserves for product warranty and recall costs are included in Other accrued liabilities and Other long-term liabilities on the Consolidated Balance Sheets. The changes in the reserves for product warranty and recall costs during the three months ended November 30, 2017 and 2016 are summarized as follows (in millions): Three Months Ended November 30, 2017 November 30, 2016 Beginning balance $ 22.0 $ 15.5 Warranty and recall costs 8.6 9.2 Payments and other deductions (6.7 ) (7.2 ) Ending balance $ 23.9 $ 17.5 Securities Class Action On January 3, 2018, a shareholder filed a class action complaint in the United States District Court for the District of Delaware against the Company and certain of its officers on behalf of all persons who purchased or otherwise acquired the Company’s stock between June 29, 2016 and April 3, 2017. The complaint alleges that the defendants violated the federal securities laws by making false or misleading statements and/or omitting to disclose material adverse facts that (i) concealed known trends negatively impacting sales of the Company’s products and (ii) overstated the Company’s ability to achieve profitable sales growth. The plaintiff seeks class certification, unspecified monetary damages, costs, and attorneys’ fees. The Company disputes the allegations in the complaint and intends to vigorously defend against the claims. Estimating an amount or range of possible losses resulting from litigation proceedings is inherently difficult, particularly where the matters involve indeterminate claims for monetary damages and are in the stages of the proceedings where key factual and legal issues have not been resolved. For these reasons, the Company is currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting from the matter described above. Other Litigation The Company is subject to various other legal claims arising in the normal course of business, including patent infringement, employment matters, and product liability claims. Based on information currently available, it is the opinion of management that the ultimate resolution of any such pending and threatened legal proceedings will not have a material adverse effect on the financial condition, results of operations, or cash flows of the Company. However, in the event of unexpected future developments, it is possible that the ultimate resolution of any such matters, if unfavorable, could have a material adverse effect on the financial condition, results of operations, or cash flows of the Company in future periods. The Company establishes reserves for legal claims when associated costs become probable and can be reasonably estimated. The actual costs of resolving legal claims may be substantially higher than the amounts reserved for such claims. However, the Company cannot make a meaningful estimate of actual costs to be incurred that could possibly be higher or lower than the amounts reserved. |
Share-based Payments
Share-based Payments | 3 Months Ended |
Nov. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Payments | Share-based Payments The Company accounts for share-based payments through the measurement and recognition of compensation expense for share-based payment awards made to employees and directors of the Company, including stock options and restricted shares (all part of the Company's equity incentive plan), and share units representing certain deferrals into the Company's director deferred compensation plan or the Company's supplemental deferred savings plan. The following table presents share-based payment expense and new shares issued upon exercise of stock options for the three months ended November 30, 2017 and 2016 (in millions, except shares): Three Months Ended November 30, 2017 November 30, 2016 Share-based payment expense $ 8.5 $ 7.9 Shares issued from option exercises 6,156 12,030 Further details regarding each of these award programs and the Company's share-based payments are included within the Share-based Payments footnote of the Notes to Consolidated Financial Statements within the Company’s Form 10-K. |
Pension Plans
Pension Plans | 3 Months Ended |
Nov. 30, 2017 | |
Retirement Benefits [Abstract] | |
Pension Plans | Pension Plans The Company has several pension plans, both qualified and non-qualified, covering certain hourly and salaried employees. Benefits paid under these plans are based generally on employees’ years of service and/or compensation during the final years of employment. Plan assets are invested primarily in equity and fixed income securities. Net periodic pension cost for the Company’s defined benefit pension plans during the three months ended November 30, 2017 and 2016 included the following components before tax (in millions): Three Months Ended November 30, 2017 November 30, 2016 Service cost $ 0.7 $ 0.9 Interest cost 2.2 2.0 Expected return on plan assets (3.1 ) (2.8 ) Amortization of prior service cost 0.8 0.8 Recognized actuarial loss 1.7 2.2 Net periodic pension cost $ 2.3 $ 3.1 Further details regarding the Company's pension plans are included within the Pension and Defined Contribution Plans footnote of the Notes to Consolidated Financial Statements within the Company’s Form 10-K. |
Special Charge
Special Charge | 3 Months Ended |
Nov. 30, 2017 | |
Restructuring and Related Activities [Abstract] | |
Special Charge | Special Charge During fiscal 2017 , the Company recognized pre-tax special charges consisting primarily of severance and employee-related benefit costs for the elimination of certain operations and positions following a realignment of the Company's operating structure, including positions within various selling, distribution, and administrative (“SD&A”) departments. During fiscal 2016 , the Company recognized pre-tax special charges primarily related to the Company's continued efforts to integrate recent acquisitions and to streamline the organization by realigning certain responsibilities primarily within various SD&A departments, as well as the consolidation of certain production activities. The Company expects that actions to streamline its business activities taken in previous fiscal years will allow it to reduce spending in certain areas while permitting continued investment in future growth initiatives, such as new products, expanded market presence, and technology and innovation. The Company did not initiate any such actions during the first quarter of fiscal 2018. The details of the special charge during the three months ended November 30, 2017 and 2016 are summarized as follows (in millions): Three Months Ended November 30, 2017 November 30, 2016 Severance and employee-related costs $ 0.2 $ (0.2 ) Lease termination and other costs — 1.4 Total special charges $ 0.2 $ 1.2 As of November 30, 2017 , remaining restructuring reserves were $10.2 million and are included in Accrued compensation and Other long-term liabilities on the Consolidated Balance Sheets . The changes in the reserves related to these programs during the three months ended November 30, 2017 are summarized as follows (in millions): Fiscal 2017 Actions Fiscal 2016 Actions Total Balance at August 31, 2017 $ 11.2 $ 1.4 $ 12.6 Severance costs 0.2 — 0.2 Payments made during the period (2.1 ) (0.5 ) (2.6 ) Balance at November 30, 2017 $ 9.3 $ 0.9 $ 10.2 |
Subsequent Events
Subsequent Events | 3 Months Ended |
Nov. 30, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On December 22, 2017, the President of the U.S. signed into law the Tax Cuts and Jobs Act (H.R. 1) (the “Act”), which is expected to have a materially favorable impact to the Company's net income, cash flows, and diluted earnings per share in future periods. The Act reduces the federal corporate tax rate from 35% to 21% effective January 1, 2018. Additionally, the Company will be required to evaluate the Act's impact on certain discrete items, including the remeasurement of the Company's net deferred tax liabilities and the taxation of the Company's accumulated unremitted foreign earnings. The Company is currently reviewing the components of the Act and evaluating its impact on its financial position, operations, and future cash flows. |
Supplemental Guarantor Condense
Supplemental Guarantor Condensed Consolidating Financial Statements | 3 Months Ended |
Nov. 30, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Supplemental Guarantor Condensed Consolidating Financial Statements | Supplemental Guarantor Condensed Consolidating Financial Statements In December 2009, ABL, the 100% owned and principal operating subsidiary of Acuity Brands, refinanced the then current outstanding debt through the issuance of the Notes. See Debt and Lines of Credit footnote for further information. In accordance with the registration rights agreement by and between ABL and the guarantors to the Notes and the initial purchasers of the Notes, ABL and the guarantors to the Notes filed a registration statement with the SEC for an offer to exchange the Notes for an issue of SEC-registered notes with identical terms. Due to the filing of the registration statement and offer to exchange, the Company determined the need for compliance with Rule 3-10 of SEC Regulation S-X (“Rule 3-10”). In lieu of providing separate audited financial statements for ABL and ABL IP Holding, the Company has included the accompanying Condensed Consolidating Financial Statements in accordance with Rule 3-10(d) of SEC Regulation S-X since the Notes are fully and unconditionally guaranteed by Acuity Brands and ABL IP Holding. The column marked “Parent” represents the financial condition, results of operations, and cash flows of Acuity Brands. The column marked “Subsidiary Issuer” represents the financial condition, results of operations, and cash flows of ABL. The column entitled “Subsidiary Guarantor” represents the financial condition, results of operations, and cash flows of ABL IP Holding. Lastly, the column listed as “Non-Guarantors” includes the financial condition, results of operations, and cash flows of the non-guarantor direct and indirect subsidiaries of Acuity Brands, which consist primarily of foreign subsidiaries. Consolidating adjustments were necessary in order to arrive at consolidated amounts. In addition, the equity method of accounting was used to calculate investments in subsidiaries. Accordingly, this basis of presentation is not intended to present the Company's financial condition, results of operations, or cash flows for any purpose other than to comply with the specific requirements for parent-subsidiary guarantor reporting. CONDENSED CONSOLIDATING BALANCE SHEETS (In millions) November 30, 2017 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated ASSETS Current assets: Cash and cash equivalents $ 364.8 $ — $ — $ 63.8 $ — $ 428.6 Accounts receivable, net — 443.5 — 70.8 — 514.3 Inventories — 314.5 — 25.1 — 339.6 Other current assets 11.0 14.8 — 15.5 — 41.3 Total current assets 375.8 772.8 — 175.2 — 1,323.8 Property, plant, and equipment, net 0.3 227.0 — 58.8 — 286.1 Goodwill — 677.5 2.7 216.3 — 896.5 Intangible assets, net — 232.5 108.9 98.5 — 439.9 Deferred income taxes 51.5 — — 7.9 (56.1 ) 3.3 Other long-term assets 0.2 9.3 — 2.3 — 11.8 Investments in and amounts due from affiliates 1,469.7 459.4 244.0 — (2,173.1 ) — Total assets $ 1,897.5 $ 2,378.5 $ 355.6 $ 559.0 $ (2,229.2 ) $ 2,961.4 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 0.3 $ 340.5 $ — $ 23.8 $ — $ 364.6 Current maturities of long-term debt — — — 0.4 — 0.4 Other accrued liabilities 65.5 126.1 — 38.3 — 229.9 Total current liabilities 65.8 466.6 — 62.5 — 594.9 Long-term debt — 353.2 — 3.3 — 356.5 Deferred income taxes — 134.6 — 29.8 (56.1 ) 108.3 Other long-term liabilities 105.6 49.7 — 20.3 — 175.6 Amounts due to affiliates — — — 117.4 (117.4 ) — Total stockholders’ equity 1,726.1 1,374.4 355.6 325.7 (2,055.7 ) 1,726.1 Total liabilities and stockholders’ equity $ 1,897.5 $ 2,378.5 $ 355.6 $ 559.0 $ (2,229.2 ) $ 2,961.4 CONDENSED CONSOLIDATING BALANCE SHEETS (In millions) August 31, 2017 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated ASSETS Current assets: Cash and cash equivalents $ 237.7 $ — $ — $ 73.4 $ — $ 311.1 Accounts receivable, net — 494.6 — 78.7 — 573.3 Inventories — 305.5 — 23.1 — 328.6 Other current assets 1.6 15.8 — 15.2 — 32.6 Total current assets 239.3 815.9 — 190.4 — 1,245.6 Property, plant, and equipment, net 0.2 228.3 — 59.2 — 287.7 Goodwill — 677.7 2.7 220.5 — 900.9 Intangible assets, net — 235.5 109.8 103.5 — 448.8 Deferred income taxes 51.6 — — 8.0 (56.2 ) 3.4 Other long-term assets 1.5 10.9 — 0.8 — 13.2 Investments in and amounts due from affiliates 1,500.3 330.4 234.2 — (2,064.9 ) — Total assets $ 1,792.9 $ 2,298.7 $ 346.7 $ 582.4 $ (2,121.1 ) $ 2,899.6 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 0.9 $ 366.4 $ — $ 27.8 $ — $ 395.1 Current maturities of long-term debt — — — 0.4 — 0.4 Other accrued liabilities 27.6 138.9 — 38.9 — 205.4 Total current liabilities 28.5 505.3 — 67.1 — 600.9 Long-term debt — 353.1 — 3.4 — 356.5 Deferred income taxes — 134.6 — 29.8 (56.2 ) 108.2 Other long-term liabilities 98.7 49.3 — 20.4 — 168.4 Amounts due to affiliates — — — 128.8 (128.8 ) — Total stockholders’ equity 1,665.7 1,256.4 346.7 332.9 (1,936.1 ) 1,665.6 Total liabilities and stockholders’ equity $ 1,792.9 $ 2,298.7 $ 346.7 $ 582.4 $ (2,121.1 ) $ 2,899.6 CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (In millions) Three Months Ended November 30, 2017 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated Net sales: External sales $ — $ 744.2 $ — $ 98.6 $ — $ 842.8 Intercompany sales — — 12.0 43.5 (55.5 ) — Total sales — 744.2 12.0 142.1 (55.5 ) 842.8 Cost of products sold — 429.8 — 104.9 (42.1 ) 492.6 Gross profit — 314.4 12.0 37.2 (13.4 ) 350.2 Selling, distribution, and administrative expenses 12.7 194.7 0.8 36.6 (13.4 ) 231.4 Intercompany charges (1.0 ) (0.5 ) — 1.5 — — Special charge — 0.2 — — — 0.2 Operating (loss) profit (11.7 ) 120.0 11.2 (0.9 ) — 118.6 Interest expense, net 2.7 4.0 — 1.4 — 8.1 Equity earnings in subsidiaries (80.9 ) (1.1 ) — — 82.0 — Miscellaneous expense (income), net — 0.8 — (1.2 ) — (0.4 ) Income (loss) before provision for income taxes 66.5 116.3 11.2 (1.1 ) (82.0 ) 110.9 (Benefit) provision for income taxes (5.0 ) 42.2 2.2 — — 39.4 Net income (loss) 71.5 74.1 9.0 (1.1 ) (82.0 ) 71.5 Other comprehensive income (loss) items: Foreign currency translation adjustments (10.5 ) (10.5 ) — — 10.5 (10.5 ) Defined benefit pension plans, net 1.6 1.2 — 0.4 (1.6 ) 1.6 Other comprehensive (loss) income items, net of tax (8.9 ) (9.3 ) — 0.4 8.9 (8.9 ) Comprehensive income (loss) $ 62.6 $ 64.8 $ 9.0 $ (0.7 ) $ (73.1 ) $ 62.6 CONDENSED CONSOL IDATING STATEMENTS OF COMPREHENSIVE INCOME (In millions) Three Months Ended November 30, 2016 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated Net sales: External sales $ — $ 746.3 $ — $ 104.9 $ — $ 851.2 Intercompany sales — — 11.5 51.6 (63.1 ) — Total sales — 746.3 11.5 156.5 (63.1 ) 851.2 Cost of products sold — 426.9 — 114.9 (50.2 ) 491.6 Gross profit — 319.4 11.5 41.6 (12.9 ) 359.6 Selling, distribution, and administrative expenses 11.8 199.9 0.9 32.1 (12.9 ) 231.8 Intercompany charges (1.2 ) 0.2 — 1.0 — — Special charge — 1.2 — — — 1.2 Operating (loss) profit (10.6 ) 118.1 10.6 8.5 — 126.6 Interest expense, net 2.8 4.0 — 1.4 — 8.2 Equity earnings in subsidiaries (90.4 ) (9.1 ) — 0.2 99.3 — Miscellaneous income, net — (7.3 ) — (0.6 ) — (7.9 ) Income before provision for income taxes 77.0 130.5 10.6 7.5 (99.3 ) 126.3 (Benefit) provision for income taxes (4.7 ) 47.8 0.9 0.6 — 44.6 Net income 81.7 82.7 9.7 6.9 (99.3 ) 81.7 Other comprehensive income (loss) items: Foreign currency translation adjustments (11.9 ) (11.9 ) — — 11.9 (11.9 ) Defined benefit pension plans, net 2.0 0.7 — 0.7 (1.4 ) 2.0 Other comprehensive (loss) income items, net of tax (9.9 ) (11.2 ) — 0.7 10.5 (9.9 ) Comprehensive income $ 71.8 $ 71.5 $ 9.7 $ 7.6 $ (88.8 ) $ 71.8 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (In millions) Three Months Ended November 30, 2017 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated Net cash provided by operating activities $ 137.8 $ 5.8 $ — $ (3.8 ) $ — $ 139.8 Cash flows from investing activities: Purchases of property, plant, and equipment — (7.2 ) — (3.1 ) — (10.3 ) Net cash used for investing activities — (7.2 ) — (3.1 ) — (10.3 ) Cash flows from financing activities: Repayments of long-term debt — — — (0.1 ) — (0.1 ) Proceeds from stock option exercises and other 0.8 — — — — 0.8 Employee taxes on net settlement of equity awards (6.0 ) — — — — (6.0 ) Dividends paid (5.5 ) — — — — (5.5 ) Net cash used for financing activities (10.7 ) — — (0.1 ) — (10.8 ) Effect of exchange rates changes on cash — 1.4 — (2.6 ) — (1.2 ) Net change in cash and cash equivalents 127.1 — — (9.6 ) — 117.5 Cash and cash equivalents at beginning of period 237.7 — — 73.4 — 311.1 Cash and cash equivalents at end of period $ 364.8 $ — $ — $ 63.8 $ — $ 428.6 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (In millions) Three Months Ended November 30, 2016 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated Net cash provided by operating activities $ 36.5 $ 2.2 $ — $ 17.1 $ — $ 55.8 Cash flows from investing activities: Purchases of property, plant, and equipment — (16.5 ) — (3.0 ) — (19.5 ) Proceeds from sale of property, plant, and equipment — — — 5.4 — 5.4 Proceeds from sale of investment — 13.0 — — — 13.0 Net cash (used for) provided by investing activities — (3.5 ) — 2.4 — (1.1 ) Cash flows from financing activities: Issuance of long-term debt — — — 0.9 — 0.9 Proceeds from stock option exercises and other 2.1 — — — — 2.1 Repurchases of common stock (0.4 ) — — — — (0.4 ) Employee taxes on net settlement of equity awards (11.3 ) — — — — (11.3 ) Dividends paid (5.8 ) — — — — (5.8 ) Net cash (used for) provided by financing activities (15.4 ) — — 0.9 — (14.5 ) Effect of exchange rate changes on cash — 1.3 — (3.5 ) — (2.2 ) Net change in cash and cash equivalents 21.1 — — 16.9 — 38.0 Cash and cash equivalents at beginning of period 368.2 — — 45.0 — 413.2 Cash and cash equivalents at end of period $ 389.3 $ — $ — $ 61.9 $ — $ 451.2 |
Significant Accounting Polici21
Significant Accounting Policies (Policies) | 3 Months Ended |
Nov. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Accounting | The Consolidated Financial Statements have been prepared by the Company in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and present the financial position, results of operations, and cash flows of Acuity Brands and its wholly-owned subsidiaries. |
Use of Estimates | Use of Estimates The preparation of financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. |
Reclassifications | Reclassifications Certain prior-period amounts have been reclassified to conform to the current year presentation. No material reclassifications occurred during the current period. |
New Accounting Pronouncements | New Accounting Pronouncements Accounting Standards Adopted in Fiscal 2018 In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-09, Improvements to Employee Share-Based Payment Accounting , (“ASU 2016-09”), which changes certain aspects of accounting for share-based payments to employees. The standard requires that all excess tax benefits and deficiencies previously recorded as additional paid-in capital be prospectively recorded in income tax expense, which could create volatility in the Company's effective income tax rate on a quarter by quarter basis due primarily to fluctuations in the Company's stock price and the timing of stock option exercises and vesting of restricted share grants. The standard also requires excess tax benefits to be presented as an operating activity on the statement of cash flows rather than as a financing activity and taxes paid for employee withholdings to be presented as a financing activity. The Company adopted ASU 2016-09 effective as of September 1, 2017. Excess tax benefits and deficiencies are recorded within Provision for income taxes within the Consolidated Statements of Comprehensive Income on a prospective basis as required by the standard; however, the Company elected to present changes to the statement of cash flows on a retrospective basis as allowed by the standard in order to maintain comparability between fiscal years. As such, cash flows from operations for three months ended November 30, 2016 increased $17.1 million , with a corresponding decrease to cash flows from financing activities, compared to amounts previously reported. Accounting Standards Yet to Be Adopted In March 2017, the FASB issued ASU No. 2017-07, Compensation — Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”), which will change the presentation of net periodic benefit cost related to employer sponsored defined benefit plans and other postretirement benefits. Service cost will be included within the same income statement line item as other compensation costs arising from services rendered during the period, while other components of net periodic benefit pension cost will be presented separately outside of operating income. Additionally, only service costs may be capitalized in assets. ASU 2017-07 is effective for fiscal years (and interim reporting periods within those years) beginning after December 15, 2017. The provisions of ASU 2017-07 are not expected to have a material effect on the Company's financial condition, results of operations, or cash flows. In January 2017, the FASB issued ASU No. 2017-01, Clarifying the Definition of a Business (“ASU 2017-01”), which requires an evaluation of whether substantially all of the fair value of assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If so, the transaction does not qualify as a business. The guidance also requires an acquired business to include at least one substantive process and narrows the definition of outputs. The Company is required to apply this guidance to annual periods beginning after December 15, 2017, including interim periods within those periods. The Company is currently evaluating the impact of the provisions of ASU 2017-01 and intends to implement the standard as required in fiscal 2019. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (“ASU 2016-15”), which is intended to reduce the diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows including debt prepayment and extinguishment costs, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, and proceeds from the settlement of corporate-owned life insurance. ASU 2016-15 is effective for fiscal years (and interim reporting periods within those years) beginning after December 15, 2017. The Company intends to implement the standard as required in fiscal 2019, and the provisions of ASU 2016-15 are not expected to have a material impact on the Company's financial statement disclosures. In February 2016, the FASB issued ASU No. 2016-02, Leases (“ASU 2016-02”), which requires lessees to include most leases on the balance sheet. ASU 2016-02 is effective for fiscal years (and interim reporting periods within those years) beginning after December 15, 2018. The Company is currently evaluating the impact of the provisions of ASU 2016-02 and intends to implement the standard as required in fiscal 2020. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”), which will replace most existing revenue recognition guidance in U.S. GAAP. ASU 2014-09 outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. The standard also requires additional disclosures about the nature, timing, and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments. ASU 2014-09 permits two transition methods: the full retrospective method and the modified retrospective method. Under the full retrospective method, the standard would be applied to each prior reporting period presented with the cumulative effect of applying the standard recognized at the earliest period shown. Under the modified retrospective method, the cumulative effect of applying the standard would be recognized at the date of initial application. In March 2016, the FASB issued ASU 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations (Reporting Revenue Gross versus Net) , which clarifies the guidance in ASU 2014-09 and has the same effective date as the original standard. During the three months ended July 1, 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing; ASU 2016-11, Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting; and ASU 2016-12, Revenue from Contracts with Customers: Narrow-Scope Improvements and Practical Expedients. These amendments are intended to improve and clarify the implementation guidance of ASU 2014-09 and have the same effective date as the original standard. The Company has an implementation team tasked with identifying potential differences that will result from applying the new revenue recognition standard to the Company's contracts with its customers. The implementation team reports the findings and progress of the project to management on a frequent basis and to the Audit Committee of the Board of Directors on a quarterly basis. The implementation team has completed its initial phase of contract reviews and continues to evaluate the results of those reviews with respect to potential changes from adopting the new standard on the Company's consolidated financial statements. Management anticipates the most significant changes will relate to additional deferral of revenue recognition for certain services provided and the gross presentation of right of return assets and refund liabilities for sales with a right of return. Based on the current portfolio of the Company's revenue generating activities, these changes are not expected to have a material impact on the Company's consolidated financial condition, results of operations, or cash flows. Additionally, the implementation team is in the process of identifying appropriate changes to the Company's business processes, systems, and controls to support recognition and disclosure under the new standard. Based on the implementation team's current findings and the overall expected immaterial impact of adoption, the implementation team is currently evaluating which adoption method would provide the most meaningful information to the Company's stakeholders. The Company will adopt the requirements of the new standard no later than the effective date of September 1, 2018. All other newly issued accounting pronouncements not yet effective have been deemed either immaterial or not applicable. |
Methodologies used to determine fair values of financial assets and liabilities | The Company utilizes valuation methodologies to determine the fair values of its financial assets and liabilities in conformity with the concepts of “exit price” and the fair value hierarchy as prescribed in ASC 820. All valuation methods and assumptions are validated at least quarterly to ensure the accuracy and relevance of the fair values. There were no material changes to the valuation methods or assumptions used to determine fair values during the current period. |
Recognition of transfers between levels within the fair value hierarchy | The Company used quoted market prices to determine the fair value of Level 1 assets and liabilities. No transfers between the levels of the fair value hierarchy occurred during the current fiscal period. In the event of a transfer in or out of a level within the fair value hierarchy, the transfers would be recognized on the date of occurrence. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Value and Estimated Fair Value of Financial Instruments | The carrying values and estimated fair values of certain of the Company’s financial instruments were as follows at November 30, 2017 and August 31, 2017 (in millions): November 30, 2017 August 31, 2017 Carrying Value Fair Value Carrying Value Fair Value Senior unsecured public notes, net of unamortized discount and deferred costs $ 349.2 $ 374.1 $ 349.1 $ 379.7 Industrial revenue bond 4.0 4.0 4.0 4.0 Bank loans 3.7 3.7 3.8 3.8 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The change in the carrying amount of goodwill during the three months ended November 30, 2017 is summarized below (in millions): Balance at August 31, 2017 $ 900.9 Foreign currency translation adjustments (4.4 ) Balance at November 30, 2017 $ 896.5 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories include materials, labor, in-bound freight, and related manufacturing overhead, are stated at the lower of cost (on a first-in, first-out or average cost basis) or market, and consist of the following (in millions): November 30, 2017 August 31, 2017 Raw materials, supplies, and work in process (1) $ 176.4 $ 176.5 Finished goods 193.1 180.8 Inventories excluding reserves 369.5 357.3 Less: Reserves (29.9 ) (28.7 ) Total inventories $ 339.6 $ 328.6 _______________________________________ (1) Due to the immaterial amount of estimated work in process and the short lead times for the conversion of raw materials to finished goods, the Company does not believe the segregation of raw materials and work in process is meaningful information. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table calculates basic earnings per common share and diluted earnings per common share for the three months ended November 30, 2017 and 2016 (in millions, except per share data): Three Months Ended November 30, 2017 November 30, 2016 Net income $ 71.5 $ 81.7 Basic weighted average shares outstanding 41.9 43.8 Common stock equivalents 0.2 0.2 Diluted weighted average shares outstanding 42.1 44.0 Basic earnings per share $ 1.71 $ 1.87 Diluted earnings per share $ 1.70 $ 1.86 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table presents stock options and restricted stock awards that were excluded from the diluted earnings per share calculation for the three months ended November 30, 2017 and 2016 as the effect of inclusion would have been antidilutive: Three Months Ended November 30, 2017 November 30, 2016 Stock options 163,812 81,487 Restricted stock awards 211,576 25,994 |
Comprehensive Income (Tables)
Comprehensive Income (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Equity [Abstract] | |
Changes in components of accumulated other comprehensive income (loss) items | The following table presents the changes in each component of accumulated other comprehensive income (loss) during the three months ended November 30, 2017 (in millions): Foreign Currency Items Defined Benefit Pension Plans Accumulated Other Comprehensive Loss Items Balance at August 31, 2017 $ (28.7 ) $ (71.0 ) $ (99.7 ) Other comprehensive loss before reclassifications (10.5 ) — (10.5 ) Amounts reclassified from accumulated other comprehensive income — 1.6 1.6 Net current period other comprehensive (loss) income (10.5 ) 1.6 (8.9 ) Balance at November 30, 2017 $ (39.2 ) $ (69.4 ) $ (108.6 ) |
Schedule of comprehensive income (loss) | The following table presents the tax expense or benefit allocated to each component of other comprehensive income (loss) for the three months ended November 30, 2017 and 2016 (in millions): Three Months Ended November 30, 2017 November 30, 2016 Before Tax Amount Tax (Expense) Benefit Net of Tax Amount Before Tax Amount Tax (Expense) Benefit Net of Tax Amount Foreign currency translation adjustments $ (10.5 ) $ — $ (10.5 ) $ (11.9 ) $ — $ (11.9 ) Defined benefit pension plans: Amortization of defined benefit pension items: Prior service cost (1) 0.8 (0.3 ) 0.5 0.8 (0.3 ) 0.5 Actuarial losses (1) 1.7 (0.6 ) 1.1 2.2 (0.7 ) 1.5 Total defined benefit pension plans, net 2.5 (0.9 ) 1.6 3.0 (1.0 ) 2.0 Other comprehensive loss $ (8.0 ) $ (0.9 ) $ (8.9 ) $ (8.9 ) $ (1.0 ) $ (9.9 ) _______________________________________ (1) The before tax amount of these other comprehensive income (loss) components is included in net periodic pension cost. See Pension Plans footnote within the Notes to Consolidated Financial Statements for additional details. |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Debt Disclosure [Abstract] | |
Components of Interest Expense, Net | The following table summarizes the components of interest expense, net for the three months ended November 30, 2017 and 2016 (in millions): Three Months Ended November 30, 2017 November 30, 2016 Interest expense $ 8.7 $ 8.6 Interest income (0.6 ) (0.4 ) Interest expense, net $ 8.1 $ 8.2 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Product Warranty Liability | The changes in the reserves for product warranty and recall costs during the three months ended November 30, 2017 and 2016 are summarized as follows (in millions): Three Months Ended November 30, 2017 November 30, 2016 Beginning balance $ 22.0 $ 15.5 Warranty and recall costs 8.6 9.2 Payments and other deductions (6.7 ) (7.2 ) Ending balance $ 23.9 $ 17.5 |
Share-based Payments (Tables)
Share-based Payments (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Share-based Payment Expense and Shares Issued Upon Exercise of Options | The following table presents share-based payment expense and new shares issued upon exercise of stock options for the three months ended November 30, 2017 and 2016 (in millions, except shares): Three Months Ended November 30, 2017 November 30, 2016 Share-based payment expense $ 8.5 $ 7.9 Shares issued from option exercises 6,156 12,030 |
Pension Plans (Tables)
Pension Plans (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Retirement Benefits [Abstract] | |
Schedule of Net Periodic Pension Cost | Net periodic pension cost for the Company’s defined benefit pension plans during the three months ended November 30, 2017 and 2016 included the following components before tax (in millions): Three Months Ended November 30, 2017 November 30, 2016 Service cost $ 0.7 $ 0.9 Interest cost 2.2 2.0 Expected return on plan assets (3.1 ) (2.8 ) Amortization of prior service cost 0.8 0.8 Recognized actuarial loss 1.7 2.2 Net periodic pension cost $ 2.3 $ 3.1 |
Special Charge (Tables)
Special Charge (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Restructuring and Related Activities [Abstract] | |
Summary Schedule of Special Charge | The details of the special charge during the three months ended November 30, 2017 and 2016 are summarized as follows (in millions): Three Months Ended November 30, 2017 November 30, 2016 Severance and employee-related costs $ 0.2 $ (0.2 ) Lease termination and other costs — 1.4 Total special charges $ 0.2 $ 1.2 |
Schedule of Restructuring Reserve by Type of Cost | The changes in the reserves related to these programs during the three months ended November 30, 2017 are summarized as follows (in millions): Fiscal 2017 Actions Fiscal 2016 Actions Total Balance at August 31, 2017 $ 11.2 $ 1.4 $ 12.6 Severance costs 0.2 — 0.2 Payments made during the period (2.1 ) (0.5 ) (2.6 ) Balance at November 30, 2017 $ 9.3 $ 0.9 $ 10.2 |
Supplemental Guarantor Conden32
Supplemental Guarantor Condensed Consolidating Financial Statements (Tables) | 3 Months Ended |
Nov. 30, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
CONDENSED CONSOLIDATING BALANCE SHEETS | CONDENSED CONSOLIDATING BALANCE SHEETS (In millions) November 30, 2017 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated ASSETS Current assets: Cash and cash equivalents $ 364.8 $ — $ — $ 63.8 $ — $ 428.6 Accounts receivable, net — 443.5 — 70.8 — 514.3 Inventories — 314.5 — 25.1 — 339.6 Other current assets 11.0 14.8 — 15.5 — 41.3 Total current assets 375.8 772.8 — 175.2 — 1,323.8 Property, plant, and equipment, net 0.3 227.0 — 58.8 — 286.1 Goodwill — 677.5 2.7 216.3 — 896.5 Intangible assets, net — 232.5 108.9 98.5 — 439.9 Deferred income taxes 51.5 — — 7.9 (56.1 ) 3.3 Other long-term assets 0.2 9.3 — 2.3 — 11.8 Investments in and amounts due from affiliates 1,469.7 459.4 244.0 — (2,173.1 ) — Total assets $ 1,897.5 $ 2,378.5 $ 355.6 $ 559.0 $ (2,229.2 ) $ 2,961.4 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 0.3 $ 340.5 $ — $ 23.8 $ — $ 364.6 Current maturities of long-term debt — — — 0.4 — 0.4 Other accrued liabilities 65.5 126.1 — 38.3 — 229.9 Total current liabilities 65.8 466.6 — 62.5 — 594.9 Long-term debt — 353.2 — 3.3 — 356.5 Deferred income taxes — 134.6 — 29.8 (56.1 ) 108.3 Other long-term liabilities 105.6 49.7 — 20.3 — 175.6 Amounts due to affiliates — — — 117.4 (117.4 ) — Total stockholders’ equity 1,726.1 1,374.4 355.6 325.7 (2,055.7 ) 1,726.1 Total liabilities and stockholders’ equity $ 1,897.5 $ 2,378.5 $ 355.6 $ 559.0 $ (2,229.2 ) $ 2,961.4 CONDENSED CONSOLIDATING BALANCE SHEETS (In millions) August 31, 2017 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated ASSETS Current assets: Cash and cash equivalents $ 237.7 $ — $ — $ 73.4 $ — $ 311.1 Accounts receivable, net — 494.6 — 78.7 — 573.3 Inventories — 305.5 — 23.1 — 328.6 Other current assets 1.6 15.8 — 15.2 — 32.6 Total current assets 239.3 815.9 — 190.4 — 1,245.6 Property, plant, and equipment, net 0.2 228.3 — 59.2 — 287.7 Goodwill — 677.7 2.7 220.5 — 900.9 Intangible assets, net — 235.5 109.8 103.5 — 448.8 Deferred income taxes 51.6 — — 8.0 (56.2 ) 3.4 Other long-term assets 1.5 10.9 — 0.8 — 13.2 Investments in and amounts due from affiliates 1,500.3 330.4 234.2 — (2,064.9 ) — Total assets $ 1,792.9 $ 2,298.7 $ 346.7 $ 582.4 $ (2,121.1 ) $ 2,899.6 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 0.9 $ 366.4 $ — $ 27.8 $ — $ 395.1 Current maturities of long-term debt — — — 0.4 — 0.4 Other accrued liabilities 27.6 138.9 — 38.9 — 205.4 Total current liabilities 28.5 505.3 — 67.1 — 600.9 Long-term debt — 353.1 — 3.4 — 356.5 Deferred income taxes — 134.6 — 29.8 (56.2 ) 108.2 Other long-term liabilities 98.7 49.3 — 20.4 — 168.4 Amounts due to affiliates — — — 128.8 (128.8 ) — Total stockholders’ equity 1,665.7 1,256.4 346.7 332.9 (1,936.1 ) 1,665.6 Total liabilities and stockholders’ equity $ 1,792.9 $ 2,298.7 $ 346.7 $ 582.4 $ (2,121.1 ) $ 2,899.6 |
CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME | CONDENSED CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME (In millions) Three Months Ended November 30, 2017 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated Net sales: External sales $ — $ 744.2 $ — $ 98.6 $ — $ 842.8 Intercompany sales — — 12.0 43.5 (55.5 ) — Total sales — 744.2 12.0 142.1 (55.5 ) 842.8 Cost of products sold — 429.8 — 104.9 (42.1 ) 492.6 Gross profit — 314.4 12.0 37.2 (13.4 ) 350.2 Selling, distribution, and administrative expenses 12.7 194.7 0.8 36.6 (13.4 ) 231.4 Intercompany charges (1.0 ) (0.5 ) — 1.5 — — Special charge — 0.2 — — — 0.2 Operating (loss) profit (11.7 ) 120.0 11.2 (0.9 ) — 118.6 Interest expense, net 2.7 4.0 — 1.4 — 8.1 Equity earnings in subsidiaries (80.9 ) (1.1 ) — — 82.0 — Miscellaneous expense (income), net — 0.8 — (1.2 ) — (0.4 ) Income (loss) before provision for income taxes 66.5 116.3 11.2 (1.1 ) (82.0 ) 110.9 (Benefit) provision for income taxes (5.0 ) 42.2 2.2 — — 39.4 Net income (loss) 71.5 74.1 9.0 (1.1 ) (82.0 ) 71.5 Other comprehensive income (loss) items: Foreign currency translation adjustments (10.5 ) (10.5 ) — — 10.5 (10.5 ) Defined benefit pension plans, net 1.6 1.2 — 0.4 (1.6 ) 1.6 Other comprehensive (loss) income items, net of tax (8.9 ) (9.3 ) — 0.4 8.9 (8.9 ) Comprehensive income (loss) $ 62.6 $ 64.8 $ 9.0 $ (0.7 ) $ (73.1 ) $ 62.6 CONDENSED CONSOL IDATING STATEMENTS OF COMPREHENSIVE INCOME (In millions) Three Months Ended November 30, 2016 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated Net sales: External sales $ — $ 746.3 $ — $ 104.9 $ — $ 851.2 Intercompany sales — — 11.5 51.6 (63.1 ) — Total sales — 746.3 11.5 156.5 (63.1 ) 851.2 Cost of products sold — 426.9 — 114.9 (50.2 ) 491.6 Gross profit — 319.4 11.5 41.6 (12.9 ) 359.6 Selling, distribution, and administrative expenses 11.8 199.9 0.9 32.1 (12.9 ) 231.8 Intercompany charges (1.2 ) 0.2 — 1.0 — — Special charge — 1.2 — — — 1.2 Operating (loss) profit (10.6 ) 118.1 10.6 8.5 — 126.6 Interest expense, net 2.8 4.0 — 1.4 — 8.2 Equity earnings in subsidiaries (90.4 ) (9.1 ) — 0.2 99.3 — Miscellaneous income, net — (7.3 ) — (0.6 ) — (7.9 ) Income before provision for income taxes 77.0 130.5 10.6 7.5 (99.3 ) 126.3 (Benefit) provision for income taxes (4.7 ) 47.8 0.9 0.6 — 44.6 Net income 81.7 82.7 9.7 6.9 (99.3 ) 81.7 Other comprehensive income (loss) items: Foreign currency translation adjustments (11.9 ) (11.9 ) — — 11.9 (11.9 ) Defined benefit pension plans, net 2.0 0.7 — 0.7 (1.4 ) 2.0 Other comprehensive (loss) income items, net of tax (9.9 ) (11.2 ) — 0.7 10.5 (9.9 ) Comprehensive income $ 71.8 $ 71.5 $ 9.7 $ 7.6 $ (88.8 ) $ 71.8 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS | CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (In millions) Three Months Ended November 30, 2017 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated Net cash provided by operating activities $ 137.8 $ 5.8 $ — $ (3.8 ) $ — $ 139.8 Cash flows from investing activities: Purchases of property, plant, and equipment — (7.2 ) — (3.1 ) — (10.3 ) Net cash used for investing activities — (7.2 ) — (3.1 ) — (10.3 ) Cash flows from financing activities: Repayments of long-term debt — — — (0.1 ) — (0.1 ) Proceeds from stock option exercises and other 0.8 — — — — 0.8 Employee taxes on net settlement of equity awards (6.0 ) — — — — (6.0 ) Dividends paid (5.5 ) — — — — (5.5 ) Net cash used for financing activities (10.7 ) — — (0.1 ) — (10.8 ) Effect of exchange rates changes on cash — 1.4 — (2.6 ) — (1.2 ) Net change in cash and cash equivalents 127.1 — — (9.6 ) — 117.5 Cash and cash equivalents at beginning of period 237.7 — — 73.4 — 311.1 Cash and cash equivalents at end of period $ 364.8 $ — $ — $ 63.8 $ — $ 428.6 CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS (In millions) Three Months Ended November 30, 2016 Parent Subsidiary Issuer Subsidiary Guarantor Non- Guarantors Consolidating Adjustments Consolidated Net cash provided by operating activities $ 36.5 $ 2.2 $ — $ 17.1 $ — $ 55.8 Cash flows from investing activities: Purchases of property, plant, and equipment — (16.5 ) — (3.0 ) — (19.5 ) Proceeds from sale of property, plant, and equipment — — — 5.4 — 5.4 Proceeds from sale of investment — 13.0 — — — 13.0 Net cash (used for) provided by investing activities — (3.5 ) — 2.4 — (1.1 ) Cash flows from financing activities: Issuance of long-term debt — — — 0.9 — 0.9 Proceeds from stock option exercises and other 2.1 — — — — 2.1 Repurchases of common stock (0.4 ) — — — — (0.4 ) Employee taxes on net settlement of equity awards (11.3 ) — — — — (11.3 ) Dividends paid (5.8 ) — — — — (5.8 ) Net cash (used for) provided by financing activities (15.4 ) — — 0.9 — (14.5 ) Effect of exchange rate changes on cash — 1.3 — (3.5 ) — (2.2 ) Net change in cash and cash equivalents 21.1 — — 16.9 — 38.0 Cash and cash equivalents at beginning of period 368.2 — — 45.0 — 413.2 Cash and cash equivalents at end of period $ 389.3 $ — $ — $ 61.9 $ — $ 451.2 |
Description of Business and B33
Description of Business and Basis of Presentation (Details) | 3 Months Ended |
Nov. 30, 2017Segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 1 |
New Accounting Pronouncements (
New Accounting Pronouncements (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Increase to cash provided by operating activities | $ 139.8 | $ 55.8 |
Decrease to cash provided by financing activities | $ 10.8 | 14.5 |
Accounting Standards Update 2016-09 | ||
New Accounting Pronouncement, Early Adoption [Line Items] | ||
Increase to cash provided by operating activities | 17.1 | |
Decrease to cash provided by financing activities | $ 17.1 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Millions | Nov. 30, 2017 | Aug. 31, 2017 | Nov. 30, 2016 | Aug. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Cash and cash equivalents | $ 428.6 | $ 311.1 | $ 451.2 | $ 413.2 |
Carrying Value | Senior unsecured public notes, net of unamortized discount and deferred costs | ||||
Liabilities: | ||||
Carrying and estimated fair values of financial instruments | 349.2 | 349.1 | ||
Carrying Value | Industrial revenue bond | Industrial Revenue Bond Maturing in 2021 | ||||
Liabilities: | ||||
Carrying and estimated fair values of financial instruments | 4 | 4 | ||
Carrying Value | Bank loans | ||||
Liabilities: | ||||
Carrying and estimated fair values of financial instruments | 3.7 | 3.8 | ||
Fair Value | Level 2 | Senior unsecured public notes, net of unamortized discount and deferred costs | ||||
Liabilities: | ||||
Carrying and estimated fair values of financial instruments | 374.1 | 379.7 | ||
Fair Value | Level 2 | Industrial revenue bond | Industrial Revenue Bond Maturing in 2021 | ||||
Liabilities: | ||||
Carrying and estimated fair values of financial instruments | 4 | 4 | ||
Fair Value | Level 2 | Bank loans | ||||
Liabilities: | ||||
Carrying and estimated fair values of financial instruments | $ 3.7 | $ 3.8 |
Goodwill and Intangible Asset36
Goodwill and Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of intangible assets | $ 6.6 | $ 5.9 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
Amortization expense in fiscal 2018 | 26.2 | |
Amortization expense in fiscal 2019 | 26.1 | |
Amortization expense in fiscal 2020 | 25.8 | |
Amortization expense in fiscal 2021 | 23 | |
Amortization expense in fiscal 2022 | $ 21.2 |
Goodwill and Intangible Asset37
Goodwill and Intangible Assets (Changes in Goodwill) (Details) $ in Millions | 3 Months Ended |
Nov. 30, 2017USD ($) | |
Goodwill [Roll Forward] | |
Goodwill, Beginning Balance | $ 900.9 |
Foreign currency translation adjustments | (4.4) |
Goodwill, Ending Balance | $ 896.5 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Nov. 30, 2017 | Aug. 31, 2017 |
Inventory, Net [Abstract] | ||
Raw materials, supplies, and work in process | $ 176.4 | $ 176.5 |
Finished goods | 193.1 | 180.8 |
Inventories excluding reserves | 369.5 | 357.3 |
Less: Reserves | (29.9) | (28.7) |
Total inventories | $ 339.6 | $ 328.6 |
Earnings Per Share (Basic and D
Earnings Per Share (Basic and Diluted Earnings per Share - Treasury Stock Method) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Earnings Per Share [Abstract] | ||
Net Income | $ 71.5 | $ 81.7 |
Basic weighted average shares outstanding (in shares) | 41.9 | 43.8 |
Common stock equivalents (in shares) | 0.2 | 0.2 |
Diluted weighted average shares outstanding (in shares) | 42.1 | 44 |
Basic earnings per share (in dollars per share) | $ 1.71 | $ 1.87 |
Diluted earnings per share (in dollars per share) | $ 1.70 | $ 1.86 |
Earnings Per Share (Antidilutiv
Earnings Per Share (Antidilutive Securities Excluded from EPS Computation) (Details) - shares | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Stock options excluded from diluted earnings per share (in shares) | 163,812 | 81,487 |
Restricted stock awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Stock options excluded from diluted earnings per share (in shares) | 211,576 | 25,994 |
Comprehensive Income (Changes i
Comprehensive Income (Changes in Components of Accumulated Other Comprehensive Income (Loss) Items) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at August 31, 2017 | $ 1,665.6 | |
Balance at November 30, 2017 | 1,726.1 | |
Accumulated Other Comprehensive Loss Items | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at August 31, 2017 | (99.7) | |
Other comprehensive loss before reclassifications | (10.5) | |
Amounts reclassified from accumulated other comprehensive income | 1.6 | |
Other comprehensive income (loss), net of tax | (8.9) | $ (9.9) |
Balance at November 30, 2017 | (108.6) | |
Foreign Currency Items | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at August 31, 2017 | (28.7) | |
Other comprehensive loss before reclassifications | (10.5) | |
Amounts reclassified from accumulated other comprehensive income | 0 | |
Other comprehensive income (loss), net of tax | (10.5) | (11.9) |
Balance at November 30, 2017 | (39.2) | |
Defined Benefit Pension Plans | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||
Balance at August 31, 2017 | (71) | |
Other comprehensive loss before reclassifications | 0 | |
Amounts reclassified from accumulated other comprehensive income | 1.6 | |
Other comprehensive income (loss), net of tax | 1.6 | $ 2 |
Balance at November 30, 2017 | $ (69.4) |
Comprehensive Income (Tax Amoun
Comprehensive Income (Tax Amounts Allocated to Components of Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Other comprehensive loss | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Other comprehensive income (loss), before tax | $ (8) | $ (8.9) |
Other comprehensive income (loss), tax | (0.9) | (1) |
Other comprehensive income (loss), net of tax | (8.9) | (9.9) |
Foreign currency translation adjustments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Other comprehensive income (loss), before tax | (10.5) | (11.9) |
Other comprehensive income (loss), tax | 0 | 0 |
Other comprehensive income (loss), net of tax | (10.5) | (11.9) |
Total defined benefit pension plans, net | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Other comprehensive income (loss), before tax | 2.5 | 3 |
Other comprehensive income (loss), tax | (0.9) | (1) |
Other comprehensive income (loss), net of tax | 1.6 | 2 |
Prior service cost | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Other comprehensive income (loss), before tax | 0.8 | 0.8 |
Other comprehensive income (loss), tax | (0.3) | (0.3) |
Other comprehensive income (loss), net of tax | 0.5 | 0.5 |
Actuarial losses | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Other comprehensive income (loss), before tax | 1.7 | 2.2 |
Other comprehensive income (loss), tax | (0.6) | (0.7) |
Other comprehensive income (loss), net of tax | $ 1.1 | $ 1.5 |
Debt (Details)
Debt (Details) | 3 Months Ended | ||
Nov. 30, 2017USD ($) | Nov. 30, 2016USD ($) | Aug. 27, 2014USD ($) | |
Interest Revenue (Expense), Net [Abstract] | |||
Interest expense | $ 8,700,000 | $ 8,600,000 | |
Interest income | (600,000) | (400,000) | |
Interest expense, net | 8,100,000 | $ 8,200,000 | |
Lines of Credit | |||
Line of Credit Facility [Abstract] | |||
Outstanding letters of credit | 10,200,000 | ||
Lines of Credit | Revolving Credit Facility Maturing August 27, 2019 | |||
Line of Credit Facility [Abstract] | |||
Executed revolving credit facility | $ 250,000,000 | ||
Borrowings outstanding | 0 | ||
Additional borrowing capacity under revolving credit facility | $ 244,700,000 | ||
Lines of Credit | Revolving Credit Facility Maturing August 27, 2019 | Minimum | |||
Line of Credit Facility [Abstract] | |||
Minimum interest coverage ratio | 2.50 | ||
Applicable margins based on company's leverage ratio, percentage | 1.00% | ||
Facility fee, percentage | 0.125% | ||
Lines of Credit | Revolving Credit Facility Maturing August 27, 2019 | Maximum | |||
Line of Credit Facility [Abstract] | |||
Maximum leverage ratio | 3.50 | ||
Applicable margins based on company's leverage ratio, percentage | 1.575% | ||
Facility fee, percentage | 0.30% | ||
Letter of Credit | Revolving Credit Facility Maturing August 27, 2019 | |||
Line of Credit Facility [Abstract] | |||
Outstanding letters of credit | $ 5,300,000 | ||
Senior unsecured public notes | Senior Unsecured Notes Maturing December 2019 | |||
Debt Instruments [Abstract] | |||
Debt outstanding | $ 350,000,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 6.00% | ||
Industrial revenue bond | Industrial Revenue Bond Maturing in 2021 | |||
Debt Instruments [Abstract] | |||
Debt outstanding | $ 4,000,000 | ||
Bank loans | 2016 Fixed-rate Bank Loans | |||
Debt Instruments [Abstract] | |||
Debt outstanding | $ 3,700,000 |
Commitments and Contingencies44
Commitments and Contingencies (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Standard warranty term | 5 years | |
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward] | ||
Beginning balance | $ 22 | $ 15.5 |
Warranty and recall costs | 8.6 | 9.2 |
Payments and other deductions | (6.7) | (7.2) |
Ending balance | $ 23.9 | $ 17.5 |
Share-based Payments (Details)
Share-based Payments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ||
Share-based payment expense | $ 8.5 | $ 7.9 |
Shares issued from option exercises (shares) | 6,156 | 12,030 |
Pension Plans (Details)
Pension Plans (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | ||
Service cost | $ 0.7 | $ 0.9 |
Interest cost | 2.2 | 2 |
Expected return on plan assets | (3.1) | (2.8) |
Amortization of prior service cost | 0.8 | 0.8 |
Recognized actuarial loss | 1.7 | 2.2 |
Net periodic pension cost | $ 2.3 | $ 3.1 |
Special Charge (Details)
Special Charge (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||
Total special charges | $ 0.2 | $ 1.2 |
Restructuring Reserve [Roll Forward] | ||
Balance, beginning of period | 12.6 | |
Severance costs | 0.2 | |
Payments made during the period | (2.6) | |
Balance, end of period | 10.2 | |
Restructuring Charges | ||
Restructuring Cost and Reserve [Line Items] | ||
Total special charges | 0.2 | 1.2 |
Restructuring Charges | Severance and employee-related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Total special charges | 0.2 | (0.2) |
Restructuring Charges | Lease termination and other costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Total special charges | 0 | $ 1.4 |
Fiscal 2017 Actions | ||
Restructuring Reserve [Roll Forward] | ||
Balance, beginning of period | 11.2 | |
Severance costs | 0.2 | |
Payments made during the period | (2.1) | |
Balance, end of period | 9.3 | |
Fiscal 2016 Actions | ||
Restructuring Reserve [Roll Forward] | ||
Balance, beginning of period | 1.4 | |
Severance costs | 0 | |
Payments made during the period | (0.5) | |
Balance, end of period | $ 0.9 |
Subsequent Events (Details)
Subsequent Events (Details) | Jan. 08, 2018 | Nov. 30, 2017 |
Subsequent Event [Line Items] | ||
Federal corporate tax rate (percent) | 35.00% | |
Subsequent Events | ||
Subsequent Event [Line Items] | ||
Federal corporate tax rate (percent) | 21.00% |
Supplemental Guarantor Conden49
Supplemental Guarantor Condensed Consolidating Financial Statements (Balance Sheets) (Details) - USD ($) $ in Millions | Nov. 30, 2017 | Aug. 31, 2017 | Nov. 30, 2016 | Aug. 31, 2016 |
Current Assets: | ||||
Cash and cash equivalents | $ 428.6 | $ 311.1 | $ 451.2 | $ 413.2 |
Accounts receivable, net | 514.3 | 573.3 | ||
Inventories | 339.6 | 328.6 | ||
Other current assets | 41.3 | 32.6 | ||
Total current assets | 1,323.8 | 1,245.6 | ||
Property, plant, and equipment, net | 286.1 | 287.7 | ||
Goodwill | 896.5 | 900.9 | ||
Intangible assets, net | 439.9 | 448.8 | ||
Deferred income taxes | 3.3 | 3.4 | ||
Other long-term assets | 11.8 | 13.2 | ||
Investments in and amounts due from affiliates | 0 | 0 | ||
Total assets | 2,961.4 | 2,899.6 | ||
Current Liabilities: | ||||
Accounts payable | 364.6 | 395.1 | ||
Current maturities of long-term debt | 0.4 | 0.4 | ||
Other accrued liabilities | 229.9 | 205.4 | ||
Total current liabilities | 594.9 | 600.9 | ||
Long-term debt | 356.5 | 356.5 | ||
Deferred income taxes | 108.3 | 108.2 | ||
Other long-term liabilities | 175.6 | 168.4 | ||
Amounts due to affiliates | 0 | 0 | ||
Total stockholders’ equity | 1,726.1 | 1,665.6 | ||
Total liabilities and stockholders’ equity | 2,961.4 | 2,899.6 | ||
Parent | ||||
Current Assets: | ||||
Cash and cash equivalents | 364.8 | 237.7 | 389.3 | 368.2 |
Accounts receivable, net | 0 | 0 | ||
Inventories | 0 | 0 | ||
Other current assets | 11 | 1.6 | ||
Total current assets | 375.8 | 239.3 | ||
Property, plant, and equipment, net | 0.3 | 0.2 | ||
Goodwill | 0 | 0 | ||
Intangible assets, net | 0 | 0 | ||
Deferred income taxes | 51.5 | 51.6 | ||
Other long-term assets | 0.2 | 1.5 | ||
Investments in and amounts due from affiliates | 1,469.7 | 1,500.3 | ||
Total assets | 1,897.5 | 1,792.9 | ||
Current Liabilities: | ||||
Accounts payable | 0.3 | 0.9 | ||
Current maturities of long-term debt | 0 | 0 | ||
Other accrued liabilities | 65.5 | 27.6 | ||
Total current liabilities | 65.8 | 28.5 | ||
Long-term debt | 0 | 0 | ||
Deferred income taxes | 0 | 0 | ||
Other long-term liabilities | 105.6 | 98.7 | ||
Amounts due to affiliates | 0 | 0 | ||
Total stockholders’ equity | 1,726.1 | 1,665.7 | ||
Total liabilities and stockholders’ equity | 1,897.5 | 1,792.9 | ||
Subsidiary Issuer | ||||
Current Assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 443.5 | 494.6 | ||
Inventories | 314.5 | 305.5 | ||
Other current assets | 14.8 | 15.8 | ||
Total current assets | 772.8 | 815.9 | ||
Property, plant, and equipment, net | 227 | 228.3 | ||
Goodwill | 677.5 | 677.7 | ||
Intangible assets, net | 232.5 | 235.5 | ||
Deferred income taxes | 0 | 0 | ||
Other long-term assets | 9.3 | 10.9 | ||
Investments in and amounts due from affiliates | 459.4 | 330.4 | ||
Total assets | 2,378.5 | 2,298.7 | ||
Current Liabilities: | ||||
Accounts payable | 340.5 | 366.4 | ||
Current maturities of long-term debt | 0 | 0 | ||
Other accrued liabilities | 126.1 | 138.9 | ||
Total current liabilities | 466.6 | 505.3 | ||
Long-term debt | 353.2 | 353.1 | ||
Deferred income taxes | 134.6 | 134.6 | ||
Other long-term liabilities | 49.7 | 49.3 | ||
Amounts due to affiliates | 0 | 0 | ||
Total stockholders’ equity | 1,374.4 | 1,256.4 | ||
Total liabilities and stockholders’ equity | 2,378.5 | 2,298.7 | ||
Subsidiary Guarantor | ||||
Current Assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | ||
Inventories | 0 | 0 | ||
Other current assets | 0 | 0 | ||
Total current assets | 0 | 0 | ||
Property, plant, and equipment, net | 0 | 0 | ||
Goodwill | 2.7 | 2.7 | ||
Intangible assets, net | 108.9 | 109.8 | ||
Deferred income taxes | 0 | 0 | ||
Other long-term assets | 0 | 0 | ||
Investments in and amounts due from affiliates | 244 | 234.2 | ||
Total assets | 355.6 | 346.7 | ||
Current Liabilities: | ||||
Accounts payable | 0 | 0 | ||
Current maturities of long-term debt | 0 | 0 | ||
Other accrued liabilities | 0 | 0 | ||
Total current liabilities | 0 | 0 | ||
Long-term debt | 0 | 0 | ||
Deferred income taxes | 0 | 0 | ||
Other long-term liabilities | 0 | 0 | ||
Amounts due to affiliates | 0 | 0 | ||
Total stockholders’ equity | 355.6 | 346.7 | ||
Total liabilities and stockholders’ equity | 355.6 | 346.7 | ||
Non- Guarantors | ||||
Current Assets: | ||||
Cash and cash equivalents | 63.8 | 73.4 | 61.9 | 45 |
Accounts receivable, net | 70.8 | 78.7 | ||
Inventories | 25.1 | 23.1 | ||
Other current assets | 15.5 | 15.2 | ||
Total current assets | 175.2 | 190.4 | ||
Property, plant, and equipment, net | 58.8 | 59.2 | ||
Goodwill | 216.3 | 220.5 | ||
Intangible assets, net | 98.5 | 103.5 | ||
Deferred income taxes | 7.9 | 8 | ||
Other long-term assets | 2.3 | 0.8 | ||
Investments in and amounts due from affiliates | 0 | 0 | ||
Total assets | 559 | 582.4 | ||
Current Liabilities: | ||||
Accounts payable | 23.8 | 27.8 | ||
Current maturities of long-term debt | 0.4 | 0.4 | ||
Other accrued liabilities | 38.3 | 38.9 | ||
Total current liabilities | 62.5 | 67.1 | ||
Long-term debt | 3.3 | 3.4 | ||
Deferred income taxes | 29.8 | 29.8 | ||
Other long-term liabilities | 20.3 | 20.4 | ||
Amounts due to affiliates | 117.4 | 128.8 | ||
Total stockholders’ equity | 325.7 | 332.9 | ||
Total liabilities and stockholders’ equity | 559 | 582.4 | ||
Consolidating Adjustments | ||||
Current Assets: | ||||
Cash and cash equivalents | 0 | 0 | $ 0 | $ 0 |
Accounts receivable, net | 0 | 0 | ||
Inventories | 0 | 0 | ||
Other current assets | 0 | 0 | ||
Total current assets | 0 | 0 | ||
Property, plant, and equipment, net | 0 | 0 | ||
Goodwill | 0 | 0 | ||
Intangible assets, net | 0 | 0 | ||
Deferred income taxes | (56.1) | (56.2) | ||
Other long-term assets | 0 | 0 | ||
Investments in and amounts due from affiliates | (2,173.1) | (2,064.9) | ||
Total assets | (2,229.2) | (2,121.1) | ||
Current Liabilities: | ||||
Accounts payable | 0 | 0 | ||
Current maturities of long-term debt | 0 | 0 | ||
Other accrued liabilities | 0 | 0 | ||
Total current liabilities | 0 | 0 | ||
Long-term debt | 0 | 0 | ||
Deferred income taxes | (56.1) | (56.2) | ||
Other long-term liabilities | 0 | 0 | ||
Amounts due to affiliates | (117.4) | (128.8) | ||
Total stockholders’ equity | (2,055.7) | (1,936.1) | ||
Total liabilities and stockholders’ equity | $ (2,229.2) | $ (2,121.1) |
Supplemental Guarantor Conden50
Supplemental Guarantor Condensed Consolidating Financial Statements (Income) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Net Sales: | ||
External sales | $ 842.8 | $ 851.2 |
Intercompany sales | 0 | 0 |
Total sales | 842.8 | 851.2 |
Cost of products sold | 492.6 | 491.6 |
Gross profit | 350.2 | 359.6 |
Selling, distribution, and administrative expenses | 231.4 | 231.8 |
Intercompany charges | 0 | 0 |
Special charge | 0.2 | 1.2 |
Operating profit | 118.6 | 126.6 |
Interest expense, net | 8.1 | 8.2 |
Equity earnings in subsidiaries | 0 | 0 |
Miscellaneous expense (income), net | (0.4) | (7.9) |
Income before provision for income taxes | 110.9 | 126.3 |
(Benefit) provision for income taxes | 39.4 | 44.6 |
Net income | 71.5 | 81.7 |
Other comprehensive income (loss) items: | ||
Foreign currency translation adjustments | (10.5) | (11.9) |
Defined benefit pension plans, net | 1.6 | 2 |
Other comprehensive loss, net of tax | (8.9) | (9.9) |
Comprehensive income | 62.6 | 71.8 |
Parent | ||
Net Sales: | ||
External sales | 0 | 0 |
Intercompany sales | 0 | 0 |
Total sales | 0 | 0 |
Cost of products sold | 0 | 0 |
Gross profit | 0 | 0 |
Selling, distribution, and administrative expenses | 12.7 | 11.8 |
Intercompany charges | (1) | (1.2) |
Special charge | 0 | 0 |
Operating profit | (11.7) | (10.6) |
Interest expense, net | 2.7 | 2.8 |
Equity earnings in subsidiaries | (80.9) | (90.4) |
Miscellaneous expense (income), net | 0 | 0 |
Income before provision for income taxes | 66.5 | 77 |
(Benefit) provision for income taxes | (5) | (4.7) |
Net income | 71.5 | 81.7 |
Other comprehensive income (loss) items: | ||
Foreign currency translation adjustments | (10.5) | (11.9) |
Defined benefit pension plans, net | 1.6 | 2 |
Other comprehensive loss, net of tax | (8.9) | (9.9) |
Comprehensive income | 62.6 | 71.8 |
Subsidiary Issuer | ||
Net Sales: | ||
External sales | 744.2 | 746.3 |
Intercompany sales | 0 | 0 |
Total sales | 744.2 | 746.3 |
Cost of products sold | 429.8 | 426.9 |
Gross profit | 314.4 | 319.4 |
Selling, distribution, and administrative expenses | 194.7 | 199.9 |
Intercompany charges | (0.5) | 0.2 |
Special charge | 0.2 | 1.2 |
Operating profit | 120 | 118.1 |
Interest expense, net | 4 | 4 |
Equity earnings in subsidiaries | (1.1) | (9.1) |
Miscellaneous expense (income), net | 0.8 | (7.3) |
Income before provision for income taxes | 116.3 | 130.5 |
(Benefit) provision for income taxes | 42.2 | 47.8 |
Net income | 74.1 | 82.7 |
Other comprehensive income (loss) items: | ||
Foreign currency translation adjustments | (10.5) | (11.9) |
Defined benefit pension plans, net | 1.2 | 0.7 |
Other comprehensive loss, net of tax | (9.3) | (11.2) |
Comprehensive income | 64.8 | 71.5 |
Subsidiary Guarantor | ||
Net Sales: | ||
External sales | 0 | 0 |
Intercompany sales | 12 | 11.5 |
Total sales | 12 | 11.5 |
Cost of products sold | 0 | 0 |
Gross profit | 12 | 11.5 |
Selling, distribution, and administrative expenses | 0.8 | 0.9 |
Intercompany charges | 0 | 0 |
Special charge | 0 | 0 |
Operating profit | 11.2 | 10.6 |
Interest expense, net | 0 | 0 |
Equity earnings in subsidiaries | 0 | 0 |
Miscellaneous expense (income), net | 0 | 0 |
Income before provision for income taxes | 11.2 | 10.6 |
(Benefit) provision for income taxes | 2.2 | 0.9 |
Net income | 9 | 9.7 |
Other comprehensive income (loss) items: | ||
Foreign currency translation adjustments | 0 | 0 |
Defined benefit pension plans, net | 0 | 0 |
Other comprehensive loss, net of tax | 0 | 0 |
Comprehensive income | 9 | 9.7 |
Non- Guarantors | ||
Net Sales: | ||
External sales | 98.6 | 104.9 |
Intercompany sales | 43.5 | 51.6 |
Total sales | 142.1 | 156.5 |
Cost of products sold | 104.9 | 114.9 |
Gross profit | 37.2 | 41.6 |
Selling, distribution, and administrative expenses | 36.6 | 32.1 |
Intercompany charges | 1.5 | 1 |
Special charge | 0 | 0 |
Operating profit | (0.9) | 8.5 |
Interest expense, net | 1.4 | 1.4 |
Equity earnings in subsidiaries | 0 | 0.2 |
Miscellaneous expense (income), net | (1.2) | (0.6) |
Income before provision for income taxes | (1.1) | 7.5 |
(Benefit) provision for income taxes | 0 | 0.6 |
Net income | (1.1) | 6.9 |
Other comprehensive income (loss) items: | ||
Foreign currency translation adjustments | 0 | 0 |
Defined benefit pension plans, net | 0.4 | 0.7 |
Other comprehensive loss, net of tax | 0.4 | 0.7 |
Comprehensive income | (0.7) | 7.6 |
Consolidating Adjustments | ||
Net Sales: | ||
External sales | 0 | 0 |
Intercompany sales | (55.5) | (63.1) |
Total sales | (55.5) | (63.1) |
Cost of products sold | (42.1) | (50.2) |
Gross profit | (13.4) | (12.9) |
Selling, distribution, and administrative expenses | (13.4) | (12.9) |
Intercompany charges | 0 | 0 |
Special charge | 0 | 0 |
Operating profit | 0 | 0 |
Interest expense, net | 0 | 0 |
Equity earnings in subsidiaries | 82 | 99.3 |
Miscellaneous expense (income), net | 0 | 0 |
Income before provision for income taxes | (82) | (99.3) |
(Benefit) provision for income taxes | 0 | 0 |
Net income | (82) | (99.3) |
Other comprehensive income (loss) items: | ||
Foreign currency translation adjustments | 10.5 | 11.9 |
Defined benefit pension plans, net | (1.6) | (1.4) |
Other comprehensive loss, net of tax | 8.9 | 10.5 |
Comprehensive income | $ (73.1) | $ (88.8) |
Supplemental Guarantor Conden51
Supplemental Guarantor Condensed Consolidating Financial Statements (Cash Flows) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Nov. 30, 2017 | Nov. 30, 2016 | |
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | $ 139.8 | $ 55.8 |
Cash flows from investing activities: | ||
Purchases of property, plant, and equipment | (10.3) | (19.5) |
Proceeds from sale of property, plant, and equipment | 0 | 5.4 |
Proceeds from sale of investment | 0 | 13 |
Net cash used for investing activities | (10.3) | (1.1) |
Cash flows from financing activities: | ||
Repayments of long-term debt | (0.1) | 0 |
Issuance of long-term debt | 0 | 0.9 |
Proceeds from stock option exercises and other | 0.8 | 2.1 |
Repurchases of common stock | 0 | (0.4) |
Employee taxes on net settlement of equity awards | (6) | (11.3) |
Dividends paid | (5.5) | (5.8) |
Net cash used for financing activities | (10.8) | (14.5) |
Effect of exchange rates changes on cash | (1.2) | (2.2) |
Net change in cash and cash equivalents | 117.5 | 38 |
Cash and cash equivalents at beginning of period | 311.1 | 413.2 |
Cash and cash equivalents at end of period | 428.6 | 451.2 |
Parent | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | 137.8 | 36.5 |
Cash flows from investing activities: | ||
Purchases of property, plant, and equipment | 0 | 0 |
Proceeds from sale of property, plant, and equipment | 0 | |
Proceeds from sale of investment | 0 | |
Net cash used for investing activities | 0 | 0 |
Cash flows from financing activities: | ||
Repayments of long-term debt | 0 | |
Issuance of long-term debt | 0 | |
Proceeds from stock option exercises and other | 0.8 | 2.1 |
Repurchases of common stock | (0.4) | |
Employee taxes on net settlement of equity awards | (6) | (11.3) |
Dividends paid | (5.5) | (5.8) |
Net cash used for financing activities | (10.7) | (15.4) |
Effect of exchange rates changes on cash | 0 | 0 |
Net change in cash and cash equivalents | 127.1 | 21.1 |
Cash and cash equivalents at beginning of period | 237.7 | 368.2 |
Cash and cash equivalents at end of period | 364.8 | 389.3 |
Subsidiary Issuer | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | 5.8 | 2.2 |
Cash flows from investing activities: | ||
Purchases of property, plant, and equipment | (7.2) | (16.5) |
Proceeds from sale of property, plant, and equipment | 0 | |
Proceeds from sale of investment | 13 | |
Net cash used for investing activities | (7.2) | (3.5) |
Cash flows from financing activities: | ||
Repayments of long-term debt | 0 | |
Issuance of long-term debt | 0 | |
Proceeds from stock option exercises and other | 0 | 0 |
Repurchases of common stock | 0 | |
Employee taxes on net settlement of equity awards | 0 | 0 |
Dividends paid | 0 | 0 |
Net cash used for financing activities | 0 | 0 |
Effect of exchange rates changes on cash | 1.4 | 1.3 |
Net change in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents at beginning of period | 0 | 0 |
Cash and cash equivalents at end of period | 0 | 0 |
Subsidiary Guarantor | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | 0 | 0 |
Cash flows from investing activities: | ||
Purchases of property, plant, and equipment | 0 | 0 |
Proceeds from sale of property, plant, and equipment | 0 | |
Proceeds from sale of investment | 0 | |
Net cash used for investing activities | 0 | 0 |
Cash flows from financing activities: | ||
Repayments of long-term debt | 0 | |
Issuance of long-term debt | 0 | |
Proceeds from stock option exercises and other | 0 | 0 |
Repurchases of common stock | 0 | |
Employee taxes on net settlement of equity awards | 0 | 0 |
Dividends paid | 0 | 0 |
Net cash used for financing activities | 0 | 0 |
Effect of exchange rates changes on cash | 0 | 0 |
Net change in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents at beginning of period | 0 | 0 |
Cash and cash equivalents at end of period | 0 | 0 |
Non- Guarantors | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | (3.8) | 17.1 |
Cash flows from investing activities: | ||
Purchases of property, plant, and equipment | (3.1) | (3) |
Proceeds from sale of property, plant, and equipment | 5.4 | |
Proceeds from sale of investment | 0 | |
Net cash used for investing activities | (3.1) | 2.4 |
Cash flows from financing activities: | ||
Repayments of long-term debt | (0.1) | |
Issuance of long-term debt | 0.9 | |
Proceeds from stock option exercises and other | 0 | 0 |
Repurchases of common stock | 0 | |
Employee taxes on net settlement of equity awards | 0 | 0 |
Dividends paid | 0 | 0 |
Net cash used for financing activities | (0.1) | 0.9 |
Effect of exchange rates changes on cash | (2.6) | (3.5) |
Net change in cash and cash equivalents | (9.6) | 16.9 |
Cash and cash equivalents at beginning of period | 73.4 | 45 |
Cash and cash equivalents at end of period | 63.8 | 61.9 |
Consolidating Adjustments | ||
Condensed Financial Statements, Captions [Line Items] | ||
Net cash provided by operating activities | 0 | 0 |
Cash flows from investing activities: | ||
Purchases of property, plant, and equipment | 0 | 0 |
Proceeds from sale of property, plant, and equipment | 0 | |
Proceeds from sale of investment | 0 | |
Net cash used for investing activities | 0 | 0 |
Cash flows from financing activities: | ||
Repayments of long-term debt | 0 | |
Issuance of long-term debt | 0 | |
Proceeds from stock option exercises and other | 0 | 0 |
Repurchases of common stock | 0 | |
Employee taxes on net settlement of equity awards | 0 | 0 |
Dividends paid | 0 | 0 |
Net cash used for financing activities | 0 | 0 |
Effect of exchange rates changes on cash | 0 | 0 |
Net change in cash and cash equivalents | 0 | 0 |
Cash and cash equivalents at beginning of period | 0 | 0 |
Cash and cash equivalents at end of period | $ 0 | $ 0 |