Basis of Presentation and Summary of Significant Accounting Policies

Our significant accounting policies are described below, as well as in other Notes that follow. Unless otherwise indicated, amounts provided in these Notes pertain to continuing operations only (see Note 4 for information on discontinued operations).

Principles of Consolidation — The consolidated financial statements include SPX Corporation’s (“SPX”, “our”, or “we”) accounts prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) after the elimination of intercompany transactions. Investments in unconsolidated companies where we exercise significant influence but do not have control are accounted for using the equity method. In determining whether we are the primary beneficiary of a variable interest entity (“VIE”), we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties to determine which party has the power to direct the activities of the VIE that most significantly impact the entity’s economic performance, and which party has the obligation to absorb losses or the right to receive benefits of the entity that could potentially be significant to the VIE. We have an interest in a VIE, in which we are not the primary beneficiary, as a result of the sale of Balcke Dürr. See below and in Notes 2, 4 and 16 for further discussion of the Balcke Dürr sale. All other VIEs are considered immaterial, individually and in aggregate, to our consolidated financial statements.

Shift Away from the Power Generation Markets — On September 26, 2015, we completed the spin-off to our stockholders (the “Spin-Off”) of all the outstanding shares of SPX FLOW, Inc., a wholly-owned subsidiary of SPX prior to the Spin-Off, which at the time of the Spin-Off held the businesses comprising our Flow Technology reportable segment, our Hydraulic Technologies business, and certain of our corporate subsidiaries. Prior to the Spin-Off, our businesses serving the power generation markets had a major impact on the consolidated financial results of SPX. In the recent years leading up to the Spin-Off, these businesses experienced significant declines in revenues and profitability associated with weak demand and increased competition within the global power generation markets. Based on a review of our post-spin portfolio and the belief that a recovery within the power generation markets was unlikely in the foreseeable future, we decided that our strategic focus would be on our (i) scalable growth businesses that serve the heating, ventilation and cooling (“HVAC”) and detection and measurement markets and (ii) power transformer and process cooling systems businesses. As a result, we have significantly reduced our exposure to the power generation markets as indicated by the activities summarized below:


•	Sale of Dry Cooling Business - On March 30, 2016, we completed the sale of our dry cooling business, a business that provides dry cooling systems to the global power generation markets and was previously reported within our Engineered Solutions reportable segment, to Paharpur Cooling Towers Limited. See Note 4 for additional details.

•

Sale of Balcke Dürr Business - On December 30, 2016, we completed the sale of Balcke Dürr, a business that provides heat exchangers and other related components to the European and Asian power generation markets, to a subsidiary of mutares AG (the “Buyer”). Balcke Dürr historically had been the most significant of our power generation businesses and, in recent years, had experienced significant declines in its operating performance as evidenced by its net loss of $39.6 in 2015. With the sale, we eliminated the losses and liquidity needs of Balcke Dürr, which were expected to be significant in the foreseeable future. As we considered the disposition of Balcke Dürr to be the cornerstone of our strategic shift away from the power generation markets, and given the significance of Balcke Dürr’s financial results to our overall operations prior to its disposition, we have classified Balcke Dürr as a discontinued operation in the accompanying consolidated financial statements. See Note 4 for additional details.

•

Planned Wind-Down of the SPX Heat Transfer Business - During the second quarter of 2018, as a continuation of our strategic shift away from power generation markets, we initiated a plan to wind-down the SPX Heat Transfer (“Heat Transfer”) business. In connection with the planned wind-down, we recorded charges of $3.5 in our 2018 operating results, with $0.9 related to the write-down of inventories (included in “Cost of products sold”), $0.6 related to the impairment of machinery and equipment and $2.0 related to severance costs (both included in “Special charges, net”). In addition, and as part of the wind-down, we sold certain intangible assets of the Heat Transfer business for net cash proceeds of $4.8, which resulted in a gain of less than $0.1 within our 2018 operating results. We anticipate completing the wind-down of Heat Transfer during of the first half of 2019.

Change in Segment Reporting Structure - During the fourth quarter of 2018, due, in part, to certain wind-down activities, and the related decline in volumes, at our South African subsidiary, DBT Technologies (PTY) LTD (“DBT”), and Heat Transfer business, we concluded that these operating segments are no longer economically similar to the other operating segments within our Engineered Solutions reportable segment. As such, DBT and Heat Transfer are now being reported, for all periods presented, within an “All Other” category outside of our reportable segments. See Note 6 for additional details.

Acquisitions in 2018:

•

Schonstedt - On March 1, 2018, we completed the acquisition of Schonstedt Instrument Company (“Schonstedt”), a manufacturer and distributor of magnetic locator products used for locating underground utilities and other buried objects, for a purchase price of $16.4, net of cash acquired of $0.3. The assets acquired and liabilities assumed have been recorded at estimates of fair value as determined by management, based on information available and on assumptions as to future operations. The post-acquisition operating results of Schonstedt are reflected within our Detection and Measurement reportable segment.

•

Cues - On June 7, 2018, we completed the acquisition of Cues, Inc. (“Cues”), a manufacturer of pipeline inspection and rehabilitation equipment, which significantly increases our presence in the pipeline inspection market. The acquisition was completed through the purchase of all of the issued and outstanding shares of Cues’ parent company for a purchase price of $164.4, net of cash acquired of $20.6. The assets acquired and liabilities assumed have been recorded at estimates of fair value as determined by management, based on information available and on assumptions as to future operations and are subject to change based on the final assessment and valuation of certain income tax amounts. The post-acquisition operating results of Cues are reflected within our Detection and Measurement reportable segment. See Note 4 for additional details on the Cues acquisition.

New Income Tax Law in the United States — On December 22, 2017, the Tax Cuts and Jobs Act (the “Act”) was enacted which significantly changes United States (“U.S.”) income tax law for businesses and individuals. The Act introduced changes that impact U.S. corporate tax rates (e.g., a reduction in the top tax rate from 35% to 21%), business-related exclusions, and deductions and credits. In addition, the Act imposes tax consequences for many entities that operate internationally, including the timing and the amount of tax to be paid on undistributed foreign earnings. As provided for by Staff Accounting Bulletin No. 118, we recorded provisional amounts in our 2017 consolidated financial statements to account for certain income tax effects of the Act. See Note 11 for a discussion of the impact of the Act on our 2018 and 2017 consolidated financial statements, including the provisional amounts that were recorded in 2017.

Retirement of Treasury Stock — In 2016, we retired 50.0 shares, or $2,948.1, of “Common stock in treasury.” Under the applicable state law, these shares represent authorized and unissued shares upon retirement. In accordance with our accounting policy, we allocate any excess of share repurchase over par value between “Paid-in capital” and “Retained earnings,” resulting in respective reductions of $1,285.4 and $1,662.2.

Foreign Currency Translation and Transactions — The financial statements of our foreign subsidiaries are translated into U.S. dollars in accordance with the Foreign Currency Matters Topic of the Financial Accounting Standards Board Codification (“Codification”). Gains and losses on foreign currency translations are reflected as a separate component of equity and other comprehensive income. Foreign currency transaction gains and losses, as well as gains and losses related to foreign currency forward contracts and currency forward embedded derivatives, are included in “Other expense, net,” with the related net losses totaling $0.3, $3.3 and $2.4 in 2018, 2017 and 2016, respectively.

Cash Equivalents — We consider highly liquid money market investments with original maturities of three months or less at the date of purchase to be cash equivalents.

Revenue Recognition — Effective January 1, 2018, we adopted Accounting Standards Codification (“ASC”) 606 under the modified retrospective transition approach. See Note 5 for our policy for recognizing revenue under ASC 606 as well as the various other disclosures required by ASC 606.

For 2017 and 2016, revenue continues to be presented based on prior guidance. Under such guidance, we recognized revenues from product sales upon shipment to the customer (e.g., FOB shipping point) or upon receipt by the customer (e.g., FOB destination). Revenues from service contracts and long-term maintenance arrangements were recognized on a straight-line basis over the agreement period. In addition, certain of our businesses, primarily within the Engineered Solutions reportable segment and those in our “All Other” group of operating segments, also recognized revenues from long-term construction/installation contracts under the percentage-of-completion method of accounting.

The percentage-of-completion on our long-term construction/installation contracts was measured principally by the percentage of costs incurred to date for each contract to the estimated costs for such contract at completion. We recognized revenues for similar short-term contracts using the completed-contract method of accounting.

Provisions for any estimated losses on uncompleted long-term contracts were made in the period in which such losses were determined. In the case of customer change orders for uncompleted long-term contracts, estimated recoveries were included for work performed in forecasting the ultimate profitability on certain contracts.

Costs and estimated earnings in excess of billings arise when revenues have been recorded but the amounts have not been billed under the terms of the contracts. Our claims related to long-term contracts were recognized as revenue only after we had determined that collection was probable and the amount could be reliably estimated. Claims against us were recognized when a loss was considered probable and the amounts were reasonably estimable.

We recognized $255.5 and $336.1 in revenues under the percentage-of-completion method for the years ended December 31, 2017 and 2016, respectively. Costs and estimated losses on uncompleted contracts, from their inception, and the related amounts billed as of December 31, 2017 were as follows:




Costs incurred on uncompleted contracts	$	1,261.3
Estimated losses to date	(59.9		)
	1,201.4
Less: Billings to date	(1,202.0		)
Billings in excess of costs and estimated losses	$	(0.6	)

The above amount is included in the accompanying consolidated balance sheet at December 31, 2017 as shown below. Amounts for billed retainages and receivables to be collected in excess of one year were not significant to the period presented




Costs and estimated losses in excess of billings ⁽¹⁾	$	28.8
Billings in excess of costs and estimated losses on uncompleted contracts ⁽²⁾	(29.4		)
Net billings in excess of costs and estimated losses	$	(0.6	)

____________________

⁽¹⁾ Reported as a component of “Accounts receivable, net.”

⁽²⁾ Reported as a component of “Accrued expenses.”

Research and Development Costs — We expense research and development costs as incurred. We charge costs incurred in the research and development of new software included in products to expense until technological feasibility is established. After technological feasibility is established, additional eligible costs are capitalized until the product is available for general release. We amortize these costs over the economic lives of the related products and include the amortization in cost of products sold. We perform periodic reviews of the recoverability of these capitalized software costs. At the time we determine that capitalized amounts are not recoverable based on the estimated cash flows to be generated from the applicable software, we write off any unrecoverable capitalized amounts. Capitalized software, net of amortization, totaled $6.2 and $8.3 as of December 31, 2018 and 2017, respectively. Capitalized software amortization expense totaled $2.4, $2.4 and $1.2 for 2018, 2017 and 2016, respectively. We expensed research activities relating to the development and improvement of our products of $22.9, $23.3 and $29.1 in 2018, 2017 and 2016, respectively.

Property, Plant and Equipment — Property, plant and equipment (“PP&E”) is stated at cost, less accumulated depreciation. We use the straight-line method for computing depreciation expense over the useful lives of PP&E, which do not exceed 40 years for buildings and range from 3 to 15 years for machinery and equipment. Depreciation expense, including amortization of capital leases, was $22.6, $22.2 and $22.5 for the years ended December 31, 2018, 2017 and 2016, respectively. Leasehold improvements are amortized over the life of the related asset or the life of the lease, whichever is shorter. Interest is capitalized on significant construction or installation projects. No interest was capitalized during 2018, 2017 or 2016.

Pension and Postretirement — We recognize changes in the fair value of plan assets and actuarial gains and losses in earnings during the fourth quarter of each year, unless earlier remeasurement is required, as a component of net periodic benefit expense and, accordingly, recognize the effects of plan investment performance, interest rate changes, and changes in actuarial assumptions as a component of earnings in the year in which they occur. The remaining components of pension/postretirement expense, primarily service and interest costs and expected return on plan assets, are recorded on a quarterly basis.

Income Taxes — We account for our income taxes based on the requirements of the Income Taxes Topic of the Codification, which includes an estimate of the amount of taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in our consolidated financial statements or tax returns. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. We periodically assess the realizability of deferred tax assets and the adequacy of deferred tax liabilities, including the results of local, state, federal or foreign statutory tax audits or estimates and judgments used.

Derivative Financial Instruments — We use foreign currency forward contracts to manage our exposures to fluctuating currency exchange rates, forward contracts to manage the exposure on forecasted purchases of commodity raw materials (“commodity contracts”) and interest rate protection agreements to manage our exposures to fluctuating interest rate risk on variable rate debt. Derivatives are recorded on the balance sheet and measured at fair value. For derivatives designated as hedges of the fair value of assets or liabilities, the changes in fair values of both the derivatives and the hedged items are recorded in current earnings. For derivatives designated as cash flow hedges, the effective portion of the changes in fair value of the derivatives is recorded in accumulated other comprehensive income (“AOCI”) and subsequently recognized in earnings when the hedged items impact earnings. Changes in the fair value of derivatives not designated as hedges, and the ineffective portion of cash flow hedges, are recorded in current earnings. We do not enter into financial instruments for speculative or trading purposes.

For those transactions that are designated as cash flow hedges, on the date the derivative contract is entered into, we document our hedge relationship, including identification of the hedging instruments and the hedged items, as well as our risk management objectives and strategies for undertaking the hedge transaction. We also assess, both at inception and quarterly thereafter, whether such derivatives are highly effective in offsetting changes in the fair value of the hedged item. See Notes 13 and 15 for further information.

Cash flows from hedging activities are included in the same category as the items being hedged, which are primarily operating activities.

Use of Estimates

12 Months Ended

Dec. 31, 2018

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Use of Estimates

The preparation of our consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. We evaluate these estimates and judgments on an ongoing basis and base our estimates on experience, current and expected future conditions, third-party evaluations and various other assumptions that we believe are reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. Actual results may differ from the estimates and assumptions used in the consolidated financial statements and related notes.

Listed below are certain significant estimates and assumptions used in the preparation of our consolidated financial statements. Certain other estimates and assumptions are further explained in the related notes.

Accounts Receivable Allowances — We provide allowances for estimated losses on uncollectible accounts based on our historical experience and the evaluation of the likelihood of success in collecting specific customer receivables. In addition, we maintain allowances for customer returns, discounts and invoice pricing discrepancies, with such allowances primarily based on historical experience. Summarized below is the activity for these allowance accounts.



	Year ended December 31,
	2018			2017			2016
Balance at beginning of year	$	10.2		$	10.1		$	9.1
Allowances provided	17.7			13.2			15.7
Write-offs, net of recoveries, credits issued and other	(15.7		)	(13.1		)	(14.7		)
Balance at end of year	$	12.2		$	10.2		$	10.1

Inventory — We estimate losses for excess and/or obsolete inventory and the net realizable value of inventory based on the aging and historical utilization of the inventory and the evaluation of the likelihood of recovering the inventory costs based on anticipated demand and selling price.

Long-Lived Assets and Intangible Assets Subject to Amortization — We continually review whether events and circumstances subsequent to the acquisition of any long-lived assets, or intangible assets subject to amortization, have occurred that indicate the remaining estimated useful lives of those assets may warrant revision or that the remaining balance of those assets may not be fully recoverable. If events and circumstances indicate that the long-lived assets should be reviewed for possible impairment, we use projections to assess whether future cash flows on an undiscounted basis related to the assets are likely to exceed the related carrying amount. We will record an impairment charge to the extent that the carrying value of the assets exceed their fair values as determined by valuation techniques appropriate in the circumstances, which could include the use of similar projections on a discounted basis.

In determining the estimated useful lives of definite-lived intangibles, we consider the nature, competitive position, life cycle position, and historical and expected future operating cash flows of each acquired asset, as well as our commitment to support these assets through continued investment and legal infringement protection.

Goodwill and Indefinite-Lived Intangible Assets — We test goodwill and indefinite-lived intangible assets for impairment annually during the fourth quarter and continually assess whether a triggering event has occurred to determine whether the carrying value exceeds the implied fair value. The fair value of reporting units is based generally on discounted projected cash flows, but we also consider factors such as comparable industry price multiples. We employ cash flow projections that we believe to be reasonable under current and forecasted circumstances, the results of which form the basis for making judgments about the carrying values of the reported net assets of our reporting units. Many of our businesses closely follow changes in the industries and end markets that they serve. Accordingly, we consider estimates and judgments that affect the future cash flow projections, including principal methods of competition, such as volume, price, service, product performance and technical innovations, as well as estimates associated with cost reduction initiatives, capacity utilization and assumptions for inflation and foreign currency changes.

Accrued Expenses — We make estimates and judgments in establishing accruals as required under GAAP. Summarized in the table below are the components of accrued expenses at December 31, 2018 and 2017.



	December 31,
	2018		2017
Employee benefits	$	68.5	$	68.9
Unearned revenue ⁽¹⁾	—		100.1
Warranty	12.0		13.8
Other⁽²⁾	103.2		109.8
Total	$	183.7	$	292.6

___________________________________________________________________

⁽¹⁾

Unearned revenue include billings in excess of costs and estimated earnings on uncompleted contracts accounted for under the percentage-of-completion method of revenue recognition, customer deposits and unearned amounts on service contracts. Effective January 1, 2018, we adopted ASC 606. In accordance with ASC 606, contract liabilities are separately presented within our consolidated balance sheet as of December 31, 2018. Refer to Note 5 for further information on contract liabilities.


⁽²⁾	Other consists of various items including, among other items, accrued legal, interest and restructuring costs, none of which is individually material.

Legal — It is our policy to accrue for estimated losses from legal actions or claims when events exist that make the realization of the losses probable and they can be reasonably estimated. We do not discount legal obligations or reduce them by anticipated insurance recoveries.

Environmental Remediation Costs — We expense costs incurred to investigate and remediate environmental issues unless they extend the economic useful lives of related assets. We record liabilities when it is probable that an obligation has been incurred and the amounts can be reasonably estimated. Our environmental accruals cover anticipated costs, including investigation, remediation and operation and maintenance of clean-up sites. Our estimates are based primarily on investigations and remediation plans established by independent consultants, regulatory agencies and potentially responsible third parties. We generally do not discount environmental obligations or reduce them by anticipated insurance recoveries.

Risk Management Matters — We are subject to claims associated with risk management matters (e.g., product liability, predominately associated with alleged exposure to asbestos-containing materials, general liability, automobile, and workers’ compensation claims). The liabilities we record for these claims are based on a number of assumptions, including historical claims and payment experience and, with respect to asbestos claims, actuarial estimates of the future period during which additional claims are reasonably foreseeable. We also have recorded insurance recovery assets associated with the asbestos product liability matters. These assets represent amounts that we believe we are or will be entitled to recover under agreements we have with insurance companies. The assets we record for these insurance recoveries are based on a number of assumptions, including the continued solvency of the insurers, and are subject to a variety of uncertainties. In addition, we are self-insured for certain of our workers’ compensation, automobile, product, general liability, disability and health costs, and we maintain adequate accruals to cover our retained liabilities. Our accruals for self-insurance liabilities are based on claims filed and an estimate of claims incurred but not yet reported, and generally are not discounted. We consider a number of factors, including third-party actuarial valuations, when making these determinations. We maintain third-party stop-loss insurance policies to cover certain liability costs in excess of predetermined retained amounts; however, this insurance may be insufficient or unavailable (e.g., because of insurer insolvency) to protect us against potential loss exposures. The key assumptions considered in estimating the ultimate cost to settle reported claims and the estimated costs associated with incurred but not yet reported claims include, among other factors, our historical and industry claims experience, trends in health care and administrative costs, our current and future risk management programs, and historical lag studies with regard to the timing between when a claim is incurred and reported. See Note 14 for additional details.

Warranty — In the normal course of business, we issue product warranties for specific products and provide for the estimated future warranty cost in the period in which the sale is recorded. We provide for the estimate of warranty cost based on contract terms and historical warranty loss experience that is periodically adjusted for recent actual experience. Because warranty estimates are forecasts that are based on the best available information, claims costs may differ from amounts provided. In addition, due to the seasonal fluctuations at certain of our businesses, the timing of warranty provisions and the usage of warranty accruals can vary period to period. We make adjustments to initial obligations for warranties as changes in the obligations become reasonably estimable. The following is an analysis of our product warranty accrual for the periods presented:



	Year ended December 31,
	2018			2017			2016
Balance at beginning of year	$	33.9		$	35.8		$	36.3
Acquisitions	1.0			—			—
Impact of initial adoption of ASC 606	0.4			—			—
Provisions	11.9			13.0			15.2
Usage	(13.1		)	(15.4		)	(15.5		)
Currency translation adjustment	(0.1		)	0.5			(0.2		)
Balance at end of year	34.0			33.9			35.8
Less: Current portion of warranty	12.0			13.8			15.6
Non-current portion of warranty	$	22.0		$	20.1		$	20.2

__________________________________________________________________

Income Taxes — We perform reviews of our income tax positions on a continuous basis and accrue for potential uncertain tax positions in accordance with the Income Taxes Topic of the Codification. Accruals for these uncertain tax positions are classified as “Income taxes payable” and “Deferred and other income taxes” in the accompanying consolidated balance sheets based on an expectation as to the timing of when the matter will be resolved. As events change or resolutions occur, these accruals are adjusted, such as in the case of audit settlements with taxing authorities. For tax positions where it is more likely than not that a tax benefit will be sustained, we record the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate settlement with a taxing authority, assuming such authority has full knowledge of all relevant information. These reviews also entail analyzing the realization of deferred tax assets. When we believe that it is more likely than not that we will not realize a benefit for a deferred tax asset based on all available evidence, we establish a valuation allowance.

Employee Benefit Plans — Defined benefit plans cover a portion of our salaried and hourly employees, including certain employees in foreign countries. As discussed in Note 1, we recognize changes in the fair value of plan assets and actuarial gains and losses associated with our pension and postretirement benefit plans in earnings during the fourth quarter of each year, unless earlier remeasurement is required, as a component of net periodic benefit expense. The remaining components of pension/postretirement expense, primarily service and interest costs and expected return on plan assets, are recorded on a quarterly basis. See Note 10 for further discussion of our pension and postretirement benefits.

We derive pension expense from an actuarial calculation based on the defined benefit plans’ provisions and our assumptions regarding discount rate and rate of increase in compensation levels. We determine the discount rate for our more significant U.S. plans by matching the expected projected benefit obligation cash flows of the plans to a yield curve that is representative of long-term, high-quality (rated AA or higher) fixed income debt instruments as of the measurement date. For our other plans, we determine the discount rate based on representative bond indices. The rate of increase in compensation levels is established based on our expectations of current and foreseeable future increases in compensation. We also consult with independent actuaries in determining these assumptions.

Parent Guarantees and Bonds Associated with Balcke Dürr — As further discussed in Note 4, in connection with the sale of Balcke Dürr, we remain contingently obligated under existing parent company guarantees and bank and surety bonds which totaled approximately Euro 79.0 and Euro 79.0, respectively, at the time of sale (and Euro 31.7 and Euro 21.8, respectively, at December 31, 2018). We have accounted for our contingent obligation in accordance with the Guarantees Topic of the Codification, which required that we record a liability for the estimated fair value of the parent company guarantees and the bonds in connection with the accounting for the sale of Balcke Dürr. We estimated the fair value of the parent company guarantees and bank and surety bonds considering the probability of default by Balcke Dürr and an estimate of the amount we would be obligated to pay in the event of a default. As also discussed in Note 4, under the related purchase agreement, Balcke Dürr provided cash collateral and mutares AG provided a partial guarantee in the event any of the bonds are called. We recorded an asset for the estimated fair value of the cash collateral provided by Balcke Dürr and the partial guarantee provided by mutares AG, with the estimated fair values based on the terms and conditions and relative risk associated with each of these securities. By way of an offset to “Other expense, net,” we are reducing the liability and amortizing the asset, with the reduction of the liability generally to occur upon return of the guarantee or bond which is expected to occur at the earlier of the completion of the related underlying project milestones or the expiration of the guarantees or bonds, and the amortization of the asset to occur based on the expiration terms of each of the securities. We will continue to evaluate the adequacy of the recorded liability and will record an adjustment to the liability if we conclude that it is probable that we will be required to fund an amount greater than what is recorded. See Note 16 for further information regarding the estimated fair values of the parent company guarantees and bonds, as well as the cash collateral provided by Balcke Dürr and the partial guarantee provided by mutares AG.

New Accounting Pronouncements

12 Months Ended

Dec. 31, 2018

New Accounting Pronouncements

The following is a summary of new accounting pronouncements that apply or may apply to our business.

ASC Topic 606

In May 2014, the Financial Accounting Standards Board (“FASB”) issued a new standard on revenue recognition (“ASC 606”) that outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. ASC 606 contains a five-step approach that entities will apply to determine the measurement of revenue and timing of when it is recognized, including (i) identifying the contract(s) with a customer, (ii) identifying the separate performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to separate performance obligations, and (v) recognizing revenue when (or as) each performance obligation is satisfied. ASC 606 also requires a number of quantitative and qualitative disclosures intended to enable users of the financial statements to understand the nature, amount, timing, and uncertainty of revenue, and the related cash flows. Effective January 1, 2018, we adopted ASC 606 using the modified retrospective transition approach for all contracts not completed as of the date of adoption. The modified retrospective transition approach recognizes any changes as of the beginning of the year of initial application (i.e., as of January 1, 2018) through retained earnings, with no restatement of comparative periods.

The only significant change in revenue recognition as a result of the adoption of ASC 606 relates to our power transformer business. Under ASC 606, revenues for our power transformer business are being recognized over time, while under previous revenue recognition guidance (ASC 605), revenues for power transformers were recognized at a point in time. See Note 5 for further discussion of our revenue recognition principles under, and the post-adoption impact of, ASC 606.

Summarized below is the impact of the initial application of ASC 606 on our consolidated balance sheet:



	December 31, 2017			Impact of Adoption of ASC 606			January 1, 2018

Assets
Accounts receivable, net	$	267.5		$	(36.0	)	$	231.5
Inventories, net	143.0			(40.2		)	102.8
Contract assets	—			70.7			70.7
Other current assets	97.7			(3.6		)	94.1
Deferred income taxes	50.9			(0.9		)	50.0

Liabilities
Contract liabilities	—			86.9			86.9
Accrued expenses	292.6			(99.0		)	193.6
Other long-term liabilities	885.8			(1.6		)	884.2

Equity
Accumulated other comprehensive income	250.1			(0.3		)	249.8
Retained deficit	$	(742.3	)	$	4.0		$	(738.3	)

In January 2016, the FASB issued an amendment to guidance that (i) requires equity securities (excluding equity method investments) to be measured at fair value, with changes in fair value recognized in net earnings, and (ii) enhances the disclosure associated with these instruments. The amendment allows equity securities that do not have readily determinable fair values to be measured at fair value, either upon the occurrence of an observable price change or identification of an impairment. We adopted this amendment in 2018, with the impact limited to an adjustment to the carrying value of an equity security that we had been accounting for based on its historical cost. In connection with our adoption, we adjusted the carrying value of this equity security to its estimated fair value, which resulted in a reduction, net of tax, of our retained deficit of $12.0. See Note 16 for additional details.

In February 2016, the FASB issued an amendment to existing guidance that requires lessees to recognize assets and liabilities for the rights and obligations created by leases with terms that exceed twelve months. In addition, this amendment requires new qualitative and quantitative disclosures about leasing arrangements. This standard is effective for annual reporting periods beginning on or after December 15, 2018 for public business entities, and interim periods within those annual reporting periods. Early adoption is permitted, and we plan to adopt the standard as of January 1, 2019 on a modified retrospective basis. We will elect the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allows us to not reassess the lease classification for any expired or existing leases. We have yet to finalize our analysis of the initial impact of the new standard on our consolidated financial statements, but currently estimate that the adoption will result in the recognition of additional lease assets and lease liabilities not exceeding $35.0. We do not believe the adoption will have a material impact on our future results of operations. The standard will have no impact on our debt-covenant compliance under our current agreements. Refer to Note 14 for additional information regarding future minimum lease payments.

In August 2016, the FASB issued an amendment to existing guidance to reduce diversity in practice in how certain cash receipts and cash payments are presented in the statement of cash flows. This amendment provides clarification on eight specific cash flow presentation issues. The issues include, but are not limited to, debt prepayment or extinguishment costs, settlement of zero-coupon debt, proceeds from the settlement of insurance claims, and cash receipts from payments on beneficial interests in securitization transactions. This amendment is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods, and is to be applied retrospectively. We adopted this guidance during the first quarter of 2018. In connection with the adoption, we reclassified net proceeds related to company-owned life insurance policies of $0.7 and $7.7 from operating activities to investing activities within the consolidated statements of cash flows for the years ended December 31, 2017 and 2016, respectively.

In October 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-16, which removes the prohibition in ASC 740 against the immediate recognition of the current and deferred income tax effects of intra-entity transfers of assets other than inventory. ASU 2016-16 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods. The requirements of ASU 2016-16 are to be applied on a modified retrospective basis, which entails recognizing the initial effect of adoption in retained earnings. We adopted ASU 2016-16 as of January 1, 2018, which resulted in an increase of our retained deficit of $0.2.

In January 2017, the FASB issued an amendment to simplify the subsequent measurement of goodwill by removing the second step of the two-step impairment test. The amendment requires that an entity recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value. This amendment is effective for annual reporting periods beginning after December 31, 2019, including interim periods within those annual reporting periods. Early adoption is permitted. The impact of this amendment on our consolidated financial statements will depend on the results of future goodwill impairment tests.

In March 2017, the FASB issued an amendment to revise the presentation of net periodic pension and postretirement benefit cost. The amendment requires the service cost component to be presented separately from the other components of net periodic pension and postretirement benefit cost. Service cost is required to be presented with other employee compensation costs within operating income. The other components of net periodic pension and postretirement benefit cost, such as interest cost, expected return on plan assets, amortization of prior service cost/credits, and gains or losses, are required to be separately presented outside of operating income. This amendment is effective for annual reporting periods beginning after December 15, 2017, including interim periods within those annual reporting periods, with the financial statement presentation requirements of the amendment applied retrospectively. We adopted this guidance during the first quarter of 2018. In connection with the adoption, we reclassified $5.1 and $15.0 of net periodic pension and postretirement benefit expense from “Selling, general and administrative” to “Other expense, net” within the accompanying consolidated statements of operations for the years ended December 31, 2017 and 2016, respectively. See Note 10 for details of our pension and postretirement expense.

In August 2017, the FASB issued significant amendments to hedge accounting. The new guidance will make more financial and nonfinancial hedging strategies eligible for hedge accounting. It also amends the presentation and disclosure requirements and changes how companies assess effectiveness. It is intended to more closely align hedge accounting with companies’ risk management strategies, simplify the application of hedge accounting, and increase transparency as to the scope and results of hedging programs. The amendments can be adopted immediately in any interim or annual period (including the current period). We will adopt this guidance on January 1, 2019, with such adoption not expected to have a material impact to our consolidated financial statements.

In February 2018, the FASB amended its guidance for reporting comprehensive income to reflect the potential impacts of the reduction in the corporate tax rate resulting from the Act. The amendment gives the option of reclassifying the stranded tax effects within AOCI to retained earnings during the fiscal year or quarter in which the effect of the lower tax rate is recorded. The amendment is effective for years beginning after December 15, 2018, with early adoption permitted. We adopted this guidance as of January 1, 2018, which resulted in an increase of our retained deficit of $4.8.

Acquisitions, Discontinued Operations, and Other Dispositions

12 Months Ended

Dec. 31, 2018

Business Combinations And Discontinued Operations [Abstract]

Acquisitions, Discontinued Operations, and Other Dispositions

Acquisition of Cues

As indicated in Note 1, on June 7, 2018, we completed the acquisition of Cues for $164.4, net of cash acquired of $20.6. We financed the acquisition with available cash and borrowings under our senior credit and trade receivables financing arrangements. The assets acquired and liabilities assumed have been recorded at estimates of fair value as determined by management, based on information available and on assumptions as to future operations and are subject to change based on the final assessment and valuation of certain income tax amounts. The following is a summary of the recorded fair values of the assets acquired and liabilities assumed for Cues as of June 7, 2018:



Assets acquired:
Current assets, including cash and equivalents of $20.6	$	70.4
Property, plant and equipment	7.4
Goodwill	48.6
Intangible assets	79.5
Other assets	2.3
Total assets acquired	208.2

Current liabilities assumed	7.8
Non-current liabilities assumed	15.4

Net assets acquired	$	185.0

The identifiable intangible assets acquired consist of a trademark, customer backlog, customer relationships, and technology of $27.6, $0.8, $42.6, and $8.5, respectively, with such amounts based on an assessment of the related fair values. We expect to amortize the customer backlog, customer relationships, and technology assets over 0.5, 12.0, and 11.0 years, respectively.

We acquired gross receivables of $13.6, which had a fair value at the acquisition date of $13.2 based on our estimates of cash flows expected to be recovered.

The qualitative factors that comprise the recorded goodwill include expected synergies from combining our existing inspection equipment operations with those of Cues, expected market growth for Cues’ existing operations, and various other factors. We expect none of this goodwill or the intangible assets described above to be deductible for tax purposes.

For the period June 7, 2018 to December 31, 2018, Cues recognized revenues and a net loss of $52.3 and $0.4, respectively with the net loss impacted by charges of $4.3 associated with the excess fair value (over historical cost) of inventory acquired which has been subsequently sold. During the year ended December 31, 2018, we incurred acquisition related costs for Cues of $2.4, which have been recorded to “Selling, general and administrative” within the accompanying consolidated statement of operations.

The following unaudited pro forma information presents our consolidated results of operations for the years ended December 31, 2018 and 2017 as if the acquisition of Cues had taken place on January 1, 2017. The unaudited pro forma financial information is not intended to represent or be indicative of our consolidated results of operations that would have been reported had the acquisition been completed as of the date presented, and should not be taken as representative of our future consolidated results of operations. The pro forma results include estimates and assumptions that management believes are reasonable; however, these results do not include any anticipated cost savings or expenses of the planned integration of Cues. These pro forma results of operations have been prepared for comparative purposes only and include additional interest expense on the borrowings required to finance the acquisition, additional depreciation and amortization expense associated with fair value adjustments to the acquired property, plant and equipment and intangible assets, the removal of charges associated with the excess fair value (over historical cost) of inventory acquired and subsequently sold, the removal of professional fees and other one-time costs incurred in connection with the transaction, and the related income tax effects.



	Years ended December 31,
	2018		2017
Revenues	$	1,572.7	$	1,511.4
Income from continuing operations	87.1		87.4
Net income	90.1		92.7

Income from continuing operations per share of common stock:
Basic	$	2.02	$	2.06
Diluted	$	1.95	$	1.99

Net income per share of common stock:
Basic	$	2.09	$	2.19
Diluted	$	2.02	$	2.11

Acquisition of Schonstedt

As indicated in Note 1, on March 1, 2018, we completed the acquisition of Schonstedt for $16.4, net of cash acquired of $0.3. The pro forma effects of the Schonstedt acquisition are not material to our consolidated results of operations.

Sale of Balcke Dürr Business

As indicated in Note 1, on December 30, 2016, we completed the sale of Balcke Dürr for cash proceeds of less than $0.1. In addition, we left $21.1 of cash in Balcke Dürr at the time of the sale. In connection with the sale, we recorded a net loss of $78.6 to “Gain (loss) on disposition of discontinued operations, net of tax” during the fourth quarter of 2016.

The purchase agreement provides that existing parent company guarantees and bank and surety bonds, which totaled approximately Euro 79.0 and Euro 79.0, respectively, at the time of sale (and Euro 31.7 and Euro 21.8, respectively, at December 31, 2018), will remain in place through each instrument’s expiration date, with such expiration dates occurring through 2022. Balcke Dürr and the Buyer have provided us an indemnity in the event that any of the bonds are called. Also, at the time of sale, Balcke Dürr provided cash collateral of Euro 4.0 and mutares AG provided a guarantee of Euro 5.0 as a security for the above indemnifications (Euro 3.0 and Euro 5.0, respectively, at December 31, 2018). The net loss recorded at the time of the sale of $78.6 includes a charge of $5.1 associated with the estimated fair value of the guarantees and bonds, after consideration of the indemnifications provided in the event any of the bonds are called. See Note 16 for further details regarding the estimated fair value of these guarantees and bonds.

As indicated in Note 1, the results of Balcke Dürr are presented as a discontinued operation within the accompanying consolidated financial statements. Major classes of line items constituting pre-tax loss and after-tax loss of Balcke Dürr for the year ended December 31, 2016 are shown below:




Revenues	$	153.4
Costs and expenses:
Costs of products sold	144.2
Selling, general and administrative	31.4
Special charges (credits), net	(1.3		)
Other expense, net	(0.2		)
Loss before taxes	(21.1		)
Income tax benefit	4.5
Loss from discontinued operations	$	(16.6	)

The following table presents selected financial information for Balcke Dürr that is included within discontinued operations in the consolidated statement of cash flows for the year ended December 31, 2016:




Non-cash items included in income (loss) from discontinued operations, net of tax
Depreciation and amortization	$	2.0
Capital expenditures	0.7

During 2017, we reduced the net loss associated with the sale of Balcke Dürr by $6.8. The reduction was comprised of an additional income tax benefit recorded for the sale of $9.4, partially offset by the impact of adjustments to liabilities retained in connection with the sale and certain other adjustments. During the second quarter of 2018, we reached a settlement with the Buyer on the amount of cash and working capital at the closing date, as well as on various other matters, for a net payment from the Buyer in the amount of Euro 3.0. The settlement resulted in a gain, net of tax, of $3.8, which was recorded to “Gain (loss) on disposition of discontinued operations, net of tax” during the second quarter of 2018.

Other Discontinued Operations Activity

In addition to the businesses discussed above, we recognized net losses of $0.8, $1.5 and $2.7 during 2018, 2017 and 2016, respectively, resulting from adjustments to gains/losses on dispositions of businesses discontinued prior to 2016.

Changes in estimates associated with liabilities retained in connection with a business divestiture (e.g., income taxes) may occur. As a result, it is possible that the resulting gains/losses on these and other previous divestitures may be materially adjusted in subsequent periods.

For the years ended December 31, 2018, 2017 and 2016, results of operations from our businesses reported as discontinued operations were as follows:



	Year ended December 31,
	2018			2017			2016
Balcke Dürr
Income (loss) from discontinued operations	$	6.3		$	(2.6	)	$	(107.0	)
Income tax (provision) benefit	(2.5		)	9.4			11.8
Income (loss) from discontinued operations, net	3.8			6.8			(95.2		)


All other
Loss from discontinued operations	(1.2		)	(4.0		)	(3.7		)
Income tax benefit	0.4			2.5			1.0
Loss from discontinued operations, net	(0.8		)	(1.5		)	(2.7		)

Total
Income (loss) from discontinued operations	5.1			(6.6		)	(110.7		)
Income tax (provision) benefit	(2.1		)	11.9			12.8
Income (loss) from discontinued operations, net	$	3.0		$	5.3		$	(97.9	)

Other Dispositions

As indicated in Note 1, on March 30, 2016, we completed the sale of our dry cooling business for cash proceeds of $47.6 (net of cash transferred with the business of $3.0). In connection with the sale, we recorded a gain of $18.4. The gain includes a reclassification from “Equity” of other comprehensive income of $40.4 related to foreign currency translation.

Revenues from Contracts

12 Months Ended

Dec. 31, 2018

Revenue from Contract with Customer [Abstract]

Revenues from Contracts

As indicated in Notes 1 and 3, effective January 1, 2018, we adopted ASC 606 under the modified retrospective transition approach. As a result, for periods prior to 2018, revenue continues to be presented based on prior guidance. Summarized below is our policy for recognizing revenue under ASC 606, as well as the various disclosures required by ASC 606.

Performance Obligations - Certain of our contracts are comprised of multiple deliverables, which can include hardware and software components, installation, maintenance, and extended warranties. For these contracts, we evaluate whether these deliverables represent separate performance obligations as defined by ASC 606. In some cases, a customer contracts with us to integrate a complex set of tasks and components into a single project or capability (even if the single project results in the delivery of multiple units). Hence, the entire contract is treated as a single performance obligation. In contrast, we may promise to provide distinct goods or services within a contract, in which case we separate the contract into more than one performance obligation. If a contract is separated into more than one performance obligation, we allocate the total transaction price to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. In cases where we sell standard products with observable standalone selling prices, these selling prices are used to determine the standalone selling price. In cases where we sell a customized customer specific solution, we typically use the expected cost plus margin approach to estimate the standalone selling price of each performance obligation. Sales taxes and other usage-based taxes are excluded from revenue.

Remaining performance obligations represent performance obligations that have yet to be satisfied. As a practical expedient, we do not disclose performance obligations that are (i) part of a contract that has an original expected duration of less than one year (this encompasses substantially all contracts with customers in the HVAC and Detection and Measurement reportable segments) and/or (ii) satisfied in a manner consistent with our right to consideration from the customer (i.e., revenue is recognized as value is transferred). Performance obligations for contracts with an original duration in excess of one year that have yet to be satisfied as of the end of a period primarily relate to our large process cooling systems and large South African projects, as well as certain of our bus fare collection systems. As of December 31, 2018, the aggregate amount allocated to remaining performance obligations after the effect of practical expedients was $97.2. We expect to recognize revenue on approximately 50% and 70% of the remaining performance obligations over the next 12 and 24 months, respectively, with the remaining recognized thereafter.

Options - We offer options within certain of our contracts to purchase future goods or services. To the extent the option provides a material right to a future benefit (i.e., future goods and services at a discount from the relative standalone selling price), we separate the material right as a performance obligation and adjust the standalone selling price of the other performance obligations within the contract. When determining the relative standalone selling price of the option, we first determine the incremental discount that the customer would receive by exercising the option and then adjust that value based on the probability of option exercise (based, where possible, on historical experience). Revenue is recognized for the option as either the option is exercised or when it expires.

Contract Combination and Modification - We assess each contract at its inception to determine whether it should be combined with other contracts for revenue recognition purposes. When making this determination, we consider factors such as whether two or more contracts with a customer were negotiated at or near the same time or were negotiated with an overall profit objective. Contracts are sometimes modified for changes in contract specifications, scope, or price (or a combination of these). Contract modifications for goods or services that are not distinct within the context of the contract (generally associated with specification changes for certain product lines within our Engineered Solutions reportable segment and “All Other” category of operating segments) are accounted for as part of the existing contract. Contract modifications for goods or services that are distinct (i.e., adding or subtracting distinct goods or services) are accounted for as either a termination of the existing contract and the creation of a new contract (where the goods or services are not priced at their standalone selling price), or the creation of separate contract (where the goods or services are priced at their standalone selling price).

Variable Consideration - We determine the transaction price for each contract based on the consideration we expect to receive for the products or services being provided under the contract. For contracts where a portion of the price may vary, we estimate the variable consideration at the amount to which we expect to be entitled, which is included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur. We analyze the risk of a significant revenue reversal and, if necessary, constrain the amount of variable consideration recognized in order to mitigate this risk. Variable consideration primarily pertains to late delivery penalties, unapproved change orders and claims (levied by us and /or against us), and index-based pricing. Actual amounts of consideration ultimately received may differ from our estimates. If actual results vary from our estimates, we will adjust these estimates, which would affect revenue and earnings in the period such variances become known.

As noted above, the nature of our contracts gives rise to several types of variable consideration, including unapproved change orders and claims. We include in our contract estimates additional revenue for unapproved change orders or claims against the customer when we believe we have an enforceable right to the unapproved change order or claim, the amount can be reliably estimated, and the above criteria have been met. In evaluating these criteria, we consider the contractual/legal basis for the claim, the cause of any additional costs incurred, the reasonableness of those costs, and the objective evidence available to support the claim. These estimates are also based on historical award experience. At December 31, 2018, our recorded cumulative revenues related to the large power projects in South Africa included approximately $37.9 related to claims and unapproved change orders. See Note 14 for additional details on our large power projects in South Africa.

Returns, Customer Sales Incentives and Warranties - We have certain arrangements that require us to estimate, at the time of sale, the amounts of variable consideration that should be excluded from revenue as (i) certain amounts are not expected to be collected from customers and/or (ii) the product may be returned. We principally rely on historical experience, specific customer agreements, and anticipated future trends to estimate these amounts at the time of shipment and to reduce the transaction price. These arrangements include volume rebates, which are estimated using the most likely amount method, as well as early payment discounts and promotional and advertising allowances, which are estimated using the expected value method. We primarily offer assurance-type standard warranties that the product will conform to published specifications for a defined period of time after delivery. These types of warranties do not represent separate performance obligations. We establish provisions for estimated returns and warranties primarily based on contract terms and historical experience, using the expected value method. Certain businesses offer extended warranties, which are considered separate performance obligations.

Contract Costs - We have elected to apply the practical expedient provided under ASC 606 which allows an entity to expense incremental costs of obtaining or fulfilling a contract when incurred if the amortization period of the asset that the entity otherwise would have recorded is one year or less. Shipping and handling costs associated with outbound freight after control over a product has transferred to a customer are accounted for as fulfillment costs and are included in cost of products sold. The net asset recorded for incremental costs incurred to obtain or fulfill contracts, after consideration of the practical expedient mentioned above, is not material to our consolidated financial statements.

Nature of Goods and Services, Satisfaction of Performance Obligations, and Payment Terms

Our HVAC product lines include package cooling towers, residential and commercial boilers, and comfort heating and ventilation products. Performance obligations for our HVAC product lines relate primarily to the delivery of equipment and components, with satisfaction of these performance obligations occurring at the time of shipment or delivery (i.e., control is transferred at a point in time). The typical length of a contract is one to three months and payment terms are generally 15 to 60 days after shipment to the customer.

Our detection and measurement product lines include underground pipe and cable locators, inspection and rehabilitation equipment, bus fare collection systems, signal monitoring, and obstruction lighting. Performance obligations for these product lines relate to delivery of equipment and components, installation and other short-term services, long-term maintenance and software subscription services. Performance obligations for equipment and components generally are satisfied at the time of shipment or delivery (i.e., control is transferred at a point in time). Performance obligations for installation and other short-term services are satisfied over time as the installation or service is performed. Performance obligations for maintenance and software subscription services are satisfied over time, with the related revenue recorded evenly throughout the contract service period as this method best depicts how control of the service is transferred. Payment terms for equipment and components are typically 30 to 60 days after shipment or delivery, while payment for services typically occurs at completion for shorter-term engagements (less than three months in duration) and throughout the service period for longer-term engagements (generally greater than three months in duration). These product lines have varying contract lengths ranging from one to eighteen months (with the longer term contracts generally associated with our bus fare collection systems and signal monitoring products lines), with the typical duration being one to three months.

Our engineered solutions product lines include medium and large power transformers and process cooling equipment. Performance obligations for these product lines relate to delivery of equipment and components, construction and reconstruction of cooling towers and other components, and providing installation, replacement/spare parts, and various other services. For these product lines, our customers typically contract with us to provide a customer-specific solution. The customer typically controls the work in process due to contractual termination clauses whereby we have an enforceable right to recovery of cost incurred including a reasonable profit for work performed to date on products or services that do not have an alternative use to us. Additionally, certain projects are performed on customer sites such that the customer controls the asset as it is created or enhanced. As such, performance obligations for these product lines are generally satisfied over time, with the related revenue recorded based on the percentage of costs incurred to date for each contract to the estimated total costs for such contract at completion, as this method best depicts how control of the product or service is being transferred. Revenue for sales of certain engineered components and all replacement/spare parts is recognized upon shipment or delivery (i.e., at a point in time). The length of customer contract is generally 6 to 12 months for our power transformers business and 6 to 18 months for our process cooling business. Payments on longer-term contracts are generally commensurate with milestones defined in the related contract, while payments for the replacement/spare parts contracts typically occur 30 to 60 days after delivery.

Our remaining (“All Other”) product lines include primarily heat exchangers and two large power plant contracts in our South African business. Performance obligations for these product lines relate to delivery of equipment and components and construction, installation, and various other services. For these product lines, our customers typically contract with us to provide a customer-specific solution. The customer typically controls the work in process due to contractual termination clauses whereby we have an enforceable right to recovery of cost incurred including a reasonable profit for work performed to date on products or services that do not have an alternative use to us. Additionally, certain projects are performed on customer sites such that the customer controls the asset as it is created or enhanced. As such, performance obligations for these product lines are generally satisfied over time, with the related revenue recorded based on the percentage of costs incurred to date for each contract to the estimated total costs for such contract at completion, as this method best depicts how control of the product or service is being transferred. The length of customer contract is generally 6 to 18 months for our heat exchanger business. The large contracts in our South African business relate to the construction of two large power plants that have a length in excess of 10 years. Payments for these product lines are generally commensurate with milestones defined in the related contract.

Customer prepayments, progress billings, and retention payments are customary in certain of our project-based businesses, generally for our engineered solutions and “All Other” product lines and, to a lesser extent, our detection and measurement product lines. Customer prepayments, progress billings, and retention payments are not considered a significant financing component because they are intended to protect either the customer or ourselves in the event that some or all of the obligations under the contract are not completed. Additionally, most contract assets are expected to convert to accounts receivable, and contract liabilities are expected to convert to revenue, within one year. As such, after applying the practical expedient to exclude potential financing components that are less than one year in duration, we do not have any such financing components.

Disaggregated Revenues

We disaggregate revenue from contracts with customers by major product line and based on the timing of recognition for each of our reportable segments and our group of other operating segments, as we believe such disaggregation best depicts how the nature, amount, timing, and uncertainty of our revenues and cash flows are effected by economic factors, with such disaggregation presented below for the year ended December 31, 2018:



	Year Ended December 31, 2018
Reportable Segments and All Other	HVAC		Detection and Measurement		Engineered Solutions		All Other		Total

Major product lines
Cooling	$	281.7	$	—	$	—	$	—	$	281.7
Boilers, comfort heating, and ventilation	300.4		—		—		—		300.4
Underground locators and inspection and rehabilitation equipment	—		159.1		—		—		159.1
Signal monitoring, obstruction lighting, and bus fare collection systems	—		161.8		—		—		161.8
Power transformers	—		—		373.8		—		373.8
Process cooling equipment, services, and heat exchangers	—		—		163.2		49.5		212.7
South African projects	—		—		—		49.1		49.1
	$	582.1	$	320.9	$	537.0	$	98.6	$	1,538.6

Timing of Revenue Recognition
Revenues recognized at a point in time	$	582.1	$	307.3	$	61.5	$	5.1	$	956.0
Revenues recognized over time	—		13.6		475.5		93.5		582.6
	$	582.1	$	320.9	$	537.0	$	98.6	$	1,538.6

Contract Balances

Our customers are invoiced for products and services at the time of delivery or based on contractual milestones, resulting in outstanding receivables with payment terms from these customers (“Contract Accounts Receivable”). In some cases, the timing of revenue recognition, particularly for revenue recognized over time, differs from when such amounts are invoiced to customers, resulting in a contract asset (revenue recognition precedes the invoicing of the related revenue amount) or a contract liability (payment from the customer precedes recognition of the related revenue amount). Contract assets and liabilities are generally classified as current. On a contract-by-contract basis, the contract assets and contract liabilities are reported net within our consolidated balance sheet. Our contract balances consisted of the following as of December 31, 2018 and January 1, 2018:



Contract Balances	December 31, 2018			January 1, 2018 ⁽¹⁾			Change
Contract Accounts Receivable ⁽²⁾	$	263.9		$	222.9		$	41.0
Contract Assets	91.2			70.7			20.5
Contract Liabilities - current	(79.5		)	(86.9		)	7.4
Contract Liabilities - non-current ⁽³⁾	(2.1		)	—			(2.1		)
Net contract balance	$	273.5		$	206.7		$	66.8

_____________________

⁽¹⁾ See Note 3 for the impact of the change at January 1, 2018 as a result of the adoption of ASC 606.

⁽²⁾ Included in “Accounts receivable, net” within the accompanying consolidated balance sheet.

⁽³⁾ Included in “Other long-term liabilities” within the accompanying consolidated balance sheet.

The $66.8 increase in our net contract balance from January 1, 2018 to December 31, 2018 was due primarily to revenue recognized during the period, partially offset by cash payments received from customers during the period.

During 2018, we recognized revenues of $67.8 related to our contract liabilities at January 1, 2018.

Impact of ASC 606 Adoption

Summarized below is a comparison of our consolidated statement of operations and comprehensive income for the year ended December 31, 2018 and consolidated balance sheet as of December 31, 2018 as prepared under the provisions of ASC 606 to a presentation of these financial statements under the prior revenue recognition guidance. As previously discussed, the most significant impact of adopting ASC 606 relates to our power transformer business where, under ASC 606, revenues for power transformers are now being recorded over time versus at a point in time under the prior revenue recognition guidance. The initial transition to ASC 606 resulted in a reduction of inventory and deferred revenue (previously presented within “Accrued expenses”) and an increase to contract assets, as indicated in Note 3. Contract assets and contract liabilities are now separately presented within our consolidated balance sheet (previously included in “Accounts receivable, net” and “Accrued expenses”, respectively). Additionally, and as noted below, the difference in revenue and earnings under prior revenue recognition guidance during the year ended December 31, 2018 is due primarily to the timing of power transformer deliveries.



	Year ended December 31, 2018
Consolidated statement of operations and comprehensive income	Reported			Effect of ASC 606 Adoption			Under Prior Revenue Recognition Guidance
Revenues	$	1,538.6		$	(14.2	)	$	1,524.4
Cost of products sold	1,127.9			(11.6		)	1,116.3
Selling, general and administrative	292.6			(0.6		)	292.0
Operating income	107.6			(2.0		)	105.6
Income from continuing operations before income taxes	79.6			(2.0		)	77.6
Income tax provision	(1.4		)	0.5			(0.9		)
Income from continuing operations	78.2			(1.5		)	76.7
Net income	$	81.2		$	(1.5	)	$	79.7

Comprehensive income	$	76.0		$	(0.5	)	$	75.5

Basic income per share of common stock:
Income from continuing operations	$	1.82		$	(0.04	)	$	1.78
Net income per share	$	1.89		$	(0.04	)	$	1.85

Diluted income per share of common stock:
Income from continuing operations	$	1.75		$	(0.03	)	$	1.72
Net income per share	$	1.82		$	(0.03	)	$	1.79



	As of December 31, 2018
Consolidated balance sheet	Reported			Effect of ASC 606 Adoption			Under Prior Revenue Recognition Guidance
Accounts receivable, net	$	269.1		$	33.2		$	302.3
Contract assets	91.2			(91.2		)	—
Inventories, net	128.8			52.1			180.9
Other current assets	40.5			4.1			44.6
Total current assets	598.4			(1.8		)	596.6
Deferred income taxes	24.4			1.4			25.8
TOTAL ASSETS	$	2,057.5		$	(0.4	)	$	2,057.1
Contract liabilities	$	79.5		$	(79.5	)	$	—
Accrued expenses	183.7			82.0			265.7
Total current liabilities	470.2			2.5			472.7
Other long-term liabilities	817.3			1.6			818.9
Total long-term liabilities	1,172.4			1.6			1,174.0

Retained deficit	(650.1		)	(5.5		)	(655.6		)
Accumulated other comprehensive income	244.9			1.0			245.9
Total equity	414.9			(4.5		)	410.4
TOTAL LIABILITIES AND EQUITY	$	2,057.5		$	(0.4	)	$	2,057.1

Consolidated statement of cash flows - The impact of ASC 606 on our consolidated statement of cash flows for the year ended December 31, 2018 is not presented, as the only impact to operating cash flows related to changes to net income and certain working capital amounts (no change to total operating cash flows) and there is no impact to investing or financing cash flows.

Information on Reportable and Other Operating Segments

12 Months Ended

Dec. 31, 2018

Segment Reporting [Abstract]

Information on Reportable and Other Operating Segments

We are a global supplier of highly specialized, engineered solutions with operations in approximately 15 countries and sales in over 100 countries around the world.

As indicated in Note 1, our DBT and Heat Transfer operating segments are now being reported in an “All Other” category for segment reporting purposes. We have aggregated our other operating segments into the following three reportable segments: HVAC, Detection and Measurement and Engineered Solutions. The factors considered in determining our aggregated segments are the economic similarity of the businesses, the nature of products sold or services provided, production processes, types of customers, distribution methods, and regulatory environment. In determining our reportable segments, we apply the threshold criteria of the Segment Reporting Topic of the Codification. Operating income or loss for each of our operating segments is determined before considering impairment and special charges, pension and postretirement expense/income, long-term incentive compensation, gains (losses) on the sale of our dry cooling business, and other indirect corporate expenses. This is consistent with the way our Chief Operating Decision Maker evaluates the results of each segment.

HVAC Reportable Segment

Our HVAC reportable segment engineers, designs, manufactures, installs and services cooling products for the HVAC and industrial markets, as well as boilers, comfort heating and ventilation products for the residential and commercial markets. The primary distribution channels for the segment’s products are direct to customers, independent manufacturing representatives, third-party distributors, and retailers. The segment serves a customer base in North America, Europe, and Asia Pacific.

Detection and Measurement Reportable Segment

Our Detection and Measurement reportable segment engineers, designs, manufactures and installs underground pipe and cable locators, inspection and rehabilitation equipment, bus fare collection systems, communication technologies, and specialty lighting. The primary distribution channels for the segment’s products are direct to customers and third-party distributors. The segment serves a global customer base, with a strong presence in North America, Europe and Asia Pacific.

Engineered Solutions Reportable Segment

Our Engineered Solutions reportable segment engineers, designs, manufactures, installs and services transformers for the power transmission and distribution market and process cooling equipment for the industrial and power generation markets. The primary distribution channels for the segment’s products are direct to customers and third-party representatives. The segment has a strong presence in North America.

All Other

Our “All Other” group of operating segments engineer, design, manufacture, install and service equipment, including heat exchangers, for the industrial and power generation markets. The primary distribution channels for the group’s products are direct to customers and third-party representatives. These operating segments have a presence in North America and South Africa.

Corporate Expense

Corporate expense generally relates to the cost of our Charlotte, NC corporate headquarters.

Financial data for our reportable segments and other operating segments for the years ended December 31, 2018, 2017 and 2016 were as follows:



	2018			2017			2016
Revenues:
HVAC reportable segment	$	582.1		$	511.0		$	509.5
Detection and Measurement reportable segment	320.9			260.3			226.4
Engineered Solutions reportable segment	537.0			560.7			598.0
All Other ⁽¹⁾	98.6			93.8			138.4
Consolidated revenues	$	1,538.6		$	1,425.8		$	1,472.3
Income (loss):
HVAC reportable segment	$	90.0		$	74.1		$	80.2
Detection and Measurement reportable segment	72.4			63.4			45.3
Engineered Solutions reportable segment	35.0			44.2			39.1
All Other ⁽¹⁾⁽²⁾	(18.9		)	(56.8		)	(21.8		)
Total income for segments	178.5			124.9			142.8
Corporate expense	48.5			46.2			41.7
Pension and postretirement expense	—			0.3			0.4
Long-term incentive compensation expense	15.5			15.8			13.7
Impairment of intangible assets	—			—			30.1
Special charges, net	6.3			2.7			5.3
Gain (loss) on sale of dry cooling business	(0.6		)	—			18.4
Consolidated operating income	$	107.6		$	59.9		$	70.0

Capital expenditures:
HVAC reportable segment	$	2.7		$	2.2		$	1.9
Detection and Measurement reportable segment	1.9			0.8			0.7
Engineered Solutions reportable segment	6.9			5.8			5.6
All Other	0.1			0.3			0.9
General corporate	0.8			1.9			2.6
Total capital expenditures	$	12.4		$	11.0		$	11.7
Depreciation and amortization:
HVAC reportable segment	$	5.4		$	5.5		$	5.3
Detection and Measurement reportable segment	8.4			4.1			3.5
Engineered Solutions reportable segment	10.6			10.4			11.0
All Other	1.8			2.1			4.2
General corporate	3.0			3.1			2.5
Total depreciation and amortization	$	29.2		$	25.2		$	26.5

	2018			2017			2016
Identifiable assets:
HVAC reportable segment	$	778.5		$	747.1		$	710.1
Detection and Measurement reportable segment	479.0			277.8			244.2
Engineered Solutions reportable segment	422.4			466.2			462.5
All Other	82.2			91.6			105.1
General corporate	295.4			457.7			390.6
Total identifiable assets	$	2,057.5		$	2,040.4		$	1,912.5
Geographic Areas:
Revenues: ⁽³⁾
United States	$	1,317.5		$	1,243.3		$	1,235.2
China	38.5			28.0			33.5
South Africa ⁽¹⁾	72.7			56.9			105.4
United Kingdom	62.4			60.8			59.1
Other	47.5			36.8			39.1
	$	1,538.6		$	1,425.8		$	1,472.3



Tangible Long-Lived Assets:
United States	$	837.4	$	919.6	$	897.0
Other	28.9		24.8		29.6
Total tangible long-lived assets	$	866.3	$	944.4	$	926.6

___________________________________________________________________

⁽¹⁾

As further discussed in Note 14, during the third quarter of 2018 and second and fourth quarters of 2017, we made revisions to our estimates of expected revenues and costs on our large power projects in South Africa. As a result of these revisions, we reduced 2018 revenues by $2.7 and 2017 revenues by $36.9 ($13.5 and $23.4 during the second and fourth quarters of 2017, respectively), and 2018 segment income by $4.7 and 2017 segment income by $52.8 ($22.9 and $29.9 in the second and fourth quarters of 2017, respectively).


⁽²⁾	During the third quarter of 2017, we settled a contract that had been suspended and then ultimately canceled by a customer of our Heat Transfer operating segment for cash proceeds of $9.0 and other consideration. In connection with the settlement, we recorded a gain of $10.2.


⁽³⁾	Revenues are included in the above geographic areas based on the country that recorded the customer revenue.

Special Charges, Net

12 Months Ended

Dec. 31, 2018

Restructuring and Related Activities [Abstract]

Special Charges, Net

As part of our business strategy, we periodically right-size and consolidate operations to improve long-term results. Additionally, from time to time, we alter our business model to better serve customer demand, discontinue lower-margin product lines and rationalize and consolidate manufacturing capacity. Our restructuring and integration decisions are based, in part, on discounted cash flows and are designed to achieve our goals of reducing structural footprint and maximizing profitability. As a result of our strategic review process, we recorded net special charges of $6.3 in 2018, $2.7 in 2017 and $5.3 in 2016. These net special charges were primarily related to restructuring initiatives to consolidate manufacturing and sales facilities, reduce workforce, and rationalize certain product lines.

The components of the charges have been computed based on actual cash payouts, including severance and other employee benefits based on existing severance policies, local laws, and other estimated exit costs, and our estimate of the realizable value of the affected tangible and intangible assets.

Impairments of long-lived assets, including amortizable intangibles, which represent non-cash asset write-downs, typically arise from business restructuring decisions that lead to the disposition of assets no longer required in the restructured business. For these situations, we recognize a loss when the carrying amount of an asset exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Fair values for assets subject to impairment testing are determined primarily by management, taking into consideration various factors including third-party appraisals, quoted market prices and previous experience. If an asset remains in service at the decision date, the asset is written down to its fair value and the resulting net book value is depreciated over its remaining economic useful life. When we commit to a plan to sell an asset, including the initiation of a plan to locate a buyer, and it is probable that the asset will be sold within one year based on its current condition and sales price, depreciation of the asset is discontinued and the asset is classified as an asset held for sale. The asset is written down to its fair value less any selling costs.

Liabilities for exit costs, including, among other things, severance, other employee benefit costs, and operating lease obligations on idle facilities, are measured initially at their fair value and recorded when incurred.

We anticipate that the liabilities related to restructuring actions will be paid within one year from the period in which the action was initiated.

Special charges for the years ended December 31, 2018, 2017 and 2016 are described in more detail below and in the applicable sections that follow:



	Years Ended December 31,
	2018		2017		2016
Employee termination costs	$	5.7	$	2.5	$	1.7
Other cash costs, net	—		0.2		—
Non-cash asset write-downs	0.6		—		3.6
Total	$	6.3	$	2.7	$	5.3

2018 Charges:



	Employee Termination Costs		Other Cash Costs, Net		Non-Cash Asset Write-downs		Total Special Charges
HVAC reportable segment	$	0.8	$	—	$	—	$	0.8
Detection and Measurement reportable segment	—		—		—		—
Engineered Solutions reportable segment	—		—		—		—
All Other	4.4		—		0.6		5.0
Corporate	0.5		—		—		0.5
Total	$	5.7	$	—	$	0.6	$	6.3

HVAC — Charges for 2018 related primarily to severance costs associated with restructuring actions at the boiler and Cooling Americas’ businesses. These actions resulted in the termination of 18 employees.

All Other — Charges for 2018 related primarily to severance and other costs associated with the planned wind-down of our Heat Transfer business and a restructuring action at DBT, our South African business. These actions resulted in the termination of 295 employees.

Corporate — Charges for 2018 related to severance costs incurred in connection with the rationalization of certain administrative functions. These actions resulted in the termination of 6 employees.

2017 Charges:



	Employee Termination Costs		Other Cash Costs, Net		Non-Cash Asset Write-downs		Total Special Charges
HVAC reportable segment	$	0.4	$	—	$	—	$	0.4
Detection and Measurement reportable segment	0.3		—		—		0.3
Engineered Solutions reportable segment	0.2		0.2		—		0.4
All Other	1.5		—		—		1.5
Corporate	0.1		—		—		0.1
Total	$	2.5	$	0.2	$	—	$	2.7

HVAC — Charges for 2017 related primarily to severance costs associated with a restructuring action at our Cooling Americas’ heating business. This action resulted in the termination of 12 employees.

Detection and Measurement — Charges for 2017 related to severance costs associated with a restructuring action at our communication technologies business. The action resulted in the termination of 8 employees.

Engineered Solutions — Charges for 2017 related primarily to severance costs associated with a restructuring action at our process cooling business. The action resulted in the termination of 3 employees.

All Other — Charges for 2017 related primarily to severance costs associated with a restructuring action at DBT. The action resulted in the termination of 108 employees.

Corporate — Charges for 2017 related to severance costs incurred in connection with the sale of Balcke Dürr. The action resulted in the termination of 4 employees.

2016 Charges:



	Employee Termination Costs		Other Cash Costs, Net		Non-Cash Asset Write-downs		Total Special Charges
HVAC reportable segment	$	—	$	—	$	—	$	—
Detection and Measurement reportable segment	0.5		—		0.3		0.8
Engineered Solutions reportable segment	0.1		—		—		0.1
All Other	1.1		—		3.3		4.4
Corporate	—		—		—		—
Total	$	1.7	$	—	$	3.6	$	5.3

Detection and Measurement — Charges for 2016 related to severance and other costs associated with our bus fare collection business. These actions resulted in the termination of 19 employees.

Engineered Solutions — Charges for 2016 related to severance and other costs associated with our transformers business. The action resulted in the termination of 6 employees

All Other — Charges for 2016 related primarily to costs incurred in connection with restructuring actions at our Heat Transfer business in order to reduce the cost base of the business in response to reduced demand. The cost incurred for these restructuring actions included asset impairment charges of $3.3 associated with the discontinuance of a product line and outsourcing initiatives, as well as severance costs. These restructuring activities resulted in the termination of 91 employees.

The following is an analysis of our restructuring liabilities for the years ended December 31, 2018, 2017 and 2016:



	December 31,
	2018			2017			2016
Balance at beginning of year	$	0.6		$	0.9		$	1.6
Special charges⁽¹⁾	5.7			2.7			1.7
Utilization — cash	(3.6		)	(3.0		)	(2.1		)
Currency translation adjustment and other	—			—			(0.3		)
Balance at the end of year	$	2.7		$	0.6		$	0.9

___________________________________________________________________


⁽¹⁾	The years ended December 31, 2018, 2017 and 2016 excluded $0.6, $0.0 and $3.6, respectively, of non-cash charges that impacted special charges but not the restructuring liabilities.

Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill, for the year ended December 31, 2018, were as follows:



	December 31, 2017			Goodwill Resulting from Business Combinations ⁽¹⁾		Impairments		Foreign Currency Translation			December 31, 2018
HVAC reportable segment
Gross goodwill	$	263.7		$	—	$	—	$	(1.9	)	$	261.8
Accumulated impairments	(144.7		)	—		—		0.3			(144.4		)
Goodwill	119.0			—		—		(1.6		)	117.4
Detection and Measurement reportable segment
Gross goodwill	216.6			50.4		—		(2.0		)	265.0
Accumulated impairments	(136.0		)	—		—		1.7			(134.3		)
Goodwill	80.6			50.4		—		(0.3		)	130.7
Engineered Solutions reportable segment
Gross goodwill	337.5			—		—		(2.2		)	335.3
Accumulated impairments	(191.2		)	—		—		2.2			(189.0		)
Goodwill	146.3			—		—		—			146.3
All Other
Gross goodwill	20.8			—		—		—			20.8
Accumulated impairments	(20.8		)	—		—		—			(20.8		)
Goodwill	—			—		—		—			—
Total
Gross goodwill	838.6			50.4		—		(6.1		)	882.9
Accumulated impairments	(492.7		)	—		—		4.2			(488.5		)
Goodwill	$	345.9		$	50.4	$	—	$	(1.9	)	$	394.4

⁽¹⁾ Reflects amounts acquired in connection with the Schonstedt and Cues acquisitions of $1.8 and $48.6, respectively.

The changes in the carrying amount of goodwill, for the year ended December 31, 2017, were as follows:



	December 31, 2016			Impairments		Foreign Currency Translation			December 31, 2017
HVAC reportable segment
Gross goodwill	$	258.5		$	—	$	5.2		$	263.7
Accumulated impairments	(144.2		)	—		(0.5		)	(144.7		)
Goodwill	114.3			—		4.7			119.0
Detection and Measurement reportable segment
Gross goodwill	214.4			—		2.2			216.6
Accumulated impairments	(134.2		)	—		(1.8		)	(136.0		)
Goodwill	80.2			—		0.4			80.6
Engineered Solutions reportable segment
Gross goodwill	330.6			—		6.9			337.5
Accumulated impairments	(184.7		)	—		(6.5		)	(191.2		)
Goodwill	145.9			—		0.4			146.3
All Other
Gross goodwill	20.8			—		—			20.8
Accumulated impairments	(20.8		)	—		—			(20.8		)
Goodwill	—			—		—			—
Total
Gross goodwill	824.3			—		14.3			838.6
Accumulated impairments	(483.9		)	—		(8.8		)	(492.7		)
Goodwill	$	340.4		$	—	$	5.5		$	345.9

Identifiable intangible assets were as follows:



	December 31, 2018							December 31, 2017
	Gross Carrying Value		Accumulated Amortization			Net Carrying Value		Gross Carrying Value		Accumulated Amortization			Net Carrying Value
Intangible assets with determinable lives:⁽¹⁾
Customer relationships	$	44.8	$	(3.5	)	$	41.3	$	1.4	$	(1.4	)	$	—
Technology	17.1		(1.1		)	16.0		2.1		(0.5		)	1.6
Patents	4.5		(4.5		)	—		4.5		(4.5		)	—
Other	11.3		(7.9		)	3.4		11.7		(7.9		)	3.8
	77.7		(17.0		)	60.7		19.7		(14.3		)	5.4
Trademarks with indefinite lives ⁽²⁾	137.7		—			137.7		112.2		—			112.2
Total	$	215.4	$	(17.0	)	$	198.4	$	131.9	$	(14.3	)	$	117.6

⁽¹⁾

The identifiable intangible assets associated with the Schonstedt acquisition consist of customer relationships and technology of $0.8 and $8.3, respectively. The identifiable intangible assets associated with the Cues acquisition consist of customer backlog, customer relationships, and technology of $0.8, $42.6, and $8.5, respectively. Additionally, the technology associated with our Heat Transfer business of $1.5 was sold during the second quarter of 2018 in connection with the planned wind-down of the business.


⁽²⁾	Changes during 2018 related primarily to the acquisition of the Schonstedt and Cues trademarks of $1.8 and $27.6, respectively, and the sale of the trademarks associated with our Heat Transfer business of $3.3 in connection with the planned wind-down of the business.

Amortization expense was $4.2, $0.6 and $2.8 for the years ended December 31, 2018, 2017 and 2016, respectively. Estimated amortization expense over each of the next five years is $5.2 related to these intangible assets.

At December 31, 2018, the net carrying value of intangible assets with determinable lives consisted of $3.4 in the HVAC reportable segment and $57.3 in the Detection and Measurement reportable segment. Trademarks with indefinite lives consisted of $89.3 in the HVAC reportable segment, $39.3 in the Detection and Measurement reportable segment, and $9.1 in the Engineered Solutions reportable segment.

Consistent with the requirements of the Intangible — Goodwill and Other Topic of the Codification, the fair values of our reporting units generally are estimated using discounted cash flow projections that we believe to be reasonable under current and forecasted circumstances, the results of which form the basis for making judgments about carrying values of the reported net assets of our reporting units. Other considerations are also incorporated, including comparable industry price multiples. Many of our reporting units closely follow changes in the industries and end markets that they serve. Accordingly, we consider estimates and judgments that affect the future cash flow projections, including principal methods of competition such as volume, price, service, product performance and technical innovations and estimates associated with cost improvement initiatives, capacity utilization and assumptions for inflation and foreign currency changes. Any significant change in market conditions and estimates or judgments used to determine expected future cash flows that indicate a reduction in carrying value may give rise to impairment in the period that the change becomes known.

We perform our annual goodwill impairment testing during the fourth quarter in conjunction with our annual financial planning process, with such testing based primarily on events and circumstances existing as of the end of the third quarter. In addition, we test goodwill for impairment on a more frequent basis if there are indications of potential impairment. Based on our annual goodwill impairment testing in the fourth quarter of 2018, we concluded that the estimated fair value of each of our reporting units, exclusive of Cues, exceeds the carrying value of their respective net assets by over 90%. The estimated fair value of Cues approximates the carrying value of its net assets.

During 2016, we recorded impairment charges of $30.1 associated with Heat Transfer’s trademarks and definite-lived intangible assets. During the second quarter of 2018, we sold certain intangible assets of Heat Transfer for net cash proceeds of $4.8, which approximated the carrying value of the intangible assets that were sold. After such sale, the carrying value of Heat Transfer’s intangible assets was $0.0.

Employee Benefit Plans

12 Months Ended

Dec. 31, 2018

Retirement Benefits [Abstract]

Employee Benefit Plans

Overview — Defined benefit pension plans cover a portion of our salaried and hourly paid employees, including certain employees in foreign countries. Beginning in 2001, we discontinued providing these pension benefits generally to newly hired employees. Effective January 31, 2018, we no longer provide service credits to active participants.

We have domestic postretirement plans that provide health and life insurance benefits to certain retirees and their dependents. Beginning in 2003, we discontinued providing these postretirement benefits generally to newly hired employees.

The plan year-end date for all our plans is December 31.

Actuarial Gains and Losses - As indicated in Note 2, actuarial gains and losses related to our pension and postretirement plans are recorded to earnings during the fourth quarter of each year, unless earlier remeasurement is required. Below is a summary of transactions during 2016, 2017 and 2018 that required remeasurement of our pension and postretirement plans.

In connection with the Spin-Off, participants in the SPX U.S. Pension Plan (the “U.S. Plan”) that were transferred to SPX FLOW became eligible to elect a lump-sum payment option in lieu of a future pension benefit under the U.S. Plan. During the second quarter of 2016, approximately 9%, or $25.2, of the projected benefit obligation of the U.S. Plan was settled as a result of lump-sum payments. In connection with these lump-sum payments, we remeasured the assets and liabilities of the U.S. Plan during the second quarter of 2016, which resulted in a charge to net periodic pension benefit expense of $1.0 during 2016.

During the second quarter of 2016, we made lump-sum payments to certain participants of the Supplemental Individual Account Retirement Plan (“SIARP”), settling approximately 22%, or $2.7, of the SIARP’s projected benefit obligation. In connection with these lump-sum payments, we remeasured the liabilities of the SIARP, which resulted in a charge to net periodic pension benefit expense of $0.8 during 2016.

In July 2014, we discontinued our sponsorship of post-65 age healthcare plans, effective January 1, 2015, which resulted in eligible retirees being transitioned to coverage in the individual healthcare insurance market that we subsidize through health reimbursement accounts. In November 2014, a lawsuit was filed challenging certain aspects of this action. In September 2017, we received a favorable ruling related to the lawsuit. During the third quarter of 2017, in connection with the favorable ruling, we reduced our unfunded liability related to postretirement benefits by $26.8. The offset for the reduction of the unfunded liability was recorded to accumulated other comprehensive income and represents unrecognized prior service credits. These unrecognized prior service credits are being recorded to net periodic postretirement benefit (income) expense over a period of approximately eight years, beginning in the fourth quarter of 2017. In addition, we remeasured our unfunded liability related to postretirement benefits, which resulted in a gain within net periodic postretirement benefit expense and a reduction of the unfunded liability of $2.6 during the third quarter of 2017.

Defined Benefit Pension Plans

Plan assets — Our investment strategy is based on the long-term growth and protection of principle while mitigating overall risk to ensure that funds are available to pay benefit obligations. The domestic plan assets are invested in a broad range of investment classes, including fixed income securities and domestic and international equities. We engage various investment managers who are regularly evaluated on long-term performance, adherence to investment guidelines and the ability to manage risk commensurate with the investment style and objective for which they were hired. We continuously monitor the value of assets by class and routinely rebalance our portfolio with the goal of meeting our target allocations.

The strategy for bonds emphasizes investment-grade corporate and government debt with maturities matching a portion of the longer duration pension liabilities. The bonds strategy also includes a high yield element, which is generally shorter in duration. The strategy for equity assets is to minimize concentrations of risk by investing primarily in companies in a diversified mix of industries worldwide, while targeting neutrality in exposure to global versus regional markets, fund types and fund managers. A small portion of U.S. plan assets (Level 3 assets) is allocated to private equity partnerships and real estate asset fund investments for diversification, providing opportunities for above market returns.

Allowable investments under the plan agreements include fixed income securities, equity securities, mutual funds, venture capital funds, real estate and cash and equivalents. In addition, investments in futures and option contracts, commodities and other derivatives are allowed in commingled fund allocations managed by professional investment managers. Investments prohibited under the plan agreements include private placements and short selling of stock. No shares of our common stock were held by our defined benefit pension plans as of December 31, 2018 or 2017.

Actual asset allocation percentages of each class of our domestic and foreign pension plan assets as of December 31, 2018 and 2017, along with the targeted asset investment allocation percentages, each of which is based on the midpoint of an allocation range, were as follows:

Domestic Pension Plans



	Actual Allocations				Mid-point of Target Allocation Range
	2018		2017		2018
Fixed income common trust funds	70	%	70	%	65	%
Commingled global fund allocation	11	%	12	%	18	%
Non-U.S. Government securities	1	%	1	%	—	%
Global equity common trust funds	6	%	7	%	5	%
U.S. Government securities	10	%	9	%	10	%
Short-term investments ⁽¹⁾	2	%	1	%	2	%
Total	100	%	100	%	100	%

___________________________________________________________________


⁽¹⁾	Short-term investments are generally invested in actively managed common trust funds or interest-bearing accounts.

Foreign Pension Plans



	Actual Allocations				Mid-point of Target Allocation Range
	2018		2017		2018
Global equity common trust funds	17	%	17	%	13	%
Fixed income common trust funds	39	%	46	%	39	%
Commingled global fund allocation	36	%	34	%	37	%
Non-U.S. Government securities	7	%	—	%	7	%
Short-term investments ⁽¹⁾	1	%	3	%	4	%
Total	100	%	100	%	100	%

___________________________________________________________________


⁽¹⁾	Short-term investments are generally invested in actively managed common trust funds or interest-bearing accounts.

The fair values of pension plan assets at December 31, 2018, by asset class, were as follows:



	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Asset class:
Debt securities:
Fixed income common trust funds ^{(1) (2)}	$	228.5	$	—	$	228.5	$	—
Corporate bonds	—		—		—		—
Non-U.S. Government securities	11.5		—		11.5		—
U.S. Government securities	24.0		—		24.0		—
Equity securities:
Global equity common trust funds ⁽¹⁾ ⁽³⁾	41.1		—		41.1		—
Alternative investments:
Commingled global fund allocations ⁽¹⁾ ⁽⁴⁾	83.3		—		83.3		—
Other:
Short-term investments ⁽⁵⁾	7.8		7.8		—		—
Other	1.0		—		—		1.0
Total	$	397.2	$	7.8	$	388.4	$	1.0

The fair values of pension plan assets at December 31, 2017, by asset class, were as follows:



	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Asset class:
Debt securities:
Fixed income common trust funds ^{(1) (2)}	$	270.2	$	—	$	270.2	$	—
Corporate bonds	1.6		—		1.6		—
Non-U.S. Government securities	—		—		—		—
U.S. Government securities	25.2		—		25.2		—
Equity securities:
Global equity common trust funds ⁽¹⁾ ⁽³⁾	50.6		—		50.6		—
Alternative Investments:	—		—		—		—
Commingled global fund allocations ⁽¹⁾ ⁽⁴⁾	95.1		—		95.1		—
Other:
Short-term investments ⁽⁵⁾	9.4		9.4		—		—
Other	1.0		—		—		1.0
Total	$	453.1	$	9.4	$	442.7	$	1.0

___________________________________________________________________

⁽¹⁾

Common/commingled trust funds are similar to mutual funds, with a daily net asset value per share measured by the fund sponsor and used as the basis for current transactions. These investments, however, are not registered with the U.S. Securities and Exchange Commission and participation is not open to the public. The funds are valued at the net asset value per share multiplied by the number of shares held as of the measurement date.


⁽²⁾	This class represents investments in actively managed common trust funds that invest in a variety of fixed income investments, which may include corporate bonds, both U.S. and non-U.S. municipal securities, interest rate swaps, options and futures.


⁽³⁾	This class represents investments in actively managed common trust funds that invest primarily in equity securities, which may include common stocks, options and futures.


⁽⁴⁾	This class represents investments in actively managed common trust funds with investments in both equity and debt securities. The investments may include common stock, corporate bonds, U.S. and non-U.S. municipal securities, interest rate swaps, options and futures.


⁽⁵⁾	Short-term investments are valued at $1.00/unit, which approximates fair value. Amounts are generally invested in actively managed common trust funds or interest-bearing accounts.

Up until April 30, 2018, our domestic pension plans participated in a securities lending program through J.P. Morgan Chase Bank, National Association. Securities loaned were required to be fully collateralized by cash or other securities. The gross collateral and the related liability to return collateral amounted to $0.5 at December 31, 2017, and have been included within Level 2 of the fair value hierarchy in the table above.

There were no changes in the fair value of Level 3 assets for the years ended December 31, 2018 and 2017.

Employer Contributions — We currently fund U.S. pension plans in amounts equal to the minimum funding requirements of the Employee Retirement Income Security Act of 1974, plus additional amounts that may be approved from time to time. During 2018, we made no contributions to our qualified domestic pension plans, and direct benefit payments of $6.2 to our non-qualified domestic pension plans. In 2019, we do not expect to make any minimum required funding contributions to our qualified domestic pension plans and expect to make direct benefit payments of $5.8 to our non-qualified domestic pension plans.

In 2018, we made contributions of $1.1 to our foreign pension plans. In 2019, we expect to make contributions of $1.0 to our foreign pension plans.

Estimated Future Benefit Payments — Following is a summary, as of December 31, 2018, of the estimated future benefit payments for our pension plans in each of the next five fiscal years and in the aggregate for five fiscal years thereafter. Benefit payments are paid from plan assets or directly by us for our non-funded plans. The expected benefit payments are estimated based on the same assumptions used at December 31, 2018 to measure our obligations and include benefits attributable to estimated future employee service.

Estimated future benefit payments: (Domestic and foreign pension plans)

	Domestic Pension Benefits		Foreign Pension Benefits
2019	$	24.1	$	5.1
2020	23.6		5.0
2021	23.3		5.1
2022	24.8		6.0
2023	24.5		6.0
Subsequent five years	108.6		35.0

Obligations and Funded Status — The funded status of our pension plans is dependent upon many factors, including returns on invested assets and the level of market interest rates. Our non-funded pension plans account for $64.2 of the current underfunded status, as these plans are not required to be funded. The following tables show the domestic and foreign pension plans’ funded status and amounts recognized in our consolidated balance sheets:



	Domestic Pension Plans						Foreign Pension Plans
	2018			2017			2018			2017
Change in projected benefit obligation:
Projected benefit obligation — beginning of year	$	357.1		$	348.1		$	175.2		$	157.6
Service cost	—			0.3			—			—
Interest cost	12.3			13.4			4.7			4.9
Actuarial (gains) losses	(25.4		)	16.5			(6.8		)	6.7
Settlements	(11.1		)	—			—			—
Curtailment losses	—			0.9			—			—
Plan amendment	—			—			1.2			—
Benefits paid	(12.0		)	(22.1		)	(5.0		)	(8.1		)
Foreign exchange and other	—			—			(11.1		)	14.1
Projected benefit obligation — end of year	$	320.9		$	357.1		$	158.2		$	175.2



	Domestic Pension Plans						Foreign Pension Plans
	2018			2017			2018			2017
Change in plan assets:
Fair value of plan assets — beginning of year	$	269.7		$	261.9		$	183.4		$	163.3
Actual return on plan assets	(14.8		)	23.6			(8.7		)	10.6
Contributions (employer and employee)	6.2			6.3			1.1			3.4
Settlements	(11.1		)	—			—			—
Benefits paid	(12.0		)	(22.1		)	(5.0		)	(8.7		)
Foreign exchange and other	—			—			(11.6		)	14.8
Fair value of plan assets — end of year	$	238.0		$	269.7		$	159.2		$	183.4
Funded status at year-end	(82.9		)	(87.4		)	1.0			8.2
Amounts recognized in the consolidated balance sheets consist of:
Other assets	$	—		$	—		$	3.3		$	8.4
Accrued expenses	(5.6		)	(5.9		)	—			—
Other long-term liabilities	(77.3		)	(81.5		)	(2.3		)	(0.2		)
Net amount recognized	$	(82.9	)	$	(87.4	)	$	1.0		$	8.2
Amount recognized in accumulated other comprehensive income (pre-tax) consists of — net prior service (credits) costs	$	(0.4	)	$	(0.6	)	$	1.2		$	—

The following is information about our pension plans that had accumulated benefit obligations in excess of the fair value of their plan assets at December 31, 2018 and 2017:



	Domestic Pension Plans				Foreign Pension Plans
	2018		2017		2018		2017
Projected benefit obligation	$	320.9	$	357.1	$	43.6	$	0.2
Accumulated benefit obligation	320.9		357.1		43.6		0.2
Fair value of plan assets	238.0		269.7		41.3		—

The accumulated benefit obligation for all domestic and foreign pension plans was $320.9 and $158.2, respectively, at December 31, 2018 and $357.1 and $175.2, respectively, at December 31, 2017.

Components of Net Periodic Pension Benefit Expense (Income) — Net periodic pension benefit expense (income) for our domestic and foreign pension plans included the following components:

Domestic Pension Plans



	Year ended December 31,
	2018			2017			2016
Service cost	$	—		$	0.3		$	0.4
Interest cost	12.3			13.4			13.9
Expected return on plan assets	(10.3		)	(10.1		)	(12.9		)
Amortization of unrecognized prior service credits	(0.2		)	(0.1		)	(0.2		)
Recognized net actuarial (gains) losses ⁽¹⁾	(0.2		)	3.9			3.2
Total net periodic pension benefit expense	$	1.6		$	7.4		$	4.4

___________________________________________________________________


⁽¹⁾	Consists primarily of our reported actuarial (gains) losses, the difference between actual and expected returns on plan assets, settlement gains (losses), and curtailment gains. The actuarial losses for 2016 included $1.8 related to the lump-sum payment actions that took place during the second quarter of the year.

Foreign Pension Plans



	Year ended December 31,
	2018			2017			2016
Service cost	$	—		$	—		$	—
Interest cost	4.7			4.9			5.6
Expected return on plan assets	(7.5		)	(6.4		)	(6.6		)
Recognized net actuarial losses ⁽¹⁾	9.1			3.1			8.2
Total net periodic pension benefit expense	6.3			1.6			7.2
Less: Net periodic pension expense of discontinued operations	—			—			(0.2		)
Net periodic pension benefit expense of continuing operations	$	6.3		$	1.6		$	7.0

___________________________________________________________________


⁽¹⁾	Consists of our reported actuarial losses and the difference between actual and expected returns on plan assets.

Assumptions — Actuarial assumptions used in accounting for our domestic and foreign pension plans were as follows:



	Year ended December 31,
	2018		2017		2016
Domestic Pension Plans
Weighted-average actuarial assumptions used in determining net periodic pension expense:
Discount rate	3.57	%	3.98	%	4.06	%
Rate of increase in compensation levels	N/A		3.75	%	3.75	%
Expected long-term rate of return on assets	4.00	%	4.00	%	5.00	%
Weighted-average actuarial assumptions used in determining year-end benefit obligations:
Discount rate	4.29	%	3.57	%	3.98	%
Rate of increase in compensation levels	N/A		3.75	%	3.75	%
Foreign Pension Plans
Weighted-average actuarial assumptions used in determining net periodic pension expense:
Discount rate	2.76	%	2.97	%	3.82	%
Rate of increase in compensation levels	N/A		N/A		N/A
Expected long-term rate of return on assets	4.50	%	4.09	%	4.57	%
Weighted-average actuarial assumptions used in determining year-end benefit obligations:
Discount rate	3.02	%	2.76	%	2.97	%
Rate of increase in compensation levels	N/A		N/A		N/A

We review the pension assumptions annually. Pension income or expense for the year is determined using assumptions as of the beginning of the year (except for the effects of recognizing changes in the fair value of plan assets and actuarial gains and losses in the fourth quarter of each year), while the funded status is determined using assumptions as of the end of the year. We determined assumptions and established them at the respective balance sheet date using the following principles: (i) the expected long-term rate of return on plan assets is established based on forward looking long-term expectations of asset returns over the expected period to fund participant benefits based on the target investment mix of our plans; (ii) the discount rate is determined by matching the expected projected benefit obligation cash flows for each of the plans to a yield curve that is representative of long-term, high-quality (rated AA or higher) fixed income debt instruments as of the measurement date; and (iii) the rate of increase in compensation levels is established based on our expectations of current and foreseeable future increases in compensation. In addition, we consider advice from independent actuaries.

Postretirement Benefit Plans

Employer Contributions and Future Benefit Payments — Our postretirement medical plans are unfunded and have no plan assets, but are instead funded by us on a pay-as-you-go basis in the form of direct benefit payments or policy premium payments. In 2018, we made benefit payments of $8.3 to our postretirement benefit plans. Following is a summary, as of December 31, 2018, of the estimated future benefit payments for our postretirement plans in each of the next five fiscal years and in the aggregate for five fiscal years thereafter. The expected benefit payments are estimated based on the same assumptions used at December 31, 2018 to measure our obligations and include benefits attributable to estimated future employee service.



	Postretirement Payments
2019	$	8.5
2020	7.8
2021	7.1
2022	6.4
2023	5.8
Subsequent five years	22.1

Obligations and Funded Status — The following tables show the postretirement plans’ funded status and amounts recognized in our consolidated balance sheets:



	Postretirement Benefits
	2018			2017
Change in accumulated postretirement benefit obligation:
Accumulated postretirement benefit obligation — beginning of year	$	77.6		$	115.3
Interest cost	2.3			3.5
Actuarial gains	(2.3		)	(5.4		)
Benefits paid	(8.3		)	(9.0		)
Plan amendment	(0.1		)	(26.8		)
Other	(0.4		)	—
Accumulated postretirement benefit obligation — end of year	$	68.8		$	77.6
Funded status at year-end	$	(68.8	)	$	(77.6	)
Amounts recognized in the consolidated balance sheets consist of:
Accrued expenses	$	(8.3	)	$	(8.7	)
Other long-term liabilities	(60.5		)	(68.9		)
Net amount recognized	$	(68.8	)	$	(77.6	)
Amount recognized in accumulated other comprehensive income (pre-tax) consists of — net prior service credits	$	(27.1	)	$	(31.0	)

The net periodic postretirement benefit expense (income) included the following components:



	Year ended December 31,
	2018			2017			2016
Service cost	$	—		$	—		$	—
Interest cost	2.3			3.5			4.2
Amortization of unrecognized prior service credits	(4.0		)	(1.7		)	(0.8		)
Plan amendment	—			(2.6		)	—
Recognized net actuarial (gains) losses	(2.3		)	(2.8		)	0.6
Net periodic postretirement benefit expense (income)	$	(4.0	)	$	(3.6	)	$	4.0

Actuarial assumptions used in accounting for our domestic postretirement plans were as follows:



	Year ended December 31,
	2018		2017		2016
Assumed health care cost trend rates:
Health care cost trend rate for next year	7.00	%	7.25	%	7.50	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)	5.00	%	5.00	%	5.00	%
Year that the rate reaches the ultimate trend rate	2027		2027		2027
Discount rate used in determining net periodic postretirement benefit expense	3.34	%	3.60	%	3.88	%
Discount rate used in determining year-end postretirement benefit obligation	4.09	%	3.34	%	3.69	%

The accumulated postretirement benefit obligation was determined using the terms and conditions of our various plans, together with relevant actuarial assumptions and health care cost trend rates. It is our policy to review the postretirement assumptions annually. The assumptions are determined by us and are established based on our prior experience and our expectations that future health care cost trend rates will decline. In addition, we consider advice from independent actuaries.

Defined Contribution Retirement Plans

We maintain a defined contribution retirement plan (the “DC Plan”) pursuant to Section 401(k) of the U.S. Internal Revenue Code. Under the DC Plan, eligible U.S. employees may voluntarily contribute up to 50% of their compensation into the DC Plan and we match a portion of participating employees’ contributions. Our matching contributions are primarily made in newly issued shares of company common stock and are issued at the prevailing market price. The matching contributions vest with the employee immediately upon the date of the match and there are no restrictions on the resale of common stock held by employees.

Under the DC Plan, we contributed 0.279, 0.334 and 0.605 shares of our common stock to employee accounts in 2018, 2017 and 2016, respectively. Compensation expense is recorded based on the market value of shares as the shares are contributed to employee accounts. We recorded $9.4 in 2018, $8.7 in 2017 and $8.8 in 2016 as compensation expense related to the matching contribution.

Certain collectively-bargained employees participate in the DC Plan with company contributions not being made in company common stock, although company common stock is offered as an investment option under these plans.

We also maintain a Supplemental Retirement Savings Plan (“SRSP”), which permits certain members of our senior management and executive groups to defer eligible compensation in excess of the amounts allowed under the DC Plan. We match a portion of participating employees’ deferrals to the extent allowable under the SRSP provisions. The matching contributions vest with the participant immediately. Our funding of the participants’ deferrals and our matching contributions are held in certain mutual funds (as allowed under the SRSP), as directed by the participant. The fair values of these assets, which totaled $18.4 and $21.2 at December 31, 2018 and 2017, respectively, are based on quoted prices in active markets for identical assets (Level 1). In addition, the assets under the SRSP are available to the general creditors in the event of our bankruptcy and, thus, are maintained on our consolidated balance sheets within other non-current assets, with a corresponding amount in other long-term liabilities for our obligation to the participants. Lastly, these assets are accounted for as trading securities. During 2018, 2017 and 2016, we recorded compensation expense of $0.3, $0.2 and $0.7, respectively, relating to our matching contributions to the SRSP.

Income Taxes

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Income Taxes

Income from continuing operations before income taxes and the (provision for) benefit from income taxes consisted of the following:



	Year ended December 31,
	2018			2017			2016
Income (loss) from continuing operations:
United States	$	69.6		$	68.8		$	14.0
Foreign	10.0			(32.7		)	25.4
	$	79.6		$	36.1		$	39.4
(Provision for) benefit from income taxes:
Current:
United States	$	1.5		$	30.4		$	(4.3	)
Foreign	(3.2		)	(3.5		)	(4.8		)
Total current	(1.7		)	26.9			(9.1		)
Deferred and other:
United States	0.6			23.5			0.2
Foreign	(0.3		)	(2.5		)	(0.2		)
Total deferred and other	0.3			21.0			—
Total (provision) benefit	$	(1.4	)	$	47.9		$	(9.1	)

The reconciliation of income tax computed at the U.S. federal statutory tax rate to our effective income tax rate was as follows:



	Year ended December 31,
	2018		2017		2016
Tax at U.S. federal statutory rate	21.0	%	35.0	%	35.0	%
State and local taxes, net of U.S. federal benefit	2.9	%	4.4	%	5.0	%
U.S. credits and exemptions	(4.0	)%	(8.5	)%	(12.9	)%
Foreign earnings/losses taxed at different rates	(1.2	)%	(14.9	)%	(5.9	)%
Nondeductible expenses	2.6	%	2.8	%	2.2	%
Adjustments to uncertain tax positions	(8.9	)%	(9.8	)%	(1.9	)%
Changes in valuation allowance	(8.5	)%	54.4	%	17.4	%
Share-based compensation	(2.4	)%	(1.7	)%	—	%
Impairments and basis adjustments	—	%	(226.3	)%	—	%
Disposition of dry cooling business	—	%	—	%	(15.6	)%
U.S. tax reform	(0.9	)%	32.6	%	—	%
Other	1.2	%	(0.7	)%	(0.2	)%
	1.8	%	(132.7	)%	23.1	%

Significant components of our deferred tax assets and liabilities were as follows:



	As of December 31,
	2018			2017
Deferred tax assets:
NOL and credit carryforwards	$	147.6		$	146.0
Pension, other postretirement and postemployment benefits	37.1			41.2
Payroll and compensation	17.1			18.2
Legal, environmental and self-insurance accruals	22.7			25.3
Working capital accruals	12.4			11.5
Other	9.0			17.6
Total deferred tax assets	245.9			259.8
Valuation allowance	(89.3		)	(110.9		)
Net deferred tax assets	156.6			148.9
Deferred tax liabilities:
Intangible assets recorded in acquisitions	71.7			53.9
Basis difference in affiliates	12.2			3.7
Accelerated depreciation	25.2			28.8
Deferred income	18.9			4.9
Other	5.0			8.0
Total deferred tax liabilities	133.0			99.3
	$	23.6		$	49.6

The Tax Cuts and Jobs Act

As indicated in Note 1, on December 22, 2017, the Act was enacted which significantly changes U.S. income tax law for businesses. The Act introduced changes that impact U.S. corporate tax rates (e.g., a reduction in the top tax rate from 35% to 21%), business-related exclusions, and deductions and credits. In addition, the Act has tax consequences for many entities that operate internationally, including the timing and the amount of tax to be paid on undistributed foreign earnings.

As a result of the reduction in the federal corporate income tax rate and other legislative changes in the Act, we revalued our net U.S. federal deferred tax assets as of December 31, 2017, resulting in a provisional charge of $11.8 in the fourth quarter of 2017. During 2018, we completed our accounting of the impact of the Act and reduced the initial charge by $0.7 to revalue certain deferred tax assets. Further, we considered the transition tax required for the mandatory one-time “deemed repatriation” of foreign earnings and determined we have no liability in this regard due to deficits in certain of our foreign subsidiaries. We considered the accounting alternatives available related to the Act and determined we would account for Global Intangible Low-Taxed Income when incurred as a component of our “Income tax (provision) benefit.”

General Matters

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. We periodically assess deferred tax assets to determine if they are likely to be realized and the adequacy of deferred tax liabilities, incorporating the results of local, state, federal and foreign tax audits in our estimates and judgments.

At December 31, 2018, we had the following tax loss carryforwards available: federal, state, and foreign tax loss carryforwards of approximately $9.5, $588.2, and $270.5, respectively. We also had federal and state tax credit carryforwards of $42.6. Of these amounts, $9.4 expire in 2019 and $634.6 expire at various times between 2019 and 2036. The remaining carryforwards have no expiration date.

Realization of deferred tax assets, including those associated with net operating loss and credit carryforwards, is dependent upon generating sufficient taxable income in the appropriate tax jurisdiction. We believe that it is more likely than not that we may not realize the benefit of certain of these deferred tax assets and, accordingly, have established a valuation allowance against these deferred tax assets. Although realization is not assured for the remaining deferred tax assets, we believe it is more likely than not that the deferred tax assets will be realized through future taxable earnings or tax planning strategies. However, deferred tax assets could be reduced in the near term if our estimates of taxable income are significantly reduced or tax planning strategies are no longer viable. The valuation allowance decreased by $21.6 in 2018 and increased by $35.1 in 2017. The 2018 decrease was driven by foreign exchange rate changes and attributes that were utilized during the year.

The amount of income tax that we pay annually is dependent on various factors, including the timing of certain deductions. These deductions can vary from year to year, and, consequently, the amount of income taxes paid in future years will vary from the amounts paid in prior years.

Undistributed Foreign Earnings

In general, it is our practice and intention to reinvest the earnings of our non-U.S. subsidiaries in those operations. As of December 31, 2018, we have approximately $129.3 of undistributed earnings of our foreign subsidiaries. The majority of these earnings have already been reinvested in our overseas businesses. Further, we believe future domestic cash generation will be sufficient to meet future domestic cash needs. For this reason, we have not recorded a provision for U.S. or foreign withholding taxes on the excess of the amount for financial reporting over the tax basis of investments in foreign subsidiaries that are essentially permanent in duration. Generally, such amounts become subject to U.S. taxation upon the remittance of dividends and under certain other circumstances. It is not practicable to estimate the amount of a deferred tax liability related to the undistributed earnings of our foreign subsidiaries in the event that these earnings are no longer considered to be indefinitely reinvested, due to the hypothetical nature of the calculation.

Unrecognized Tax Benefits

As of December 31, 2018, we had gross and net unrecognized tax benefits of $20.3 and $13.8, respectively. Of these net unrecognized tax benefits, $10.1 would impact our effective tax rate from continuing operations if recognized. Similarly, at December 31, 2017 and 2016, we had gross unrecognized tax benefits of $31.3 (net unrecognized tax benefits of $20.6) and $37.9 (net unrecognized tax benefits of $25.2), respectively.

We classify interest and penalties related to unrecognized tax benefits as a component of our income tax (provision) benefit. As of December 31, 2018, gross accrued interest totaled $3.8 (net accrued interest of $2.9), while the related amounts as of December 31, 2017 and 2016 were $3.9 (net accrued interest of $2.5) and $3.7 (net accrued interest of $2.4), respectively. Our income tax (provision) benefit for the years ended December 31, 2018, 2017 and 2016 included gross interest income (expense) of $0.1, $(0.2) and $1.8, respectively, resulting from adjustments to our liability for uncertain tax positions. As of December 31, 2018, 2017 and 2016, we had no accrual for penalties included in our unrecognized tax benefits.

Based on the outcome of certain examinations or as a result of the expiration of statutes of limitations for certain jurisdictions, we believe that within the next 12 months it is reasonably possible that our previously unrecognized tax benefits could decrease by up to $4.0. The previously unrecognized tax benefits relate to a variety of tax matters including transfer pricing and various state matters.

The aggregate changes in the balance of unrecognized tax benefits for the years ended December 31, 2018, 2017 and 2016 were as follows:



	Year ended December 31,
	2018			2017			2016
Unrecognized tax benefit — opening balance	$	31.3		$	37.9		$	48.8
Gross increases — tax positions in prior period	0.6			1.6			3.6
Gross decreases — tax positions in prior period	(2.4		)	(0.3		)	(9.3		)
Gross increases — tax positions in current period	0.7			0.3			0.7
Settlements	—			(1.3		)	—
Lapse of statute of limitations	(9.8		)	(7.1		)	(5.9		)
Change due to foreign currency exchange rates	(0.1		)	0.2			—
Unrecognized tax benefit — ending balance	$	20.3		$	31.3		$	37.9

Other Tax Matters

During 2018, our income tax provision was impacted most significantly by (i) the utilization of $33.0 of prior years’ losses generated in foreign jurisdictions in which no tax benefit was previously recognized, (ii) $7.0 of tax benefits related to various audit settlements, statute expirations, and other adjustments to liabilities for uncertain tax positions, and (iii) $2.2 of excess tax benefits resulting from stock-based compensation awards that vested during the year.

During 2017, our income tax benefit was impacted most significantly by (i) a tax benefit of $77.6 related to a worthless stock deduction in the U.S. associated with our investment in a South African subsidiary and (ii) $4.9 of tax benefits related to various audit settlements, statute expirations, and other adjustments to liabilities for uncertain tax positions, partially offset by (iii) $11.8 of net tax charges associated with the impact of the new U.S. tax regulations described more fully above and (iv) $68.2 of foreign losses generated during the period for which no foreign tax benefit was recognized as future realization of any such foreign tax benefit is considered unlikely

During 2016, our income tax provision was impacted most significantly by (i) the $0.3 of income taxes provided in connection with the $18.4 gain that was recorded on the sale of the dry cooling business, (ii) $13.7 of foreign losses generated during the period for which no tax benefit was recognized as future realization of any such foreign tax benefit is considered unlikely, and (iii) $2.4 of tax benefits related to various audit settlements, statute expirations, and other adjustments to liabilities for uncertain tax positions.

We perform reviews of our income tax positions on a continuous basis and accrue for potential uncertain positions when we determine that a tax position meets the criteria of the Income Taxes Topic of the Codification. Accruals for these uncertain tax positions are recorded in “Income taxes payable” and “Deferred and other income taxes” in the accompanying consolidated balance sheets based on the expectation as to the timing of when the matters will be resolved. As events change and resolutions occur, these accruals are adjusted, such as in the case of audit settlements with taxing authorities.

The Internal Revenue Service (“IRS”) currently is performing an audit of our 2014, 2015, 2016 and 2017 federal income tax returns. With regard to all open tax years, we believe any contingencies are adequately provided for.

State income tax returns generally are subject to examination for a period of three to five years after filing the respective tax returns. The impact on such tax returns of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the states. We have various state income tax returns in the process of examination. We believe any uncertain tax positions related to these examinations have been adequately provided for.

We have various foreign income tax returns under examination. The most significant of these are in Germany for the 2010 through 2014 tax years. We believe that any uncertain tax positions related to these examinations have been adequately provided for.

An unfavorable resolution of one or more of the above matters could have a material adverse effect on our results of operations or cash flows in the quarter and year in which an adjustment is recorded or the tax is due or paid. As audits and examinations are still in process, the timing of the ultimate resolution and any payments that may be required for the above matters cannot be determined at this time.

Indebtedness

12 Months Ended

Dec. 31, 2018

Debt Disclosure [Abstract]

Indebtedness

The following summarizes our debt activity (both current and non-current) for the year ended December 31, 2018:



	December 31, 2017		Borrowings		Repayments			Other ⁽⁴⁾		December 31, 2018
Revolving loans	$	—	$	199.4	$	(193.0	)	$	—	$	6.4
Term loan ⁽¹⁾	347.7		—		—			0.4		348.1
Trade receivables financing arrangement ⁽²⁾	—		123.0		(100.0		)	—		23.0
Other indebtedness ⁽³⁾	9.1		14.2		(19.0		)	—		4.3
Total debt	356.8		$	336.6	$	(312.0	)	$	0.4	381.8
Less: short-term debt	7.0									31.9
Less: current maturities of long-term debt	0.5									18.0
Total long-term debt	$	349.3								$	331.9

_____________________________________________________________


⁽¹⁾	The term loan is repayable in quarterly installments of 1.25% of the initial loan amount of $350.0, beginning in the first quarter of 2019, with the remaining balance payable in full on December 19, 2022. Balances are net of unamortized debt issuance costs of $1.9 and $2.3 at December 31, 2018 and December 31, 2017, respectively.


⁽²⁾	Under this arrangement, we can borrow, on a continuous basis, up to $50.0, as available. At December 31, 2018, we had $27.0 of available borrowing capacity under this facility after giving effect to outstanding borrowings of $23.0. Borrowings under this arrangement are collateralized by eligible trade receivables of certain of our businesses.

⁽³⁾

Primarily includes balances under a purchase card program of $2.5 and $2.8, capital lease obligations of $1.8 and $2.1, and borrowings under a line of credit in China of $0.0 and $4.1, at December 31, 2018 and 2017, respectively. The purchase card program allows for payment beyond the normal payment terms for goods and services acquired under the program. As this arrangement extends the payment of these purchases beyond their normal payment terms through third-party lending institutions, we have classified these amounts as short-term debt.


⁽⁴⁾	“Other” primarily includes debt assumed, foreign currency translation on any debt instruments denominated in currencies other than the U.S. dollar, debt issuance costs incurred in connection with the term loan, and the impact of amortization of debt issuance costs associated with the term loan.

Maturities of long-term debt payable during each of the five years subsequent to December 31, 2018 are $18.0, $18.0, $17.9, $297.8, and $0.1, respectively.

Senior Credit Facilities

On December 19, 2017, we amended our senior credit agreement (the “Credit Agreement”) to, among other things, extend the term of each facility under the Credit Agreement (with the aggregate of each facility comprising the “Senior Credit Facilities”) and provide committed senior secured financing with an aggregate amount of $900.0. On November 16, 2018, we elected to reduce our participation foreign credit instrument facility commitment and our bilateral foreign credit instrument facility commitment by $35.0 and $15.0, respectively, which resulted in a reduction of our committed senior secured financing from $900.0 to $850.0. The components of our senior secured financing (each with a final maturity of December 19, 2022) were as follows as of December 31, 2018:


•	A term loan facility in an aggregate principal amount of $350.0;


•	A domestic revolving credit facility, available for loans and letters of credit, in an aggregate principal amount up to $200.0;


•	A global revolving credit facility, available for loans in Euros, GBP and other currencies, in an aggregate principal amount up to the equivalent of $150.0;


•	A participation foreign credit instrument facility, available for performance letters of credit and guarantees, in an aggregate principal amount up to the equivalent of $110.0 (previously $145.0); and


•	A bilateral foreign credit instrument facility, available for performance letters of credit and guarantees, in an aggregate principal amount up to the equivalent of $40.0 (previously $55.0).

In connection with the reduction of our foreign credit instrument facility commitments as noted above, we recorded a charge of $0.4 to “Loss on amendment/refinancing of senior credit agreement,” during the fourth quarter of 2018 associated with the write-off of the unamortized deferred financing fees related to this previously available issuance capacity of $50.0.

In connection with the December 2017 amendment of our Credit Agreement, we recorded a charge of $0.9 to “Loss on amendment/refinancing of senior credit agreement” related to the write-off of unamortized deferred financing costs.

During 2016, we reduced the issuance capacity of our foreign credit instrument facilities resulting in a charge of $1.3 to “Loss on amendment/refinancing of senior credit agreement” associated with the write-off of unamortized deferred financing costs.

The above amendment of our Credit Agreement also:

•

Adjusts the maximum aggregate amount of additional commitments we may seek, without consent of existing lenders, to add an incremental term loan facility and/or increase the commitments in respect of the domestic revolving credit facility, the global revolving credit facility, the participation foreign credit instrument facility, and/or the bilateral foreign credit instrument facility, to (i) the greater of (A) $200.0 or (B) our Consolidated EBITDA for the preceding four fiscal quarters, plus (ii) an amount equal to all voluntary prepayments of the term loan facility and the voluntary prepayments accompanied by permanent commitment reductions of revolving credit facilities and foreign credit instrument facilities, plus (iii) an unlimited amount so long as, immediately after giving effect thereto, our Consolidated Senior Secured Leverage Ratio for the prior four fiscal quarters does not exceed 2.75 to 1.00 (with the provisions described in clauses (ii) and (iii) being essentially unchanged from the previous agreement);


•	Permits unlimited investments, capital stock repurchases and dividends, and prepayments of subordinated debt if our Consolidated Leverage Ratio, after giving pro forma effect to such payments, is less than 2.75 to 1.00 (2.50 to 1.00 prior to the amendment);


•	Increases the Consolidated Leverage Ratio that we are required to maintain as of the last day of any fiscal quarter to not more than 3.50 to 1.00 (or 4.00 to 1.00 for the four fiscal quarters after certain permitted acquisitions) and included certain add-backs in the definition of consolidated EBITDA used in determining such ratio; and


•	Adjusts per annum fees charged and the interest rate margins applicable to Eurodollar and alternate base rate loans, in each case based on the Consolidated Leverage Ratio, to be as follows:



Consolidated Leverage Ratio	Domestic Revolving Commitment Fee		Global Revolving Commitment Fee		Letter of Credit Fee		Foreign Credit Commitment Fee		Foreign Credit Instrument Fee		LIBOR Rate Loans		ABR Loans
Greater than or equal to 3.00 to 1.0	0.350	%	0.350	%	2.000	%	0.350	%	1.250	%	2.000	%	1.000	%
Between 2.25 to 1.0 and 3.00 to 1.0	0.300	%	0.300	%	1.750	%	0.300	%	1.000	%	1.750	%	0.750	%
Between 1.50 to 1.0 and 2.25 to 1.0	0.275	%	0.275	%	1.500	%	0.275	%	0.875	%	1.500	%	0.500	%
Less than 1.50 to 1.0	0.250	%	0.250	%	1.375	%	0.250	%	0.800	%	1.375	%	0.375	%

We are the borrower under each of the above facilities, and certain of our foreign subsidiaries are (and we may designate other foreign subsidiaries to be) borrowers under the global revolving credit facility and the foreign credit instrument facilities. All borrowings and other extensions of credit under the Credit Agreement are subject to the satisfaction of customary conditions, including absence of defaults and accuracy in material respects of representations and warranties.

The letters of credit under the domestic revolving credit facility are stand-by letters of credit requested by SPX on behalf of any of our subsidiaries or certain joint ventures. The foreign credit instrument facility is used to issue foreign credit instruments, including bank undertakings to support our foreign operations.

The interest rates applicable to loans under the Credit Agreement are, at our option, equal to either (i) an alternate base rate (the highest of (a) the federal funds effective rate plus 0.5%, (b) the prime rate of Bank of America, N.A., and (c) the one-month LIBOR rate plus 1.0%) or (ii) a reserve-adjusted LIBOR rate for dollars (Eurodollars) plus, in each case, an applicable margin percentage as previously discussed, which varies based on our Consolidated Leverage Ratio (as defined in the Credit Agreement generally as the ratio of consolidated total debt (excluding the face amount of undrawn letters of credit, bank undertakings and analogous instruments and net of cash and cash equivalents not to exceed $150.0) at the date of determination to consolidated adjusted EBITDA for the four fiscal quarters ended most recently before such date). We may elect interest periods of one, two, three or six months (and, if consented to by all relevant lenders, twelve months) for Eurodollar borrowings.

The weighted-average interest rate of outstanding borrowings under our Senior Credit Facilities was approximately 4.3% at December 31, 2018.

The fees and bilateral foreign credit commitments are as specified above for foreign credit commitments unless otherwise agreed with the bilateral foreign issuing lender. We also pay fronting fees on the outstanding amounts of letters of credit and foreign credit instruments (in the participation facility) at the rates of 0.125% per annum and 0.25% per annum, respectively.

The Credit Agreement requires mandatory prepayments in amounts equal to the net proceeds from the sale or other disposition of, including from any casualty to, or governmental taking of, property in excess of specified values (other than in the ordinary course of business and subject to other exceptions) by SPX or our subsidiaries. Mandatory prepayments will be applied to repay, first, amounts outstanding under any term loans and, then, amounts (or cash collateralize letters of credit) outstanding under the global revolving credit facility and the domestic revolving credit facility (without reducing the commitments thereunder). No prepayment is required generally to the extent the net proceeds are reinvested (or committed to be reinvested) in permitted acquisitions, permitted investments or assets to be used in our business within 360 days (and if committed to be reinvested, actually reinvested within 180 days after the end of such 360-day period) of the receipt of such proceeds.

We may voluntarily prepay loans under the Credit Agreement, in whole or in part, without premium or penalty. Any voluntary prepayment of loans will be subject to reimbursement of the lenders’ breakage costs in the case of a prepayment of Eurodollar rate borrowings other than on the last day of the relevant interest period. Indebtedness under the Credit Agreement is guaranteed by:


•	Each existing and subsequently acquired or organized domestic material subsidiary with specified exceptions; and


•	SPX with respect to the obligations of our foreign borrower subsidiaries under the global revolving credit facility, the participation foreign credit instrument facility and the bilateral foreign credit instrument facility.

Indebtedness under the Credit Agreement is secured by a first priority pledge and security interest in 100% of the capital stock of our domestic subsidiaries (with certain exceptions) held by SPX or our domestic subsidiary guarantors and 65% of the capital stock of our material first-tier foreign subsidiaries (with certain exceptions). If SPX obtains a corporate credit rating from Moody’s and S&P and such corporate credit rating is less than “Ba2” (or not rated) by Moody’s and less than “BB” (or not rated) by S&P, then SPX and our domestic subsidiary guarantors are required to grant security interests, mortgages and other liens on substantially all of their assets. If SPX’s corporate credit rating is “Baa3” or better by Moody’s or “BBB-” or better by S&P and no defaults then exist, all collateral security is to be released and the indebtedness under the Credit Agreement would be unsecured.

The Credit Agreement requires that SPX maintain:


•	A Consolidated Interest Coverage Ratio (defined in the Credit Agreement generally as the ratio of consolidated adjusted EBITDA for the four fiscal quarters ended on such date to consolidated cash interest expense for such period) as of the last day of any fiscal quarter of at least 3.50 to 1.00; and


•	As previously discussed, a Consolidated Leverage Ratio as of the last day of any fiscal quarter of not more than 3.50 to 1.00 (or 4.00 to 1.00 for the four fiscal quarters after certain permitted acquisitions).

The Credit Agreement also contains covenants that, among other things, restrict our ability to incur additional indebtedness, grant liens, make investments, loans, guarantees, or advances, make restricted junior payments, including dividends, redemptions of capital stock, and voluntary prepayments or repurchase of certain other indebtedness, engage in mergers, acquisitions or sales of assets, enter into sale and leaseback transactions, or engage in certain transactions with affiliates, and otherwise restrict certain corporate activities. The Credit Agreement contains customary representations, warranties, affirmative covenants and events of default.

As previously discussed, we are permitted under the Credit Agreement to repurchase our capital stock and pay cash dividends in an unlimited amount if our Consolidated Leverage Ratio is (after giving pro forma effect to such payments) less than 2.75 to 1.00. If our Consolidated Leverage Ratio is (after giving pro forma effect to such payments) greater than or equal to 2.75 to 1.00, the aggregate amount of such repurchases and dividend declarations cannot exceed (A) $50.0 in any fiscal year plus (B) an additional amount for all such repurchases and dividend declarations made after the Effective Date equal to the sum of (i) $100.0 plus (ii) a positive amount equal to 50% of cumulative Consolidated Net Income (as defined in the Credit Agreement generally as consolidated net income subject to certain adjustments solely for the purposes of determining this basket) during the period from the Effective Date to the end of the most recent fiscal quarter preceding the date of such repurchase or dividend declaration for which financial statements have been (or were required to be) delivered (or, in case such Consolidated Net Income is a deficit, minus 100% of such deficit) plus (iii) certain other amounts.

At December 31, 2018, we had $311.6 of available borrowing capacity under our revolving credit facilities after giving effect to borrowings under the domestic revolving loan facility of $6.4 and $32.0 reserved for outstanding letters of credit. In addition, at December 31, 2018, we had $30.1 of available issuance capacity under our foreign credit instrument facilities after giving effect to $119.9 reserved for outstanding letters of credit.

At December 31, 2018, we were in compliance with all covenants of our Credit Agreement.

Other Borrowings and Financing Activities

Certain of our businesses purchase goods and services under a purchase card program allowing for payment beyond their normal payment terms. As of December 31, 2018 and 2017, the participating businesses had $2.5 and $2.8, respectively, outstanding under this arrangement.

We are party to a trade receivables financing agreement, whereby we can borrow, on a continuous basis, up to $50.0. Availability of funds may fluctuate over time given changes in eligible receivable balances, but will not exceed the $50.0 program limit. The facility contains representations, warranties, covenants and indemnities customary for facilities of this type. The facility does not contain any covenants that we view as materially constraining to the activities of our business.

In addition, we maintain line of credit facilities in China and South Africa available to fund operations in these regions, when necessary. At December 31, 2018, the aggregate amount of borrowing capacity under these facilities was $20.0, while the aggregate borrowings outstanding were $0.0.

Derivative Financial Instruments and Concentrations of Credit Risk	12 Months Ended
	Dec. 31, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Financial Instruments and Concentrations of Credit Risk	Derivative Financial Instruments and Concentrations of Credit Risk Interest Rate Swaps During the second quarter of 2016, we entered into interest rate swap agreements to hedge the interest rate risk on our then existing variable rate term loan. As a result of amending our Credit Agreement on December 19, 2017, these swaps (“Old Swaps”) no longer qualified for hedge accounting, resulting in a gain (recorded to “Other expense, net”) in 2017 of $2.7. On March 8, 2018, we extinguished the Old Swaps and entered into a new interest rate swap agreement (the “New Swaps”) to hedge the interest rate risk on the variable interest rate borrowings under our senior credit agreement. The New Swaps, which we have designated and are accounting for as cash flow hedges, have an initial notional amount of $260.0 and maturities through December 2021 and effectively convert a portion of the borrowings under our senior credit agreement to a fixed rate of 2.535%, plus the applicable margin. As of December 31, 2018, the aggregate notional amounts of the New Swaps was $260.0 and the unrealized gain, net of tax, recorded in AOCI was $0.2 . In addition, as of December 31, 2018 we recorded a long-term asset of $0.2 to recognize the fair value of the New Swaps. Changes in fair value for the New Swaps are reclassified into earnings as a component of interest expense, when the forecasted transaction impacts earnings. Currency Forward Contracts and Currency Forward Embedded Derivatives We manufacture and sell our products in a number of countries and, as a result, are exposed to movements in foreign currency exchange rates. Our objective is to preserve the economic value of non-functional currency-denominated cash flows and to minimize the impact of changes as a result of currency fluctuations. Our principal currency exposures relate to the South African Rand, GBP, and Euro. From time to time, we enter into forward contracts to manage the exposure on contracts with forecasted transactions denominated in non-functional currencies and to manage the risk of transaction gains and losses associated with assets/liabilities denominated in currencies other than the functional currency of certain subsidiaries (“FX forward contracts”). In addition, some of our contracts contain currency forward embedded derivatives (“FX embedded derivatives”), because the currency of exchange is not “clearly and closely” related to the functional currency of either party to the transaction. Certain of our FX forward contracts are designated as cash flow hedges. To the extent these derivatives are effective in offsetting the variability of the hedged cash flows, changes in the derivatives’ fair value are not included in current earnings, but are included in AOCI. These changes in fair value are reclassified into earnings as a component of revenues or cost of products sold, as applicable, when the forecasted transaction impacts earnings. In addition, if the forecasted transaction is no longer probable, the cumulative change in the derivatives’ fair value is recorded as a component of “Other expense, net” in the period in which the transaction is no longer considered probable of occurring. To the extent a previously designated hedging transaction is no longer an effective hedge, any ineffectiveness measured in the hedging relationship is recorded in earnings in the period in which it occurs. We had FX forward contracts with an aggregate notional amount of $14.4 and $9.0 outstanding as of December 31, 2018 and 2017, respectively, with all of the $14.4 scheduled to mature in 2019. We also had FX embedded derivatives with an aggregate notional amount of $0.4 and $1.1 at December 31, 2018 and 2017, respectively, with all of the $0.4 scheduled to mature in 2019. There were no unrealized gains or losses recorded in AOCI related to FX forward contracts as of December 31, 2018 and 2017. The net loss recorded in “Other expense, net” related to FX forward contracts and embedded derivatives totaled $0.1 in 2018, $0.4 in 2017 and $6.3 in 2016. Commodity Contracts From time to time, we enter into commodity contracts to manage the exposure on forecasted purchases of commodity raw materials. The outstanding notional amounts of commodity contracts were 3.9 and 3.6 pounds of copper at December 31, 2018 and 2017, respectively. We designate and account for these contracts as cash flow hedges and, to the extent these commodity contracts are effective in offsetting the variability of the forecasted purchases, the change in fair value is included in AOCI. We reclassify AOCI associated with our commodity contracts to cost of products sold when the forecasted transaction impacts earnings. As of December 31, 2018 and 2017, the fair values of these contracts were $1.0 (current liability) and $1.1 (current asset), respectively. The unrealized gain (loss), net of taxes, recorded in AOCI were $(0.8) and $0.8 as of December 31, 2018 and 2017, respectively. We anticipate reclassifying the unrealized loss as of December 31, 2018 to income over the next 12 months. Concentrations of Credit Risk Financial instruments that potentially subject us to significant concentrations of credit risk consist of cash and equivalents, trade accounts receivable, and interest rate swap, foreign currency forward, and commodity contracts. These financial instruments, other than trade accounts receivable, are placed with high-quality financial institutions throughout the world. We periodically evaluate the credit standing of these financial institutions. We maintain cash levels in bank accounts that, at times, may exceed federally-insured limits. We have not experienced, and believe we are not exposed to significant risk of loss in these accounts. We have credit loss exposure in the event of nonperformance by counterparties to the above financial instruments, but have no other off-balance-sheet credit risk of accounting loss. We anticipate, however, that counterparties will be able to fully satisfy their obligations under the contracts. We do not obtain collateral or other security to support financial instruments subject to credit risk, but we do monitor the credit standing of counterparties. Concentrations of credit risk arising from trade accounts receivable are due to selling to customers in a particular industry. We mitigate our credit risks by performing ongoing credit evaluations of our customers’ financial conditions and obtaining collateral, advance payments, or other security when appropriate. No one customer, or group of customers that to our knowledge are under common control, accounted for more than 10% of our revenues for any period presented.

Commitments, Contingent Liabilities and Other Matters

12 Months Ended

Dec. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments, Contingent Liabilities and Other Matters

Leases

We lease certain manufacturing facilities, offices, sales and service locations, machinery and equipment, vehicles and office equipment under various leasing programs accounted for as operating and capital leases, some of which include scheduled rent increases stated in the lease agreement. We do not have any significant leases that require rental payments based on contingent events nor have we received any significant lease incentive payments.

Operating Leases

The future minimum rental payments under operating leases with remaining non-cancelable terms in excess of one year are:



Year Ending December 31,
2019	$	9.1
2020	7.3
2021	4.5
2022	3.8
2023	3.4
Thereafter	3.1
Total minimum payments	$	31.2

Total operating lease expense, inclusive of rent based on scheduled rent increases and rent holidays recognized on a straight-line basis, was $13.3 in 2018, $12.9 in 2017 and $13.2 in 2016.

Spin-Off of SPX FLOW

In connection with the Spin-Off, we entered into definitive agreements with SPX FLOW that, among other matters, set forth the terms and conditions of the Spin-Off and provide a framework for our relationship with SPX FLOW after the Spin-Off, including the following:


•	Separation and Distribution Agreement;


•	Tax Matters Agreement;


•	Employee Matters Agreement; and


•	Trademark License Agreement.

Pursuant to the Separation and Distribution Agreement, the Employee Matters Agreement and the Tax Matters Agreement, SPX FLOW has agreed to indemnify us for certain liabilities, and we have agreed to indemnify SPX FLOW for certain liabilities, in each case for uncapped amounts. As of December 31, 2018, no material indemnification claims have been initiated.

The financial activity governed by these agreements between SPX FLOW and us was not material to our consolidated financial results for the years ended December 31, 2018, 2017 and 2016.

We also entered into a five-year agreement with SPX FLOW to lease office space for our corporate headquarters. Annual lease costs associated with the agreement are $2.1.

General

Numerous claims, complaints and proceedings arising in the ordinary course of business have been asserted or are pending against us or certain of our subsidiaries (collectively, “claims”). These claims relate to litigation matters (e.g., class actions, derivative lawsuits and contracts, intellectual property and competitive claims), environmental matters, product liability matters (predominately associated with alleged exposure to asbestos-containing materials), and other risk management matters (e.g., general liability, automobile, and workers’ compensation claims). Additionally, we may become subject to other claims of which we are currently unaware, which may be significant, or the claims of which we are aware may result in our incurring significantly greater loss than we anticipate. While we (and our subsidiaries) maintain property, cargo, auto, product, general liability, environmental, and directors’ and officers’ liability insurance and have acquired rights under similar policies in connection with acquisitions that we believe cover a significant portion of these claims, this insurance may be insufficient or unavailable (e.g., in the case of insurer insolvency) to protect us against potential loss exposures. Also, while we believe we are entitled to indemnification from third parties for some of these claims, these rights may be insufficient or unavailable to protect us against potential loss exposures.

Our recorded liabilities related to these matters totaled $631.7 (including $587.5 for asbestos product liability matters) and $685.7 (including $641.2 for asbestos product liability matters) at December 31, 2018 and 2017, respectively. Of these amounts, $600.3 and $651.6 are included in “Other long-term liabilities” within our consolidated balance sheets at December 31, 2018 and 2017, respectively, with the remainder included in “Accrued expenses.” The liabilities we record for these claims are based on a number of assumptions, including historical claims and payment experience and, with respect to asbestos claims, actuarial estimates of the future period during which additional claims are reasonably foreseeable. While we base our assumptions on facts currently known to us, they entail inherently subjective judgments and uncertainties. As a result, our current assumptions for estimating these liabilities may not prove accurate, and we may be required to adjust these liabilities in the future, which could result in charges to earnings. These variances relative to current expectations could have a material impact on our financial position and results of operations.

Our asbestos-related claims are typical in certain of the industries in which we operate or pertain to legacy businesses we no longer operate. It is not unusual in these cases for fifty or more corporate entities to be named as defendants. We vigorously defend these claims, many of which are dismissed without payment, and the significant majority of costs related to these claims have historically been paid pursuant to our insurance arrangements. During the years ended December 31, 2018, 2017 and 2016, our payments for asbestos-related matters, net of insurance recoveries of $45.3, $57.3, and $46.7, were $9.7, $1.0 and $5.8, respectively. A significant increase in claims, costs and/or issues with existing insurance coverage (e.g., dispute with or insolvency of insurer(s)) could have a material adverse impact on our share of future payments related to these matters, and, as a result, have a material impact on our financial position, results of operations and cash flows.

We have recorded insurance recovery assets associated with the asbestos product liability matters, with such amounts totaling $541.9 and $590.9 at December 31, 2018 and 2017, respectively, and included in “Other assets” within our consolidated balance sheets. These assets represent amounts that we believe we are or will be entitled to recover under agreements we have with insurance companies. The assets we record for these insurance recoveries are based on a number of assumptions, including the continued solvency of the insurers, and are subject to a variety of uncertainties. Our current assumptions for estimating these assets may not prove accurate, and we may be required to adjust these assets in the future, which could result in additional charges to earnings. These variances relative to current expectations could have a material impact on our financial position and results of operations.

During the years ended December 31, 2018, 2017, and 2016, we recorded charges of $2.4, $5.7, and $4.9, respectively, as a result of changes in estimates associated with the liabilities and assets related to asbestos product liability matters. Of these charges, $2.0, $3.5 and $4.2 were recorded to “Other expense, net” for the years ended December 31, 2018, 2017, and 2016, respectively, and $0.4, $2.2, and $0.7, respectively, to “Gain (loss) on disposition of discontinued operations, net of tax.”

Large Power Projects in South Africa

Overview - Since 2008, DBT has been executing contracts on two large power projects in South Africa. Over such time, the business environment surrounding these projects has been difficult, as DBT has experienced delays, cost over-runs, and various other challenges associated with a complex set of contractual relationships among the end customer, prime contractors, various subcontractors (including DBT and its subcontractors), and various suppliers. These challenges have resulted in (i) significant adjustments to our revenue and cost estimates for the projects and (ii) various claims and disputes between DBT and other parties involved with the projects (e.g., prime contractors, subcontractors, suppliers, etc.). We believe that our probable liability associated with known claims has been adequately provided for in our consolidated financial statements. We may become subject to other claims, which could be significant. DBT has completed the majority of its contractual scope on the projects and is targeting to complete the remainder by the end of 2019. It is possible that certain of the outstanding claims could be resolved in 2019, while others are not likely to be resolved until after DBT completes its remaining scope. Our future financial position, operating results, and cash flows could be impacted by the resolution of current and any future claims, as well as potential changes to revenue and cost estimates relating to the execution of DBT’s remaining scope.

Claims Activity - On February 15, 2019, DBT received a claim of South African Rand 116.7 (or $8.0) from one of its prime contractors on the projects alleging that DBT failed to meet a specific contract milestone. We believe that DBT has numerous defenses against this allegation and, thus, we do not believe that we have a probable liability associated with the claim. As such, no amount has been reflected in the accompanying consolidated financial statements for this matter.

DBT has made various claims against the prime contractors for the projects. We have recognized revenue associated with these claims, along with certain unapproved change orders, to the extent the related costs have been incurred and the amount expected of recovery is probable and reasonably estimable. As of December 31, 2018, the recorded cumulative revenues related to these claims and unapproved change orders totaled $37.9. We believe these amounts are recoverable under the provisions of the related contracts and reflect our best estimate of recoverable amounts.

On October 30, 2018, a non-governmental business adjudicator in South Africa provided a decision on certain claims made against DBT by one of its subcontractors. As part of its decision, the adjudicator concluded that the subcontractor was entitled to payment of South African Rand 256.0 (or $17.7). We believe that the decision is invalid on numerous bases. Therefore, DBT intends to pursue all available legal recourse in the matter and DBT has already referred the matter to both an arbitration process and court proceedings. Specifically, we believe, among other things, that (i) the adjudicator lacked jurisdiction to decide the claims and (ii) these and other claims were previously settled and satisfied by way of a 2015 amendment to the contract between DBT and the subcontractor. Based on the reasons stated above, we have concluded that it is not probable that a loss has been incurred with respect to this matter and, therefore, a liability has not been recorded in our consolidated financial statements.

It is possible that an adverse result for any of these disputes could have a material effect on our consolidated financial statements.

Change in Cost Estimates - During 2017, we experienced higher than expected costs associated with (i) DBT’s efforts to accelerate completion of certain scopes of work, (ii) financial and other challenges facing certain of DBT’s subcontractors, and (iii) delays and other on-site productivity challenges. As a result, during the second and fourth quarters of 2017, we revised our estimates of revenues and costs associated with the projects. These revisions resulted in aggregate charges to “Income (loss) from continuing operations before income taxes” of $52.8 during 2017 ($22.9 and $29.9 during the second and fourth quarters of 2017, respectively), which is comprised of a reduction in revenue of $36.9 ($13.5 and $23.4 during the second and fourth quarters of 2017, respectively) and an increase in cost of products sold of $15.9 ($9.4 and $6.5 during the second and fourth quarters of 2017, respectively).

Although we believe that our current estimates of revenues and costs relating to these projects are reasonable, it is possible that future revisions of such estimates could have a material effect on our consolidated financial statements.

Noncontrolling Interest in South African Subsidiary

DBT has a Black Economic Empowerment shareholder (the “BEE Partner”) that holds a 25.1% noncontrolling interest in DBT. Under the terms of the shareholder agreement between the BEE Partner and SPX Technologies (PTY) LTD (“SPX Technologies”), the BEE Partner had the option to put its ownership interest in DBT to SPX Technologies, the majority shareholder of DBT, at a redemption amount determined in accordance with the terms of the shareholder agreement (the “Put Option”). The BEE Partner notified SPX Technologies of its intention to exercise the Put Option and, on July 6, 2016, an Arbitration Tribunal declared that the BEE Partner was entitled to South African Rand 287.3 in connection with the exercise of the Put Option, having not considered an amount due from the BEE Partner under a promissory note of South African Rand 30.3 held by SPX Technologies. As a result, we have reflected the net redemption amount of South African Rand 257.0 (or $17.7 and $20.9 at December 31, 2018 and 2017, respectively) within “Accrued expenses” on our consolidated balance sheets as of December 31, 2018 and 2017, with the related offset recorded to “Paid-in capital” and “Accumulated other comprehensive income.” In addition, during 2016 we reclassified $38.7 from “Noncontrolling Interests” to “Paid-in capital.” Lastly, under the two-class method of calculating earnings per share, we have reflected an adjustment of $18.1 to “Net income (loss) attributable to SPX Corporation common shareholders” for the excess redemption amount of the Put Option (i.e., the increase in the redemption amount during the year ended December 31, 2016 in excess of fair value) in our calculations of basic and diluted earnings per share for the year ended December 31, 2016.

In August 2016, SPX Technologies applied to the High Court of South Africa (the “Court”) to have the Arbitration Tribunal’s ruling set aside. On January 22, 2018, the Court ruled in SPX Technologies favor and set aside the Arbitration Tribunal’s ruling. This ruling by the Court is subject to appeal by the BEE Partner. The BEE Partner appealed the decision and SPX Technologies continues to assert all legal defenses available to it. We expect the appeals court to hear this matter in late 2019.

Beginning in the third quarter of 2016, in connection with our accounting for the redemption of the BEE partner’s ownership interest in DBT, we discontinued allocating earnings/losses of DBT to the BEE Partner within our consolidated financial statements.

Litigation Matters

We are subject to other legal matters that arise in the normal course of business. We believe these matters are either without merit or of a kind that should not have a material effect, individually or in the aggregate, on our financial position, results of operations or cash flows; however, we cannot assure you that these proceedings or claims will not have a material effect on our financial position, results of operations or cash flows.

Environmental Matters

Our operations and properties are subject to federal, state, local and foreign regulatory requirements relating to environmental protection. It is our policy to comply fully with all applicable requirements. As part of our effort to comply, we have a comprehensive environmental compliance program that includes environmental audits conducted by internal and external independent professionals, as well as regular communications with our operating units regarding environmental compliance requirements and anticipated regulations. Based on current information, we believe that our operations are in substantial compliance with applicable environmental laws and regulations, and we are not aware of any violations that could have a material effect, individually or in the aggregate, on our business, financial condition, and results of operations or cash flows. As of December 31, 2018, we had liabilities for site investigation and/or remediation at 28 sites (28 sites at December 31, 2017) that we own or control. In addition, while we believe that we maintain adequate accruals to cover the costs of site investigation and/or remediation, we cannot provide assurance that new matters, developments, laws and regulations, or stricter interpretations of existing laws and regulations will not materially affect our business or operations in the future.

Our environmental accruals cover anticipated costs, including investigation, remediation, and operation and maintenance of clean-up sites. Our estimates are based primarily on investigations and remediation plans established by independent consultants, regulatory agencies and potentially responsible third parties. Accordingly, our estimates may change based on future developments, including new or changes in existing environmental laws or policies, differences in costs required to complete anticipated actions from estimates provided, future findings of investigation or remediation actions, or alteration to the expected remediation plans. It is our policy to revise an estimate once it becomes probable and the amount of change can be reasonably estimated. We generally do not discount our environmental accruals and do not reduce them by anticipated insurance recoveries. We take into account third-party indemnification from financially viable parties in determining our accruals where there is no dispute regarding the right to indemnification.

In the case of contamination at offsite, third-party disposal sites, as of December 31, 2018, we have been notified that we are potentially responsible and have received other notices of potential liability pursuant to various environmental laws at 14 sites (15 sites at December 31, 2017) at which the liability has not been settled, of which 10 sites have been active in the past few years. These laws may impose liability on certain persons that are considered jointly and severally liable for the costs of investigation and remediation of hazardous substances present at these sites, regardless of fault or legality of the original disposal. These persons include the present or former owners or operators of the site and companies that generated, disposed of or arranged for the disposal of hazardous substances at the site. We are considered a “de minimis” potentially responsible party at most of the sites, and we estimate that our aggregate liability, if any, related to these sites is not material to our consolidated financial statements. We conduct extensive environmental due diligence with respect to potential acquisitions, including environmental site assessments and such further testing as we may deem warranted. If an environmental matter is identified, we estimate the cost and either establish a liability, purchase insurance or obtain an indemnity from a financially sound seller; however, in connection with our acquisitions or dispositions, we may assume or retain significant environmental liabilities, some of which we may be unaware. The potential costs related to these environmental matters and the possible impact on future operations are uncertain due in part to the complexity of government laws and regulations and their interpretations, the varying costs and effectiveness of various clean-up technologies, the uncertain level of insurance or other types of recovery, and the questionable level of our responsibility. We record a liability when it is both probable and the amount can be reasonably estimated.

In our opinion, after considering accruals established for such purposes, the cost of remedial actions for compliance with the present laws and regulations governing the protection of the environment is not expected to have a material impact, individually or in the aggregate, on our financial position, results of operations or cash flows.

Self-Insured Risk Management Matters

We are self-insured for certain of our workers’ compensation, automobile, product and general liability, disability and health costs, and we believe that we maintain adequate accruals to cover our retained liability. Our accruals for risk management matters are determined by us, are based on claims filed and estimates of claims incurred but not yet reported, and generally are not discounted. We consider a number of factors, including third-party actuarial valuations, when making these determinations. We maintain third-party stop-loss insurance policies to cover certain liability costs in excess of predetermined retained amounts. This insurance may be insufficient or unavailable (e.g., because of insurer insolvency) to protect us against loss exposure.

Executive Agreements

The Board of Directors has approved an employment agreement for our President and Chief Executive Officer. This agreement had an initial term through December 31, 2017 and, thereafter, rolling terms of one year, and specifies the executive’s current compensation, benefits and perquisites, severance entitlements, and other employment rights and responsibilities. The Compensation Committee of the Board of Directors has approved severance benefit agreements for our other six executive officers. These agreements cover each executive’s entitlements in the event that the executive’s employment is terminated for other than cause, death or disability, or the executive resigns with good reason. The Compensation Committee of the Board of Directors has also approved change of control agreements for each of our executive officers, which cover each executive’s entitlements following a change of control.

Shareholders' Equity and Long-Term Incentive Compensation

12 Months Ended

Dec. 31, 2018

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION

Shareholders' Equity and Long-Term Incentive Compensation

Shareholders’ Equity and Long-Term Incentive Compensation

Income (Loss) Per Share

The following table sets forth the computations of the components used for the calculation of basic and diluted income (loss) per share:



	Year ended December 31,
	2018		2017		2016
Numerator:
Income from continuing operations	$	78.2	$	84.0	$	30.3
Less: Net loss attributable to noncontrolling interests	—		—		(0.4		)
Adjustment related to redeemable noncontrolling interest (Note 14)	—		—		(18.1		)
Income from continuing operations attributable to SPX Corporation common shareholders for calculating basic and diluted income per share	$	78.2	$	84.0	$	12.6
Income (loss) from discontinued operations, net of tax	$	3.0	$	5.3	$	(97.9	)
Less: Net loss attributable to noncontrolling interest	—		—		—
Income (loss) from discontinued operations attributable to SPX Corporation common shareholders for calculating basic and diluted income per share	$	3.0	$	5.3	$	(97.9	)
Denominator:
Weighted-average number of common shares used in basic income (loss) per share	43.054		42.413		41.610
Dilutive securities — Employee stock options, restricted stock shares and restricted stock units	1.606		1.492		0.551
Weighted-average number of common shares and dilutive securities used in diluted income (loss) per share	44.660		43.905		42.161

For the years ended December 31, 2018, 2017, and 2016, 0.234, 0.563, and 1.045 of unvested restricted stock shares/units, respectively, were excluded from the computation of diluted earnings per share as the assumed proceeds for these instruments exceeded the average market value of the underlying common stock for the related years. For the years ended December 31, 2018, 2017, and 2016, 0.875, 0.997, and 1.343, respectively, of outstanding stock options were excluded from the computation of diluted earnings per share as the assumed proceeds for these instruments exceeded the average market value of the underlying common stock for the related years.

Common Stock and Treasury Stock

At December 31, 2018, we had 200.0 authorized shares of common stock (par value $0.01). Common shares issued, treasury shares and shares outstanding are summarized in the table below.



	Common Stock Issued		Treasury Stock		Shares Outstanding
December 31, 2015	100.526		(59.110	)	41.416
Restricted stock shares and restricted stock units	0.042		0.295		0.337
Retirement of treasury stock	(50.000	)	50.000		—
Other	0.187		—		0.187
December 31, 2016	50.755		(8.815	)	41.940
Restricted stock units	—		0.280		0.280
Other	0.431		—		0.431
December 31, 2017	51.186		(8.535	)	42.651
Restricted stock units	—		0.457		0.457
Other	0.343		—		0.343
December 31, 2018	51.529		(8.078	)	43.451

In 2016, we retired 50.0 shares or $2,948.1 of “Common stock in treasury.” Under the applicable state law, these shares represent authorized and unissued shares upon retirement. In accordance with our accounting policy, we allocate any excess of share repurchase over par value between “Paid-in capital” and “Retained deficit,” which resulted in respective adjustments of $1,285.4 and $1,662.2.

Long-Term Incentive Compensation

Under the 2002 Stock Compensation Plan, as amended in 2006, 2011, 2012 and 2015, up to 1.683 shares of our common stock were available for grant at December 31, 2018. The 2002 Stock Compensation Plan permits the issuance of new shares or shares from treasury upon the exercise of options, vesting of time-based restricted stock units (“RSU’s”) and performance stock units (“PSU’s”), or the granting of restricted stock shares (“RS’s”). Each RSU and RS granted reduces availability by two shares. Each PSU granted in 2018 reduces availability by its maximum vesting attainment of 150%, or 3.0 shares.

PSU’s, RSU’s and RS’s may be granted to certain eligible employees or non-employee directors in accordance with applicable equity compensation plan documents and agreements. Subject to participants’ continued employment and other plan terms and conditions, the restrictions lapse and awards generally vest over a period of time, generally one or three years. In some instances, such as death, disability, or retirement, stock may vest concurrently with or following an employee’s termination. PSU’s are eligible to vest at the end of the performance period, with performance based on the total return of our stock over the three-year performance period against a peer group within the S&P 600 Capital Goods Index, while the RSU’s and RS’s vest based on the passage of time since grant date. PSU’s, RSU’s, and RS’s that do not vest within the applicable vesting period are forfeited.

We grant RSU’s or RS’s to non-employee directors under the 2006 Non-Employee Directors’ Stock Incentive Plan (the “Directors’ Plan”) and the 2002 Stock Compensation Plan. Under the Directors’ Plan, up to 0.027 shares of our common stock were available for grant at December 31, 2018. The 2018, 2017 and 2016 grants to non-employee directors generally vest over a one-year vesting period, with the 2018 grants scheduled to vest in their entirety immediately prior to the annual meeting of stockholders in May 2019.

Stock options may be granted to key employees in the form of incentive stock options or nonqualified stock options. The option price per share may be no less than the fair market value of our common stock at the close of business the day prior to the date of grant. Upon exercise, the employee has the option to surrender previously owned shares at current value in payment of the exercise price and/or for withholding tax obligations.

The recognition of compensation expense for share-based awards, including stock options, is based on their grant date fair values. The fair value of each award is amortized over the lesser of the award’s requisite or derived service period, which is generally up to three years. Compensation expense within income from continuing operations related to PSU’s, RSU’s, RS’s and stock options totaled $11.6, $12.0 and $12.7 for the years ended December 31, 2018, 2017 and 2016, respectively, with the related tax benefit being $2.8, $4.6 and $4.8 for the years ended December 31, 2018, 2017 and 2016, respectively.

During 2018, 2017, and 2016 long-term cash awards were granted to executive officers and other members of senior management. These awards are eligible to vest at the end of a three-year performance measurement period, with performance based on our achievement of a target segment income amount over the three-year measurement period. Long-term incentive compensation expense for 2018, 2017, and 2016 included $3.9, $3.8 and $1.0, respectively associated with long-term cash awards.

We use the Monte Carlo simulation model valuation technique to determine fair value of our restricted stock awards that contain a market condition (i.e., the PSU’s). The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award and calculates the fair value of each PSU. We issued PSU’s to eligible participants on February 22, 2018, March 1, 2017, and March 2, 2016. We used the following assumptions in determining the fair value of these awards:



	Annual Expected Stock Price Volatility		Annual Expected Dividend Yield		Risk-Free Interest Rate		Correlation Between Total Shareholder Return for SPX and the Applicable S&P Index
February 22, 2018
SPX Corporation	42.25	%	—	%	2.38	%	0.3267
Peer group within S&P 600 Capital Goods Index	34.99	%	n/a		2.38	%
March 1, 2017
SPX Corporation	41.03	%	—	%	1.52	%	0.3685
Peer group within S&P 600 Capital Goods Index	34.49	%	n/a		1.52	%
March 2, 2016
SPX Corporation	36.91	%	—	%	0.97	%	0.3354
Peer group within S&P 600 Capital Goods Index	32.94	%	n/a		0.97	%

Annual expected stock price volatility is based on the three-year historical volatility. There is no annual expected dividend yield as we discontinued dividend payments in 2015 and do not expect to pay dividends for the foreseeable future. The average risk-free interest rate is based on the one-year through three-year daily treasury yield curve rate as of the grant date.

The following table summarizes the PSU, RSU, and RS activity from December 31, 2015 through December 31, 2018:



	Unvested PSU’s, RSU’s, and RS’s		Weighted-Average Grant-Date Fair Value Per Share
December 31, 2015	1.869		$	17.63
Granted	0.423		13.97
Vested	(0.528	)	10.32
Forfeited	(0.062	)	20.46
December 31, 2016	1.702		16.47
Granted	0.252		28.22
Vested	(0.483	)	18.17
Forfeited	(0.241	)	20.83
December 31, 2017	1.230		17.41
Granted	0.211		33.69
Vested	(0.753	)	15.39
Forfeited	(0.036	)	22.35
December 31, 2018	0.652		$	24.65

As of December 31, 2018, there was $5.7 of unrecognized compensation cost related to PSU’s, RSU’s and RS’s. We expect this cost to be recognized over a weighted-average period of 1.7 years.

Stock Options

On February 22, 2018, March 1, 2017 and March 2, 2016, we granted stock options totaling 0.184, 0.208 and 0.505, respectively. The exercise price per share of these options is $32.69, $27.40 and $12.85, respectively, and the maximum contractual term of these options is ten years.

The fair value of each stock option granted on February 22, 2018, March 1, 2017 and March 2, 2016 was $11.66, $9.60 and $4.11, respectively. The fair value of each option grant was estimated using a Black-Scholes option-pricing model with the following assumptions:



	February 22, 2018		March 1, 2017		March 2, 2016
Annual expected stock price volatility	31.14	%	32.00	%	30.06	%
Annual expected dividend yield	—	%	—	%	—	%
Risk-free interest rate	2.75	%	2.14	%	1.50	%
Expected life of stock option (in years)	6.0		6.0		6.0

Annual expected stock price volatility for the February 22, 2018, March 1, 2017 and March 2, 2016 grant were based on a weighted average of SPX’s stock volatility since the Spin-Off and an average of the most recent six-year historical volatility of a peer company group. There is no annual expected dividend yield as we discontinued dividend payments in 2015 and do not expect to pay dividends for the foreseeable future. The average risk-free interest rate is based on the five-year and seven-year treasury constant maturity rates. The expected option life is based on a three-year pro-rata vesting schedule and represents the period of time that awards are expected to be outstanding.

The following table shows stock option activity from December 31, 2015 through December 31, 2018.



	Shares		Weighted- Average Exercise Price
Options outstanding at December 31, 2015	1.047		$	12.91
Granted	0.505		12.85
Options outstanding at December 31, 2016	1.552		12.89
Exercised	(0.125	)	20.67
Forfeited	(0.027	)	14.45
Granted	0.208		27.40
Options outstanding at December 31, 2017	1.608		14.67
Exercised	(0.064	)	13.89
Forfeited	(0.010	)	23.17
Granted	0.184		32.69
Options outstanding at December 31, 2018	1.718		$	16.58

As of December 31, 2018, 1.242 of the above stock options were exercisable and there was $1.4 of unrecognized compensation cost related to the outstanding stock options. We expect this cost to be recognized over a weighted-average period of 1.9 years.

Accumulated Other Comprehensive Income

The changes in the components of accumulated other comprehensive income, net of tax, for the year ended December 31, 2018 were as follows:



	Foreign Currency Translation Adjustment			Net Unrealized Gains on Qualifying Cash Flow Hedges⁽¹⁾			Pension and Postretirement Liability Adjustment and Other⁽²⁾			Total
Balance at December 31, 2017	$	230.2		$	0.8		$	19.1		$	250.1
Other comprehensive loss before reclassifications	(4.4		)	(1.8		)	(1.0		)	(7.2		)
Amounts reclassified from accumulated other comprehensive income:
Impact of initial adoption of ASC 606 - See Note 3	—			(0.3		)	—			(0.3		)
Stranded income tax effects resulting from tax reform - See Note 3	—			0.2			4.6			4.8
Commodity contracts and amortization of prior service credits - See below	—			0.5			(3.0		)	(2.5		)
Current-period other comprehensive income (loss)	(4.4		)	(1.4		)	0.6			(5.2		)
Balance at December 31, 2018	$	225.8		$	(0.6	)	$	19.7		$	244.9

___________________________________________________________________


⁽¹⁾	Net of tax (provision) benefit of $0.2 and $(0.5) as of December 31, 2018 and 2017, respectively.

⁽²⁾Net of tax provision of $6.6 and $12.5 as of December 31, 2018 and 2017, respectively. The balances as of December 31, 2018 and 2017 include unamortized prior service credits.

The changes in the components of accumulated other comprehensive income, net of tax, for the year ended December 31, 2017 were as follows:



	Foreign Currency Translation Adjustment		Net Unrealized Losses on Qualifying Cash Flow Hedges(3)			Pension and Postretirement Liability Adjustment and Other(1)(4)			Total
Balance at December 31, 2016	$	229.7	$	1.5		$	3.9		$	235.1
Other comprehensive income before reclassifications ⁽¹⁾	0.5		2.3			16.3			19.1
Amounts reclassified from accumulated other comprehensive income ⁽²⁾	—		(3.0		)	(1.1		)	(4.1		)
Current-period other comprehensive income (loss)	0.5		(0.7		)	15.2			15.0
Balance at December 31, 2017	$	230.2	$	0.8		$	19.1		$	250.1

___________________________________________________________________


⁽¹⁾	As indicated in Note 10, we reduced our unfunded liability related to postretirement benefits and increased “Accumulated other comprehensive income” (before tax) by $26.8.


⁽²⁾	As indicated in Note 13, we discontinued hedge accounting for our Swaps resulting in a reclassification from “Accumulated other comprehensive income” (before tax) of $2.7.


⁽³⁾	Net of tax provision of $0.5 and $0.9 as of December 31, 2017 and 2016, respectively.


⁽⁴⁾	Net of tax provision of $12.5 and $2.7 as of December 31, 2017 and 2016, respectively. The balances as of December 31, 2017 and 2016 include unamortized prior service credits.

The following summarizes amounts reclassified from each component of accumulated comprehensive income for the years ended December 31, 2018 and 2017:



	Amount Reclassified from AOCI						Affected Line Items in the Consolidated Statements of Operations
	Year ended December 31,
	2018			2017
(Gains) losses on qualifying cash flow hedges:
Commodity contracts	$	0.7		$	(2.5	)	Cost of products sold
Swaps	—			0.3			Interest expense
Swaps	—			(2.7		)	Other expense, net
Pre-tax	0.7			(4.9		)
Income taxes	(0.2		)	1.9
	$	0.5		$	(3.0	)
Pension and postretirement items:
Amortization of unrecognized prior service credits - Pre-tax	$	(4.2	)	$	(1.8	)	Other expense, net
Income taxes	1.2			0.7
	$	(3.0	)	$	(1.1	)

Common Stock in Treasury

As described above, in 2016, we retired 50.0 shares or $2,948.1 of “Common stock in treasury.” In addition, during the years ended December 31, 2018, 2017 and 2016, “Common stock in treasury” was decreased by the settlement of restricted stock units issued from treasury stock of $27.6, $16.9 and $17.9, respectively.

Preferred Stock

None of our 3.0 shares of authorized no par value preferred stock was outstanding at December 31, 2018, 2017 or 2016.

Fair Value

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Fair Value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In the absence of active markets for the identical assets or liabilities, such measurements involve developing assumptions based on market observable data and, in the absence of such data, internal information consistent with what market participants would use in a hypothetical transaction that occurs at the measurement date. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect our market assumptions. Preference is given to observable inputs. These two types of inputs create the following fair value hierarchy:


•	Level 1 — Quoted prices for identical instruments in active markets.


•	Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.


•	Level 3 — Significant inputs to the valuation model are unobservable.

There were no changes during the periods presented to the valuation techniques we use to measure asset and liability fair values on a recurring basis. There were no transfers between the three levels of the fair value hierarchy for the periods presented.

Valuation Methodologies Used to Measure Fair Value on a Non-Recurring Basis

Parent Guarantees and Bonds Associated with Balcke Dürr — As indicated in Note 4, in connection with the sale of Balcke Dürr, existing parent company guarantees and bank and surety bonds, which totaled approximately Euro 79.0 and Euro 79.0, respectively, at the time of sale (and Euro 31.7 and Euro 21.8, respectively, at December 31, 2018), will remain in place through each instrument’s expiration date, with such expiration dates occurring through 2022. These guarantees and bonds provide protections for Balcke Dürr customers in regard to advance payments, performance, and warranties on projects in existence at the time of sale. In addition, certain bonds relate to lease obligations and foreign tax matters in existence at the time of sale. Balcke Dürr and the Buyer have provided us an indemnity in the event that any of these bonds are called. Also, at the time of sale, Balcke Dürr provided cash collateral of Euro 4.0 and mutares AG provided a guarantee of Euro 5.0 as a security for the above indemnifications (Euro 3.0 and Euro 5.0, respectively, at December 31, 2018). Summarized below are the liability (related to the parent company guarantees and bank and surety bonds) and asset (related to the cash collateral and guarantee provided by mutares AG) recorded at the time of sale, along with the change in the liability and the asset during 2018 and 2017.



	Twelve months ended
	December 31, 2018						December 31, 2017
	Guarantees and Bonds Liability ⁽¹⁾			Indemnification Assets ⁽¹⁾			Guarantees and Bonds Liability ⁽¹⁾			Indemnification Assets ⁽¹⁾
Balance at beginning of year	$	8.7		$	2.8		$	9.9		$	4.8
Reduction/Amortization for the period ⁽²⁾	(4.1		)	(1.5		)	(2.5		)	(2.6		)
Impact of changes in foreign currency rates	(0.2		)	(0.1		)	1.3			0.6
Balance at end of period ⁽³⁾	$	4.4		$	1.2		$	8.7		$	2.8

___________________________

⁽¹⁾

In connection with the sale, we estimated the fair value of the existing parent company guarantees and bank and surety bonds considering the probability of default by Balcke Dürr and an estimate of the amount we would be obligated to pay in the event of a default. Additionally, we estimated the fair value of the cash collateral provided by Balcke Dürr and the guarantee provided by mutares AG based on the terms and conditions and relative risk associated with each of these securities (unobservable inputs - Level 3).


⁽²⁾	We reduce the liability generally at the earlier of the completion of the related underlying project milestones or the expiration of the guarantees or bonds. We amortize the asset based on the expiration terms of each of the securities. We record the reduction of the liability and the amortization of the asset to “Other expense, net.”


⁽³⁾	Balance associated with the guarantees and bonds is reflected within “Other long-term liabilities,” while the balance associated with the indemnification assets is reflected within “Other assets.”

The net loss recorded at the time of sale of $78.6 included a charge of $5.1 associated with the estimated fair value of the guarantees and bonds, after consideration of the cash collateral and guarantee provided by Balcke Dürr and mutares AG, respectively.

Goodwill, Indefinite-Lived Intangible and Other Long-Lived Assets — Certain of our non-financial assets are subject to impairment analysis, including long-lived assets, indefinite-lived intangible assets and goodwill. We review the carrying amounts of such assets whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable or at least annually for indefinite-lived intangible assets and goodwill. Any resulting asset impairment would require that the instrument be recorded at its fair value. As of December 31, 2018, we did not have any significant non-financial assets or liabilities that are required to be measured at fair value on a recurring or non-recurring basis.

During the fourth quarter of 2016, we concluded that the carrying value of our Heat Transfer business’s definite-lived intangible assets (customer relationships and technology) may not be recoverable. As a result, we performed an impairment analysis on such assets. Based on such analysis, we determined that the fair values of these assets were less than their respective carrying values, resulting in an aggregate impairment charge of $23.9. The fair value of the customer relationship intangible asset was based on the estimated future cash flows of the asset, discounted at a rate of return that reflected the relative risk of the cash flows (unobservable inputs - Level 3). The fair values for the technology intangible assets were based on applying estimated royalty rates to projected revenues associated with the assets, discounted at a rate of return that reflected the relative risk of the revenues and current market conditions (unobservable inputs - Level 3).

We perform our annual trademarks impairment testing during the fourth quarter, or on a more frequent basis if there are indications of potential impairment. The fair values of our trademarks are determined by applying estimated royalty rates to projected revenues, with the resulting amount discounted at a rate of return that reflects the relative risk of the revenues and current market conditions (fair value based on unobservable inputs - Level 3, as defined above). Based on our annual impairment testing during the fourth quarter of 2016, we recorded an impairment charge associated with Heat Transfer’s trademarks of $2.2. In addition, we recorded impairment charges of $4.0 during the first quarter of 2016 associated with Heat Transfer’s trademarks.

Valuation Methodologies Used to Measure Fair Value on a Recurring Basis

Derivative Financial Instruments — Our financial derivative assets and liabilities include interest rate swaps, FX forward contracts, FX embedded derivatives and commodity contracts, valued using valuation models based on observable market inputs such as forward rates, interest rates, our own credit risk and the credit risk of our counterparties, which comprise investment-grade financial institutions. Based on these inputs, the derivative assets and liabilities are classified within Level 2 of the valuation hierarchy. We have not made any adjustments to the inputs obtained from the independent sources. Based on our continued ability to enter into forward contracts, we consider the markets for our fair value instruments active. We primarily use the income approach, which uses valuation techniques to convert future amounts to a single present amount.

As of December 31, 2018, there had been no significant impact to the fair value of our derivative liabilities due to our own credit risk, as the related instruments are collateralized under our senior credit facilities. Similarly, there had been no significant impact to the fair value of our derivative assets based on our evaluation of our counterparties’ credit risks.

Equity Security - As indicated in Note 3, during 2018, we adopted an amendment to guidance that requires, among other things, equity securities (excluding equity method investments) to be measured at fair value. In connection with our adoption, we adjusted the carrying value of an equity security, previously reflected on our consolidated balance sheet within (“Other assets”) at its historical cost of $0.7, to its estimated fair value of $16.6. We determined the estimated fair value utilizing a practical expedient under the amended guidance, with such estimated fair value based on our ownership percentage applied to the net asset value of the investee as presented in the investee’s most recent audited financial statements. As previously indicated, the increase in the equity security’s carrying value resulted in a reduction, net of tax, of our retained deficit of $12.0. Future changes in fair value associated with this equity security will be recognized in “Other expense, net.” We are restricted from transferring this investment without approval of the manager of the investee.

Indebtedness — The estimated fair value of our debt instruments as of December 31, 2018 and December 31, 2017 approximated the related carrying values due primarily to the variable market-based interest rates for such instruments.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

Quarterly Financial Information Disclosure [Abstract]

Quarterly Results (Unaudited)

12 Months Ended

Dec. 31, 2018

Quarterly Results (Unaudited)



	First ⁽⁴⁾				Second ⁽⁴⁾					Third ⁽⁴⁾					Fourth ⁽⁴⁾
	2018		2017		2018		2017			2018			2017		2018			2017
Operating revenues ⁽¹⁾	$	351.9	$	340.6	$	379.2	$	349.7		$	362.5		$	348.5	$	445.0		$	387.0
Gross profit ⁽¹⁾	90.1		88.1		97.7		76.1			87.7			85.1		135.2			80.9
Income (loss) from continuing operations, net of tax ⁽²⁾	12.4		10.3		19.7		(8.3		)	6.8			22.0		39.3			60.0
Income (loss) from discontinued operations, net of tax ⁽³⁾	—		7.1		3.3		(0.7		)	(0.2		)	0.3		(0.1		)	(1.4		)
Net income (loss)	$	12.4	$	17.4	$	23.0	$	(9.0	)	$	6.6		$	22.3	$	39.2		$	58.6
Basic income (loss) per share of common stock:
Continuing operations, net of tax	$	0.29	$	0.24	$	0.46	$	(0.19	)	$	0.16		$	0.51	$	0.91		$	1.41
Discontinued operations, net of tax	—		0.17		0.08		(0.02		)	(0.01		)	0.01		(0.01		)	(0.03		)
Net income (loss)	$	0.29	$	0.41	$	0.54	$	(0.21	)	$	0.15		$	0.52	$	0.90		$	1.38
Diluted income (loss) per share of common stock:
Continuing operations, net of tax	$	0.28	$	0.24	$	0.44	$	(0.19	)	$	0.15		$	0.50	$	0.88		$	1.35
Discontinued operations, net of tax	—		0.16		0.07		(0.02		)	—			0.01		—			(0.03		)
Net income (loss)	$	0.28	$	0.40	$	0.51	$	(0.21	)	$	0.15		$	0.51	$	0.88		$	1.32

___________________________________________________________________

Note: The sum of the quarters’ income per share may not equal the full year per share amounts.


⁽¹⁾	During the third quarter of 2018, we revised our estimates of revenues and costs, associated with our large power projects in South Africa. These revisions resulted in a charge to “Income (loss) from continuing operations before income taxes” of $4.7, which is comprised of a reduction in revenue of $2.7 and an increase in cost of products sold of $2.0.

During the second and fourth quarters of 2017, we revised our estimates of revenues and costs associated with the above projects. These revisions resulted in charges to “Income (loss) from continuing operations before income taxes” of $22.9 and $29.9, respectively, which is comprised of reductions in revenue of $13.5 and $23.4, respectively, and increases in cost of products sold of $9.4 and $6.5, respectively, in the second and fourth quarters of 2017. See Notes 6 and 14 for additional details.


⁽²⁾	During the third quarter of 2017, in connection with a favorable legal ruling, we reduced our unfunded liability related to postretirement benefits resulting in a pre-tax gain of $2.6. See Note 10 for additional details.

During the third quarter of 2017, we settled a contract that had been suspended and then ultimately cancelled by a customer of our Heat Transfer business, resulting in a pre-tax gain of $10.2.

During the fourth quarter of 2018 and 2017, we recognized pre-tax actuarial losses of $6.6 and $4.2, respectively, associated with our pension and postretirement benefit plans. See Note 10 for additional details.

During the fourth quarter of 2017, we recognized an income tax benefit of $77.6 for a worthless stock deduction in the U.S. associated with our investment in a South African subsidiary. See Note 11 for additional details.

During the fourth quarter of 2017, we recorded a provisional net charge of $11.8 associated with the impact of the new corporate tax regulations that were enacted in the U.S.. See Note 11 for additional details.

⁽³⁾During the first quarter of 2017, we reduced the net loss on the sale of Balcke Dürr by $7.2.

During the second quarter of 2017, we increased the net loss on the sale of Balcke Dürr by $0.4.

During the second quarter of 2018, we reached an agreement with the buyer of Balcke Dürr on the amount of cash and working capital at the closing date, as well as various other matters. The agreement resulted in a net gain of $3.8.

See Note 4 for additional details on the above transactions.

⁽⁴⁾We establish actual interim closing dates using a fiscal calendar, which requires our businesses to close their books on the Saturday closest to the end of the first calendar quarter, with the second and third quarters being 91 days in length. Our fourth quarter ends on December 31. The interim closing dates for the first, second and third quarters of 2018 were March 31, June 30 and September 29, compared to the respective April 1, July 1 and September 30, 2017 dates. This practice only affects the quarterly reporting periods and not the annual reporting period. We had one less day in the first quarter of 2018 and one more day in the fourth quarter of 2018 than in the respective 2017 periods.

Basis of Presentation and Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2018

Principles of Consolidation

Consolidation, Variable Interest Entity

In determining whether we are the primary beneficiary of a variable interest entity (“VIE”), we perform a qualitative analysis that considers the design of the VIE, the nature of our involvement and the variable interests held by other parties to determine which party has the power to direct the activities of the VIE that most significantly impact the entity’s economic performance, and which party has the obligation to absorb losses or the right to receive benefits of the entity that could potentially be significant to the VIE. We have an interest in a VIE, in which we are not the primary beneficiary, as a result of the sale of Balcke Dürr. See below and in Notes 2, 4 and 16 for further discussion of the Balcke Dürr sale. All other VIEs are considered immaterial, individually and in aggregate, to our consolidated financial statements.

Change in Presentation

Retirement of Treasury Stock

In accordance with our accounting policy, we allocate any excess of share repurchase over par value between “Paid-in capital” and “Retained earnings,”

Foreign Currency Translation and Transactions

Cash Equivalents

Cash Equivalents — We consider highly liquid money market investments with original maturities of three months or less at the date of purchase to be cash equivalents.

Revenue Recognition

Research and Development Costs

Property, Plant and Equipment

Pension and Postretirement

Defined benefit pension plans cover a portion of our salaried and hourly paid employees, including certain employees in foreign countries. Beginning in 2001, we discontinued providing these pension benefits generally to newly hired employees. Effective January 31, 2018, we no longer provide service credits to active participants.

The plan year-end date for all our plans is December 31.

he accumulated postretirement benefit obligation was determined using the terms and conditions of our various plans, together with relevant actuarial assumptions and health care cost trend rates. It is our policy to review the postretirement assumptions annually. The assumptions are determined by us and are established based on our prior experience and our expectations that future health care cost trend rates will decline. In addition, we consider advice from independent actuaries.

e review the pension assumptions annually. Pension income or expense for the year is determined using assumptions as of the beginning of the year (except for the effects of recognizing changes in the fair value of plan assets and actuarial gains and losses in the fourth quarter of each year), while the funded status is determined using assumptions as of the end of the year. We determined assumptions and established them at the respective balance sheet date using the following principles: (i) the expected long-term rate of return on plan assets is established based on forward looking long-term expectations of asset returns over the expected period to fund participant benefits based on the target investment mix of our plans; (ii) the discount rate is determined by matching the expected projected benefit obligation cash flows for each of the plans to a yield curve that is representative of long-term, high-quality (rated AA or higher) fixed income debt instruments as of the measurement date; and (iii) the rate of increase in compensation levels is established based on our expectations of current and foreseeable future increases in compensation. In addition, we consider advice from independent actuaries.

Income Taxes

Derivative Financial Instruments

Cash flows from hedging activities are included in the same category as the items being hedged, which are primarily operating activities.

We manufacture and sell our products in a number of countries and, as a result, are exposed to movements in foreign currency exchange rates. Our objective is to preserve the economic value of non-functional currency-denominated cash flows and to minimize the impact of changes as a result of currency fluctuations. Our principal currency exposures relate to the South African Rand, GBP, and Euro.

From time to time, we enter into forward contracts to manage the exposure on contracts with forecasted transactions denominated in non-functional currencies and to manage the risk of transaction gains and losses associated with assets/liabilities denominated in currencies other than the functional currency of certain subsidiaries (“FX forward contracts”). In addition, some of our contracts contain currency forward embedded derivatives (“FX embedded derivatives”), because the currency of exchange is not “clearly and closely” related to the functional currency of either party to the transaction. Certain of our FX forward contracts are designated as cash flow hedges. To the extent these derivatives are effective in offsetting the variability of the hedged cash flows, changes in the derivatives’ fair value are not included in current earnings, but are included in AOCI. These changes in fair value are reclassified into earnings as a component of revenues or cost of products sold, as applicable, when the forecasted transaction impacts earnings. In addition, if the forecasted transaction is no longer probable, the cumulative change in the derivatives’ fair value is recorded as a component of “Other expense, net” in the period in which the transaction is no longer considered probable of occurring. To the extent a previously designated hedging transaction is no longer an effective hedge, any ineffectiveness measured in the hedging relationship is recorded in earnings in the period in which it occurs.

Use of Estimates

Use of Estimates

Accounts Receivable Allowances

Inventory

Inventories include material, labor and factory overhead costs and are reduced, when necessary, to estimated net realizable values. Certain domestic inventories are valued using the last-in, first-out (“LIFO”) method. These inventories were approximately 45% and 56% of total inventory at December 31, 2018 and 2017, respectively. Other inventories are valued using the first-in, first-out (“FIFO”) method.

Long-Lived Assets and Intangible Assets Subject to Amortization

Goodwill and Indefinite-Lived Intangible Assets

Accrued Expenses

Accrued Expenses — We make estimates and judgments in establishing accruals as required under GAAP.

Legal

Environmental Remediation Costs

Risk Management Matters

Warranty

Income Taxes

Employee Benefit Plans

Parent Guarantees and Bonds Associated with Balcke Durr

New Accounting Pronouncements

The following is a summary of new accounting pronouncements that apply or may apply to our business.

ASC Topic 606

Summarized below is the impact of the initial application of ASC 606 on our consolidated balance sheet:



	December 31, 2017			Impact of Adoption of ASC 606			January 1, 2018

Assets
Accounts receivable, net	$	267.5		$	(36.0	)	$	231.5
Inventories, net	143.0			(40.2		)	102.8
Contract assets	—			70.7			70.7
Other current assets	97.7			(3.6		)	94.1
Deferred income taxes	50.9			(0.9		)	50.0

Liabilities
Contract liabilities	—			86.9			86.9
Accrued expenses	292.6			(99.0		)	193.6
Other long-term liabilities	885.8			(1.6		)	884.2

Equity
Accumulated other comprehensive income	250.1			(0.3		)	249.8
Retained deficit	$	(742.3	)	$	4.0		$	(738.3	)

Special Charges, Net

We anticipate that the liabilities related to restructuring actions will be paid within one year from the period in which the action was initiated.

Goodwill and Other Intangible Assets

Defined Contribution Retirement Plans

e maintain a defined contribution retirement plan (the “DC Plan”) pursuant to Section 401(k) of the U.S. Internal Revenue Code. Under the DC Plan, eligible U.S. employees may voluntarily contribute up to 50% of their compensation into the DC Plan and we match a portion of participating employees’ contributions. Our matching contributions are primarily made in newly issued shares of company common stock and are issued at the prevailing market price. The matching contributions vest with the employee immediately upon the date of the match and there are no restrictions on the resale of common stock held by employees.

Potential Uncertain Positions

Concentrations of Credit Risk

Financial instruments that potentially subject us to significant concentrations of credit risk consist of cash and equivalents, trade accounts receivable, and interest rate swap, foreign currency forward, and commodity contracts. These financial instruments, other than trade accounts receivable, are placed with high-quality financial institutions throughout the world. We periodically evaluate the credit standing of these financial institutions.

We maintain cash levels in bank accounts that, at times, may exceed federally-insured limits. We have not experienced, and believe we are not exposed to significant risk of loss in these accounts.

We have credit loss exposure in the event of nonperformance by counterparties to the above financial instruments, but have no other off-balance-sheet credit risk of accounting loss. We anticipate, however, that counterparties will be able to fully satisfy their obligations under the contracts. We do not obtain collateral or other security to support financial instruments subject to credit risk, but we do monitor the credit standing of counterparties.

Concentrations of credit risk arising from trade accounts receivable are due to selling to customers in a particular industry. We mitigate our credit risks by performing ongoing credit evaluations of our customers’ financial conditions and obtaining collateral, advance payments, or other security when appropriate. No one customer, or group of customers that to our knowledge are under common control, accounted for more than 10% of our revenues for any period presented.

Fair Value

Valuation Methodologies Used to Measure Fair Value on a Recurring Basis


•	Level 1 — Quoted prices for identical instruments in active markets.


•	Level 2 — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.


•	Level 3 — Significant inputs to the valuation model are unobservable.

Fiscal Period

We establish actual interim closing dates using a fiscal calendar, which requires our businesses to close their books on the Saturday closest to the end of the first calendar quarter, with the second and third quarters being 91 days in length. Our fourth quarter ends on December 31. The interim closing dates for the first, second and third quarters of 2018 were March 31, June 30 and September 29, compared to the respective April 1, July 1 and September 30, 2017 dates. This practice only affects the quarterly reporting periods and not the annual reporting period. We had one less day in the first quarter of 2018 and one more day in the fourth quarter of 2018 than in the respective 2017 periods.

Environmental Matters

Environmental Matters

Basis of Presentation and Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2018

Long Term Contracts or Programs

Costs and estimated losses on uncompleted contracts, from their inception, and the related amounts billed as of December 31, 2017 were as follows:




Costs incurred on uncompleted contracts	$	1,261.3
Estimated losses to date	(59.9		)
	1,201.4
Less: Billings to date	(1,202.0		)
Billings in excess of costs and estimated losses	$	(0.6	)

Costs in Excess of Billings and Billings in Excess of Costs




Costs and estimated losses in excess of billings ⁽¹⁾	$	28.8
Billings in excess of costs and estimated losses on uncompleted contracts ⁽²⁾	(29.4		)
Net billings in excess of costs and estimated losses	$	(0.6	)

____________________

⁽¹⁾ Reported as a component of “Accounts receivable, net.”

⁽²⁾ Reported as a component of “Accrued expenses.”

Use of Estimates (Tables)

12 Months Ended

Dec. 31, 2018

Schedule of activity for accounts receivable allowance accounts

Summarized below is the activity for these allowance accounts.



	Year ended December 31,
	2018			2017			2016
Balance at beginning of year	$	10.2		$	10.1		$	9.1
Allowances provided	17.7			13.2			15.7
Write-offs, net of recoveries, credits issued and other	(15.7		)	(13.1		)	(14.7		)
Balance at end of year	$	12.2		$	10.2		$	10.1

Schedule of accrued expenses

Summarized in the table below are the components of accrued expenses at December 31, 2018 and 2017.



	December 31,
	2018		2017
Employee benefits	$	68.5	$	68.9
Unearned revenue ⁽¹⁾	—		100.1
Warranty	12.0		13.8
Other⁽²⁾	103.2		109.8
Total	$	183.7	$	292.6

___________________________________________________________________

⁽¹⁾


⁽²⁾	Other consists of various items including, among other items, accrued legal, interest and restructuring costs, none of which is individually material.

Schedule of product warranty accrual

The following is an analysis of our product warranty accrual for the periods presented:



	Year ended December 31,
	2018			2017			2016
Balance at beginning of year	$	33.9		$	35.8		$	36.3
Acquisitions	1.0			—			—
Impact of initial adoption of ASC 606	0.4			—			—
Provisions	11.9			13.0			15.2
Usage	(13.1		)	(15.4		)	(15.5		)
Currency translation adjustment	(0.1		)	0.5			(0.2		)
Balance at end of year	34.0			33.9			35.8
Less: Current portion of warranty	12.0			13.8			15.6
Non-current portion of warranty	$	22.0		$	20.1		$	20.2

__________________________________________________________________

New Accounting Pronouncements (Tables)

12 Months Ended

Dec. 31, 2018

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

Cumulative Effect on Balance Sheet

Summarized below is the impact of the initial application of ASC 606 on our consolidated balance sheet:



	December 31, 2017			Impact of Adoption of ASC 606			January 1, 2018

Assets
Accounts receivable, net	$	267.5		$	(36.0	)	$	231.5
Inventories, net	143.0			(40.2		)	102.8
Contract assets	—			70.7			70.7
Other current assets	97.7			(3.6		)	94.1
Deferred income taxes	50.9			(0.9		)	50.0

Liabilities
Contract liabilities	—			86.9			86.9
Accrued expenses	292.6			(99.0		)	193.6
Other long-term liabilities	885.8			(1.6		)	884.2

Equity
Accumulated other comprehensive income	250.1			(0.3		)	249.8
Retained deficit	$	(742.3	)	$	4.0		$	(738.3	)



	Year ended December 31, 2018
Consolidated statement of operations and comprehensive income	Reported			Effect of ASC 606 Adoption			Under Prior Revenue Recognition Guidance
Revenues	$	1,538.6		$	(14.2	)	$	1,524.4
Cost of products sold	1,127.9			(11.6		)	1,116.3
Selling, general and administrative	292.6			(0.6		)	292.0
Operating income	107.6			(2.0		)	105.6
Income from continuing operations before income taxes	79.6			(2.0		)	77.6
Income tax provision	(1.4		)	0.5			(0.9		)
Income from continuing operations	78.2			(1.5		)	76.7
Net income	$	81.2		$	(1.5	)	$	79.7

Comprehensive income	$	76.0		$	(0.5	)	$	75.5

Basic income per share of common stock:
Income from continuing operations	$	1.82		$	(0.04	)	$	1.78
Net income per share	$	1.89		$	(0.04	)	$	1.85

Diluted income per share of common stock:
Income from continuing operations	$	1.75		$	(0.03	)	$	1.72
Net income per share	$	1.82		$	(0.03	)	$	1.79



	As of December 31, 2018
Consolidated balance sheet	Reported			Effect of ASC 606 Adoption			Under Prior Revenue Recognition Guidance
Accounts receivable, net	$	269.1		$	33.2		$	302.3
Contract assets	91.2			(91.2		)	—
Inventories, net	128.8			52.1			180.9
Other current assets	40.5			4.1			44.6
Total current assets	598.4			(1.8		)	596.6
Deferred income taxes	24.4			1.4			25.8
TOTAL ASSETS	$	2,057.5		$	(0.4	)	$	2,057.1
Contract liabilities	$	79.5		$	(79.5	)	$	—
Accrued expenses	183.7			82.0			265.7
Total current liabilities	470.2			2.5			472.7
Other long-term liabilities	817.3			1.6			818.9
Total long-term liabilities	1,172.4			1.6			1,174.0

Retained deficit	(650.1		)	(5.5		)	(655.6		)
Accumulated other comprehensive income	244.9			1.0			245.9
Total equity	414.9			(4.5		)	410.4
TOTAL LIABILITIES AND EQUITY	$	2,057.5		$	(0.4	)	$	2,057.1

Acquisitions, Discontinued Operations, and Other Dispositions (Tables)

12 Months Ended

Dec. 31, 2018

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following is a summary of the recorded fair values of the assets acquired and liabilities assumed for Cues as of June 7, 2018:



Assets acquired:
Current assets, including cash and equivalents of $20.6	$	70.4
Property, plant and equipment	7.4
Goodwill	48.6
Intangible assets	79.5
Other assets	2.3
Total assets acquired	208.2

Current liabilities assumed	7.8
Non-current liabilities assumed	15.4

Net assets acquired	$	185.0

Business Acquisition, Pro Forma Information



	Years ended December 31,
	2018		2017
Revenues	$	1,572.7	$	1,511.4
Income from continuing operations	87.1		87.4
Net income	90.1		92.7

Income from continuing operations per share of common stock:
Basic	$	2.02	$	2.06
Diluted	$	1.95	$	1.99

Net income per share of common stock:
Basic	$	2.09	$	2.19
Diluted	$	2.02	$	2.11

Schedule of major classes of assets and liabilities, excluding intercompany balances, of businesses reported as discontinued operations

For the years ended December 31, 2018, 2017 and 2016, results of operations from our businesses reported as discontinued operations were as follows:



	Year ended December 31,
	2018			2017			2016
Balcke Dürr
Income (loss) from discontinued operations	$	6.3		$	(2.6	)	$	(107.0	)
Income tax (provision) benefit	(2.5		)	9.4			11.8
Income (loss) from discontinued operations, net	3.8			6.8			(95.2		)


All other
Loss from discontinued operations	(1.2		)	(4.0		)	(3.7		)
Income tax benefit	0.4			2.5			1.0
Loss from discontinued operations, net	(0.8		)	(1.5		)	(2.7		)

Total
Income (loss) from discontinued operations	5.1			(6.6		)	(110.7		)
Income tax (provision) benefit	(2.1		)	11.9			12.8
Income (loss) from discontinued operations, net	$	3.0		$	5.3		$	(97.9	)

Balcke Durr

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Schedule of major classes of assets and liabilities, excluding intercompany balances, of businesses reported as discontinued operations

Major classes of line items constituting pre-tax loss and after-tax loss of Balcke Dürr for the year ended December 31, 2016 are shown below:




Revenues	$	153.4
Costs and expenses:
Costs of products sold	144.2
Selling, general and administrative	31.4
Special charges (credits), net	(1.3		)
Other expense, net	(0.2		)
Loss before taxes	(21.1		)
Income tax benefit	4.5
Loss from discontinued operations	$	(16.6	)




Non-cash items included in income (loss) from discontinued operations, net of tax
Depreciation and amortization	$	2.0
Capital expenditures	0.7

Revenue from Contract with Customer [Abstract]

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 360
-SubTopic 10
-Section 50
-Paragraph 3A
-URI http://asc.fasb.org/extlink&oid=109226691&loc=SL51724579-110230

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=109222650&loc=d3e1474-107760

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
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+ Details

Revenues from Contracts (Tables)

12 Months Ended

Dec. 31, 2018

Disaggregation of Revenue



	Year Ended December 31, 2018
Reportable Segments and All Other	HVAC		Detection and Measurement		Engineered Solutions		All Other		Total

Major product lines
Cooling	$	281.7	$	—	$	—	$	—	$	281.7
Boilers, comfort heating, and ventilation	300.4		—		—		—		300.4
Underground locators and inspection and rehabilitation equipment	—		159.1		—		—		159.1
Signal monitoring, obstruction lighting, and bus fare collection systems	—		161.8		—		—		161.8
Power transformers	—		—		373.8		—		373.8
Process cooling equipment, services, and heat exchangers	—		—		163.2		49.5		212.7
South African projects	—		—		—		49.1		49.1
	$	582.1	$	320.9	$	537.0	$	98.6	$	1,538.6

Timing of Revenue Recognition
Revenues recognized at a point in time	$	582.1	$	307.3	$	61.5	$	5.1	$	956.0
Revenues recognized over time	—		13.6		475.5		93.5		582.6
	$	582.1	$	320.9	$	537.0	$	98.6	$	1,538.6

Contract with Customer, Asset and Liability

Our contract balances consisted of the following as of December 31, 2018 and January 1, 2018:



Contract Balances	December 31, 2018			January 1, 2018 ⁽¹⁾			Change
Contract Accounts Receivable ⁽²⁾	$	263.9		$	222.9		$	41.0
Contract Assets	91.2			70.7			20.5
Contract Liabilities - current	(79.5		)	(86.9		)	7.4
Contract Liabilities - non-current ⁽³⁾	(2.1		)	—			(2.1		)
Net contract balance	$	273.5		$	206.7		$	66.8

_____________________

⁽¹⁾ See Note 3 for the impact of the change at January 1, 2018 as a result of the adoption of ASC 606.

⁽²⁾ Included in “Accounts receivable, net” within the accompanying consolidated balance sheet.

⁽³⁾ Included in “Other long-term liabilities” within the accompanying consolidated balance sheet.

Schedule of New Accounting Pronouncements and Changes in Accounting Principles

Summarized below is the impact of the initial application of ASC 606 on our consolidated balance sheet:



	December 31, 2017			Impact of Adoption of ASC 606			January 1, 2018

Assets
Accounts receivable, net	$	267.5		$	(36.0	)	$	231.5
Inventories, net	143.0			(40.2		)	102.8
Contract assets	—			70.7			70.7
Other current assets	97.7			(3.6		)	94.1
Deferred income taxes	50.9			(0.9		)	50.0

Liabilities
Contract liabilities	—			86.9			86.9
Accrued expenses	292.6			(99.0		)	193.6
Other long-term liabilities	885.8			(1.6		)	884.2

Equity
Accumulated other comprehensive income	250.1			(0.3		)	249.8
Retained deficit	$	(742.3	)	$	4.0		$	(738.3	)



	Year ended December 31, 2018
Consolidated statement of operations and comprehensive income	Reported			Effect of ASC 606 Adoption			Under Prior Revenue Recognition Guidance
Revenues	$	1,538.6		$	(14.2	)	$	1,524.4
Cost of products sold	1,127.9			(11.6		)	1,116.3
Selling, general and administrative	292.6			(0.6		)	292.0
Operating income	107.6			(2.0		)	105.6
Income from continuing operations before income taxes	79.6			(2.0		)	77.6
Income tax provision	(1.4		)	0.5			(0.9		)
Income from continuing operations	78.2			(1.5		)	76.7
Net income	$	81.2		$	(1.5	)	$	79.7

Comprehensive income	$	76.0		$	(0.5	)	$	75.5

Basic income per share of common stock:
Income from continuing operations	$	1.82		$	(0.04	)	$	1.78
Net income per share	$	1.89		$	(0.04	)	$	1.85

Diluted income per share of common stock:
Income from continuing operations	$	1.75		$	(0.03	)	$	1.72
Net income per share	$	1.82		$	(0.03	)	$	1.79



	As of December 31, 2018
Consolidated balance sheet	Reported			Effect of ASC 606 Adoption			Under Prior Revenue Recognition Guidance
Accounts receivable, net	$	269.1		$	33.2		$	302.3
Contract assets	91.2			(91.2		)	—
Inventories, net	128.8			52.1			180.9
Other current assets	40.5			4.1			44.6
Total current assets	598.4			(1.8		)	596.6
Deferred income taxes	24.4			1.4			25.8
TOTAL ASSETS	$	2,057.5		$	(0.4	)	$	2,057.1
Contract liabilities	$	79.5		$	(79.5	)	$	—
Accrued expenses	183.7			82.0			265.7
Total current liabilities	470.2			2.5			472.7
Other long-term liabilities	817.3			1.6			818.9
Total long-term liabilities	1,172.4			1.6			1,174.0

Retained deficit	(650.1		)	(5.5		)	(655.6		)
Accumulated other comprehensive income	244.9			1.0			245.9
Total equity	414.9			(4.5		)	410.4
TOTAL LIABILITIES AND EQUITY	$	2,057.5		$	(0.4	)	$	2,057.1

Information on Reportable and Other Operating Segments (Tables)

12 Months Ended

Dec. 31, 2018

Segment Reporting [Abstract]

Schedule of reportable segments and other operating segments, including the results of acquisitions from the respective dates of acquisition

Financial data for our reportable segments and other operating segments for the years ended December 31, 2018, 2017 and 2016 were as follows:



	2018			2017			2016
Revenues:
HVAC reportable segment	$	582.1		$	511.0		$	509.5
Detection and Measurement reportable segment	320.9			260.3			226.4
Engineered Solutions reportable segment	537.0			560.7			598.0
All Other ⁽¹⁾	98.6			93.8			138.4
Consolidated revenues	$	1,538.6		$	1,425.8		$	1,472.3
Income (loss):
HVAC reportable segment	$	90.0		$	74.1		$	80.2
Detection and Measurement reportable segment	72.4			63.4			45.3
Engineered Solutions reportable segment	35.0			44.2			39.1
All Other ⁽¹⁾⁽²⁾	(18.9		)	(56.8		)	(21.8		)
Total income for segments	178.5			124.9			142.8
Corporate expense	48.5			46.2			41.7
Pension and postretirement expense	—			0.3			0.4
Long-term incentive compensation expense	15.5			15.8			13.7
Impairment of intangible assets	—			—			30.1
Special charges, net	6.3			2.7			5.3
Gain (loss) on sale of dry cooling business	(0.6		)	—			18.4
Consolidated operating income	$	107.6		$	59.9		$	70.0

Capital expenditures:
HVAC reportable segment	$	2.7		$	2.2		$	1.9
Detection and Measurement reportable segment	1.9			0.8			0.7
Engineered Solutions reportable segment	6.9			5.8			5.6
All Other	0.1			0.3			0.9
General corporate	0.8			1.9			2.6
Total capital expenditures	$	12.4		$	11.0		$	11.7
Depreciation and amortization:
HVAC reportable segment	$	5.4		$	5.5		$	5.3
Detection and Measurement reportable segment	8.4			4.1			3.5
Engineered Solutions reportable segment	10.6			10.4			11.0
All Other	1.8			2.1			4.2
General corporate	3.0			3.1			2.5
Total depreciation and amortization	$	29.2		$	25.2		$	26.5

	2018			2017			2016
Identifiable assets:
HVAC reportable segment	$	778.5		$	747.1		$	710.1
Detection and Measurement reportable segment	479.0			277.8			244.2
Engineered Solutions reportable segment	422.4			466.2			462.5
All Other	82.2			91.6			105.1
General corporate	295.4			457.7			390.6
Total identifiable assets	$	2,057.5		$	2,040.4		$	1,912.5
Geographic Areas:
Revenues: ⁽³⁾
United States	$	1,317.5		$	1,243.3		$	1,235.2
China	38.5			28.0			33.5
South Africa ⁽¹⁾	72.7			56.9			105.4
United Kingdom	62.4			60.8			59.1
Other	47.5			36.8			39.1
	$	1,538.6		$	1,425.8		$	1,472.3



Tangible Long-Lived Assets:
United States	$	837.4	$	919.6	$	897.0
Other	28.9		24.8		29.6
Total tangible long-lived assets	$	866.3	$	944.4	$	926.6

___________________________________________________________________

⁽¹⁾


⁽²⁾	During the third quarter of 2017, we settled a contract that had been suspended and then ultimately canceled by a customer of our Heat Transfer operating segment for cash proceeds of $9.0 and other consideration. In connection with the settlement, we recorded a gain of $10.2.


⁽³⁾	Revenues are included in the above geographic areas based on the country that recorded the customer revenue.

Special Charges, Net (Tables)

12 Months Ended

Dec. 31, 2018

Restructuring and Related Activities [Abstract]

Schedule of special charges by expense type

Special charges for the years ended December 31, 2018, 2017 and 2016 are described in more detail below and in the applicable sections that follow:



	Years Ended December 31,
	2018		2017		2016
Employee termination costs	$	5.7	$	2.5	$	1.7
Other cash costs, net	—		0.2		—
Non-cash asset write-downs	0.6		—		3.6
Total	$	6.3	$	2.7	$	5.3

Schedule of special charges

2018 Charges:



	Employee Termination Costs		Other Cash Costs, Net		Non-Cash Asset Write-downs		Total Special Charges
HVAC reportable segment	$	0.8	$	—	$	—	$	0.8
Detection and Measurement reportable segment	—		—		—		—
Engineered Solutions reportable segment	—		—		—		—
All Other	4.4		—		0.6		5.0
Corporate	0.5		—		—		0.5
Total	$	5.7	$	—	$	0.6	$	6.3

2016 Charges:



	Employee Termination Costs		Other Cash Costs, Net		Non-Cash Asset Write-downs		Total Special Charges
HVAC reportable segment	$	—	$	—	$	—	$	—
Detection and Measurement reportable segment	0.5		—		0.3		0.8
Engineered Solutions reportable segment	0.1		—		—		0.1
All Other	1.1		—		3.3		4.4
Corporate	—		—		—		—
Total	$	1.7	$	—	$	3.6	$	5.3

2017 Charges:



	Employee Termination Costs		Other Cash Costs, Net		Non-Cash Asset Write-downs		Total Special Charges
HVAC reportable segment	$	0.4	$	—	$	—	$	0.4
Detection and Measurement reportable segment	0.3		—		—		0.3
Engineered Solutions reportable segment	0.2		0.2		—		0.4
All Other	1.5		—		—		1.5
Corporate	0.1		—		—		0.1
Total	$	2.5	$	0.2	$	—	$	2.7

Schedule of the analysis of the entity's restructuring liabilities

The following is an analysis of our restructuring liabilities for the years ended December 31, 2018, 2017 and 2016:



	December 31,
	2018			2017			2016
Balance at beginning of year	$	0.6		$	0.9		$	1.6
Special charges⁽¹⁾	5.7			2.7			1.7
Utilization — cash	(3.6		)	(3.0		)	(2.1		)
Currency translation adjustment and other	—			—			(0.3		)
Balance at the end of year	$	2.7		$	0.6		$	0.9

___________________________________________________________________


⁽¹⁾	The years ended December 31, 2018, 2017 and 2016 excluded $0.6, $0.0 and $3.6, respectively, of non-cash charges that impacted special charges but not the restructuring liabilities.

Inventories, Net (Tables)

12 Months Ended

Dec. 31, 2018

Inventory Disclosure [Abstract]

Schedule of Inventories

Inventories at December 31, 2018 and 2017 comprised the following:



	December 31,
	2018			2017
Finished goods	$	49.8		$	33.0
Work in process	16.2			56.0
Raw materials and purchased parts	74.9			66.4
Total FIFO cost	140.9			155.4
Excess of FIFO cost over LIFO inventory value	(12.1		)	(12.4		)
Total inventories	$	128.8		$	143.0

Goodwill and Other Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of changes in the carrying amount of goodwill, by reportable segment and other operating segments

The changes in the carrying amount of goodwill, for the year ended December 31, 2018, were as follows:



	December 31, 2017			Goodwill Resulting from Business Combinations ⁽¹⁾		Impairments		Foreign Currency Translation			December 31, 2018
HVAC reportable segment
Gross goodwill	$	263.7		$	—	$	—	$	(1.9	)	$	261.8
Accumulated impairments	(144.7		)	—		—		0.3			(144.4		)
Goodwill	119.0			—		—		(1.6		)	117.4
Detection and Measurement reportable segment
Gross goodwill	216.6			50.4		—		(2.0		)	265.0
Accumulated impairments	(136.0		)	—		—		1.7			(134.3		)
Goodwill	80.6			50.4		—		(0.3		)	130.7
Engineered Solutions reportable segment
Gross goodwill	337.5			—		—		(2.2		)	335.3
Accumulated impairments	(191.2		)	—		—		2.2			(189.0		)
Goodwill	146.3			—		—		—			146.3
All Other
Gross goodwill	20.8			—		—		—			20.8
Accumulated impairments	(20.8		)	—		—		—			(20.8		)
Goodwill	—			—		—		—			—
Total
Gross goodwill	838.6			50.4		—		(6.1		)	882.9
Accumulated impairments	(492.7		)	—		—		4.2			(488.5		)
Goodwill	$	345.9		$	50.4	$	—	$	(1.9	)	$	394.4

⁽¹⁾ Reflects amounts acquired in connection with the Schonstedt and Cues acquisitions of $1.8 and $48.6, respectively.

The changes in the carrying amount of goodwill, for the year ended December 31, 2017, were as follows:



	December 31, 2016			Impairments		Foreign Currency Translation			December 31, 2017
HVAC reportable segment
Gross goodwill	$	258.5		$	—	$	5.2		$	263.7
Accumulated impairments	(144.2		)	—		(0.5		)	(144.7		)
Goodwill	114.3			—		4.7			119.0
Detection and Measurement reportable segment
Gross goodwill	214.4			—		2.2			216.6
Accumulated impairments	(134.2		)	—		(1.8		)	(136.0		)
Goodwill	80.2			—		0.4			80.6
Engineered Solutions reportable segment
Gross goodwill	330.6			—		6.9			337.5
Accumulated impairments	(184.7		)	—		(6.5		)	(191.2		)
Goodwill	145.9			—		0.4			146.3
All Other
Gross goodwill	20.8			—		—			20.8
Accumulated impairments	(20.8		)	—		—			(20.8		)
Goodwill	—			—		—			—
Total
Gross goodwill	824.3			—		14.3			838.6
Accumulated impairments	(483.9		)	—		(8.8		)	(492.7		)
Goodwill	$	340.4		$	—	$	5.5		$	345.9

Schedule of identifiable intangible assets

Identifiable intangible assets were as follows:



	December 31, 2018							December 31, 2017
	Gross Carrying Value		Accumulated Amortization			Net Carrying Value		Gross Carrying Value		Accumulated Amortization			Net Carrying Value
Intangible assets with determinable lives:⁽¹⁾
Customer relationships	$	44.8	$	(3.5	)	$	41.3	$	1.4	$	(1.4	)	$	—
Technology	17.1		(1.1		)	16.0		2.1		(0.5		)	1.6
Patents	4.5		(4.5		)	—		4.5		(4.5		)	—
Other	11.3		(7.9		)	3.4		11.7		(7.9		)	3.8
	77.7		(17.0		)	60.7		19.7		(14.3		)	5.4
Trademarks with indefinite lives ⁽²⁾	137.7		—			137.7		112.2		—			112.2
Total	$	215.4	$	(17.0	)	$	198.4	$	131.9	$	(14.3	)	$	117.6

⁽¹⁾


⁽²⁾	Changes during 2018 related primarily to the acquisition of the Schonstedt and Cues trademarks of $1.8 and $27.6, respectively, and the sale of the trademarks associated with our Heat Transfer business of $3.3 in connection with the planned wind-down of the business.

Employee Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2018

Employee Benefit Plans

Schedule of the fair value of plan assets by asset class

Foreign Pension Plans



	Actual Allocations				Mid-point of Target Allocation Range
	2018		2017		2018
Global equity common trust funds	17	%	17	%	13	%
Fixed income common trust funds	39	%	46	%	39	%
Commingled global fund allocation	36	%	34	%	37	%
Non-U.S. Government securities	7	%	—	%	7	%
Short-term investments ⁽¹⁾	1	%	3	%	4	%
Total	100	%	100	%	100	%

___________________________________________________________________


⁽¹⁾	Short-term investments are generally invested in actively managed common trust funds or interest-bearing accounts.

Domestic Pension Plans



	Actual Allocations				Mid-point of Target Allocation Range
	2018		2017		2018
Fixed income common trust funds	70	%	70	%	65	%
Commingled global fund allocation	11	%	12	%	18	%
Non-U.S. Government securities	1	%	1	%	—	%
Global equity common trust funds	6	%	7	%	5	%
U.S. Government securities	10	%	9	%	10	%
Short-term investments ⁽¹⁾	2	%	1	%	2	%
Total	100	%	100	%	100	%

___________________________________________________________________


⁽¹⁾	Short-term investments are generally invested in actively managed common trust funds or interest-bearing accounts.

Schedule of net periodic benefit (income) expense

et periodic pension benefit expense (income) for our domestic and foreign pension plans included the following components:

Domestic Pension Plans



	Year ended December 31,
	2018			2017			2016
Service cost	$	—		$	0.3		$	0.4
Interest cost	12.3			13.4			13.9
Expected return on plan assets	(10.3		)	(10.1		)	(12.9		)
Amortization of unrecognized prior service credits	(0.2		)	(0.1		)	(0.2		)
Recognized net actuarial (gains) losses ⁽¹⁾	(0.2		)	3.9			3.2
Total net periodic pension benefit expense	$	1.6		$	7.4		$	4.4

___________________________________________________________________


⁽¹⁾	Consists primarily of our reported actuarial (gains) losses, the difference between actual and expected returns on plan assets, settlement gains (losses), and curtailment gains. The actuarial losses for 2016 included $1.8 related to the lump-sum payment actions that took place during the second quarter of the year.

oreign Pension Plans



	Year ended December 31,
	2018			2017			2016
Service cost	$	—		$	—		$	—
Interest cost	4.7			4.9			5.6
Expected return on plan assets	(7.5		)	(6.4		)	(6.6		)
Recognized net actuarial losses ⁽¹⁾	9.1			3.1			8.2
Total net periodic pension benefit expense	6.3			1.6			7.2
Less: Net periodic pension expense of discontinued operations	—			—			(0.2		)
Net periodic pension benefit expense of continuing operations	$	6.3		$	1.6		$	7.0

___________________________________________________________________


⁽¹⁾	Consists of our reported actuarial losses and the difference between actual and expected returns on plan assets.

Pension plans

Employee Benefit Plans

Schedule of the fair value of plan assets by asset class

The fair values of pension plan assets at December 31, 2018, by asset class, were as follows:



	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Asset class:
Debt securities:
Fixed income common trust funds ^{(1) (2)}	$	228.5	$	—	$	228.5	$	—
Corporate bonds	—		—		—		—
Non-U.S. Government securities	11.5		—		11.5		—
U.S. Government securities	24.0		—		24.0		—
Equity securities:
Global equity common trust funds ⁽¹⁾ ⁽³⁾	41.1		—		41.1		—
Alternative investments:
Commingled global fund allocations ⁽¹⁾ ⁽⁴⁾	83.3		—		83.3		—
Other:
Short-term investments ⁽⁵⁾	7.8		7.8		—		—
Other	1.0		—		—		1.0
Total	$	397.2	$	7.8	$	388.4	$	1.0

The fair values of pension plan assets at December 31, 2017, by asset class, were as follows:



	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Asset class:
Debt securities:
Fixed income common trust funds ^{(1) (2)}	$	270.2	$	—	$	270.2	$	—
Corporate bonds	1.6		—		1.6		—
Non-U.S. Government securities	—		—		—		—
U.S. Government securities	25.2		—		25.2		—
Equity securities:
Global equity common trust funds ⁽¹⁾ ⁽³⁾	50.6		—		50.6		—
Alternative Investments:	—		—		—		—
Commingled global fund allocations ⁽¹⁾ ⁽⁴⁾	95.1		—		95.1		—
Other:
Short-term investments ⁽⁵⁾	9.4		9.4		—		—
Other	1.0		—		—		1.0
Total	$	453.1	$	9.4	$	442.7	$	1.0

___________________________________________________________________

⁽¹⁾


⁽²⁾	This class represents investments in actively managed common trust funds that invest in a variety of fixed income investments, which may include corporate bonds, both U.S. and non-U.S. municipal securities, interest rate swaps, options and futures.


⁽³⁾	This class represents investments in actively managed common trust funds that invest primarily in equity securities, which may include common stocks, options and futures.


⁽⁴⁾	This class represents investments in actively managed common trust funds with investments in both equity and debt securities. The investments may include common stock, corporate bonds, U.S. and non-U.S. municipal securities, interest rate swaps, options and futures.


⁽⁵⁾	Short-term investments are valued at $1.00/unit, which approximates fair value. Amounts are generally invested in actively managed common trust funds or interest-bearing accounts.

Schedule of estimated minimum benefit payments

ollowing is a summary, as of December 31, 2018, of the estimated future benefit payments for our pension plans in each of the next five fiscal years and in the aggregate for five fiscal years thereafter. Benefit payments are paid from plan assets or directly by us for our non-funded plans. The expected benefit payments are estimated based on the same assumptions used at December 31, 2018 to measure our obligations and include benefits attributable to estimated future employee service.

Estimated future benefit payments: (Domestic and foreign pension plans)

	Domestic Pension Benefits		Foreign Pension Benefits
2019	$	24.1	$	5.1
2020	23.6		5.0
2021	23.3		5.1
2022	24.8		6.0
2023	24.5		6.0
Subsequent five years	108.6		35.0

Schedule of funded status of the pension plans and amounts recognized in consolidated balance sheets

he following tables show the domestic and foreign pension plans’ funded status and amounts recognized in our consolidated balance sheets:



	Domestic Pension Plans						Foreign Pension Plans
	2018			2017			2018			2017
Change in projected benefit obligation:
Projected benefit obligation — beginning of year	$	357.1		$	348.1		$	175.2		$	157.6
Service cost	—			0.3			—			—
Interest cost	12.3			13.4			4.7			4.9
Actuarial (gains) losses	(25.4		)	16.5			(6.8		)	6.7
Settlements	(11.1		)	—			—			—
Curtailment losses	—			0.9			—			—
Plan amendment	—			—			1.2			—
Benefits paid	(12.0		)	(22.1		)	(5.0		)	(8.1		)
Foreign exchange and other	—			—			(11.1		)	14.1
Projected benefit obligation — end of year	$	320.9		$	357.1		$	158.2		$	175.2



	Domestic Pension Plans						Foreign Pension Plans
	2018			2017			2018			2017
Change in plan assets:
Fair value of plan assets — beginning of year	$	269.7		$	261.9		$	183.4		$	163.3
Actual return on plan assets	(14.8		)	23.6			(8.7		)	10.6
Contributions (employer and employee)	6.2			6.3			1.1			3.4
Settlements	(11.1		)	—			—			—
Benefits paid	(12.0		)	(22.1		)	(5.0		)	(8.7		)
Foreign exchange and other	—			—			(11.6		)	14.8
Fair value of plan assets — end of year	$	238.0		$	269.7		$	159.2		$	183.4
Funded status at year-end	(82.9		)	(87.4		)	1.0			8.2
Amounts recognized in the consolidated balance sheets consist of:
Other assets	$	—		$	—		$	3.3		$	8.4
Accrued expenses	(5.6		)	(5.9		)	—			—
Other long-term liabilities	(77.3		)	(81.5		)	(2.3		)	(0.2		)
Net amount recognized	$	(82.9	)	$	(87.4	)	$	1.0		$	8.2
Amount recognized in accumulated other comprehensive income (pre-tax) consists of — net prior service (credits) costs	$	(0.4	)	$	(0.6	)	$	1.2		$	—

Schedule of accumulated benefit obligations in excess of the fair value of plan assets

he following is information about our pension plans that had accumulated benefit obligations in excess of the fair value of their plan assets at December 31, 2018 and 2017:



	Domestic Pension Plans				Foreign Pension Plans
	2018		2017		2018		2017
Projected benefit obligation	$	320.9	$	357.1	$	43.6	$	0.2
Accumulated benefit obligation	320.9		357.1		43.6		0.2
Fair value of plan assets	238.0		269.7		41.3		—

Schedule of actuarial assumptions used in accounting for pension plans

ctuarial assumptions used in accounting for our domestic and foreign pension plans were as follows:



	Year ended December 31,
	2018		2017		2016
Domestic Pension Plans
Weighted-average actuarial assumptions used in determining net periodic pension expense:
Discount rate	3.57	%	3.98	%	4.06	%
Rate of increase in compensation levels	N/A		3.75	%	3.75	%
Expected long-term rate of return on assets	4.00	%	4.00	%	5.00	%
Weighted-average actuarial assumptions used in determining year-end benefit obligations:
Discount rate	4.29	%	3.57	%	3.98	%
Rate of increase in compensation levels	N/A		3.75	%	3.75	%
Foreign Pension Plans
Weighted-average actuarial assumptions used in determining net periodic pension expense:
Discount rate	2.76	%	2.97	%	3.82	%
Rate of increase in compensation levels	N/A		N/A		N/A
Expected long-term rate of return on assets	4.50	%	4.09	%	4.57	%
Weighted-average actuarial assumptions used in determining year-end benefit obligations:
Discount rate	3.02	%	2.76	%	2.97	%
Rate of increase in compensation levels	N/A		N/A		N/A

Postretirement Plans

Employee Benefit Plans

Schedule of funded status of the pension plans and amounts recognized in consolidated balance sheets

he following tables show the postretirement plans’ funded status and amounts recognized in our consolidated balance sheets:



	Postretirement Benefits
	2018			2017
Change in accumulated postretirement benefit obligation:
Accumulated postretirement benefit obligation — beginning of year	$	77.6		$	115.3
Interest cost	2.3			3.5
Actuarial gains	(2.3		)	(5.4		)
Benefits paid	(8.3		)	(9.0		)
Plan amendment	(0.1		)	(26.8		)
Other	(0.4		)	—
Accumulated postretirement benefit obligation — end of year	$	68.8		$	77.6
Funded status at year-end	$	(68.8	)	$	(77.6	)
Amounts recognized in the consolidated balance sheets consist of:
Accrued expenses	$	(8.3	)	$	(8.7	)
Other long-term liabilities	(60.5		)	(68.9		)
Net amount recognized	$	(68.8	)	$	(77.6	)
Amount recognized in accumulated other comprehensive income (pre-tax) consists of — net prior service credits	$	(27.1	)	$	(31.0	)

Schedule of net periodic benefit (income) expense

he net periodic postretirement benefit expense (income) included the following components:



	Year ended December 31,
	2018			2017			2016
Service cost	$	—		$	—		$	—
Interest cost	2.3			3.5			4.2
Amortization of unrecognized prior service credits	(4.0		)	(1.7		)	(0.8		)
Plan amendment	—			(2.6		)	—
Recognized net actuarial (gains) losses	(2.3		)	(2.8		)	0.6
Net periodic postretirement benefit expense (income)	$	(4.0	)	$	(3.6	)	$	4.0

Schedule of estimated future benefit payments and expected federal subsidies

ollowing is a summary, as of December 31, 2018, of the estimated future benefit payments for our postretirement plans in each of the next five fiscal years and in the aggregate for five fiscal years thereafter. The expected benefit payments are estimated based on the same assumptions used at December 31, 2018 to measure our obligations and include benefits attributable to estimated future employee service.



	Postretirement Payments
2019	$	8.5
2020	7.8
2021	7.1
2022	6.4
2023	5.8
Subsequent five years	22.1

Schedule of actuarial assumptions used in accounting for plans

ctuarial assumptions used in accounting for our domestic postretirement plans were as follows:



	Year ended December 31,
	2018		2017		2016
Assumed health care cost trend rates:
Health care cost trend rate for next year	7.00	%	7.25	%	7.50	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)	5.00	%	5.00	%	5.00	%
Year that the rate reaches the ultimate trend rate	2027		2027		2027
Discount rate used in determining net periodic postretirement benefit expense	3.34	%	3.60	%	3.88	%
Discount rate used in determining year-end postretirement benefit obligation	4.09	%	3.34	%	3.69	%

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Schedule of income (loss) from continuing operations before income taxes and (provision for) benefit from income taxes

Income from continuing operations before income taxes and the (provision for) benefit from income taxes consisted of the following:



	Year ended December 31,
	2018			2017			2016
Income (loss) from continuing operations:
United States	$	69.6		$	68.8		$	14.0
Foreign	10.0			(32.7		)	25.4
	$	79.6		$	36.1		$	39.4
(Provision for) benefit from income taxes:
Current:
United States	$	1.5		$	30.4		$	(4.3	)
Foreign	(3.2		)	(3.5		)	(4.8		)
Total current	(1.7		)	26.9			(9.1		)
Deferred and other:
United States	0.6			23.5			0.2
Foreign	(0.3		)	(2.5		)	(0.2		)
Total deferred and other	0.3			21.0			—
Total (provision) benefit	$	(1.4	)	$	47.9		$	(9.1	)

Schedule of reconciliation of income tax computed at the U.S. federal statutory tax rate to the effective income tax rate

The reconciliation of income tax computed at the U.S. federal statutory tax rate to our effective income tax rate was as follows:



	Year ended December 31,
	2018		2017		2016
Tax at U.S. federal statutory rate	21.0	%	35.0	%	35.0	%
State and local taxes, net of U.S. federal benefit	2.9	%	4.4	%	5.0	%
U.S. credits and exemptions	(4.0	)%	(8.5	)%	(12.9	)%
Foreign earnings/losses taxed at different rates	(1.2	)%	(14.9	)%	(5.9	)%
Nondeductible expenses	2.6	%	2.8	%	2.2	%
Adjustments to uncertain tax positions	(8.9	)%	(9.8	)%	(1.9	)%
Changes in valuation allowance	(8.5	)%	54.4	%	17.4	%
Share-based compensation	(2.4	)%	(1.7	)%	—	%
Impairments and basis adjustments	—	%	(226.3	)%	—	%
Disposition of dry cooling business	—	%	—	%	(15.6	)%
U.S. tax reform	(0.9	)%	32.6	%	—	%
Other	1.2	%	(0.7	)%	(0.2	)%
	1.8	%	(132.7	)%	23.1	%

Schedule of significant components of deferred tax assets and liabilities

Significant components of our deferred tax assets and liabilities were as follows:



	As of December 31,
	2018			2017
Deferred tax assets:
NOL and credit carryforwards	$	147.6		$	146.0
Pension, other postretirement and postemployment benefits	37.1			41.2
Payroll and compensation	17.1			18.2
Legal, environmental and self-insurance accruals	22.7			25.3
Working capital accruals	12.4			11.5
Other	9.0			17.6
Total deferred tax assets	245.9			259.8
Valuation allowance	(89.3		)	(110.9		)
Net deferred tax assets	156.6			148.9
Deferred tax liabilities:
Intangible assets recorded in acquisitions	71.7			53.9
Basis difference in affiliates	12.2			3.7
Accelerated depreciation	25.2			28.8
Deferred income	18.9			4.9
Other	5.0			8.0
Total deferred tax liabilities	133.0			99.3
	$	23.6		$	49.6

Schedule of changes in the balance of unrecognized tax benefits

The aggregate changes in the balance of unrecognized tax benefits for the years ended December 31, 2018, 2017 and 2016 were as follows:



	Year ended December 31,
	2018			2017			2016
Unrecognized tax benefit — opening balance	$	31.3		$	37.9		$	48.8
Gross increases — tax positions in prior period	0.6			1.6			3.6
Gross decreases — tax positions in prior period	(2.4		)	(0.3		)	(9.3		)
Gross increases — tax positions in current period	0.7			0.3			0.7
Settlements	—			(1.3		)	—
Lapse of statute of limitations	(9.8		)	(7.1		)	(5.9		)
Change due to foreign currency exchange rates	(0.1		)	0.2			—
Unrecognized tax benefit — ending balance	$	20.3		$	31.3		$	37.9

Indebtedness (Tables)

12 Months Ended

Dec. 31, 2018

Debt Disclosure [Abstract]

Schedule of debt activity (both current and non-current)

The following summarizes our debt activity (both current and non-current) for the year ended December 31, 2018:



	December 31, 2017		Borrowings		Repayments			Other ⁽⁴⁾		December 31, 2018
Revolving loans	$	—	$	199.4	$	(193.0	)	$	—	$	6.4
Term loan ⁽¹⁾	347.7		—		—			0.4		348.1
Trade receivables financing arrangement ⁽²⁾	—		123.0		(100.0		)	—		23.0
Other indebtedness ⁽³⁾	9.1		14.2		(19.0		)	—		4.3
Total debt	356.8		$	336.6	$	(312.0	)	$	0.4	381.8
Less: short-term debt	7.0									31.9
Less: current maturities of long-term debt	0.5									18.0
Total long-term debt	$	349.3								$	331.9

_____________________________________________________________


⁽¹⁾	The term loan is repayable in quarterly installments of 1.25% of the initial loan amount of $350.0, beginning in the first quarter of 2019, with the remaining balance payable in full on December 19, 2022. Balances are net of unamortized debt issuance costs of $1.9 and $2.3 at December 31, 2018 and December 31, 2017, respectively.


⁽²⁾	Under this arrangement, we can borrow, on a continuous basis, up to $50.0, as available. At December 31, 2018, we had $27.0 of available borrowing capacity under this facility after giving effect to outstanding borrowings of $23.0. Borrowings under this arrangement are collateralized by eligible trade receivables of certain of our businesses.

⁽³⁾


⁽⁴⁾	“Other” primarily includes debt assumed, foreign currency translation on any debt instruments denominated in currencies other than the U.S. dollar, debt issuance costs incurred in connection with the term loan, and the impact of amortization of debt issuance costs associated with the term loan.

Schedule of per annum fees charged and the interest rate margins applicable to Eurodollar and alternate base rate loans



Consolidated Leverage Ratio	Domestic Revolving Commitment Fee		Global Revolving Commitment Fee		Letter of Credit Fee		Foreign Credit Commitment Fee		Foreign Credit Instrument Fee		LIBOR Rate Loans		ABR Loans
Greater than or equal to 3.00 to 1.0	0.350	%	0.350	%	2.000	%	0.350	%	1.250	%	2.000	%	1.000	%
Between 2.25 to 1.0 and 3.00 to 1.0	0.300	%	0.300	%	1.750	%	0.300	%	1.000	%	1.750	%	0.750	%
Between 1.50 to 1.0 and 2.25 to 1.0	0.275	%	0.275	%	1.500	%	0.275	%	0.875	%	1.500	%	0.500	%
Less than 1.50 to 1.0	0.250	%	0.250	%	1.375	%	0.250	%	0.800	%	1.375	%	0.375	%

Shareholders' Equity and Long-Term Incentive Compensation (Tables)

12 Months Ended

Dec. 31, 2018

SHAREHOLDERS' EQUITY AND STOCK-BASED COMPENSATION

Computations of the components used for the calculation of basic and diluted income per share

The following table sets forth the computations of the components used for the calculation of basic and diluted income (loss) per share:



	Year ended December 31,
	2018		2017		2016
Numerator:
Income from continuing operations	$	78.2	$	84.0	$	30.3
Less: Net loss attributable to noncontrolling interests	—		—		(0.4		)
Adjustment related to redeemable noncontrolling interest (Note 14)	—		—		(18.1		)
Income from continuing operations attributable to SPX Corporation common shareholders for calculating basic and diluted income per share	$	78.2	$	84.0	$	12.6
Income (loss) from discontinued operations, net of tax	$	3.0	$	5.3	$	(97.9	)
Less: Net loss attributable to noncontrolling interest	—		—		—
Income (loss) from discontinued operations attributable to SPX Corporation common shareholders for calculating basic and diluted income per share	$	3.0	$	5.3	$	(97.9	)
Denominator:
Weighted-average number of common shares used in basic income (loss) per share	43.054		42.413		41.610
Dilutive securities — Employee stock options, restricted stock shares and restricted stock units	1.606		1.492		0.551
Weighted-average number of common shares and dilutive securities used in diluted income (loss) per share	44.660		43.905		42.161

Summary of common shares issued, treasury shares and shares outstanding

Common shares issued, treasury shares and shares outstanding are summarized in the table below.



	Common Stock Issued		Treasury Stock		Shares Outstanding
December 31, 2015	100.526		(59.110	)	41.416
Restricted stock shares and restricted stock units	0.042		0.295		0.337
Retirement of treasury stock	(50.000	)	50.000		—
Other	0.187		—		0.187
December 31, 2016	50.755		(8.815	)	41.940
Restricted stock units	—		0.280		0.280
Other	0.431		—		0.431
December 31, 2017	51.186		(8.535	)	42.651
Restricted stock units	—		0.457		0.457
Other	0.343		—		0.343
December 31, 2018	51.529		(8.078	)	43.451

Schedule of assumptions to determine the fair value of restricted stock awards granted

We used the following assumptions in determining the fair value of these awards:



	Annual Expected Stock Price Volatility		Annual Expected Dividend Yield		Risk-Free Interest Rate		Correlation Between Total Shareholder Return for SPX and the Applicable S&P Index
February 22, 2018
SPX Corporation	42.25	%	—	%	2.38	%	0.3267
Peer group within S&P 600 Capital Goods Index	34.99	%	n/a		2.38	%
March 1, 2017
SPX Corporation	41.03	%	—	%	1.52	%	0.3685
Peer group within S&P 600 Capital Goods Index	34.49	%	n/a		1.52	%
March 2, 2016
SPX Corporation	36.91	%	—	%	0.97	%	0.3354
Peer group within S&P 600 Capital Goods Index	32.94	%	n/a		0.97	%

Schedule of restricted stock share and restricted stock unit activity

The following table summarizes the PSU, RSU, and RS activity from December 31, 2015 through December 31, 2018:



	Unvested PSU’s, RSU’s, and RS’s		Weighted-Average Grant-Date Fair Value Per Share
December 31, 2015	1.869		$	17.63
Granted	0.423		13.97
Vested	(0.528	)	10.32
Forfeited	(0.062	)	20.46
December 31, 2016	1.702		16.47
Granted	0.252		28.22
Vested	(0.483	)	18.17
Forfeited	(0.241	)	20.83
December 31, 2017	1.230		17.41
Granted	0.211		33.69
Vested	(0.753	)	15.39
Forfeited	(0.036	)	22.35
December 31, 2018	0.652		$	24.65

Schedule of assumptions used to estimate fair value of stock option grants

The fair value of each option grant was estimated using a Black-Scholes option-pricing model with the following assumptions:



	February 22, 2018		March 1, 2017		March 2, 2016
Annual expected stock price volatility	31.14	%	32.00	%	30.06	%
Annual expected dividend yield	—	%	—	%	—	%
Risk-free interest rate	2.75	%	2.14	%	1.50	%
Expected life of stock option (in years)	6.0		6.0		6.0

Schedule of stock option activity

The following table shows stock option activity from December 31, 2015 through December 31, 2018.



	Shares		Weighted- Average Exercise Price
Options outstanding at December 31, 2015	1.047		$	12.91
Granted	0.505		12.85
Options outstanding at December 31, 2016	1.552		12.89
Exercised	(0.125	)	20.67
Forfeited	(0.027	)	14.45
Granted	0.208		27.40
Options outstanding at December 31, 2017	1.608		14.67
Exercised	(0.064	)	13.89
Forfeited	(0.010	)	23.17
Granted	0.184		32.69
Options outstanding at December 31, 2018	1.718		$	16.58

Schedule of changes in the components of accumulated other comprehensive income

The changes in the components of accumulated other comprehensive income, net of tax, for the year ended December 31, 2018 were as follows:



	Foreign Currency Translation Adjustment			Net Unrealized Gains on Qualifying Cash Flow Hedges⁽¹⁾			Pension and Postretirement Liability Adjustment and Other⁽²⁾			Total
Balance at December 31, 2017	$	230.2		$	0.8		$	19.1		$	250.1
Other comprehensive loss before reclassifications	(4.4		)	(1.8		)	(1.0		)	(7.2		)
Amounts reclassified from accumulated other comprehensive income:
Impact of initial adoption of ASC 606 - See Note 3	—			(0.3		)	—			(0.3		)
Stranded income tax effects resulting from tax reform - See Note 3	—			0.2			4.6			4.8
Commodity contracts and amortization of prior service credits - See below	—			0.5			(3.0		)	(2.5		)
Current-period other comprehensive income (loss)	(4.4		)	(1.4		)	0.6			(5.2		)
Balance at December 31, 2018	$	225.8		$	(0.6	)	$	19.7		$	244.9

___________________________________________________________________


⁽¹⁾	Net of tax (provision) benefit of $0.2 and $(0.5) as of December 31, 2018 and 2017, respectively.

⁽²⁾Net of tax provision of $6.6 and $12.5 as of December 31, 2018 and 2017, respectively. The balances as of December 31, 2018 and 2017 include unamortized prior service credits.

The changes in the components of accumulated other comprehensive income, net of tax, for the year ended December 31, 2017 were as follows:



	Foreign Currency Translation Adjustment		Net Unrealized Losses on Qualifying Cash Flow Hedges(3)			Pension and Postretirement Liability Adjustment and Other(1)(4)			Total
Balance at December 31, 2016	$	229.7	$	1.5		$	3.9		$	235.1
Other comprehensive income before reclassifications ⁽¹⁾	0.5		2.3			16.3			19.1
Amounts reclassified from accumulated other comprehensive income ⁽²⁾	—		(3.0		)	(1.1		)	(4.1		)
Current-period other comprehensive income (loss)	0.5		(0.7		)	15.2			15.0
Balance at December 31, 2017	$	230.2	$	0.8		$	19.1		$	250.1

___________________________________________________________________


⁽¹⁾	As indicated in Note 10, we reduced our unfunded liability related to postretirement benefits and increased “Accumulated other comprehensive income” (before tax) by $26.8.


⁽²⁾	As indicated in Note 13, we discontinued hedge accounting for our Swaps resulting in a reclassification from “Accumulated other comprehensive income” (before tax) of $2.7.


⁽³⁾	Net of tax provision of $0.5 and $0.9 as of December 31, 2017 and 2016, respectively.


⁽⁴⁾	Net of tax provision of $12.5 and $2.7 as of December 31, 2017 and 2016, respectively. The balances as of December 31, 2017 and 2016 include unamortized prior service credits.

Schedule of amounts reclassified from each component of accumulated comprehensive income (loss)

The following summarizes amounts reclassified from each component of accumulated comprehensive income for the years ended December 31, 2018 and 2017:



	Amount Reclassified from AOCI						Affected Line Items in the Consolidated Statements of Operations
	Year ended December 31,
	2018			2017
(Gains) losses on qualifying cash flow hedges:
Commodity contracts	$	0.7		$	(2.5	)	Cost of products sold
Swaps	—			0.3			Interest expense
Swaps	—			(2.7		)	Other expense, net
Pre-tax	0.7			(4.9		)
Income taxes	(0.2		)	1.9
	$	0.5		$	(3.0	)
Pension and postretirement items:
Amortization of unrecognized prior service credits - Pre-tax	$	(4.2	)	$	(1.8	)	Other expense, net
Income taxes	1.2			0.7
	$	(3.0	)	$	(1.1	)

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

Tabular disclosure of an entity's stock, including par or stated value per share, number and dollar amount of share subscriptions, shares authorized, shares issued, shares outstanding, number and dollar amount of shares held in an employee trust, dividend per share, total dividends, share conversion features, par value plus additional paid in capital, the value of treasury stock and other information necessary to a fair presentation, and EPS information. Stock by class includes common, convertible, and preferred stocks which are not redeemable or redeemable solely at the option of the issuer. Includes preferred stock with redemption features that are solely within the control of the issuer and mandatorily redeemable stock if redemption is required to occur only upon liquidation or termination of the reporting entity. If more than one issue is outstanding, state the title of each issue and the corresponding dollar amount; dollar amount of any shares subscribed but unissued and the deduction of subscriptions receivable there from; number of shares authorized, issued, and outstanding.

+ References

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+ Details

Fair Value (Tables)

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Summarized below are the liability (related to the parent company guarantees and bank and surety bonds) and asset (related to the cash collateral and guarantee provided by mutares AG) recorded at the time of sale, along with the change in the liability and the asset during 2018 and 2017.



	Twelve months ended
	December 31, 2018						December 31, 2017
	Guarantees and Bonds Liability ⁽¹⁾			Indemnification Assets ⁽¹⁾			Guarantees and Bonds Liability ⁽¹⁾			Indemnification Assets ⁽¹⁾
Balance at beginning of year	$	8.7		$	2.8		$	9.9		$	4.8
Reduction/Amortization for the period ⁽²⁾	(4.1		)	(1.5		)	(2.5		)	(2.6		)
Impact of changes in foreign currency rates	(0.2		)	(0.1		)	1.3			0.6
Balance at end of period ⁽³⁾	$	4.4		$	1.2		$	8.7		$	2.8

___________________________

⁽¹⁾


⁽²⁾	We reduce the liability generally at the earlier of the completion of the related underlying project milestones or the expiration of the guarantees or bonds. We amortize the asset based on the expiration terms of each of the securities. We record the reduction of the liability and the amortization of the asset to “Other expense, net.”


⁽³⁾	Balance associated with the guarantees and bonds is reflected within “Other long-term liabilities,” while the balance associated with the indemnification assets is reflected within “Other assets.”

Quarterly Results (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2018

Quarterly Financial Information Disclosure [Abstract]

Schedule of quarterly results



	First ⁽⁴⁾				Second ⁽⁴⁾					Third ⁽⁴⁾					Fourth ⁽⁴⁾
	2018		2017		2018		2017			2018			2017		2018			2017
Operating revenues ⁽¹⁾	$	351.9	$	340.6	$	379.2	$	349.7		$	362.5		$	348.5	$	445.0		$	387.0
Gross profit ⁽¹⁾	90.1		88.1		97.7		76.1			87.7			85.1		135.2			80.9
Income (loss) from continuing operations, net of tax ⁽²⁾	12.4		10.3		19.7		(8.3		)	6.8			22.0		39.3			60.0
Income (loss) from discontinued operations, net of tax ⁽³⁾	—		7.1		3.3		(0.7		)	(0.2		)	0.3		(0.1		)	(1.4		)
Net income (loss)	$	12.4	$	17.4	$	23.0	$	(9.0	)	$	6.6		$	22.3	$	39.2		$	58.6
Basic income (loss) per share of common stock:
Continuing operations, net of tax	$	0.29	$	0.24	$	0.46	$	(0.19	)	$	0.16		$	0.51	$	0.91		$	1.41
Discontinued operations, net of tax	—		0.17		0.08		(0.02		)	(0.01		)	0.01		(0.01		)	(0.03		)
Net income (loss)	$	0.29	$	0.41	$	0.54	$	(0.21	)	$	0.15		$	0.52	$	0.90		$	1.38
Diluted income (loss) per share of common stock:
Continuing operations, net of tax	$	0.28	$	0.24	$	0.44	$	(0.19	)	$	0.15		$	0.50	$	0.88		$	1.35
Discontinued operations, net of tax	—		0.16		0.07		(0.02		)	—			0.01		—			(0.03		)
Net income (loss)	$	0.28	$	0.40	$	0.51	$	(0.21	)	$	0.15		$	0.51	$	0.88		$	1.32

___________________________________________________________________

Note: The sum of the quarters’ income per share may not equal the full year per share amounts.


⁽¹⁾	During the third quarter of 2018, we revised our estimates of revenues and costs, associated with our large power projects in South Africa. These revisions resulted in a charge to “Income (loss) from continuing operations before income taxes” of $4.7, which is comprised of a reduction in revenue of $2.7 and an increase in cost of products sold of $2.0.


⁽²⁾	During the third quarter of 2017, in connection with a favorable legal ruling, we reduced our unfunded liability related to postretirement benefits resulting in a pre-tax gain of $2.6. See Note 10 for additional details.

During the third quarter of 2017, we settled a contract that had been suspended and then ultimately cancelled by a customer of our Heat Transfer business, resulting in a pre-tax gain of $10.2.

⁽³⁾During the first quarter of 2017, we reduced the net loss on the sale of Balcke Dürr by $7.2.

During the second quarter of 2017, we increased the net loss on the sale of Balcke Dürr by $0.4.

See Note 4 for additional details on the above transactions.

Basis of Presentation and Summary of Significant Accounting Policies (Detail) - USD ($) shares in Thousands, $ in Millions			3 Months Ended		7 Months Ended	12 Months Ended
	Jun. 07, 2018	Dec. 30, 2016	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2018	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net loss incurred						$ (81.2)	$ (89.3)	$ 67.2
Gain (loss) on disposition of discontinued operations, net of tax						3.0	5.3	(81.3)
Business acquisition and other investments, net of cash acquired						180.8	0.0	$ 0.0
Retirement of treasury stock (in shares)								0
Amount of retirement of treasury stock								$ 0.0
Foreign Currency Translation and Transactions
Foreign currency transaction net losses						$ 0.3	$ 3.3	$ 2.4
Common Stock In Treasury
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Retirement of treasury stock (in shares)								(50,000)
Amount of retirement of treasury stock								$ (2,948.1)
Paid-In Capital
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Amount of retirement of treasury stock								1,285.4
Retained Earnings (Deficit)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Amount of retirement of treasury stock								$ 1,662.2
Balcke Durr \| Engineered Solutions reportable segment
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net loss incurred									$ 39.6
Balcke Durr
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on disposition of discontinued operations, net of tax			$ 3.8
Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on disposition of discontinued operations, net of tax			3.8
SPX Heat Transfer Business \| Disposal Group, Not Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Wind-down charges recorded			3.5
Proceeds from sale of intangible assets			4.8
Gain on sale of intangible assets			0.1
Subsidiary of mutares AG (the Buyer) \| Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on disposition of discontinued operations, net of tax		$ (78.6)
Cost of Sales \| SPX Heat Transfer Business \| Disposal Group, Not Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Wind-down charges related to inventories			0.9
Special Charges, Net \| SPX Heat Transfer Business \| Disposal Group, Not Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Wind-down charges related to impairment of machinery and equipment			0.6
Wind-down charges related to severance costs			2.0
Schonstedt Instrument Company
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Business acquisition and other investments, net of cash acquired				$ 16.4
Cash acquired				$ 0.3
Cues, Inc.
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net loss incurred					$ 0.4
Business acquisition and other investments, net of cash acquired	$ 164.4		164.4
Cash acquired	$ 20.6		$ 20.6

Basis of Presentation and Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Revenue from External Customer [Line Items]
Revenue under percentage of completion	$ 255.5	$ 336.1
Costs incurred on uncompleted contracts	1,261.3
Estimated earnings to date	(59.9)
Aggregate costs incurred on uncompleted contracts and estimated earnings to date	1,201.4
Billings to date	(1,202.0)
Net billings in excess of billings after acquisition	(0.6)
Costs in excess of billings	28.8
Billings in excess of cost	(29.4)
Net billings in excess of costs and estimated earnings	$ (0.6)

Basis of Presentation and Summary of Significant Accounting Policies - Research and Development (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Accounting Policies [Abstract]
Capitalized software, net of amortization	$ 6.2	$ 8.3
Capitalized software amortization expense	2.4	2.4	$ 1.2
Research and development expense	$ 22.9	$ 23.3	$ 29.1

Basis of Presentation and Summary of Significant Accounting Policies - Property, Plant and Equipment (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Property, Plant and Equipment [Line Items]
Depreciation expense, including amortization of capital leases	$ 22,600,000	$ 22,200,000	$ 22,500,000
Interest capitalized	$ 0	$ 0	$ 0
Buildings \| Maximum
Property, Plant and Equipment [Line Items]
Useful lives of property, plant and equipment (in years)	40 years
Machinery and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Useful lives of property, plant and equipment (in years)	15 years
Machinery and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Useful lives of property, plant and equipment (in years)	3 years

Use of Estimates (Details) - Allowance for Doubtful Accounts - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Allowance for Doubtful Accounts Receivable [Roll Forward]
Balance at beginning of year	$ 10.2	$ 10.1	$ 9.1
Allowances provided	17.7	13.2	15.7
Write-offs, net of recoveries, credits issued and other	(15.7)	(13.1)	(14.7)
Balance at end of year	$ 12.2	$ 10.2	$ 10.1

Use of Estimates - Accrued Expenses (Details) - USD ($) $ in Millions	Dec. 31, 2018	Jan. 01, 2018	Dec. 31, 2017	Dec. 31, 2016
Accounting Policies [Abstract]
Employee benefits	$ 68.5		$ 68.9
Unearned revenue	0.0		100.1
Warranty	12.0		13.8	$ 15.6
Other	103.2		109.8
Total	$ 183.7	$ 193.6	$ 292.6

Use of Estimates - Warranty (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Accounting Policies [Abstract]
Balance at beginning of year	$ 33.9	$ 35.8	$ 36.3
Acquisitions	1.0	0.0	0.0
Impact of initial adoption of ASC 606	0.4	0.0	0.0
Provisions	11.9	13.0	15.2
Usage	(13.1)	(15.4)	(15.5)
Currency translation adjustment	(0.1)	0.5	(0.2)
Balance at end of year	34.0	33.9	35.8
Less: Current portion of warranty	12.0	13.8	15.6
Non-current portion of warranty	$ 22.0	$ 20.1	$ 20.2

Use of Estimates - Narrative (Details) - Discontinued Operations, Disposed of by Sale - Balcke Durr - Subsidiary of mutares AG (the Buyer) - EUR (€) € in Millions	Dec. 31, 2018	Dec. 30, 2016
Guarantor Obligations [Line Items]
Amount of guarantees	€ 31.7	€ 79.0
Bank and Surety Bonds
Guarantor Obligations [Line Items]
Amount of guarantees	€ 21.8	€ 79.0

New Accounting Pronouncements - Application of ASC 606 (Details) - USD ($) $ in Millions	Dec. 31, 2018	Jan. 01, 2018	Dec. 31, 2017
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable, net	$ 269.1	$ 231.5	$ 267.5
Inventories, net	128.8	102.8	143.0
Contract assets	91.2	70.7	0.0
Other current assets	40.5	94.1	97.7
Deferred income taxes	24.4	50.0	50.9
Contract liabilities		86.9
Accrued expenses	183.7	193.6	292.6
Other long-term liabilities	817.3	884.2	885.8
Accumulated other comprehensive income	244.9	249.8	250.1
Retained deficit	(650.1)	(738.3)	(742.3)
Under Prior Revenue Recognition Guidance
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable, net	302.3		267.5
Inventories, net	180.9		143.0
Contract assets	0.0		0.0
Other current assets	44.6		97.7
Deferred income taxes	25.8		50.9
Contract liabilities			0.0
Accrued expenses	265.7		292.6
Other long-term liabilities	818.9		885.8
Accumulated other comprehensive income	245.9		250.1
Retained deficit	(655.6)		(742.3)
Difference between Revenue Guidance in Effect before and after Topic 606 \| Accounting Standards Update 2014-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounts receivable, net	33.2		(36.0)
Inventories, net	52.1	$ (40.2)	(40.2)
Contract assets	(91.2)		70.7
Other current assets	4.1		(3.6)
Deferred income taxes	1.4		(0.9)
Contract liabilities			86.9
Accrued expenses	82.0		(99.0)
Other long-term liabilities	1.6		(1.6)
Accumulated other comprehensive income	1.0		(0.3)
Retained deficit	$ (5.5)		$ 4.0

New Accounting Pronouncements (Narrative) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Jan. 01, 2019	Dec. 31, 2018	Jan. 01, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Retained deficit	$ 742.3			$ 650.1	$ 738.3
Accounting Standards Update 2016-01
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Impact of adoption of ASU Adoption					12.0
Accounting Standards Update 2016-15
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Proceeds (expenditures) related to company-owned life insurance policies, net	0.7	$ 7.7
Accounting Standards Update 2016-16
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Impact of adoption of ASU Adoption					(0.2)
Retained deficit					0.2
Accounting Standards Update 2017-07
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net periodic benefit income (expense)	$ 5.1	$ 15.0
Accounting Standards Update 2018-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Retained deficit					$ 4.8
Subsequent Event \| Scenario, Forecast \| Accounting Standards Update 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net lease assets			$ 35.0
Net lease liability			$ 35.0

Acquisitions, Discontinued Operations, and Other Dispositions - Acquisitions (Details) - USD ($) $ / shares in Units, $ in Millions		3 Months Ended		7 Months Ended	12 Months Ended
	Jun. 07, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2018	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Business Acquisition [Line Items]
Business acquisition and other investments, net of cash acquired					$ 180.8	$ 0.0	$ 0.0
Goodwill				$ 394.4	394.4	345.9	340.4
Net loss incurred					(81.2)	(89.3)	$ 67.2
Cues, Inc.
Business Acquisition [Line Items]
Business acquisition and other investments, net of cash acquired	$ 164.4	$ 164.4
Cash acquired	20.6	$ 20.6
Current assets, including cash and equivalents of $20.6	70.4
Cash and cash equivalents	20.6
Property, plant and equipment	7.4
Goodwill	48.6
Intangible assets	79.5
Other assets	2.3
Total assets acquired	208.2
Current liabilities assumed	7.8
Non-current liabilities assumed	15.4
Net assets acquired	185.0
Gross receivables acquired	13.6
Fair value of gross receivables acquired	13.2
Revenues and net losses				52.3
Net loss incurred				0.4
Charges associated with the excess fair value over historical cost of inventory acquired				$ 4.3
Business Acquisition, Pro Forma Information [Abstract]
Revenues					1,572.7	1,511.4
Income from continuing operations					87.1	87.4
Net income					$ 90.1	$ 92.7
Income from continuing operations per share - Basic (usd per share)					$ 2.02	$ 2.06
Income from continuing operations per share - Diluted (usd per share)					1.95	1.99
Net income per share - Basic (usd per share)					2.09	2.19
Net income per share - Diluted (usd per share)					$ 2.02	$ 2.11
Schonstedt Instrument Company
Business Acquisition [Line Items]
Business acquisition and other investments, net of cash acquired			$ 16.4
Cash acquired			$ 0.3
Trademarks \| Cues, Inc.
Business Acquisition [Line Items]
Intangible assets	27.6
Order or Production Backlog \| Cues, Inc.
Business Acquisition [Line Items]
Intangible assets	$ 0.8
Finite-lived intangible assets amortization period (in years)	6 months
Customer relationships \| Cues, Inc.
Business Acquisition [Line Items]
Intangible assets	$ 42.6
Finite-lived intangible assets amortization period (in years)	12 years
Technology \| Cues, Inc.
Business Acquisition [Line Items]
Intangible assets	$ 8.5
Finite-lived intangible assets amortization period (in years)	11 years
Selling, General and Administrative Expenses \| Cues, Inc.
Business Acquisition [Line Items]
Acquisition related costs					$ 2.4

Acquisitions, Discontinued Operations, and Other Dispositions - Sale of Blacke Durr Business (Details) € in Millions, $ in Millions		3 Months Ended	12 Months Ended
	Dec. 30, 2016 USD ($)	Jun. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2018 EUR (€)	Dec. 30, 2016 EUR (€)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash consideration, exclusive of cash transferred					$ 30.2
Gain (loss) on sale of business, net of tax			$ (3.0)	$ (5.3)	$ 81.3
Balcke Durr
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on sale of business, net of tax		$ (3.8)
Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on sale of business, net of tax		$ (3.8)
Subsidiary of mutares AG (the Buyer) \| Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash consideration, exclusive of cash transferred	$ 0.1
Cash transferred with sale of business	21.1
Gain (loss) on sale of business, net of tax	78.6
Amount of guarantees \| €						€ 31.7	€ 79.0
Bank and Surety Bonds \| Subsidiary of mutares AG (the Buyer) \| Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Amount of guarantees \| €						21.8	79.0
Guarantees and Bonds \| Subsidiary of mutares AG (the Buyer) \| Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on sale of business, net of tax	$ 5.1
Balcke-Durr GmbH \| Subsidiary of mutares AG (the Buyer) \| Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash collateral \| €						3.0	4.0
mutares AG \| Indemnification Agreement \| SPXC \| Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Amount of guarantees \| €						€ 5.0	€ 5.0

Acquisitions, Discontinued Operations, and Other Dispositions - Consolidated Statements (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss from discontinued operations	$ 0.0	$ 0.0	$ (16.6)
Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenues			153.4
Costs of products sold			144.2
Selling, general and administrative			31.4
Special charges (credits), net			(1.3)
Other expense, net			(0.2)
Loss before taxes			(21.1)
Income tax benefit		9.4	4.5
Loss from discontinued operations		$ (6.8)	(16.6)
Depreciation and amortization			2.0
Capital expenditures			$ 0.7

Acquisitions, Discontinued Operations, and Other Dispositions - Narrative (Details) € in Millions, $ in Millions		3 Months Ended	12 Months Ended
	Mar. 30, 2016 USD ($)	Jun. 30, 2018 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Jun. 30, 2018 EUR (€)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss from discontinued operations, net of tax			$ 0.0	$ 0.0	$ 16.6
Gain (loss) on disposition of discontinued operations, net of tax			3.0	5.3	(81.3)
Cash consideration, exclusive of cash transferred					30.2
Gain (loss) on sale of dry cooling business			0.0	0.0	18.4
Balcke Durr
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on disposition of discontinued operations, net of tax		$ 3.8
Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss from discontinued operations, net of tax				6.8	16.6
Income tax benefit				9.4	4.5
Net gain \| €						€ 3.0
Gain (loss) on disposition of discontinued operations, net of tax		$ 3.8
Other businesses included in discontinued operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net loss recognized with disposition of business			$ 0.8	$ 1.5	2.7
Dry Cooling Business \| Disposal Group, Disposed of by Sale, Not Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash consideration, exclusive of cash transferred	$ 47.6
Cash transferred with sale of business	3.0
Gain (loss) on sale of dry cooling business	18.4				$ 18.4
Amount Reclassified from AOCI \| Accumulated Foreign Currency Adjustment Including Portion Attributable to Noncontrolling Interest \| Dry Cooling Business \| Disposal Group, Disposed of by Sale, Not Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on sale of dry cooling business	$ 40.4

Acquisitions, Discontinued Operations, and Other Dispositions - Results of Operations (Details) - USD ($) $ in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 29, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jul. 01, 2017	Apr. 01, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Income before taxes									$ 5.1	$ (6.6)	$ (110.7)
Income tax provision									(2.1)	11.9	12.8
Income (loss) from discontinued operations, net of tax	$ (0.1)	$ (0.2)	$ 3.3	$ 0.0	$ (1.4)	$ 0.3	$ (0.7)	$ 7.1	3.0	5.3	(97.9)
Balcke Durr \| Discontinued Operations, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Income before taxes									6.3	(2.6)	(107.0)
Income tax provision									(2.5)	9.4	11.8
Income (loss) from discontinued operations, net of tax									3.8	6.8	(95.2)
ALL Other Discontinued Operations
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Income before taxes									(1.2)	(4.0)	(3.7)
Income tax provision									0.4	2.5	1.0
Income (loss) from discontinued operations, net of tax									$ (0.8)	$ (1.5)	$ (2.7)

Amount before tax of income (loss) from a discontinued operation. Includes, but is not limited to, the income (loss) from operations during the phase-out period, gain (loss) on disposal, gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and adjustments to a prior period gain (loss) on disposal.

Amount of tax expense (benefit) related to a discontinued operation. Includes, but is not limited to, tax expense (benefit) related to income (loss) from operations during the phase-out period, tax expense (benefit) related to gain (loss) on disposal, tax expense (benefit) related to gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and tax expense (benefit) related to adjustments of a prior period gain (loss) on disposal.

Amount after tax of income (loss) from a discontinued operation including the portion attributable to the noncontrolling interest. Includes, but is not limited to, the income (loss) from operations during the phase-out period, gain (loss) on disposal, gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and adjustments to a prior period gain (loss) on disposal.