Price Graph
Price
Yield
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Delaware
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39-1434669
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(State or other jurisdiction of
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(I.R.S. Employer
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incorporation or organization)
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Identification No.)
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221 West Philadelphia Street, York, PA
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17401-2991
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
x
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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Emerging growth company
o
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
o
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Three Months Ended June 30,
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Six Months Ended June 30,
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||||||||||||
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2018
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2017
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2018
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2017
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||||||||
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||||||||
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Net sales
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$
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1,042.1
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$
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992.7
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$
|
1,998.2
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$
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1,893.2
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Cost of products sold
|
489.3
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|
448.5
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|
931.3
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|
857.0
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||||
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||||||||
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Gross profit
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552.8
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544.2
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1,066.9
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|
1,036.2
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||||
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Selling, general and administrative expenses
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432.2
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417.6
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867.4
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|
822.3
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||||
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Goodwill impairment
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1,085.8
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1,092.9
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1,085.8
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|
1,092.9
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||||
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Restructuring and other costs
|
188.9
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81.7
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|
199.1
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|
84.8
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||||
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||||||||
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Operating loss
|
(1,154.1
|
)
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|
(1,048.0
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)
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|
(1,085.4
|
)
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(963.8
|
)
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||||
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||||||||
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Other income and expenses:
|
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||||
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Interest expense
|
9.6
|
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|
9.6
|
|
|
18.2
|
|
|
18.9
|
|
||||
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Interest income
|
(0.4
|
)
|
|
(0.6
|
)
|
|
(1.0
|
)
|
|
(1.3
|
)
|
||||
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Other expense (income), net
|
(1.0
|
)
|
|
7.8
|
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(35.1
|
)
|
|
6.8
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|
||||
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||||||||
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Loss before income taxes
|
(1,162.3
|
)
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|
(1,064.8
|
)
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|
(1,067.5
|
)
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|
(988.2
|
)
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||||
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Provision (benefit) for income taxes
|
(41.3
|
)
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|
(14.5
|
)
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(27.6
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)
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2.4
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||||
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||||||||
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Net loss
|
(1,121.0
|
)
|
|
(1,050.3
|
)
|
|
(1,039.9
|
)
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|
(990.6
|
)
|
||||
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||||||||
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Less: Net income (loss) attributable to noncontrolling interests
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1.0
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(0.3
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)
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|
0.9
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(0.4
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)
|
||||
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||||||||
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Net loss attributable to Dentsply Sirona
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$
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(1,122.0
|
)
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$
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(1,050.0
|
)
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|
$
|
(1,040.8
|
)
|
|
$
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(990.2
|
)
|
|
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||||||||
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Net loss per common share attributable to Dentsply Sirona:
|
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||||
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Basic
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$
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(4.98
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)
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$
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(4.58
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)
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$
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(4.60
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)
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$
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(4.31
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)
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Diluted
|
$
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(4.98
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)
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|
$
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(4.58
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)
|
|
$
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(4.60
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)
|
|
$
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(4.31
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)
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||||||||
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Weighted average common shares outstanding:
|
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|
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|
|
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||||
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Basic
|
225.2
|
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|
229.4
|
|
|
226.2
|
|
|
229.7
|
|
||||
|
Diluted
|
225.2
|
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|
229.4
|
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|
226.2
|
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|
229.7
|
|
||||
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||||||||
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Dividends declared per common share:
|
$
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0.0875
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$
|
0.0875
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$
|
0.1750
|
|
|
$
|
0.1750
|
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|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
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2018
|
|
2017
|
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2018
|
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2017
|
||||||||
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|
||||||||
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Net loss
|
$
|
(1,121.0
|
)
|
|
$
|
(1,050.3
|
)
|
|
$
|
(1,039.9
|
)
|
|
$
|
(990.6
|
)
|
|
|
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|
|
|
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|
||||||||
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Other comprehensive (loss) income, net of tax:
|
|
|
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|
||||||||
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Foreign currency translation (loss) gain
|
(192.6
|
)
|
|
222.0
|
|
|
(126.9
|
)
|
|
271.7
|
|
||||
|
Net gain (loss) on derivative financial instruments
|
29.6
|
|
|
(2.5
|
)
|
|
17.6
|
|
|
(5.8
|
)
|
||||
|
Net realized holding gain on available for sale securities
|
—
|
|
|
—
|
|
|
(44.3
|
)
|
|
—
|
|
||||
|
Pension liability gain
|
3.0
|
|
|
1.1
|
|
|
4.2
|
|
|
2.3
|
|
||||
|
Total other comprehensive (loss) income, net of tax
|
(160.0
|
)
|
|
220.6
|
|
|
(149.4
|
)
|
|
268.2
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
Total comprehensive loss
|
(1,281.0
|
)
|
|
(829.7
|
)
|
|
(1,189.3
|
)
|
|
(722.4
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
Less: Comprehensive income attributable
|
|
|
|
|
|
|
|
|
|
||||||
|
to noncontrolling interests
|
0.8
|
|
|
0.3
|
|
|
1.3
|
|
|
0.1
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
Comprehensive loss attributable to Dentsply Sirona
|
$
|
(1,281.8
|
)
|
|
$
|
(830.0
|
)
|
|
$
|
(1,190.6
|
)
|
|
$
|
(722.5
|
)
|
|
|
|
|
|
|
|
|
|
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|
||||||
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
Assets
|
|
|
|
||||
|
Current Assets:
|
|
|
|
||||
|
Cash and cash equivalents
|
$
|
239.3
|
|
|
$
|
320.6
|
|
|
Accounts and notes receivables-trade, net
|
710.3
|
|
|
746.2
|
|
||
|
Inventories, net
|
666.3
|
|
|
623.1
|
|
||
|
Prepaid expenses and other current assets, net
|
276.5
|
|
|
312.6
|
|
||
|
|
|
|
|
||||
|
Total Current Assets
|
1,892.4
|
|
|
2,002.5
|
|
||
|
|
|
|
|
||||
|
Property, plant and equipment, net
|
857.6
|
|
|
876.0
|
|
||
|
Identifiable intangible assets, net
|
2,546.8
|
|
|
2,800.7
|
|
||
|
Goodwill, net
|
3,457.8
|
|
|
4,539.2
|
|
||
|
Other noncurrent assets, net
|
67.4
|
|
|
156.1
|
|
||
|
|
|
|
|
||||
|
Total Assets
|
$
|
8,822.0
|
|
|
$
|
10,374.5
|
|
|
|
|
|
|
||||
|
Liabilities and Equity
|
|
|
|
|
|
||
|
Current Liabilities:
|
|
|
|
|
|
||
|
Accounts payable
|
$
|
292.4
|
|
|
$
|
284.4
|
|
|
Accrued liabilities
|
575.3
|
|
|
585.8
|
|
||
|
Income taxes payable
|
31.9
|
|
|
54.2
|
|
||
|
Notes payable and current portion of long-term debt
|
218.1
|
|
|
30.1
|
|
||
|
|
|
|
|
||||
|
Total Current Liabilities
|
1,117.7
|
|
|
954.5
|
|
||
|
|
|
|
|
||||
|
Long-term debt
|
1,586.6
|
|
|
1,611.6
|
|
||
|
Deferred income taxes
|
538.0
|
|
|
718.0
|
|
||
|
Other noncurrent liabilities
|
439.6
|
|
|
462.5
|
|
||
|
|
|
|
|
||||
|
Total Liabilities
|
3,681.9
|
|
|
3,746.6
|
|
||
|
|
|
|
|
||||
|
Commitments and contingencies
|
—
|
|
|
—
|
|
||
|
|
|
|
|
||||
|
Equity:
|
|
|
|
|
|
||
|
Preferred stock, $1.00 par value; 0.25 million shares authorized; no shares issued
|
—
|
|
|
—
|
|
||
|
Common stock, $0.01 par value;
|
2.6
|
|
|
2.6
|
|
||
|
400.0 million shares authorized and 264.5 million shares issued at June 30, 2018 and December 31, 2017, respectively
|
|
|
|
||||
|
222.2 million and 226.8 million shares outstanding at June 30, 2018 and December 31, 2017, respectively
|
|
|
|
||||
|
Capital in excess of par value
|
6,526.2
|
|
|
6,543.9
|
|
||
|
Retained earnings
|
1,216.2
|
|
|
2,316.2
|
|
||
|
Accumulated other comprehensive loss
|
(440.8
|
)
|
|
(291.0
|
)
|
||
|
Treasury stock, at cost, 42.3 million and 37.7 million shares at June 30, 2018 and December 31, 2017, respectively
|
(2,177.0
|
)
|
|
(1,955.4
|
)
|
||
|
Total Dentsply Sirona Equity
|
5,127.2
|
|
|
6,616.3
|
|
||
|
|
|
|
|
||||
|
Noncontrolling interests
|
12.9
|
|
|
11.6
|
|
||
|
|
|
|
|
||||
|
Total Equity
|
5,140.1
|
|
|
6,627.9
|
|
||
|
|
|
|
|
||||
|
Total Liabilities and Equity
|
$
|
8,822.0
|
|
|
$
|
10,374.5
|
|
|
|
Common
Stock
|
|
Capital in
Excess of
Par Value
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Treasury
Stock
|
|
Total Dentsply Sirona
Equity |
|
Noncontrolling
Interests
|
|
Total
Equity
|
||||||||||||||||
|
Balance at December 31, 2016
|
$
|
2.6
|
|
|
$
|
6,516.7
|
|
|
$
|
3,948.0
|
|
|
$
|
(705.7
|
)
|
|
$
|
(1,647.3
|
)
|
|
$
|
8,114.3
|
|
|
$
|
11.6
|
|
|
$
|
8,125.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net loss
|
—
|
|
|
—
|
|
|
(990.2
|
)
|
|
—
|
|
|
—
|
|
|
(990.2
|
)
|
|
(0.4
|
)
|
|
(990.6
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
267.7
|
|
|
—
|
|
|
267.7
|
|
|
0.5
|
|
|
268.2
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Exercise of stock options
|
—
|
|
|
6.3
|
|
|
—
|
|
|
—
|
|
|
39.1
|
|
|
45.4
|
|
|
—
|
|
|
45.4
|
|
||||||||
|
Stock based compensation expense
|
—
|
|
|
21.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
21.9
|
|
|
—
|
|
|
21.9
|
|
||||||||
|
Reclassification on adoption of ASU No. 2016-09
|
—
|
|
|
1.0
|
|
|
(1.5
|
)
|
|
—
|
|
|
—
|
|
|
(0.5
|
)
|
|
—
|
|
|
(0.5
|
)
|
||||||||
|
Funding of Employee Stock Ownership Plan
|
—
|
|
|
3.3
|
|
|
—
|
|
|
—
|
|
|
3.3
|
|
|
6.6
|
|
|
—
|
|
|
6.6
|
|
||||||||
|
Treasury shares purchased
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(150.3
|
)
|
|
(150.3
|
)
|
|
—
|
|
|
(150.3
|
)
|
||||||||
|
RSU distributions
|
—
|
|
|
(22.1
|
)
|
|
—
|
|
|
—
|
|
|
10.1
|
|
|
(12.0
|
)
|
|
—
|
|
|
(12.0
|
)
|
||||||||
|
RSU dividends
|
—
|
|
|
0.3
|
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
|
Cash dividends
|
—
|
|
|
—
|
|
|
(40.4
|
)
|
|
—
|
|
|
—
|
|
|
(40.4
|
)
|
|
—
|
|
|
(40.4
|
)
|
||||||||
|
Balance at June 30, 2017
|
$
|
2.6
|
|
|
$
|
6,527.4
|
|
|
$
|
2,915.6
|
|
|
$
|
(438.0
|
)
|
|
$
|
(1,745.1
|
)
|
|
$
|
7,262.5
|
|
|
$
|
11.7
|
|
|
$
|
7,274.2
|
|
|
|
Common
Stock
|
|
Capital in
Excess of
Par Value
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Treasury
Stock
|
|
Total Dentsply Sirona
Equity |
|
Noncontrolling
Interests
|
|
Total
Equity
|
||||||||||||||||
|
Balance at December 31, 2017
|
$
|
2.6
|
|
|
$
|
6,543.9
|
|
|
$
|
2,316.2
|
|
|
$
|
(291.0
|
)
|
|
$
|
(1,955.4
|
)
|
|
$
|
6,616.3
|
|
|
$
|
11.6
|
|
|
$
|
6,627.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net (loss) income
|
—
|
|
|
—
|
|
|
(1,040.8
|
)
|
|
—
|
|
|
—
|
|
|
(1,040.8
|
)
|
|
0.9
|
|
|
(1,039.9
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Other comprehensive (loss) income
|
—
|
|
|
—
|
|
|
—
|
|
|
(149.8
|
)
|
|
—
|
|
|
(149.8
|
)
|
|
0.4
|
|
|
(149.4
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Exercise of stock options
|
—
|
|
|
(6.4
|
)
|
|
—
|
|
|
—
|
|
|
17.6
|
|
|
11.2
|
|
|
—
|
|
|
11.2
|
|
||||||||
|
Cumulative effect on adoption of ASC 606
|
—
|
|
|
—
|
|
|
(6.0
|
)
|
|
—
|
|
|
—
|
|
|
(6.0
|
)
|
|
—
|
|
|
(6.0
|
)
|
||||||||
|
Reclassification on adoption of ASU No. 2016-16
|
—
|
|
|
—
|
|
|
(2.7
|
)
|
|
—
|
|
|
—
|
|
|
(2.7
|
)
|
|
—
|
|
|
(2.7
|
)
|
||||||||
|
Reclassification on adoption of ASU No. 2018-02
|
—
|
|
|
—
|
|
|
8.1
|
|
|
—
|
|
|
—
|
|
|
8.1
|
|
|
—
|
|
|
8.1
|
|
||||||||
|
Stock based compensation expense
|
—
|
|
|
9.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9.8
|
|
|
—
|
|
|
9.8
|
|
||||||||
|
Treasury shares purchased
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(250.2
|
)
|
|
(250.2
|
)
|
|
—
|
|
|
(250.2
|
)
|
||||||||
|
RSU distributions
|
—
|
|
|
(21.4
|
)
|
|
—
|
|
|
—
|
|
|
11.0
|
|
|
(10.4
|
)
|
|
—
|
|
|
(10.4
|
)
|
||||||||
|
RSU dividends
|
—
|
|
|
0.3
|
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
|
Cash dividends
|
—
|
|
|
—
|
|
|
(58.3
|
)
|
|
—
|
|
|
—
|
|
|
(58.3
|
)
|
|
—
|
|
|
(58.3
|
)
|
||||||||
|
Balance at June 30, 2018
|
$
|
2.6
|
|
|
$
|
6,526.2
|
|
|
$
|
1,216.2
|
|
|
$
|
(440.8
|
)
|
|
$
|
(2,177.0
|
)
|
|
$
|
5,127.2
|
|
|
$
|
12.9
|
|
|
$
|
5,140.1
|
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2018
|
|
2017
|
||||
|
Cash flows from operating activities:
|
|
|
|
||||
|
Net loss
|
$
|
(1,039.9
|
)
|
|
$
|
(990.6
|
)
|
|
|
|
|
|
||||
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
|
|
||
|
Depreciation
|
68.8
|
|
|
62.1
|
|
||
|
Amortization of intangible assets
|
100.1
|
|
|
91.8
|
|
||
|
Amortization of deferred financing costs
|
1.3
|
|
|
1.3
|
|
||
|
Goodwill impairment
|
1,085.8
|
|
|
1,092.9
|
|
||
|
Indefinite-lived intangible asset impairment
|
179.2
|
|
|
79.8
|
|
||
|
Deferred income taxes
|
(70.8
|
)
|
|
(34.2
|
)
|
||
|
Stock based compensation expense
|
9.8
|
|
|
21.9
|
|
||
|
Restructuring and other costs - non-cash
|
9.1
|
|
|
1.0
|
|
||
|
Other non-cash (income) expense
|
(2.9
|
)
|
|
5.5
|
|
||
|
Loss on disposal of property, plant and equipment
|
0.6
|
|
|
0.4
|
|
||
|
Gain on sale of equity security
|
(44.1
|
)
|
|
—
|
|
||
|
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
|
||
|
Accounts and notes receivable-trade, net
|
23.0
|
|
|
1.9
|
|
||
|
Inventories, net
|
(69.3
|
)
|
|
(49.6
|
)
|
||
|
Prepaid expenses and other current assets, net
|
(25.7
|
)
|
|
(59.3
|
)
|
||
|
Other noncurrent assets, net
|
(7.7
|
)
|
|
1.2
|
|
||
|
Accounts payable
|
(6.5
|
)
|
|
9.5
|
|
||
|
Accrued liabilities
|
(4.6
|
)
|
|
(19.2
|
)
|
||
|
Income taxes
|
(28.5
|
)
|
|
(15.4
|
)
|
||
|
Other noncurrent liabilities
|
(5.7
|
)
|
|
7.7
|
|
||
|
|
|
|
|
||||
|
Net cash provided by operating activities
|
172.0
|
|
|
208.7
|
|
||
|
|
|
|
|
||||
|
Cash flows from investing activities:
|
|
|
|
|
|
||
|
|
|
|
|
||||
|
Capital expenditures
|
(81.2
|
)
|
|
(64.8
|
)
|
||
|
Cash paid for acquisitions of businesses and equity investments, net of cash acquired
|
(130.5
|
)
|
|
(125.2
|
)
|
||
|
Cash received on derivatives contracts
|
1.9
|
|
|
5.3
|
|
||
|
Cash paid on derivatives contracts
|
(2.4
|
)
|
|
—
|
|
||
|
Expenditures for identifiable intangible assets
|
(5.3
|
)
|
|
(5.9
|
)
|
||
|
Purchase of short-term investments
|
—
|
|
|
(2.3
|
)
|
||
|
Purchase of Company-owned life insurance policies
|
—
|
|
|
(0.9
|
)
|
||
|
Proceeds from sale of equity security
|
54.1
|
|
|
—
|
|
||
|
Proceeds from sale of property, plant and equipment, net
|
3.9
|
|
|
1.9
|
|
||
|
|
|
|
|
||||
|
Net cash used in investing activities
|
(159.5
|
)
|
|
(191.9
|
)
|
||
|
|
|
|
|
||||
|
Cash flows from financing activities:
|
|
|
|
|
|
||
|
|
|
|
|
||||
|
Increase in short-term borrowings
|
187.3
|
|
|
1.4
|
|
||
|
Cash paid for treasury stock
|
(250.2
|
)
|
|
(151.5
|
)
|
||
|
Cash dividends paid
|
(39.7
|
)
|
|
(38.1
|
)
|
||
|
Proceeds from long-term borrowings
|
0.3
|
|
|
2.9
|
|
||
|
Repayments on long-term borrowings
|
(0.4
|
)
|
|
(6.6
|
)
|
||
|
Proceeds from exercised stock options
|
13.9
|
|
|
45.4
|
|
||
|
|
|
|
|
||||
|
Net cash used in financing activities
|
(88.8
|
)
|
|
(146.5
|
)
|
||
|
|
|
|
|
||||
|
Effect of exchange rate changes on cash and cash equivalents
|
(5.0
|
)
|
|
14.2
|
|
||
|
|
|
|
|
||||
|
Net decrease in cash and cash equivalents
|
(81.3
|
)
|
|
(115.5
|
)
|
||
|
|
|
|
|
||||
|
Cash and cash equivalents at beginning of period
|
320.6
|
|
|
383.9
|
|
||
|
|
|
|
|
||||
|
Cash and cash equivalents at end of period
|
$
|
239.3
|
|
|
$
|
268.4
|
|
|
(in millions)
|
|
|
|
|
|
|
||||||
|
Consolidated Balance Sheets Item
|
|
December 31, 2017 As Reported Balance
|
|
Adoption of ASC 606
|
|
January 1, 2018 Revised Balance
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Assets
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Accounts and notes receivable-trade, net
|
|
$
|
746.2
|
|
|
$
|
0.2
|
|
|
$
|
746.4
|
|
|
Inventory, net
|
|
623.1
|
|
|
(0.3
|
)
|
|
622.8
|
|
|||
|
Prepaid expense and other current assets, net
|
|
312.6
|
|
|
1.9
|
|
|
314.5
|
|
|||
|
|
|
|
|
|
|
|
||||||
|
Liabilities and Equity
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Accrued liabilities
|
|
585.8
|
|
|
9.9
|
|
|
595.7
|
|
|||
|
Income taxes payable
|
|
54.2
|
|
|
(2.1
|
)
|
|
52.1
|
|
|||
|
Retained earnings
|
|
2,316.2
|
|
|
(6.0
|
)
|
|
2,310.2
|
|
|||
|
(in millions)
|
|
Three Months Ended June 30, 2018
|
|
Six Months Ended June 30, 2018
|
||||||||||||||||||||
|
Consolidated Statements of Operations Item
|
|
As Reported Balance
|
|
Balances Without Adoption of ASC 606
|
|
Effect of Change Increase/(Decrease)
|
|
As Reported Balance
|
|
Balances Without Adoption of ASC 606
|
|
Effect of Change Increase/(Decrease)
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Net sales
|
|
$
|
1,042.1
|
|
|
$
|
1,044.8
|
|
|
$
|
(2.7
|
)
|
|
$
|
1,998.2
|
|
|
$
|
1,998.8
|
|
|
$
|
(0.6
|
)
|
|
Cost of products sold
|
|
489.3
|
|
|
491.4
|
|
|
(2.1
|
)
|
|
931.3
|
|
|
930.3
|
|
|
1.0
|
|
||||||
|
Selling, general and administrative expenses
|
|
432.2
|
|
|
432.3
|
|
|
(0.1
|
)
|
|
867.4
|
|
|
868.1
|
|
|
(0.7
|
)
|
||||||
|
Provision (benefit) for income taxes
|
|
(41.3
|
)
|
|
(41.2
|
)
|
|
(0.1
|
)
|
|
(27.6
|
)
|
|
(27.4
|
)
|
|
(0.2
|
)
|
||||||
|
Net loss attributable to Dentsply Sirona
|
|
(1,122.0
|
)
|
|
(1,121.6
|
)
|
|
(0.4
|
)
|
|
(1,040.8
|
)
|
|
(1,040.1
|
)
|
|
(0.7
|
)
|
||||||
|
(in millions)
|
|
Balance at June 30, 2018
|
||||||||||
|
Consolidated Balance Sheets Item
|
|
As Reported Balance
|
|
Balances Without Adoption of ASC 606
|
|
Effect of Change Increase/(Decrease)
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Assets
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Accounts and notes receivables-trade, net
|
|
$
|
710.3
|
|
|
$
|
710.2
|
|
|
$
|
0.1
|
|
|
Inventories, net
|
|
666.3
|
|
|
666.6
|
|
|
(0.3
|
)
|
|||
|
Prepaid expenses and other current assets, net
|
|
276.5
|
|
|
273.4
|
|
|
3.1
|
|
|||
|
|
|
|
|
|
|
|
||||||
|
Liabilities and Equity
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Accrued liabilities
|
|
575.3
|
|
|
563.4
|
|
|
11.9
|
|
|||
|
Income taxes payable
|
|
31.9
|
|
|
34.2
|
|
|
(2.3
|
)
|
|||
|
Retained earnings
|
|
1,216.2
|
|
|
1,222.9
|
|
|
(6.7
|
)
|
|||
|
(in millions)
|
|
|
||||||||||
|
Consolidated Balance Sheets Item
|
|
December 31, 2017 As Reported Balance
|
|
Adoption of ASU 2016-16 Increase/(Decrease)
|
|
January 1, 2018 Revised Balance
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Assets
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Prepaid expenses and other current assets, net
|
|
$
|
312.6
|
|
|
$
|
(5.6
|
)
|
|
$
|
307.0
|
|
|
Other noncurrent assets, net
|
|
156.1
|
|
|
(73.1
|
)
|
|
83.0
|
|
|||
|
|
|
|
|
|
|
|
||||||
|
Liabilities and Equity
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Deferred income taxes
|
|
718.0
|
|
|
(76.0
|
)
|
|
642.0
|
|
|||
|
Retained earnings
|
|
2,316.2
|
|
|
(2.7
|
)
|
|
2,313.5
|
|
|||
|
(in millions)
|
|
|
|
|
|
|
||||||
|
Consolidated Statements of Operations Item
|
|
Three Months Ended June 30, 2017
As Reported
|
|
Adoption of 2017-07 Increase/(Decrease)
|
|
Three Months Ended
June 30, 2017
Revised
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Cost of products sold
|
|
$
|
448.5
|
|
|
$
|
(0.3
|
)
|
|
$
|
448.2
|
|
|
Gross profit
|
|
544.2
|
|
|
0.3
|
|
|
544.5
|
|
|||
|
Selling, general and administrative expense
|
|
417.6
|
|
|
(1.9
|
)
|
|
415.7
|
|
|||
|
Operating loss
|
|
(1,048.0
|
)
|
|
2.2
|
|
|
(1,045.8
|
)
|
|||
|
Other expense (income), net
|
|
7.8
|
|
|
2.2
|
|
|
10.0
|
|
|||
|
(in millions)
|
|
|
|
|
|
|
||||||
|
Consolidated Statements of Operations Item
|
|
Six Months Ended
June 30, 2017
As Reported
|
|
Adoption of 2017-07 Increase/(Decrease)
|
|
Six Months Ended
June 30, 2017
Revised
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Cost of products sold
|
|
$
|
857.0
|
|
|
$
|
(0.8
|
)
|
|
$
|
856.2
|
|
|
Gross profit
|
|
1,036.2
|
|
|
0.8
|
|
|
1,037.0
|
|
|||
|
Selling, general and administrative expense
|
|
822.3
|
|
|
(3.6
|
)
|
|
818.7
|
|
|||
|
Operating loss
|
|
(963.8
|
)
|
|
4.4
|
|
|
(959.4
|
)
|
|||
|
Other expense (income), net
|
|
6.8
|
|
|
4.4
|
|
|
11.2
|
|
|||
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Stock option expense
|
|
$
|
2.7
|
|
|
$
|
2.5
|
|
|
$
|
3.4
|
|
|
$
|
5.2
|
|
|
RSU expense
|
|
(2.6
|
)
|
|
8.0
|
|
|
5.9
|
|
|
15.7
|
|
||||
|
Total stock based compensation expense
|
|
$
|
0.1
|
|
|
$
|
10.5
|
|
|
$
|
9.3
|
|
|
$
|
20.9
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Related deferred income tax benefit
|
|
$
|
—
|
|
|
$
|
2.5
|
|
|
$
|
1.6
|
|
|
$
|
5.8
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Foreign currency translation gains
|
|
$
|
—
|
|
|
$
|
248.2
|
|
|
$
|
—
|
|
|
$
|
304.8
|
|
|
Foreign currency translation losses
|
|
(223.4
|
)
|
|
—
|
|
|
(139.4
|
)
|
|
—
|
|
||||
|
Foreign currency translation gain on hedges of net investments
|
|
31.0
|
|
|
—
|
|
|
12.1
|
|
|
—
|
|
||||
|
Foreign currency translation loss on hedges of net investments
|
|
—
|
|
|
(24.2
|
)
|
|
—
|
|
|
(33.6
|
)
|
||||
|
(in millions)
|
|
Foreign Currency Translation Gain (Loss)
|
|
Gain and (Loss) on Derivative Financial Instruments Designated as Cash Flow Hedges
|
|
Gain and (Loss) on Derivative Financial Instruments
|
|
Net Unrealized Holding Gain (Loss) on Available-for-Sale Securities
|
|
Pension Liability Gain (Loss)
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Balance, net of tax, at December 31, 2017
|
|
$
|
(104.5
|
)
|
|
$
|
(12.6
|
)
|
|
$
|
(127.6
|
)
|
|
$
|
44.3
|
|
|
$
|
(90.6
|
)
|
|
$
|
(291.0
|
)
|
|
Other comprehensive (loss) income before reclassifications and tax impact
|
|
(106.6
|
)
|
|
(4.2
|
)
|
|
29.4
|
|
|
—
|
|
|
2.4
|
|
|
(79.0
|
)
|
||||||
|
Tax (expense) benefit
|
|
(20.7
|
)
|
|
0.5
|
|
|
(14.5
|
)
|
|
|
|
(0.6
|
)
|
|
(35.3
|
)
|
|||||||
|
Other comprehensive (loss) income, net of tax, before reclassifications
|
|
(127.3
|
)
|
|
(3.7
|
)
|
|
14.9
|
|
|
—
|
|
|
1.8
|
|
|
(114.3
|
)
|
||||||
|
Amounts reclassified from accumulated other comprehensive income (loss), net of tax
|
|
—
|
|
|
6.4
|
|
|
—
|
|
|
(44.3
|
)
|
|
2.4
|
|
|
(35.5
|
)
|
||||||
|
Net (decrease) increase in other comprehensive income
|
|
(127.3
|
)
|
|
2.7
|
|
|
14.9
|
|
|
(44.3
|
)
|
|
4.2
|
|
|
(149.8
|
)
|
||||||
|
Balance, net of tax, at June 30, 2018
|
|
$
|
(231.8
|
)
|
|
$
|
(9.9
|
)
|
|
$
|
(112.7
|
)
|
|
$
|
—
|
|
|
$
|
(86.4
|
)
|
|
$
|
(440.8
|
)
|
|
(in millions)
|
|
Foreign Currency Translation Gain (Loss)
|
|
Gain and (Loss) on Derivative Financial Instruments Designated as Cash Flow Hedges
|
|
Gain and (Loss) on Derivative Financial Instruments
|
|
Pension Liability Gain (Loss)
|
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Balance, net of tax, at December 31, 2016
|
|
$
|
(490.5
|
)
|
|
$
|
(3.2
|
)
|
|
$
|
(116.8
|
)
|
|
$
|
(95.2
|
)
|
|
$
|
(705.7
|
)
|
|
Other comprehensive income (loss) before reclassifications and tax impact
|
|
245.8
|
|
|
(2.7
|
)
|
|
(4.2
|
)
|
|
—
|
|
|
238.9
|
|
|||||
|
Tax benefit
|
|
25.4
|
|
|
0.2
|
|
|
0.8
|
|
|
—
|
|
|
26.4
|
|
|||||
|
Other comprehensive income (loss), net of tax, before reclassifications
|
|
271.2
|
|
|
(2.5
|
)
|
|
(3.4
|
)
|
|
—
|
|
|
265.3
|
|
|||||
|
Amounts reclassified from accumulated other comprehensive income, net of tax
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
2.3
|
|
|
2.4
|
|
|||||
|
Net increase (decrease) in other comprehensive income
|
|
271.2
|
|
|
(2.4
|
)
|
|
(3.4
|
)
|
|
2.3
|
|
|
267.7
|
|
|||||
|
Balance, net of tax, at June 30, 2017
|
|
$
|
(219.3
|
)
|
|
$
|
(5.6
|
)
|
|
$
|
(120.2
|
)
|
|
$
|
(92.9
|
)
|
|
$
|
(438.0
|
)
|
|
(in millions)
|
|
|
|
|
|
|
||||
|
Details about AOCI Components
|
|
Amounts Reclassified from AOCI
|
|
Affected Line Item on the Consolidated Statements of Operations
|
||||||
|
|
Three Months Ended
|
|
||||||||
|
|
2018
|
|
2017
|
|
||||||
|
|
|
|
|
|
|
|
||||
|
(Loss) gain on derivative financial instruments:
|
||||||||||
|
Interest rate swaps
|
|
$
|
(0.5
|
)
|
|
$
|
(0.4
|
)
|
|
Interest expense
|
|
Foreign exchange forward contracts
|
|
(4.3
|
)
|
|
0.5
|
|
|
Cost of products sold
|
||
|
Net (loss) gain before tax
|
|
(4.8
|
)
|
|
0.1
|
|
|
|
||
|
Tax impact
|
|
0.7
|
|
|
—
|
|
|
Provision (benefit) for income taxes
|
||
|
Net (loss) gain after tax
|
|
$
|
(4.1
|
)
|
|
$
|
0.1
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Amortization of defined benefit pension and other postemployment benefit items:
|
||||||||||
|
Amortization of prior service benefits
|
|
$
|
—
|
|
|
$
|
0.1
|
|
|
(a)
|
|
Amortization of net actuarial losses
|
|
(1.7
|
)
|
|
(1.7
|
)
|
|
(a)
|
||
|
Net loss before tax
|
|
(1.7
|
)
|
|
(1.6
|
)
|
|
|
||
|
Tax impact
|
|
0.5
|
|
|
0.5
|
|
|
Provision (benefit) for income taxes
|
||
|
Net loss after tax
|
|
$
|
(1.2
|
)
|
|
$
|
(1.1
|
)
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total reclassifications for the period
|
|
$
|
(5.3
|
)
|
|
$
|
(1.0
|
)
|
|
|
|
(in millions)
|
|
|
|
|
|
|
||||
|
Details about AOCI Components
|
|
Amounts Reclassified from AOCI
|
|
Affected Line Item on the Consolidated Statements of Operations
|
||||||
|
|
Six Months Ended
|
|
||||||||
|
|
2018
|
|
2017
|
|
||||||
|
|
|
|
|
|
|
|
||||
|
Loss on derivative financial instruments:
|
||||||||||
|
Interest rate swaps
|
|
$
|
(1.1
|
)
|
|
$
|
(1.1
|
)
|
|
Interest expense
|
|
Foreign exchange forward contracts
|
|
(6.1
|
)
|
|
1.0
|
|
|
Cost of products sold
|
||
|
Net loss before tax
|
|
(7.2
|
)
|
|
(0.1
|
)
|
|
|
||
|
Tax impact
|
|
0.8
|
|
|
—
|
|
|
Provision (benefit) for income taxes
|
||
|
Net loss after tax
|
|
$
|
(6.4
|
)
|
|
$
|
(0.1
|
)
|
|
|
|
|
|
|
|
|
|
|
||||
|
Net realized holding gain on available-for-sale securities:
|
||||||||||
|
Available-for-sale securities
|
|
$
|
45.0
|
|
|
$
|
—
|
|
|
Other expense (income), net
|
|
Tax impact
|
|
(0.7
|
)
|
|
—
|
|
|
Provision (benefit) for income taxes
|
||
|
Net gain after tax
|
|
$
|
44.3
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Amortization of defined benefit pension and other postemployment benefit items:
|
||||||||||
|
Amortization of prior service benefits
|
|
$
|
—
|
|
|
$
|
0.1
|
|
|
(a)
|
|
Amortization of net actuarial losses
|
|
(3.4
|
)
|
|
(3.4
|
)
|
|
(a)
|
||
|
Net loss before tax
|
|
(3.4
|
)
|
|
(3.3
|
)
|
|
|
||
|
Tax impact
|
|
1.0
|
|
|
1.0
|
|
|
Provision (benefit) for income taxes
|
||
|
Net loss after tax
|
|
$
|
(2.4
|
)
|
|
$
|
(2.3
|
)
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total reclassifications for the period
|
|
$
|
35.5
|
|
|
$
|
(2.4
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
|
||
|
|
|
|
|
Useful Life
|
||
|
(in millions, except for useful life)
|
|
Amount
|
|
(in years)
|
||
|
|
|
|
|
|
||
|
Customer relationships
|
|
$
|
17.5
|
|
|
15
|
|
Developed technology and patents
|
|
63.4
|
|
|
15
|
|
|
Trade names and trademarks
|
|
12.8
|
|
|
Indefinite
|
|
|
Total
|
|
$
|
93.7
|
|
|
|
|
|
|
|
|
Weighted Average
|
||
|
|
|
|
|
Useful Life
|
||
|
(in millions, except for useful life)
|
|
Amount
|
|
(in years)
|
||
|
|
|
|
|
|
||
|
Customer relationships
|
|
$
|
18.1
|
|
|
15
|
|
Developed technology and patents
|
|
22.4
|
|
|
15
|
|
|
Trade names and trademarks
|
|
8.5
|
|
|
Indefinite
|
|
|
Total
|
|
$
|
49.0
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Technologies & Equipment
|
|
$
|
548.8
|
|
|
$
|
532.8
|
|
|
$
|
1,057.1
|
|
|
$
|
1,011.8
|
|
|
Consumables
|
|
493.3
|
|
|
459.9
|
|
|
941.1
|
|
|
881.4
|
|
||||
|
Total net sales
|
|
$
|
1,042.1
|
|
|
$
|
992.7
|
|
|
$
|
1,998.2
|
|
|
$
|
1,893.2
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Technologies & Equipment
|
|
$
|
539.4
|
|
|
$
|
523.1
|
|
|
$
|
1,037.4
|
|
|
$
|
991.0
|
|
|
Consumables
|
|
493.3
|
|
|
459.9
|
|
|
941.1
|
|
|
881.4
|
|
||||
|
Total net sales, excluding precious metal content
|
|
1,032.7
|
|
|
983.0
|
|
|
1,978.5
|
|
|
1,872.4
|
|
||||
|
Precious metal content of sales
|
|
9.4
|
|
|
9.7
|
|
|
19.7
|
|
|
20.8
|
|
||||
|
Total net sales, including precious metal content
|
|
$
|
1,042.1
|
|
|
$
|
992.7
|
|
|
$
|
1,998.2
|
|
|
$
|
1,893.2
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Technologies & Equipment
|
|
$
|
77.1
|
|
|
$
|
98.0
|
|
|
$
|
151.8
|
|
|
$
|
151.9
|
|
|
Consumables
|
|
146.0
|
|
|
122.8
|
|
|
253.2
|
|
|
238.9
|
|
||||
|
Segment adjusted operating income before income taxes and interest
|
|
223.1
|
|
|
220.8
|
|
|
405.0
|
|
|
390.8
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Reconciling items expense (income):
|
|
|
|
|
|
|
|
|
|
|
||||||
|
All Other
(a)
|
|
50.5
|
|
|
46.3
|
|
|
101.8
|
|
|
82.3
|
|
||||
|
Goodwill impairment
|
|
1,085.8
|
|
|
1,092.9
|
|
|
1,085.8
|
|
|
1,092.9
|
|
||||
|
Restructuring and other costs
|
|
188.9
|
|
|
81.7
|
|
|
199.1
|
|
|
84.8
|
|
||||
|
Interest expense
|
|
9.6
|
|
|
9.6
|
|
|
18.2
|
|
|
18.9
|
|
||||
|
Interest income
|
|
(0.4
|
)
|
|
(0.6
|
)
|
|
(1.0
|
)
|
|
(1.3
|
)
|
||||
|
Other expense (income), net
|
|
(1.0
|
)
|
|
7.8
|
|
|
(35.1
|
)
|
|
6.8
|
|
||||
|
Amortization of intangible assets
|
|
50.2
|
|
|
46.5
|
|
|
100.1
|
|
|
91.8
|
|
||||
|
Depreciation resulting from the fair value step-up of property, plant and equipment from business combinations
|
|
1.8
|
|
|
1.4
|
|
|
3.6
|
|
|
2.8
|
|
||||
|
Loss before income taxes
|
|
$
|
(1,162.3
|
)
|
|
$
|
(1,064.8
|
)
|
|
$
|
(1,067.5
|
)
|
|
$
|
(988.2
|
)
|
|
(in millions)
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
|
|
|
|
|
||||
|
Finished goods
|
|
$
|
441.6
|
|
|
$
|
387.6
|
|
|
Work-in-process
|
|
88.4
|
|
|
90.4
|
|
||
|
Raw materials and supplies
|
|
136.3
|
|
|
145.1
|
|
||
|
Inventories, net
|
|
$
|
666.3
|
|
|
$
|
623.1
|
|
|
Defined Benefit Plans
|
|
Three Months Ended
|
|
Six Months Ended
|
|
Location on Consolidated Statements of Operations
|
||||||||||||
|
(in millions)
|
|
2018
|
|
2017
(a)
|
|
2018
|
|
2017 (a)
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Service cost
|
|
$
|
1.9
|
|
|
$
|
2.0
|
|
|
$
|
3.7
|
|
|
$
|
3.7
|
|
|
Cost of products sold
|
|
Service cost
|
|
2.1
|
|
|
1.9
|
|
|
4.5
|
|
|
4.0
|
|
|
Selling, general and administrative expenses
|
||||
|
Interest cost
|
|
1.9
|
|
|
1.8
|
|
|
3.6
|
|
|
3.5
|
|
|
Other expense (income), net
|
||||
|
Expected return on plan assets
|
|
(1.3
|
)
|
|
(1.2
|
)
|
|
(2.7
|
)
|
|
(2.3
|
)
|
|
Other expense (income), net
|
||||
|
Amortization of prior service credit
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
Other expense (income), net
|
||||
|
Amortization of net actuarial loss
|
|
1.7
|
|
|
1.7
|
|
|
3.4
|
|
|
3.3
|
|
|
Other expense (income), net
|
||||
|
Net periodic benefit cost
|
|
$
|
6.2
|
|
|
$
|
6.1
|
|
|
$
|
12.4
|
|
|
$
|
12.1
|
|
|
|
|
(in millions)
|
|
Pension
Benefits
|
||
|
|
|
|
||
|
Actual contributions through June 30, 2018
|
|
$
|
7.7
|
|
|
Expected contributions for the remainder of the year
|
|
8.4
|
|
|
|
Total actual and expected contributions
|
|
$
|
16.1
|
|
|
|
|
Severance
|
||||||||||||||
|
(in millions)
|
|
2016 and
Prior Plans |
|
2017 Plans
|
|
2018 Plans
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Balance at December 31, 2017
|
|
$
|
7.7
|
|
|
$
|
48.2
|
|
|
$
|
—
|
|
|
$
|
55.9
|
|
|
Provisions
|
|
0.7
|
|
|
0.2
|
|
|
10.8
|
|
|
11.7
|
|
||||
|
Amounts applied
|
|
(1.8
|
)
|
|
(7.7
|
)
|
|
(5.9
|
)
|
|
(15.4
|
)
|
||||
|
Change in estimates
|
|
(0.1
|
)
|
|
(1.8
|
)
|
|
(0.2
|
)
|
|
(2.1
|
)
|
||||
|
Balance at June 30, 2018
|
|
$
|
6.5
|
|
|
$
|
38.9
|
|
|
$
|
4.7
|
|
|
$
|
50.1
|
|
|
|
|
Lease/Contract Terminations
|
||||||||||
|
(in millions)
|
|
2016 and
Prior Plans |
|
2017 Plans
|
|
Total
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Balance at December 31, 2017
|
|
$
|
0.4
|
|
|
$
|
0.2
|
|
|
$
|
0.6
|
|
|
Provisions
|
|
0.3
|
|
|
(0.1
|
)
|
|
0.2
|
|
|||
|
Amounts applied
|
|
(0.5
|
)
|
|
(0.1
|
)
|
|
(0.6
|
)
|
|||
|
Balance at June 30, 2018
|
|
$
|
0.2
|
|
|
$
|
—
|
|
|
$
|
0.2
|
|
|
|
|
Other Restructuring Costs
|
||||||||||||||
|
(in millions)
|
|
2016 and
Prior Plans |
|
2017 Plans
|
|
2018 Plans
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Balance at December 31, 2017
|
|
$
|
2.1
|
|
|
$
|
1.7
|
|
|
$
|
—
|
|
|
$
|
3.8
|
|
|
Provisions
|
|
0.2
|
|
|
0.4
|
|
|
0.2
|
|
|
0.8
|
|
||||
|
Amounts applied
|
|
(1.5
|
)
|
|
(0.4
|
)
|
|
(0.2
|
)
|
|
(2.1
|
)
|
||||
|
Balance at June 30, 2018
|
|
$
|
0.8
|
|
|
$
|
1.7
|
|
|
$
|
—
|
|
|
$
|
2.5
|
|
|
(in millions)
|
|
December 31, 2017
|
|
Provisions
|
|
Amounts
Applied
|
|
Change in Estimates
|
|
June 30, 2018
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Technologies & Equipment
|
|
$
|
46.9
|
|
|
$
|
7.2
|
|
|
$
|
(7.9
|
)
|
|
$
|
(1.8
|
)
|
|
$
|
44.4
|
|
|
Consumables
|
|
13.3
|
|
|
4.1
|
|
|
(8.2
|
)
|
|
(0.3
|
)
|
|
8.9
|
|
|||||
|
All Other
|
|
0.1
|
|
|
1.4
|
|
|
(2.0
|
)
|
|
—
|
|
|
(0.5
|
)
|
|||||
|
Total
|
|
$
|
60.3
|
|
|
$
|
12.7
|
|
|
$
|
(18.1
|
)
|
|
$
|
(2.1
|
)
|
|
$
|
52.8
|
|
|
|
|
Aggregate
Notional
Amount
|
|
Aggregate Notional Amount Maturing within 12 Months
|
||||
|
|
|
|
||||||
|
(in millions)
|
|
|
||||||
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts
|
|
$
|
301.4
|
|
|
$
|
232.7
|
|
|
Interest rate swaps
|
|
113.2
|
|
|
—
|
|
||
|
Total derivative instruments designated as cash flow hedges
|
|
$
|
414.6
|
|
|
$
|
232.7
|
|
|
|
|
June 30, 2018
|
||||||||||||
|
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Effective Portion Reclassified from AOCI into Income (Expense)
|
|
Ineffective Portion Recognized in Income (Expense)
|
||||||
|
|
|
|
|
|
||||||||||
|
(in millions)
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||
|
Effective Portion:
|
|
|
|
|
|
|
|
|
||||||
|
Interest rate swaps
|
|
$
|
—
|
|
|
Interest expense
|
|
$
|
(0.6
|
)
|
|
$
|
—
|
|
|
Foreign exchange forward contracts
|
|
2.8
|
|
|
Cost of products sold
|
|
(4.2
|
)
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
|
Ineffective Portion:
|
|
|
|
|
|
|
|
|
||||||
|
Foreign exchange forward contracts
|
|
—
|
|
|
Other expense (income), net
|
|
—
|
|
|
(0.3
|
)
|
|||
|
Total in cash flow hedging
|
|
$
|
2.8
|
|
|
|
|
$
|
(4.8
|
)
|
|
$
|
(0.3
|
)
|
|
|
|
June 30, 2017
|
||||||||||||
|
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Effective Portion Reclassified from AOCI into Income (Expense)
|
|
Ineffective Portion Recognized in Income (Expense)
|
||||||
|
|
|
|
|
|
||||||||||
|
(in millions)
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||
|
Effective Portion:
|
|
|
|
|
|
|
|
|
||||||
|
Interest rate swaps
|
|
$
|
(0.2
|
)
|
|
Interest expense
|
|
$
|
(0.4
|
)
|
|
$
|
—
|
|
|
Foreign exchange forward contracts
|
|
(1.2
|
)
|
|
Cost of products sold
|
|
0.5
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
|
Ineffective Portion:
|
|
|
|
|
|
|
|
|
||||||
|
Foreign exchange forward contracts
|
|
—
|
|
|
Other expense (income), net
|
|
—
|
|
|
(0.2
|
)
|
|||
|
Total for cash flow hedging
|
|
$
|
(1.4
|
)
|
|
|
|
$
|
0.1
|
|
|
$
|
(0.2
|
)
|
|
|
|
June 30, 2018
|
||||||||||||
|
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Effective Portion Reclassified from AOCI into Income (Expense)
|
|
Ineffective Portion Recognized in Income (Expense)
|
||||||
|
|
|
|
|
|
||||||||||
|
(in millions)
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||
|
Effective Portion:
|
|
|
|
|
|
|
|
|
||||||
|
Interest rate swaps
|
|
$
|
(0.1
|
)
|
|
Interest expense
|
|
$
|
(1.1
|
)
|
|
$
|
—
|
|
|
Foreign exchange forward contracts
|
|
(4.1
|
)
|
|
Cost of products sold
|
|
(6.1
|
)
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
|
Ineffective Portion:
|
|
|
|
|
|
|
|
|
||||||
|
Foreign exchange forward contracts
|
|
—
|
|
|
Other expense (income), net
|
|
—
|
|
|
(0.4
|
)
|
|||
|
Total in cash flow hedging
|
|
$
|
(4.2
|
)
|
|
|
|
$
|
(7.2
|
)
|
|
$
|
(0.4
|
)
|
|
|
|
June 30, 2017
|
||||||||||||
|
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Effective Portion Reclassified from AOCI into Income (Expense)
|
|
Ineffective Portion Recognized in Income (Expense)
|
||||||
|
|
|
|
|
|
||||||||||
|
(in millions)
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||
|
Effective Portion:
|
|
|
|
|
|
|
|
|
||||||
|
Interest rate swaps
|
|
$
|
—
|
|
|
Interest expense
|
|
$
|
(1.1
|
)
|
|
$
|
—
|
|
|
Foreign exchange forward contracts
|
|
(2.7
|
)
|
|
Cost of products sold
|
|
1.0
|
|
|
—
|
|
|||
|
|
|
|
|
|
|
|
|
|
||||||
|
Ineffective Portion:
|
|
|
|
|
|
|
|
|
||||||
|
Foreign exchange forward contracts
|
|
—
|
|
|
Other expense (income), net
|
|
—
|
|
|
(0.5
|
)
|
|||
|
Total for cash flow hedging
|
|
$
|
(2.7
|
)
|
|
|
|
$
|
(0.1
|
)
|
|
$
|
(0.5
|
)
|
|
|
|
Aggregate
Notional Amount |
|
Aggregate Notional Amount Maturing within 12 Months
|
||||
|
|
|
|
||||||
|
(in millions)
|
|
|
||||||
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts
|
|
$
|
600.6
|
|
|
$
|
299.5
|
|
|
Cross currency basis swaps
|
|
286.5
|
|
|
—
|
|
||
|
Total for instruments not designated as hedges
|
|
$
|
887.1
|
|
|
$
|
299.5
|
|
|
|
|
June 30, 2018
|
||||||||
|
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Recognized in Income (Expense)
|
||||
|
|
|
|
|
|||||||
|
(in millions)
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||
|
Effective Portion:
|
|
|
|
|
|
|
||||
|
Cross currency basis swaps
|
|
$
|
16.0
|
|
|
Interest expense
|
|
$
|
1.9
|
|
|
Foreign exchange forward contracts
|
|
31.3
|
|
|
Other expense (income), net
|
|
3.9
|
|
||
|
Total for net investment hedging
|
|
$
|
47.3
|
|
|
|
|
$
|
5.8
|
|
|
|
|
June 30, 2017
|
||||||||
|
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Recognized in Income (Expense)
|
||||
|
|
|
|
|
|||||||
|
(in millions)
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||
|
Effective Portion:
|
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts
|
|
$
|
(2.4
|
)
|
|
Other expense (income), net
|
|
$
|
0.3
|
|
|
Total for net investment hedging
|
|
$
|
(2.4
|
)
|
|
|
|
$
|
0.3
|
|
|
|
|
June 30, 2018
|
||||||||
|
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Recognized in Income (Expense)
|
||||
|
|
|
|
|
|||||||
|
(in millions)
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||
|
Effective Portion:
|
|
|
|
|
|
|
||||
|
Cross currency basis swaps
|
|
$
|
9.6
|
|
|
Interest expense
|
|
$
|
3.6
|
|
|
|
|
|
|
Other expense (income), net
|
|
(6.6
|
)
|
|||
|
Foreign exchange forward contracts
|
|
19.8
|
|
|
Other expense (income), net
|
|
5.4
|
|
||
|
Total for net investment hedging
|
|
$
|
29.4
|
|
|
|
|
$
|
2.4
|
|
|
|
|
June 30, 2017
|
||||||||
|
|
|
Gain (Loss) in AOCI
|
|
Consolidated Statements of Operations Location
|
|
Recognized in Income (Expense)
|
||||
|
|
|
|
|
|||||||
|
(in millions)
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
||||
|
Effective Portion:
|
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts
|
|
$
|
(4.2
|
)
|
|
Other expense (income), net
|
|
$
|
0.8
|
|
|
Total for net investment hedging
|
|
$
|
(4.2
|
)
|
|
|
|
$
|
0.8
|
|
|
|
|
Aggregate
Notional
Amount
|
|
Aggregate Notional Amount Maturing within 12 Months
|
||||
|
|
|
|
||||||
|
(in millions)
|
|
|
||||||
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts
|
|
$
|
388.0
|
|
|
$
|
388.0
|
|
|
Total for instruments not designated as hedges
|
|
$
|
388.0
|
|
|
$
|
388.0
|
|
|
|
|
Consolidated Statements of Operations Location
|
|
Gain (Loss) Recognized
|
||||||
|
|
|
|
Three Months Ended
|
|||||||
|
(in millions)
|
|
|
2018
|
|
2017
|
|||||
|
|
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts
(a)
|
|
Other expense (income), net
|
|
$
|
3.6
|
|
|
$
|
(2.3
|
)
|
|
Total for instruments not designated as hedges
|
|
|
|
$
|
3.6
|
|
|
$
|
(2.3
|
)
|
|
|
|
Consolidated Statements of Operations Location
|
|
Gain (Loss) Recognized
|
||||||
|
|
|
|
Six Months Ended
|
|||||||
|
(in millions)
|
|
|
2018
|
|
2017
|
|||||
|
|
|
|
|
|
|
|
||||
|
Foreign exchange forward contracts
(a)
|
|
Other expense (income), net
|
|
$
|
4.3
|
|
|
$
|
(5.1
|
)
|
|
Total for instruments not designated as hedges
|
|
|
|
$
|
4.3
|
|
|
$
|
(5.1
|
)
|
|
|
|
June 30, 2018
|
||||||||||||||
|
(in millions)
|
|
Prepaid
Expenses
and Other
Current Assets, Net
|
|
Other
Noncurrent
Assets, Net
|
|
Accrued
Liabilities
|
|
Other
Noncurrent
Liabilities
|
||||||||
|
Designated as Hedges
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Foreign exchange forward contracts
|
|
$
|
11.4
|
|
|
$
|
10.4
|
|
|
$
|
6.5
|
|
|
$
|
1.0
|
|
|
Interest rate swaps
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
||||
|
Cross currency basis swaps
|
|
—
|
|
|
3.0
|
|
|
—
|
|
|
—
|
|
||||
|
Total
|
|
$
|
11.4
|
|
|
$
|
13.4
|
|
|
$
|
6.8
|
|
|
$
|
1.0
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Not Designated as Hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Foreign exchange forward contracts
|
|
$
|
2.7
|
|
|
$
|
—
|
|
|
$
|
4.3
|
|
|
$
|
—
|
|
|
Total
|
|
$
|
2.7
|
|
|
$
|
—
|
|
|
$
|
4.3
|
|
|
$
|
—
|
|
|
|
|
December 31, 2017
|
||||||||||||||
|
(in millions)
|
|
Prepaid
Expenses and Other Current Assets, Net |
|
Other
Noncurrent
Assets, Net
|
|
Accrued
Liabilities
|
|
Other
Noncurrent
Liabilities
|
||||||||
|
Designated as Hedges
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Foreign exchange forward contracts
|
|
$
|
1.4
|
|
|
$
|
—
|
|
|
$
|
13.4
|
|
|
$
|
4.5
|
|
|
Interest rate swaps
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
0.1
|
|
||||
|
Total
|
|
$
|
1.4
|
|
|
$
|
—
|
|
|
$
|
13.7
|
|
|
$
|
4.6
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Not Designated as Hedges
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Foreign exchange forward contracts
|
|
$
|
3.4
|
|
|
$
|
—
|
|
|
$
|
3.7
|
|
|
$
|
—
|
|
|
Total
|
|
$
|
3.4
|
|
|
$
|
—
|
|
|
$
|
3.7
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset on the Consolidated Balance Sheets
|
|
|
||||||||||||||
|
(in millions)
|
|
Gross Amounts Recognized
|
|
Gross Amount Offset on the Consolidated Balance Sheets
|
|
Net Amounts Presented
on the Consolidated Balance Sheets
|
|
Financial Instruments
|
|
Cash Collateral Received/Pledged
|
|
Net Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Foreign exchange forward contracts
|
|
$
|
24.9
|
|
|
$
|
—
|
|
|
$
|
24.9
|
|
|
$
|
(9.5
|
)
|
|
$
|
—
|
|
|
$
|
15.4
|
|
|
Cross currency basis swaps
|
|
3.0
|
|
|
—
|
|
|
3.0
|
|
|
(2.7
|
)
|
|
—
|
|
|
0.3
|
|
||||||
|
Total Assets
|
|
$
|
27.9
|
|
|
$
|
—
|
|
|
$
|
27.9
|
|
|
$
|
(12.2
|
)
|
|
$
|
—
|
|
|
$
|
15.7
|
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset on the Consolidated Balance Sheets
|
|
|
||||||||||||||
|
(in millions)
|
|
Gross Amounts Recognized
|
|
Gross Amount Offset on the Consolidated Balance Sheets
|
|
Net Amounts Presented
on the Consolidated Balance Sheets
|
|
Financial Instruments
|
|
Cash Collateral Received/Pledged
|
|
Net Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Foreign exchange forward contracts
|
|
$
|
12.2
|
|
|
$
|
—
|
|
|
$
|
12.2
|
|
|
$
|
(12.0
|
)
|
|
$
|
—
|
|
|
$
|
0.2
|
|
|
Interest rate swaps
|
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|
(0.2
|
)
|
|
—
|
|
|
0.1
|
|
||||||
|
Total Liabilities
|
|
$
|
12.5
|
|
|
$
|
—
|
|
|
$
|
12.5
|
|
|
$
|
(12.2
|
)
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset on the Consolidated Balance Sheets
|
|
|
||||||||||||||
|
(in millions)
|
|
Gross Amounts Recognized
|
|
Gross Amount Offset on the Consolidated Balance Sheets
|
|
Net Amounts Presented on the Consolidated Balance Sheets
|
|
Financial Instruments
|
|
Cash Collateral Received/Pledged
|
|
Net Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Foreign exchange forward contracts
|
|
$
|
4.8
|
|
|
$
|
—
|
|
|
$
|
4.8
|
|
|
$
|
(3.9
|
)
|
|
$
|
—
|
|
|
$
|
0.9
|
|
|
Total Assets
|
|
$
|
4.8
|
|
|
$
|
—
|
|
|
$
|
4.8
|
|
|
$
|
(3.9
|
)
|
|
$
|
—
|
|
|
$
|
0.9
|
|
|
|
|
|
|
|
|
|
|
Gross Amounts Not Offset on the Consolidated Balance Sheets
|
|
|
||||||||||||||
|
(in millions)
|
|
Gross Amounts Recognized
|
|
Gross Amount Offset on the Consolidated Balance Sheets
|
|
Net Amounts Presented on the Consolidated Balance Sheets
|
|
Financial Instruments
|
|
Cash Collateral Received/Pledged
|
|
Net Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Foreign exchange forward contracts
|
|
$
|
21.6
|
|
|
$
|
—
|
|
|
$
|
21.6
|
|
|
$
|
(3.8
|
)
|
|
$
|
—
|
|
|
$
|
17.8
|
|
|
Interest rate swaps
|
|
0.4
|
|
|
—
|
|
|
0.4
|
|
|
(0.1
|
)
|
|
—
|
|
|
0.3
|
|
||||||
|
Total Liabilities
|
|
$
|
22.0
|
|
|
$
|
—
|
|
|
$
|
22.0
|
|
|
$
|
(3.9
|
)
|
|
$
|
—
|
|
|
$
|
18.1
|
|
|
|
|
June 30, 2018
|
||||||||||||||
|
(in millions)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Assets
|
|
|
|
|
|
|
|
|
||||||||
|
Cross currency basis swaps
|
|
$
|
3.0
|
|
|
$
|
—
|
|
|
$
|
3.0
|
|
|
$
|
—
|
|
|
Foreign exchange forward contracts
|
|
24.5
|
|
|
—
|
|
|
24.5
|
|
|
—
|
|
||||
|
Total assets
|
|
$
|
27.5
|
|
|
$
|
—
|
|
|
$
|
27.5
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Interest rate swaps
|
|
$
|
0.3
|
|
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
—
|
|
|
Foreign exchange forward contracts
|
|
11.8
|
|
|
—
|
|
|
11.8
|
|
|
—
|
|
||||
|
Contingent considerations on acquisitions
|
|
8.8
|
|
|
—
|
|
|
—
|
|
|
8.8
|
|
||||
|
Total liabilities
|
|
$
|
20.9
|
|
|
$
|
—
|
|
|
$
|
12.1
|
|
|
$
|
8.8
|
|
|
|
|
December 31, 2017
|
||||||||||||||
|
(in millions)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Assets
|
|
|
|
|
|
|
|
|
||||||||
|
Foreign exchange forward contracts
|
|
$
|
4.8
|
|
|
$
|
—
|
|
|
$
|
4.8
|
|
|
$
|
—
|
|
|
Available-for-sale security
|
|
54.4
|
|
|
—
|
|
|
54.4
|
|
|
—
|
|
||||
|
Total assets
|
|
$
|
59.2
|
|
|
$
|
—
|
|
|
$
|
59.2
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Interest rate swaps
|
|
$
|
0.4
|
|
|
$
|
—
|
|
|
$
|
0.4
|
|
|
$
|
—
|
|
|
Foreign exchange forward contracts
|
|
21.6
|
|
|
—
|
|
|
21.6
|
|
|
—
|
|
||||
|
Contingent considerations on acquisitions
|
|
8.6
|
|
|
—
|
|
|
—
|
|
|
8.6
|
|
||||
|
Total liabilities
|
|
$
|
30.6
|
|
|
$
|
—
|
|
|
$
|
22.0
|
|
|
$
|
8.6
|
|
|
|
|
Earn-out
|
||
|
(in millions)
|
|
Obligations
|
||
|
|
|
|
||
|
Balance at December 31, 2017
|
|
$
|
8.6
|
|
|
Fair value adjustment:
|
|
|
||
|
Reported in Other expense (income), net
|
|
0.4
|
|
|
|
Effect of exchange rate changes
|
|
(0.2
|
)
|
|
|
Balance at June 30, 2018
|
|
$
|
8.8
|
|
|
•
|
The equipment reporting units were negatively affected in connection with the continued transition of the Company’s distribution relationships primarily in the U.S. from exclusive to non-exclusive. The Company’s expectations for revenue growth from its non-exclusive distribution relationships, which replaced its former long-term exclusive distribution relationship, were not met. As a result, the Company’s forecasts of current and future third-party demand have been reduced as the Company’s U.S. distributors continue to offer and promote competitive alternatives to the Company’s full CAD/CAM systems and lower-priced alternatives to the Imaging reporting units’ products.
|
|
•
|
The Imaging reporting unit observed revenue and operating margins being negatively impacted by aggressive competition with a focus on value-based products in the marketplace as opposed to the reporting unit’s premium products. This has resulted in increased competition from low-cost products in certain regions throughout the world causing the reporting unit to offer additional product features at the current price levels and to offer additional promotions and reduce its future sales forecasts.
|
|
•
|
The CAD/CAM and Imaging reporting units have also experienced lower than expected sales with respect to higher margin products as well as a regional shift in sales to emerging markets each of which has negatively impacted the reporting units’ overall operating margins as compared to the original forecasts for the period and for future sales forecasts.
|
|
•
|
The equipment reporting units were also further impacted by the unfavorable change in the discount rate due primarily to a higher risk factor, which represents management’s assessment of increased risk with respect to the CAD/CAM and Imaging reporting units’ forecasts primarily due to the factors described above, and to a lesser extent a higher risk-free interest rate for all reporting units.
|
|
•
|
The increased reduction of inventory being held by the Company’s U.S. distributors in the second quarter, which was larger than anticipated for the period, and planned further reductions of inventory, will impact the Company’s near-term results.
|
|
(in millions)
|
|
Technologies & Equipment
|
|
Consumables
|
|
Total
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Balance at December 31, 2017
|
|
$
|
3,660.6
|
|
|
$
|
878.6
|
|
|
$
|
4,539.2
|
|
|
Acquisition related additions
|
|
—
|
|
|
66.5
|
|
|
66.5
|
|
|||
|
Measurement period adjustments on prior acquisitions
|
|
—
|
|
|
0.5
|
|
|
0.5
|
|
|||
|
Impairment
|
|
(1,017.2
|
)
|
|
(68.5
|
)
|
|
(1,085.7
|
)
|
|||
|
Effects of exchange rate changes
|
|
(51.3
|
)
|
|
(11.4
|
)
|
|
(62.7
|
)
|
|||
|
Balance at June 30, 2018
|
|
$
|
2,592.1
|
|
|
$
|
865.7
|
|
|
$
|
3,457.8
|
|
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
(in millions)
|
|
Gross Carrying Amount
|
|
Cumulative Impairment
|
|
Net Carrying Amount
|
|
Gross Carrying Amount
|
|
Cumulative Impairment
|
|
Net Carrying Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Technologies & Equipment
|
|
$
|
5,260.2
|
|
|
$
|
(2,668.1
|
)
|
|
$
|
2,592.1
|
|
|
$
|
5,311.5
|
|
|
$
|
(1,650.9
|
)
|
|
$
|
3,660.6
|
|
|
Consumables
|
|
934.2
|
|
|
(68.5
|
)
|
|
865.7
|
|
|
878.6
|
|
|
—
|
|
|
878.6
|
|
||||||
|
Total effect of cumulative impairment
|
|
6,194.4
|
|
|
(2,736.6
|
)
|
|
3,457.8
|
|
|
6,190.1
|
|
|
(1,650.9
|
)
|
|
4,539.2
|
|
||||||
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
|
(in millions)
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Patents and developed technology
|
|
$
|
1,416.1
|
|
|
$
|
(353.5
|
)
|
|
$
|
1,062.6
|
|
|
$
|
1,385.5
|
|
|
$
|
(305.0
|
)
|
|
$
|
1,080.5
|
|
|
Trademarks
|
|
82.6
|
|
|
(61.5
|
)
|
|
21.1
|
|
|
76.4
|
|
|
(46.5
|
)
|
|
29.9
|
|
||||||
|
Licensing agreements
|
|
36.1
|
|
|
(25.4
|
)
|
|
10.7
|
|
|
31.2
|
|
|
(24.8
|
)
|
|
6.4
|
|
||||||
|
Customer relationships
|
|
1,098.8
|
|
|
(301.8
|
)
|
|
797.0
|
|
|
1,109.1
|
|
|
(272.0
|
)
|
|
837.1
|
|
||||||
|
Total definite-lived
|
|
$
|
2,633.6
|
|
|
$
|
(742.2
|
)
|
|
$
|
1,891.4
|
|
|
$
|
2,602.2
|
|
|
$
|
(648.3
|
)
|
|
$
|
1,953.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Indefinite-lived tradenames and trademarks
|
|
$
|
655.4
|
|
|
$
|
—
|
|
|
$
|
655.4
|
|
|
$
|
846.8
|
|
|
$
|
—
|
|
|
$
|
846.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Total identifiable intangible assets
|
|
$
|
3,289.0
|
|
|
$
|
(742.2
|
)
|
|
$
|
2,546.8
|
|
|
$
|
3,449.0
|
|
|
$
|
(648.3
|
)
|
|
$
|
2,800.7
|
|
|
•
|
For the three months ended June 30, 2018, the Company reported a sales increase of
5.0%
compared to the three months ended June 30, 2017. On a constant currency basis sales
increased
1.3%
compared to the same year ago period.
|
|
•
|
On a geographic basis, the Company generated constant currency sales growth of
4.2%
in the Rest of World region, a decline of
1.4%
in Europe, and growth in the United States of
2.3%
for the three month period ended June 30, 2018.
|
|
•
|
For the three months ended June 30, 2018, the Company generated a loss per diluted share of $
4.98
compared to a loss per diluted share of
$4.58
for the three months ended June 30, 2017. On an adjusted basis (a non-US GAAP measure as reconciled under Net income attributable to Dentsply Sirona below) for the three months ended June 30, 2018 earnings per diluted share was
$0.60
as compared to
$0.65
earnings per diluted share for the three months ended June 30, 2017.
|
|
•
|
Cash flow from operations for the first six months of 2018 was $
172.0 million
, as compared to $
208.7 million
in the first six months of 2017.
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net sales
|
|
$
|
1,042.1
|
|
|
$
|
992.7
|
|
|
$
|
49.4
|
|
|
5.0
|
%
|
|
Less: precious metal content of sales
|
|
9.4
|
|
|
9.7
|
|
|
(0.3
|
)
|
|
(3.1
|
%)
|
|||
|
Net sales, excluding precious metal content
|
|
$
|
1,032.7
|
|
|
$
|
983.0
|
|
|
$
|
49.7
|
|
|
5.1
|
%
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|
|
|||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
United States
|
|
$
|
337.1
|
|
|
$
|
330.1
|
|
|
$
|
7.0
|
|
|
2.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Europe
|
|
419.4
|
|
|
395.0
|
|
|
24.4
|
|
|
6.2
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Rest of World
|
|
276.2
|
|
|
257.9
|
|
|
18.3
|
|
|
7.1
|
%
|
|||
|
|
|
Three Months Ended
|
||||||||||||||
|
|
|
June 30, 2018
|
||||||||||||||
|
(in millions)
|
|
United States
|
|
Europe
|
|
Rest of World
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net sales
|
|
$
|
338.4
|
|
|
$
|
426.7
|
|
|
$
|
277.0
|
|
|
$
|
1,042.1
|
|
|
Less: precious metal content of sales
|
|
1.3
|
|
|
7.3
|
|
|
0.8
|
|
|
9.4
|
|
||||
|
Net sales, excluding precious metal content
|
|
337.1
|
|
|
419.4
|
|
|
276.2
|
|
|
1,032.7
|
|
||||
|
Acquisition related adjustments
(a)
|
|
2.1
|
|
|
—
|
|
|
—
|
|
|
2.1
|
|
||||
|
Non-US GAAP net sales, excluding precious metal content
|
|
$
|
339.2
|
|
|
$
|
419.4
|
|
|
$
|
276.2
|
|
|
$
|
1,034.8
|
|
|
|
|
Three Months Ended
|
||||||||||||||
|
|
|
June 30, 2017
|
||||||||||||||
|
(in millions)
|
|
United States
|
|
Europe
|
|
Rest of World
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net sales
|
|
$
|
331.6
|
|
|
$
|
402.2
|
|
|
$
|
258.9
|
|
|
$
|
992.7
|
|
|
Less: precious metal content of sales
|
|
1.5
|
|
|
7.2
|
|
|
1.0
|
|
|
9.7
|
|
||||
|
Net sales, excluding precious metal content
|
|
330.1
|
|
|
395.0
|
|
|
257.9
|
|
|
983.0
|
|
||||
|
Merger related adjustments
(a)
|
|
1.5
|
|
|
—
|
|
|
—
|
|
|
1.5
|
|
||||
|
Non-US GAAP net sales, excluding precious metal content
|
|
$
|
331.6
|
|
|
$
|
395.0
|
|
|
$
|
257.9
|
|
|
$
|
984.5
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|
|
|||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Gross profit
|
|
$
|
552.8
|
|
|
$
|
544.2
|
|
|
$
|
8.6
|
|
|
1.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Gross profit as a percentage of net sales, including precious metal content
|
|
53.0
|
%
|
|
54.8
|
%
|
|
|
|
|
|
|
|||
|
Gross profit as a percentage of net sales, excluding precious metal content
|
|
53.5
|
%
|
|
55.4
|
%
|
|
|
|
|
|
|
|||
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|
|
|||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Selling, general and administrative expenses (“SG&A”)
|
|
$
|
432.2
|
|
|
$
|
417.6
|
|
|
$
|
14.6
|
|
|
3.5
|
%
|
|
Goodwill impairment
|
|
1,085.8
|
|
|
1,092.9
|
|
|
(7.1
|
)
|
|
(0.6
|
%)
|
|||
|
Restructuring and other costs
|
|
188.9
|
|
|
81.7
|
|
|
107.2
|
|
|
NM
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
|
SG&A as a percentage of net sales, including precious metal content
|
|
41.5
|
%
|
|
42.1
|
%
|
|
|
|
|
|
|
|||
|
SG&A as a percentage of net sales, excluding precious metal content
|
|
41.9
|
%
|
|
42.5
|
%
|
|
|
|
|
|
|
|||
|
|
|
Three Months Ended June 30,
|
|
|
||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
Change
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Net interest expense
|
|
$
|
9.2
|
|
|
$
|
9.0
|
|
|
$
|
0.2
|
|
|
Other expense (income), net
|
|
(1.0
|
)
|
|
7.8
|
|
|
(8.8
|
)
|
|||
|
Net interest and other expense
|
|
$
|
8.2
|
|
|
$
|
16.8
|
|
|
$
|
(8.6
|
)
|
|
|
|
Three Months Ended June 30,
|
|
|
||||||||
|
(in millions, except per share data)
|
|
2018
|
|
2017
|
|
$ Change
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Provision (benefit) for income taxes
|
|
$
|
(41.3
|
)
|
|
$
|
(14.5
|
)
|
|
$
|
(26.8
|
)
|
|
|
|
|
|
|
|
|
||||||
|
Effective income tax rate
|
|
NM
|
|
|
NM
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||||
|
Net loss attributable to Dentsply Sirona
|
|
$
|
(1,122.0
|
)
|
|
$
|
(1,050.0
|
)
|
|
$
|
(72.0
|
)
|
|
|
|
|
|
|
|
|
||||||
|
Net loss per common share - diluted
|
|
$
|
(4.98
|
)
|
|
$
|
(4.58
|
)
|
|
|
|
|
|
|
|
Three Months Ended
|
||||||
|
|
|
June 30, 2018
|
||||||
|
(in millions, except per share amounts)
|
|
Net (Loss) Income
|
|
Per Diluted
Common Share
|
||||
|
|
|
|
|
|
||||
|
Net loss attributable to Dentsply Sirona
|
|
$
|
(1,122.0
|
)
|
|
$
|
(4.98
|
)
|
|
Pre-tax non-US GAAP adjustments:
|
|
|
|
|
|
|||
|
Restructuring program related costs and other costs
|
|
1,278.5
|
|
|
|
|||
|
Amortization of purchased intangible assets
|
|
50.1
|
|
|
|
|||
|
Business combination related costs and fair value adjustments
|
|
6.6
|
|
|
|
|||
|
Credit risk and fair value adjustments
|
|
2.5
|
|
|
|
|||
|
Tax impact of the pre-tax non-US GAAP adjustments
(a)
|
|
(72.6
|
)
|
|
|
|||
|
Subtotal non-US GAAP adjustments
|
|
1,265.1
|
|
|
5.57
|
|
||
|
Adjustment for calculating non-US GAAP net income per diluted common share
(b)
|
|
|
|
0.04
|
|
|||
|
Income tax related adjustments
|
|
(6.3
|
)
|
|
(0.03
|
)
|
||
|
Adjusted non-US GAAP net income
|
|
$
|
136.8
|
|
|
$
|
0.60
|
|
|
|
|
|
|
|
||||
|
(a) The tax amount was calculated using the applicable statutory tax rate in the tax jurisdiction where the non-US GAAP adjustments were generated.
|
||||||||
|
(b) The Company had a net loss for the three months ended June 30, 2018, but had net income on a non-US GAAP basis. The shares used in calculating diluted non-US GAAP net income per share includes the dilutive effect of common stock.
|
||||||||
|
Shares used in calculating diluted GAAP net loss per share
|
|
|
|
225.2
|
||||
|
Shares used in calculating diluted non-US GAAP net income per share
|
|
|
|
226.9
|
||||
|
|
|
Three Months Ended
|
||||||
|
|
|
June 30, 2017
|
||||||
|
(in millions, except per share amounts)
|
|
Net (Loss) Income
|
|
Per Diluted
Common Share
|
||||
|
|
|
|
|
|
||||
|
Net loss attributable to Dentsply Sirona
|
|
$
|
(1,050.0
|
)
|
|
$
|
(4.58
|
)
|
|
Pre-tax non-US GAAP adjustments:
|
|
|
|
|
||||
|
Restructuring program related costs and other costs
|
|
1,177.6
|
|
|
|
|||
|
Amortization of purchased intangible assets
|
|
46.5
|
|
|
|
|||
|
Business combination related costs and fair value adjustments
|
|
19.3
|
|
|
|
|||
|
Credit risk and fair value adjustments
|
|
0.8
|
|
|
|
|||
|
Tax impact of the pre-tax non-US GAAP adjustments
(a)
|
|
(44.4
|
)
|
|
|
|||
|
Subtotal non-US GAAP adjustments
|
|
1,199.8
|
|
|
5.14
|
|
||
|
Adjustment for calculating non-US GAAP net income per diluted common share
(b)
|
|
|
|
0.08
|
|
|||
|
Income tax related adjustments
|
|
0.9
|
|
|
0.01
|
|
||
|
Adjusted non-US GAAP net income
|
|
$
|
150.7
|
|
|
$
|
0.65
|
|
|
|
|
|
|
|
||||
|
(a) The tax amount was calculated using the applicable statutory tax rate in the tax jurisdiction where the non-US GAAP adjustments were generated.
|
||||||||
|
(b) The Company had a net loss for the three months ended June 30, 2017, but had net income on a non-US GAAP basis. The shares used in calculating diluted non-US GAAP net income per share includes the dilutive effect of common stock.
|
||||||||
|
Shares used in calculating diluted GAAP net loss per share
|
|
|
|
229.4
|
||||
|
Shares used in calculating diluted non-US GAAP net income per share
|
|
|
|
233.3
|
||||
|
|
|
Three Months Ended
|
|||||
|
|
|
June 30, 2018
|
|||||
|
(in millions)
|
|
Operating (Loss) Income
|
|
Percentage of Net Sales, Excluding Precious Metal Content
|
|||
|
|
|
|
|
|
|||
|
Operating Loss
|
|
$
|
(1,154.1
|
)
|
|
(111.8
|
)%
|
|
Restructuring program related costs and other costs
|
|
1,278.5
|
|
|
123.8
|
%
|
|
|
Amortization of purchased intangible assets
|
|
50.1
|
|
|
4.9
|
%
|
|
|
Business combination related costs and fair value adjustments
|
|
5.8
|
|
|
0.5
|
%
|
|
|
Adjusted non-US GAAP Operating Income
|
|
$
|
180.3
|
|
|
17.4
|
%
|
|
|
|
Three Months Ended
|
|||||
|
|
|
June 30, 2017
|
|||||
|
(in millions)
|
|
Operating (Loss) Income
|
|
Percentage of Net Sales, Excluding Precious Metal Content
|
|||
|
|
|
|
|
|
|||
|
Operating Loss
|
|
$
|
(1,048.0
|
)
|
|
(106.6
|
)%
|
|
Restructuring program related costs and other costs
|
|
1,176.7
|
|
|
119.7
|
%
|
|
|
Amortization of purchased intangible assets
|
|
46.5
|
|
|
4.7
|
%
|
|
|
Business combination related costs and fair value adjustments
|
|
19.1
|
|
|
1.9
|
%
|
|
|
Credit risk and fair value adjustments
|
|
0.8
|
|
|
0.1
|
%
|
|
|
Adjusted non-US GAAP Operating Income
|
|
$
|
195.1
|
|
|
19.8
|
%
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Technologies & Equipment
|
|
$
|
539.4
|
|
|
$
|
523.1
|
|
|
$
|
16.3
|
|
|
3.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Consumables
|
|
493.3
|
|
|
459.9
|
|
|
33.4
|
|
|
7.3
|
%
|
|||
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Technologies & Equipment
|
|
$
|
77.1
|
|
|
$
|
98.0
|
|
|
$
|
(20.9
|
)
|
|
(21.3
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Consumables
|
|
146.0
|
|
|
122.8
|
|
|
23.2
|
|
|
18.9
|
%
|
|||
|
|
|
Three Months Ended
|
||||||||||
|
|
|
June 30, 2018
|
||||||||||
|
(in millions)
|
|
Technologies & Equipment
|
|
Consumables
|
|
Total
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Net sales
|
|
$
|
548.8
|
|
|
$
|
493.3
|
|
|
$
|
1,042.1
|
|
|
Less: precious metal content of sales
|
|
9.4
|
|
|
—
|
|
|
9.4
|
|
|||
|
Net sales, excluding precious metal content
|
|
539.4
|
|
|
493.3
|
|
|
1,032.7
|
|
|||
|
Acquisition related adjustments
(a)
|
|
—
|
|
|
2.1
|
|
|
2.1
|
|
|||
|
Non-US GAAP net sales, excluding precious metal content
|
|
$
|
539.4
|
|
|
$
|
495.4
|
|
|
$
|
1,034.8
|
|
|
|
|
Three Months Ended
|
||||||||||
|
|
|
June 30, 2017
|
||||||||||
|
(in millions)
|
|
Technologies & Equipment
|
|
Consumables
|
|
Total
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Net sales
|
|
$
|
532.8
|
|
|
$
|
459.9
|
|
|
$
|
992.7
|
|
|
Less: precious metal content of sales
|
|
9.7
|
|
|
—
|
|
|
9.7
|
|
|||
|
Net sales, excluding precious metal content
|
|
523.1
|
|
|
459.9
|
|
|
983.0
|
|
|||
|
Merger related adjustments
(a)
|
|
1.5
|
|
|
—
|
|
|
1.5
|
|
|||
|
Non-US GAAP net sales, excluding precious metal content
|
|
$
|
524.6
|
|
|
$
|
459.9
|
|
|
$
|
984.5
|
|
|
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net sales
|
|
$
|
1,998.2
|
|
|
$
|
1,893.2
|
|
|
$
|
105.0
|
|
|
5.5
|
%
|
|
Less: precious metal content of sales
|
|
19.7
|
|
|
20.8
|
|
|
(1.1
|
)
|
|
(5.3
|
%)
|
|||
|
Net sales, excluding precious metal content
|
|
$
|
1,978.5
|
|
|
$
|
1,872.4
|
|
|
$
|
106.1
|
|
|
5.7
|
%
|
|
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|
|
|||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
United States
|
|
$
|
627.6
|
|
|
$
|
642.3
|
|
|
$
|
(14.7
|
)
|
|
(2.3
|
%)
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Europe
|
|
836.8
|
|
|
759.1
|
|
|
77.7
|
|
|
10.2
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Rest of World
|
|
514.1
|
|
|
471.0
|
|
|
43.1
|
|
|
9.2
|
%
|
|||
|
|
|
Six Months Ended
|
||||||||||||||
|
|
|
June 30, 2018
|
||||||||||||||
|
(in millions)
|
|
United States
|
|
Europe
|
|
Rest of World
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net sales
|
|
$
|
630.2
|
|
|
$
|
852.2
|
|
|
$
|
515.8
|
|
|
$
|
1,998.2
|
|
|
Less: precious metal content of sales
|
|
2.6
|
|
|
15.4
|
|
|
1.7
|
|
|
19.7
|
|
||||
|
Net sales, excluding precious metal content
|
|
627.6
|
|
|
836.8
|
|
|
514.1
|
|
|
1,978.5
|
|
||||
|
Acquisition related adjustments
(a)
|
|
2.1
|
|
|
—
|
|
|
—
|
|
|
2.1
|
|
||||
|
Non-US GAAP net sales, excluding precious metal content
|
|
$
|
629.7
|
|
|
$
|
836.8
|
|
|
$
|
514.1
|
|
|
$
|
1,980.6
|
|
|
|
|
Six Months Ended
|
||||||||||||||
|
|
|
June 30, 2017
|
||||||||||||||
|
(in millions)
|
|
United States
|
|
Europe
|
|
Rest of World
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net sales
|
|
$
|
645.2
|
|
|
$
|
774.9
|
|
|
$
|
473.1
|
|
|
$
|
1,893.2
|
|
|
Less: precious metal content of sales
|
|
2.9
|
|
|
15.8
|
|
|
2.1
|
|
|
20.8
|
|
||||
|
Net sales, excluding precious metal content
|
|
642.3
|
|
|
759.1
|
|
|
471.0
|
|
|
1,872.4
|
|
||||
|
Merger related adjustments
(a)
|
|
3.0
|
|
|
—
|
|
|
—
|
|
|
3.0
|
|
||||
|
Non-US GAAP net sales, excluding precious metal content
|
|
$
|
645.3
|
|
|
$
|
759.1
|
|
|
$
|
471.0
|
|
|
$
|
1,875.4
|
|
|
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|
|
|||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Gross profit
|
|
$
|
1,066.9
|
|
|
$
|
1,036.2
|
|
|
$
|
30.7
|
|
|
3.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Gross profit as a percentage of net sales, including precious metal content
|
|
53.4
|
%
|
|
54.7
|
%
|
|
|
|
|
|
|
|||
|
Gross profit as a percentage of net sales, excluding precious metal content
|
|
53.9
|
%
|
|
55.3
|
%
|
|
|
|
|
|
|
|||
|
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|
|
|||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Selling, general and administrative expenses (“SG&A”)
|
|
$
|
867.4
|
|
|
$
|
822.3
|
|
|
$
|
45.1
|
|
|
5.5
|
%
|
|
Goodwill impairment
|
|
1,085.8
|
|
|
1,092.9
|
|
|
(7.1
|
)
|
|
(0.6
|
%)
|
|||
|
Restructuring and other costs
|
|
199.1
|
|
|
84.8
|
|
|
114.3
|
|
|
NM
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
|
SG&A as a percentage of net sales, including precious metal content
|
|
43.4
|
%
|
|
43.4
|
%
|
|
|
|
|
|
|
|||
|
SG&A as a percentage of net sales, excluding precious metal content
|
|
43.8
|
%
|
|
43.9
|
%
|
|
|
|
|
|
|
|||
|
|
|
Six Months Ended
|
|
|
||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
Change
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Net interest expense
|
|
$
|
17.2
|
|
|
$
|
17.6
|
|
|
$
|
(0.4
|
)
|
|
Other expense (income), net
|
|
(35.1
|
)
|
|
6.8
|
|
|
(41.9
|
)
|
|||
|
Net interest and other expense
|
|
$
|
(17.9
|
)
|
|
$
|
24.4
|
|
|
$
|
(42.3
|
)
|
|
|
|
Six Months Ended
|
|
|
||||||||
|
(in millions, except per share data)
|
|
2018
|
|
2017
|
|
$ Change
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Provision (benefit) for income taxes
|
|
$
|
(27.6
|
)
|
|
$
|
2.4
|
|
|
$
|
(30.0
|
)
|
|
|
|
|
|
|
|
|
||||||
|
Effective income tax rate
|
|
NM
|
|
|
NM
|
|
|
|
||||
|
|
|
|
|
|
|
|
||||||
|
Net loss attributable to Dentsply Sirona
|
|
$
|
(1,040.8
|
)
|
|
$
|
(990.2
|
)
|
|
$
|
(50.6
|
)
|
|
|
|
|
|
|
|
|
||||||
|
Net loss per common share - diluted
|
|
$
|
(4.60
|
)
|
|
$
|
(4.31
|
)
|
|
|
|
|
|
|
|
Six Months Ended
|
||||||
|
|
|
June 30, 2018
|
||||||
|
(in millions, except per share amounts)
|
|
Net (Loss) Income
|
|
Per Diluted
Common Share
|
||||
|
|
|
|
|
|
||||
|
Net loss attributable to Dentsply Sirona
|
|
$
|
(1,040.8
|
)
|
|
$
|
(4.60
|
)
|
|
Pre-tax non-US GAAP adjustments:
|
|
|
|
|
||||
|
Restructuring program related costs and other costs
|
|
1,294.3
|
|
|
|
|||
|
Amortization of purchased intangible assets
|
|
100.1
|
|
|
|
|||
|
Credit risk and fair value adjustments
|
|
13.3
|
|
|
|
|||
|
Business combination related costs and fair value adjustments
|
|
9.9
|
|
|
|
|||
|
Gain on sale of marketable securities
|
|
(44.1
|
)
|
|
|
|||
|
Tax impact of the pre-tax non-US GAAP adjustments
(a)
|
|
(95.4
|
)
|
|
|
|||
|
Subtotal non-US GAAP adjustments
|
|
1,278.1
|
|
|
5.60
|
|
||
|
Adjustment for calculating non-US GAAP net income per diluted common share
(b)
|
|
|
|
0.04
|
|
|||
|
Income tax related adjustments
|
|
2.3
|
|
|
0.01
|
|
||
|
Adjusted non-US GAAP net income
|
|
$
|
239.6
|
|
|
$
|
1.05
|
|
|
|
|
|
|
|
||||
|
(a) The tax amount was calculated using the applicable statutory tax rate in the tax jurisdiction where the non-US GAAP adjustments were generated.
|
||||||||
|
(b) The Company had a net loss for the six months ended June 30, 2018, but had net income on a non-US GAAP basis. The shares used in calculating diluted non-US GAAP net income per share includes the dilutive effect of common stock.
|
||||||||
|
Shares used in calculating diluted US GAAP net loss per share
|
|
|
|
226.2
|
||||
|
Shares used in calculating diluted non-US GAAP net income per share
|
|
|
|
228.3
|
||||
|
|
|
Six Months Ended
|
||||||
|
|
|
June 30, 2017
|
||||||
|
(in millions, except per share amounts)
|
|
Net (Loss) Income
|
|
Per Diluted
Common Share
|
||||
|
|
|
|
|
|
||||
|
Net loss attributable to Dentsply Sirona
|
|
$
|
(990.2
|
)
|
|
$
|
(4.31
|
)
|
|
Pre-tax non-US GAAP adjustments:
|
|
|
|
|
||||
|
Restructuring program related costs and other costs
|
|
1,182.8
|
|
|
|
|||
|
Amortization of purchased intangible assets
|
|
91.8
|
|
|
|
|||
|
Business combination related costs and fair value adjustments
|
|
30.1
|
|
|
|
|||
|
Credit risk and fair value adjustments
|
|
3.4
|
|
|
|
|||
|
Tax impact of the pre-tax non-US GAAP adjustments
(a)
|
|
(57.2
|
)
|
|
|
|||
|
Subtotal non-US GAAP adjustments
|
|
1,250.9
|
|
|
5.36
|
|
||
|
Adjustment for calculating non-US GAAP net income per diluted common share (b)
|
|
|
|
0.07
|
|
|||
|
Income tax related adjustments
|
|
3.6
|
|
|
0.01
|
|
||
|
Adjusted non-US GAAP net income
|
|
$
|
264.3
|
|
|
$
|
1.13
|
|
|
|
|
|
|
|
||||
|
(a) The tax amount was calculated using the applicable statutory tax rate in the tax jurisdiction where the non-US GAAP adjustments were generated.
|
||||||||
|
(b) The Company had a net loss for the six months ended June 30, 2017, but had net income on a non-US GAAP basis. The shares used in calculating diluted non-US GAAP net income per share includes the dilutive effect of common stock.
|
||||||||
|
Shares used in calculating diluted US GAAP net loss per share
|
|
|
|
229.4
|
||||
|
Shares used in calculating diluted non-US GAAP net income per share
|
|
|
|
233.3
|
||||
|
|
|
Six Months Ended
|
|||||
|
|
|
June 30, 2018
|
|||||
|
(in millions)
|
|
Operating (Loss) Income
|
|
Percentage of Net Sales, Excluding Precious Metal Content
|
|||
|
|
|
|
|
|
|||
|
Operating Loss
|
|
$
|
(1,085.4
|
)
|
|
(54.9
|
)%
|
|
Restructuring program related costs and other costs
|
|
1,294.3
|
|
|
65.5
|
%
|
|
|
Amortization of purchased intangible assets
|
|
100.1
|
|
|
5.0
|
%
|
|
|
Business combination related costs and fair value adjustments
|
|
8.8
|
|
|
0.4
|
%
|
|
|
Adjusted non-US GAAP Operating Income
|
|
$
|
317.8
|
|
|
16.0
|
%
|
|
|
|
Six Months Ended
|
|||||
|
|
|
June 30, 2017
|
|||||
|
(in millions)
|
|
Operating (Loss) Income
|
|
Percentage of Net Sales, Excluding Precious Metal Content
|
|||
|
|
|
|
|
|
|||
|
Operating Loss
|
|
$
|
(963.8
|
)
|
|
(51.5
|
)%
|
|
Restructuring program related costs and other costs
|
|
1,181.7
|
|
|
63.1
|
%
|
|
|
Amortization of purchased intangible assets
|
|
91.8
|
|
|
4.9
|
%
|
|
|
Business combination related costs and fair value adjustments
|
|
29.7
|
|
|
1.6
|
%
|
|
|
Credit risk and fair value adjustments
|
|
3.4
|
|
|
0.2
|
%
|
|
|
Adjusted non-US GAAP Operating Income
|
|
$
|
342.8
|
|
|
18.3
|
%
|
|
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Technologies & Equipment
|
|
$
|
1,037.4
|
|
|
$
|
991.0
|
|
|
$
|
46.4
|
|
|
4.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Consumables
|
|
941.1
|
|
|
881.4
|
|
|
59.7
|
|
|
6.8
|
%
|
|||
|
|
|
Six Months Ended
|
|
|
|
|
|||||||||
|
|
|
June 30,
|
|
|
|||||||||||
|
(in millions)
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Technologies & Equipment
|
|
$
|
151.8
|
|
|
$
|
151.9
|
|
|
$
|
(0.1
|
)
|
|
(0.1
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Consumables
|
|
253.2
|
|
|
238.9
|
|
|
14.3
|
|
|
6.0
|
%
|
|||
|
|
|
Six Months Ended
|
||||||||||
|
|
|
June 30, 2018
|
||||||||||
|
(in millions)
|
|
Technologies & Equipment
|
|
Consumables
|
|
Total
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Net sales
|
|
$
|
1,057.1
|
|
|
$
|
941.1
|
|
|
$
|
1,998.2
|
|
|
Less: precious metal content of sales
|
|
19.7
|
|
|
—
|
|
|
19.7
|
|
|||
|
Net sales, excluding precious metal content
|
|
1,037.4
|
|
|
941.1
|
|
|
1,978.5
|
|
|||
|
Acquisition related adjustments
(a)
|
|
—
|
|
|
2.1
|
|
|
2.1
|
|
|||
|
Non-US GAAP net sales, excluding precious metal content
|
|
$
|
1,037.4
|
|
|
$
|
943.2
|
|
|
$
|
1,980.6
|
|
|
|
|
Six Months Ended
|
||||||||||
|
|
|
June 30, 2017
|
||||||||||
|
(in millions)
|
|
Technologies & Equipment
|
|
Consumables
|
|
Total
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Net sales
|
|
$
|
1,011.8
|
|
|
$
|
881.4
|
|
|
$
|
1,893.2
|
|
|
Less: precious metal content of sales
|
|
20.8
|
|
|
—
|
|
|
20.8
|
|
|||
|
Net sales, excluding precious metal content
|
|
991.0
|
|
|
881.4
|
|
|
1,872.4
|
|
|||
|
Merger related adjustments
(a)
|
|
3.0
|
|
|
—
|
|
|
3.0
|
|
|||
|
Non-US GAAP net sales, excluding precious metal content
|
|
$
|
994.0
|
|
|
$
|
881.4
|
|
|
$
|
1,875.4
|
|
|
•
|
In connection with the Company’s April 30, 2017 annual goodwill impairment test and the preparation of the financial statements for the quarter ended June 30, 2017, the Company recorded a $1,092.9 million non-cash goodwill impairment charge associated with the CAD/CAM, Imaging and Treatment Center equipment reporting units. In addition, the Company tested the indefinite-lived intangible assets related to the CAD/CAM and Imaging reporting units and determined that certain tradenames and trademarks were impaired, resulting in the recording of an impairment charge of $79.8 million for the three months ended June 30, 2017.
|
|
•
|
In preparing the financial statements for the year ended December 31, 2017, the Company identified a triggering event and recorded a $558.0 million non-cash goodwill impairment charge associated with the CAD/CAM, Imaging and Treatment Center equipment reporting units. In addition, the Company tested the indefinite-lived intangible assets related to these reporting units and determined that certain tradenames and trademarks were impaired, resulting in the recording of an impairment charge of $266.9 million for the three months ended December 31, 2017.
|
|
•
|
In connection with the Company’s April 30, 2018 annual goodwill impairment test and the preparation of the financial statements for the quarter ended June 30, 2018, the Company recorded a $1,085.8 million non-cash goodwill impairment charge associated with the CAD/CAM and Imaging equipment reporting units and the Orthodontics reporting unit. In addition, the Company tested the indefinite-lived intangible assets related to the equipment reporting units and determined that certain tradenames and trademarks were impaired, resulting in the recording of an impairment charge of $179.2 million for the three months ended June 30, 2018.
|
|
(in millions, except per share amounts)
Period |
|
Total Number
of Shares Purchased |
|
Average Price
Paid Per Share |
|
Total Cost
of Shares Purchased |
|
Dollar Value of Shares that
May be Purchased Under the Stock Repurchase Program |
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
April 1, 2018 to April 30, 2018
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,000.0
|
|
|
May 1, 2018 to May 31, 2018
|
|
4.3
|
|
|
46.77
|
|
|
200.2
|
|
|
799.8
|
|
|||
|
June 1, 2018 to June 30, 2018
|
|
1.1
|
|
|
42.79
|
|
|
50.0
|
|
|
749.8
|
|
|||
|
|
|
5.4
|
|
|
$
|
45.92
|
|
|
$
|
250.2
|
|
|
|
||
|
Exhibit Number
|
|
Description
|
|
|
Credit Agreement, dated as of July 27, 2018, among DENTSPLY SIRONA Inc., JPMorgan Chase Bank, N.A., as Administrative Agent, Citibank, N.A., as Syndication Agent, Commerzbank AG, New York Branch, MUFG Bank, Ltd., Wells Fargo Bank, National Association, Unicredit Bank AG, New York Branch and TD Bank, N.A., as Co-Documentation Agents, and the several lenders party thereto
(1)
|
|
|
|
Employee Stock Purchase Plan Agreement, dated May 23, 2018 (Filed herewith)
|
|
|
|
Non-Employee Director Compensation Policy, dated June 26, 2018 (Filed herewith)
|
|
|
|
Section 302 Certification Statement Chief Executive Officer
|
|
|
|
Section 302 Certification Statement Chief Financial Officer
|
|
|
|
Section 906 Certification Statements
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
101.LAB
|
|
XBRL Extension Labels Linkbase Document
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
(1) Incorporated by reference to Exhibit 10.1 in the Company’s Form 8-K dated July 30, 2018, File No. 0-16211.
|
||
|
/s/
|
Donald M. Casey, Jr.
|
|
August 7, 2018
|
|
|
Donald M. Casey, Jr.
|
|
Date
|
|
|
Chief Executive Officer
|
|
|
|
/s/
|
Nicholas W. Alexos
|
|
August 7, 2018
|
|
|
Nicholas W. Alexos
|
|
Date
|
|
|
Executive Vice President and
|
|
|
|
|
Chief Financial Officer
|
|
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|
No information found
No Customers Found
No Suppliers Found
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|