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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Wabco Holdings Inc | NYSE:WBC | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 136.46 | 0 | 01:00:00 |
Delaware
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20-8481962
|
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(State or other jurisdiction of
incorporation or organization)
|
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(I.R.S. Employer
Identification No.)
|
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1 Giacomettistrasse
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Bern
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Switzerland
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3000-31
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1220 Pacific Drive
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Auburn Hills
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Michigan
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48326-3511
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common stock, par value $0.01 per share
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WBC
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New York Stock Exchange
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Title of each class
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None
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Large Accelerated Filer
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☒
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Accelerated Filer
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☐
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Non-Accelerated Filer
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☐
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(Do not check if a smaller reporting company)
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Smaller Reporting Company
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☐
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Emerging Growth Company
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☐
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Common stock, $.01 par value, outstanding at
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February 12, 2020
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51,270,513
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|
shares
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TABLE OF CONTENTS
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Page
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 4A.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
|
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Item 14.
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Item 15.
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Item 16.
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Form 10-K Summary
|
|
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•
|
the actual level of commercial vehicle production in our end-markets;
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•
|
adverse developments in the business of our key customers;
|
•
|
periodic changes to contingent liabilities;
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•
|
adverse developments in general business, economic and political conditions or any outbreak or escalation of hostilities on a national, regional or international basis;
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•
|
changes in international or U.S. economic conditions, such as inflation, interest rate fluctuations, foreign exchange rate fluctuations or recessions in our markets;
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•
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difficulties in international trade caused by geopolitical developments including tariffs, sanctions and the United Kingdom’s exit from the European Union;
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•
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cybersecurity threats, including the potential misappropriation of assets or sensitive information, corruption of data or operational disruption;
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•
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unpredictable difficulties or delays in the development of new product technology;
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•
|
pricing changes to our products or those of our competitors, and other competitive pressures on pricing and sales;
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•
|
our ability to receive components and parts from our suppliers of a reasonable quality level or to obtain them at reasonable price levels due to fluctuations in the costs of the underlying raw materials;
|
•
|
our ability to access credit markets or capital markets on a favorable basis or at all;
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•
|
our ability to service our debt obligations;
|
•
|
changes in the environmental regulations that affect our current and future products;
|
•
|
competition in our existing and future lines of business and the financial resources of competitors;
|
•
|
our failure to comply with regulations and any changes in regulations;
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•
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our failure to complete potential future acquisitions, collaborations and cooperations or to realize benefits from completed acquisitions, collaborations and cooperations;
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•
|
our inability to implement our growth plan;
|
•
|
our ability to service our pension obligations;
|
•
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the loss of any of our senior management;
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•
|
difficulties in obtaining or retaining the management and other human resource competencies that we need to achieve our business objectives;
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•
|
the success of, and costs and savings associated with, our current streamlining initiatives;
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•
|
labor relations;
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•
|
our ability to complete and realize the tax benefits associated with certain projects relating to the reorganization of our treasury function;
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•
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our ability to mitigate any tax risks, including, but not limited to, those risks associated with changes in legislation, tax audits and the loss of the benefits associated with our tax rulings and incentives in certain jurisdictions;
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•
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risks inherent in operating in foreign countries, including exposure to local economic conditions, government regulation, currency restrictions and other restraints, changes in tax laws and rulings, expropriation, political instability and diminished ability to legally enforce our contractual rights;
|
•
|
conditions to the closing of the Merger, including obtaining required regulatory approvals, may not be satisfied or waived on a timely basis or otherwise;
|
•
|
a governmental entity or a regulatory body may prohibit, delay or refuse to grant approval for the consummation of the Merger and may require conditions, limitations or restrictions in connection with such approvals that can adversely affect the anticipated benefits of the proposed Merger or cause the parties to abandon the proposed Merger;
|
•
|
the Merger may involve unexpected costs, liabilities or delays;
|
•
|
our business may suffer as a result of uncertainty surrounding the Merger or the potential adverse changes to business relationships resulting from the proposed Merger;
|
•
|
legal proceedings that may be initiated related to the Merger and the outcome of any legal proceedings related to the Merger, which may be adverse to us;
|
•
|
our inability to complete the acquisition of the North American aftermarket distribution rights from Meritor within the timeframe called for under the contract and on the terms required under the contract;
|
•
|
we may be adversely affected by other general industry, economic, business and/or competitive factors;
|
•
|
there may be unforeseen events, changes or other circumstances that could give rise to the termination of the Merger Agreement or affect the ability to recognize benefits of the Merger;
|
•
|
risks that the proposed Merger may disrupt current plans and operations and present potential difficulties in employee retention as a result of the Merger;
|
•
|
risks related to diverting management’s attention from WABCO's ongoing business operations; and
|
•
|
there may be other risks to consummation of the Merger, including the risk that the Merger will not be consummated within the expected time period or at all which may affect our business and the price of our common stock.
|
WABCO KEY PRODUCT GROUPS
|
||
SYSTEM / PRODUCT
|
|
FUNCTION
|
Actuator
|
|
Converts energy stored in compressed air into mechanical force applied to foundation brake to slow or stop commercial vehicles
|
Air Compressor and Air Processing/Air Management System
|
|
Provides compressed, dried air for braking, suspension and other pneumatic systems on trucks, buses and trailers
|
Foundation Brake
|
|
Transmits braking force to slow, stop or hold vehicles
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Anti-lock Braking System (ABS)
|
|
Prevents wheel locking during braking to ensure steerability and stability
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Conventional Braking System
|
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Mechanical and pneumatic devices for control of braking systems in commercial vehicles
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Electronic Braking System (EBS)
|
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Electronic controls of braking systems for commercial vehicles
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Electronic and Conventional Air Suspension Systems
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|
Level and pressure control of air springs in trucks, buses, trailers and cars
|
Transmission Automation
|
|
Automates transmission gear shifting for trucks and buses including clutch operation
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Vehicle Electronic Stability Control (ESC) and Roll Stability Support (RSS)
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|
Enhances driving stability
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Advanced Driver Assistance Systems (ADAS)
|
|
Promotes driver safety through lane departure warnings, collision mitigation and emergency braking systems
|
Fleet Management Solutions (FMS)
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|
Improves vehicle safety and efficiency for fleet managers through real-time online commercial vehicle telematics and communications
|
Steering Technologies
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|
Controls the lateral movement of the vehicle
|
Year to Year Change
|
|
2015
|
|
2016
|
|
2017
|
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2018
|
|
2019
|
|||||
Sales to European T&B OEMs (at a constant FX rate)
|
|
8
|
%
|
|
8
|
%
|
|
6
|
%
|
|
3
|
%
|
|
(9
|
)%
|
European T&B Production
|
|
6
|
%
|
|
1
|
%
|
|
8
|
%
|
|
2
|
%
|
|
(8
|
)%
|
•
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Truck and bus OEMs;
|
•
|
Commercial vehicle aftermarket distributors for replacement parts and services and commercial vehicle fleet operators for management solutions and services;
|
•
|
Trailer OEMs;
|
•
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Major car manufacturers, and
|
•
|
Manufacturers of heavy duty, off-highway vehicles in agriculture, construction, mining and similar industries.
|
WABCO SALES
|
||||||||||
By Geography
|
FY 2019 % of Sales
|
FY 2018 % of Sales
|
|
By Major End-Market
|
FY 2019 % of Sales
|
FY 2018 % of Sales
|
||||
Europe
|
48
|
%
|
49
|
%
|
|
Truck & Bus Products (OEMs)
|
54
|
%
|
55
|
%
|
Asia
|
22
|
%
|
24
|
%
|
|
Aftermarket
|
26
|
%
|
25
|
%
|
North America
|
24
|
%
|
23
|
%
|
|
Trailer Products
|
10
|
%
|
10
|
%
|
South America
|
4
|
%
|
3
|
%
|
|
Car Products
|
5
|
%
|
5
|
%
|
Other
|
2
|
%
|
1
|
%
|
|
Off Highway Products
|
5
|
%
|
5
|
%
|
•
|
First heavy-duty truck anti-lock braking system (ABS)
|
•
|
First electronically controlled air suspension (ECAS) system for commercial vehicles
|
•
|
First commercial vehicle automated manual transmission (AMT) controls system
|
•
|
First electronic braking system (EBS) for commercial vehicles
|
•
|
First electronic stability control (ESC) system for heavy-duty commercial vehicles
|
•
|
First collision mitigation system (CMS) with active braking for commercial vehicles
|
•
|
First autonomous emergency braking system (AEBS) for commercial vehicles
|
•
|
First collision safety system with active braking developed for the North American market based on Adaptive Cruise Control (ACC) technology
|
•
|
First hydraulic ABS integrated with ESC for medium-duty commercial vehicles
|
•
|
First modular braking system platform (mBSP™) that enables vehicle makers to interchangeably equip their truck and bus platforms with either ABS or electronic braking systems (EBS) anywhere in the world
|
•
|
First technology (TX-TRAILERGUARD™) that provides comprehensive operating data on the performance of the truck, trailer and driver in a single integrated real-time view
|
•
|
First technology (OptiLink™) that provides a single user interface via a mobile device, such as a smartphone, to monitor and control multiple functions on both the truck and trailer
|
•
|
First door lock control technology (OptiLock™) that provides high security locking systems for trailers and container doors seamlessly connected with telematics systems
|
•
|
First Evasive Maneuver Assist (EMA) capabilities that combines WABCO's world-class braking, stability and vehicle dynamics control systems on trucks and trailers with ZF's top active steering technology
|
•
|
OnSide™, an advanced blind-spot detection system for commercial trucks and trailers. A radar-based system alerts drivers to the presence of a moving vehicle in a truck’s blind spot and provides a side-collision warning to reduce the risk of accidents.
|
•
|
A majority-owned joint venture (90%) in Japan with Sanwa-Seiki (WABCO Japan, Inc.) that distributes WABCO's products in the local market
|
•
|
A majority-owned (70%) manufacturing partnership in the United States with Cummins Engine Co. (WABCO Compressor Manufacturing Co.) formed to produce air compressors designed by WABCO
|
•
|
A majority-owned joint venture (60%) with FAW Jiefang (FAW Jiefang Automotive Co., Ltd) to advance the safety and efficiency of commercial vehicles in China.
|
•
|
A 50% owned joint venture in Germany with RuC Holding GmbH (WABCOWURTH Workshop Services GmbH) that supplies commercial vehicle workshops, fleet owners and operators and end users internationally with multi-brand technology diagnostic systems
|
•
|
A 50% owned joint venture in China with Beijing Huitong Tianxia IOT Technology Co., Ltd (Shanghai G7 WABCO IOT Technology Co Ltd), to develop innovative Trailer FMS solutions for the Chinese fleet market
|
•
|
A 50% owned joint venture in China with Northstars Automobile Steering System Ltd (Sino-American RH Sheppard Hubei Steering Systems LTD), that is specialized insteering gears distribution on the Chinese market
|
•
|
A 37.5% owned joint venture with Shanghai Qingchuang Metal Products Trading Co., Ltd (China Source Engineered Components Trading Corporation Ltd) that wholesales machined parts, fasteners, hydraulic components and other automotive parts.
|
Campinas, Brazil (M, L)
|
Jeversen, Germany (TT)
|
Stanowice, Poland (M)
|
Jinan, China (M)
|
Ambattur, India (M)
|
Wroclaw, Poland (2 plants, M)
|
Qingdao, China (M)
|
Jamshedpur, India (M)
|
Charleston, United States (M)
|
Taishan, China (M)
|
Mahindra World City, India (M)
|
Rochester Hills, United States (M)
|
Hannover, Germany (M)
|
Lucknow, India (M)
|
North Mankato, United States (M)
|
Langehagen, Germany (L)
|
Chennai, India (TT)
|
Hanover, United States (M)
|
Gronau, Germany (M)
|
Pantnagar, India (M)
|
Wytheville, United States (M)
|
Mannheim, Germany (M)
|
Pyungtaek, Korea (M)
|
Hebron, United States (M)
|
•
|
increases in non-U.S. tax rates and the amount of non-U.S. earnings relative to total combined earnings could change and impact our combined tax rate;
|
•
|
foreign earnings may be subject to withholding requirements or the imposition of tariffs, price or exchange controls, or other restrictions;
|
•
|
general economic and political conditions in countries where we operate may have an adverse effect on our operations in those countries;
|
•
|
our internal controls may not always protect us from reckless or criminal acts committed by our employees, agents or business partners that would violate the U.S. Foreign Corrupt Practices Act or other applicable anti-corruption legislation, as well as export controls and trade sanctions, which could result in fines or criminal penalties;
|
•
|
governmental actions (such as restrictions on transfer of funds and trade protection measures, including export duties, quotas and customs duties and tariffs);
|
•
|
we may have difficulty complying with a variety of foreign laws and regulations, some of which may conflict with United States law, and the uncertainty created by this legal environment could limit our ability to effectively enforce our rights in certain markets;
|
•
|
in several of the countries in which we do business, we rely upon the ongoing performance of our joint venture partners who bear risks similar to our risks and also may include obligations they have under related shareholders' agreements and risk of being denied access to the capital markets which could lead to resource demands on the Company in order to maintain or advance its strategy; and
|
•
|
business interruptions resulting from the COVID-19 coronavirus or other health epidemics, which may impact our foreign operations and suppliers and the supply chains that support their operations.
|
•
|
increasing our interest expense under our revolving credit facilities or other variable-rate borrowing if interest rates were to rise; and
|
•
|
potentially limiting our ability to borrow additional funds on favorable terms, or at all.
|
•
|
the loss of any key customer, in whole or in part;
|
•
|
a declining market in which customers reduce orders or demand reduced prices; or
|
•
|
a strike or work stoppage at a key customer facility, which could affect both its suppliers and customers.
|
•
|
the unauthorized access, use, disclosure, modification or destruction of information;
|
•
|
the compromising of sensitive, confidential or personal data or information, including our intellectual property or trade secrets;
|
•
|
the improper use of our systems, software solutions or networks; and
|
•
|
production downtimes and operational disruptions.
|
•
|
the possible inability to integrate an acquired business into our operations;
|
•
|
diversion of management’s attention;
|
•
|
loss of key management personnel;
|
•
|
unanticipated problems or liabilities; and
|
•
|
increased labor and regulatory compliance costs of acquired businesses.
|
•
|
matters relating to the Merger may require substantial commitments of time and effort by our management, which could divert employees' attention away from the day-to-day operations of our business;
|
•
|
our employees may experience uncertainty about their future roles with us, which may adversely affect our ability to hire, retain and motivate key personnel and other employees;
|
•
|
customers, suppliers, strategic partners or other third parties that we maintain business relationships with may experience uncertainty prior to the closing of the Merger and seek alternative relationships with other third parties or seek to terminate or re-negotiate their relationships with us; and
|
•
|
the Merger Agreement restricts us from engaging in certain actions without the consent of ZF, which could delay or prevent us from realizing certain business opportunities or taking certain actions with respect to our operations that WABCO would otherwise take.
|
•
|
a Board of Directors that is divided into three classes with staggered terms;
|
•
|
elimination of the right of our shareholders to act by written consent;
|
•
|
rules regarding how shareholders may present proposals or nominate directors for election at shareholder meetings;
|
•
|
the right of our Board to issue preferred stock without shareholder approval; and
|
•
|
limitations on the right of shareholders to remove directors.
|
Site Location
|
|
Activity and Major Products Manufactured
|
Campinas, Brazil
|
|
Vehicle control systems
|
Jinan, China
|
|
Braking systems and compressors
|
Qingdao, China
|
|
Braking systems
|
Taishan, China
|
|
Foundation brakes
|
Shanghai, China
|
|
Engineering center
|
Rovaniemi, Finland
|
|
Test track
|
Hannover, Germany (2 sites)
|
|
Vehicle control systems and engineering center
|
Gronau, Germany
|
|
Compressors and hydraulics
|
Mannheim, Germany
|
|
Foundation brakes
|
Jeversen, Germany
|
|
Test track
|
Ambattur, India (2 sites)
|
|
Vehicle control systems and engineering center
|
Jamshedpur, India
|
|
Vehicle control systems
|
Mahindra World City, India
|
|
Vehicle control systems
|
Pantnagar, India
|
|
Vehicle control systems
|
Lucknow, India
|
|
Vehicle control systems
|
Chennai, India
|
|
Test track
|
Pune, India
|
|
Engineering center
|
Pyungtaek, Korea
|
|
Braking systems
|
Stanowice, Poland
|
|
Remanufactured products
|
Wroclaw, Poland (3 sites)
|
|
Vehicle control systems (2 plants) and engineering center
|
Miass, Russia
|
|
Actuators and foundation brakes
|
Chelny, Russia
|
|
Braking systems
|
Rayong, Thailand
|
|
Actuators and foundation brakes
|
Charleston, SC, United States
|
|
Air compressors and braking system components
|
Rochester Hills, MI, United States
|
|
Remanufactured products
|
North Mankato, MN, United States
|
|
Braking systems
|
Wytheville, VA, United States
|
|
Steering systems
|
Hebron, KY, United States
|
|
Braking systems
|
Hanover, PA, United States
|
|
Steering systems and foundry
|
Auburn Hills, MI, United States
|
|
Application engineering
|
Empalme, Mexico
|
|
Braking systems
|
Toronto, Canada
|
|
Aerodynamic products
|
Name
|
Age
|
Position(s)
|
Jacques Esculier
|
60
|
Chairman of the Board of Directors and Chief Executive Officer
|
Sean Deason
|
48
|
Chief Financial Officer and Controller
|
Lisa Brown
|
41
|
Chief Legal Officer and Secretary
|
Nick Rens
|
55
|
President EMEA
|
Mazen Mazraani
|
51
|
Chief Human Resources Officer and Vice President Communications
|
Nicolas Bardot
|
48
|
Chief Supply Chain Officer
|
Christian Brenneke
|
45
|
Chief Technology Officer
|
ITEM 5.
|
MARKET FOR THE REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
Period
|
|
Total Number of Shares Purchased
|
Average price Paid per Share
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (a)
|
Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (a)
|
||
|
|
|
|
|
|
||
Total through December 31, 2018
|
|
3,511,454
|
|
$119.60
|
3,511,454
|
|
$0
|
|
|
|
|
|
|
||
January 1 - January 31
|
|
208,000
|
|
$111.53
|
208,000
|
|
$576,800,982
|
February 1 - February 28
|
|
64,000
|
|
$115.62
|
64,000
|
|
$569,401,085
|
March 1 - March 31
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
Total first quarter
|
|
272,000
|
|
$112.50
|
272,000
|
|
$569,401,085
|
|
|
|
|
|
|
||
April 1 - April 30
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
May 1 - May 31
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
June 1 - June 30
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
Total second quarter
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
|
|
|
|
|
|
||
July 1 - July 31
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
August 1 - August 31
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
September 1 - September 30
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
Total third quarter
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
|
|
|
|
|
|
||
October 1 - October 31
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
November 1 - November 30
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
December 1 - December 31
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
Total fourth quarter
|
|
—
|
|
-
|
—
|
|
$569,401,085
|
|
|
|
|
|
|
||
Total through December 31, 2019
|
|
3,783,454
|
|
$119.09
|
3,783,454
|
|
$569,401,085
|
|
12/31/2014
|
12/31/2015
|
|
12/31/2016
|
|
12/31/2017
|
|
12/31/2018
|
|
12/31/2019
|
|
WABCO Holdings Inc.
|
100
|
97.59
|
|
101.31
|
|
136.95
|
|
102.44
|
|
129.32
|
|
S&P 500 Index
|
100
|
101.38
|
|
113.51
|
|
138.29
|
|
132.23
|
|
173.86
|
|
S&P 500 Auto Parts & Equipment Index
|
100
|
94.35
|
|
92.27
|
|
136.11
|
|
98.10
|
|
144.20
|
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
(Amounts in millions, except share and per share data)
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|||||||||||
Income Statement Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales
|
|
$
|
3,421.4
|
|
|
$
|
3,831.0
|
|
|
$
|
3,304.2
|
|
|
$
|
2,810.0
|
|
|
$
|
2,627.5
|
|
Cost of sales
|
|
2,429.4
|
|
|
2,658.5
|
|
|
2,290.4
|
|
|
1,931.0
|
|
|
1,837.6
|
|
|||||
Gross profit
|
|
992.0
|
|
|
1,172.5
|
|
|
1,013.8
|
|
|
879.0
|
|
|
789.9
|
|
|||||
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Selling and administrative expenses
|
|
463.2
|
|
|
476.0
|
|
|
411.2
|
|
|
356.6
|
|
|
346.6
|
|
|||||
Research, development and engineering expenses
|
|
193.2
|
|
|
184.4
|
|
|
147.0
|
|
|
135.2
|
|
|
139.5
|
|
|||||
Other operating (income)/expense, net
|
|
(1.5
|
)
|
|
(0.4
|
)
|
|
20.6
|
|
|
5.3
|
|
|
6.7
|
|
|||||
Operating income
|
|
337.1
|
|
|
512.5
|
|
|
435.0
|
|
|
381.9
|
|
|
297.1
|
|
|||||
Equity income of unconsolidated joint ventures
|
|
2.0
|
|
|
1.0
|
|
|
23.1
|
|
|
24.8
|
|
|
32.1
|
|
|||||
Gain on remeasurement of equity investments (1)
|
|
—
|
|
|
—
|
|
|
247.7
|
|
|
—
|
|
|
—
|
|
|||||
Other non-operating expense, net
|
|
(26.2
|
)
|
|
(42.3
|
)
|
|
(37.2
|
)
|
|
(24.9
|
)
|
|
(24.6
|
)
|
|||||
Interest expense, net
|
|
(0.1
|
)
|
|
(7.5
|
)
|
|
(16.0
|
)
|
|
(12.7
|
)
|
|
(7.1
|
)
|
|||||
Income before income taxes
|
|
312.8
|
|
|
463.7
|
|
|
652.6
|
|
|
369.1
|
|
|
297.5
|
|
|||||
Income tax expense (2)
|
|
53.4
|
|
|
49.3
|
|
|
229.7
|
|
|
121.8
|
|
|
11.5
|
|
|||||
Net income including noncontrolling interests
|
|
259.4
|
|
|
414.4
|
|
|
422.9
|
|
|
247.3
|
|
|
286.0
|
|
|||||
Less: net income attributable to noncontrolling interests
|
|
13.6
|
|
|
20.3
|
|
|
16.8
|
|
|
24.3
|
|
|
10.8
|
|
|||||
Net income
|
|
$
|
245.8
|
|
|
$
|
394.1
|
|
|
$
|
406.1
|
|
|
$
|
223.0
|
|
|
$
|
275.2
|
|
Per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
$
|
4.80
|
|
|
$
|
7.46
|
|
|
$
|
7.53
|
|
|
$
|
4.00
|
|
|
$
|
4.76
|
|
Diluted
|
|
$
|
4.78
|
|
|
$
|
7.43
|
|
|
$
|
7.50
|
|
|
$
|
3.98
|
|
|
$
|
4.72
|
|
Average number of outstanding common shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Basic
|
|
51,242,913
|
|
|
52,846,962
|
|
|
53,903,938
|
|
|
55,695,738
|
|
|
57,768,018
|
|
|||||
Diluted
|
|
51,398,548
|
|
|
53,062,573
|
|
|
54,139,815
|
|
|
55,981,816
|
|
|
58,274,987
|
|
|||||
Balance Sheet Data (at end of period):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total assets
|
|
$
|
4,037.1
|
|
|
$
|
3,738.6
|
|
|
$
|
4,323.4
|
|
|
$
|
3,056.0
|
|
|
$
|
2,589.9
|
|
Total debt
|
|
$
|
828.3
|
|
|
$
|
845.2
|
|
|
$
|
1,409.8
|
|
|
$
|
959.1
|
|
|
$
|
503.7
|
|
Total shareholders' equity
|
|
$
|
1,340.2
|
|
|
$
|
1,176.8
|
|
|
$
|
1,121.4
|
|
|
$
|
701.4
|
|
|
$
|
786.7
|
|
Cash dividends per common share
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
ITEM 7.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
Year to Year Change
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|||||
Sales to European T&B OEMs (at constant FX rates)
|
|
8
|
%
|
|
8
|
%
|
|
6
|
%
|
|
3
|
%
|
|
(9
|
)%
|
European T&B Production
|
|
6
|
%
|
|
1
|
%
|
|
8
|
%
|
|
2
|
%
|
|
(8
|
)%
|
Year to Year Change
|
2015
|
2016
|
2017
|
2018
|
2019
|
Average
Change
|
||||||
Aftermarket Sales (at constant FX rates)
|
7
|
%
|
6
|
%
|
9
|
%
|
18
|
%
|
(3
|
)%
|
7
|
%
|
|
2019
|
|
2018
|
|
2017
|
|||
OE Manufacturers:
|
|
|
|
|
|
|||
Truck & Bus products
|
54
|
%
|
|
55
|
%
|
|
58
|
%
|
Trailer products
|
10
|
%
|
|
10
|
%
|
|
9
|
%
|
Car products
|
5
|
%
|
|
5
|
%
|
|
6
|
%
|
Off highway
|
5
|
%
|
|
5
|
%
|
|
4
|
%
|
Aftermarket
|
26
|
%
|
|
25
|
%
|
|
23
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Geography:
|
|
|
|
|
|
|
|
|
Europe
|
48
|
%
|
|
49
|
%
|
|
52
|
%
|
North America
|
24
|
%
|
|
23
|
%
|
|
18
|
%
|
South America
|
4
|
%
|
|
3
|
%
|
|
3
|
%
|
Asia
|
22
|
%
|
|
24
|
%
|
|
26
|
%
|
Other
|
2
|
%
|
|
1
|
%
|
|
1
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
Year ended
December 31,
|
|
|
|
Excluding Foreign
Exchange Translation **
|
||||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
% change
reported
|
|
2019 adjusted
amount
|
|
% change
adjusted
|
||||||||
Sales
|
$
|
3,421.4
|
|
|
$
|
3,831.0
|
|
|
(10.7
|
)%
|
|
$
|
3,563.9
|
|
|
(7.0
|
)%
|
Cost of sales
|
2,429.4
|
|
|
2,658.5
|
|
|
(8.6
|
)%
|
|
2,526.7
|
|
|
(5.0
|
)%
|
|||
Gross profit
|
992.0
|
|
|
1,172.5
|
|
|
(15.4
|
)%
|
|
1,037.2
|
|
|
(11.5
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses
|
654.9
|
|
|
660.0
|
|
|
(0.8
|
)%
|
|
683.7
|
|
|
3.6
|
%
|
|||
Other non-operating expense, net
|
(26.2
|
)
|
|
(42.3
|
)
|
|
(38.1
|
)%
|
|
(29.0
|
)
|
|
(31.4
|
)%
|
|||
Interest expense, net
|
(0.1
|
)
|
|
(7.5
|
)
|
|
(98.7
|
)%
|
|
0.2
|
|
|
(102.7
|
)%
|
|||
Income tax expense
|
53.4
|
|
|
49.3
|
|
|
8.3
|
%
|
|
55.3
|
|
|
12.2
|
%
|
|||
Net income attributable to noncontrolling interests
|
13.6
|
|
|
20.3
|
|
|
(33.0
|
)%
|
|
13.8
|
|
|
(32.0
|
)%
|
(Amounts in millions)
|
Cost of Sales
|
|
Gross Profit
|
||||
Cost of sales / gross profit for the year ended December 31, 2018
|
$
|
2,658.5
|
|
|
$
|
1,172.5
|
|
|
|
|
|
||||
Increase/(decrease) due to:
|
|
|
|
||||
Sales pricing, volume and mix
|
—
|
|
|
(267.1
|
)
|
||
Cost of materials
|
(151.2
|
)
|
|
151.2
|
|
||
Cost of manufacturing workforce
|
(7.8
|
)
|
|
7.8
|
|
||
Streamlining costs
|
17.3
|
|
|
(17.3
|
)
|
||
Warranty accruals
|
4.4
|
|
|
(4.4
|
)
|
||
Foreign exchange translational effects
|
(97.3
|
)
|
|
(45.2
|
)
|
||
Other
|
5.5
|
|
|
(5.5
|
)
|
||
Net decrease
|
(229.1
|
)
|
|
(180.5
|
)
|
||
|
|
|
|
||||
Cost of sales / gross profit for the year ended December 31, 2019
|
$
|
2,429.4
|
|
|
$
|
992.0
|
|
(Amounts in millions)
|
|
||
Operating expenses for the year ended December 31, 2018
|
$
|
660.0
|
|
|
|
||
Increase/(decrease) due to:
|
|
||
Labor inflation
|
18.7
|
|
|
Sell-side M&A activity (1)
|
18.0
|
|
|
Employee-related costs
|
1.4
|
|
|
Stock compensation costs
|
(10.8
|
)
|
|
Streamlining
|
(2.1
|
)
|
|
Headquarters relocation costs
|
3.9
|
|
|
Environmental reserve reduction
|
(3.8
|
)
|
|
Foreign exchange translation
|
(28.8
|
)
|
|
Other
|
(1.6
|
)
|
|
Net decrease
|
(5.1
|
)
|
|
|
|
||
Operating expenses for the year ended December 31, 2019
|
$
|
654.9
|
|
|
Year ended
December 31,
|
|
|
|
Excluding Foreign
Exchange Translation **
|
||||||||||||
(Amounts in millions)
|
2018
|
|
2017
|
|
% change
reported
|
|
2018 adjusted
amount
|
|
% change
adjusted
|
||||||||
Sales
|
$
|
3,831.0
|
|
|
$
|
3,304.2
|
|
|
15.9
|
%
|
|
$
|
3,763.7
|
|
|
13.9
|
%
|
Cost of sales
|
2,658.5
|
|
|
2,290.4
|
|
|
16.1
|
%
|
|
2,622.7
|
|
|
14.5
|
%
|
|||
Gross profit
|
1,172.5
|
|
|
1,013.8
|
|
|
15.7
|
%
|
|
1,141.0
|
|
|
12.5
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses
|
660.0
|
|
|
578.8
|
|
|
14.0
|
%
|
|
644.5
|
|
|
11.4
|
%
|
|||
Equity in net income of unconsolidated joint ventures
|
1.0
|
|
|
23.1
|
|
|
(95.7
|
)%
|
|
1.0
|
|
|
(95.7
|
)%
|
|||
Gain on remeasurement of equity investments
|
—
|
|
|
247.7
|
|
|
*
|
|
|
—
|
|
|
*
|
|
|||
Other non operating expense, net
|
(42.3
|
)
|
|
(37.2
|
)
|
|
13.7
|
%
|
|
(37.5
|
)
|
|
0.8
|
%
|
|||
Interest expense, net
|
(7.5
|
)
|
|
(16.0
|
)
|
|
(53.1
|
)%
|
|
(7.4
|
)
|
|
(53.8
|
)%
|
|||
Income tax expense
|
49.3
|
|
|
229.7
|
|
|
(78.5
|
)%
|
|
48.9
|
|
|
(78.7
|
)%
|
|||
Net income attributable to noncontrolling interests
|
20.3
|
|
|
16.8
|
|
|
20.8
|
%
|
|
20.8
|
|
|
23.8
|
%
|
(Amounts in millions)
|
Cost of Sales
|
|
Gross Profit
|
||||
Cost of sales / gross profit for the year ended December 31, 2017
|
$
|
2,290.4
|
|
|
$
|
1,013.8
|
|
|
|
|
|
||||
Increase/(decrease) due to:
|
|
|
|
||||
Sales pricing, volume and mix
|
—
|
|
|
237.2
|
|
||
Cost of materials
|
152.3
|
|
|
(152.3
|
)
|
||
Cost of manufacturing workforce
|
24.4
|
|
|
(24.4
|
)
|
||
U.S. acquisitions
|
145.1
|
|
|
77.1
|
|
||
Streamlining costs
|
(4.4
|
)
|
|
4.4
|
|
||
Foreign exchange translational effects
|
35.9
|
|
|
31.5
|
|
||
Other
|
14.8
|
|
|
(14.8
|
)
|
||
Net increase
|
368.1
|
|
|
158.7
|
|
||
|
|
|
|
||||
Cost of sales / gross profit for the year ended December 31, 2018
|
$
|
2,658.5
|
|
|
$
|
1,172.5
|
|
(Amounts in millions)
|
|
||
Operating expenses for the year ended December 31, 2017
|
$
|
578.8
|
|
|
|
||
Increase/(decrease) due to:
|
|
||
Labor inflation
|
15.6
|
|
|
Incentive compensation
|
(5.3
|
)
|
|
Incremental costs from U.S. acquisitions (1)
|
37.8
|
|
|
Streamlining
|
7.0
|
|
|
Pension and post retirement benefit costs
|
3.3
|
|
|
Foreign exchange translation
|
15.5
|
|
|
Indemnification costs (2)
|
(14.9
|
)
|
|
Research and development investments, net
|
15.9
|
|
|
Other
|
6.3
|
|
|
Net increase
|
81.2
|
|
|
|
|
||
Operating expenses for the year ended December 31, 2018
|
$
|
660.0
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
(Amounts in millions)
|
Repurchase Agreements
|
|
Short-term Investments
|
|
Total
|
|
Repurchase Agreements
|
|
Short-term Investments
|
|
Total
|
||||||||||||
Investments
|
$
|
113.3
|
|
|
$
|
633.2
|
|
|
$
|
746.5
|
|
|
$
|
161.2
|
|
|
$
|
526.0
|
|
|
$
|
687.2
|
|
Sales and redemptions
|
198.4
|
|
|
693.5
|
|
|
891.9
|
|
|
210.3
|
|
|
374.9
|
|
|
585.2
|
|
||||||
Net cash received/(invested)
|
$
|
85.1
|
|
|
$
|
60.3
|
|
|
$
|
145.4
|
|
|
$
|
49.1
|
|
|
$
|
(151.1
|
)
|
|
$
|
(102.0
|
)
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||
(Amounts in millions)
|
Repurchase Agreements
|
|
Short-term Investments
|
|
Total
|
|
Repurchase Agreements
|
|
Short-term Investments
|
|
Total
|
||||||||||||
Investments
|
$
|
161.2
|
|
|
$
|
526.0
|
|
|
$
|
687.2
|
|
|
$
|
312.2
|
|
|
$
|
223.0
|
|
|
$
|
535.2
|
|
Sales and redemptions
|
210.3
|
|
|
374.9
|
|
|
585.2
|
|
|
318.4
|
|
|
230.0
|
|
|
548.4
|
|
||||||
Net cash received/(invested)
|
$
|
49.1
|
|
|
$
|
(151.1
|
)
|
|
$
|
(102.0
|
)
|
|
$
|
6.2
|
|
|
$
|
7.0
|
|
|
$
|
13.2
|
|
(Amounts in millions)
|
Face value
|
|
Coupon
|
Maturity date
|
||
Fixed rate term loan - Series A
|
€
|
10.0
|
|
|
0.85%
|
March 31, 2021
|
Fixed rate term loan - Series B
|
60.0
|
|
|
1.15%
|
March 31, 2022
|
|
Fixed rate term loan - Series C
|
80.0
|
|
|
1.43%
|
March 31, 2023
|
|
Floating rate term loan - Series A
|
50.0
|
|
|
6-month EURIBOR plus 80 bps
|
March 31, 2021
|
|
Floating rate term loan - Series B
|
60.0
|
|
|
6-month EURIBOR plus 90 bps
|
March 31, 2022
|
|
Floating rate term loan - Series C
|
40.0
|
|
|
6-month EURIBOR plus 100 bps
|
March 31, 2023
|
|
|
€
|
300.0
|
|
|
|
|
|
|
Payments due by period
|
||||||||||||||||||
(Amounts in millions)
|
|
Total
|
|
2020
|
|
2021 and 2022
|
|
2023 and 2024
|
|
Beyond 2024
|
||||||||||
Debt obligations (1)
|
|
$
|
876.7
|
|
|
$
|
9.1
|
|
|
$
|
218.1
|
|
|
$
|
357.0
|
|
|
$
|
292.5
|
|
Lease obligations (2)
|
|
108.1
|
|
|
29.4
|
|
|
35.5
|
|
|
18.0
|
|
|
25.2
|
|
|||||
Purchase obligations (3)
|
|
225.0
|
|
|
225.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Pension and post-retirement contributions (4)
|
|
300.0
|
|
|
27.7
|
|
|
56.5
|
|
|
59.6
|
|
|
156.2
|
|
|||||
Purchase of distribution rights (5)
|
|
265.0
|
|
|
265.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Transition tax payable (6)
|
|
157.7
|
|
|
4.0
|
|
|
32.4
|
|
|
70.7
|
|
|
50.6
|
|
|||||
Total
|
|
$
|
1,932.5
|
|
|
$
|
560.2
|
|
|
$
|
342.5
|
|
|
$
|
505.3
|
|
|
$
|
524.5
|
|
(1)
|
Includes principal and interest payments due on our senior unsecured debt. For floating rate debt, interest payments were calculated based on the applicable interest rates as of December 31, 2019. Payment obligations denominated in a foreign currency were calculated using the local currency foreign exchange rates in effect at December 31, 2019. See Note 16 to of Notes to the Consolidated Financial Statements for additional information.
|
(2)
|
Includes future rental commitments under all non-cancelable operating leases in effect at December 31, 2019.
|
(3)
|
In the normal course of business we expect to purchase approximately $1.9 billion in 2020 of materials and services, and estimate that on average no more than approximately $225.0 million is outstanding at any one time in the form of legally binding commitments. We spent approximately $2.1 billion, $2.3 billion and $2.0 billion on materials and services in 2019, 2018 and 2017, respectively.
|
(4)
|
Amounts represent undiscounted projected benefit payments over the next ten years and represent our best estimate of future contributions to our pension and post-retirement benefit plans. The expected benefit payments have been estimated based on the same assumptions that were used to measure our accumulated benefit obligation as of December 31, 2019 and include benefits attributable to estimated future service of current employees.
|
(5)
|
Relates to the purchase of the distribution rights from Meritor for WABCO aftermarket products in the United States and Canada. The final purchase price will be determined in early 2020 and could be for an amount less than $265 million.
|
(6)
|
Includes a one-time repatriation tax resulting from the Tax Cuts and Jobs Act. The Tax Cuts and Jobs Act permits the Company to pay the tax liability interest free over a period of up to eight years.
|
Item 8.
|
Financial Statements and Supplementary Data
|
Description of the Matter
|
|
The Company's aggregate defined benefit pension obligation was $1,006.3 million as of December 31, 2019. As described in Note 15 to the consolidated financial statements, the weighted average discount rate used in estimating the net defined benefit pension plan obligation as of December 31, 2019, was 1.21%. The discount rate is estimated using indices including highly-rated bonds matching the duration of the liability.
Given the significance of the pension obligation and its sensitivity to a change in the weighted average discount rate, performing audit procedures to evaluate management’s selected discount rates for the individual pension plans, required a high degree of auditor judgment and an increased extent of effort, including the need to involve our actuarial specialists.
|
How We Addressed the Matter in Our Audit
|
|
We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over management’s determination of the discount rates used. For example, we tested controls over management’s review of the appropriateness of the model used to develop the discount rates and the indices selected, the duration used, and its approval of the discount rate.
To determine the appropriateness of the discount rates used in estimating the net defined benefit pension plan obligation, we involved our actuarial specialists to assist us to perform our audit procedures. These procedures included, amongst others, evaluating management’s methodology used to develop the discount rates for consistency with prior periods. We assessed the appropriateness of the discount rates selected by management by benchmarking against discounts rates independently developed by our actuarial specialist. This included consideration of bond indices that reflect the duration of the benefit payments. We also compared the projected cash flows to the prior year projections and compared the current year benefits paid to the prior year projected cash flows.
|
Description of the Matter
|
|
As discussed in Note 18 to the consolidated financial statements, the Company had unrecognized tax benefits (including accrued interest) as of December 31, 2019 amounting to $35.3 million. The Company conducts its business globally and, as a result, is subject to audit by local taxing authorities for its various global subsidiaries and the resolution of such audits may span multiple years. Uncertainty in a tax position may arise because tax laws are complex and subject to varied interpretation. Accordingly, the ultimate outcome with respect to tax positions may differ from the amounts recognized. The Company uses significant judgment to determine whether, based on the technical merits, a tax position is more likely than not to be sustained.
Auditing management’s analysis of the Company’s unrecognized tax benefits and the related impact on the income tax expense and liability is challenging because the analysis is complex and involves significant management judgment and estimation, requiring a high degree of auditor judgment in evaluating the Company’s interpretation of, and compliance with, tax laws across its multiple subsidiaries. Each unrecognized tax benefit involves unique facts and circumstances and multiple potential outcomes that must be evaluated for multiple jurisdictions. There are many uncertainties around initial recognition including regulatory changes, litigation and examination activity.
|
How We Addressed the Matter in Our Audit
|
|
We obtained an understanding, evaluated the design and tested the operating effectiveness of the Company’s controls that address the risks of material misstatement relating to unrecognized tax benefits. For example, we tested controls over management’s identification of various unrecognized tax benefits, its assessment and interpretation of tax laws, its evaluation of which tax positions may not be sustained upon audit and projected outcome upon examination by the tax authorities.
Our audit procedures included, among others, evaluating the assumptions the Company used to determine its unrecognized tax benefits by jurisdiction. We tested the completeness and accuracy of the underlying data used by the Company to calculate its tax positions. We also assessed the historical accuracy of management’s estimates of its unrecognized tax benefits by comparing the estimates with the resolution of the related positions or upon completion of the audit by the income tax authorities. In addition, we involved our tax professionals to assist us to evaluate the Company’s interpretation and application of relevant tax laws and regulations in the Company’s various jurisdictions in determining their unrecognized tax benefits. We also evaluated management’s disclosures about its unrecognized tax benefits.
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions, except share and per share data)
|
2019
|
|
2018
|
|
2017
|
||||||
Sales
|
$
|
3,421.4
|
|
|
$
|
3,831.0
|
|
|
$
|
3,304.2
|
|
Cost of sales
|
2,429.4
|
|
|
2,658.5
|
|
|
2,290.4
|
|
|||
Gross profit
|
992.0
|
|
|
1,172.5
|
|
|
1,013.8
|
|
|||
Costs and expenses:
|
|
|
|
|
|
||||||
Selling and administrative expenses
|
463.2
|
|
|
476.0
|
|
|
411.2
|
|
|||
Research, development and engineering expenses
|
193.2
|
|
|
184.4
|
|
|
147.0
|
|
|||
Other operating (income)/expense, net
|
(1.5
|
)
|
|
(0.4
|
)
|
|
20.6
|
|
|||
Operating income
|
337.1
|
|
|
512.5
|
|
|
435.0
|
|
|||
Equity income of unconsolidated joint ventures, net
|
2.0
|
|
|
1.0
|
|
|
23.1
|
|
|||
Gain on remeasurement of equity investments
|
—
|
|
|
—
|
|
|
247.7
|
|
|||
Other non-operating expense, net
|
(26.2
|
)
|
|
(42.3
|
)
|
|
(37.2
|
)
|
|||
Interest expense, net
|
(0.1
|
)
|
|
(7.5
|
)
|
|
(16.0
|
)
|
|||
Income before income taxes
|
312.8
|
|
|
463.7
|
|
|
652.6
|
|
|||
Income tax expense
|
53.4
|
|
|
49.3
|
|
|
229.7
|
|
|||
Net income including noncontrolling interests
|
259.4
|
|
|
414.4
|
|
|
422.9
|
|
|||
Less: net income attributable to noncontrolling interests
|
13.6
|
|
|
20.3
|
|
|
16.8
|
|
|||
Net income attributable to Company
|
$
|
245.8
|
|
|
$
|
394.1
|
|
|
$
|
406.1
|
|
Net income attributable to Company per common share
|
|
|
|
|
|
||||||
Basic
|
$
|
4.80
|
|
|
$
|
7.46
|
|
|
$
|
7.53
|
|
Diluted
|
$
|
4.78
|
|
|
$
|
7.43
|
|
|
$
|
7.50
|
|
Cash dividends per share of common stock
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Weighted average common shares outstanding
|
|
|
|
|
|
||||||
Basic
|
51,242,913
|
|
|
52,846,962
|
|
|
53,903,938
|
|
|||
Diluted
|
51,398,548
|
|
|
53,062,573
|
|
|
54,139,815
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Net income including noncontrolling interests
|
$
|
259.4
|
|
|
$
|
414.4
|
|
|
$
|
422.9
|
|
Other comprehensive (loss)/income:
|
|
|
|
|
|
||||||
Currency translation adjustments
|
(9.5
|
)
|
|
(71.2
|
)
|
|
154.2
|
|
|||
Pensions and post-retirement benefit plan adjustments, net
|
(48.3
|
)
|
|
5.0
|
|
|
(38.0
|
)
|
|||
Unrealized gains on hedges, net
|
—
|
|
|
0.8
|
|
|
0.2
|
|
|||
Unrealized losses on investments, net
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|||
Total other comprehensive (loss)/income
|
$
|
(57.8
|
)
|
|
$
|
(65.4
|
)
|
|
$
|
116.3
|
|
Comprehensive income
|
201.6
|
|
|
349.0
|
|
|
539.2
|
|
|||
Less: Comprehensive income attributable to noncontrolling interests
|
12.1
|
|
|
14.4
|
|
|
20.3
|
|
|||
Comprehensive income attributable to Company
|
$
|
189.5
|
|
|
$
|
334.6
|
|
|
$
|
518.9
|
|
|
December 31,
2019 |
|
December 31,
2018 |
||||
(Amounts in millions, except share data)
|
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
891.8
|
|
|
$
|
503.8
|
|
Short-term investments
|
67.6
|
|
|
135.8
|
|
||
Accounts receivable, net
|
523.3
|
|
|
611.5
|
|
||
Inventories, net
|
292.9
|
|
|
319.1
|
|
||
Guaranteed notes receivable
|
35.0
|
|
|
44.1
|
|
||
Investments in repurchase agreements
|
—
|
|
|
85.8
|
|
||
Other current assets
|
103.7
|
|
|
96.8
|
|
||
Total current assets
|
1,914.3
|
|
|
1,796.9
|
|
||
Property, plant and equipment, net
|
593.0
|
|
|
553.6
|
|
||
Operating lease right-of-use assets
|
100.8
|
|
|
—
|
|
||
Goodwill
|
802.5
|
|
|
809.4
|
|
||
Deferred tax assets
|
275.0
|
|
|
236.7
|
|
||
Investments in unconsolidated joint ventures
|
11.5
|
|
|
10.4
|
|
||
Intangible assets, net
|
226.9
|
|
|
246.6
|
|
||
Other assets
|
113.1
|
|
|
85.0
|
|
||
TOTAL ASSETS
|
$
|
4,037.1
|
|
|
$
|
3,738.6
|
|
LIABILITIES AND EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Loans payable to banks
|
$
|
—
|
|
|
$
|
—
|
|
Accounts payable
|
185.0
|
|
|
232.5
|
|
||
Accrued payroll
|
108.3
|
|
|
111.2
|
|
||
Current portion of warranties
|
28.1
|
|
|
23.3
|
|
||
VAT payable
|
11.4
|
|
|
15.7
|
|
||
Accrued expenses
|
68.7
|
|
|
73.8
|
|
||
Promotion and customer incentives
|
24.8
|
|
|
26.6
|
|
||
Accrued income tax
|
24.1
|
|
|
28.2
|
|
||
Other accrued liabilities
|
121.1
|
|
|
84.7
|
|
||
Total current liabilities
|
571.5
|
|
|
596.0
|
|
||
Long-term debt
|
828.3
|
|
|
845.2
|
|
||
Operating lease liabilities
|
74.2
|
|
|
—
|
|
||
Pension and post-retirement benefits
|
821.8
|
|
|
716.0
|
|
||
Deferred tax liabilities
|
71.2
|
|
|
75.4
|
|
||
Long-term income tax liabilities
|
156.9
|
|
|
156.8
|
|
||
Other liabilities
|
77.1
|
|
|
84.0
|
|
||
Total liabilities
|
2,601.0
|
|
|
2,473.4
|
|
||
Shareholders’ equity:
|
|
|
|
||||
Preferred stock, 4,000,000 shares authorized; none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value, 400,000,000 shares authorized; shares issued: 79,147,135 in 2019; 79,018,266 in 2018; and shares outstanding: 51,267,324 in 2019; 51,364,925 in 2018
|
0.8
|
|
|
0.8
|
|
||
Capital surplus
|
902.1
|
|
|
898.5
|
|
||
Treasury stock, at cost: 27,879,811 shares in 2019; 27,653,341 shares in 2018
|
(2,186.3
|
)
|
|
(2,159.3
|
)
|
||
Retained earnings
|
3,212.3
|
|
|
2,960.8
|
|
||
Accumulated other comprehensive loss
|
(588.7
|
)
|
|
(524.0
|
)
|
||
Total shareholders’ equity
|
1,340.2
|
|
|
1,176.8
|
|
||
Noncontrolling interests
|
95.9
|
|
|
88.4
|
|
||
Total equity
|
1,436.1
|
|
|
1,265.2
|
|
||
TOTAL LIABILITIES AND EQUITY
|
$
|
4,037.1
|
|
|
$
|
3,738.6
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Operating activities:
|
|
|
|
|
|
||||||
Net income including noncontrolling interests
|
$
|
259.4
|
|
|
$
|
414.4
|
|
|
$
|
422.9
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation
|
95.1
|
|
|
95.8
|
|
|
84.8
|
|
|||
Change in fair value of non-marketable equity securities
|
(2.2
|
)
|
|
5.5
|
|
|
—
|
|
|||
Amortization of intangibles
|
28.5
|
|
|
28.9
|
|
|
22.3
|
|
|||
Equity in earnings of unconsolidated joint ventures, net of dividends received
|
0.3
|
|
|
(1.0
|
)
|
|
0.8
|
|
|||
Non-cash stock compensation
|
9.2
|
|
|
20.0
|
|
|
16.4
|
|
|||
Non-cash interest expense and debt issuance cost amortization
|
9.9
|
|
|
15.4
|
|
|
23.1
|
|
|||
Deferred income tax benefit
|
(19.4
|
)
|
|
(23.6
|
)
|
|
(48.2
|
)
|
|||
Pension and post-retirement benefit expense
|
64.7
|
|
|
62.2
|
|
|
57.5
|
|
|||
Gain on remeasurement of equity investments
|
—
|
|
|
—
|
|
|
(247.7
|
)
|
|||
Foreign currency effects on changes in monetary assets/liabilities
|
0.3
|
|
|
(2.3
|
)
|
|
(6.8
|
)
|
|||
Unrealized (gain)/loss on revaluation of foreign currency forward contracts
|
(0.4
|
)
|
|
2.5
|
|
|
(1.7
|
)
|
|||
Loss on debt extinguishment
|
—
|
|
|
2.3
|
|
|
—
|
|
|||
Other
|
1.7
|
|
|
2.8
|
|
|
0.6
|
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable, net
|
79.2
|
|
|
27.5
|
|
|
(64.3
|
)
|
|||
Inventories, net
|
21.2
|
|
|
(13.4
|
)
|
|
(16.0
|
)
|
|||
Accounts payable
|
(43.2
|
)
|
|
(23.8
|
)
|
|
5.4
|
|
|||
Other accrued liabilities and taxes
|
(8.6
|
)
|
|
(66.8
|
)
|
|
12.6
|
|
|||
Other current and long-term assets
|
(27.8
|
)
|
|
(40.5
|
)
|
|
27.4
|
|
|||
Other long-term liabilities
|
(4.1
|
)
|
|
(11.5
|
)
|
|
157.1
|
|
|||
Pension and post-retirement benefit contributions
|
(23.9
|
)
|
|
(25.9
|
)
|
|
(24.7
|
)
|
|||
Net cash provided by operating activities
|
439.9
|
|
|
468.5
|
|
|
421.5
|
|
|||
Investing activities:
|
|
|
|
|
|
||||||
Purchases of property, plant and equipment
|
(144.8
|
)
|
|
(118.2
|
)
|
|
(104.7
|
)
|
|||
Investments in capitalized software
|
(8.8
|
)
|
|
(13.9
|
)
|
|
(5.8
|
)
|
|||
Purchases of short-term investments and repurchase agreements
|
(746.5
|
)
|
|
(687.2
|
)
|
|
(535.2
|
)
|
|||
Sales and maturities of short-term investments and repurchase agreements
|
891.9
|
|
|
585.2
|
|
|
548.4
|
|
|||
Cost of preferred stock investment
|
—
|
|
|
—
|
|
|
(10.0
|
)
|
|||
Return of investment in unconsolidated joint venture
|
—
|
|
|
—
|
|
|
1.8
|
|
|||
Investment in unconsolidated joint ventures
|
(1.8
|
)
|
|
(3.8
|
)
|
|
—
|
|
|||
Acquisitions of businesses, net
|
(0.4
|
)
|
|
(8.6
|
)
|
|
(382.7
|
)
|
|||
Net cash used by investing activities
|
(10.4
|
)
|
|
(246.5
|
)
|
|
(488.2
|
)
|
|||
Financing activities:
|
|
|
|
|
|
||||||
Borrowings of long-term debt
|
—
|
|
|
368.5
|
|
|
25.3
|
|
|||
Repayments of long-term debt
|
—
|
|
|
(500.0
|
)
|
|
(25.0
|
)
|
|||
Net borrowings/(repayments) of short-term debt
|
—
|
|
|
(385.4
|
)
|
|
382.5
|
|
|||
Settlement of forward contract
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
|||
Taxes withheld and paid on employee stock award vestings
|
(5.0
|
)
|
|
(5.1
|
)
|
|
(4.9
|
)
|
|||
Purchases of treasury stock
|
(30.6
|
)
|
|
(300.0
|
)
|
|
(120.0
|
)
|
|||
Proceeds from noncontrolling interest shareholders, net
|
2.8
|
|
|
—
|
|
|
0.6
|
|
|||
Dividends to noncontrolling interest holders
|
(7.4
|
)
|
|
(5.7
|
)
|
|
(7.1
|
)
|
|||
Proceeds from exercise of stock options
|
1.2
|
|
|
0.6
|
|
|
9.5
|
|
|||
Net cash (used)/provided by financing activities
|
(39.0
|
)
|
|
(827.1
|
)
|
|
260.6
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(2.4
|
)
|
|
(32.2
|
)
|
|
85.1
|
|
|||
Net increase/(decrease) in cash and cash equivalents
|
388.1
|
|
|
(637.3
|
)
|
|
279.0
|
|
|||
Cash and cash equivalents at beginning of period
|
504.2
|
|
|
1,141.5
|
|
|
862.5
|
|
|||
Cash and cash equivalents at end of period
|
$
|
892.3
|
|
|
$
|
504.2
|
|
|
$
|
1,141.5
|
|
|
|
|
|
|
|
||||||
|
|
|
|
|
|
||||||
|
|
|
|
|
|
(Amounts in millions)
|
Common
Stock
|
|
Capital
Surplus
|
|
Treasury
Stock
|
|
Retained
Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
Non Controlling Interests
|
|
Total
|
||||||||||||||
Balance at December 31, 2016
|
$
|
0.8
|
|
|
$
|
861.2
|
|
|
$
|
(1,744.4
|
)
|
|
$
|
2,161.1
|
|
|
$
|
(577.3
|
)
|
|
$
|
65.9
|
|
|
$
|
767.3
|
|
Net income
|
|
|
—
|
|
|
—
|
|
|
406.1
|
|
|
—
|
|
|
16.8
|
|
|
422.9
|
|
||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
112.8
|
|
|
3.5
|
|
|
116.3
|
|
|||||||
Treasury stock purchased
|
—
|
|
|
—
|
|
|
(120.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(120.0
|
)
|
|||||||
Stock options exercised
|
—
|
|
|
9.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9.5
|
|
|||||||
Treasury stock reissued
|
—
|
|
|
0.9
|
|
|
3.1
|
|
|
(4.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock-based compensation
|
—
|
|
|
11.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11.6
|
|
|||||||
Dividends paid
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7.1
|
)
|
|
(7.1
|
)
|
|||||||
Proceeds from minority interest shareholders
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.6
|
|
|
0.6
|
|
|||||||
Balance at December 31, 2017
|
$
|
0.8
|
|
|
$
|
883.2
|
|
|
$
|
(1,861.3
|
)
|
|
$
|
2,563.2
|
|
|
$
|
(464.5
|
)
|
|
$
|
79.7
|
|
|
$
|
1,201.1
|
|
Adoption of ASU 2016–16
|
—
|
|
|
—
|
|
|
—
|
|
|
5.3
|
|
|
—
|
|
|
—
|
|
|
5.3
|
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
394.1
|
|
|
—
|
|
|
20.3
|
|
|
414.4
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(59.5
|
)
|
|
(5.9
|
)
|
|
(65.4
|
)
|
|||||||
Treasury stock purchased
|
—
|
|
|
—
|
|
|
(300.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(300.0
|
)
|
|||||||
Stock options exercised
|
—
|
|
|
0.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.6
|
|
|||||||
Treasury stock reissued
|
—
|
|
|
(0.2
|
)
|
|
2.0
|
|
|
(1.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock-based compensation
|
—
|
|
|
14.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14.9
|
|
|||||||
Dividends paid
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5.7
|
)
|
|
(5.7
|
)
|
|||||||
Balance at December 31, 2018
|
$
|
0.8
|
|
|
$
|
898.5
|
|
|
$
|
(2,159.3
|
)
|
|
$
|
2,960.8
|
|
|
$
|
(524.0
|
)
|
|
$
|
88.4
|
|
|
$
|
1,265.2
|
|
Adoption of ASU 2018-02
|
—
|
|
|
—
|
|
|
—
|
|
|
8.4
|
|
|
(8.4
|
)
|
|
|
|
|
—
|
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
245.8
|
|
|
—
|
|
|
13.6
|
|
|
259.4
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(56.3
|
)
|
|
(1.5
|
)
|
|
(57.8
|
)
|
|||||||
Treasury stock purchased
|
—
|
|
|
—
|
|
|
(30.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(30.6
|
)
|
|||||||
Stock options exercised
|
—
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|||||||
Treasury stock reissued
|
—
|
|
|
—
|
|
|
3.6
|
|
|
(2.7
|
)
|
|
—
|
|
|
—
|
|
|
0.9
|
|
|||||||
Stock-based compensation
|
—
|
|
|
4.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.2
|
|
|||||||
Dividends paid
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7.4
|
)
|
|
(7.4
|
)
|
|||||||
Changes in ownership of noncontrolling interests
|
—
|
|
|
(0.9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.1
|
)
|
|
(2.0
|
)
|
|||||||
Proceeds from minority interest shareholders
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.9
|
|
|
3.9
|
|
|||||||
Balance at December 31, 2019
|
$
|
0.8
|
|
|
$
|
902.1
|
|
|
$
|
(2,186.3
|
)
|
|
$
|
3,212.3
|
|
|
$
|
(588.7
|
)
|
|
$
|
95.9
|
|
|
$
|
1,436.1
|
|
NOTE 1.
|
Description of Company
|
NOTE 2.
|
Summary of Significant Accounting Policies
|
–
|
Level 2 - Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
|
–
|
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
|
Year Ended December 31,
|
|||||||
|
2019
|
|
2018
|
|
2017
|
|||
Weighted average incremental shares included in diluted EPS
|
155,635
|
|
|
215,611
|
|
|
235,877
|
|
Shares excluded due to anti-dilutive effect on earnings per share
|
—
|
|
|
70
|
|
|
1,626
|
|
NOTE 4.
|
Revenue from Contracts with Customers
|
|
|
Year Ended December 31,
|
||||||||||
(Amount in millions)
|
|
2019
|
|
2018
|
|
2017
|
||||||
OEM (1)
|
|
$
|
2,524.1
|
|
|
$
|
2,868.9
|
|
|
$
|
2,511.8
|
|
Aftermarket
|
|
897.3
|
|
|
962.1
|
|
|
792.4
|
|
|||
Total sales
|
|
$
|
3,421.4
|
|
|
$
|
3,831.0
|
|
|
$
|
3,304.2
|
|
(1)
|
Sales until the third quarter of 2017 include sales to the Meritor WABCO joint venture, which was acquired in the fourth quarter of 2017 and consolidated from that date.
|
|
|
Year Ended December 31,
|
||||||||||
(Amount in millions)
|
|
2019
|
|
2018
|
|
2017
|
||||||
United States
|
|
$
|
785.1
|
|
|
$
|
830.6
|
|
|
$
|
579.6
|
|
Europe
|
|
1,656.1
|
|
|
1,872.6
|
|
|
1,705.3
|
|
|||
Other (1)
|
|
980.2
|
|
|
1,127.8
|
|
|
1,019.3
|
|
|||
Total sales
|
|
$
|
3,421.4
|
|
|
$
|
3,831.0
|
|
|
$
|
3,304.2
|
|
(1)
|
Sales to other regions includes revenues primarily from Japan, China, Brazil and India.
|
NOTE 5.
|
Accumulated Other Comprehensive Loss
|
|
Year Ended December 31,
|
||||||||||
(Amount in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Foreign currency translation adjustments :
|
|
|
|
|
|
||||||
Balance at beginning of period
|
$
|
(243.0
|
)
|
|
$
|
(177.6
|
)
|
|
$
|
(328.7
|
)
|
Adoption of ASU 2018-02 (Note 3)
|
(7.1
|
)
|
|
—
|
|
|
—
|
|
|||
Comprehensive loss before reclassification, net
|
(7.8
|
)
|
|
(65.4
|
)
|
|
152.9
|
|
|||
Remeasurement of equity investments
|
—
|
|
|
—
|
|
|
(1.8
|
)
|
|||
Balance at end of period (1)
|
(257.9
|
)
|
|
(243.0
|
)
|
|
(177.6
|
)
|
|||
|
|
|
|
|
|
||||||
Loss on intra-entity transactions :
|
|
|
|
|
|
||||||
Balance at beginning of period
|
(11.9
|
)
|
|
(11.8
|
)
|
|
(11.4
|
)
|
|||
Comprehensive (loss)/income before reclassification, net
|
(0.2
|
)
|
|
(0.1
|
)
|
|
(0.4
|
)
|
|||
Balance at end of period (2)
|
(12.1
|
)
|
|
(11.9
|
)
|
|
(11.8
|
)
|
|||
|
|
|
|
|
|
||||||
Unrealized gains on investments:
|
|
|
|
|
|
||||||
Balance at beginning of period
|
—
|
|
|
0.1
|
|
|
0.2
|
|
|||
Adjustments for the period
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|||
Balance at end of period
|
—
|
|
|
—
|
|
|
0.1
|
|
|||
|
|
|
|
|
|
||||||
Unrealized losses on hedges:
|
|
|
|
|
|
||||||
Balance at beginning of period
|
—
|
|
|
(0.8
|
)
|
|
(1.0
|
)
|
|||
Comprehensive income before reclassification, net
|
—
|
|
|
—
|
|
|
0.2
|
|
|||
Amounts reclassified to earnings, net
|
—
|
|
|
0.8
|
|
|
—
|
|
|||
Balance at end of period
|
—
|
|
|
—
|
|
|
(0.8
|
)
|
|||
|
|
|
|
|
|
||||||
Pension and post-retirement plans:
|
|
|
|
|
|
||||||
Balance at beginning of period
|
(269.1
|
)
|
|
(274.4
|
)
|
|
(236.4
|
)
|
|||
Adoption of ASU 2018-02 (Note 3)
|
(1.3
|
)
|
|
—
|
|
|
—
|
|
|||
Comprehensive loss before reclassification, net
|
(66.5
|
)
|
|
(12.2
|
)
|
|
(56.2
|
)
|
|||
Amounts reclassified to earnings, net (3)
|
18.2
|
|
|
17.5
|
|
|
18.2
|
|
|||
Balance at end of period
|
(318.7
|
)
|
|
(269.1
|
)
|
|
(274.4
|
)
|
|||
|
|
|
|
|
|
||||||
Accumulated other comprehensive loss at end of period
|
$
|
(588.7
|
)
|
|
$
|
(524.0
|
)
|
|
$
|
(464.5
|
)
|
(1)
|
Includes an accumulated loss of $9.0 million, net of taxes of $1.0 million as of December 31, 2019 and an accumulated loss of $10.8 million, net of taxes of $10.7 million, as of December 31, 2018 related to foreign currency gains and losses on Euro-denominated debt and foreign currency contracts designated and qualifying as partial hedges of a net investment. This includes the one-time adjustment of currency translation related to the adoption of ASU 2018-02 of $7.1 million disclosed above.
|
(2)
|
Relates to intra-entity foreign currency transactions that are of a long term investment nature, when the entities to the transaction are consolidated, combined or accounted for by the equity method in the Company's financial statements.
|
(3)
|
Consists of amortization of prior service cost and actuarial losses that are included as a component of pension expenses within other non-operating expenses. The amounts reclassified to earnings are recorded net of tax of $7.2 million, $7.0 million and $7.9 million for the years ended December 31, 2019, 2018 and 2017, respectively. See Note 15 for further discussion.
|
NOTE 6.
|
Streamlining
|
|
Year Ended December 31,
|
||||||
(Amounts in millions)
|
2019
|
|
2018
|
||||
Balance at beginning of period
|
$
|
26.4
|
|
|
$
|
43.7
|
|
Charges
|
27.7
|
|
|
14.0
|
|
||
Payments
|
(21.0
|
)
|
|
(30.3
|
)
|
||
Foreign exchange effects
|
(0.3
|
)
|
|
(1.0
|
)
|
||
Balance at end of period
|
$
|
32.8
|
|
|
$
|
26.4
|
|
Current liabilities, included in other accrued liabilities
|
$
|
14.7
|
|
|
$
|
14.8
|
|
Non-current liabilities, included in other liabilities
|
$
|
18.1
|
|
|
$
|
11.6
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Employee-related charges – cost of sales
|
$
|
19.6
|
|
|
$
|
3.2
|
|
|
$
|
7.1
|
|
Employee-related charges – selling and administrative
|
8.1
|
|
|
7.5
|
|
|
4.5
|
|
|||
Other streamlining charges
|
—
|
|
|
3.3
|
|
|
0.4
|
|
|||
Total streamlining costs
|
$
|
27.7
|
|
|
$
|
14.0
|
|
|
$
|
12.0
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Headcount reduction
|
$
|
26.5
|
|
|
$
|
8.7
|
|
|
$
|
5.9
|
|
Site closures and footprint relocation
|
1.2
|
|
|
5.3
|
|
|
6.1
|
|
|||
Total streamlining costs
|
$
|
27.7
|
|
|
$
|
14.0
|
|
|
$
|
12.0
|
|
NOTE 7.
|
Capital Stock
|
|
Number of Shares of Common Stock
|
|||||||
|
Issued
|
|
Treasury Stock
|
|
Outstanding
|
|||
Balance, December 31, 2016
|
78,701,273
|
|
|
(24,209,355
|
)
|
|
54,491,918
|
|
Shares issued upon exercise of stock options
|
161,687
|
|
|
28,840
|
|
|
190,527
|
|
Shares issued upon vesting of RSUs
|
44,419
|
|
|
3,998
|
|
|
48,417
|
|
Shares issued upon vesting of PSUs
|
24,525
|
|
|
7,175
|
|
|
31,700
|
|
Shares issued for DSUs
|
5,924
|
|
|
—
|
|
|
5,924
|
|
Shares purchased for treasury
|
—
|
|
|
(1,033,000
|
)
|
|
(1,033,000
|
)
|
Balance, December 31, 2017
|
78,937,828
|
|
|
(25,202,342
|
)
|
|
53,735,486
|
|
Shares issued upon exercise of stock options
|
14,964
|
|
|
12,999
|
|
|
27,963
|
|
Shares issued upon vesting of RSUs
|
36,126
|
|
|
8,447
|
|
|
44,573
|
|
Shares issued upon vesting of PSUs
|
21,515
|
|
|
6,009
|
|
|
27,524
|
|
Shares issued for DSUs
|
7,833
|
|
|
—
|
|
|
7,833
|
|
Shares purchased for treasury
|
—
|
|
|
(2,478,454
|
)
|
|
(2,478,454
|
)
|
Balance, December 31, 2018
|
79,018,266
|
|
|
(27,653,341
|
)
|
|
51,364,925
|
|
Shares issued upon exercise of stock options
|
13,304
|
|
|
27,481
|
|
|
40,785
|
|
Shares issued upon vesting of RSUs
|
43,007
|
|
|
6,226
|
|
|
49,233
|
|
Shares issued for deferred compensation
|
9,730
|
|
|
—
|
|
|
9,730
|
|
Shares issued upon vesting of PSUs
|
56,521
|
|
|
11,823
|
|
|
68,344
|
|
Shares issued for DSUs
|
6,307
|
|
|
—
|
|
|
6,307
|
|
Shares purchased for treasury
|
—
|
|
|
(272,000
|
)
|
|
(272,000
|
)
|
Balance, December 31, 2019
|
79,147,135
|
|
|
(27,879,811
|
)
|
|
51,267,324
|
|
NOTE 8.
|
Stock-Based Compensation
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Stock-based compensation
|
$
|
9.2
|
|
|
$
|
20.0
|
|
|
$
|
16.4
|
|
|
Underlying Shares
|
|
Weighted - Average Exercise Price
|
|||||||||
|
WABCO employees
|
|
Trane employees
|
|
Total
|
|
||||||
Options Outstanding December 31, 2016
|
246,566
|
|
|
40,965
|
|
|
287,531
|
|
|
$
|
45.07
|
|
Options Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Options Exercised
|
(152,419
|
)
|
|
(40,882
|
)
|
|
(193,301
|
)
|
|
$
|
50.90
|
|
Options Forfeited
|
(394
|
)
|
|
(83
|
)
|
|
(477
|
)
|
|
$
|
44.15
|
|
Options Outstanding December 31, 2017
|
93,753
|
|
|
—
|
|
|
93,753
|
|
|
$
|
33.04
|
|
Options Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Options Exercised
|
(29,081
|
)
|
|
—
|
|
|
(29,081
|
)
|
|
$
|
25.50
|
|
Options Forfeited
|
(1,080
|
)
|
|
—
|
|
|
(1,080
|
)
|
|
$
|
58.85
|
|
Options Outstanding December 31, 2018
|
63,592
|
|
|
—
|
|
|
63,592
|
|
|
$
|
36.05
|
|
Options Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Options Exercised
|
(44,863
|
)
|
|
—
|
|
|
(44,863
|
)
|
|
$
|
27.94
|
|
Options Forfeited
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Options Outstanding December 31, 2019
|
18,729
|
|
|
—
|
|
|
18,729
|
|
|
$
|
55.49
|
|
|
|
|
|
|
|
|
|
|||||
Exercisable at December 31, 2019
|
18,729
|
|
|
—
|
|
|
18,729
|
|
|
$
|
55.49
|
|
|
Underlying Shares
|
|
Weighted - Average Grant Date Fair Value
|
|||
RSUs Outstanding December 31, 2016
|
160,310
|
|
|
$
|
101.27
|
|
RSUs Granted
|
81,116
|
|
|
$
|
118.72
|
|
RSUs Vested
|
(75,887
|
)
|
|
$
|
102.67
|
|
RSUs Forfeited
|
(13,358
|
)
|
|
$
|
106.32
|
|
RSUs Outstanding December 31, 2017
|
152,181
|
|
|
$
|
109.43
|
|
RSUs Granted
|
68,908
|
|
|
$
|
137.04
|
|
RSUs Vested
|
(66,979
|
)
|
|
$
|
107.40
|
|
RSUs Forfeited
|
(7,892
|
)
|
|
$
|
120.99
|
|
RSUs Outstanding December 31, 2018
|
146,218
|
|
|
$
|
122.74
|
|
RSUs Granted
|
67,224
|
|
|
$
|
117.54
|
|
RSUs Vested
|
(67,522
|
)
|
|
$
|
112.23
|
|
RSUs Forfeited
|
(17,003
|
)
|
|
$
|
118.71
|
|
RSUs Outstanding December 31, 2019
|
128,917
|
|
|
$
|
126.07
|
|
|
Underlying Shares
|
|
Weighted - Average Grant Date Fair Value
|
|||
PSUs Outstanding December 31, 2016
|
175,690
|
|
|
$
|
101.31
|
|
PSUs Granted
|
72,163
|
|
|
$
|
115.85
|
|
PSUs Vested
|
(48,357
|
)
|
|
$
|
103.41
|
|
PSUs Forfeited
|
(25,589
|
)
|
|
$
|
103.14
|
|
PSUs Outstanding December 31, 2017
|
173,907
|
|
|
$
|
106.48
|
|
PSUs Granted
|
57,110
|
|
|
$
|
139.93
|
|
PSUs Vested
|
(41,436
|
)
|
|
$
|
115.88
|
|
PSUs Forfeited
|
(9,766
|
)
|
|
$
|
110.74
|
|
PSUs Outstanding December 31, 2018
|
179,815
|
|
|
$
|
114.70
|
|
PSUs Granted
|
95,496
|
|
|
$
|
109.76
|
|
PSUs Vested
|
(92,339
|
)
|
|
$
|
91.35
|
|
PSUs Forfeited
|
(16,301
|
)
|
|
$
|
111.76
|
|
PSUs Outstanding December 31, 2019
|
166,671
|
|
|
$
|
123.91
|
|
|
Underlying Shares
|
|
Weighted - Average Grant Date Fair Value
|
|||
DSUs Outstanding December 31, 2016
|
17,083
|
|
|
$
|
95.93
|
|
DSUs Granted
|
7,752
|
|
|
$
|
118.75
|
|
DSUs Issued
|
(5,924
|
)
|
|
$
|
105.51
|
|
DSUs Outstanding December 31, 2017
|
18,911
|
|
|
$
|
102.28
|
|
DSUs Granted
|
7,208
|
|
|
$
|
127.77
|
|
DSUs Issued
|
(7,833
|
)
|
|
$
|
109.85
|
|
DSUs Outstanding December 31, 2018
|
18,286
|
|
|
$
|
109.09
|
|
DSUs Granted
|
6,174
|
|
|
$
|
130.50
|
|
DSUs Issued
|
(6,307
|
)
|
|
$
|
127.77
|
|
DSUs Outstanding December 31, 2019
|
18,153
|
|
|
$
|
109.88
|
|
|
Vesting Schedule
|
|
|
||||
|
Equal installments over 3 years
|
After 3 years
|
|
Total
|
|||
RSUs granted in 2017
|
69,253
|
|
11,863
|
|
|
81,116
|
|
RSUs granted in 2018
|
65,190
|
|
3,718
|
|
|
68,908
|
|
RSUs granted in 2019
|
67,224
|
|
—
|
|
|
67,224
|
|
NOTE 9.
|
Other Operating and Non-Operating (Income) / Expense, Net
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Other operating (income)/expense, net
|
|
|
|
|
|
||||||
Indemnification costs
|
$
|
—
|
|
|
$
|
0.7
|
|
|
$
|
16.1
|
|
Bank charges
|
1.2
|
|
|
1.3
|
|
|
1.1
|
|
|||
Miscellaneous taxes
|
4.8
|
|
|
5.0
|
|
|
6.1
|
|
|||
Release of contingent consideration
|
—
|
|
|
(3.1
|
)
|
|
—
|
|
|||
Government subsidy
|
(2.6
|
)
|
|
(2.8
|
)
|
|
(1.6
|
)
|
|||
Environmental reserve reduction
|
(3.8
|
)
|
|
—
|
|
|
—
|
|
|||
Other income, net
|
(1.1
|
)
|
|
(1.5
|
)
|
|
(1.1
|
)
|
|||
|
$
|
(1.5
|
)
|
|
$
|
(0.4
|
)
|
|
$
|
20.6
|
|
|
|
|
|
|
|
||||||
Other non-operating expense/(income), net
|
|
|
|
|
|
||||||
Pension and post-retirement benefit costs
|
$
|
37.5
|
|
|
$
|
36.1
|
|
|
$
|
36.0
|
|
Guaranteed notes receivable discount fees
|
1.7
|
|
|
2.2
|
|
|
2.3
|
|
|||
Foreign exchange gains, net
|
(4.2
|
)
|
|
(1.8
|
)
|
|
(1.2
|
)
|
|||
Change in fair value of non-marketable equity securities
|
(2.2
|
)
|
|
5.5
|
|
|
—
|
|
|||
Loss on debt extinguishment
|
—
|
|
|
2.6
|
|
|
—
|
|
|||
Gains on marketable investments
|
(6.1
|
)
|
|
(2.6
|
)
|
|
—
|
|
|||
Other (income)/expense, net
|
(0.5
|
)
|
|
0.3
|
|
|
0.1
|
|
|||
|
$
|
26.2
|
|
|
$
|
42.3
|
|
|
$
|
37.2
|
|
|
Year Ended December 31,
|
||||||||
(Amounts in millions)
|
2019
|
|
2018
|
||||||
Finished products
|
$
|
153.9
|
|
|
$
|
185.2
|
|
||
Products in process
|
11.9
|
|
|
15.3
|
|
||||
Raw materials
|
143.1
|
|
|
137.1
|
|
||||
Inventories, gross
|
308.9
|
|
|
337.6
|
|
||||
Less: inventory reserve
|
16.0
|
|
|
18.5
|
|
||||
Inventories, net
|
$
|
292.9
|
|
|
$
|
319.1
|
|
|
Year Ended December 31,
|
||||||
(Amounts in millions)
|
2019
|
|
2018
|
||||
Land
|
$
|
29.1
|
|
|
$
|
26.8
|
|
Buildings
|
215.9
|
|
|
222.9
|
|
||
Machinery and equipment
|
1,125.8
|
|
|
1,088.4
|
|
||
Improvements in progress
|
35.1
|
|
|
38.7
|
|
||
Gross property, plant and equipment
|
1,405.9
|
|
|
1,376.8
|
|
||
Less: accumulated depreciation
|
812.9
|
|
|
823.2
|
|
||
Property, plant and equipment, net
|
$
|
593.0
|
|
|
$
|
553.6
|
|
|
Year Ended
December 31, |
||
(Amounts in millions)
|
2019
|
||
Operating Lease Expense
|
|
||
Cash paid for amounts included in the measurement of lease liabilities
|
$
|
31.2
|
|
ROU assets obtained in exchange for new lease liabilities
|
$
|
20.1
|
|
|
|
||
Weighted-average remaining lease term (in years)
|
6.2
|
|
|
Weighted-average discount rate
|
1.4
|
%
|
(Amounts in millions)
|
|
||
2020
|
$
|
29.4
|
|
2021
|
19.9
|
|
|
2022
|
15.6
|
|
|
2023
|
11.9
|
|
|
2024
|
6.1
|
|
|
Thereafter
|
25.2
|
|
|
Total lease payments
|
108.1
|
|
|
Less: imputed interest
|
5.8
|
|
|
Total
|
$
|
102.3
|
|
|
|
||
Amounts recognized in the consolidated balance sheet:
|
|
||
Current liabilities, included in other accrued liabilities
|
$
|
28.1
|
|
Long-term liabilities, as operating lease liabilities
|
$
|
74.2
|
|
|
Year Ended December 31,
|
||||||
(Amounts in millions)
|
2019
|
|
2018
|
||||
Balance of goodwill, beginning of year
|
$
|
809.4
|
|
|
$
|
834.7
|
|
Acquisitions
|
—
|
|
|
(3.2
|
)
|
||
Foreign exchange translation
|
(6.9
|
)
|
|
(22.1
|
)
|
||
Balance of goodwill, end of year
|
$
|
802.5
|
|
|
$
|
809.4
|
|
|
Year ended December 31,
|
||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||
(Amounts in millions)
|
Gross carrying amount
|
Accumulated amortization
|
Net Book Value
|
|
Gross carrying amount
|
Accumulated amortization
|
Net Book Value
|
||||||||||||
Capitalized software
|
$
|
125.7
|
|
$
|
(100.3
|
)
|
$
|
25.4
|
|
|
$
|
120.5
|
|
$
|
(92.0
|
)
|
$
|
28.5
|
|
Customer relationships
|
161.8
|
(49.2
|
)
|
112.6
|
|
161.9
|
(38.0
|
)
|
123.9
|
||||||||||
Trade names
|
81.1
|
(6.9
|
)
|
74.2
|
|
81.2
|
(4.8
|
)
|
76.4
|
||||||||||
Other intangible assets
|
55.8
|
(41.1
|
)
|
14.7
|
|
58.7
|
(40.9
|
)
|
17.8
|
||||||||||
Intangible assets, net
|
$
|
424.4
|
|
$
|
(197.5
|
)
|
$
|
226.9
|
|
|
$
|
422.3
|
|
$
|
(175.7
|
)
|
$
|
246.6
|
|
|
Year Ended December 31,
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
(Amounts in millions)
|
Health & Life Ins. Benefits
|
|
Pension Benefits
|
|
Health & Life Ins. Benefits
|
|
Pension Benefits
|
||||||||
Reconciliation of benefit obligation:
|
|
|
|
|
|
|
|
||||||||
Obligation at beginning of year
|
$
|
11.8
|
|
|
$
|
889.6
|
|
|
$
|
12.4
|
|
|
$
|
889.7
|
|
Service cost
|
0.7
|
|
|
26.5
|
|
|
0.8
|
|
|
25.3
|
|
||||
Interest cost
|
0.5
|
|
|
16.4
|
|
|
0.5
|
|
|
16.4
|
|
||||
Participant contributions
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.4
|
|
||||
Settlements
|
—
|
|
|
(3.2
|
)
|
|
—
|
|
|
—
|
|
||||
Actuarial (gain)/loss (1)
|
(7.7
|
)
|
|
112.2
|
|
|
(0.7
|
)
|
|
24.4
|
|
||||
Plan amendments (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
3.6
|
|
||||
Benefit payments
|
(0.8
|
)
|
|
(27.8
|
)
|
|
(1.1
|
)
|
|
(28.6
|
)
|
||||
Foreign exchange effects
|
—
|
|
|
(9.4
|
)
|
|
(0.1
|
)
|
|
(40.1
|
)
|
||||
Other
|
(0.1
|
)
|
|
1.7
|
|
|
—
|
|
|
(1.5
|
)
|
||||
Obligation at end of year
|
$
|
4.4
|
|
|
$
|
1,006.3
|
|
|
$
|
11.8
|
|
|
$
|
889.6
|
|
(1)
|
For the year ended December 31, 2019, the actuarial gains for health and life insurance benefits were primarily due to a decrease in the number of eligible plan participants, while the actuarial losses for pension benefits were primarily due to decreases in discount rates across all pension plans.
|
(2)
|
Plan amendments relate to the UK court ruling in 2018 relating to the Guaranteed Minimum Pension (GMP) equalization.
|
|
Year Ended December 31,
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
(Amounts in millions)
|
Health & Life Ins. Benefits
|
|
Pension Benefits
|
|
Health & Life Ins. Benefits
|
|
Pension Benefits
|
||||||||
Reconciliation of fair value of plan assets:
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets at beginning of year
|
$
|
—
|
|
|
$
|
164.7
|
|
|
$
|
—
|
|
|
$
|
180.4
|
|
Actual gain/(loss) on assets
|
—
|
|
|
7.4
|
|
|
—
|
|
|
(2.2
|
)
|
||||
Employer contributions
|
0.8
|
|
|
23.1
|
|
|
1.1
|
|
|
24.8
|
|
||||
Participant contributions
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.4
|
|
||||
Settlements
|
—
|
|
|
(3.1
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
||
Benefit payments
|
(0.8
|
)
|
|
(27.8
|
)
|
|
(1.1
|
)
|
|
(28.4
|
)
|
||||
Foreign exchange effects
|
—
|
|
|
4.4
|
|
|
—
|
|
|
(8.6
|
)
|
||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.7
|
)
|
||||
Fair value of plan assets at end of year
|
$
|
—
|
|
|
$
|
169.0
|
|
|
$
|
—
|
|
|
$
|
164.7
|
|
Funded status at December 31
|
$
|
(4.4
|
)
|
|
$
|
(837.3
|
)
|
|
$
|
(11.8
|
)
|
|
$
|
(724.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Amounts recognized in the balance sheet:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Noncurrent assets (included in other assets)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Current liabilities (included in accrued payroll)
|
(0.5
|
)
|
|
(19.4
|
)
|
|
(0.9
|
)
|
|
(19.5
|
)
|
||||
Noncurrent liabilities
|
(3.9
|
)
|
|
(817.9
|
)
|
|
(10.9
|
)
|
|
(705.4
|
)
|
||||
Net amounts recognized in balance sheet:
|
$
|
(4.4
|
)
|
|
$
|
(837.3
|
)
|
|
$
|
(11.8
|
)
|
|
$
|
(724.9
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cumulative amounts recognized in other comprehensive income consist of:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Prior service cost
|
$
|
—
|
|
|
$
|
4.0
|
|
|
$
|
—
|
|
|
$
|
4.4
|
|
Net actuarial loss
|
0.1
|
|
|
450.8
|
|
|
8.3
|
|
|
369.4
|
|
||||
Total (before tax effects)
|
$
|
0.1
|
|
|
$
|
454.8
|
|
|
$
|
8.3
|
|
|
$
|
373.8
|
|
|
Year Ended December 31,
|
||||||
(Amounts in millions)
|
2019
|
|
2018
|
||||
For plans with projected benefit obligations in excess of plan assets:
|
|
|
|
||||
Projected benefit obligation
|
$
|
949.3
|
|
|
$
|
826.1
|
|
Fair value of plan assets
|
111.9
|
|
|
101.3
|
|
||
For plans with accumulated benefit obligations in excess of plan assets:
|
|
|
|
||||
Accumulated benefit obligation
|
$
|
720.2
|
|
|
$
|
635.2
|
|
Fair value of plan assets
|
35.0
|
|
|
35.6
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Foreign pensions
|
$
|
62.9
|
|
|
$
|
60.4
|
|
|
$
|
55.8
|
|
Health & Life insurance benefits
|
1.8
|
|
|
1.8
|
|
|
1.7
|
|
|||
Total pension and post-retirement benefit costs
|
$
|
64.7
|
|
|
$
|
62.2
|
|
|
$
|
57.5
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Service cost - benefits earned during period
|
$
|
26.5
|
|
|
$
|
25.3
|
|
|
$
|
20.8
|
|
Interest cost on projected benefit obligation
|
16.4
|
|
|
16.4
|
|
|
14.5
|
|
|||
Less: assumed return on plan assets
|
(4.8
|
)
|
|
(5.4
|
)
|
|
(5.2
|
)
|
|||
Amortization of prior service cost
|
0.5
|
|
|
0.1
|
|
|
0.1
|
|
|||
Amortization of net loss
|
23.7
|
|
|
24.7
|
|
|
26.1
|
|
|||
Settlement
|
0.6
|
|
|
—
|
|
|
—
|
|
|||
Gain on curtailment
|
—
|
|
|
(0.7
|
)
|
|
(0.5
|
)
|
|||
Pension benefit costs
|
$
|
62.9
|
|
|
$
|
60.4
|
|
|
$
|
55.8
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Service cost - benefits earned during period
|
$
|
0.7
|
|
|
$
|
0.8
|
|
|
$
|
0.7
|
|
Interest cost on projected benefit obligation
|
0.5
|
|
|
0.5
|
|
|
0.5
|
|
|||
Amortization of net loss
|
0.6
|
|
|
0.5
|
|
|
0.5
|
|
|||
Other post-retirement benefit costs
|
$
|
1.8
|
|
|
$
|
1.8
|
|
|
$
|
1.7
|
|
Benefit Obligation at December 31
|
2019 Health & Life Ins. Benefits
|
|
2019 Foreign Pension Plans
|
|
2018 Health & Life Ins. Benefits
|
|
2018 Foreign Pension Plans
|
||||
Discount rate
|
2.95
|
%
|
|
1.21
|
%
|
|
4.30
|
%
|
|
1.90
|
%
|
Salary growth
|
N/A
|
|
|
3.66
|
%
|
|
N/A
|
|
|
3.71
|
%
|
Net Periodic Pension Cost for the year
|
|
|
|
|
|
|
|
||||
Discount rate
|
4.30
|
%
|
|
1.90
|
%
|
|
3.55
|
%
|
|
1.87
|
%
|
Salary growth
|
N/A
|
|
|
3.71
|
%
|
|
N/A
|
|
|
2.85
|
%
|
Expected return on plan assets
|
N/A
|
|
|
2.93
|
%
|
|
N/A
|
|
|
2.40
|
%
|
Asset Allocation
|
2019
|
|
2018
|
|
2019 Target
|
|
2018 Target
|
||||
Debt securities (issued by non-U.S. government agencies)
|
6
|
%
|
|
6
|
%
|
|
16
|
%
|
|
12
|
%
|
Mutual funds
|
37
|
%
|
|
32
|
%
|
|
23
|
%
|
|
27
|
%
|
Insurance contracts
|
41
|
%
|
|
47
|
%
|
|
46
|
%
|
|
47
|
%
|
Investments in collective foundations
|
15
|
%
|
|
14
|
%
|
|
15
|
%
|
|
14
|
%
|
Cash
|
1
|
%
|
|
1
|
%
|
|
—
|
%
|
|
—
|
%
|
|
December 31, 2019
|
|
Fair Value Hierarchy
|
||||||||||||
(Amounts in millions)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||
Debt securities (issued by non-U.S. government agencies)
|
$
|
10.5
|
|
|
10.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Mutual funds
|
62.9
|
|
|
—
|
|
|
62.9
|
|
|
—
|
|
||||
Insurance contracts
|
69.9
|
|
|
—
|
|
|
—
|
|
|
69.9
|
|
||||
Investments in collective foundations
|
24.7
|
|
|
—
|
|
|
—
|
|
|
24.7
|
|
||||
Cash
|
1.0
|
|
|
1.0
|
|
|
—
|
|
|
—
|
|
||||
Total plan assets
|
$
|
169.0
|
|
|
$
|
11.5
|
|
|
$
|
62.9
|
|
|
$
|
94.6
|
|
|
December 31, 2018
|
|
Fair Value Hierarchy
|
||||||||||||
(Amounts in millions)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||
Debt securities (issued by non-U.S. government agencies)
|
$
|
8.9
|
|
|
8.9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Mutual funds
|
53.4
|
|
|
—
|
|
|
53.4
|
|
|
—
|
|
||||
Insurance contracts
|
77.3
|
|
|
—
|
|
|
—
|
|
|
77.3
|
|
||||
Investments in collective foundations
|
23.8
|
|
|
—
|
|
|
—
|
|
|
23.8
|
|
||||
Cash
|
1.3
|
|
|
1.3
|
|
|
—
|
|
|
—
|
|
||||
Total plan assets
|
$
|
164.7
|
|
|
$
|
10.2
|
|
|
$
|
53.4
|
|
|
$
|
101.1
|
|
|
Year Ended December 31,
|
||||||
(Amounts in millions)
|
2019
|
|
2018
|
||||
Beginning balance
|
$
|
101.1
|
|
|
$
|
111.5
|
|
Actual loss on assets
|
(1.6
|
)
|
|
(0.4
|
)
|
||
Contributions to assets
|
3.5
|
|
|
3.4
|
|
||
Benefit payments from assets
|
(7.8
|
)
|
|
(7.4
|
)
|
||
Transfers
|
(2.9
|
)
|
|
(1.2
|
)
|
||
Foreign exchange effects
|
2.3
|
|
|
(4.8
|
)
|
||
Ending balance
|
$
|
94.6
|
|
|
$
|
101.1
|
|
(Amounts in millions)
|
2020
|
2021
|
2022
|
2023
|
2024
|
2025-2029
|
||||||||||||
Domestic plans without subsidy
|
$
|
0.5
|
|
$
|
0.5
|
|
$
|
0.5
|
|
$
|
0.4
|
|
$
|
0.4
|
|
$
|
1.4
|
|
Foreign pension plans
|
27.2
|
|
27.7
|
|
27.8
|
|
28.9
|
|
29.9
|
|
154.8
|
|
(Amounts in millions)
|
1% Increase
|
1% Decrease
|
||||
Effect on the health care component of accumulated post-retirement obligation
|
$
|
0.3
|
|
$
|
(0.3
|
)
|
Effect on total of service and interest cost components of net periodic post-retirement health care benefit costs
|
N/A
|
|
N/A
|
|
(Amounts in millions)
|
Face value
|
|
Coupon
|
Maturity date
|
||
Fixed rate term loan - Series A
|
€
|
10.0
|
|
|
0.85%
|
March 31, 2021
|
Fixed rate term loan - Series B
|
60.0
|
|
|
1.15%
|
March 31, 2022
|
|
Fixed rate term loan - Series C
|
80.0
|
|
|
1.43%
|
March 31, 2023
|
|
Floating rate term loan - Series A
|
50.0
|
|
|
6-month EURIBOR plus 80 bps
|
March 31, 2021
|
|
Floating rate term loan - Series B
|
60.0
|
|
|
6-month EURIBOR plus 90 bps
|
March 31, 2022
|
|
Floating rate term loan - Series C
|
40.0
|
|
|
6-month EURIBOR plus 100 bps
|
March 31, 2023
|
|
|
€
|
300.0
|
|
|
|
|
(Amounts in EUR millions)
|
Face value
|
|
Coupon
|
|
Maturity Date
|
|||
Series D Notes
|
€
|
190.0
|
|
|
0.84
|
%
|
|
November 15, 2023
|
Series E Notes
|
80.0
|
|
|
1.20
|
%
|
|
November 15, 2026
|
|
Series F Notes
|
170.0
|
|
|
1.36
|
%
|
|
November 15, 2028
|
|
|
€
|
440.0
|
|
|
|
|
|
(Amounts in millions)
|
Face value
|
|
Coupon
|
|
Maturity Date
|
|||
Series A Notes
|
$
|
150.0
|
|
|
2.83
|
%
|
|
June 25, 2022
|
Series B Notes
|
200.0
|
|
|
3.08
|
%
|
|
June 25, 2025
|
|
Series C Notes
|
150.0
|
|
|
3.18
|
%
|
|
June 25, 2027
|
|
|
$
|
500.0
|
|
|
|
|
|
(Amounts in millions)
|
|
||
2020
|
$
|
—
|
|
2021
|
67.3
|
|
|
2022
|
134.6
|
|
|
2023
|
347.7
|
|
|
2024
|
—
|
|
|
Thereafter
|
280.3
|
|
|
Less: unamortized debt issuance fees
|
(1.6
|
)
|
|
Total long-term debt
|
$
|
828.3
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Balance of warranty costs accrued, beginning of period
|
$
|
43.7
|
|
|
$
|
50.9
|
|
|
$
|
49.3
|
|
Warranty costs accrued
|
35.3
|
|
|
31.3
|
|
|
32.5
|
|
|||
Warranty claims settled
|
(29.7
|
)
|
|
(36.4
|
)
|
|
(36.0
|
)
|
|||
Foreign exchange translation effects
|
(0.7
|
)
|
|
(2.1
|
)
|
|
5.1
|
|
|||
Balance of warranty costs accrued, end of period
|
$
|
48.6
|
|
|
$
|
43.7
|
|
|
$
|
50.9
|
|
Current liability, included in current portion of warranties
|
28.1
|
|
|
23.3
|
|
|
29.5
|
|
|||
Long-term liability, included in other liabilities
|
20.5
|
|
|
20.4
|
|
|
21.4
|
|
|||
|
|
|
|
|
|
||||||
Warranty costs accrued
|
35.3
|
|
|
31.3
|
|
|
32.5
|
|
|||
Less: received and anticipated recoveries from suppliers
|
(0.8
|
)
|
|
(0.5
|
)
|
|
(2.0
|
)
|
|||
Warranty costs net of received and anticipated recoveries
|
$
|
34.5
|
|
|
$
|
30.8
|
|
|
$
|
30.5
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Income before income taxes:
|
|
|
|
|
|
||||||
Domestic
|
$
|
46.1
|
|
|
$
|
36.2
|
|
|
$
|
227.3
|
|
Foreign
|
266.7
|
|
|
427.5
|
|
|
425.3
|
|
|||
|
312.8
|
|
|
463.7
|
|
|
652.6
|
|
|||
Provision/(benefit) for income taxes:
|
|
|
|
|
|
|
|
||||
Current:
|
|
|
|
|
|
|
|
|
|||
Domestic
|
4.3
|
|
|
1.5
|
|
|
(9.8
|
)
|
|||
Domestic Transition Tax
|
—
|
|
|
5.9
|
|
|
196.4
|
|
|||
Foreign
|
68.5
|
|
|
65.5
|
|
|
91.3
|
|
|||
|
72.8
|
|
|
72.9
|
|
|
277.9
|
|
|||
Deferred:
|
|
|
|
|
|
|
|
|
|||
Domestic
|
2.9
|
|
|
4.6
|
|
|
(30.0
|
)
|
|||
Foreign
|
(22.3
|
)
|
|
(28.2
|
)
|
|
(18.2
|
)
|
|||
|
(19.4
|
)
|
|
(23.6
|
)
|
|
(48.2
|
)
|
|||
|
|
|
|
|
|
||||||
Total provision
|
$
|
53.4
|
|
|
$
|
49.3
|
|
|
$
|
229.7
|
|
•
|
During 2019, we recorded a $6.5 million income tax benefit as a result of a change in the permanent reinvestment assertion for WABCO INDIA, reducing the ETR by 2.1%;
|
•
|
During 2019, the Company reorganized and eliminated its hybrid financing structure in response to draft Dutch tax legislation. This restructuring resulted in a net $5.0 million income tax benefit as a result of recognizing a tax amortizable step-up in the fair market value of intercompany loans, reducing the ETR by 1.6%.
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Tax provision at statutory rate
|
$
|
65.7
|
|
|
$
|
97.4
|
|
|
$
|
228.3
|
|
State income taxes, net
|
(0.6
|
)
|
|
(2.6
|
)
|
|
8.9
|
|
|||
Foreign earnings taxed at other than statutory rate
|
29.8
|
|
|
33.2
|
|
|
(21.6
|
)
|
|||
Decrease in valuation allowance
|
(0.1
|
)
|
|
(10.6
|
)
|
|
(1.8
|
)
|
|||
Unremitted foreign earnings
|
(6.5
|
)
|
|
—
|
|
|
—
|
|
|||
2013-14 PID claim
|
—
|
|
|
(33.3
|
)
|
|
—
|
|
|||
Patent Income Deduction
|
(21.5
|
)
|
|
(22.9
|
)
|
|
(21.7
|
)
|
|||
High & New Technology Enterprise (HNTE)
|
(6.2
|
)
|
|
(8.7
|
)
|
|
(10.5
|
)
|
|||
Fair market value step-up in assets
|
(5.0
|
)
|
|
—
|
|
|
—
|
|
|||
Hybrid financing structure
|
—
|
|
|
(11.4
|
)
|
|
(11.5
|
)
|
|||
Belgium tax rate change
|
1.7
|
|
|
5.2
|
|
|
13.8
|
|
|||
U.S. tax rate change
|
—
|
|
|
2.0
|
|
|
(32.4
|
)
|
|||
Net U.S. transition tax
|
—
|
|
|
5.8
|
|
|
100.0
|
|
|||
Other, net
|
(3.9
|
)
|
|
(4.8
|
)
|
|
(21.8
|
)
|
|||
Total provision
|
$
|
53.4
|
|
|
$
|
49.3
|
|
|
$
|
229.7
|
|
|
Year Ended December 31,
|
||||||
(Amounts in millions)
|
2019
|
|
2018
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Facilities (accelerated depreciation, capitalized interest and purchase accounting differences)
|
$
|
14.7
|
|
|
$
|
17.6
|
|
Basis difference in subsidiaries
|
60.5
|
|
|
65.0
|
|
||
Intangibles
|
10.0
|
|
|
12.5
|
|
||
|
85.2
|
|
|
95.1
|
|
||
|
|
|
|
||||
Deferred tax assets:
|
|
|
|
||||
Net operating losses and tax credits
|
6.8
|
|
|
8.5
|
|
||
Post-retirement and other employee benefits
|
179.2
|
|
|
149.3
|
|
||
Capitalized assets
|
73.1
|
|
|
69.2
|
|
||
Inventory
|
1.4
|
|
|
1.6
|
|
||
Warranties
|
3.4
|
|
|
2.1
|
|
||
Unrealized foreign exchange losses
|
10.6
|
|
|
10.0
|
|
||
Other
|
16.2
|
|
|
17.5
|
|
||
|
290.7
|
|
|
258.2
|
|
||
|
|
|
|
||||
Valuation allowances
|
(1.7
|
)
|
|
(1.8
|
)
|
||
Net deferred tax assets
|
$
|
203.8
|
|
|
$
|
161.3
|
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Beginning balance, January 1
|
$
|
39.6
|
|
|
$
|
71.6
|
|
|
$
|
69.4
|
|
Additions for tax positions related to current year
|
0.2
|
|
|
—
|
|
|
1.7
|
|
|||
Additions for tax positions related to prior years
|
—
|
|
|
3.4
|
|
|
4.2
|
|
|||
Reductions for tax positions related to prior years
|
(3.0
|
)
|
|
(35.4
|
)
|
|
(3.4
|
)
|
|||
Cash settlements
|
(1.9
|
)
|
|
—
|
|
|
(0.2
|
)
|
|||
Expirations of statute of limitations
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|||
Ending balance, December 31
|
$
|
34.9
|
|
|
$
|
39.6
|
|
|
$
|
71.6
|
|
Entity
|
Description
|
Ownership %
|
WABCOWURTH Workshop Services GmbH (WABCOWURTH)
|
Supplier of diagnostic systems
|
50.0%
|
Sino-American RH Sheppard Hubei Steering Systems LTD (Sheppard Hubei)
|
Provider of steering gear solutions in China
|
50.0%
|
China Source Engineered Components Trading Corporation Ltd (SSCS)
|
Wholesaler of machined parts
|
37.5%
|
Shanghai G7 WABCO IOT Technology Co Ltd (G7)
|
Developer of fleet management solutions
|
50.0%
|
(Amounts in millions)
|
WABCO Sales to
|
|
WABCO Purchases from
|
||||||||||||||||||||
Joint Venture partners
|
2019
|
|
2018
|
|
2017
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||
Sanwa-Seiki
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
20.0
|
|
|
$
|
22.1
|
|
|
$
|
25.6
|
|
Cummins
|
85.1
|
|
|
96.4
|
|
|
83.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
FUWA (1)
|
4.3
|
|
|
9.3
|
|
|
6.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
FAW
|
—
|
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
(1)
|
Reflects only the transactions with FUWA prior to the Company's acquisition of the remaining interest in the joint venture.
|
|
Year Ended December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Product Sales:
|
|
|
|
|
|
||||||
OEM
|
$
|
2,524.1
|
|
|
$
|
2,868.9
|
|
|
$
|
2,511.8
|
|
Aftermarket
|
897.3
|
|
|
962.1
|
|
|
792.4
|
|
|||
Total sales
|
$
|
3,421.4
|
|
|
$
|
3,831.0
|
|
|
$
|
3,304.2
|
|
|
|
|
|
|
|
||||||
Sales - Geographic distribution (a):
|
|
|
|
|
|
||||||
United States
|
$
|
785.1
|
|
|
$
|
830.6
|
|
|
$
|
579.6
|
|
Europe (countries below are included in this total)
|
1,656.1
|
|
|
1,872.6
|
|
|
1,705.3
|
|
|||
Germany
|
569.2
|
|
|
700.9
|
|
|
676.3
|
|
|||
France
|
99.6
|
|
|
110.5
|
|
|
93.5
|
|
|||
Netherlands
|
118.1
|
|
|
132.1
|
|
|
115.2
|
|
|||
Sweden
|
202.0
|
|
|
226.3
|
|
|
214.2
|
|
|||
Other (countries below are included in this total)
|
980.2
|
|
|
1,127.8
|
|
|
1,019.3
|
|
|||
Japan
|
120.4
|
|
|
118.4
|
|
|
115.4
|
|
|||
China
|
343.5
|
|
|
391.0
|
|
|
411.9
|
|
|||
Brazil
|
128.7
|
|
|
115.4
|
|
|
88.9
|
|
|||
India
|
173.1
|
|
|
284.4
|
|
|
231.3
|
|
|||
Total sales
|
$
|
3,421.4
|
|
|
$
|
3,831.0
|
|
|
$
|
3,304.2
|
|
(a)
|
Sales to external customers are classified by country of destination.
|
|
As of December 31,
|
||||||||||
(Amounts in millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Long-lived Assets (b)
|
|
|
|
|
|
||||||
Geographic distribution:
|
|
|
|
|
|
||||||
United States
|
$
|
730.9
|
|
|
$
|
711.9
|
|
|
$
|
715.3
|
|
Europe (countries below are included in this total)
|
788.3
|
|
|
710.3
|
|
|
706.1
|
|
|||
Germany
|
389.7
|
|
|
353.3
|
|
|
315.2
|
|
|||
Poland
|
166.4
|
|
|
152.8
|
|
|
153.6
|
|
|||
Other (countries below are included in this total)
|
317.1
|
|
|
272.4
|
|
|
290.2
|
|
|||
India
|
129.9
|
|
|
113.0
|
|
|
106.6
|
|
|||
China
|
69.0
|
|
|
58.1
|
|
|
56.5
|
|
|||
Total long-lived assets
|
$
|
1,836.3
|
|
|
$
|
1,694.6
|
|
|
$
|
1,711.6
|
|
(b)
|
Amounts are presented on a net basis and exclude deferred tax assets and investments in unconsolidated joint ventures.
|
(Amount in millions)
|
|
|
|
|
|
As of December 31, 2019
|
|
As of December 31, 2018
|
||||||||
Foreign Currency
|
|
Unit of Measure
|
|
Hedged against
|
|
Quantity Hedged
|
|
Notional Amount (USD Equivalent)
|
|
Quantity Hedged
|
|
Notional Amount (USD Equivalent)
|
||||
Chinese Yuan
|
|
CNY
|
|
EUR
|
|
930.0
|
|
|
133.1
|
|
|
849.0
|
|
|
123.4
|
|
Hong Kong Dollar
|
|
HKD
|
|
EUR
|
|
267.0
|
|
|
34.4
|
|
|
285.0
|
|
|
36.4
|
|
Polish Zloty
|
|
PLN
|
|
EUR
|
|
45.0
|
|
|
11.8
|
|
|
*
|
|
|
*
|
|
British Pound
|
|
GBP
|
|
EUR
|
|
*
|
|
|
*
|
|
|
11.7
|
|
|
14.9
|
|
|
As of December 31, 2019
|
||||||||||||||
(Amounts in millions)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Cash equivalents
|
$
|
—
|
|
|
$
|
83.1
|
|
|
$
|
—
|
|
|
$
|
83.1
|
|
Short-term investments
|
—
|
|
|
67.6
|
|
|
—
|
|
|
67.6
|
|
||||
Other investments (included in other assets)
|
—
|
|
|
2.8
|
|
|
—
|
|
|
2.8
|
|
||||
|
|
|
|
|
|
|
|
||||||||
|
As of December 31, 2018
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Cash equivalents
|
$
|
—
|
|
|
$
|
70.8
|
|
|
$
|
—
|
|
|
$
|
70.8
|
|
Short-term investments
|
—
|
|
|
135.8
|
|
|
—
|
|
|
135.8
|
|
||||
Other investments (included in other assets)
|
—
|
|
|
2.8
|
|
|
—
|
|
|
2.8
|
|
|
Year 2019
|
||||||||||||||
(Amounts in millions)
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
Sales
|
$
|
932.9
|
|
|
$
|
912.8
|
|
|
$
|
798.4
|
|
|
$
|
777.4
|
|
Cost of sales
|
660.0
|
|
|
644.0
|
|
|
559.5
|
|
|
565.8
|
|
||||
Gross profit
|
272.9
|
|
|
268.8
|
|
|
238.9
|
|
|
211.6
|
|
||||
Income before income taxes
|
100.0
|
|
|
95.6
|
|
|
76.7
|
|
|
40.6
|
|
||||
Income tax expense/(benefit)
|
12.1
|
|
|
20.9
|
|
|
15.9
|
|
|
4.5
|
|
||||
Net income attributable to Company
|
$
|
84.2
|
|
|
$
|
70.6
|
|
|
$
|
58.0
|
|
|
$
|
33.2
|
|
Net income per common share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.64
|
|
|
$
|
1.38
|
|
|
$
|
1.13
|
|
|
$
|
0.65
|
|
Diluted
|
$
|
1.64
|
|
|
$
|
1.38
|
|
|
$
|
1.13
|
|
|
$
|
0.65
|
|
|
Year 2018
|
||||||||||||||
(Amounts in millions)
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
||||||||
Sales
|
$
|
1,003.3
|
|
|
$
|
1,001.2
|
|
|
$
|
914.8
|
|
|
$
|
911.6
|
|
Cost of sales
|
694.3
|
|
|
690.9
|
|
|
639.7
|
|
|
633.5
|
|
||||
Gross profit
|
309.0
|
|
|
310.3
|
|
|
275.1
|
|
|
278.1
|
|
||||
Income before income taxes
|
133.0
|
|
|
132.8
|
|
|
93.3
|
|
|
104.6
|
|
||||
Income tax expense
|
26.3
|
|
|
23.5
|
|
|
13.5
|
|
|
(14.0
|
)
|
||||
Net income attributable to Company
|
$
|
100.7
|
|
|
$
|
104.4
|
|
|
$
|
74.5
|
|
|
$
|
114.5
|
|
Net income per common share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.87
|
|
|
$
|
1.96
|
|
|
$
|
1.42
|
|
|
$
|
2.21
|
|
Diluted
|
$
|
1.87
|
|
|
$
|
1.95
|
|
|
$
|
1.41
|
|
|
$
|
2.20
|
|
(i)
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company,
|
(ii)
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company, and
|
(iii)
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the consolidated financial statements.
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND, DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
(a)
|
1. and 2. Financial statements and financial statement schedules
|
|
|
Page No.
|
|
|
|
1
|
Financial Statements:
|
|
|
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
|
|
|
|
Consolidated Statements of Operations for years ended December 31, 2019, 2018 and 2017
|
|
|
|
|
|
Consolidated Statements of Comprehensive Income for years ended December 31, 2019, 2018 and 2017
|
|
|
|
|
|
Consolidated Balance Sheets at December 31, 2019 and 2018
|
|
|
|
|
|
Consolidated Statements of Cash Flows for years ended December 31, 2019, 2018 and 2017
|
|
|
|
|
|
Consolidated Statements of Shareholders' Equity for years ended December 31, 2019, 2018 and 2017
|
|
|
|
|
|
Notes to Financial Statements
|
|
|
|
|
2
|
Financial statement schedule, years ended December 31, 2019, 2018 and 2017
|
|
|
|
|
|
Schedule II - Valuation and Qualifying Accounts
|
Description
|
|
Balance
Beginning
of Period
|
|
Additions Charged to Expense
|
|
Deductions
|
|
Foreign
Currency
Translation
Effects
|
|
Balance
End of
Period
|
|||||
2019:
|
|
|
|
|
|
|
|
|
|
|
|||||
Reserve deducted from assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for doubtful accounts receivable
|
|
10,735
|
|
|
2,314
|
|
|
(557
|
)
|
|
(197
|
)
|
|
12,295
|
|
2018:
|
|
|
|
|
|
|
|
|
|
|
|||||
Reserve deducted from assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for doubtful accounts receivable
|
|
9,358
|
|
|
2,205
|
|
|
(390
|
)
|
|
(438
|
)
|
|
10,735
|
|
2017:
|
|
|
|
|
|
|
|
|
|
|
|||||
Reserve deducted from assets:
|
|
|
|
|
|
|
|
|
|
|
|||||
Allowance for doubtful accounts receivable
|
|
6,479
|
|
|
2,460
|
|
|
(445
|
)
|
|
864
|
|
|
9,358
|
|
Exhibit No.
|
Description
|
2.1
|
|
|
|
2.2
|
|
|
|
3.1
|
|
|
|
3.2
|
|
|
|
4.1
|
|
|
|
4.2
|
|
|
|
4.3
|
|
|
|
10.1
|
|
|
|
10.2
|
|
|
|
10.3
|
|
|
|
10.4
|
|
|
|
10.5
|
|
|
|
10.6
|
|
|
|
10.7
|
|
|
|
10.8
|
|
|
|
10.9
|
|
|
|
10.10
|
|
|
|
10.11
|
|
|
|
10.12
|
|
|
|
10.13
|
|
|
|
10.14
|
|
|
|
10.15
|
|
|
|
10.16
|
|
|
|
10.17
|
|
|
|
10.18
|
|
|
|
10.19
|
|
|
|
10.20
|
|
|
|
10.10
|
|
|
|
10.22
|
|
|
|
10.23
|
|
|
10.24
|
|
|
|
10.25
|
|
|
|
10.26
|
|
|
|
10.27
|
|
|
|
10.28
|
|
|
|
10.29
|
|
|
|
10.30
|
|
|
|
10.31
|
|
|
|
10.32
|
|
|
|
10.33
|
|
|
|
10.34
|
|
|
|
10.35
|
|
|
|
10.36
|
|
|
|
10.37
|
|
|
|
10.38
|
|
|
|
10.39
|
|
|
|
10.40
|
|
|
|
10.41
|
|
|
|
10.42
|
|
|
|
10.43
|
|
|
|
10.44
|
|
|
|
10.45
|
|
|
|
10.46
|
|
|
|
10.47
|
|
|
|
10.48
|
|
|
|
10.49
|
|
|
|
10.50
|
|
|
|
21.1
|
|
|
|
23.1
|
|
|
|
24.1
|
|
|
|
31.1
|
|
|
|
31.2
|
|
|
|
32.1
|
|
|
|
32.2
|
|
|
|
101
|
The following financial information from WABCO Holdings Inc.'s Annual Report on Form 10-K for the period ended December 31, 2019, filed with the SEC on February 21, 2020, formatted in Inline eXtensible Business Reporting Language (iXBRL): (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated Statements of Shareholders' Equity, and (vi) Notes to the Consolidated Financial Statements. The instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document.
|
Signatures
|
Title
|
Date
|
|
|
|
/s/ Jacques Esculier
|
Chief Executive Officer and Chairman of the Board of Directors
|
February 21, 2020
|
Jacques Esculier
|
(Principal Executive Officer)
|
|
|
|
|
/s/ Sean Deason
|
Chief Financial Officer and Controller
|
February 21, 2020
|
Sean Deason
|
(Principal Financial Officer and Principal Accounting Officer)
|
|
|
|
|
*
|
Director
|
February 21, 2020
|
Jean-Paul L. Montupet
|
|
|
|
|
|
*
|
Director
|
February 21, 2020
|
G. Peter D'Aloia
|
|
|
|
|
|
*
|
Director
|
February 21, 2020
|
Dr. Juergen Gromer
|
|
|
|
|
|
*
|
Director
|
February 21, 2020
|
Henry R. Keizer
|
|
|
|
|
|
*
|
Director
|
February 21, 2020
|
Michael T. Smith
|
|
|
|
|
|
*
|
Director
|
February 21, 2020
|
Thomas Gross
|
|
|
|
|
|
*
|
Director
|
February 21, 2020
|
David N. ("Nick") Reilly
|
|
|
/s/ Lisa J. Brown
|
Lisa J. Brown
Attorney-in-fact
|
1 Year Wabco Chart |
1 Month Wabco Chart |
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