Cover Page
Cover Page | 3 Months Ended |
Mar. 31, 2020shares | |
Cover [Abstract] | |
Entity Current Reporting Status | Yes |
Security Exchange Name | NYSE |
Entity Registrant Name | Pentair plc |
Title of 12(b) Security | Ordinary Shares, nominal value $0.01 per share |
Entity Incorporation, State or Country Code | L2 |
Document Transition Report | false |
Document Quarterly Report | true |
Entity Central Index Key | 0000077360 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Entity Emerging Growth Company | false |
Entity Small Business | false |
Document Type | 10-Q |
Entity File Number | 001-11625 |
Document Period End Date | Mar. 31, 2020 |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
Trading Symbol | PNR |
Entity Common Stock, Shares Outstanding | 165,725,188 |
Entity Tax Identification Number | 98-1141328 |
City Area Code | 74 |
Local Phone Number | 9421-6154 |
Entity Interactive Data Current | Yes |
Entity Shell Company | false |
Country Region | 44 |
Entity Address, Address Line One | Regal House, 70 London Road, |
Entity Address, Address Line Two | Twickenham, |
Entity Address, City or Town | London, |
Entity Address, Country | GB |
Entity Address, Postal Zip Code | TW13QS |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||
Net sales | $ 710 | $ 688.9 |
Cost of goods sold | 458.4 | 453.3 |
Gross profit | 251.6 | 235.6 |
Selling, general and administrative expenses | 131.9 | 147.3 |
Research and development expenses | 19 | 20.7 |
Operating income | 100.7 | 67.6 |
Other (income) expense: | ||
Gain on sale of businesses | 0 | (3.5) |
Net interest expense | 6.9 | 7.3 |
Other expense | 1.2 | 0.6 |
Income from continuing operations before income taxes | 92.6 | 63.2 |
Provision for income taxes | 19.9 | 10.8 |
Net income from continuing operations | 72.7 | 52.4 |
Loss from discontinued operations, net of tax | 0 | (1.1) |
Net income | 72.7 | 51.3 |
Comprehensive income, net of tax | ||
Net income | 72.7 | 51.3 |
Changes in cumulative translation adjustment | (37.8) | (1.6) |
Changes in market value of derivative financial instruments, net of tax | 39.1 | 4.3 |
Comprehensive income | $ 74 | $ 54 |
Basic | ||
Continuing operations (in dollars per share) | $ 0.43 | $ 0.31 |
Discontinued operations (in dollars per share) | 0 | (0.01) |
Basic earnings (loss) per ordinary share (in dollars per share) | 0.43 | 0.30 |
Diluted | ||
Continuing operations (in dollars per share) | 0.43 | 0.30 |
Discontinued operations (in dollars per share) | 0 | 0 |
Diluted earnings (loss) per ordinary share (in dollars per share) | $ 0.43 | $ 0.30 |
Weighted average ordinary shares outstanding | ||
Basic (shares) | 167.8 | 171.6 |
Diluted (shares) | 168.7 | 172.5 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets | ||
Cash and cash equivalents | $ 169.3 | $ 82.5 |
Accounts and notes receivable, net of allowances of $8.6 and $10.3, respectively | 665 | 502.9 |
Inventories | 392.4 | 377.4 |
Other current assets | 112.9 | 99.1 |
Total current assets | 1,339.6 | 1,061.9 |
Property, plant and equipment, net | 280.7 | 283.2 |
Other assets | ||
Goodwill | 2,256.8 | 2,258.3 |
Intangibles, net | 326.5 | 339.2 |
Other non-current assets | 223.1 | 196.9 |
Total other assets | 2,806.4 | 2,794.4 |
Total assets | 4,426.7 | 4,139.5 |
Current liabilities | ||
Accounts payable | 268.2 | 325.1 |
Employee compensation and benefits | 68 | 71 |
Other current liabilities | 346.6 | 352.9 |
Total current liabilities | 682.8 | 749 |
Other liabilities | ||
Long-term debt | 1,450.5 | 1,029.1 |
Pension and other post-retirement compensation and benefits | 95.7 | 96.4 |
Deferred tax liabilities | 114.5 | 104.4 |
Other non-current liabilities | 190.7 | 206.7 |
Total liabilities | 2,534.2 | 2,185.6 |
Equity | ||
Ordinary shares $0.01 par value, 426.0 authorized, 165.7 and 168.3 issued at March 31, 2020 and December 31, 2019, respectively | 1.7 | 1.7 |
Additional paid-in capital | 1,673.9 | 1,777.7 |
Retained earnings | 442.1 | 401 |
Accumulated other comprehensive loss | (225.2) | (226.5) |
Total equity | 1,892.5 | 1,953.9 |
Total liabilities and equity | $ 4,426.7 | $ 4,139.5 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts and notes receivable, allowances | $ 8.6 | $ 10.3 |
Ordinary shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock authorized (in shares) | 426,000,000 | 426,000,000 |
Common shares issued (in shares) | 165,700,000 | 168,300,000 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating activities | ||
Net income | $ 72.7 | $ 51.3 |
Loss from discontinued operations, net of tax | 0 | 1.1 |
Adjustments to reconcile net income from continuing operations to net cash provided by (used for) operating activities of continuing operations | ||
Equity loss (income) of unconsolidated subsidiaries | 0.5 | (0.6) |
Depreciation | 11.6 | 12 |
Amortization | 7.6 | 8.2 |
Deferred income taxes | 14 | (1.7) |
Gain on sale of businesses | 0 | (3.5) |
Share-based compensation | 6.2 | 5.4 |
Asset impairment | 0 | 15.3 |
Changes in assets and liabilities, net of effects of business acquisitions | ||
Accounts receivable | (167.1) | (154) |
Inventories | (20.1) | (22.2) |
Other current assets | (13.4) | (22.5) |
Accounts payable | (49.9) | (118.2) |
Employee compensation and benefits | (0.8) | (18.9) |
Other current liabilities | (22.3) | (8.3) |
Other non-current assets and liabilities | (1.4) | (0.5) |
Net cash used for operating activities of continuing operations | (162.4) | (257.1) |
Net cash provided by operating activities of discontinued operations | 0 | 0.8 |
Net cash used for operating activities | (162.4) | (256.3) |
Investing activities | ||
Capital expenditures | (18.7) | (16.8) |
Proceeds from sale of property and equipment | 0.1 | 0.3 |
Proceeds from the sale of businesses, net | 0 | 0.7 |
Acquisitions, net of cash acquired | (7.2) | (287.2) |
Other | 0 | (1.5) |
Net cash used for investing activities | (25.8) | (304.5) |
Financing activities | ||
Net receipts of commercial paper and revolving long-term debt | 420.9 | 584.1 |
Shares issued to employees, net of shares withheld | 5.2 | 5.9 |
Repurchases of ordinary shares | (115.2) | 0 |
Dividends paid | (32.1) | (31) |
Net cash provided by financing activities | 278.8 | 559 |
Effect of exchange rate changes on cash and cash equivalents | (3.8) | 6.4 |
Change in cash and cash equivalents | 86.8 | 4.6 |
Cash and cash equivalents, beginning of period | 82.5 | 74.3 |
Cash and cash equivalents, end of period | $ 169.3 | $ 78.9 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Equity - USD ($) shares in Millions, $ in Millions | Total | Ordinary shares | Additional paid-in capital | Retained earnings | Accumulated other comprehensive loss |
Cash dividends declared per ordinary share | $ 0.18 | ||||
Beginning Balance (in shares) at Dec. 31, 2018 | 171.4 | ||||
Beginning Balance at Dec. 31, 2018 | $ 1,836.1 | $ 1.7 | $ 1,893.8 | $ 169.2 | $ (228.6) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 51.3 | 51.3 | |||
Other comprehensive income, net of tax | 2.7 | 2.7 | |||
Dividends declared | (31) | (31) | |||
Exercise of options, net of shares tendered for payment (in shares) | 0.3 | ||||
Exercise of options, net of shares tendered for payment | 9.1 | 9.1 | |||
Issuance of restricted shares, net of cancellations (in shares) | 0.2 | ||||
Issuance of restricted shares, net of cancellations | 0 | ||||
Shares surrendered by employees to pay taxes | (3.2) | (3.2) | |||
Share-based compensation | 5.4 | 5.4 | |||
Ending Balance (in shares) at Mar. 31, 2019 | 171.9 | ||||
Ending Balance at Mar. 31, 2019 | $ 1,870.4 | $ 1.7 | 1,905.1 | 189.5 | (225.9) |
Cash dividends declared per ordinary share | $ 0.19 | ||||
Beginning Balance (in shares) at Dec. 31, 2019 | 168.3 | ||||
Beginning Balance at Dec. 31, 2019 | $ 1,953.9 | $ 1.7 | 1,777.7 | 401 | (226.5) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 72.7 | 72.7 | |||
Other comprehensive income, net of tax | 1.3 | 1.3 | |||
Dividends declared | (31.6) | (31.6) | |||
Share repurchases | (115.2) | (115.2) | |||
Exercise of options, net of shares tendered for payment (in shares) | 0.3 | ||||
Exercise of options, net of shares tendered for payment | 8.8 | 8.8 | |||
Issuance of restricted shares, net of cancellations (in shares) | 0.2 | ||||
Issuance of restricted shares, net of cancellations | 0 | ||||
Shares surrendered by employees to pay taxes (in shares) | (0.1) | ||||
Shares surrendered by employees to pay taxes | (3.6) | (3.6) | |||
Share-based compensation | 6.2 | 6.2 | |||
Ending Balance (in shares) at Mar. 31, 2020 | 165.7 | ||||
Ending Balance at Mar. 31, 2020 | $ 1,892.5 | $ 1.7 | $ 1,673.9 | $ 442.1 | $ (225.2) |
Basis of Presentation and Respo
Basis of Presentation and Responsibility for Interim Financial Statements | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Responsibility for Interim Financial Statements | Basis of Presentation and Responsibility for Interim Financial Statements The accompanying unaudited condensed consolidated financial statements of Pentair plc and its subsidiaries (“we,” “us,” “our,” “Pentair,” or the “Company”) have been prepared following the requirements of the U.S. Securities and Exchange Commission (“SEC”) for interim reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by accounting principles generally accepted in the United States of America (“GAAP”) can be condensed or omitted. We are responsible for the unaudited condensed consolidated financial statements included in this document. The financial statements include all normal recurring adjustments that are considered necessary for the fair presentation of our financial position and operating results. As these are condensed financial statements, one should also read our consolidated financial statements and notes thereto, which are included in our Annual Report on Form 10-K for the year ended December 31, 2019 . Revenues, expenses, cash flows, assets and liabilities can and do vary during each quarter of the year. Therefore, the results and trends in these interim financial statements may not be indicative of those for a full year. In March 2020, the World Health Organization declared the novel coronavirus 2019 (“COVID-19”) a global pandemic. The broader implications of the COVID-19 pandemic on our business, financial condition and results of operations remain uncertain and will depend on certain developments, including the duration and severity of the COVID-19 pandemic, its impact on our customers and suppliers and the range of governmental and community reactions to the pandemic. We may experience reduced customer demand or constrained supply that could materially adversely impact our business, financial condition, results of operations, liquidity and cash flows in future periods. Our fiscal year ends on December 31. We report our interim quarterly periods on a calendar quarter basis. Adoption of new accounting standards On January 1, 2020, we adopted Accounting Standards Update No. 2016-13 “Financial Instruments-Credit Losses” and the related amendments (the “new standard”). The new standard changes the methodology used to measure credit losses for certain financial instruments and financial assets, including trade receivables. The approach utilizes an expected credit loss model that requires consideration of a broader range of information to estimate expected credit losses over the lifetime of an asset, which may result in earlier recognition of credit losses than under the previous accounting standards. Under the new standard, we record an allowance for credit losses, reducing our trade receivables balance to an amount we estimate is collectible from our customers. The estimates used in determining the allowance for credit losses are based on historical collection experience, including write-offs and recoveries, periodic credit evaluations of our customers’ financial situation, and current circumstances as well as reasonable and supportable forecasts of future economic conditions. The adoption of this new standard did not have a material impact on our consolidated financial statements. The following table summarizes the activity in the allowance for credit losses: In millions March 31, Beginning balance $ 10.3 Bad debt expense (1.1 ) Write-offs, net of recoveries (0.3 ) Other (1) (0.3 ) Ending balance $ 8.6 (1) Other amounts are primarily the effects of changes in currency translations and the impact of allowance for credits. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue We disaggregate our revenue from contracts with customers by segment, geographic location and vertical, as we believe these best depict how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Refer to Note 14 for revenue disaggregated by segment. Geographic net sales information, based on geographic destination of the sale, was as follows: Three months ended In millions March 31, March 31, U.S. $ 464.0 $ 426.0 Western Europe 103.8 104.3 Developing (1) 94.5 108.9 Other Developed (2) 47.7 49.7 Consolidated net sales $ 710.0 $ 688.9 (1) Developing includes China, Eastern Europe, Latin America, the Middle East and Southeast Asia. (2) Other Developed includes Australia, Canada and Japan. Vertical net sales information was as follows: Three months ended In millions March 31, March 31, Residential $ 415.8 $ 383.6 Commercial 141.4 150.7 Industrial 152.8 154.6 Consolidated net sales $ 710.0 $ 688.9 Performance obligations On March 31, 2020 , we had $50.4 million of remaining performance obligations on contracts with an original expected duration of one year or more. We expect to recognize the majority of our remaining performance obligations on these contracts within the next 12 to 18 months . Contract assets and liabilities Contract assets and liabilities consisted of the following: In millions March 31, December 31, $ Change % Change Contract assets $ 45.5 $ 41.0 $ 4.5 11.0 % Contract liabilities 30.4 32.6 (2.2 ) (6.7 )% Net contract assets $ 15.1 $ 8.4 $ 6.7 79.8 % The $6.7 million increase in net contract assets from December 31, 2019 to March 31, 2020 was primarily the result of timing of milestone payments and impact of foreign currency fluctuations. Approximately 45% of our contract liabilities at December 31, 2019 were recognized in revenue in the first quarter of 2020 . There were no impairment losses recognized on our contract assets for the three months ended March 31, 2020 . |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisitions | Acquisitions In February 2019, as part of Consumer Solutions, we completed the acquisitions of Aquion, Inc. (“Aquion”) and Pelican Water Systems (“Pelican”) for $163.4 million and $121.1 million , respectively, in cash, net of cash acquired and final working capital true-ups. For Aquion, the excess of purchase price over tangible net assets and identified intangible assets acquired has been allocated to goodwill in the amount of $101.9 million , $4.6 million of which is expected to be deductible for income tax purposes. Identifiable intangible assets acquired as part of the Aquion acquisition include $15.7 million of indefinite-lived trade name intangible assets and $78.8 million of definite-lived customer relationships with an estimated useful life of 15 years . For Pelican, the excess purchase price over tangible net assets acquired has been allocated to goodwill in the amount of $118.0 million , $7.6 million of which is expected to be deductible for income tax purposes. The proforma impact of these acquisitions is not material. |
Share Plans
Share Plans | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share Plans | Share Plans Total share-based compensation expense for the three months ended March 31, 2020 and 2019 was as follows: Three months ended In millions March 31, March 31, Restricted stock units $ 3.2 $ 2.8 Stock options 1.0 1.4 Performance share units 2.0 1.2 Total share-based compensation expense $ 6.2 $ 5.4 In the first quarter of 2020, we issued our annual share-based compensation grants under the Pentair plc 2012 Stock and Incentive Plan to eligible employees. The total number of awards issued was approximately 0.8 million , of which 0.3 million were restricted stock units (“RSUs”), 0.4 million were stock options and 0.1 million were performance share units (“PSUs”). The weighted-average grant date fair value of the RSUs, stock options and PSUs issued was $42.77 , $9.58 , and $45.40 , respectively. We estimated the fair value of each stock option award issued in the annual share-based compensation grant using a Black-Scholes option pricing model, modified for dividends and using the following assumptions: 2020 Annual Grant Risk-free interest rate 1.61 % Expected dividend yield 1.80 % Expected share price volatility 24.1 % Expected term (years) 6.8 These estimates require us to make assumptions based on historical results, observance of trends in our share price, changes in option exercise behavior, future expectations and other relevant factors. If other assumptions had been used, share-based compensation expense, as calculated and recorded under the accounting guidance, could have been affected. We based the expected life assumption on historical experience as well as the terms and vesting periods of the options granted. For purposes of determining expected share price volatility, we considered a rolling average of historical volatility measured over a period approximately equal to the expected option term. The risk-free interest rate for periods that coincide with the expected life of the options is based on the U.S. Treasury Department yield curve in effect at the time of grant. |
Share-based Compensation Expense | Total share-based compensation expense for the three months ended March 31, 2020 and 2019 was as follows: Three months ended In millions March 31, March 31, Restricted stock units $ 3.2 $ 2.8 Stock options 1.0 1.4 Performance share units 2.0 1.2 Total share-based compensation expense $ 6.2 $ 5.4 |
Restructuring
Restructuring | 3 Months Ended |
Mar. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring During the three months ended March 31, 2020 and the year ended December 31, 2019 , we initiated and continued execution of certain business restructuring initiatives aimed at reducing our fixed cost structure and realigning our business, including the reduction in headcount of approximately 75 employees and 375 employees, respectively. Restructuring-related costs within Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income included the following: Three months ended In millions March 31, March 31, Severance and related costs $ 2.7 $ 1.1 Total restructuring costs $ 2.7 $ 1.1 Restructuring costs by reportable segment were as follows: Three months ended In millions March 31, March 31, Consumer Solutions $ 0.6 $ 1.1 Industrial & Flow Technologies 0.9 (0.1 ) Other 1.2 0.1 Consolidated $ 2.7 $ 1.1 Activity related to accrued severance and related costs recorded in Other current liabilities in the Condensed Consolidated Balance Sheets is summarized as follows for the three months ended March 31, 2020 : In millions March 31, Beginning balance $ 16.2 Costs incurred 2.7 Cash payments and other (4.7 ) Ending balance $ 14.2 |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic and diluted earnings per share were calculated as follows: Three months ended In millions, except per-share data March 31, March 31, Net income $ 72.7 $ 51.3 Net income from continuing operations $ 72.7 $ 52.4 Weighted average ordinary shares outstanding Basic 167.8 171.6 Dilutive impact of stock options, restricted stock units and performance share units 0.9 0.9 Diluted 168.7 172.5 Earnings (loss) per ordinary share Basic Continuing operations $ 0.43 $ 0.31 Discontinued operations — (0.01 ) Basic earnings per ordinary share $ 0.43 $ 0.30 Diluted Continuing operations $ 0.43 $ 0.30 Discontinued operations — — Diluted earnings per ordinary share $ 0.43 $ 0.30 Anti-dilutive stock options excluded from the calculation of diluted earnings per share 2.0 1.7 |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Supplemental Balance Sheet Information [Abstract] | |
Supplemental Balance Sheet Information | Supplemental Balance Sheet Information In millions March 31, December 31, Inventories Raw materials and supplies $ 201.0 $ 196.2 Work-in-process 66.3 65.2 Finished goods 125.1 116.0 Total inventories $ 392.4 $ 377.4 Other current assets Cost in excess of billings $ 45.5 $ 41.0 Prepaid expenses 55.8 48.3 Prepaid income taxes 7.8 5.2 Other current assets 3.8 4.6 Total other current assets $ 112.9 $ 99.1 Property, plant and equipment, net Land and land improvements $ 32.7 $ 33.7 Buildings and leasehold improvements 184.3 188.1 Machinery and equipment 537.9 537.2 Capitalized software 73.1 73.5 Construction in progress 53.4 48.1 Total property, plant and equipment 881.4 880.6 Accumulated depreciation and amortization 600.7 597.4 Total property, plant and equipment, net $ 280.7 $ 283.2 Other non-current assets Right-of-use lease assets $ 81.1 $ 77.2 Deferred income taxes 28.5 29.6 Deferred compensation plan assets 15.7 21.3 Foreign currency contract assets 32.8 0.1 Other non-current assets 65.0 68.7 Total other non-current assets $ 223.1 $ 196.9 Other current liabilities Dividends payable $ 31.5 $ 32.0 Accrued warranty 36.5 32.1 Accrued rebates and incentives 76.5 83.5 Billings in excess of cost 19.5 22.5 Current lease liability 18.8 19.0 Income taxes payable 4.3 11.1 Accrued restructuring 14.2 16.2 Other current liabilities 145.3 136.5 Total other current liabilities $ 346.6 $ 352.9 Other non-current liabilities Long-term lease liability $ 64.2 $ 61.1 Income taxes payable 45.5 45.4 Self-insurance liabilities 39.7 41.6 Deferred compensation plan liabilities 15.7 21.3 Foreign currency contract liabilities — 11.6 Other non-current liabilities 25.6 25.7 Total other non-current liabilities $ 190.7 $ 206.7 |
Goodwill and Other Identifiable
Goodwill and Other Identifiable Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Identifiable Intangible Assets | Goodwill and Other Identifiable Intangible Assets The changes in the carrying amount of goodwill by reportable segment were as follows: In millions December 31, Purchase Accounting Adjustments Acquisitions Foreign currency translation/other March 31, Consumer Solutions $ 1,501.4 $ 14.4 $ 6.3 $ (2.9 ) $ 1,519.2 Industrial & Flow Technologies 756.9 — — (19.3 ) 737.6 Total goodwill $ 2,258.3 $ 14.4 $ 6.3 $ (22.2 ) $ 2,256.8 Identifiable intangible assets consisted of the following: March 31, December 31, In millions Cost Accumulated amortization Net Cost Accumulated amortization Net Definite-life intangibles Customer relationships $ 410.3 $ (271.4 ) $ 138.9 $ 418.1 $ (269.1 ) $ 149.0 Proprietary technology and patents 41.7 (25.7 ) 16.0 42.3 (25.5 ) 16.8 Total definite-life intangibles 452.0 (297.1 ) 154.9 460.4 (294.6 ) 165.8 Indefinite-life intangibles Trade names 171.6 — 171.6 173.4 — 173.4 Total intangibles $ 623.6 $ (297.1 ) $ 326.5 $ 633.8 $ (294.6 ) $ 339.2 Identifiable intangible asset amortization expense was $7.6 million and $8.2 million for the three months ended March 31, 2020 and 2019 , respectively. Estimated future amortization expense for identifiable intangible assets during the remainder of 2020 and the next five years is as follows: Q2-Q4 In millions 2020 2021 2022 2023 2024 2025 Estimated amortization expense $ 19.6 $ 22.0 $ 15.4 $ 12.8 $ 12.3 $ 12.3 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt and the average interest rates on debt outstanding were as follows: In millions Average interest rate as of March 31, 2020 Maturity Year March 31, December 31, Commercial paper 2.097% 2023 $ — $ 117.8 Revolving credit facilities 2.069% 2023 574.5 35.8 Term loans (1) 2.696% 2023 200.0 200.0 Senior notes - fixed rate (1) 3.625% 2020 74.0 74.0 Senior notes - fixed rate (1) 5.000% 2021 103.8 103.8 Senior notes - fixed rate (1) 3.150% 2022 88.3 88.3 Senior notes - fixed rate (1) 4.650% 2025 19.3 19.3 Senior notes - fixed rate (1) 4.500% 2029 400.0 400.0 Unamortized debt issuance costs and discounts N/A N/A (9.4 ) (9.9 ) Total debt $ 1,450.5 $ 1,029.1 (1) Senior notes (“the Notes”) and the term loans are guaranteed as to payment by Pentair plc and PISG In April 2018, Pentair, Pentair Investments Switzerland GmbH (“PISG”), Pentair Finance S.à r.l (“PFSA“) and Pentair, Inc. entered into a credit agreement, providing for an $800.0 million senior unsecured revolving credit facility with a term of five years (the “Senior Credit Facility”), with Pentair and PISG as guarantors and PFSA and Pentair, Inc. as borrowers. The Senior Credit Facility has a maturity date of April 25, 2023. Borrowings under the Senior Credit Facility bear interest at a rate equal to an adjusted base rate or the London Interbank Offered Rate, plus, in each case, an applicable margin. The applicable margin is based on, at PFSA’s election, Pentair’s leverage level or PFSA’s public credit rating. In May 2019, PFSA executed an increase of the Senior Credit Facility by $100.0 million for a total commitment up to $900.0 million in the aggregate. In December 2019, the Senior Credit Facility was amended to provide for the extension of term loans in an aggregate amount of $200.0 million (the “Term Loans”). The Term Loans are in addition to the Senior Credit Facility commitment. In addition, PFSA has the option to further increase the Senior Credit Facility in an aggregate amount of up to $300.0 million , through a combination of increases to the total commitment amount of the Senior Credit Facility and/or one or more tranches of term loans in addition to the Term Loans, subject to customary conditions, including the commitment of the participating lenders. PFSA is authorized to sell short-term commercial paper notes to the extent availability exists under the Senior Credit Facility. PFSA uses the Senior Credit Facility as back-up liquidity to support 100% of commercial paper outstanding. PFSA had no commercial paper outstanding as of March 31, 2020 and $117.8 million as of December 31, 2019 , all of which was classified as long-term debt as we have the intent and the ability to refinance such obligations on a long-term basis under the Senior Credit Facility. In March 2020, the commercial paper market began to experience high levels of volatility due to COVID-19 related uncertainty. The volatility impacted both market access to and pricing of commercial paper. As a result, we borrowed under the Senior Credit Facility and used the proceeds to pay off the remaining commercial paper and fund general operational needs. As of March 31, 2020 , total availability under the Senior Credit Facility was $325.5 million . Our debt agreements contain various financial covenants, but the most restrictive covenants are contained in the Senior Credit Facility. The Senior Credit Facility contains covenants requiring us not to permit (i) the ratio of our consolidated debt (net of our consolidated unrestricted cash in excess of $5.0 million but not to exceed $250.0 million ) to our consolidated net income (excluding, among other things, non-cash gains and losses) before interest, taxes, depreciation, amortization and non-cash share-based compensation expense (“EBITDA”) on the last day of any period of four consecutive fiscal quarters to exceed 3.75 to 1.00 (the “Leverage Ratio”) and (ii) the ratio of our EBITDA to our consolidated interest expense, for the same period to be less than 3.00 to 1.00 as of the end of each fiscal quarter. For purposes of the Leverage Ratio, the Senior Credit Facility provides for the calculation of EBITDA giving pro forma effect to certain acquisitions, divestitures and liquidations during the period to which such calculation relates. In addition to the Senior Credit Facility, we have various other credit facilities with an aggregate availability of $20.9 million , of which there were no outstanding borrowings at March 31, 2020 . Borrowings under these credit facilities bear interest at variable rates. We have $74.0 million aggregate principal amount of fixed rate senior notes maturing in the next twelve months. We classified this debt as long-term as of March 31, 2020 as we have the intent and ability to refinance such obligation on a long-term basis under the Senior Credit Facility. Debt outstanding, excluding unamortized issuance costs and discounts, at March 31, 2020 matures on a calendar year basis as follows: Q2-Q4 In millions 2020 2021 2022 2023 2024 2025 Thereafter Total Contractual debt obligation maturities $ 74.0 $ 103.8 $ 88.3 $ 774.5 $ — $ 19.3 $ 400.0 $ 1,459.9 |
Derivatives and Financial Instr
Derivatives and Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and Financial Instruments | Derivatives and Financial Instruments Derivative financial instruments We are exposed to market risk related to changes in foreign currency exchange rates. To manage the volatility related to this exposure, we periodically enter into a variety of derivative financial instruments. Our objective is to reduce, where it is deemed appropriate to do so, fluctuations in earnings and cash flows associated with changes in foreign currency exchange rates. The derivative contracts contain credit risk to the extent that our bank counterparties may be unable to meet the terms of the agreements. The amount of such credit risk is generally limited to the unrealized gains, if any, in such contracts. Such risk is minimized by limiting those counterparties to major financial institutions of high credit quality. Foreign currency contracts We conduct business in various locations throughout the world and are subject to market risk due to changes in the value of foreign currencies in relation to our reporting currency, the U.S. dollar. We manage our economic and transaction exposure to certain market-based risks through the use of foreign currency derivative financial instruments. Our objective in holding these derivatives is to reduce the volatility of net earnings and cash flows associated with changes in foreign currency exchange rates. The majority of our foreign currency contracts have an original maturity date of less than one year. At March 31, 2020 and December 31, 2019 , we had outstanding foreign currency derivative contracts with gross notional U.S. dollar equivalent amounts of $5.8 million and $17.0 million , respectively. The impact of these contracts on the Condensed Consolidated Statements of Operations and Comprehensive Income was not material for any period presented. Cross Currency Swaps At March 31, 2020 and December 31, 2019 , we had outstanding cross currency swap agreements with a combined notional amount of $761.7 million and $770.0 million , respectively. The agreements are accounted for as either cash flow hedges, to hedge foreign currency fluctuations on certain intercompany debt, or as net investment hedges to manage our exposure to fluctuations in the Euro-U.S. Dollar exchange rate. We had deferred foreign currency gains of $37.0 million and deferred currency losses of $1.8 million at March 31, 2020 and December 31, 2019 , respectively, in Accumulated other comprehensive loss associated with our cross currency swap activity. Fair value measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date: Level 1: Valuation is based on observable inputs such as quoted market prices (unadjusted) for identical assets or liabilities in active markets. Level 2: Valuation is based on inputs such as quoted market prices for similar assets or liabilities in active markets or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3: Valuation is based upon other unobservable inputs that are significant to the fair value measurement. In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. Fair value of financial instruments The following methods were used to estimate the fair values of each class of financial instruments: • short-term financial instruments (cash and cash equivalents, accounts and notes receivable, accounts and notes payable and variable-rate debt) — recorded amount approximates fair value because of the short maturity period; • long-term fixed-rate debt, including current maturities — fair value is based on market quotes available for issuance of debt with similar terms, which are inputs that are classified as Level 2 in the valuation hierarchy defined by the accounting guidance; • foreign currency contract agreements — fair values are determined through the use of models that consider various assumptions, including time value, yield curves, as well as other relevant economic measures, which are inputs that are classified as Level 2 in the valuation hierarchy defined by the accounting guidance; and • deferred compensation plan assets (mutual funds, common/collective trusts and cash equivalents for payment of certain non-qualified benefits for retired, terminated and active employees) — fair value of mutual funds and cash equivalents are based on quoted market prices in active markets that are classified as Level 1 in the valuation hierarchy defined by the accounting guidance; fair value of common/collective trusts are valued at net asset value (“NAV”), which is based on the fair value of the underlying securities owned by the fund and divided by the number of shares outstanding. The recorded amounts and estimated fair values of total debt, excluding unamortized issuance costs and discounts, were as follows: March 31, December 31, In millions Recorded Amount Fair Value Recorded Amount Fair Value Variable rate debt $ 774.5 $ 774.5 $ 353.6 $ 353.6 Fixed rate debt 685.4 714.0 685.4 732.2 Total debt $ 1,459.9 $ 1,488.5 $ 1,039.0 $ 1,085.8 Financial assets and liabilities measured at fair value on a recurring and nonrecurring basis were as follows: March 31, 2020 In millions Level 1 Level 2 Level 3 NAV Total Recurring fair value measurements Foreign currency contract assets $ — $ 32.8 $ — $ — $ 32.8 Deferred compensation plan assets 8.7 — — 7.0 15.7 Total recurring fair value measurements $ 8.7 $ 32.8 $ — $ 7.0 $ 48.5 December 31, 2019 In millions Level 1 Level 2 Level 3 NAV Total Recurring fair value measurements Foreign currency contract assets $ — $ 0.1 $ — $ — $ 0.1 Foreign currency contract liabilities — (11.6 ) — — (11.6 ) Deferred compensation plan assets 12.5 — — 8.8 21.3 Total recurring fair value measurements $ 12.5 $ (11.5 ) $ — $ 8.8 $ 9.8 Nonrecurring fair value measurements (1) (1) During the year ended December 31, 2019, we recorded impairment charges for cost method investments in the amount of $21.2 million , of which $15.3 million was recorded in the first quarter of 2019. A valuation method using unobservable inputs was utilized to determine the fair value. We wrote the balance of the cost method investments to zero. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We manage our affairs so that we are centrally managed and controlled in the United Kingdom (“U.K.”) and therefore have our tax residency in the U.K. The provision for income taxes consists of provisions for the U.K. and international income taxes. We operate in an international environment with operations in various locations outside the U.K. Accordingly, the consolidated income tax rate is a composite rate reflecting the earnings in the various locations and the applicable rates. The effective income tax rate for the three months ended March 31, 2020 was 21.5% , compared to 17.1% for the three months ended March 31, 2019 . We continue to actively pursue initiatives to reduce our effective tax rate. The tax rate in any quarter can be affected positively or negatively by adjustments that are required to be reported in the specific quarter of resolution. On March 27, 2020, the United States enacted the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) in response to the COVID-19 pandemic. The CARES Act contains numerous income tax provisions, such as relaxing limitations on the deductibility of interest and the ability to carryback net operating losses arising in taxable years from 2018 through 2020. The CARES Act provisions provided a positive cash benefit of $16.2 million , offset by base erosion and anti-abuse tax of $6.8 million related to 2019 that was recorded as a discrete tax item in the first quarter of 2020. The liability for uncertain tax positions was $47.5 million and $47.4 million at March 31, 2020 and December 31, 2019 , respectively. We record penalties and interest related to unrecognized tax benefits in Provision for income taxes and Net interest expense , respectively, on the Condensed Consolidated Statements of Operations and Comprehensive Income, which is consistent with our past practices. In April 2020, the Internal Revenue Service released final regulations as part of the Tax Cuts and Jobs Act of 2017 that place limitations on the deductibility of certain interest expense for U.S. tax purposes. These regulations are expected to create a discrete tax expense of approximately $14.1 million in the second quarter of 2020, as well as an increase to our 2020 annual effective tax rate of approximately 1% . |
Benefit Plans
Benefit Plans | 3 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Benefit Plans | Benefit Plans Components of net periodic benefit cost for our pension plans for the three months ended March 31, 2020 and 2019 were as follows: Three months ended In millions March 31, March 31, Service cost $ 0.8 $ 0.7 Interest cost 0.7 2.7 Expected return on plan assets (0.2 ) (1.7 ) Net periodic benefit cost $ 1.3 $ 1.7 Components of net periodic benefit cost for our other post-retirement plans for the three months ended March 31, 2020 and 2019 were not material. |
Shareholders' Equity
Shareholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Share repurchases In May 2018, the Board of Directors authorized the repurchase of our ordinary shares up to a maximum dollar limit of $750.0 million . The authorization expires on May 31, 2021 . During the three months ended March 31, 2020 , we repurchased 3.0 million of our shares for $115.2 million . As of March 31, 2020 , we had $134.7 million available for share repurchases under this authorization. In March 2020, to enhance our liquidity position in response to the COVID-19 pandemic, we elected to temporarily suspend share repurchases under our existing share repurchase program. The existing program remains authorized by the Board of Directors, and we may resume share repurchases in the future at any time, depending upon market conditions, our capital needs and other factors. Dividends payable On February 25, 2020 , the Board of Directors declared a quarterly cash dividend of $0.19 , payable on May 1, 2020 to shareholders of record at the close of business on April 17, 2020 . As a result, the balance of dividends payable included in Other current liabilities on our Condensed Consolidated Balance Sheets was $31.5 million at March 31, 2020 , compared to $32.0 million at December 31, 2019 |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Effective January 1, 2020, we reorganized our business segments to better support our organization with our strategies and to better align with our customer base, resulting in a change to our reporting segments. All prior period amounts related to the segment change have been retrospectively reclassified to conform to the new presentation. As part of this reorganization, the legacy Aquatic Systems, Flow Technologies, and Filtration Solutions segments were realigned into two reportable business segments: • Consumer Solutions — This segment designs, manufactures and sells energy-efficient residential and commercial pool equipment and accessories, and commercial and residential water treatment products and systems. Residential and commercial pool equipment and accessories include pumps, filters, heaters, lights, automatic controls, automatic cleaners, maintenance equipment and pool accessories. Water treatment products and systems include pressure tanks, control valves, activated carbon products, conventional filtration products, and point-of-entry and point-of-use systems. Applications for our pool business include residential and commercial pool maintenance, repair, renovation, service and construction. Our water treatment products and systems are used in residential whole home water filtration, drinking water filtration and water softening solutions in addition to commercial total water management and filtration in food service operations. The primary focus of this segment is business-to-consumer. • Industrial & Flow Technologies — This segment manufactures and sells a variety of fluid treatment and pump products and systems, including pressure vessels, gas recovery solutions, membrane bioreactors, wastewater reuse systems and advanced membrane filtration, separation systems, water disposal pumps, water supply pumps, fluid transfer pumps, turbine pumps, solid handling pumps, and agricultural spray nozzles, while serving the global residential, commercial and industrial markets. These products and systems are used in a range of applications, fluid delivery, ion exchange, desalination, food and beverage, separation technologies for the oil and gas industry, residential and municipal wells, water treatment, wastewater solids handling, pressure boosting, circulation and transfer, fire suppression, flood control, agricultural irrigation and crop spray. The primary focus of this segment is business-to-business. We evaluate performance based on net sales and segment income (loss) and use a variety of ratios to measure performance of our reporting segments. These results are not necessarily indicative of the results of operations that would have occurred had each segment been an independent, stand-alone entity during the periods presented. Segment income (loss) represents equity income of unconsolidated subsidiaries and operating income exclusive of intangible amortization, certain acquisition related expenses, costs of restructuring activities, impairments and other unusual non-operating items. Financial information by reportable segment is as follows: Three months ended In millions March 31, March 31, Net sales Consumer Solutions $ 388.8 $ 358.2 Industrial & Flow Technologies 320.9 330.3 Other 0.3 0.4 Consolidated $ 710.0 $ 688.9 Segment income (loss) Consumer Solutions $ 84.8 $ 75.2 Industrial & Flow Technologies 44.7 41.0 Other (18.0 ) (17.5 ) Consolidated $ 111.5 $ 98.7 The following table presents a reconciliation of consolidated segment income to consolidated income from continuing operations before income taxes: Three months ended In millions March 31, March 31, Segment income $ 111.5 $ 98.7 Deal-related costs and expenses (0.4 ) (4.2 ) Inventory step-up — (1.7 ) Restructuring and other (2.4 ) (1.1 ) Intangible amortization (7.6 ) (8.2 ) Asset impairment — (15.3 ) Gain on sale of businesses — 3.5 COVID-19 related costs and expenses (0.9 ) — Net interest expense (6.9 ) (7.3 ) Other expense (0.7 ) (1.2 ) Income from continuing operations before income taxes $ 92.6 $ 63.2 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies | Commitments and Contingencies Warranties and guarantees In connection with our disposition of businesses, product lines and assets, we often provide representations, warranties and indemnities to cover purchasers for various potential liabilities relating to the sold businesses, product lines and assets, such as unknown damages or liabilities relating to the assets and pre-closing tax, product liability, warranty, environmental, or other obligations. The subject matter, amounts and duration of any such indemnification obligations vary for each type of liability indemnified and may vary widely from transaction to transaction. Generally, the maximum obligations under such indemnifications are not explicitly stated and as a result, the overall amount of these obligations cannot be reasonably estimated due to their inchoate and unknown nature. Historically, we have not made significant payments for these indemnifications. We believe that if we were to incur a loss in any of these matters, the loss would not have a material adverse effect on our financial position, results of operations or cash flows. We recognize, at the inception of a guarantee, a liability for the fair value of the obligation undertaken in issuing the guarantee. We provide service and warranty policies on our products. Liability under service and warranty policies is based upon a review of historical warranty and service claim experience. Adjustments are made to accruals as claim data and historical experience warrant. The changes in the carrying amount of service and product warranties of continuing operations for the three months ended March 31, 2020 were as follows: In millions March 31, Beginning balance $ 32.1 Service and product warranty provision 16.3 Payments (11.5 ) Foreign currency translation (0.4 ) Ending balance $ 36.5 Stand-by letters of credit, bank guarantees and bonds In certain situations, Tyco International Ltd., Pentair Ltd.’s former parent company (“Tyco”), guaranteed performance by the flow control business of Pentair Ltd. (“Flow Control”) to third parties or provided financial guarantees for financial commitments of Flow Control. In situations where Flow Control and Tyco were unable to obtain a release from these guarantees in connection with the spin-off of Flow Control from Tyco, we will indemnify Tyco for any losses it suffers as a result of such guarantees. In the ordinary course of business, we are required to commit to bonds, letters of credit and bank guarantees that require payments to our customers for any non-performance. The outstanding face value of these instruments fluctuates with the value of our projects in process and in our backlog. In addition, we issue financial stand-by letters of credit primarily to secure our performance to third parties under self-insurance programs. As of March 31, 2020 and December 31, 2019 , the outstanding value of bonds, letters of credit and bank guarantees totaled $89.3 million and $91.3 million , respectively. |
Basis of Presentation and Res_2
Basis of Presentation and Responsibility for Interim Financial Statements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Allowance for Credit Losses | The following table summarizes the activity in the allowance for credit losses: In millions March 31, Beginning balance $ 10.3 Bad debt expense (1.1 ) Write-offs, net of recoveries (0.3 ) Other (1) (0.3 ) Ending balance $ 8.6 (1) Other amounts are primarily the effects of changes in currency translations and the impact of allowance for credits. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Disaggregation of Revenue | Geographic net sales information, based on geographic destination of the sale, was as follows: Three months ended In millions March 31, March 31, U.S. $ 464.0 $ 426.0 Western Europe 103.8 104.3 Developing (1) 94.5 108.9 Other Developed (2) 47.7 49.7 Consolidated net sales $ 710.0 $ 688.9 (1) Developing includes China, Eastern Europe, Latin America, the Middle East and Southeast Asia. (2) Other Developed includes Australia, Canada and Japan. Vertical net sales information was as follows: Three months ended In millions March 31, March 31, Residential $ 415.8 $ 383.6 Commercial 141.4 150.7 Industrial 152.8 154.6 Consolidated net sales $ 710.0 $ 688.9 | |
Contract with Customer, Asset and Liability | Contract assets and liabilities Contract assets and liabilities consisted of the following: In millions March 31, December 31, $ Change % Change Contract assets $ 45.5 $ 41.0 $ 4.5 11.0 % Contract liabilities 30.4 32.6 (2.2 ) (6.7 )% Net contract assets $ 15.1 $ 8.4 $ 6.7 79.8 % |
Share Plans (Tables)
Share Plans (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Share-based Compensation Expense | Total share-based compensation expense for the three months ended March 31, 2020 and 2019 was as follows: Three months ended In millions March 31, March 31, Restricted stock units $ 3.2 $ 2.8 Stock options 1.0 1.4 Performance share units 2.0 1.2 Total share-based compensation expense $ 6.2 $ 5.4 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | We estimated the fair value of each stock option award issued in the annual share-based compensation grant using a Black-Scholes option pricing model, modified for dividends and using the following assumptions: 2020 Annual Grant Risk-free interest rate 1.61 % Expected dividend yield 1.80 % Expected share price volatility 24.1 % Expected term (years) 6.8 |
Restructuring (Tables)
Restructuring (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Related Costs | Restructuring-related costs within Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Income included the following: Three months ended In millions March 31, March 31, Severance and related costs $ 2.7 $ 1.1 Total restructuring costs $ 2.7 $ 1.1 |
Restructuring Costs By Segment [Table Text Block] | Restructuring costs by reportable segment were as follows: Three months ended In millions March 31, March 31, Consumer Solutions $ 0.6 $ 1.1 Industrial & Flow Technologies 0.9 (0.1 ) Other 1.2 0.1 Consolidated $ 2.7 $ 1.1 |
Restructuring Accrual Activity Recorded on Consolidated Balance Sheets | Activity related to accrued severance and related costs recorded in Other current liabilities in the Condensed Consolidated Balance Sheets is summarized as follows for the three months ended March 31, 2020 : In millions March 31, Beginning balance $ 16.2 Costs incurred 2.7 Cash payments and other (4.7 ) Ending balance $ 14.2 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Basic and Diluted Earnings Per Share | Basic and diluted earnings per share were calculated as follows: Three months ended In millions, except per-share data March 31, March 31, Net income $ 72.7 $ 51.3 Net income from continuing operations $ 72.7 $ 52.4 Weighted average ordinary shares outstanding Basic 167.8 171.6 Dilutive impact of stock options, restricted stock units and performance share units 0.9 0.9 Diluted 168.7 172.5 Earnings (loss) per ordinary share Basic Continuing operations $ 0.43 $ 0.31 Discontinued operations — (0.01 ) Basic earnings per ordinary share $ 0.43 $ 0.30 Diluted Continuing operations $ 0.43 $ 0.30 Discontinued operations — — Diluted earnings per ordinary share $ 0.43 $ 0.30 Anti-dilutive stock options excluded from the calculation of diluted earnings per share 2.0 1.7 |
Supplemental Balance Sheet In_2
Supplemental Balance Sheet Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Disclosure Supplemental Balance Sheet Information [Abstract] | |
Supplemental Balance Sheet Information | In millions March 31, December 31, Inventories Raw materials and supplies $ 201.0 $ 196.2 Work-in-process 66.3 65.2 Finished goods 125.1 116.0 Total inventories $ 392.4 $ 377.4 Other current assets Cost in excess of billings $ 45.5 $ 41.0 Prepaid expenses 55.8 48.3 Prepaid income taxes 7.8 5.2 Other current assets 3.8 4.6 Total other current assets $ 112.9 $ 99.1 Property, plant and equipment, net Land and land improvements $ 32.7 $ 33.7 Buildings and leasehold improvements 184.3 188.1 Machinery and equipment 537.9 537.2 Capitalized software 73.1 73.5 Construction in progress 53.4 48.1 Total property, plant and equipment 881.4 880.6 Accumulated depreciation and amortization 600.7 597.4 Total property, plant and equipment, net $ 280.7 $ 283.2 Other non-current assets Right-of-use lease assets $ 81.1 $ 77.2 Deferred income taxes 28.5 29.6 Deferred compensation plan assets 15.7 21.3 Foreign currency contract assets 32.8 0.1 Other non-current assets 65.0 68.7 Total other non-current assets $ 223.1 $ 196.9 Other current liabilities Dividends payable $ 31.5 $ 32.0 Accrued warranty 36.5 32.1 Accrued rebates and incentives 76.5 83.5 Billings in excess of cost 19.5 22.5 Current lease liability 18.8 19.0 Income taxes payable 4.3 11.1 Accrued restructuring 14.2 16.2 Other current liabilities 145.3 136.5 Total other current liabilities $ 346.6 $ 352.9 Other non-current liabilities Long-term lease liability $ 64.2 $ 61.1 Income taxes payable 45.5 45.4 Self-insurance liabilities 39.7 41.6 Deferred compensation plan liabilities 15.7 21.3 Foreign currency contract liabilities — 11.6 Other non-current liabilities 25.6 25.7 Total other non-current liabilities $ 190.7 $ 206.7 |
Goodwill and Other Identifiab_2
Goodwill and Other Identifiable Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Carrying Amount of Goodwill by Segment | The changes in the carrying amount of goodwill by reportable segment were as follows: In millions December 31, Purchase Accounting Adjustments Acquisitions Foreign currency translation/other March 31, Consumer Solutions $ 1,501.4 $ 14.4 $ 6.3 $ (2.9 ) $ 1,519.2 Industrial & Flow Technologies 756.9 — — (19.3 ) 737.6 Total goodwill $ 2,258.3 $ 14.4 $ 6.3 $ (22.2 ) $ 2,256.8 |
Detail of Identifiable Intangible Assets | Identifiable intangible assets consisted of the following: March 31, December 31, In millions Cost Accumulated amortization Net Cost Accumulated amortization Net Definite-life intangibles Customer relationships $ 410.3 $ (271.4 ) $ 138.9 $ 418.1 $ (269.1 ) $ 149.0 Proprietary technology and patents 41.7 (25.7 ) 16.0 42.3 (25.5 ) 16.8 Total definite-life intangibles 452.0 (297.1 ) 154.9 460.4 (294.6 ) 165.8 Indefinite-life intangibles Trade names 171.6 — 171.6 173.4 — 173.4 Total intangibles $ 623.6 $ (297.1 ) $ 326.5 $ 633.8 $ (294.6 ) $ 339.2 |
Estimated Future Amortization Expense for Identifiable Intangible Assets | Estimated future amortization expense for identifiable intangible assets during the remainder of 2020 and the next five years is as follows: Q2-Q4 In millions 2020 2021 2022 2023 2024 2025 Estimated amortization expense $ 19.6 $ 22.0 $ 15.4 $ 12.8 $ 12.3 $ 12.3 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt and Average Interest Rates on Debt Outstanding | Debt and the average interest rates on debt outstanding were as follows: In millions Average interest rate as of March 31, 2020 Maturity Year March 31, December 31, Commercial paper 2.097% 2023 $ — $ 117.8 Revolving credit facilities 2.069% 2023 574.5 35.8 Term loans (1) 2.696% 2023 200.0 200.0 Senior notes - fixed rate (1) 3.625% 2020 74.0 74.0 Senior notes - fixed rate (1) 5.000% 2021 103.8 103.8 Senior notes - fixed rate (1) 3.150% 2022 88.3 88.3 Senior notes - fixed rate (1) 4.650% 2025 19.3 19.3 Senior notes - fixed rate (1) 4.500% 2029 400.0 400.0 Unamortized debt issuance costs and discounts N/A N/A (9.4 ) (9.9 ) Total debt $ 1,450.5 $ 1,029.1 (1) Senior notes (“the Notes”) and the term loans are guaranteed as to payment by Pentair plc and PISG |
Debt Outstanding Matures on Calendar Year Basis | Debt outstanding, excluding unamortized issuance costs and discounts, at March 31, 2020 matures on a calendar year basis as follows: Q2-Q4 In millions 2020 2021 2022 2023 2024 2025 Thereafter Total Contractual debt obligation maturities $ 74.0 $ 103.8 $ 88.3 $ 774.5 $ — $ 19.3 $ 400.0 $ 1,459.9 |
Derivatives and Financial Ins_2
Derivatives and Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | Financial assets and liabilities measured at fair value on a recurring and nonrecurring basis were as follows: March 31, 2020 In millions Level 1 Level 2 Level 3 NAV Total Recurring fair value measurements Foreign currency contract assets $ — $ 32.8 $ — $ — $ 32.8 Deferred compensation plan assets 8.7 — — 7.0 15.7 Total recurring fair value measurements $ 8.7 $ 32.8 $ — $ 7.0 $ 48.5 December 31, 2019 In millions Level 1 Level 2 Level 3 NAV Total Recurring fair value measurements Foreign currency contract assets $ — $ 0.1 $ — $ — $ 0.1 Foreign currency contract liabilities — (11.6 ) — — (11.6 ) Deferred compensation plan assets 12.5 — — 8.8 21.3 Total recurring fair value measurements $ 12.5 $ (11.5 ) $ — $ 8.8 $ 9.8 Nonrecurring fair value measurements (1) (1) During the year ended December 31, 2019, we recorded impairment charges for cost method investments in the amount of $21.2 million , of which $15.3 million was recorded in the first quarter of 2019. A valuation method using unobservable inputs was utilized to determine the fair value. We wrote the balance of the cost method investments to zero. |
Recorded Amounts and Estimated Fair Values of Long-term Debt and Derivative Financial Instruments | The recorded amounts and estimated fair values of total debt, excluding unamortized issuance costs and discounts, were as follows: March 31, December 31, In millions Recorded Amount Fair Value Recorded Amount Fair Value Variable rate debt $ 774.5 $ 774.5 $ 353.6 $ 353.6 Fixed rate debt 685.4 714.0 685.4 732.2 Total debt $ 1,459.9 $ 1,488.5 $ 1,039.0 $ 1,085.8 |
Benefit Plans (Tables)
Benefit Plans (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Schedule of Net Benefit Costs | Components of net periodic benefit cost for our pension plans for the three months ended March 31, 2020 and 2019 were as follows: Three months ended In millions March 31, March 31, Service cost $ 0.8 $ 0.7 Interest cost 0.7 2.7 Expected return on plan assets (0.2 ) (1.7 ) Net periodic benefit cost $ 1.3 $ 1.7 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Financial Information by Reportable Segment | Financial information by reportable segment is as follows: Three months ended In millions March 31, March 31, Net sales Consumer Solutions $ 388.8 $ 358.2 Industrial & Flow Technologies 320.9 330.3 Other 0.3 0.4 Consolidated $ 710.0 $ 688.9 Segment income (loss) Consumer Solutions $ 84.8 $ 75.2 Industrial & Flow Technologies 44.7 41.0 Other (18.0 ) (17.5 ) Consolidated $ 111.5 $ 98.7 |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following table presents a reconciliation of consolidated segment income to consolidated income from continuing operations before income taxes: Three months ended In millions March 31, March 31, Segment income $ 111.5 $ 98.7 Deal-related costs and expenses (0.4 ) (4.2 ) Inventory step-up — (1.7 ) Restructuring and other (2.4 ) (1.1 ) Intangible amortization (7.6 ) (8.2 ) Asset impairment — (15.3 ) Gain on sale of businesses — 3.5 COVID-19 related costs and expenses (0.9 ) — Net interest expense (6.9 ) (7.3 ) Other expense (0.7 ) (1.2 ) Income from continuing operations before income taxes $ 92.6 $ 63.2 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Changes in Carrying Amount of Service and Product Warranties | The changes in the carrying amount of service and product warranties of continuing operations for the three months ended March 31, 2020 were as follows: In millions March 31, Beginning balance $ 32.1 Service and product warranty provision 16.3 Payments (11.5 ) Foreign currency translation (0.4 ) Ending balance $ 36.5 |
Basis of Presentation and Res_3
Basis of Presentation and Responsibility for Interim Financial Statements - Adoption of New Accounting Standards (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Accounting Policies [Abstract] | |
Beginning balance | $ 10.3 |
Bad debt expense | (1.1) |
Write-offs, net of recoveries | (0.3) |
Other | (0.3) |
Ending balance | $ 8.6 |
Revenue - Geographic Net Sales
Revenue - Geographic Net Sales Information by Segment (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 710 | $ 688.9 |
Residential | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 415.8 | 383.6 |
Commercial | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 141.4 | 150.7 |
Industrial | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 152.8 | 154.6 |
U.S. | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 464 | 426 |
Western Europe | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 103.8 | 104.3 |
Developing | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | 94.5 | 108.9 |
Other Developed | ||
Disaggregation of Revenue [Line Items] | ||
Net sales | $ 47.7 | $ 49.7 |
Revenue - Performance Obligatio
Revenue - Performance Obligations (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-04-01 $ in Millions | Mar. 31, 2020USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation | $ 50.4 |
Minimum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation period | 12 months |
Maximum | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation period | 18 months |
Revenue - Additional Informatio
Revenue - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Change in net contract assets | $ 6,700,000 |
Percent of contract liabilities | 45.00% |
Impairment losses on contract assets | $ 0 |
Revenue - Schedule of Contract
Revenue - Schedule of Contract Assets and Liabilities (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 45.5 | $ 41 |
Contract liabilities | 30.4 | 32.6 |
Net contract assets | 15.1 | $ 8.4 |
$ Change | ||
Contract assets | 4.5 | |
Contract liabilities | (2.2) | |
Net contract assets | $ 6.7 | |
% Change | ||
Contract assets | 11.00% | |
Contract liabilities | (6.70%) | |
Net contract assets | 79.80% |
Acquisitions Acquisitions (Deta
Acquisitions Acquisitions (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | ||
Feb. 28, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Business Acquisition [Line Items] | ||||
Acquisitions, net of cash acquired | $ 7.2 | $ 287.2 | ||
Goodwill | $ 2,256.8 | $ 2,258.3 | ||
Aquion | ||||
Business Acquisition [Line Items] | ||||
Acquisitions, net of cash acquired | $ 163.4 | |||
Goodwill | 101.9 | |||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 4.6 | |||
Indefinite-lived trade name intangible assets | 15.7 | |||
Definite-lived customer relationships | $ 78.8 | |||
Estimated useful life | 15 years | |||
Pelican | ||||
Business Acquisition [Line Items] | ||||
Acquisitions, net of cash acquired | $ 121.1 | |||
Goodwill | 118 | |||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | $ 7.6 |
Share Plans - Schedule of Share
Share Plans - Schedule of Share-based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based compensation expense | $ 6.2 | $ 5.4 |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based compensation expense | 3.2 | 2.8 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based compensation expense | 1 | 1.4 |
Performance share units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based compensation expense | $ 2 | $ 1.2 |
Share Plans - Schedule of Valua
Share Plans - Schedule of Valuation Assumptions (Details) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Risk-free interest rate | 1.61% |
Expected dividend yield | 1.80% |
Expected share price volatility | 24.10% |
Expected term (years) | 6 years 9 months 18 days |
Share Plans - Additional Inform
Share Plans - Additional Information (Detail) - 2012 Stock Incentive Plan shares in Millions | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Shares issued (in shares) | 0.8 |
Restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options granted (in shares) | 0.3 |
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 42.77 |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Grants in period (in shares) | 0.4 |
Weighted-average grant date fair value of options (in dollars per share) | $ / shares | $ 9.58 |
Performance share units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options granted (in shares) | 0.1 |
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 45.40 |
Restructuring - Additional Inf
Restructuring - Additional Information (Detail) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020USD ($)Person | Mar. 31, 2019USD ($) | Dec. 31, 2019Person | |
Restructuring Cost and Reserve [Line Items] | |||
Number of employees | Person | 75 | 375 | |
Total restructuring costs | $ 2.7 | $ 1.1 | |
Consumer Solutions [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring costs | 0.6 | 1.1 | |
Industrial & Flow Technologies [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring costs | 0.9 | (0.1) | |
Other | |||
Restructuring Cost and Reserve [Line Items] | |||
Total restructuring costs | $ 1.2 | $ 0.1 |
Restructuring - Costs Included
Restructuring - Costs Included in Selling, General & Administrative Expenses (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | $ 2.7 | $ 1.1 |
Severance and related costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring costs | $ 2.7 | $ 1.1 |
Restructuring - Accrual Activit
Restructuring - Accrual Activity (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Restructuring Reserve [Roll Forward] | |
Beginning balance | $ 16.2 |
Costs incurred | 2.7 |
Cash payments and other | (4.7) |
Ending balance | $ 14.2 |
Earnings Per Share - Basic and
Earnings Per Share - Basic and Diluted Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Earnings Per Share [Abstract] | ||
Net income | $ 72.7 | $ 51.3 |
Net income from continuing operations | $ 72.7 | $ 52.4 |
Weighted average common shares outstanding | ||
Basic (shares) | 167.8 | 171.6 |
Dilutive impact of stock options, restricted stock units and performance share units | 0.9 | 0.9 |
Diluted (shares) | 168.7 | 172.5 |
Basic | ||
Continuing operations (in dollars per share) | $ 0.43 | $ 0.31 |
Discontinued operations (in dollars per share) | 0 | (0.01) |
Basic earnings (loss) per ordinary share (in dollars per share) | 0.43 | 0.30 |
Diluted | ||
Continuing operations (in dollars per share) | 0.43 | 0.30 |
Discontinued operations (in dollars per share) | 0 | 0 |
Diluted earnings (loss) per ordinary share (in dollars per share) | $ 0.43 | $ 0.30 |
Anti-dilutive stock options excluded from the calculation of diluted earnings per share | 2 | 1.7 |
Supplemental Balance Sheet In_3
Supplemental Balance Sheet Information (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Inventories | ||
Raw materials and supplies | $ 201 | $ 196.2 |
Work-in-process | 66.3 | 65.2 |
Finished goods | 125.1 | 116 |
Total inventories | 392.4 | 377.4 |
Other current assets | ||
Cost in excess of billings | 45.5 | 41 |
Prepaid expenses | 55.8 | 48.3 |
Prepaid income taxes | 7.8 | 5.2 |
Other current assets | 3.8 | 4.6 |
Total other current assets | 112.9 | 99.1 |
Property, plant and equipment, net | ||
Land and land improvements | 32.7 | 33.7 |
Buildings and leasehold improvements | 184.3 | 188.1 |
Machinery and equipment | 537.9 | 537.2 |
Capitalized software | 73.1 | 73.5 |
Construction in progress | 53.4 | 48.1 |
Total property, plant and equipment | 881.4 | 880.6 |
Accumulated depreciation and amortization | 600.7 | 597.4 |
Total property, plant and equipment, net | 280.7 | 283.2 |
Other non-current assets | ||
Right-of-use lease assets | 81.1 | 77.2 |
Deferred income taxes | 28.5 | 29.6 |
Deferred compensation plan assets | 15.7 | 21.3 |
Foreign currency contract assets | 32.8 | 0.1 |
Other non-current assets | 65 | 68.7 |
Total other non-current assets | 223.1 | 196.9 |
Other current liabilities | ||
Dividends payable | 31.5 | 32 |
Accrued warranty | 36.5 | 32.1 |
Accrued rebates and incentives | 76.5 | 83.5 |
Billings in excess of cost | 19.5 | 22.5 |
Current lease liability | 18.8 | 19 |
Income taxes payable | 4.3 | 11.1 |
Accrued restructuring | 14.2 | 16.2 |
Other current liabilities | 145.3 | 136.5 |
Total other current liabilities | 346.6 | 352.9 |
Other non-current liabilities | ||
Long-term lease liability | 64.2 | 61.1 |
Income taxes payable | 45.5 | 45.4 |
Self-insurance liabilities | 39.7 | 41.6 |
Deferred compensation plan liabilities | 15.7 | 21.3 |
Foreign currency contract liabilities | 0 | 11.6 |
Other non-current liabilities | 25.6 | 25.7 |
Total other non-current liabilities | $ 190.7 | $ 206.7 |
Goodwill and Other Identifiab_3
Goodwill and Other Identifiable Intangible Assets - Changes in Carrying Amount of Goodwill by Segment (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Goodwill [Roll Forward] | |
Beginning Balance | $ 2,258.3 |
Purchase Accounting Adjustments | 6.3 |
Goodwill, Acquired During Period | 14.4 |
Foreign currency translation/other | (22.2) |
Ending Balance | 2,256.8 |
Consumer Solutions [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 1,501.4 |
Purchase Accounting Adjustments | 14.4 |
Goodwill, Acquired During Period | 6.3 |
Foreign currency translation/other | (2.9) |
Ending Balance | 1,519.2 |
Industrial & Flow Technologies [Member] | |
Goodwill [Roll Forward] | |
Beginning Balance | 756.9 |
Foreign currency translation/other | (19.3) |
Ending Balance | $ 737.6 |
Goodwill and Other Identifiab_4
Goodwill and Other Identifiable Intangible Assets - Detail of Identifiable Intangible Assets (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Acquired Intangible Assets By Major Class [Line Items] | ||
Cost | $ 452 | $ 460.4 |
Accumulated amortization | (297.1) | (294.6) |
Net | 154.9 | 165.8 |
Net, indefinite-life intangibles | 171.6 | 173.4 |
Cost | 623.6 | 633.8 |
Net | 326.5 | 339.2 |
Customer relationships | ||
Acquired Intangible Assets By Major Class [Line Items] | ||
Cost | 410.3 | 418.1 |
Accumulated amortization | (271.4) | (269.1) |
Net | 138.9 | 149 |
Patented Technology [Member] | ||
Acquired Intangible Assets By Major Class [Line Items] | ||
Cost | 41.7 | 42.3 |
Accumulated amortization | (25.7) | (25.5) |
Net | $ 16 | $ 16.8 |
Goodwill and Other Identifiab_5
Goodwill and Other Identifiable Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Intangible asset amortization expense | $ 7.6 | $ 8.2 |
Goodwill and Other Identifiab_6
Goodwill and Other Identifiable Intangible Assets - Estimated Future Amortization Expense for Identifiable Intangible Assets (Detail) $ in Millions | Mar. 31, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Q2 - Q4 2020 | $ 19.6 |
2021 | 22 |
2022 | 15.4 |
2023 | 12.8 |
2024 | 12.3 |
2025 | $ 12.3 |
Debt - Debt and Average Interes
Debt - Debt and Average Interest Rates on Debt Outstanding (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Unamortized debt issuance costs and discounts | $ (9.4) | $ (9.9) |
Total debt | $ 1,450.5 | 1,029.1 |
Commercial Paper | ||
Debt Instrument [Line Items] | ||
Average interest rate as of March 31, 2020 | 2.097% | |
Commercial paper | $ 0 | 117.8 |
Line of Credit | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Average interest rate as of March 31, 2020 | 2.069% | |
Total debt | $ 574.5 | 35.8 |
Term Loans | Term Loans, due 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Average interest rate as of March 31, 2020 | 2.696% | |
Total debt | $ 200 | 200 |
Senior Notes | Senior Notes 3.625% Due 2020 | ||
Debt Instrument [Line Items] | ||
Average interest rate as of March 31, 2020 | 3.625% | |
Total debt | $ 74 | 74 |
Senior Notes | Senior Notes 5.000% Due 2021 | ||
Debt Instrument [Line Items] | ||
Average interest rate as of March 31, 2020 | 5.00% | |
Total debt | $ 103.8 | 103.8 |
Senior Notes | Senior Notes 3.150% Due 2022 | ||
Debt Instrument [Line Items] | ||
Average interest rate as of March 31, 2020 | 3.15% | |
Total debt | $ 88.3 | 88.3 |
Senior Notes | Senior Notes 4.650% Due 2025 | ||
Debt Instrument [Line Items] | ||
Average interest rate as of March 31, 2020 | 4.65% | |
Total debt | $ 19.3 | 19.3 |
Senior Notes | Senior Notes 4.500% Due 2029 | ||
Debt Instrument [Line Items] | ||
Average interest rate as of March 31, 2020 | 4.50% | |
Total debt | $ 400 | $ 400 |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) | Apr. 25, 2018 | May 31, 2019 | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||||
Leverage ratio covenant period | 12 months | |||
Debt | $ 1,450,500,000 | $ 1,029,100,000 | ||
Aggregate principal amount maturing in next twelve months | 74,000,000 | |||
Line of Credit | Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Credit facility maximum borrowing capacity | $ 800,000,000 | $ 900,000,000 | ||
Debt term | 5 years | |||
Line of Credit Facility, Increase | $ 100,000,000 | |||
Credit facility available borrowing capacity | 325,500,000 | |||
Debt | $ 574,500,000 | 35,800,000 | ||
Average interest rate as of March 31, 2020 | 2.069% | |||
Line of Credit | Revolving Credit Facility | Maximum | ||||
Debt Instrument [Line Items] | ||||
Debt covenant, unrestricted cash | $ 250,000,000 | |||
Debt agreement financial covenant, leverage ratio | 1 | |||
EBITDA ratio for debt | 3 | |||
Line of Credit | Revolving Credit Facility | Minimum | ||||
Debt Instrument [Line Items] | ||||
Debt covenant, unrestricted cash | $ 5,000,000 | |||
Debt agreement financial covenant, leverage ratio | 3.75 | |||
EBITDA ratio for debt | 1 | |||
Term Loans | Term Loans, 2.914% due in 2023 [Member] | ||||
Debt Instrument [Line Items] | ||||
Long-term Debt, Gross | 200,000,000 | |||
Optional line of credit limit increase | 300,000,000 | |||
Commercial Paper | ||||
Debt Instrument [Line Items] | ||||
Commercial paper | $ 0 | 117,800,000 | ||
Average interest rate as of March 31, 2020 | 2.097% | |||
Senior Notes | Senior Notes 4.500% Due 2029 | ||||
Debt Instrument [Line Items] | ||||
Debt | $ 400,000,000 | $ 400,000,000 | ||
Average interest rate as of March 31, 2020 | 4.50% | |||
Other Credit Facilities [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility maximum borrowing capacity | $ 20,900,000 | |||
Borrowings outstanding | $ 0 |
Debt - Debt Outstanding Matures
Debt - Debt Outstanding Matures on Calendar Year Basis (Detail) $ in Millions | Mar. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
Q2 - Q4 2020 | $ 74 |
2021 | 103.8 |
2022 | 88.3 |
2023 | 774.5 |
2024 | 0 |
2025 | 19.3 |
Thereafter | 400 |
Total debt | $ 1,459.9 |
Derivatives and Financial Ins_3
Derivatives and Financial Instruments - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2018 | Dec. 31, 2019 | |
Foreign Exchange Contract [Member] | |||
Derivative [Line Items] | |||
Notional amount | $ 5.8 | $ 17 | |
Currency Swap [Member] | |||
Derivative [Line Items] | |||
Notional amount | 761.7 | $ 770 | |
Deferred foreign currency gain (loss) | $ 37 | $ 1.8 |
Derivatives and Financial Ins_4
Derivatives and Financial Instruments - Recorded Amounts and Estimated Fair Values (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Derivative [Line Items] | ||
Total debt | $ 1,459.9 | |
Recorded Amount | ||
Derivative [Line Items] | ||
Variable rate debt | 774.5 | $ 353.6 |
Fixed rate debt | 685.4 | 685.4 |
Total debt | 1,459.9 | 1,039 |
Fair Value | ||
Derivative [Line Items] | ||
Variable rate debt | 774.5 | 353.6 |
Fixed rate debt | 714 | 732.2 |
Total debt | $ 1,488.5 | $ 1,085.8 |
Derivatives and Financial Ins_5
Derivatives and Financial Instruments - Assets and Liabilities Measured at Fair Value (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Cost-method Investments, Realized Losses | $ 21.2 | ||
Foreign currency contract assets | $ 32.8 | 0.1 | |
Foreign currency contract liabilities | 0 | (11.6) | |
Asset impairment | 0 | $ 15.3 | |
Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign currency contract assets | 32.8 | 0.1 | |
Foreign currency contract liabilities | (11.6) | ||
Deferred compensation plan | 15.7 | 21.3 | |
Total recurring fair value measurements | 48.5 | 9.8 | |
Fair Value, Inputs, Level 1 | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign currency contract assets | 0 | 0 | |
Foreign currency contract liabilities | 0 | ||
Deferred compensation plan | 8.7 | 12.5 | |
Total recurring fair value measurements | 8.7 | 12.5 | |
Fair Value, Inputs, Level 2 | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign currency contract assets | 32.8 | 0.1 | |
Foreign currency contract liabilities | (11.6) | ||
Deferred compensation plan | 0 | 0 | |
Total recurring fair value measurements | 32.8 | (11.5) | |
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign currency contract assets | 0 | 0 | |
Foreign currency contract liabilities | 0 | ||
Deferred compensation plan | 0 | 0 | |
Total recurring fair value measurements | 0 | 0 | |
Fair Value Measured at Net Asset Value Per Share [Member] | Fair Value, Measurements, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Foreign currency contract assets | 0 | 0 | |
Foreign currency contract liabilities | 0 | ||
Deferred compensation plan | 7 | 8.8 | |
Total recurring fair value measurements | $ 7 | $ 8.8 |
Income Taxes - Additional Info
Income Taxes - Additional Information (Detail) $ in Millions | 1 Months Ended | 3 Months Ended | ||
Apr. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Mar. 31, 2019 | Dec. 31, 2019USD ($) | |
Subsequent Event [Line Items] | ||||
Effective income tax rate | 21.50% | 17.10% | ||
Tax benefit, CARES Act | $ 16.2 | |||
Tax expense, base erosion and anti-abuse tax | 6.8 | |||
Total gross liability for unrecognized tax benefits | $ 47.5 | $ 47.4 | ||
Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Tax expense, Tax Cuts and Jobs Act | $ 14.1 | |||
Effective tax rate, Tax Cuts and Jobs Act | 0.01 |
Benefit Plans (Detail)
Benefit Plans (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Retirement Benefits [Abstract] | ||
Service cost | $ 0.8 | $ 0.7 |
Interest cost | 0.7 | 2.7 |
Expected return on plan assets | (0.2) | (1.7) |
Net periodic benefit cost | $ 1.3 | $ 1.7 |
Shareholders' Equity - Additio
Shareholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, shares in Millions | Feb. 25, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2014 | Dec. 31, 2019 | May 08, 2018 |
Stockholders Equity Note Disclosure [Line Items] | ||||||
Stock repurchased (in shares) | $ 115,200,000 | |||||
Payments for Repurchase of Common Stock | $ 115,200,000 | $ 0 | ||||
Cash dividends declared per ordinary share | $ 0.19 | $ 0.19 | $ 0.18 | |||
Dividends payable | $ 31,500,000 | $ 32,000,000 | ||||
May 2018 Share Repurchase Program [Member] | ||||||
Stockholders Equity Note Disclosure [Line Items] | ||||||
Repurchase of shares of our common stock up to a maximum aggregate value | $ 750,000,000 | |||||
Common stock authorized for repurchase, expiration date | May 31, 2021 | |||||
Share repurchases (in shares) | 3 | |||||
December 2014 Share Repurchase Program | ||||||
Stockholders Equity Note Disclosure [Line Items] | ||||||
Share repurchase program remaining available amount | $ 134,700,000 |
Segment Information - Financial
Segment Information - Financial Information by Reportable Segment (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Segment Reporting Information [Line Items] | ||
Net sales | $ 710 | $ 688.9 |
Segment income | 100.7 | 67.6 |
Consumer Solutions [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 388.8 | 358.2 |
Segment income | 84.8 | 75.2 |
Industrial & Flow Technologies [Member] | ||
Segment Reporting Information [Line Items] | ||
Net sales | 320.9 | 330.3 |
Segment income | 44.7 | 41 |
Other | ||
Segment Reporting Information [Line Items] | ||
Net sales | 0.3 | 0.4 |
Segment income | (18) | (17.5) |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Segment income | $ 111.5 | $ 98.7 |
Segment Information Reconciliat
Segment Information Reconciliation of Operating Profit (Loss) from Segments to Consolidated (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Segment income | $ 100.7 | $ 67.6 |
Restructuring and other | (2.7) | (1.1) |
Intangible amortization | (7.6) | (8.2) |
Asset Impairment | 0 | (15.3) |
Gain on sale of businesses | 0 | 3.5 |
Other expense | (1.2) | (0.6) |
Income from continuing operations before income taxes | 92.6 | 63.2 |
Operating Segments | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Segment income | 111.5 | 98.7 |
Segment Reconciling Items [Member] | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Restructuring and other | (2.4) | (1.1) |
Intangible amortization | (7.6) | (8.2) |
Gain on sale of businesses | 0 | 3.5 |
COVID-19 related costs and expenses | (0.9) | 0 |
Net interest expense | (6.9) | (7.3) |
Other expense | (0.7) | (1.2) |
Segment Reconciling Items [Member] | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||
Deal-related costs and expenses | (0.4) | (4.2) |
Inventory step-up | 0 | (1.7) |
Asset Impairment | $ 0 | $ (15.3) |
Commitments and Contingencies
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Commitments and Contingencies Disclosure [Abstract] | ||
Letters of credit outstanding | $ 89.3 | $ 91.3 |
Commitments and Contingencies -
Commitments and Contingencies - Changes in Carrying Amount of Service and Product Warranties (Detail) $ in Millions | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Movement in Standard Product Warranty Accrual [Roll Forward] | |
Beginning balance | $ 32.1 |
Service and product warranty provision | 16.3 |
Payments | (11.5) |
Foreign currency translation | (0.4) |
Ending balance | $ 36.5 |