aimc-10q_20200930.htm

aimc-10q_20200930.htm

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2020

or

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-33209

ALTRA INDUSTRIAL MOTION CORP.

(Exact name of registrant as specified in its charter)

Delaware		61-1478870
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

300 Granite Street, Suite 201, Braintree, MA		02184
(Address of principal executive offices)		(Zip Code)

(781) 917-0600

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value	AIMC	NASDAQ Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer		☒		Accelerated filer		☐

Non-accelerated filer		☐		Smaller reporting company		☐

				Emerging growth company		☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October 27, 2020, there were 64,714,022 outstanding shares of the registrant’s common stock, $0.001 par value per share.

TABLE OF CONTENTS

				Page #
PART I - FINANCIAL INFORMATION
Item 1.		Financial Statements (unaudited)		1
		Condensed Consolidated Balance Sheets		1
		Condensed Consolidated Statement of Operations		2
		Condensed Consolidated Statements of Comprehensive Income		3
		Condensed Consolidated Statements of Cash Flows		4
		Condensed Consolidated Statements of Stockholders’ Equity		5
		Notes to Unaudited Condensed Consolidated Interim Financial Statements		7
Item 2.		Management’s Discussion and Analysis of Financial Condition and Results of Operations		25
Item 3.		Quantitative and Qualitative Disclosures About Market Risk		37
Item 4.		Controls and Procedures		37

PART II - OTHER INFORMATION
Item 1.		Legal Proceedings		38
Item 1A.		Risk Factors		38
Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds		38
Item 3.		Defaults Upon Senior Securities		38
Item 4.		Mine Safety Disclosures		38
Item 5.		Other Information		38
Item 6.		Exhibits		39

SIGNATURES				40

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

ALTRA INDUSTRIAL MOTION CORP.

Condensed Consolidated Balance Sheets

Amounts in millions, except share amounts

		September 30, 2020				December 31, 2019
		(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	238.7			$	167.3
Trade receivables, less allowance for credit losses of $5.7 and $5.1 million at September 30, 2020 and December 31, 2019, respectively			237.0				243.2
Inventories			219.2				222.5
Income tax receivable			13.6				5.2
Prepaid expenses and other current assets			35.4				29.1
Total current assets			743.9				667.3
Property, plant and equipment, net			336.7				354.4
Goodwill			1,563.4				1,694.9
Intangible assets, net			1,451.9				1,502.4
Deferred income taxes			1.0				3.0
Other non-current assets			9.2				25.1
Operating lease right of use assets			39.8				36.6
Total assets		$	4,145.9			$	4,283.7
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	139.9			$	154.7
Accrued payroll			63.1				58.3
Accruals and other current liabilities			77.4				82.0
Income tax payable			10.0				13.2
Current portion of long-term debt			16.5				18.0
Operating lease liabilities			12.7				13.5
Total current liabilities			319.6				339.7
Long-term debt - less current portion			1,476.9				1,563.8
Deferred income taxes			374.0				369.1
Pension liabilities			31.4				30.8
Long-term taxes payable			2.7				4.5
Other long-term liabilities			16.3				28.8
Operating lease liabilities, net of current portion			29.2				24.7
Commitments and Contingencies (Note 16)
Stockholders’ equity:
Common stock ($0.001 par value per share, 120,000,000 shares authorized, 64,665,347 and 64,222,603 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively)			0.1				0.1
Additional paid-in capital			1,703.1				1,696.7
Retained earnings			242.3				315.4
Accumulated other comprehensive loss			(49.7	)			(89.9	)
Total stockholders’ equity			1,895.8				1,922.3
Total liabilities and stockholders’ equity		$	4,145.9			$	4,283.7

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

1

ALTRA INDUSTRIAL MOTION CORP.

Condensed Consolidated Statements of Operations

Amounts in millions, except per share data

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2
Cost of sales			273.7				285.9				812.3				893.3
Gross profit			164.1				157.0				460.5				498.9
Operating expenses:
Selling, general and administrative expenses			82.5				87.9				245.4				270.8
Impairment of goodwill and intangible asset			—				—				147.5				—
Research and development expenses			13.8				14.4				42.6				44.4
Restructuring costs			2.4				6.2				5.5				11.7
			98.7				108.5				441.0				326.9
Income from operations			65.4				48.5				19.5				172.0
Other non-operating income and expense:
Interest expense, net			18.0				18.2				54.2				56.6
Other non-operating expense/(income), net			(0.3	)			(0.4	)			0.8				1.1
			17.7				17.8				55.0				57.7
Income/(Loss) before income taxes			47.7				30.7				(35.5	)			114.3
Provision for income taxes			9.4				5.0				21.2				24.4
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9
Weighted average shares, basic			64.6				64.4				64.6				64.3
Weighted average shares, diluted			64.9				64.6				64.6				64.5
Net income/(loss) per share:
Basic		$	0.59			$	0.40			$	(0.88	)		$	1.40
Diluted		$	0.59			$	0.40			$	(0.88	)		$	1.39
Cash dividend declared per share		$	0.04			$	0.17			$	0.25			$	0.51

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

2

ALTRA INDUSTRIAL MOTION CORP.

Condensed Consolidated Statements of Comprehensive Income

(Amounts in millions)

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
		(Unaudited)				(Unaudited)				(Unaudited)				(Unaudited)
Net Income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9
Other Comprehensive income:
Foreign currency translation adjustment			47.6				(58.7	)			16.5				(66.3	)
Change in pension liability adjustment			0.2				—				0.1				(0.3	)
Non-cash amortization of interest rate swap expense, net of tax			2.6				—				4.3				—
Change in fair value of derivative financial instruments, net of tax			—				25.5				19.3				23.0
Total other comprehensive income/(loss):			50.4				(33.2	)			40.2				(43.6	)
Comprehensive income/(loss)		$	88.7			$	(7.5	)		$	(16.5	)		$	46.3

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

3

ALTRA INDUSTRIAL MOTION CORP.

Condensed Consolidated Statements of Cash Flows

(Amounts in millions)

		Year to Date Ended
		September 30, 2020				September 30, 2019
		(Unaudited)				(Unaudited)
Cash flows from operating activities
Net (loss)/income		$	(56.7	)		$	89.9
Adjustments to reconcile net income to net operating cash flows:
Depreciation			44.2				43.5
Amortization of intangible assets			52.3				52.9
Amortization of deferred financing costs			3.4				3.8
Loss on foreign currency, net			(1.2	)			(0.5	)
Accretion of debt discount			0.4				—
Non-cash amortization of interest rate swap expense			5.6				—
Impairment of goodwill and intangible asset			147.5				—
Payment for interest rate swap settlement			(34.7	)			—
Loss on disposal and other			—				0.2
Stock-based compensation			10.3				10.1
Changes in assets and liabilities:
Trade receivables			7.9				10.2
Inventories			4.3				(3.7	)
Accounts payable, accrued payroll, accruals and current liabilities			(2.7	)			(15.3	)
Other current assets and liabilities			(23.2	)			(10.3	)
Other operating assets and liabilities			4.4				(0.4	)
Net cash provided by operating activities			161.8				180.4
Cash flows from investing activities
Purchase of property, plant and equipment			(24.3	)			(36.9	)
A&S acquisition purchase price adjustment			(1.9	)			(13.5	)
Proceeds from sale of building			—				0.4
Proceeds from cross currency interest rate swap settlement			56.2				—
Net cash provided by (used in) investing activities			30.0				(50.0	)
Cash flows from financing activities
Borrowing under Revolving Credit Facility			100.0				—
Payments on Revolving Credit Facility			(100.0	)			—
Payments on Term Loan Facility			(90.0	)			(90.0	)
Dividend payments			(24.9	)			(33.1	)
Net payments on financing leases, mortgages, and other obligations			(0.3	)			(0.9	)
Net proceeds/(payments) from China debt			(1.1	)			2.1
Shares surrendered for tax withholding			(3.9	)			(3.9	)
Net cash used in financing activities			(120.2	)			(125.8	)
Effect of exchange rate changes on cash and cash equivalents			(0.2	)			(5.6	)
Net change in cash and cash equivalents			71.4				(1.0	)
Cash and cash equivalents at beginning of period			167.3				169.0
Cash and cash equivalents at end of period		$	238.7			$	168.0
Cash paid during the period for:
Interest paid on borrowings		$	38.8			$	33.8
Income taxes paid		$	43.5			$	37.1

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

4

ALTRA INDUSTRIAL MOTION CORP.

Condensed Consolidated Statements of Stockholders’ Equity

Amounts in millions

(Unaudited)

		Common Stock				Shares				Additional Paid in Capital				Retained Earnings				Accumulated Other Comprehensive Income (Loss)				Total
Balance at January 1, 2020		$	0.1				64.2			$	1,696.7			$	315.4			$	(89.9	)		$	1,922.3
Stock-based compensation and vesting of restricted stock, net of withholdings			—				0.5				6.4				—				—				6.4
Net loss			—				—				—				(56.7	)			—				(56.7	)
Dividends declared, $0.25 per share			—				—				—				(16.4	)			—				(16.4	)
Change in fair value of derivative financial instruments, net of tax			—				—				—				—				19.3				19.3
Non-cash amortization of interest rate swap expense, net of tax																			4.3				4.3
Minimum pension adjustment, net of tax			—				—				—				—				0.1				0.1
Cumulative foreign currency translation adjustment			—				—				—				—				16.5				16.5
Balance at September 30, 2020		$	0.1				64.7			$	1,703.1			$	242.3			$	(49.7	)		$	1,895.8
Balance at June 30, 2020		$	0.1				64.6			$	1,701.8			$	206.7			$	(100.1	)		$	1,808.5
Stock-based compensation and vesting of restricted stock, net of withholdings			—				0.1				1.3				—				—				1.3
Net income			—				—				—				38.3				—				38.3
Dividends declared, $0.04 per share			—				—				—				(2.7	)			—				(2.7	)
Change in fair value of derivative financial instruments, net of tax			—				—				—				—				—				—
Non-cash amortization of interest rate swap expense, net of tax																			2.6				2.6
Minimum pension adjustment, net of tax			—				—				—				—				0.2				0.2
Cumulative foreign currency translation adjustment			—				—				—				—				47.6				47.6
Balance at September 30, 2020		$	0.1				64.7			$	1,703.1			$	242.3			$	(49.7	)		$	1,895.8

5

		Common Stock				Shares				Additional Paid in Capital				Retained Earnings				Accumulated Other Comprehensive Income (Loss)				Total
Balance at January 1, 2019		$	0.1				64.2			$	1,687.1			$	232.6			$	(71.6	)		$	1,848.2
Stock-based compensation and vesting of restricted stock, net of withholdings			—				0.3				6.2				—				—				6.2
Net income			—				—				—				89.9				—				89.9
Dividends declared, $0.51 per share			—				—				—				(33.2	)			—				(33.2	)
Change in fair value of derivative financial instruments, net of tax			—				—				—				—				23.0				23.0
Minimum pension adjustment, net of tax			—				—				—				—				(0.3	)			(0.3	)
Cumulative foreign currency translation adjustment			—				—				—				—				(66.3	)			(66.3	)
Balance at September 30, 2019		$	0.1				64.5			$	1,693.3			$	289.3			$	(115.2	)		$	1,867.5
Balance at June 30, 2019		$	0.1				64.3			$	1,691.8			$	274.5			$	(82.0	)		$	1,884.4
Stock-based compensation and vesting of restricted stock, net of withholdings			—				0.2				1.5				—				—				1.5
Net income			—				—				—				25.7				—				25.7
Dividends declared, $0.17 per share			—				—				—				(10.9	)			—				(10.9	)
Change in fair value of derivative financial instruments, net of tax			—				—				—				—				25.5				25.5
Minimum pension adjustment, net of tax			—				—				—				—				—				—
Cumulative foreign currency translation adjustment			—				—				—				—				(58.7	)			(58.7	)
Balance at September 30, 2019		$	0.1				64.5			$	1,693.3			$	289.3			$	(115.2	)		$	1,867.5

The accompanying notes are an integral part of these unaudited condensed consolidated interim financial statements.

6

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

1. Organization and Nature of Operations

Headquartered in Braintree, Massachusetts, Altra Industrial Motion Corp. (the “Company,” “Altra,” “we,” or “our”) is a leading global designer, producer and marketer of a wide range of electro-mechanical power transmission and motion control products. The Company brings together strong brands with production facilities in seventeen countries. Altra’s leading brands include Ameridrives Couplings, Bauer Gear Motor, Bibby Turboflex, Boston Gear, Delroyd Worm Gear, Formsprag Clutch, Guardian Couplings, Huco, Industrial Clutch, Inertia Dynamics, Jacobs Vehicle Systems, Kilian Manufacturing, Kollmorgen, Lamiflex Couplings, Marland Clutch, Matrix, Nuttall Gear, Portescap, Stieber Clutch, Stromag, Svendborg Brakes, TB Wood’s, Thomson, Twiflex, Warner Electric, Warner Linear, and Wichita Clutch.

2. Basis of Presentation

The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the United States, or GAAP. These statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 27, 2020 (the “2019 Annual Report on Form 10-K”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary to present fairly the Company’s financial position and cash flows for the interim periods presented. The results are not necessarily indicative of future results. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure.

3. Recent Accounting Standards

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires the use of the current expected credit loss impairment model to estimate credit losses on certain types of financial instruments, including trade receivables. The model requires an estimate of expected credit losses, measured over the contractual life of an asset, that considers information about past events, current conditions and a forecast of future economic conditions. The Company adopted the standard on January 1, 2020. The adoption of the standard did not have a material impact on our consolidated financial statements.

As a result of the adoption of ASU 2016-13, the Company has updated its significant accounting policy related to trade account receivables and allowances for credit losses as of March 31, 2020 from what was previously disclosed in our audited financial statements for the year ended December 31, 2019 as follows:

All trade account receivables are reported net of allowances for credit losses. The allowances for credit losses represent management’s best estimate of the credit losses expected from our trade account receivables over the life of the underlying assets. Assets with similar risk characteristics are pooled together for determination of their current expected credit losses. We regularly perform detailed reviews of our pooled assets to evaluate the collectability of receivables based on a combination of past, current, and future financial and qualitative factors that may affect customers’ ability to pay. In circumstances where we are aware of a specific customer’s inability to meet its financial obligations, a specific reserve is recorded against amounts due to reduce the recognized receivable to the amount reasonably expected to be collected.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). The amendments in ASU 2018-13 modify the disclosure requirements on fair value measurements. The Company adopted the standard on January 1, 2020. The adoption of the standard did not have a material impact on our consolidated financial statements.

7

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). This ASU provides relief from certain accounting consequences that could result from the global markets’ anticipated transition away from the use of the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. The relief provided by this ASU is elective and applies to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The optional amendments are effective as of March 12, 2020 through December 31, 2022. The Company is currently evaluating the effect of the adoption of this standard on the Company.

4. Revenue Recognition

We sell our products through three primary commercial channels: original equipment manufacturers (OEMs), industrial distributors and direct to end users. Each of our segments sells similar products, which are balanced across end-user industries including, without limitation, energy, food processing, general industrial, material handling, mining, transportation, industrial automation, robotics, medical devices, and turf & garden.

As the Company’s standard payment terms are less than one year, the Company has elected the practical expedient under ASC 606-10-32-18 to not assess whether a contract has a significant financing component. Revenue is recognized when control of the product is transferred to the customer (i.e., when the Company’s performance obligation is satisfied), which typically occurs at shipment from the Company’s manufacturing site or delivery to the customer’s named location. In determining whether control has transferred, the Company considers if there is a present right to payment and legal title, along with risks and rewards of ownership having transferred to the customer. In certain circumstances, the Company manufactures customized product without alternative use for its customers, which would generally result in the transfer of control over time. The Company has evaluated the amount of revenue subject to recognition over time and concluded that it is immaterial.

The following table disaggregates our revenue for each reportable segment. The Company believes that disaggregating revenue into these categories achieves the disclosure objective to depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net Sales:
Power Transmission Technologies		$	197.7			$	218.7			$	610.7			$	688.6
Automation & Specialty			240.8				224.8				665.2				707.2
Inter-segment eliminations			(0.7	)			(0.6	)			(3.1	)			(3.6	)
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2

Net sales by geographic region based on point of shipment origin are as follows:

		Net Sales
		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
North America (primarily U.S.)		$	230.2			$	251.5			$	681.3			$	794.3
Europe excluding Germany			68.8				72.1				214.9				233.8
Germany			44.1				54.9				140.7				173.9
China			56.5				35.1				150.1				105.8
Asia and other (excluding China)			38.2				29.3				85.8				84.4
Total		$	437.8			$	442.9			$	1,272.8			$	1,392.2

8

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

The payment terms and conditions in our customer contracts vary. In some cases, customers will partially prepay for their goods; in other cases, after appropriate credit evaluations, payment will be due in arrears. In addition, there are constraints that cause variability in the ultimate consideration to be recognized. These constraints typically include early payment discounts, volume rebates, rights of return, surcharges, and other customer considerations.

A contract asset is created when the Company satisfies a performance obligation by transferring a promised good to the customer. Contract assets may represent conditional or unconditional rights to consideration. A right is conditional, and recorded as a contract asset, if, for example, the Company must first satisfy another performance obligation in the contract before it is entitled to payment from the customer. Contract assets are transferred to accounts receivable once the right becomes unconditional. A right is unconditional if nothing other than the passage of time is required before payment of that consideration is due. If the Company receives a customer payment prior to satisfying a performance obligation or in excess of estimates of what the Company expects to be entitled to, the payment is recorded as a contract liability. Contracts with payment in arrears are recognized as receivables.

The opening and closing balances of the Company’s contract liability and accounts receivable as of the year to date period ended September 30, 2020 are as follows:

		Deferred Revenue (Current)				Accounts Receivable
Beginning - January 1, 2020		$	8.4			$	243.2
Closing - September 30, 2020			11.2				237.0
Increase/(Decrease)		$	2.8			$	(6.2	)

		Deferred Revenue (Current)				Accounts Receivable
Beginning - January 1, 2019		$	7.4			$	259.8
Closing - September 30, 2019			10.6				244.3
Increase/(Decrease)		$	3.2			$	(15.5	)

In the nine-month period ended September 30, 2020, substantially all outstanding revenue has been recognized related to contract liabilities outstanding at January 1, 2020.

5. Fair Value of Financial Instruments

Fair value is determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, as determined by either the principal market or the most advantageous market. Inputs used in the valuation techniques to derive fair values are classified based on a three-level hierarchy, as follows:

•

Level 1- Quoted prices in active markets for identical assets or liabilities.

•

Level 2- Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived.

•

Level 3- Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities.

The Company considers all highly liquid investments purchased with a remaining maturity of three months or less to be cash equivalents and are classified as Level 1.

9

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

The Company determines the fair value of financial instruments using quoted market prices whenever available. When quoted market prices are not available for various types of financial instruments (such as forwards, options and swaps), the Company uses standard models with market-based inputs, which take into account the present value of estimated future cash flows and the ability of the Company or the financial counterparty to perform. For interest rate and cross currency swaps, the significant inputs to these models are interest rate curves for discounting future cash flows and are adjusted for credit risk. For forward foreign currency contracts, the significant inputs are interest rate curves for discounting future cash flows and exchange rate curves of the foreign currency for translating future cash flows. See additional discussion of the Company’s use of financial instruments including cross-currency swaps and interest rate swaps included in Note 15.

The carrying values of financial instruments, including cash equivalents, accounts payable, and other accrued liabilities are carried at cost, which approximates fair value. Debt under the Altra Credit Agreement (as defined herein) is comprised of the Altra Term Loan Facility and the Altra Revolving Credit Facility (both as defined herein). The carrying amount of the Altra Term Loan Facility was $1,100.0 million and the estimated fair value of the Altra Term Loan Facility was $1,071.1 million at September 30, 2020. There is currently no debt under the Altra Revolving Credit Facility. Further, the Altra Credit Agreement was negotiated in October 2018 and there have not been any significant changes in our credit rating. The carrying amount of the Notes (as defined herein) was $400 million and the estimated fair value of the Notes was $425.0 million at September 30, 2020.

6. Changes in Accumulated Other Comprehensive Income/(Loss) by Component

The following is a reconciliation of changes in accumulated other comprehensive income/(loss) by component for the periods presented:

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, June 30, 2020		$	18.0			$	(1.6	)		$	(116.5	)		$	(100.1	)
Other Comprehensive Income (Loss) before reclassification			—				0.2				47.6				47.8
Reclassification out of Other Comprehensive Income (Loss)			2.6				—				—				2.6
Net current-period Other Comprehensive Income (Loss)			2.6				0.2				47.6				50.4
Accumulated Other Comprehensive (Loss) by Component, September 30, 2020		$	20.6			$	(1.4	)		$	(68.9	)		$	(49.7	)

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, January 1, 2020		$	(3.0	)		$	(1.5	)		$	(85.4	)		$	(89.9	)
Other Comprehensive Income (Loss) before reclassification			19.9				0.1				16.5				36.5
Reclassification out of Other Comprehensive Income (Loss)			3.7				—				—				3.7
Net current-period Other Comprehensive Income (Loss)			23.6				0.1				16.5				40.2
Accumulated Other Comprehensive (Loss) by Component, September 30, 2020		$	20.6			$	(1.4	)		$	(68.9	)		$	(49.7	)

10

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, June 30, 2019		$	(15.4	)		$	(0.5	)		$	(66.1	)		$	(82.0	)
Other Comprehensive Income (Loss) before reclassfication			27.9				—				(58.7	)			(30.8	)
Reclassification out of Other Comprehensive Income (Loss)			(2.4	)			—				—				(2.4	)
Net current-period Other Comprehensive Income (Loss)			25.5				—				(58.7	)			(33.2	)
Accumulated Other Comprehensive (Loss) by Component, September 30, 2019		$	10.1			$	(0.5	)		$	(124.8	)		$	(115.2	)

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, January 1, 2019		$	(12.9	)		$	(0.2	)		$	(58.5	)		$	(71.6	)
Other Comprehensive Income (Loss) before reclassfication			30.4				(0.3	)			(66.3	)			(36.2	)
Reclassification out of Other Comprehensive Income (Loss)			(7.4	)			—				—				(7.4	)
Net current-period Other Comprehensive Income (Loss)			23.0				(0.3	)			(66.3	)			(43.6	)
Accumulated Other Comprehensive (Loss) by Component, September 30, 2019		$	10.1			$	(0.5	)		$	(124.8	)		$	(115.2	)

7. Net Income per Share

Basic earnings per share is based on the weighted average number of shares of common stock outstanding, and diluted earnings per share is based on the weighted average number of shares of common stock outstanding and all potentially dilutive common stock equivalents outstanding. Common stock equivalents are included in the per share calculations when the effect of their inclusion is dilutive.

11

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

The following is a reconciliation of basic to diluted net income per share:

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9
Shares used in net income per common share - basic			64.6				64.4				64.6				64.3
Incremental shares of unvested restricted common stock			0.3				0.2				—				0.2
Shares used in net income per common share - diluted			64.9				64.6				64.6				64.5
Shares excluded as their inclusion would be anti-dilutive			—				—				0.1				—
Earnings/(Loss) per share:
Basic net income		$	0.59			$	0.40			$	(0.88	)		$	1.40
Diluted net income		$	0.59			$	0.40			$	(0.88	)		$	1.39

8. Inventories

Inventories at September 30, 2020 and December 31, 2019 consisted of the following:

		September 30, 2020				December 31, 2019
Raw materials		$	102.0			$	104.2
Work in process			23.0				22.4
Finished goods			94.2				95.9
		$	219.2			$	222.5

9. Goodwill and Intangible Assets

The Company conducts an annual impairment review of goodwill and indefinite-lived intangible assets in fourth quarter of each year, unless events occur which trigger the need for an interim impairment review. The 2019 annual goodwill impairment review indicated that the JVS reporting unit’s fair value exceeded its carrying value by less than 10%. All other reporting units had fair values that exceeded their carrying value by 10% or more.

During the first quarter of 2020, the Company considered the economic impact of the COVID-19 pandemic to be a triggering event for the JVS business unit and, as a result, the Company performed an interim impairment review. As a result of both the COVID-19 related economic downturn and its impact on JVS’s anticipated financial results, the Company concluded that it was more likely than not that the JVS reporting unit’s carrying value exceeded its fair value and performed an interim impairment review for both JVS’s goodwill and tradename intangible asset. As a result of the interim impairment testing performed on March 31, 2020, the Company recorded non-cash impairment charges of $8.4 million and $139.1 million for indefinite-lived intangible assets and goodwill, respectively.

The Company estimated the fair value of the JVS reporting unit using both the discounted cash flow model and the market approach. The Company estimated the value of JVS’s indefinite-lived tradename intangible asset using a discounted cash flow model. The determination of the fair value using the discounted cash flow model requires management to make significant estimates and assumptions related to forecasts of future revenues, profit margins, and discount rates. The determination of the fair value using the market approach requires management to make significant assumptions related to earnings before interest, taxes, depreciation, and amortization (“EBITDA”) multiples. The Company estimates future cash flows based upon historical results and current market projections, discounted at a market comparable rate.

12

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

Key assumptions developed by management and used in the interim quantitative analysis included the following:

•

Near-term revenue declines in 2020;

•

Adjusted profit margins over the projection period, due to revenue adjustments and maintained investment in the business

•

Market-based discount rates; and

•

Reduced EBITDA multiple, due to current market conditions.

During the third quarter of 2020, the Company again considered the economic impact of the COVID-19 pandemic on the reporting units and determined there was no triggering event to further evaluate for potential impairment. For all reporting units, the Company concluded that it was more likely than not that their fair value continued to exceed their carrying value as of September 30, 2020. However, depending on its duration and the severity of its economic impact, the COVID-19 pandemic may trigger additional interim impairment reviews in future periods.

Changes in goodwill from January 1, 2020 through September 30, 2020 were as follows:

		Power Transmission Technologies				Automation & Specialty				Total
Net goodwill balance January 1, 2020		$	410.1			$	1,284.8			$	1,694.9
Goodwill impairment charge			—				(139.1	)			(139.1	)
Impact of changes in foreign currency			4.4				3.2				7.6
Net goodwill balance September 30, 2020		$	414.5			$	1,148.9			$	1,563.4

Other intangible assets as of September 30, 2020 and December 31, 2019 consisted of the following:

		September 30, 2020												December 31, 2019
		Cost				Accumulated Amortization				Net				Cost				Accumulated Amortization				Net
Other intangible assets
Intangible assets not subject to amortization:
Tradenames and trademarks (1)		$	254.1			$	—			$	254.1			$	260.0			$	—			$	260.0
In-process research and development			16.0				—				16.0				16.0				—				16.0
Intangible assets subject to amortization:
Customer relationships			1,197.0				176.1				1,020.9				1,187.7				137.8				1,049.9
Product technology and patents			210.5				49.6				160.9				210.0				33.5				176.5
Total intangible assets		$	1,677.6			$	225.7			$	1,451.9			$	1,673.7			$	171.3			$	1,502.4

(1)	The change in Cost of Tradenames and trademarks is a result of the $8.4 million impairment charge in the quarter-end March 31, 2020 related to the JVS reporting unit.

The Company recorded $17.5 million and $17.6 million of amortization expense in the quarters ended September 30, 2020 and 2019, respectively; and, recorded $52.3 million and $52.9 million of amortization expense in the year to date periods ended September 30, 2020 and 2019, respectively.

The estimated amortization expense for intangible assets is approximately $18.4 million for the remainder of 2020, $70.7 million in each of the next four years and then $880.6 million thereafter.

13

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

10. Warranty Costs

The contractual warranty period of the Company's products generally ranges from three months to two years with certain warranties extending for longer periods. Estimated expenses related to product warranties are accrued at the time products are sold to customers and are recorded in accruals and other current liabilities on the unaudited condensed consolidated balance sheets. Estimates are established using historical information as to the nature, frequency and average costs of warranty claims.

Changes in the carrying amount of accrued product warranty costs for each of the quarters ended September 30, 2020 and 2019 are as follows:

		September 30, 2020				September 30, 2019
Balance at beginning of period		$	10.0			$	9.4
Accrued current period warranty expense			2.7				2.7
Payments and adjustments			(2.9	)			(2.7	)
Balance at end of period		$	9.8			$	9.4

11. Debt

Outstanding debt obligations at September 30, 2020 and December 31, 2019 were as follows.

		September 30, 2020				December 31, 2019
Debt:
Term loan		$	1,100.0			$	1,190.0
Revolving Credit Facility			—				—
Notes			400.0				400.0
Mortgages and other			12.4				13.5
Finance leases			0.3				0.5
Total gross debt			1,512.7				1,604.0
Less: debt discount and deferred financing costs			(19.3	)			(22.2	)
Total debt, net of debt discount and deferred financing costs			1,493.4				1,581.8
Less: current portion of long-term debt			(16.5	)			(18.0	)
Total long-term debt, net of unaccreted discount		$	1,476.9			$	1,563.8

2018 Credit Agreement and Notes

On October 1, 2018 (the “A&S Closing Date”), upon the closing of the combination (the “Fortive Transaction”) of Altra with four operating companies from Fortive Corporation’s (“Fortive”) Automation & Specialty platform (the “A&S Business”), the Company assumed $400 million aggregate principal amount of 6.125% senior notes due 2026 (the “Notes”). The Notes will mature on October 1, 2026. Interest on the Notes accrues from October 1, 2018, and the first interest payment date on the Notes was on April 1, 2019. The Notes may be redeemed at the option of the issuer on or after October 1, 2023. The Notes are guaranteed on a senior unsecured basis by the Company and certain of its domestic subsidiaries.

14

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

On the A&S Closing Date, the Company entered into a new Credit Agreement (the “Altra Credit Agreement”). The Altra Credit Agreement provides for a seven-year senior secured term loan in an aggregate principal amount of $1,340.0 million (the “Altra Term Loan Facility”) and a five-year senior secured revolving credit facility in an aggregate committed principal amount of $300.0 million (the “Altra Revolving Credit Facility” and together with the Altra Term Loan Facility, the “Altra Credit Facilities”). The proceeds of the Altra Term Loan Facility were used to (i) consummate Fortive’s transfer of certain non-U.S assets, liabilities and entities constituting a portion of the A&S Business to certain subsidiaries of Altra, and the Altra subsidiaries’ assumption of substantially all of the liabilities associated with the transferred assets (the “Direct Sales”), (ii) repay in full and extinguish all outstanding indebtedness for borrowed money under the 2015 Credit Agreement (as defined herein) and (iii) pay certain fees, costs, and expenses in connection with the consummation of the Fortive Transaction. The proceeds of the Altra Revolving Credit Facility will be used for working capital and general corporate purposes.

The Altra Credit Facilities are guaranteed on a senior secured basis by the Company and certain of its domestic subsidiaries, subject to certain customary exceptions.

Borrowings under the Altra Term Loan Facility will bear interest at a per annum rate equal to a “Eurocurrency Rate” plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a “Base Rate” plus 1.00%, in the case of Base Rate borrowings. Borrowings under the Altra Revolving Credit Facility will initially bear interest at a per annum rate equal to a Eurocurrency Rate plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a Base Rate plus 1.00%, in the case of Base Rate borrowings, and thereafter will bear interest at a per annum rate equal to a Eurocurrency Rate or Base Rate, as applicable, plus an interest rate spread determined by reference to a pricing grid based on the Company’s senior secured net leverage ratio. In addition, the Company will be required to pay fees that will fluctuate between 0.250% per annum to 0.375% per annum on the unused amount of the Altra Revolving Credit Facility, based upon the Company’s senior secured net leverage ratio. The interest rate on the Term Loan Facility was 2.146% at September 30, 2020.

The Altra Credit Agreement contains usual and customary representations and warranties, and usual and customary affirmative and negative covenants, including limitations on liens, investments, restricted payments, additional indebtedness and asset sales and mergers. In addition, the Altra Credit Agreement requires that Altra maintain a specified maximum senior secured leverage ratio and a specified minimum interest coverage ratio. The obligations of the borrowers of the Altra Credit Facilities under the Altra Credit Agreement may be accelerated upon customary events of default, including non-payment of principal, interest, fees and other amounts, inaccuracy of representation and warranties, violation of covenants, cross default and cross acceleration, voluntary and involuntary bankruptcy or insolvency proceedings, inability to pay debts as they become due, material judgments, ERISA events, actual or asserted invalidity of security documents or guarantees and change in control.

The Company incurred $29.9 million in issuance costs, which are amortized over the term of the debt as an adjustment to the effective interest rate on the outstanding borrowings.

The Company provided notice to the administrative agent of the Altra Credit Agreement on March 9, 2020 and March 16, 2020 to draw down $50 million and $50 million, respectively, under the Altra Revolving Credit Facility. At that time, the Company had increased its borrowings under the Altra Revolving Credit Facility as a precautionary action in order to increase its cash position and enhance its financial flexibility during this period of uncertainty in the global markets resulting from COVID-19. On April 14, 2020, the Company provided notice to the administrative agent of the Altra Credit Agreement to repay $50 million outstanding under the Altra Revolving Credit Facility. On April 27, 2020 and May 27, 2020 the Company provided notice to the administrative agent to repay $15 million and $35 million, respectively, which were outstanding under the Altra Revolving Credit Facility. As of the period ended September 30, 2020, all outstanding borrowings under the Altra Revolving Credit Facility have been repaid.

As of September 30, 2020, the Company had $1,100.0 million outstanding on the Altra Credit Agreement. As of September 30, 2020 and December 31, 2019, the Company had $5.2 million and $4.4 million in letters of credit outstanding, respectively. The Company had $294.8 million available to borrow under the Altra Credit Facilities at September 30, 2020.

Mortgages and Other Agreements

The Company’s subsidiaries in Europe have entered into certain long-term fixed rate term loans that are generally secured by local property, plant and equipment. The debt has interest rates that range from 1.79% to 2.5%, with various quarterly and monthly installments through 2028.

15

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

Financing Leases

The Company leases certain equipment under finance lease arrangements, whose obligations are included in both short-term and long-term debt. Finance lease obligations amounted to approximately $0.3 million and $0.5 million at September 30, 2020 and December 31, 2019, respectively. Finance lease right of use assets are included in property, plant and equipment with the related amortization recorded as depreciation expense.

12. Stockholders’ Equity

Common Stock

Effective October 1, 2018, the Company amended its Articles of Incorporation to increase the number of authorized shares of Altra common stock from 90.0 million shares to 120.0 million shares. As of September 30, 2020 and December 31, 2019, there were 64,665,347 and 64,222,603 shares of common stock issued and outstanding, respectively.

Preferred Stock

On December 20, 2006, the Company amended and restated its certificate of incorporation authorizing 10.0 million shares of undesignated Preferred Stock (“Preferred Stock”). The Preferred Stock may be issued from time to time in one or more classes or series, the shares of each class or series to have such designations and powers, preferences, rights, qualifications, limitations and restrictions as determined by the Company’s Board of Directors. There was no Preferred Stock issued or outstanding at September 30, 2020 or December 31, 2019.

Restricted Common Stock

The 2014 Omnibus Incentive Plan (the “2014 Plan”) was approved by the Company’s stockholders at the Company’s 2014 Annual Meeting of Stockholders. The 2014 Plan provides for various forms of stock-based compensation to our directors, executive personnel and other key employees and consultants. Under the 2014 Plan, the remaining total number of shares of common stock available for delivery pursuant to the grant of awards (“Awards”) was 4.4 million as of September 30, 2020.

The restricted shares and restricted stock units issued pursuant to the 2014 Plan generally vest ratably over a period ranging from immediately to five years from the date of grant, provided, that the vesting of the restricted shares or restricted stock units may accelerate upon the occurrence of certain events. Common stock awarded under the 2014 Plan is generally subject to restrictions on transfer, repurchase rights, and other limitations and rights as set forth in the applicable award agreements. The fair value of the shares repurchased are measured based on the share price on the date of grant.

The 2014 Plan permits the Company to grant, among other things, restricted stock, restricted stock units, stock options and performance share awards to key employees. Certain awards include vesting based upon achievement of specified performance criteria. Compensation expense recorded (in selling, general and administrative expense) during the quarters ended September 30, 2020 and 2019 was $3.2 million and $3.2 million, respectively. Compensation expense recorded (in selling, general and administrative expense) during the year to date period ended September 30, 2020 and 2019 was $10.3 million and $10.1 million, respectively. The Company recognizes stock-based compensation expense on a straight-line basis for the shares vesting ratably under the plan and uses the graded-vesting method of recognizing stock-based compensation expense for the performance share awards based on the probability of the specific performance metrics being achieved over the requisite service period.

The following tables set forth the activity of the Company’s restricted stock grants and stock options to date (amounts in thousands):

		Shares				Weighted- average fair value
Shares unvested January 1, 2020			786.3			$	35.69
Shares granted			329.2				35.55
Shares for which restrictions lapsed			(331.1	)			37.26
Shares unvested September 30, 2020			784.4			$	34.62

16

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

		Shares				Weighted- average fair value
Options unvested January 1, 2020			271.7			$	30.65
Options granted			214.5				34.78
Options exercised			(2.0	)			30.65
Options forfeited			(16.4	)			32.81
Options outstanding September 30, 2020			467.8			$	32.47
Quantity ending exercisable balance			168.7			$	31.78

Total remaining unrecognized compensation cost is approximately $21.7 million as of September 30, 2020, and will be recognized over a weighted average remaining period of three years. The intrinsic value of these awards, as of September 30, 2020, was $31.1 million. Grant date fair value is based on the quoted price of the stock on the date of grant.

13. Restructuring Costs

From time to time, the Company has initiated various restructuring programs and incurred severance and other restructuring costs.

During 2017, the Company commenced a restructuring plan (“2017 Altra Plan”) as a result of the Company’s purchase of Stromag and to rationalize its global renewable energy business. The actions taken pursuant to the 2017 Altra Plan included reducing headcount, facility consolidations and the elimination of certain costs. The expenses for the year to date period ended September 30, 2020 were approximately $0.5 million and were composed of severance and other restructuring costs. The Company does not expect to incur any additional material costs as a result of the 2017 Altra Plan.

During 2019, the Company commenced a restructuring plan (“2019 Altra Plan”) to drive efficiencies, reduce the number of facilities and optimize its operating margin. The Company expects to incur approximately $5 - $10 million in restructuring expenses under the 2019 Altra Plan over the next three years, primarily related to headcount reductions and plant consolidations. The expenses for the quarter and year to date period ended September 30, 2020 were $2.4 million and $5.0 million, respectively, and were composed of severance and consolidation costs.

The following is a reconciliation of the accrued restructuring costs between January 1, 2020 and September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Balance at January 1, 2020		$	1.5			$	2.6			$	4.1
Restructuring expense incurred			0.2				1.4				1.6
Cash payments			(0.4	)			(1.4	)			(1.8	)
Balance at March 31, 2020			1.3				2.6				3.9
Restructuring expense incurred			0.3				1.2				1.5
Cash payments			(0.6	)			(1.1	)			(1.7	)
Balance at June 30, 2020			1.0				2.7				3.7
Restructuring expense incurred			—				2.4				2.4
Cash payments			(0.2	)			(2.9	)			(3.1	)
Balance at September 30, 2020		$	0.8			$	2.2			$	3.0

17

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

The following is a reconcilation of the accrued restructuring costs between January 1, 2019 and September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Balance at January 1, 2019		$	2.0			$	—			$	2.0
Restructuring expense incurred			1.0				1.3				2.3
Cash payments			(1.5	)			(0.5	)			(2.0	)
Balance at March 31, 2019			1.5				0.8				2.3
Restructuring expense incurred			1.8				1.4				3.2
Cash payments			(2.0	)			(0.7	)			(2.7	)
Balance at June 30, 2019			1.3				1.5				2.8
Restructuring expense incurred			2.3				3.9				6.2
Cash payments			(1.3	)			(1.7	)			(3.0	)
Balance at September 30, 2019		$	2.3			$	3.7			$	6.0

The following is a reconciliation of restructuring expense by segment for the quarter to date ended September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	—			$	2.0			$	2.0
Automation & Specialty			—				0.4				0.4
Total restructuring expense		$	—			$	2.4			$	2.4

The following is a reconciliation of restructuring expense by segment for the quarter to date ended September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	2.3			$	0.6			$	2.9
Automation & Specialty			—				3.3				3.3
Total restructuring expense		$	2.3			$	3.9			$	6.2

The following is a reconciliation of restructuring expense by segment for the year to date period ended September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	0.5			$	2.6			$	3.1
Automation & Specialty			—				2.4				2.4
Total restructuring expense		$	0.5			$	5.0			$	5.5

The following is a reconciliation of restructuring expense by segment for the year to date period ended September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	5.1			$	0.7			$	5.8
Automation & Specialty			—				5.9				5.9
Total restructuring expense		$	5.1			$	6.6			$	11.7

The total accrued restructuring reserve as of September 30, 2020, and as of September 30, 2019 relate primarily to severance and consolidation costs under the 2017 Altra Plan and the 2019 Altra Plan and are recorded in accruals and other liabilities on the accompanying unaudited condensed consolidated balance sheet.

18

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

14. Segments, Concentrations and Geographic Information

Segments

The internal reporting structure used by our Chief Operating Decision Maker (“CODM”) to assess performance and allocate resources determines the basis for our reportable operating segments. Our CODM is our Chief Executive Officer, and he evaluates operations and allocates resources based on a measure of income from operations. Our operations are organized in two reporting segments that are aligned with key product types and end markets served, Power Transmission Technologies (“PTT”) and Automation & Specialty (“A&S”):

•

Power Transmission Technologies - PTT. This segment includes the following key product offerings:

o

Couplings, Clutches & Brakes. Couplings are the interface between two shafts, which enable power to be transmitted from one shaft to the other. Clutches in this segment are devices that use mechanical, hydraulic, pneumatic, or friction type connections to facilitate engaging or disengaging two rotating members. Brakes are combinations of interacting parts that work to slow or stop machinery. Products in this segment are generally used in heavy industrial applications and energy markets.

o

Electromagnetic Clutches & Brakes. Products in this segment include brakes and clutches that are used to electronically slow, stop, engage or disengage equipment utilizing electromagnetic friction type connections. Products in this segment are used in industrial and commercial markets including agricultural machinery, material handling, motion control, and turf & garden.

o

Gearing. Gears are utilized to reduce the speed and increase the torque of an electric motor or engine to the level required to drive a particular piece of equipment. Gears produced by the Company are primarily utilized in industrial applications.

•

Automation & Specialty – A&S. This segment includes the following key brands:

o

Kollmorgen: Provides rotary precision motion solutions, including servo motors, stepper motors, high performance electronic drives and motion controllers and related software, and precision linear actuators. These products are used in advanced material handling, aerospace and defense, factory automation, medical, packaging, printing, semiconductor, robotic and other applications.

o

Portescap: Provides high-efficiency miniature motors and motion control products, including brush and brushless DC motors, can stack motors and disc magnet motors. These products are used in medical, industrial power tool and general industrial equipment applications.

o

Thomson: Provides systems that enable and support the transition of rotary motion to linear motion. Products include linear bearings, guides, glides, lead and ball screws, industrial linear actuators, clutch brakes, precision gears, resolvers and inductors. These products are used in factory automation, medical, mobile off-highway, material handling, food processing and other niche applications.

o

Jacobs Vehicle Systems (JVS): Provides heavy-duty diesel engine brake systems and valve actuation mechanisms for the commercial vehicle market, including compression release, bleeder and exhaust brakes, including the “Jake Brake” engine braking system. These products are primarily used in heavy duty Class 8 truck applications.

19

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

Segment financial information and a reconciliation of segment results to unaudited condensed consolidated results are as follows:

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net Sales:
Power Transmission Technologies		$	197.7			$	218.7			$	610.7			$	688.6
Automation & Specialty			240.8				224.8				665.2				707.2
Inter-segment eliminations			(0.7	)			(0.6	)			(3.1	)			(3.6	)
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2
Income/(loss) from operations:
Segment earnings:
Power Transmission Technologies		$	23.5			$	26.3			$	73.0			$	87.1
Automation & Specialty			44.6				29.7				(48.0	)			102.1
Corporate expenses (1)			(0.3	)			(1.3	)			—				(5.5	)
Restructuring costs			(2.4	)			(6.2	)			(5.5	)			(11.7	)
Income/(loss) from operations		$	65.4			$	48.5			$	19.5			$	172.0
Other non-operating expense:
Net interest expense			18.0				18.2				54.2				56.6
Other non-operating expense, net			(0.3	)			(0.4	)			0.8				1.1
Total non-operating expense		$	17.7			$	17.8			$	55.0			$	57.7
Income/(loss) before income taxes			47.7				30.7				(35.5	)			114.3
Provision for income taxes			9.4				5.0				21.2				24.4
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9

(1)

Certain expenses are maintained at the corporate level and are not allocated to the segments. These include various administrative expenses related to the Company’s corporate headquarters, certain U.S. healthcare costs and credits, depreciation on capitalized software costs, non-capitalizable software implementation costs and acquisition related expenses.

Selected information by segment (continued)

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Depreciation and amortization:
Power Transmission Technologies		$	8.2			$	8.3			$	24.6			$	25.0
Automation & Specialty			23.3				23.2				69.4				69.4
Corporate			0.9				0.6				2.5				2.0
Total depreciation and amortization		$	32.4			$	32.1			$	96.5			$	96.4

										September 30, 2020				September 30, 2019
Total assets:
Power Transmission Technologies										$	1,054.2			$	1,064.7
Automation & Specialty											2,956.0				3,085.6
Corporate(2)											135.7				143.4
Total assets										$	4,145.9			$	4,293.7

(2)	Corporate assets are primarily cash and cash equivalents, tax related asset accounts, certain capitalized software costs, and property, plant and equipment.

20

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

Net sales to third parties by geographic region are as follows:

		Net Sales
		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
North America (primarily U.S.)		$	230.2			$	251.5			$	681.3			$	794.3
Europe excluding Germany			68.8				72.1				214.9				233.8
Germany			44.1				54.9				140.7				173.9
China			56.5				35.1				150.1				105.8
Asia and other (excluding China)			38.2				29.3				85.8				84.4
Total		$	437.8			$	442.9			$	1,272.8			$	1,392.2

Net sales to third parties are attributed to the geographic regions based on the country in which the shipment originates. Amounts attributed to the geographic regions for property, plant and equipment are based on the location of the entity, which holds such assets.

15. Derivative Financial Instruments

The Company may manage changes in market conditions related to interest on debt obligations and foreign currency exposures by entering into derivative instruments, including interest rate and foreign currency swap agreements. All derivative instruments are recognized as either assets or liabilities on the balance sheet at fair value at the end of each period. The Company determines the fair value of financial instruments using quoted market prices whenever available. When quoted market prices are not available for various types of financial instruments (such as forwards, options and swaps), the Company uses standard models with market-based inputs, which take into account the present value of estimated future cash flows and the ability of Altra or the financial counterparty to perform. For interest rate swaps, the significant inputs to these models are interest rate curves for discounting future cash flows that are adjusted for credit risk. For forward foreign currency contracts, the significant inputs are interest rate curves for discounting future cash flows, and exchange rate curves of the foreign currency for translating future cash flows. For designated hedging relationships, the Company formally documents the hedging relationship consistent with the requirements of ASC 815, Derivatives.

Cross Currency Interest Rate Swaps

In December 2018, the Company entered into cross-currency swap agreements to hedge its net investment in Euro-denominated assets against future volatility in the exchange rate between the U.S. dollar and the Euro. By doing so, the Company synthetically converted a portion of its U.S. dollar-based long-term debt into Euro-denominated long-term debt. The agreements originally had a five-year maturity at notional amounts declining from $600.0 million to $360.0 million over the contract period. The terms of the swap agreements provided for the Company to receive net interest payments at a fixed rate of 4.8255% and pay Euros at rates ranging from 2.19% to 2.315%. At inception, the cross-currency swaps were designated as net investment hedges.

For net investment hedges, changes in the fair value of the effective portion of the derivatives’ gains or losses are reported as foreign currency translation gains or losses in accumulated other comprehensive income (loss) (“AOCIL”). The gains or losses on the net investment hedges reported in AOCIL are reclassified to earnings in the period in which earnings are affected by the underlying item, such as a disposal or substantial liquidations of the entities being hedged.

21

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

During the first quarter of 2020, the global economy declined substantially due to the impact of COVID-19. This decline resulted in a significant increase in the value of the U.S. dollar. The appreciation of the U.S. dollar resulted in the Company’s cross currency interest rate swaps being substantially in-the-money. Given the increased cash value of the hedges and the Company’s overall desire to strengthen its cash position, the Company terminated the cross-currency interest rate swaps during the first quarter of 2020. The Company received the cash value of the cross-currency interest rate swaps of approximately $56.2 million upon termination. In addition, the Company paid the interest owed and received the interest due, resulting in the recognition of approximately $3.3 million in net interest income, and paid termination fees of approximately $0.9 million. Through the date of the termination of the cross-currency interest rate swaps, the Company recorded a gain in AOCIL of approximately $31.3 million, net of $9.9 million of tax, compared to $19.8 million, net of $3.6 million of tax, during the year to date period ended September 30, 2020, and year to date period ended December 31, 2019, respectively.


		September 30, 2020				December 31, 2019
Description (in millions)		Gain/(Loss) Recognized in AOCI
Cross currency swap agreements, net of tax		$	31.3			$	19.8

Interest Rate Swaps

In January 2017, the Company entered into an interest rate swap agreement to fix the variable interest rate payable on a portion of its outstanding borrowings. This interest rate swap matured on January 31, 2020.

In December 2018, the Company entered into an interest rate swap agreement to manage the cash flow risk caused by interest rate changes on the forecasted interest payments expected to occur related to a portion of its outstanding borrowings under the Altra Credit Agreement for a notional value of $600 million at 4.8255%.

The interest rate swap agreement was designed to manage exposure to interest rates on the Company’s variable rate indebtedness and was recognized on the balance sheet at fair value. The Company designated this interest rate swap agreement as a cash flow hedge and changes in the fair value of the swap were recognized in other comprehensive income until the hedged items were recognized in earnings.

During the second quarter of 2020, the Company terminated the interest rate swap agreement. The Company paid the cash value of the interest rate swaps of approximately $34.7 million upon termination. In addition, the Company paid the interest owed and received the interest due, resulting in the recognition of approximately $0.1 million in net interest expense, and paid termination fees of approximately $0.1 million. Through the date of the termination of the interest rate swap, the Company recorded a loss in AOCIL of approximately $11.9 million, net of $3.8 million of tax benefit, compared to $9.8 million, net of $1.7 million of tax benefit, during the year to date period ended September 30, 2020, and year to date period ended December 31, 2019, respectively. The loss on the interest rate swap reported in AOCIL will be reclassified to earnings in future periods when the hedged transaction affects earnings or if it is determined that it is probable that the hedged transaction will not occur. The Company reclassified approximately $3.4 million and $0.9 million of AOCIL into interest expense for the quarters ended September 30, 2020 and September 30, 2019, respectively. The Company reclassified $8.2 million and $1.9 million of AOCIL into interest expense for the year to date periods ended September 30, 2020 and September 30, 2019, respectively. Approximately $3.4 million and $5.6 million of the AOCIL reclassified to interest expense for the quarter and year to date period ended September 30, 2020, respectively, represents non-cash amortization due to the termination of the interest rate swap.

22

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

The following table summarizes the location and fair value, using Level 2 inputs (see Note 6 for a description of the fair value levels), of the Company's derivatives designated and not designated as hedging instruments in the unaudited condensed consolidated balance sheets (in millions).


		Balance Sheet Location		September 30, 2020				December 31, 2019
Designated as hedging instruments:
Cross currency swap agreements		Other long-term (assets)		$	—			$	(15.0	)
Interest rate swap agreement		Other long-term (assets)			—				(0.0	)
Interest rate swap agreement		Other long-term liabilities			—				19.0
				$	—			$	4.0

16. Commitments and Contingencies

General Litigation

The Company is involved in various pending legal proceedings arising out of the ordinary course of business. These proceedings primarily involve commercial claims, product liability claims, personal injury claims, and workers’ compensation claims. With respect to these proceedings, management believes that the Company will prevail, has adequate insurance coverage or has established appropriate reserves to cover potential liabilities. Any costs that management estimates may be paid related to these proceedings or claims are accrued when the liability is considered probable and the amount can be reasonably estimated. There can be no assurance, however, as to the ultimate outcome of any of these matters, and if all or substantially all of these legal proceedings were to be determined adversely to the Company, there could be a material adverse effect on the results of operations, cash flows, or financial condition of the Company. We have established loss provisions for matters in which losses are probable and can be reasonably estimated. For matters where a reserve has not been established and for which we believe a loss is reasonably possible, as well as for matters where a reserve has been recorded but for which an exposure to loss in excess of the amount accrued is reasonably possible, we believe that such losses, individually and in the aggregate, will not have a material effect on our unaudited condensed consolidated financial statements.

Our estimates regarding potential losses and materiality are based on our judgment and assessment of the claims utilizing currently available information. Although we will continue to reassess our reserves and estimates based on future developments, our objective assessment of the legal merits of such claims may not always be predictive of the outcome and actual results may vary from our current estimates. We will continue to consider the applicable guidance in ASC 450-20, based on the facts known at the time of our future filings, as it relates to legal contingencies, and will adjust our disclosures as may be required under the guidance.

There were no material amounts accrued in the accompanying unaudited condensed consolidated balance sheets for potential litigation as of September 30, 2020 or December 31, 2019.

The Company also risks exposure to product liability claims in connection with products it has sold and those sold by businesses that the Company acquired. Although in some cases third parties have retained responsibility for product liability claims relating to products manufactured or sold prior to the acquisition of the relevant business and in other cases the persons from whom the Company has acquired a business may be required to indemnify the Company for certain product liability claims subject to certain caps or limitations on indemnification, the Company cannot assure that those third parties will in fact satisfy their obligations with respect to liabilities retained by them or their indemnification obligations. If those third parties become unable to or otherwise do not comply with their respective obligations including indemnity obligations, or if certain product liability claims for which the Company is obligated were not retained by third parties or are not subject to these indemnities, the Company could become subject to significant liabilities or other adverse consequences. Moreover, even in cases where third parties retain responsibility for product liability claims or are required to indemnify the Company, significant claims arising from products that have been acquired could have a material adverse effect on the Company’s ability to realize the benefits from an acquisition, could result in the reduction of the value of goodwill that the Company recorded in connection with an acquisition, or could otherwise have a material adverse effect on the Company’s business, financial condition, or operations.

23

ALTRA INDUSTRIAL MOTION CORP.

Notes to Unaudited Condensed Consolidated Interim Financial Statements

Amounts in millions, unless otherwise noted

Environmental

There is contamination at some of the Company’s current facilities, primarily related to historical operations at those sites, for which the Company could be liable for the investigation and remediation under certain environmental laws. The potential for contamination also exists at other of the Company’s current or former sites, based on historical uses of those sites. The Company currently is not undertaking any material remediation or investigations and the costs or liability in connection with potential contamination conditions at these facilities cannot be predicted at this time because the potential existence of contamination has not been investigated or not enough is known about the environmental conditions or likely remedial requirements. Currently, other parties with contractual liability are addressing or have plans or obligations to address those contamination conditions that may pose a material risk to human health, safety or the environment. In addition, while the Company attempts to evaluate the risk of liability associated with these facilities at the time the Company acquired them, there may be environmental conditions currently unknown to the Company relating to prior, existing or future sites or operations or those of predecessor companies whose liabilities the Company may have assumed or acquired which could have a material adverse effect on the Company’s business.

The Company is being indemnified, or expects to be indemnified, by third parties subject to certain caps or limitations on the indemnification, for certain environmental costs and liabilities associated with certain owned or operated sites. Accordingly, based on the indemnification and the experience with similar sites of the environmental consultants who the Company has hired, the Company does not expect such costs and liabilities to have a material adverse effect on its business, operations or earnings. The Company cannot assure you, however, that those third parties will in fact satisfy their indemnification obligations. If those third parties become unable to, or otherwise do not, comply with their respective indemnity obligations, or if certain contamination or other liability for which the Company is obligated is not subject to these indemnities, the Company could become subject to significant liabilities.

From time to time, the Company is notified that it is a potentially responsible party and may have liability in connection with off-site disposal facilities. To date, the Company has generally resolved matters involving off-site disposal facilities for a nominal sum but there can be no assurance that the Company will be able to resolve pending or future matters in a similar fashion.

17. Subsequent Events

On October 21, 2020 the Company declared a dividend of $0.06 per share for the quarter ended December 31, 2020 , payable on January 5, 2021 to stockholders of record as of December 18, 2020.

24

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which reflect the Company’s current estimates, expectations and projections about the Company’s future results, performance, prospects and opportunities. Forward-looking statements include, among other things, the information concerning the Company’s possible future results of operations including revenue, costs of goods sold, gross margin, future profitability, future economic improvement, business and growth strategies, financing plans, expected leverage levels, the Company’s competitive position and the effects of competition, the projected growth of the industries in which we operate, and the Company’s ability to consummate strategic acquisitions and other transactions. In addition, all statements regarding the anticipated effects of the novel coronavirus, or COVID-19, pandemic and the responses thereto, including the pandemic’s impact on general economic and market conditions, as well as on our business, customers, end markets, results of operations and financial condition and anticipated actions to be taken by management to sustain the Company during the economic uncertainty caused by the pandemic and related governmental and business actions, as well as other statements that are not strictly historic in nature are forward looking. Forward-looking statements include statements that are not historical facts and can be identified by forward-looking words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “plan,”” may,” “project,” “should,” “will,” “would,” and similar expressions or variations. These forward-looking statements are based upon information currently available to the Company and are subject to a number of risks, uncertainties, and other factors that could cause the Company’s actual results, performance, prospects, or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements.

Important factors that could cause the Company’s actual results to differ materially from the results referred to in the forward-looking statements the Company makes in this report include:

•

the scope and duration of the COVID-19 global pandemic and its impact on global economic systems, our employees, sites, operations, customers, and supply chain;

•

the effects of intense competition in the markets in which we operate;

•

the cyclical nature of the markets in which we operate;

•

the loss of independent distributors on which we rely;

•

changes in market conditions in which we operate that would influence the value of the Company’s stock;

•

the Company’s ability to achieve its business plans, including with respect to an uncertain economic environment;

•

the risks associated with international operations, including currency risks;

•

the risks associated with and potential impacts of new trade policies, legislations, treaties, and tariffs both in and outside of the United States;

•

the Company’s ability to retain existing customers and our ability to attract new customers for growth of our business;

•

the effects of the loss or bankruptcy of or default by any significant customer, suppliers, or other entity relevant to the Company’s operations;

•

political and economic conditions globally, nationally, regionally, and in the markets in which we operate;

•

natural disasters, war, civil unrest, terrorism, fire, floods, tornadoes, earthquakes, hurricanes, pandemics, including, but not limited to, the COVID-19 pandemic, or other matters beyond the Company’s control;

•

the Company’s risk of loss not covered by insurance;

•

the accuracy of estimated forecasts of original equipment manufacturer (“OEM”) customers and the impact of the current global and European economic environment on our customers;

•

the risks associated with certain minimum purchase agreements we have with suppliers;

•

disruption of our supply chain;

•

fluctuations in the costs of raw materials used in our products;

•

the outcome of litigation to which the Company is a party from time to time, including product liability claims;

•

work stoppages and other labor issues;

25

•

changes in employment, environmental, tax and other laws, including enactment of the 2017 Tax Act, and changes in the enforcement of laws;

•

the Company’s ability to attract and retain key executives and other personnel;

•

the Company’s ability to successfully pursue the Company’s development activities and successfully integrate new operations and systems, including the realization of revenues, economies of scale, cost savings, and productivity gains associated with such operations;

•

the Company’s ability to obtain or protect intellectual property rights and avoid infringing on the intellectual property rights of others;

•

the risks associated with the portion of the Company’s total assets comprised of goodwill and indefinite lived intangibles;

•

changes in market conditions that would result in the impairment of goodwill or other assets of the Company;

•

changes in accounting rules and standards, audits, compliance with the Sarbanes-Oxley Act, and regulatory investigations;

•

the effects of changes to critical accounting estimates;

•

changes in volatility of the Company’s stock price and the risk of litigation following a decline in the price of the Company’s stock;

•

failure of the Company’s operating equipment or information technology infrastructure, including cyber-attacks or other security breaches, and failure to comply with data privacy laws or regulations;

•

the Company’s ability to implement and maintain its Enterprise Resource Planning (ERP) system;

•

the Company’s access to capital, credit ratings, indebtedness, and ability to raise additional capital and operate under the terms of the Company’s debt obligations;

•

the risks associated with the Company’s debt;

•

the risks associated with the Company’s exposure to variable interest rates and foreign currency exchange rates;

•

the risks associated with interest rate swap contracts;

•

the risks associated with transitioning from LIBOR to a replacement alternative reference rate;

•

the risks associated with the Company’s being subject to tax laws and regulations in various jurisdictions;

•

the risks associated with the Company’s exposure to renewable energy markets;

•

the risks related to regulations regarding conflict minerals;

•

the risks associated with the volatility and disruption in the global financial markets;

•

the Company’s ability to successfully execute, manage and integrate key acquisitions and mergers, including Altra’s purchase of Stromag (the “Stromag Acquisition”), and the business combination (the “Fortive Transaction”) of the Company with four operating companies from Fortive Corporation’s (“Fortive”) Automation & Specialty platform (the “A&S Business”);

•

other risks associated with the Fortive Transaction, including:

o

lost sales and customers as a result of customers of Altra or the A&S Business deciding not do so business with us;

o

risks associated with managing a larger and more complex business;

o

integrating personnel of Altra and the A&S Business while maintaining focus on providing consistent, high-quality products and service to customers;

o

the loss of key employees;

o

unanticipated issues in integrating manufacturing, logistics, information, communications and other systems;

o

possible inconsistencies in standards, controls, procedures, policies and compensation structures;

o

the impact on our internal controls and compliance with the regulatory requirements under the Sarbanes-Oxley Act of 2002; and

o

potential unknown liabilities and unforeseen expenses associated with the Fortive Transaction;

26

•

the Company’s ability to achieve the efficiencies, savings and other benefits anticipated from our cost reduction, margin improvement, restructuring, plant consolidation and other business optimization initiatives;

•

the risk associated with the United Kingdom’s vote to leave the European Union; and

•

other factors, risks, and uncertainties referenced in the Company’s filings with the Securities and Exchange Commission (“SEC”), including the “Risk Factors” set forth in this document.

ALL FORWARD-LOOKING STATEMENTS SPEAK ONLY AS OF THE DATE OF THIS REPORT. EXCEPT AS REQUIRED BY LAW, WE UNDERTAKE NO OBLIGATION TO PUBLICLY UPDATE OR RELEASE ANY REVISIONS TO THESE FORWARD-LOOKING STATEMENTS TO REFLECT ANY EVENTS OR CIRCUMSTANCES AFTER THE DATE OF THIS REPORT OR TO REFLECT THE OCCURRENCE OF UNANTICIPATED EVENTS. ALL SUBSEQUENT WRITTEN AND ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO US OR ANY PERSON ACTING ON THE COMPANY’S BEHALF ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE CAUTIONARY STATEMENTS CONTAINED OR REFERRED TO IN THIS SECTION AND IN OUR RISK FACTORS SET FORTH (1) IN THE SECTION TITLED “RISK FACTORS,” SET FORTH IN PART II, ITEM 1A OF THIS QUARTERLY REPORT ON FORM 10-Q; (2) IN PART I, ITEM 1A OF THE COMPANY’S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2019, FILED WITH THE SEC ON FEBRUARY 27, 2020; AND (3) IN THE COMPANY’S OTHER SEC FILINGS.

The following discussion of the financial condition and results of operations of Altra Industrial Motion Corp. and its subsidiaries should be read together with (1) the unaudited condensed consolidated financial statements of Altra Industrial Motion Corp. and its subsidiaries and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q and (2) the audited consolidated financial statements of Altra Industrial Motion Corp. and its subsidiaries and the related notes and management’s discussion and analysis of financial conditions and results of operations included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. The following discussion includes forward-looking statements. For a discussion of important factors that could cause actual results to differ materially from the results referred to in the forward-looking statements, see “Forward-Looking Statements” and “Risk Factors” in this Quarterly Report on Form 10-Q and “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Unless the context requires otherwise, the terms “Altra,” “Altra Industrial Motion Corp.,” “the Company,” “we,” “us,” and “our” refer to Altra Industrial Motion Corp. and its subsidiaries.

General

We are a leading global designer, producer and marketer of a wide range of electromechanical power transmission motion control products. Our technologies are used in various motion related applications and across a wide variety of high-volume manufacturing and non-manufacturing processes in which reliability and precision are critical to avoid costly down time and enhance the overall efficiency of operations.

We market our products under well recognized and established brands, which have been in existence for an average of over 85 years. We serve a diversified group of customers comprised of over 1,000 direct original equipment manufacturers (“OEMs”) including GE, Honeywell and Siemens, and also benefit from established, long-term relationships with leading industrial distributors, including Applied Industrial Technologies, Grainger, Kaman Corporation and Motion Industries. Many of our customers operate globally across a large number of industries, ranging from transportation, turf and agriculture, energy and mining to factory automation, medical and robotics. Our relationships with these customers often span multiple decades, which we believe reflects the high level of performance, quality and service we deliver, supplemented by the breadth of our offering, vast geographic footprint and our ability to rapidly develop custom solutions for complex customer requirements.

Our website is www.altramotion.com. By following the link “Investor Relations” and then “SEC Filings” on our website, you can access our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which we make available free of charge, as soon as reasonably practicable after such forms are filed with or furnished to the SEC. We are not including the information contained on or available through our website as a part of, or incorporating such information by reference into, this Quarterly Report on Form 10-Q.

27

Business Outlook

Our future financial performance depends, in large part, on conditions in the markets that we serve and on conditions in the U.S., European, and global economies in general. During the quarter ended September 30, 2020, we experienced greater than expected demand strength in certain of our end markets including the Class 8 truck market in China, the medical market, and the renewable energy market. Moreover, our aggressive cost-reduction actions led to strong profitability and cash flow generation, as well as effective debt reduction.

The COVID-19 pandemic continues to affect the global economy and business environment. In the third quarter, the Company’s Pandemic Response Team continued to identify and assess risks and develop countermeasures following guidance from national, state and local governmental and health authorities. In addition, the Company’s Business Continuity Task Force continued to work to ensure continuity of supply for its customers. During the third quarter, Altra experienced minimal supply chain disruption and all material manufacturing facilities continued to be operational.

The COVID-19 pandemic and its effects on the economic environment remain extremely fluid and it is difficult to predict with certainty what unforeseen circumstances may develop as we progress through the remainder of the year. As a result, we will continue to proceed cautiously by managing our cost structure and cash flows and prioritizing debt reduction. In addition, we are implementing strategic plans to best position Altra to adapt to these changing conditions and to continue to serve our customers and community.

Critical Accounting Policies

The preparation of our unaudited condensed consolidated financial statements and related disclosures in conformity with generally accepted accounting principles in the United States (“GAAP”) requires management to make judgments, assumptions and estimates that affect our reported amounts of assets, revenues and expenses, as well as related disclosures of contingent assets and liabilities. We base our estimates on past experiences and other assumptions we believe to be appropriate, and we evaluate these estimates on an on-going basis. See the discussion of critical accounting policies in our Annual Report on Form 10-K for the year ended December 31, 2019. Except as otherwise noted below, there have been no changes in the identification or application of the Company’s critical accounting policies during the quarter ended September 30, 2020.

Impairment of Goodwill and Indefinite-Lived Intangible Assets

The Company conducts an annual impairment review of goodwill and indefinite-lived intangible assets during the fourth quarter of each year, unless events occur which trigger the need for an interim impairment review. The 2019 annual goodwill impairment review indicated that the JVS reporting unit’s fair value exceeded its carrying value by less than 10%. All other reporting units had fair values that exceeded their carrying value by 10% or more.

During the first quarter of 2020 the Company considered the economic impact of the COVID-19 pandemic to be a triggering event for the JVS business unit and, as a result, the Company performed an interim impairment review. As a result of both the COVID-19 related economic downturn and its impact on JVS’s anticipated financial results, the Company concluded that it was more likely than not that the JVS reporting unit’s carrying value exceeds its fair value and performed an interim impairment review for both JVS’s goodwill and tradename intangible asset. As a result, on March 31, 2020, the Company recorded non-cash impairment charges of $8.4 million and $139.1 million for goodwill and indefinite-lived intangible assets, respectively.

The Company estimated the fair value of the JVS reporting unit using both the discounted cash flow model and the market approach. The Company estimated the value of JVS’s indefinite-lived tradename intangible asset using a discounted cash flow model. The determination of the fair value using the discounted cash flow model requires management to make significant estimates and assumptions related to forecasts of future revenues, profit margins, and discount rates. The determination of the fair value using the market approach requires management to make significant assumptions related to earnings before interest, taxes, depreciation, and amortization (“EBITDA”) multiples. The Company estimates future cash flows based upon historical results and current market projections, discounted at a market comparable rate.

Key assumptions developed by management and used in the interim quantitative analysis included the following:

•

Near-term revenue declines in 2020;

•

Adjusted profit margins over the projection period, due to revenue adjustments and maintained investment in the business; and

28

•

Market-based discount rates.

•

Reduced EBITDA multiple, due to current market conditions.

During the third quarter of 2020, the Company again considered the economic impact of the COVID-19 pandemic on the reporting units and determined there was no triggering event. For all reporting units, the Company concluded that it was more likely than not that their fair value continued to exceed their carrying value as of September 30, 2020. However, depending on its duration and the severity of its economic impact, the COVID-19 pandemic may trigger additional interim impairment reviews in future periods.

Income Taxes

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law in the U.S. to provide certain relief as a result of the COVID-19 pandemic. In addition, governments around the world have enacted or implemented various forms of tax relief measures in response to the economic conditions in the wake of COVID-19. Altra has determined that neither the CARES Act nor changes to income tax laws or regulations in other jurisdictions had a significant impact on the Company’s unaudited condensed consolidated financial statements for the period ended September 30, 2020.

Trade Account Receivables

As a result of the adoption of ASU 2016-13, the Company has updated its significant accounting policy related to trade account receivables and allowances for credit losses from what was previously disclosed in our audited financial statements for the year ended December 31, 2019 as follows:

All trade account receivables are reported net of allowances for credit losses. The allowances for credit losses represent management’s best estimate of the credit losses expected from our trade account receivables over the life of the underlying assets. Assets with similar risk characteristics are pooled together for determination of their current expected credit losses. We regularly perform detailed reviews of our pooled assets to evaluate the collectability of receivables based on a combination of past, current, and future financial and qualitative factors that may affect customers’ ability to pay. In circumstances where we are aware of a specific customer’s inability to meet its financial obligations, a specific reserve is recorded against amounts due to reduce the recognized receivable to the amount reasonably expected to be collected.

Recent Accounting Standards

See Part 1, Notes to Unaudited Condensed Consolidated Interim Financial Statements, Note 3 – Recent Accounting Standards.

Results of Operations

(Amounts in millions, unless otherwise noted)

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2
Cost of sales			273.7				285.9				812.3				893.3
Gross profit			164.1				157.0				460.5				498.9
Gross profit percentage			37.5	%			35.4	%			36.2	%			35.8	%
Selling, general and administrative expenses			82.5				87.9				245.4				270.8
Impairment of Goodwill and Intangible Asset			—				—				147.5				—
Research and development expenses			13.8				14.4				42.6				44.4
Restructuring costs			2.4				6.2				5.5				11.7
Income from operations			65.4				48.5				19.5				172.0
Interest expense, net			18.0				18.2				54.2				56.6
Other non-operating expense/(income), net			(0.3	)			(0.4	)			0.8				1.1
Income/(loss) before income taxes			47.7				30.7				(35.5	)			114.3
Provision for income taxes			9.4				5.0				21.2				24.4
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9

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Quarter Ended September 30, 2020 compared with Quarter Ended September 30, 2019

(Amounts in millions, unless otherwise noted)

Amounts in millions, except percentage data		Quarter Ended
		September 30, 2020				September 30, 2019				Change				%
Net sales		$	437.8			$	442.9			$	(5.1	)			(1.2	)%

Net SalesThe decrease in net sales during the quarter ended September 30, 2020 is primarily due to the overall economic decline due to the effects of the COVID-19 pandemic, and a decline in sales in our oil and gas end market, as a result of the reduction in oil prices globally. Foreign exchange had a favorable impact on net sales of $5.4 million, primarily driven by the Euro. The decrease in sales was partially offset by strength in China, primarily in the heavy-duty truck and wind end markets. The decrease in sales was also partially offset by price which had a favorable impact of $4.7 million for the quarter ended September 30, 2020.

Amounts in millions, except percentage data		Quarter Ended
		September 30, 2020				September 30, 2019				Change				%
Gross profit		$	164.1			$	157.0			$	7.1				4.5	%
Gross profit as a percent of sales			37.5	%			35.4	%

Gross Profit Gross profit increased during the quarter ended September 30, 2020, primarily due to a recovery in the heavy duty class 8 truck and renewable energy end markets in China, and the favorable impact from price of $4.7 million. Changes in foreign exchange had a favorable impact on gross profit of $2.0 million, primarily driven by the Euro. These increases were partially offset by the economic impact of the COVID-19 pandemic including a decrease in sales levels, costs associated with temporary shutdowns of our manufacturing facilities and shutdowns of operations of our customers and suppliers. We have taken actions to reduce our expenses and maximize near-term profitability, and despite the increase in the third quarter, we continue to expect our 2020 gross profit as a percentage of sales to decrease when compared to 2019.

Amounts in millions, except percentage data		Quarter Ended
		September 30, 2020				September 30, 2019				Change				%
Selling, general and administrative expense (“SG&A”)		$	82.5			$	87.9			$	(5.4	)			(6.1	)%
SG&A as a percent of sales			18.8	%			19.8	%

Selling, general and administrative expenses The decrease in SG&A during the quarter ended September 30, 2020, when compared to the quarter ended September 30, 2019 was primarily due to cost reduction actions which began during the quarter ended March 31, 2020 and continued during the current quarter. Our cost reduction efforts were focused on compensation reductions, and the elimination of non-critical expenses, including travel, which decreased our overall SG&A costs. Although we do expect our SG&A costs to increase as certain temporary cost reductions terminate, due to ongoing uncertainty as a result of the COVID-19 pandemic, we are not able to anticipate whether any of these costs will increase in the remainder of 2020.

Amounts in millions, except percentage data		Quarter Ended
		September 30, 2020				September 30, 2019				Change				%
Research and development expenses (“R&D”)		$	13.8			$	14.4			$	(0.6	)			(4.2	)%

Research and development expense Research and development expenses decreased for the quarter ended September 30, 2020 when compared to the quarter ended September 30, 2019 primarily due to cost reduction actions which began during the quarter ended March 31, 2020. The decrease is partially offset by the unfavorable impact of foreign exchange of $0.3 million, primarily driven by the Euro. We expect R&D costs to be approximately 2.5% - 3.5% of sales in future periods.

Amounts in millions, except percentage data		Quarter Ended
		September 30, 2020				September 30, 2019				Change				%
Restructuring costs		$	2.4			$	6.2			$	(3.8	)			(61.3	)%

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Restructuring costs. During the quarter ended September 30, 2017, we commenced a restructuring plan (“2017 Altra Plan”) as a result of the Stromag Acquisition and to rationalize our global renewable energy business. The actions taken pursuant to the 2017 Altra Plan included reducing headcount, facility consolidations and the elimination of certain costs. The total 2017 Altra Plan savings are in line with our expectations. We do not expect to incur any additional material costs as a result of the 2017 Altra Plan.

During 2019, we commenced a restructuring plan (“2019 Altra Plan”) to drive efficiencies, reduce the number of facilities and optimize our operating margin. We expect to incur $5 - $10 million in restructuring expenses under the 2019 Plan over the next three years, primarily related to headcount reductions and plant consolidations. We achieved savings of $0.3 million during the quarter ended September 30, 2020 under the 2019 Altra Plan and estimate additional future savings during 2020 to be approximately $1.8 million. The cost savings for the quarter ended September 30, 2020 were recognized as reductions in SG&A and Cost of Sales of approximately $0.2 million and $0.1 million, respectively.

Amounts in millions, except percentage data		Quarter Ended
		September 30, 2020				September 30, 2019				Change				%
Interest expense, net		$	18.0			$	18.2			$	(0.2	)			(1.1	)%

Interest expenseInterest expense decreased for the quarter ended September 30, 2020 compared to the prior year period primarily due to the impact of debt paydowns of approximately $60.0 million, and lower average interest rates. This was partially offset by approximately $3.4 million of non-cash interest expense related to the termination of the interest rate swap.

Amounts in millions, except percentage data		Quarter Ended
		September 30, 2020				September 30, 2019				Change				%
Provision for income taxes		$	9.4			$	5.0			$	4.4				88.0	%
Provision for income taxes as a percent of income before income taxes			19.7	%			16.3	%

Provision for Income Taxes The provision for income tax as a percentage of income before income taxes increased for the quarter ended September 30, 2020 as compared to the quarter ended September 30, 2019. The increase in the 2020 provision for income tax as a percent of income before income taxes is due to the impact of $3.1 million of withholding tax paid as a result of dividends from two of our foreign subsidiaries. This was partially offset by a $1.8 million tax benefit as a result of changes in Global Intangible Low-Taxed Income (“GILTI”) tax expense recorded in prior periods due to updated legislation. We expect our provision for income taxes before discrete items to be approximately 21% to 23% for the full year 2020.

Year to Date Ended September 30, 2020 compared with Year to Date Ended September 30, 2019

(Amounts in millions, unless otherwise noted)

Amounts in millions, except percentage data		Year to Date Ended
		September 30, 2020				September 30, 2019				Change				%
Net sales		$	1,272.8			$	1,392.2			$	(119.4	)			(8.6	)%

Net SalesThe decrease in net sales during the year to date period ended September 30, 2020 is primarily due to a decline in sales in our oil and gas end market as a result of the decline in oil prices globally, and the overall economic decline due to the effects of the COVID-19 pandemic. Changes in foreign exchange had an unfavorable impact on net sales of $8.8 million, primarily driven by the Euro, Indian Rupee and Chinese Renminbi. This was partially offset by increased sales in China, primarily in the heavy duty truck and wind end markets, and price which had a favorable impact of $11.0 million for the year to date period ended September 30, 2020.

Amounts in millions, except percentage data		Year to Date Ended
		September 30, 2020				September 30, 2019				Change				%
Gross profit		$	460.5			$	498.9			$	(38.4	)			(7.7	)%
Gross profit as a percent of sales			36.2	%			35.8	%

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Gross Profit Gross profit as a percentage of net sales increased during the year to date period ended September 30, 2020, primarily due to cost reduction actions taken in response to the economic impact of the COVID-19 pandemic which began during the quarter ended March 31, 2020, and the recovery in the heavy duty class 8 truck and renewable energy end markets in China. In addition, price had a favorable impact of $11.1 million. The increases were partially offset by the economic impact of the COVID-19 pandemic including a decrease in sales levels, costs associated with temporary shutdowns of our manufacturing facilities and shutdowns of operations of our customers and suppliers. Changes in foreign exchange had an unfavorable impact on gross profit of $3.5 million, primarily driven by the Euro, Indian Rupee and Chinese Renminbi. We have taken actions to reduce our expenses and maximize near-term profitability; however, we continue to expect our 2020 gross profit as a percentage of sales to decrease when compared to 2019.

Amounts in millions, except percentage data		Year to Date Ended
		September 30, 2020				September 30, 2019				Change				%
Selling, general and administrative expense (“SG&A”)		$	245.4			$	270.8			$	(25.4	)			(9.4	)%
SG&A as a percent of sales			19.3	%			19.5	%

Selling, general and administrative expenses The decrease in SG&A during the year to date period ended September 30, 2020 was primarily due to cost reduction actions which began during the quarter ended March 31, 2020 and continued during the current period. Our cost reduction efforts were focused on compensation reductions, and the elimination of non-critical expenses, including travel, which decreased our SG&A costs. However, due to the decrease in sales, SG&A as a percent of sales increased despite our cost reductions. Although we do expect our SG&A costs to increase as certain temporary cost reductions terminate, due to the ongoing uncertainty due to the COVID-19 pandemic, we are not able to anticipate whether any of these costs will increase in the remainder of 2020.

Amounts in millions, except percentage data		Year to Date Ended
		September 30, 2020				September 30, 2019				Change				%
Research and development expenses (“R&D”)		$	42.6			$	44.4			$	(1.8	)			(4.1	)%

Research and development expense Research and development expenses decreased for the year to date period ended September 30, 2020 when compared to the year to date period ended September 30, 2019. The decrease is mainly due to cost reduction actions which began during the year as a response to the COVID-19 pandemic. We expect R&D costs to be approximately 2.5% - 3.5% of sales in future periods.

Amounts in millions, except percentage data		Year to Date Ended
		September 30, 2020				September 30, 2019				Change				%
Restructuring costs		$	5.5			$	11.7			$	(6.2	)			(53.0	)%

Restructuring costs. During the quarter ended September 30, 2017, we commenced a restructuring plan (“2017 Altra Plan”) as a result of the Stromag Acquisition and to rationalize our global renewable energy business. The actions taken pursuant to the 2017 Altra Plan included reducing headcount, facility consolidations and the elimination of certain costs. The total 2017 Altra Plan savings are in line with our expectations. We do not expect to incur any additional material costs as a result of the 2017 Altra Plan.

During 2019, we commenced a restructuring plan (“2019 Altra Plan”) to drive efficiencies, reduce the number of facilities and optimize our operating margin. We expect expenses related to workforce reductions, lease termination costs and other facility rationalization costs. We expect to incur $5 - $10 million in restructuring expenses under the 2019 Plan over the next 3 years, primarily related to plant consolidation and headcount reductions. We achieved savings of $0.8 million during the year to date period September 30, 2020 under the 2019 Altra Plan and estimate additional future savings during 2020 to be approximately $1.8 million. The cost savings for the year to date period ended September 30, 2020 were recognized as improvements in SG&A and Cost of Sales of approximately $0.7 million and $0.1 million, respectively.

Amounts in millions, except percentage data		Year to Date Ended
		September 30, 2020				September 30, 2019				Change				%
Interest expense, net		$	54.2			$	56.6			$	(2.4	)			(4.2	)%

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Interest expenseInterest expense decreased for the year to date period ended September 30, 2020 compared to the prior year period primarily due to debt paydowns of approximately $130.0 million since the fourth quarter of 2019. We expect our interest expense in 2020 to decrease as a result of additional principal payments, resulting in lower average outstanding borrowings, as well as lower average interest rates. This will be partially offset by non-cash interest expense as a result of the termination of the interest rate swap. As of September 30, 2020, the Company recorded approximately $5.6 million of non-cash interest expense related to the termination of the interest rate swap.

Amounts in millions, except percentage data		Year to Date Ended
		September 30, 2020				September 30, 2019				Change				%
Provision for income taxes		$	21.2			$	24.4			$	(3.2	)			(13.1	)%
Provision for income taxes as a percent of income before income taxes			(59.7	)%			21.3	%

Provision for Income Taxes The provision for income tax as a percentage of income before income taxes decreased for the year to date period ended September 30, 2020 as compared to the year to date period ended September 30, 2019. The decrease in the 2020 provision for income tax as a percent of income before income taxes is due to the one time impact of the $139.1 million non-cash impairment charge recorded at the JVS reporting unit in the United States and China and the additional tax benefit of $3.7 million as a result of changes in GILTI tax expense recorded in prior periods due to updated legislation. The Company also recognized discrete tax benefit related to changes in tax rates for the JVS reporting unit in China, and the impact of $5.1 million of withholding tax paid as a result of a dividend from two foreign subsidiaries. We expect our provision for income taxes before discrete items to be approximately 21% to 23% for the full year 2020.

Segment Performance

(Amounts in millions unless otherwise noted)

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net Sales:
Power Transmission Technologies		$	197.7			$	218.7			$	610.7			$	688.6
Automation & Specialty			240.8				224.8				665.2				707.2
Inter-segment eliminations			(0.7	)			(0.6	)			(3.1	)			(3.6	)
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2
(Loss)/Income from operations:
Segment earnings:
Power Transmission Technologies		$	23.5			$	26.3			$	73.0			$	87.1
Automation & Specialty			44.6				29.7				(48.0	)			102.1
Corporate expenses (1)			(0.3	)			(1.3	)			—				(5.5	)
Restructuring costs			(2.4	)			(6.2	)			(5.5	)			(11.7	)
(Loss)/Income from operations		$	65.4			$	48.5			$	19.5			$	172.0

(1)

Certain expenses are maintained at the corporate level and not allocated to the segments. These include various administrative expenses related to the Company’s corporate headquarters, certain U.S. healthcare costs and credits, depreciation on capitalized software costs, non-capitalizable software implementation costs and acquisition related expenses.

Power Transmission Technologies

Net sales in the Power Transmission Technologies segment were $197.7 million and $610.7 million in the quarter and year to date periods ended September 30, 2020, respectively. The decrease of approximately $21.0 million or 9.6%, and $77.9 million or 11.3% from the quarter and year to date periods ended September 30, 2019, respectively, is primarily due to the overall economic decline as a result of the COVID-19 pandemic and its impact on our turf and garden, agricultural, and oil and gas end markets. The decline in net sales was partially offset by strength in our renewable energy end market in China. In addition, changes in foreign exchange for the quarter ended September 30, 2020 had a favorable impact on net sales of $3.7 million, primarily driven by the Euro. However, for the year to date period September 30, 2020, changes in foreign exchange had an unfavorable impact of $3.4 million, primarily driven by the Euro and Chinese Renminbi. Price had a favorable impact on net sales for the quarter and year to date period ended September 30, 2020 of $2.4 million and $6.7 million, respectively. Income from operations for the quarter and year to date

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periods ended September 30, 2020 was $23.5 million, a decrease of 10.6%, and $73 million, a decrease of 16.2%, respectively, which is primarily driven by the decline in sales.

Automation & Specialty

Net sales in the Automation and Specialty segment were $240.8 million and $665.2 million in the quarter and year to date periods ended September 30, 2020, respectively. The increase for the quarter ended September 30, 2020 of approximately $16.0 million, or 7.1%, was primarily due to the recovery in the heavy-duty class 8 truck market in China. In addition, changes in foreign exchange for the quarter ended September 30, 2020 had a favorable impact of $2.0 million, primarily driven by the Euro. The decrease for the year to date period ended September 30, 2020 of $42.0 million, or 5.9%, is primarily due to the economic decline as a result of the COVID-19 pandemic, partially offset by modest growth in the class 8 heavy duty trucking end market, factory automation, aerospace and defense, and COVID-19 related medical end markets. In addition, despite being favorable for the quarter ended September 30, 2020, overall changes in foreign exchange had an unfavorable impact on net sales of $5.4 million for the year to date period ended September 30, 2020, primarily driven by the Euro, Indian Rupee and Chinese Renminbi. Price had a favorable impact on net sales for the quarter and year to date period ended September 30, 2020 of $2.3 million and $4.4 million, respectively. The Automation & Specialty segment had income from operations for the quarter ended September 30, 2020 of $44.6 million, an increase of $14.9 million, or 50.2%, primarily driven by the increase in sales. The Automation and Specialty segment had a loss from operations for the year to date period ended September 30, 2020, due to the non-cash impairment charge recorded at the JVS reporting unit during the quarter ended March 31, 2020. As a result of both the COVID-19 related economic downturn and its impact on the JVS reporting units anticipated financial results, the Company concluded that it was more likely than not that the JVS reporting unit’s carrying value exceeded its fair value and performed an interim impairment review for both JVS’s goodwill and tradename intangible assets, during the quarter ended March 30, 2020. As a result, the Company recorded non-cash impairment charges of $8.4 million and $139.1 million for goodwill and indefinite-lived intangible assets, respectively, in the quarter ended March 31, 2020.

Liquidity and Capital Resources

Overview

We finance our capital and working capital requirements through a combination of cash flows from operating activities and borrowings under the Altra Revolving Credit Facility (as defined herein). At September 30, 2020, we had the ability under the Altra Revolving Credit Facility to borrow an additional $294.8 million subject to satisfying customary conditions. We expect that our primary ongoing requirements for cash will be for working capital, debt service, capital expenditures, acquisitions, pensions, dividends and share repurchases.

On October 1, 2018 (the “A&S Closing Date”), we consummated the Fortive Transaction. The aggregate purchase price for the A&S Business was approximately $2,855.7 million, subject to certain post-closing adjustments, and consisted of (i) $1,400.0 million of cash transferred to Fortive and (ii) shares of Altra common stock received by Fortive shareholders valued at approximately $1,455.7 million. The value of the common stock was based on the closing stock price on the A&S Closing Date of $41.59. We financed the cash portion of the Fortive Transaction with the Altra Credit Facilities (as defined herein).

We believe, based on current and projected levels of cash flows from operating activities, together with our ability to borrow under the Altra Revolving Credit Facility, that we have sufficient liquidity to make required payments of interest on our debt, to make amortization payments under the Altra Credit Facilities , to fund our operating needs, to fund working capital and capital expenditure requirements and to comply with the financial ratios in our debt agreements. It is difficult, however, to predict the severity and duration of the economic decline due to the impact of the COVID-19 pandemic but we have taken several proactive measures to protect our balance sheet and strengthen our liquidity position, as discussed above under “Business Outlook.”

In the event additional funds are needed for operations, we could attempt to obtain new debt and/or refinance existing debt, or attempt to raise capital in the equity markets. There can be no assurance however that additional debt or equity financing will be available on commercially acceptable terms, if at all.

Notes

On September 26, 2018, Stevens Holding Company, Inc., a wholly owned subsidiary of the Company (“Stevens Holding”), announced the pricing of $400.0 million aggregate principal amount of Stevens Holding’s 6.125% senior notes due 2026 (the “Notes”) in a private debt offering pursuant to Rule 144A and Regulation S under the Securities Act of 1933 (the “Private Placement”). On October 1, 2018, the Private Placement closed, and Stevens Holding sold $150.0 million aggregate principal amount of the Notes (the “Primary Notes”) and an unaffiliated selling securityholder sold $250.0 million aggregate principal amount of the Notes (the “Selling Securityholder Notes”). The Notes will mature on October 1, 2026. Interest on the Notes accrues from October 1, 2018, and the first interest payment date on the Notes was April 1, 2019. The Notes may be redeemed at the option of Stevens Holding on or after October 1, 2023, in the manner and at the redemption prices specified in the indenture governing the Notes, plus accrued and unpaid

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interest thereon, if any, to, but excluding, the date of redemption. The Notes are guaranteed on a senior unsecured basis by Altra and certain of its domestic subsidiaries.

The unaffiliated selling securityholder received the Selling Securityholder Notes from Fortive prior to the closing of the Private Placement in exchange for certain outstanding Fortive debt held or acquired by the unaffiliated selling securityholder. Stevens Holding used the net proceeds of the Primary Notes to fund a dividend payment to Fortive prior to the consummation of the Merger, and Stevens Holding did not receive any proceeds from the sale of the Selling Securityholder Notes.

Altra Credit Agreement

On the A&S Closing Date, Altra entered into the Altra Credit Agreement with certain subsidiaries of Altra, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, and a syndicate of lenders. The Altra Credit Agreement provides for a seven-year senior secured term loan to Altra in an aggregate principal amount of $1,340.0 million (the “Altra Term Loan Facility”) and a five-year senior secured revolving credit facility provided to Altra and certain of its subsidiaries in an aggregate committed principal amount of $300.0 million (the “Altra Revolving Credit Facility” and together with the Altra Term Loan Facility, the “Altra Credit Facilities”). The proceeds of the Altra Term Loan Facility were used to (i) consummate the Direct Sales, (ii) repay in full and extinguish all outstanding indebtedness for borrowed money under the 2015 Credit Agreement and (iii) pay certain fees, costs, and expenses in connection with the consummation of the Fortive Transaction. Any proceeds of the Altra Term Loan Facility not so used may be used for general corporate purposes. The proceeds of the Altra Revolving Credit Facility will be used for working capital and general corporate purposes.

The Altra Credit Facilities are guaranteed on a senior secured basis by Altra and by each direct or indirect wholly owned domestic subsidiary of Altra, subject to certain customary exceptions.

Borrowings under the Altra Term Loan Facility will bear interest at a per annum rate equal to a “Eurocurrency Rate” plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a “Base Rate” plus 1.00%, in the case of Base Rate borrowings. Borrowings under the Altra Revolving Credit Facility will initially bear interest at a per annum rate equal to a Eurocurrency Rate plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a Base Rate plus 1.00%, in the case of Base Rate borrowings, and thereafter will bear interest at a per annum rate equal to a Eurocurrency Rate or Base Rate, as applicable, plus an interest rate spread determined by reference to a pricing grid based on Altra’s senior secured net leverage ratio. In addition, Altra will be required to pay fees that will fluctuate between 0.250% per annum to 0.375% per annum on the unused amount of the Altra Revolving Credit Facility, based upon Altra’s senior secured net leverage ratio. The interest rate on the Altra Term Loan Facility was 2.146% at September 30, 2020.

The Company provided notice to the administrative agent of the Altra Credit Agreement on March 9, 2020 and March 16, 2020 to draw down $50 million and $50 million, respectively, under the Altra Revolving Credit Facility. At that time, the Company had increased its borrowings under the Altra Revolving Credit Facility as a precautionary action in order to increase its cash position and enhance its financial flexibility during this period of uncertainty in the global markets resulting from COVID-19. On April 14, 2020, the Company provided notice to the administrative agent of the Altra Credit Agreement to repay $50 million outstanding under the Altra Revolving Credit Facility. On April 27, 2020 and May 27, 2020 the Company provided notice to the administrative agent to repay $15 million and $35 million, respectively, which were outstanding under the Altra Revolving Credit Facility. As of the period ended September 30, 2020, all outstanding borrowings under the Altra Revolving Credit Facility have been repaid.

As of September 30, 2020, the Company had $1,100.0 million outstanding on the Altra Credit Agreement. As of September 30, 2020 and December 31, 2019, the Company had $5.2 million and $4.4 million in letters of credit outstanding, respectively. The Company had $294.8 million available to borrow under the Altra Credit Facilities at September 30, 2020.

Revolving borrowings and issuances of letters of credit under the Altra Revolving Credit Facility are subject to the satisfaction of customary conditions, including the accuracy of representations and warranties and the absence of defaults.

The Altra Credit Agreement contains usual and customary representations and warranties, and usual and customary affirmative and negative covenants, including limitations on liens, investments, restricted payments, additional indebtedness and asset sales and mergers. In addition, the Altra Credit Agreement requires that Altra maintain a specified maximum senior secured leverage ratio and a specified minimum interest coverage ratio. The obligations of the borrowers of the Altra Credit Facilities under the Altra Credit Agreement may be accelerated upon customary events of default, including non-payment of principal, interest, fees and other amounts, inaccuracy of representation and warranties, violation of covenants, cross default and cross acceleration, voluntary and involuntary bankruptcy or insolvency proceedings, inability to pay debts as they become due, material judgments, ERISA events, actual or asserted invalidity of security documents or guarantees and change in control.

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Borrowings

The following is a summary of our borrowings as of September 30, 2020 and September 30, 2019, respectively:

		Amounts in millions
		September 30, 2020				September 30, 2019
Debt:
Term loan		$	1,100.0			$	1,230.0
Revolving Credit Facility			—				—
Notes			400.0				400.0
Mortgages and other			12.4				14.1
Finance leases			0.3				0.5
Total debt		$	1,512.7			$	1,644.6

Cash and Cash Equivalents

The following is a summary of our cash balances and cash flows (in millions) as of and for the year to date periods ended September 30, 2020 and September 30, 2019, respectively:

		September 30, 2020				September 30, 2019				Change
Cash and cash equivalents at the beginning of the period		$	167.3			$	169.0			$	(1.7	)
Cash flows provided by operating activities			161.8				180.4				(18.6	)
Cash flows provided by (used in) investing activities			30.0				(50.0	)			80.0
Cash flows provided used in financing activities			(120.2	)			(125.8	)			5.6
Effect of exchange rate changes on cash and cash equivalents			(0.2	)			(5.6	)			5.4
Cash and cash equivalents at the end of the period		$	238.7			$	168.0			$	70.7

Cash Flows for 2020

Net cash provided by operating activities was approximately $161.8 million for the year to date period ended September 30, 2020. This was generated by a net loss of $56.7 million offset by the net impact of the add-back of certain items including non-cash depreciation, amortization of intangible assets, stock-based compensation, amortization of deferred financing costs, non-cash loss on foreign currency, the payment from interest rate swap hedge settlement of approximately $34.7 million and the non-cash impairment charge to goodwill and intangible assets which totaled approximately $227.8 million. This was partially offset by a use of cash from a net increase in assets and liabilities of approximately $9.3 million.

Net cash provided by investing activities for the year to date period ended September 30, 2020 increased approximately $80.0 million compared to the period ended September 30, 2019, primarily due to the cross currency interest rate swap settlement proceeds of approximately $56.2 million received during the first quarter of 2020.

Net cash used in financing activities for the year to date period ended September 30, 2020 as compared to the period ended September 30, 2019 decreased by $5.6 million, primarily as a result of the decrease in dividend payments compared to the prior year.

We intend to use our remaining cash and cash equivalents and cash flow from operations to provide for our working capital needs, to service our debt, including principal payments, for capital expenditures, for pension funding, and to pay dividends to our stockholders. As of September 30, 2020 we have approximately $144.3 million of cash and cash equivalents held by foreign subsidiaries. We believe, based on current and projected levels of cash flows from operating activities, together with our ability to borrow under the Altra Revolving Credit Facility, that we have sufficient liquidity to make required payments of interest on our debt, to make amortization payments under the Altra Credit Facilities, to fund our operating needs, to fund working capital and capital expenditure requirements and to comply with the financial ratios in our debt agreements. It is difficult, however, to predict the severity and duration of the economic decline due to the impact of the COVID-19 pandemic and any potential resulting impact to our cash flows.

Contractual Obligations

There were no material changes in our contractual obligations during the period ended September 30, 2020.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are exposed to various market risk factors such as fluctuating interest rates, changes in foreign currency rates, and changes in commodity prices. Since the beginning of the fiscal year, we have terminated our interest rate swap agreements and cross-currency interest rate swap agreements. However, there is no material change to our sensitivity analyses and other quantitative and qualitative disclosures regarding our market risk set forth in our Annual Report on Form 10-K for the year ended December 31, 2019.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

As of September 30, 2020, our management, under the supervision and with the participation of our chief executive officer and chief financial officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in the reports that we file or submit under the Exchange Act, such as this Quarterly Report on Form 10-Q, is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officers, as appropriate, to allow timely decisions regarding required disclosures. Based upon that evaluation, our chief executive officer and chief financial officer have concluded that, as of September 30, 2020, our disclosure controls and procedures were effective at a reasonable assurance level.

Changes in Internal Control Over Financial Reporting

There has been no change in our internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during our fiscal quarter ended September 30, 2020, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings

We are, from time to time, party to various legal proceedings arising out of our business. During the reporting period, there have been no material changes to the description of legal proceedings set forth in our Annual Report on Form 10-K for the year ended December 31, 2019.

Item 1A. Risk Factors

The reader should carefully consider the Risk Factors described in our Annual Report on Form 10-K for the year ended December 31, 2019 filed with the Securities and Exchange Commission. Those risk factors described elsewhere in this report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2019 are not the only ones we face, but are considered to be the most material. These risk factors could cause our actual results to differ materially from those stated in forward looking statements contained in this Form 10-Q and elsewhere. All risk factors stated in our Annual Report on Form 10-K for the year ended December 31, 2019 are incorporated herein by reference.

During the reporting period, except as noted below, there were no material changes to the risk factors previously disclosed in our Annual Report on Form 10-K for the year ended December 31, 2019, as updated by our Quarterly Report on Form 10-Q for the quarter ended March 31, 2020.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

(a) Recent Sales of Unregistered Equity Securities

None.

(b) Use of Proceeds

None.

(c) Issuer Purchases of Equity Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not Applicable.

Item 5. Other Information

None.

38

Item 6. Exhibits

The following exhibits are filed as part of this report:

Exhibit Number		Description

3.1(1)		Certificate of Amendment to the Second Amended and Restated Articles of Incorporation of Altra industrial Motion Corp., as filed with the Secretary of State of the State of Delaware.

3.2(2)		Second Amended and Restated Certificate of Incorporation of the Registrant

3.3(3)		Second Amended and Restated Bylaws of the Registrant

31.1*		Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**		Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**		Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101*		The following materials from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020, formatted in iXBRL (Inline Extensible Business Reporting Language): (i) the Unaudited Condensed Consolidated Statement of Operations, (ii) the Unaudited Condensed Consolidated Statement of Comprehensive Income (Loss), (iii) the Unaudited Condensed Consolidated Balance Sheet, (iv) the Unaudited Condensed Consolidated Statement of Cash Flows, (v) the Unaudited Consolidated Statement of Stockholders’ Equity and (vi) Notes to Unaudited Condensed Consolidated Interim Financial Statements.

104		The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2020, formatted in iXBRL and contained in Exhibit 101.

*	Filed herewith.

**

This certification is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act.

†	Management contract or compensatory plan or arrangement

(1)	Incorporated by reference to Altra Industrial Motion Corp.’s Current Report on Form 8-K, filed with the SEC on October 1, 2018.

(2)	Incorporated by reference to Altra Industrial Motion Corp.’s (formerly known as Altra Holdings, Inc.) Amendment No. 4 to Registration Statement on Form S-1/A filed with the SEC on December 4, 2006.

(3)	Incorporated by reference to Altra Industrial Motion Corp.’s Current Report on Form 8-K, filed with the SEC on October 27, 2008.

39

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		ALTRA INDUSTRIAL MOTION CORP.

October 28, 2020	By:	/s/ Carl R. Christenson
	Name:	Carl R. Christenson
	Title	Chairman and Chief Executive Officer
		(Principal Executive Officer)
October 28, 2020	By:	/s/ Christian Storch
	Name:	Christian Storch
	Title:	Vice President and Chief Financial Officer
		(Principal Financial Officer)
October 28, 2020	By:	/s/ Todd B. Patriacca
	Name:	Todd B. Patriacca
	Title:	Vice President of Finance, Corporate Controller and Treasurer
		(Principal Accounting Officer)

40

aimc-ex311_7.htm

EXHIBIT 31.1

Certification of Chief Executive Officer

I, Carl R. Christenson, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Altra Industrial Motion Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 28, 2020	By:		/s/ Carl R. Christenson
	Name:		Carl R. Christenson
	Title:		Chairman and Chief Executive Officer

aimc-ex312_10.htm

EXHIBIT 31.2

Certification of Chief Financial Officer

I, Christian Storch, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Altra Industrial Motion Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: October 28, 2020	By:		/s/ Christian Storch
	Name:		Christian Storch
	Title:		Vice President and Chief Financial Officer

aimc-ex321_13.htm

Exhibit 32.1

CERTIFICATION PURSUANT TO SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Altra Industrial Motion Corp. (the “Company”) on Form 10-Q for the period ended September 30, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Carl R. Christenson, Chairman and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: October 28, 2020		By:		/s/ Carl R. Christenson
		Name:		Carl R. Christenson
		Title:		Chairman and Chief Executive Officer

aimc-ex322_11.htm

Exhibit 32.2

CERTIFICATION PURSUANT TO SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Altra Industrial Motion Corp. (the “Company”) on Form 10-Q for the period ended September 30, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Christian Storch, Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: October 28, 2020		By:		/s/ Christian Storch
		Name		Christian Storch
		Title:		Vice President and Chief Financial Officer

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2020	Oct. 27, 2020
Cover [Abstract]
Entity Registrant Name	ALTRA INDUSTRIAL MOTION CORP.
Entity Central Index Key	0001374535
Trading Symbol	AIMC
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Document Type	10-Q
Document Period End Date	Sep. 30, 2020
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity File Number	001-33209
Entity Tax Identification Number	61-1478870
Entity Address, Address Line One	300 Granite Street
Entity Address, Address Line Two	Suite 201
Entity Address, City or Town	Braintree
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02184
City Area Code	781
Local Phone Number	917-0600
Entity Common Stock, Shares Outstanding (in shares)		64,714,022
Entity Interactive Data Current	Yes
Entity Incorporation, State or Country Code	DE
Security Exchange Name	NASDAQ
Document Quarterly Report	true
Document Transition Report	false
Title of 12(b) Security	Common Stock, $0.001 par value

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Sep. 30, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 238.7	$ 167.3
Trade receivables, less allowance for credit losses of $5.7 and $5.1 million at September 30, 2020 and December 31, 2019, respectively	237.0	243.2
Inventories	219.2	222.5
Income tax receivable	13.6	5.2
Prepaid expenses and other current assets	35.4	29.1
Total current assets	743.9	667.3
Property, plant and equipment, net	336.7	354.4
Goodwill	1,563.4	1,694.9
Intangible assets, net	1,451.9	1,502.4
Deferred income taxes	1.0	3.0
Other non-current assets	9.2	25.1
Operating lease right of use assets	39.8	36.6
Total assets	4,145.9	4,283.7
Current liabilities:
Accounts payable	139.9	154.7
Accrued payroll	63.1	58.3
Accruals and other current liabilities	77.4	82.0
Income tax payable	10.0	13.2
Current portion of long-term debt	16.5	18.0
Operating lease liabilities	12.7	13.5
Total current liabilities	319.6	339.7
Long-term debt - less current portion	1,476.9	1,563.8
Deferred income taxes	374.0	369.1
Pension liabilities	31.4	30.8
Long-term taxes payable	2.7	4.5
Other long-term liabilities	16.3	28.8
Operating lease liabilities, net of current portion	29.2	24.7
Commitments and Contingencies (Note 16)
Stockholders’ equity:
Common stock ($0.001 par value per share, 120,000,000 shares authorized, 64,665,347 and 64,222,603 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively)	0.1	0.1
Additional paid-in capital	1,703.1	1,696.7
Retained earnings	242.3	315.4
Accumulated other comprehensive loss	(49.7)	(89.9)
Total stockholders’ equity	1,895.8	1,922.3
Total liabilities and stockholders’ equity	$ 4,145.9	$ 4,283.7

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Sep. 30, 2020	Dec. 31, 2019
Statement Of Financial Position [Abstract]
Allowance for credit losses	$ 5.7	$ 5.1
Common stock, par value (in USD per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	120,000,000	120,000,000
Common stock, shares issued (in shares)	64,665,347	64,222,603
Common stock, shares outstanding (in shares)	64,665,347	64,222,603

Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Income Statement [Abstract]
Net sales	$ 437.8	$ 442.9	$ 1,272.8	$ 1,392.2
Cost of sales	273.7	285.9	812.3	893.3
Gross profit	164.1	157.0	460.5	498.9
Operating expenses:
Selling, general and administrative expenses	82.5	87.9	245.4	270.8
Impairment of goodwill and intangible asset			147.5
Research and development expenses	13.8	14.4	42.6	44.4
Restructuring costs	2.4	6.2	5.5	11.7
Total operating expenses	98.7	108.5	441.0	326.9
Income from operations	65.4	48.5	19.5	172.0
Other non-operating income and expense:
Interest expense, net	18.0	18.2	54.2	56.6
Other non-operating expense/(income), net	(0.3)	(0.4)	0.8	1.1
Total other non-operating (income) expense, net	17.7	17.8	55.0	57.7
Income/(Loss) before income taxes	47.7	30.7	(35.5)	114.3
Provision for income taxes	9.4	5.0	21.2	24.4
Net income/(loss)	$ 38.3	$ 25.7	$ (56.7)	$ 89.9
Weighted average shares, basic	64.6	64.4	64.6	64.3
Weighted average shares, diluted	64.9	64.6	64.6	64.5
Net income/(loss) per share:
Basic	$ 0.59	$ 0.40	$ (0.88)	$ 1.40
Diluted	0.59	0.40	(0.88)	1.39
Cash dividend declared per share	$ 0.04	$ 0.17	$ 0.25	$ 0.51

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Statement Of Income And Comprehensive Income [Abstract]
Net Income/(loss)	$ 38.3	$ 25.7	$ (56.7)	$ 89.9
Other Comprehensive income:
Foreign currency translation adjustment	47.6	(58.7)	16.5	(66.3)
Change in pension liability adjustment	0.2		0.1	(0.3)
Non-cash amortization of interest rate swap expense, net of tax	2.6		4.3
Change in fair value of derivative financial instruments, net of tax		25.5	19.3	23.0
Total other comprehensive income/(loss):	50.4	(33.2)	40.2	(43.6)
Comprehensive income/(loss)	$ 88.7	$ (7.5)	$ (16.5)	$ 46.3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Cash flows from operating activities
Net Income/(loss)	$ (56.7)	$ 89.9
Adjustments to reconcile net income to net operating cash flows:
Depreciation	44.2	43.5
Amortization of intangible assets	52.3	52.9
Amortization of deferred financing costs	3.4	3.8
Loss on foreign currency, net	(1.2)	(0.5)
Accretion of debt discount	0.4
Non-cash amortization of interest rate swap expense	5.6
Impairment of goodwill and intangible asset	147.5
Payment for interest rate swap settlement	(34.7)
Loss on disposal and other		0.2
Stock-based compensation	10.3	10.1
Changes in assets and liabilities:
Trade receivables	7.9	10.2
Inventories	4.3	(3.7)
Accounts payable, accrued payroll, accruals and current liabilities	(2.7)	(15.3)
Other current assets and liabilities	(23.2)	(10.3)
Other operating assets and liabilities	4.4	(0.4)
Net cash provided by operating activities	161.8	180.4
Cash flows from investing activities
Purchase of property, plant and equipment	(24.3)	(36.9)
A&S acquisition purchase price adjustment	(1.9)	(13.5)
Proceeds from sale of building		0.4
Proceeds from cross currency interest rate swap settlement	56.2
Net cash provided by (used in) investing activities	30.0	(50.0)
Cash flows from financing activities
Borrowing under Revolving Credit Facility	100.0
Payments on Revolving Credit Facility	(100.0)
Payments on Term Loan Facility	(90.0)	(90.0)
Dividend payments	(24.9)	(33.1)
Net payments on financing leases, mortgages, and other obligations	(0.3)	(0.9)
Net proceeds/(payments) from China debt	(1.1)	2.1
Shares surrendered for tax withholding	(3.9)	(3.9)
Net cash used in financing activities	(120.2)	(125.8)
Effect of exchange rate changes on cash and cash equivalents	(0.2)	(5.6)
Net change in cash and cash equivalents	71.4	(1.0)
Cash and cash equivalents at beginning of period	167.3	169.0
Cash and cash equivalents at end of period	238.7	168.0
Cash paid during the period for:
Interest paid on borrowings	38.8	33.8
Income taxes paid	$ 43.5	$ 37.1

Condensed Consolidated Statements of Stockholders' Equity - USD ($) shares in Millions, $ in Millions	Total	Common Stock [Member]	Additional Paid in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]
Beginning balance at Dec. 31, 2018	$ 1,848.2	$ 0.1	$ 1,687.1	$ 232.6	$ (71.6)
Beginning balance (in shares) at Dec. 31, 2018		64.2
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation and vesting of restricted stock, net of withholdings	6.2		6.2
Stock-based compensation and vesting of restricted stock, net of withholdings, (in shares)		0.3
Net income (loss)	89.9			89.9
Dividends declared	(33.2)			(33.2)
Change in fair value of derivative financial instruments, net of tax	23.0				23.0
Minimum pension adjustment, net of tax	(0.3)				(0.3)
Cumulative foreign currency translation adjustment	(66.3)				(66.3)
Ending balance at Sep. 30, 2019	1,867.5	$ 0.1	1,693.3	289.3	(115.2)
Ending balance (in shares) at Sep. 30, 2019		64.5
Beginning balance at Jun. 30, 2019	1,884.4	$ 0.1	1,691.8	274.5	(82.0)
Beginning balance (in shares) at Jun. 30, 2019		64.3
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation and vesting of restricted stock, net of withholdings	1.5		1.5
Stock-based compensation and vesting of restricted stock, net of withholdings, (in shares)		0.2
Net income (loss)	25.7			25.7
Dividends declared	(10.9)			(10.9)
Change in fair value of derivative financial instruments, net of tax	25.5				25.5
Cumulative foreign currency translation adjustment	(58.7)				(58.7)
Ending balance at Sep. 30, 2019	1,867.5	$ 0.1	1,693.3	289.3	(115.2)
Ending balance (in shares) at Sep. 30, 2019		64.5
Beginning balance at Dec. 31, 2019	1,922.3	$ 0.1	1,696.7	315.4	(89.9)
Beginning balance (in shares) at Dec. 31, 2019		64.2
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation and vesting of restricted stock, net of withholdings	6.4		6.4
Stock-based compensation and vesting of restricted stock, net of withholdings, (in shares)		0.5
Net income (loss)	(56.7)			(56.7)
Dividends declared	(16.4)			(16.4)
Change in fair value of derivative financial instruments, net of tax	19.3				19.3
Non-cash amortization of interest rate swap expense, net of tax	4.3				4.3
Minimum pension adjustment, net of tax	0.1				0.1
Cumulative foreign currency translation adjustment	16.5				16.5
Ending balance at Sep. 30, 2020	1,895.8	$ 0.1	1,703.1	242.3	(49.7)
Ending balance (in shares) at Sep. 30, 2020		64.7
Beginning balance at Jun. 30, 2020	1,808.5	$ 0.1	1,701.8	206.7	(100.1)
Beginning balance (in shares) at Jun. 30, 2020		64.6
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation and vesting of restricted stock, net of withholdings	1.3		1.3
Stock-based compensation and vesting of restricted stock, net of withholdings, (in shares)		0.1
Net income (loss)	38.3			38.3
Dividends declared	(2.7)			(2.7)
Non-cash amortization of interest rate swap expense, net of tax	2.6				2.6
Minimum pension adjustment, net of tax	0.2				0.2
Cumulative foreign currency translation adjustment	47.6				47.6
Ending balance at Sep. 30, 2020	$ 1,895.8	$ 0.1	$ 1,703.1	$ 242.3	$ (49.7)
Ending balance (in shares) at Sep. 30, 2020		64.7

Condensed Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Cash dividend declared	$ 0.04	$ 0.17	$ 0.25	$ 0.51
Retained Earnings [Member]
Cash dividend declared	$ 0.04	$ 0.17	$ 0.25	$ 0.51

Organization and Nature of Operations

9 Months Ended

Sep. 30, 2020

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Organization and Nature of Operations

1. Organization and Nature of Operations

Headquartered in Braintree, Massachusetts, Altra Industrial Motion Corp. (the “Company,” “Altra,” “we,” or “our”) is a leading global designer, producer and marketer of a wide range of electro-mechanical power transmission and motion control products. The Company brings together strong brands with production facilities in seventeen countries. Altra’s leading brands include Ameridrives Couplings, Bauer Gear Motor, Bibby Turboflex, Boston Gear, Delroyd Worm Gear, Formsprag Clutch, Guardian Couplings, Huco, Industrial Clutch, Inertia Dynamics, Jacobs Vehicle Systems, Kilian Manufacturing, Kollmorgen, Lamiflex Couplings, Marland Clutch, Matrix, Nuttall Gear, Portescap, Stieber Clutch, Stromag, Svendborg Brakes, TB Wood’s, Thomson, Twiflex, Warner Electric, Warner Linear, and Wichita Clutch.

Basis of Presentation

9 Months Ended

Sep. 30, 2020

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Basis of Presentation

2. Basis of Presentation

The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the United States, or GAAP. These statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 27, 2020 (the “2019 Annual Report on Form 10-K”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary to present fairly the Company’s financial position and cash flows for the interim periods presented. The results are not necessarily indicative of future results. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure.

Recent Accounting Standards

9 Months Ended

Sep. 30, 2020

Accounting Changes And Error Corrections [Abstract]

Recent Accounting Standards

3. Recent Accounting Standards

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires the use of the current expected credit loss impairment model to estimate credit losses on certain types of financial instruments, including trade receivables. The model requires an estimate of expected credit losses, measured over the contractual life of an asset, that considers information about past events, current conditions and a forecast of future economic conditions. The Company adopted the standard on January 1, 2020. The adoption of the standard did not have a material impact on our consolidated financial statements.

As a result of the adoption of ASU 2016-13, the Company has updated its significant accounting policy related to trade account receivables and allowances for credit losses as of March 31, 2020 from what was previously disclosed in our audited financial statements for the year ended December 31, 2019 as follows:

All trade account receivables are reported net of allowances for credit losses. The allowances for credit losses represent management’s best estimate of the credit losses expected from our trade account receivables over the life of the underlying assets. Assets with similar risk characteristics are pooled together for determination of their current expected credit losses. We regularly perform detailed reviews of our pooled assets to evaluate the collectability of receivables based on a combination of past, current, and future financial and qualitative factors that may affect customers’ ability to pay. In circumstances where we are aware of a specific customer’s inability to meet its financial obligations, a specific reserve is recorded against amounts due to reduce the recognized receivable to the amount reasonably expected to be collected.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). The amendments in ASU 2018-13 modify the disclosure requirements on fair value measurements. The Company adopted the standard on January 1, 2020. The adoption of the standard did not have a material impact on our consolidated financial statements.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). This ASU provides relief from certain accounting consequences that could result from the global markets’ anticipated transition away from the use of the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. The relief provided by this ASU is elective and applies to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The optional amendments are effective as of March 12, 2020 through December 31, 2022. The Company is currently evaluating the effect of the adoption of this standard on the Company.

Revenue Recognition

9 Months Ended

Sep. 30, 2020

Revenue From Contract With Customer [Abstract]

Revenue Recognition

4. Revenue Recognition

We sell our products through three primary commercial channels: original equipment manufacturers (OEMs), industrial distributors and direct to end users. Each of our segments sells similar products, which are balanced across end-user industries including, without limitation, energy, food processing, general industrial, material handling, mining, transportation, industrial automation, robotics, medical devices, and turf & garden.

As the Company’s standard payment terms are less than one year, the Company has elected the practical expedient under ASC 606-10-32-18 to not assess whether a contract has a significant financing component. Revenue is recognized when control of the product is transferred to the customer (i.e., when the Company’s performance obligation is satisfied), which typically occurs at shipment from the Company’s manufacturing site or delivery to the customer’s named location. In determining whether control has transferred, the Company considers if there is a present right to payment and legal title, along with risks and rewards of ownership having transferred to the customer. In certain circumstances, the Company manufactures customized product without alternative use for its customers, which would generally result in the transfer of control over time. The Company has evaluated the amount of revenue subject to recognition over time and concluded that it is immaterial.

The following table disaggregates our revenue for each reportable segment. The Company believes that disaggregating revenue into these categories achieves the disclosure objective to depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net Sales:
Power Transmission Technologies		$	197.7			$	218.7			$	610.7			$	688.6
Automation & Specialty			240.8				224.8				665.2				707.2
Inter-segment eliminations			(0.7	)			(0.6	)			(3.1	)			(3.6	)
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2

Net sales by geographic region based on point of shipment origin are as follows:

		Net Sales
		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
North America (primarily U.S.)		$	230.2			$	251.5			$	681.3			$	794.3
Europe excluding Germany			68.8				72.1				214.9				233.8
Germany			44.1				54.9				140.7				173.9
China			56.5				35.1				150.1				105.8
Asia and other (excluding China)			38.2				29.3				85.8				84.4
Total		$	437.8			$	442.9			$	1,272.8			$	1,392.2

The payment terms and conditions in our customer contracts vary. In some cases, customers will partially prepay for their goods; in other cases, after appropriate credit evaluations, payment will be due in arrears. In addition, there are constraints that cause variability in the ultimate consideration to be recognized. These constraints typically include early payment discounts, volume rebates, rights of return, surcharges, and other customer considerations.

A contract asset is created when the Company satisfies a performance obligation by transferring a promised good to the customer. Contract assets may represent conditional or unconditional rights to consideration. A right is conditional, and recorded as a contract asset, if, for example, the Company must first satisfy another performance obligation in the contract before it is entitled to payment from the customer. Contract assets are transferred to accounts receivable once the right becomes unconditional. A right is unconditional if nothing other than the passage of time is required before payment of that consideration is due. If the Company receives a customer payment prior to satisfying a performance obligation or in excess of estimates of what the Company expects to be entitled to, the payment is recorded as a contract liability. Contracts with payment in arrears are recognized as receivables.

The opening and closing balances of the Company’s contract liability and accounts receivable as of the year to date period ended September 30, 2020 are as follows:

		Deferred Revenue (Current)				Accounts Receivable
Beginning - January 1, 2020		$	8.4			$	243.2
Closing - September 30, 2020			11.2				237.0
Increase/(Decrease)		$	2.8			$	(6.2	)

		Deferred Revenue (Current)				Accounts Receivable
Beginning - January 1, 2019		$	7.4			$	259.8
Closing - September 30, 2019			10.6				244.3
Increase/(Decrease)		$	3.2			$	(15.5	)

In the nine-month period ended September 30, 2020, substantially all outstanding revenue has been recognized related to contract liabilities outstanding at January 1, 2020.

Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

5. Fair Value of Financial Instruments

Fair value is determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, as determined by either the principal market or the most advantageous market. Inputs used in the valuation techniques to derive fair values are classified based on a three-level hierarchy, as follows:

•

Level 1- Quoted prices in active markets for identical assets or liabilities.

•

Level 2- Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived.

•

Level 3- Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities.

The Company considers all highly liquid investments purchased with a remaining maturity of three months or less to be cash equivalents and are classified as Level 1.

The Company determines the fair value of financial instruments using quoted market prices whenever available. When quoted market prices are not available for various types of financial instruments (such as forwards, options and swaps), the Company uses standard models with market-based inputs, which take into account the present value of estimated future cash flows and the ability of the Company or the financial counterparty to perform. For interest rate and cross currency swaps, the significant inputs to these models are interest rate curves for discounting future cash flows and are adjusted for credit risk. For forward foreign currency contracts, the significant inputs are interest rate curves for discounting future cash flows and exchange rate curves of the foreign currency for translating future cash flows. See additional discussion of the Company’s use of financial instruments including cross-currency swaps and interest rate swaps included in Note 15.

The carrying values of financial instruments, including cash equivalents, accounts payable, and other accrued liabilities are carried at cost, which approximates fair value. Debt under the Altra Credit Agreement (as defined herein) is comprised of the Altra Term Loan Facility and the Altra Revolving Credit Facility (both as defined herein). The carrying amount of the Altra Term Loan Facility was $1,100.0 million and the estimated fair value of the Altra Term Loan Facility was $1,071.1 million at September 30, 2020. There is currently no debt under the Altra Revolving Credit Facility. Further, the Altra Credit Agreement was negotiated in October 2018 and there have not been any significant changes in our credit rating. The carrying amount of the Notes (as defined herein) was $400 million and the estimated fair value of the Notes was $425.0 million at September 30, 2020.

Changes in Accumulated Other Comprehensive Income/(Loss) by Component

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Changes in Accumulated Other Comprehensive Income/(Loss) by Component

6. Changes in Accumulated Other Comprehensive Income/(Loss) by Component

The following is a reconciliation of changes in accumulated other comprehensive income/(loss) by component for the periods presented:

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, June 30, 2020		$	18.0			$	(1.6	)		$	(116.5	)		$	(100.1	)
Other Comprehensive Income (Loss) before reclassification			—				0.2				47.6				47.8
Reclassification out of Other Comprehensive Income (Loss)			2.6				—				—				2.6
Net current-period Other Comprehensive Income (Loss)			2.6				0.2				47.6				50.4
Accumulated Other Comprehensive (Loss) by Component, September 30, 2020		$	20.6			$	(1.4	)		$	(68.9	)		$	(49.7	)

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, January 1, 2020		$	(3.0	)		$	(1.5	)		$	(85.4	)		$	(89.9	)
Other Comprehensive Income (Loss) before reclassification			19.9				0.1				16.5				36.5
Reclassification out of Other Comprehensive Income (Loss)			3.7				—				—				3.7
Net current-period Other Comprehensive Income (Loss)			23.6				0.1				16.5				40.2
Accumulated Other Comprehensive (Loss) by Component, September 30, 2020		$	20.6			$	(1.4	)		$	(68.9	)		$	(49.7	)

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, June 30, 2019		$	(15.4	)		$	(0.5	)		$	(66.1	)		$	(82.0	)
Other Comprehensive Income (Loss) before reclassfication			27.9				—				(58.7	)			(30.8	)
Reclassification out of Other Comprehensive Income (Loss)			(2.4	)			—				—				(2.4	)
Net current-period Other Comprehensive Income (Loss)			25.5				—				(58.7	)			(33.2	)
Accumulated Other Comprehensive (Loss) by Component, September 30, 2019		$	10.1			$	(0.5	)		$	(124.8	)		$	(115.2	)

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, January 1, 2019		$	(12.9	)		$	(0.2	)		$	(58.5	)		$	(71.6	)
Other Comprehensive Income (Loss) before reclassfication			30.4				(0.3	)			(66.3	)			(36.2	)
Reclassification out of Other Comprehensive Income (Loss)			(7.4	)			—				—				(7.4	)
Net current-period Other Comprehensive Income (Loss)			23.0				(0.3	)			(66.3	)			(43.6	)
Accumulated Other Comprehensive (Loss) by Component, September 30, 2019		$	10.1			$	(0.5	)		$	(124.8	)		$	(115.2	)

Net Income per Share

9 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Net Income per Share

7. Net Income per Share

Basic earnings per share is based on the weighted average number of shares of common stock outstanding, and diluted earnings per share is based on the weighted average number of shares of common stock outstanding and all potentially dilutive common stock equivalents outstanding. Common stock equivalents are included in the per share calculations when the effect of their inclusion is dilutive.

The following is a reconciliation of basic to diluted net income per share:

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9
Shares used in net income per common share - basic			64.6				64.4				64.6				64.3
Incremental shares of unvested restricted common stock			0.3				0.2				—				0.2
Shares used in net income per common share - diluted			64.9				64.6				64.6				64.5
Shares excluded as their inclusion would be anti-dilutive			—				—				0.1				—
Earnings/(Loss) per share:
Basic net income		$	0.59			$	0.40			$	(0.88	)		$	1.40
Diluted net income		$	0.59			$	0.40			$	(0.88	)		$	1.39

Inventories

9 Months Ended

Sep. 30, 2020

Inventory Disclosure [Abstract]

8. Inventories

Inventories at September 30, 2020 and December 31, 2019 consisted of the following:

		September 30, 2020				December 31, 2019
Raw materials		$	102.0			$	104.2
Work in process			23.0				22.4
Finished goods			94.2				95.9
		$	219.2			$	222.5

Goodwill and Intangible Assets

9 Months Ended

Sep. 30, 2020

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

9. Goodwill and Intangible Assets

The Company conducts an annual impairment review of goodwill and indefinite-lived intangible assets in fourth quarter of each year, unless events occur which trigger the need for an interim impairment review. The 2019 annual goodwill impairment review indicated that the JVS reporting unit’s fair value exceeded its carrying value by less than 10%. All other reporting units had fair values that exceeded their carrying value by 10% or more.

During the first quarter of 2020, the Company considered the economic impact of the COVID-19 pandemic to be a triggering event for the JVS business unit and, as a result, the Company performed an interim impairment review. As a result of both the COVID-19 related economic downturn and its impact on JVS’s anticipated financial results, the Company concluded that it was more likely than not that the JVS reporting unit’s carrying value exceeded its fair value and performed an interim impairment review for both JVS’s goodwill and tradename intangible asset. As a result of the interim impairment testing performed on March 31, 2020, the Company recorded non-cash impairment charges of $8.4 million and $139.1 million for indefinite-lived intangible assets and goodwill, respectively.

The Company estimated the fair value of the JVS reporting unit using both the discounted cash flow model and the market approach. The Company estimated the value of JVS’s indefinite-lived tradename intangible asset using a discounted cash flow model. The determination of the fair value using the discounted cash flow model requires management to make significant estimates and assumptions related to forecasts of future revenues, profit margins, and discount rates. The determination of the fair value using the market approach requires management to make significant assumptions related to earnings before interest, taxes, depreciation, and amortization (“EBITDA”) multiples. The Company estimates future cash flows based upon historical results and current market projections, discounted at a market comparable rate.

Key assumptions developed by management and used in the interim quantitative analysis included the following:

•

Near-term revenue declines in 2020;

•

Adjusted profit margins over the projection period, due to revenue adjustments and maintained investment in the business

•

Market-based discount rates; and

•

Reduced EBITDA multiple, due to current market conditions.

During the third quarter of 2020, the Company again considered the economic impact of the COVID-19 pandemic on the reporting units and determined there was no triggering event to further evaluate for potential impairment. For all reporting units, the Company concluded that it was more likely than not that their fair value continued to exceed their carrying value as of September 30, 2020. However, depending on its duration and the severity of its economic impact, the COVID-19 pandemic may trigger additional interim impairment reviews in future periods.

Changes in goodwill from January 1, 2020 through September 30, 2020 were as follows:

		Power Transmission Technologies				Automation & Specialty				Total
Net goodwill balance January 1, 2020		$	410.1			$	1,284.8			$	1,694.9
Goodwill impairment charge			—				(139.1	)			(139.1	)
Impact of changes in foreign currency			4.4				3.2				7.6
Net goodwill balance September 30, 2020		$	414.5			$	1,148.9			$	1,563.4

Other intangible assets as of September 30, 2020 and December 31, 2019 consisted of the following:

		September 30, 2020												December 31, 2019
		Cost				Accumulated Amortization				Net				Cost				Accumulated Amortization				Net
Other intangible assets
Intangible assets not subject to amortization:
Tradenames and trademarks (1)		$	254.1			$	—			$	254.1			$	260.0			$	—			$	260.0
In-process research and development			16.0				—				16.0				16.0				—				16.0
Intangible assets subject to amortization:
Customer relationships			1,197.0				176.1				1,020.9				1,187.7				137.8				1,049.9
Product technology and patents			210.5				49.6				160.9				210.0				33.5				176.5
Total intangible assets		$	1,677.6			$	225.7			$	1,451.9			$	1,673.7			$	171.3			$	1,502.4

(1)	The change in Cost of Tradenames and trademarks is a result of the $8.4 million impairment charge in the quarter-end March 31, 2020 related to the JVS reporting unit.

The Company recorded $17.5 million and $17.6 million of amortization expense in the quarters ended September 30, 2020 and 2019, respectively; and, recorded $52.3 million and $52.9 million of amortization expense in the year to date periods ended September 30, 2020 and 2019, respectively.

The estimated amortization expense for intangible assets is approximately $18.4 million for the remainder of 2020, $70.7 million in each of the next four years and then $880.6 million thereafter.

Warranty Costs

9 Months Ended

Sep. 30, 2020

Guarantees [Abstract]

10. Warranty Costs

The contractual warranty period of the Company's products generally ranges from three months to two years with certain warranties extending for longer periods. Estimated expenses related to product warranties are accrued at the time products are sold to customers and are recorded in accruals and other current liabilities on the unaudited condensed consolidated balance sheets. Estimates are established using historical information as to the nature, frequency and average costs of warranty claims.

Changes in the carrying amount of accrued product warranty costs for each of the quarters ended September 30, 2020 and 2019 are as follows:

		September 30, 2020				September 30, 2019
Balance at beginning of period		$	10.0			$	9.4
Accrued current period warranty expense			2.7				2.7
Payments and adjustments			(2.9	)			(2.7	)
Balance at end of period		$	9.8			$	9.4

Debt

9 Months Ended

Sep. 30, 2020

Debt Disclosure [Abstract]

11. Debt

Outstanding debt obligations at September 30, 2020 and December 31, 2019 were as follows.

		September 30, 2020				December 31, 2019
Debt:
Term loan		$	1,100.0			$	1,190.0
Revolving Credit Facility			—				—
Notes			400.0				400.0
Mortgages and other			12.4				13.5
Finance leases			0.3				0.5
Total gross debt			1,512.7				1,604.0
Less: debt discount and deferred financing costs			(19.3	)			(22.2	)
Total debt, net of debt discount and deferred financing costs			1,493.4				1,581.8
Less: current portion of long-term debt			(16.5	)			(18.0	)
Total long-term debt, net of unaccreted discount		$	1,476.9			$	1,563.8

2018 Credit Agreement and Notes

On October 1, 2018 (the “A&S Closing Date”), upon the closing of the combination (the “Fortive Transaction”) of Altra with four operating companies from Fortive Corporation’s (“Fortive”) Automation & Specialty platform (the “A&S Business”), the Company assumed $400 million aggregate principal amount of 6.125% senior notes due 2026 (the “Notes”). The Notes will mature on October 1, 2026. Interest on the Notes accrues from October 1, 2018, and the first interest payment date on the Notes was on April 1, 2019. The Notes may be redeemed at the option of the issuer on or after October 1, 2023. The Notes are guaranteed on a senior unsecured basis by the Company and certain of its domestic subsidiaries.

On the A&S Closing Date, the Company entered into a new Credit Agreement (the “Altra Credit Agreement”). The Altra Credit Agreement provides for a seven-year senior secured term loan in an aggregate principal amount of $1,340.0 million (the “Altra Term Loan Facility”) and a five-year senior secured revolving credit facility in an aggregate committed principal amount of $300.0 million (the “Altra Revolving Credit Facility” and together with the Altra Term Loan Facility, the “Altra Credit Facilities”). The proceeds of the Altra Term Loan Facility were used to (i) consummate Fortive’s transfer of certain non-U.S assets, liabilities and entities constituting a portion of the A&S Business to certain subsidiaries of Altra, and the Altra subsidiaries’ assumption of substantially all of the liabilities associated with the transferred assets (the “Direct Sales”), (ii) repay in full and extinguish all outstanding indebtedness for borrowed money under the 2015 Credit Agreement (as defined herein) and (iii) pay certain fees, costs, and expenses in connection with the consummation of the Fortive Transaction. The proceeds of the Altra Revolving Credit Facility will be used for working capital and general corporate purposes.

The Altra Credit Facilities are guaranteed on a senior secured basis by the Company and certain of its domestic subsidiaries, subject to certain customary exceptions.

Borrowings under the Altra Term Loan Facility will bear interest at a per annum rate equal to a “Eurocurrency Rate” plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a “Base Rate” plus 1.00%, in the case of Base Rate borrowings. Borrowings under the Altra Revolving Credit Facility will initially bear interest at a per annum rate equal to a Eurocurrency Rate plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a Base Rate plus 1.00%, in the case of Base Rate borrowings, and thereafter will bear interest at a per annum rate equal to a Eurocurrency Rate or Base Rate, as applicable, plus an interest rate spread determined by reference to a pricing grid based on the Company’s senior secured net leverage ratio. In addition, the Company will be required to pay fees that will fluctuate between 0.250% per annum to 0.375% per annum on the unused amount of the Altra Revolving Credit Facility, based upon the Company’s senior secured net leverage ratio. The interest rate on the Term Loan Facility was 2.146% at September 30, 2020.

The Altra Credit Agreement contains usual and customary representations and warranties, and usual and customary affirmative and negative covenants, including limitations on liens, investments, restricted payments, additional indebtedness and asset sales and mergers. In addition, the Altra Credit Agreement requires that Altra maintain a specified maximum senior secured leverage ratio and a specified minimum interest coverage ratio. The obligations of the borrowers of the Altra Credit Facilities under the Altra Credit Agreement may be accelerated upon customary events of default, including non-payment of principal, interest, fees and other amounts, inaccuracy of representation and warranties, violation of covenants, cross default and cross acceleration, voluntary and involuntary bankruptcy or insolvency proceedings, inability to pay debts as they become due, material judgments, ERISA events, actual or asserted invalidity of security documents or guarantees and change in control.

The Company incurred $29.9 million in issuance costs, which are amortized over the term of the debt as an adjustment to the effective interest rate on the outstanding borrowings.

The Company provided notice to the administrative agent of the Altra Credit Agreement on March 9, 2020 and March 16, 2020 to draw down $50 million and $50 million, respectively, under the Altra Revolving Credit Facility. At that time, the Company had increased its borrowings under the Altra Revolving Credit Facility as a precautionary action in order to increase its cash position and enhance its financial flexibility during this period of uncertainty in the global markets resulting from COVID-19. On April 14, 2020, the Company provided notice to the administrative agent of the Altra Credit Agreement to repay $50 million outstanding under the Altra Revolving Credit Facility. On April 27, 2020 and May 27, 2020 the Company provided notice to the administrative agent to repay $15 million and $35 million, respectively, which were outstanding under the Altra Revolving Credit Facility. As of the period ended September 30, 2020, all outstanding borrowings under the Altra Revolving Credit Facility have been repaid.

As of September 30, 2020, the Company had $1,100.0 million outstanding on the Altra Credit Agreement. As of September 30, 2020 and December 31, 2019, the Company had $5.2 million and $4.4 million in letters of credit outstanding, respectively. The Company had $294.8 million available to borrow under the Altra Credit Facilities at September 30, 2020.

Mortgages and Other Agreements

The Company’s subsidiaries in Europe have entered into certain long-term fixed rate term loans that are generally secured by local property, plant and equipment. The debt has interest rates that range from 1.79% to 2.5%, with various quarterly and monthly installments through 2028.

Financing Leases

The Company leases certain equipment under finance lease arrangements, whose obligations are included in both short-term and long-term debt. Finance lease obligations amounted to approximately $0.3 million and $0.5 million at September 30, 2020 and December 31, 2019, respectively. Finance lease right of use assets are included in property, plant and equipment with the related amortization recorded as depreciation expense.

Stockholders' Equity

9 Months Ended

Sep. 30, 2020

Stockholders Equity Note [Abstract]

Stockholders' Equity

12. Stockholders’ Equity

Common Stock

Effective October 1, 2018, the Company amended its Articles of Incorporation to increase the number of authorized shares of Altra common stock from 90.0 million shares to 120.0 million shares. As of September 30, 2020 and December 31, 2019, there were 64,665,347 and 64,222,603 shares of common stock issued and outstanding, respectively.

Preferred Stock

On December 20, 2006, the Company amended and restated its certificate of incorporation authorizing 10.0 million shares of undesignated Preferred Stock (“Preferred Stock”). The Preferred Stock may be issued from time to time in one or more classes or series, the shares of each class or series to have such designations and powers, preferences, rights, qualifications, limitations and restrictions as determined by the Company’s Board of Directors. There was no Preferred Stock issued or outstanding at September 30, 2020 or December 31, 2019.

Restricted Common Stock

The 2014 Omnibus Incentive Plan (the “2014 Plan”) was approved by the Company’s stockholders at the Company’s 2014 Annual Meeting of Stockholders. The 2014 Plan provides for various forms of stock-based compensation to our directors, executive personnel and other key employees and consultants. Under the 2014 Plan, the remaining total number of shares of common stock available for delivery pursuant to the grant of awards (“Awards”) was 4.4 million as of September 30, 2020.

The restricted shares and restricted stock units issued pursuant to the 2014 Plan generally vest ratably over a period ranging from immediately to five years from the date of grant, provided, that the vesting of the restricted shares or restricted stock units may accelerate upon the occurrence of certain events. Common stock awarded under the 2014 Plan is generally subject to restrictions on transfer, repurchase rights, and other limitations and rights as set forth in the applicable award agreements. The fair value of the shares repurchased are measured based on the share price on the date of grant.

The 2014 Plan permits the Company to grant, among other things, restricted stock, restricted stock units, stock options and performance share awards to key employees. Certain awards include vesting based upon achievement of specified performance criteria. Compensation expense recorded (in selling, general and administrative expense) during the quarters ended September 30, 2020 and 2019 was $3.2 million and $3.2 million, respectively. Compensation expense recorded (in selling, general and administrative expense) during the year to date period ended September 30, 2020 and 2019 was $10.3 million and $10.1 million, respectively. The Company recognizes stock-based compensation expense on a straight-line basis for the shares vesting ratably under the plan and uses the graded-vesting method of recognizing stock-based compensation expense for the performance share awards based on the probability of the specific performance metrics being achieved over the requisite service period.

The following tables set forth the activity of the Company’s restricted stock grants and stock options to date (amounts in thousands):

		Shares				Weighted- average fair value
Shares unvested January 1, 2020			786.3			$	35.69
Shares granted			329.2				35.55
Shares for which restrictions lapsed			(331.1	)			37.26
Shares unvested September 30, 2020			784.4			$	34.62

		Shares				Weighted- average fair value
Options unvested January 1, 2020			271.7			$	30.65
Options granted			214.5				34.78
Options exercised			(2.0	)			30.65
Options forfeited			(16.4	)			32.81
Options outstanding September 30, 2020			467.8			$	32.47
Quantity ending exercisable balance			168.7			$	31.78

Total remaining unrecognized compensation cost is approximately $21.7 million as of September 30, 2020, and will be recognized over a weighted average remaining period of three years. The intrinsic value of these awards, as of September 30, 2020, was $31.1 million. Grant date fair value is based on the quoted price of the stock on the date of grant.

Restructuring Costs

9 Months Ended

Sep. 30, 2020

Restructuring And Related Activities [Abstract]

Restructuring Costs

13. Restructuring Costs

From time to time, the Company has initiated various restructuring programs and incurred severance and other restructuring costs.

During 2017, the Company commenced a restructuring plan (“2017 Altra Plan”) as a result of the Company’s purchase of Stromag and to rationalize its global renewable energy business. The actions taken pursuant to the 2017 Altra Plan included reducing headcount, facility consolidations and the elimination of certain costs. The expenses for the year to date period ended September 30, 2020 were approximately $0.5 million and were composed of severance and other restructuring costs. The Company does not expect to incur any additional material costs as a result of the 2017 Altra Plan.

During 2019, the Company commenced a restructuring plan (“2019 Altra Plan”) to drive efficiencies, reduce the number of facilities and optimize its operating margin. The Company expects to incur approximately $5 - $10 million in restructuring expenses under the 2019 Altra Plan over the next three years, primarily related to headcount reductions and plant consolidations. The expenses for the quarter and year to date period ended September 30, 2020 were $2.4 million and $5.0 million, respectively, and were composed of severance and consolidation costs.

The following is a reconciliation of the accrued restructuring costs between January 1, 2020 and September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Balance at January 1, 2020		$	1.5			$	2.6			$	4.1
Restructuring expense incurred			0.2				1.4				1.6
Cash payments			(0.4	)			(1.4	)			(1.8	)
Balance at March 31, 2020			1.3				2.6				3.9
Restructuring expense incurred			0.3				1.2				1.5
Cash payments			(0.6	)			(1.1	)			(1.7	)
Balance at June 30, 2020			1.0				2.7				3.7
Restructuring expense incurred			—				2.4				2.4
Cash payments			(0.2	)			(2.9	)			(3.1	)
Balance at September 30, 2020		$	0.8			$	2.2			$	3.0

The following is a reconcilation of the accrued restructuring costs between January 1, 2019 and September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Balance at January 1, 2019		$	2.0			$	—			$	2.0
Restructuring expense incurred			1.0				1.3				2.3
Cash payments			(1.5	)			(0.5	)			(2.0	)
Balance at March 31, 2019			1.5				0.8				2.3
Restructuring expense incurred			1.8				1.4				3.2
Cash payments			(2.0	)			(0.7	)			(2.7	)
Balance at June 30, 2019			1.3				1.5				2.8
Restructuring expense incurred			2.3				3.9				6.2
Cash payments			(1.3	)			(1.7	)			(3.0	)
Balance at September 30, 2019		$	2.3			$	3.7			$	6.0

The following is a reconciliation of restructuring expense by segment for the quarter to date ended September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	—			$	2.0			$	2.0
Automation & Specialty			—				0.4				0.4
Total restructuring expense		$	—			$	2.4			$	2.4

The following is a reconciliation of restructuring expense by segment for the quarter to date ended September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	2.3			$	0.6			$	2.9
Automation & Specialty			—				3.3				3.3
Total restructuring expense		$	2.3			$	3.9			$	6.2

The following is a reconciliation of restructuring expense by segment for the year to date period ended September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	0.5			$	2.6			$	3.1
Automation & Specialty			—				2.4				2.4
Total restructuring expense		$	0.5			$	5.0			$	5.5

The following is a reconciliation of restructuring expense by segment for the year to date period ended September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	5.1			$	0.7			$	5.8
Automation & Specialty			—				5.9				5.9
Total restructuring expense		$	5.1			$	6.6			$	11.7

The total accrued restructuring reserve as of September 30, 2020, and as of September 30, 2019 relate primarily to severance and consolidation costs under the 2017 Altra Plan and the 2019 Altra Plan and are recorded in accruals and other liabilities on the accompanying unaudited condensed consolidated balance sheet.

Segments, Concentrations and Geographic Information

9 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Segments, Concentrations and Geographic Information

14. Segments, Concentrations and Geographic Information

Segments

The internal reporting structure used by our Chief Operating Decision Maker (“CODM”) to assess performance and allocate resources determines the basis for our reportable operating segments. Our CODM is our Chief Executive Officer, and he evaluates operations and allocates resources based on a measure of income from operations. Our operations are organized in two reporting segments that are aligned with key product types and end markets served, Power Transmission Technologies (“PTT”) and Automation & Specialty (“A&S”):

•

Power Transmission Technologies - PTT. This segment includes the following key product offerings:

o

Couplings, Clutches & Brakes. Couplings are the interface between two shafts, which enable power to be transmitted from one shaft to the other. Clutches in this segment are devices that use mechanical, hydraulic, pneumatic, or friction type connections to facilitate engaging or disengaging two rotating members. Brakes are combinations of interacting parts that work to slow or stop machinery. Products in this segment are generally used in heavy industrial applications and energy markets.

o

Electromagnetic Clutches & Brakes. Products in this segment include brakes and clutches that are used to electronically slow, stop, engage or disengage equipment utilizing electromagnetic friction type connections. Products in this segment are used in industrial and commercial markets including agricultural machinery, material handling, motion control, and turf & garden.

o

Gearing. Gears are utilized to reduce the speed and increase the torque of an electric motor or engine to the level required to drive a particular piece of equipment. Gears produced by the Company are primarily utilized in industrial applications.

•

Automation & Specialty – A&S. This segment includes the following key brands:

o

Kollmorgen: Provides rotary precision motion solutions, including servo motors, stepper motors, high performance electronic drives and motion controllers and related software, and precision linear actuators. These products are used in advanced material handling, aerospace and defense, factory automation, medical, packaging, printing, semiconductor, robotic and other applications.

o

Portescap: Provides high-efficiency miniature motors and motion control products, including brush and brushless DC motors, can stack motors and disc magnet motors. These products are used in medical, industrial power tool and general industrial equipment applications.

o

Thomson: Provides systems that enable and support the transition of rotary motion to linear motion. Products include linear bearings, guides, glides, lead and ball screws, industrial linear actuators, clutch brakes, precision gears, resolvers and inductors. These products are used in factory automation, medical, mobile off-highway, material handling, food processing and other niche applications.

o

Jacobs Vehicle Systems (JVS): Provides heavy-duty diesel engine brake systems and valve actuation mechanisms for the commercial vehicle market, including compression release, bleeder and exhaust brakes, including the “Jake Brake” engine braking system. These products are primarily used in heavy duty Class 8 truck applications.

Segment financial information and a reconciliation of segment results to unaudited condensed consolidated results are as follows:

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net Sales:
Power Transmission Technologies		$	197.7			$	218.7			$	610.7			$	688.6
Automation & Specialty			240.8				224.8				665.2				707.2
Inter-segment eliminations			(0.7	)			(0.6	)			(3.1	)			(3.6	)
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2
Income/(loss) from operations:
Segment earnings:
Power Transmission Technologies		$	23.5			$	26.3			$	73.0			$	87.1
Automation & Specialty			44.6				29.7				(48.0	)			102.1
Corporate expenses (1)			(0.3	)			(1.3	)			—				(5.5	)
Restructuring costs			(2.4	)			(6.2	)			(5.5	)			(11.7	)
Income/(loss) from operations		$	65.4			$	48.5			$	19.5			$	172.0
Other non-operating expense:
Net interest expense			18.0				18.2				54.2				56.6
Other non-operating expense, net			(0.3	)			(0.4	)			0.8				1.1
Total non-operating expense		$	17.7			$	17.8			$	55.0			$	57.7
Income/(loss) before income taxes			47.7				30.7				(35.5	)			114.3
Provision for income taxes			9.4				5.0				21.2				24.4
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9

(1)

Certain expenses are maintained at the corporate level and are not allocated to the segments. These include various administrative expenses related to the Company’s corporate headquarters, certain U.S. healthcare costs and credits, depreciation on capitalized software costs, non-capitalizable software implementation costs and acquisition related expenses.

Selected information by segment (continued)

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Depreciation and amortization:
Power Transmission Technologies		$	8.2			$	8.3			$	24.6			$	25.0
Automation & Specialty			23.3				23.2				69.4				69.4
Corporate			0.9				0.6				2.5				2.0
Total depreciation and amortization		$	32.4			$	32.1			$	96.5			$	96.4

										September 30, 2020				September 30, 2019
Total assets:
Power Transmission Technologies										$	1,054.2			$	1,064.7
Automation & Specialty											2,956.0				3,085.6
Corporate(2)											135.7				143.4
Total assets										$	4,145.9			$	4,293.7

(2)	Corporate assets are primarily cash and cash equivalents, tax related asset accounts, certain capitalized software costs, and property, plant and equipment.

Net sales to third parties by geographic region are as follows:

		Net Sales
		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
North America (primarily U.S.)		$	230.2			$	251.5			$	681.3			$	794.3
Europe excluding Germany			68.8				72.1				214.9				233.8
Germany			44.1				54.9				140.7				173.9
China			56.5				35.1				150.1				105.8
Asia and other (excluding China)			38.2				29.3				85.8				84.4
Total		$	437.8			$	442.9			$	1,272.8			$	1,392.2

Net sales to third parties are attributed to the geographic regions based on the country in which the shipment originates. Amounts attributed to the geographic regions for property, plant and equipment are based on the location of the entity, which holds such assets.

Derivative Financial Instruments

9 Months Ended

Sep. 30, 2020

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

15. Derivative Financial Instruments

The Company may manage changes in market conditions related to interest on debt obligations and foreign currency exposures by entering into derivative instruments, including interest rate and foreign currency swap agreements. All derivative instruments are recognized as either assets or liabilities on the balance sheet at fair value at the end of each period. The Company determines the fair value of financial instruments using quoted market prices whenever available. When quoted market prices are not available for various types of financial instruments (such as forwards, options and swaps), the Company uses standard models with market-based inputs, which take into account the present value of estimated future cash flows and the ability of Altra or the financial counterparty to perform. For interest rate swaps, the significant inputs to these models are interest rate curves for discounting future cash flows that are adjusted for credit risk. For forward foreign currency contracts, the significant inputs are interest rate curves for discounting future cash flows, and exchange rate curves of the foreign currency for translating future cash flows. For designated hedging relationships, the Company formally documents the hedging relationship consistent with the requirements of ASC 815, Derivatives.

Cross Currency Interest Rate Swaps

In December 2018, the Company entered into cross-currency swap agreements to hedge its net investment in Euro-denominated assets against future volatility in the exchange rate between the U.S. dollar and the Euro. By doing so, the Company synthetically converted a portion of its U.S. dollar-based long-term debt into Euro-denominated long-term debt. The agreements originally had a five-year maturity at notional amounts declining from $600.0 million to $360.0 million over the contract period. The terms of the swap agreements provided for the Company to receive net interest payments at a fixed rate of 4.8255% and pay Euros at rates ranging from 2.19% to 2.315%. At inception, the cross-currency swaps were designated as net investment hedges.

For net investment hedges, changes in the fair value of the effective portion of the derivatives’ gains or losses are reported as foreign currency translation gains or losses in accumulated other comprehensive income (loss) (“AOCIL”). The gains or losses on the net investment hedges reported in AOCIL are reclassified to earnings in the period in which earnings are affected by the underlying item, such as a disposal or substantial liquidations of the entities being hedged.

During the first quarter of 2020, the global economy declined substantially due to the impact of COVID-19. This decline resulted in a significant increase in the value of the U.S. dollar. The appreciation of the U.S. dollar resulted in the Company’s cross currency interest rate swaps being substantially in-the-money. Given the increased cash value of the hedges and the Company’s overall desire to strengthen its cash position, the Company terminated the cross-currency interest rate swaps during the first quarter of 2020. The Company received the cash value of the cross-currency interest rate swaps of approximately $56.2 million upon termination. In addition, the Company paid the interest owed and received the interest due, resulting in the recognition of approximately $3.3 million in net interest income, and paid termination fees of approximately $0.9 million. Through the date of the termination of the cross-currency interest rate swaps, the Company recorded a gain in AOCIL of approximately $31.3 million, net of $9.9 million of tax, compared to $19.8 million, net of $3.6 million of tax, during the year to date period ended September 30, 2020, and year to date period ended December 31, 2019, respectively.


		September 30, 2020				December 31, 2019
Description (in millions)		Gain/(Loss) Recognized in AOCI
Cross currency swap agreements, net of tax		$	31.3			$	19.8

Interest Rate Swaps

In January 2017, the Company entered into an interest rate swap agreement to fix the variable interest rate payable on a portion of its outstanding borrowings. This interest rate swap matured on January 31, 2020.

In December 2018, the Company entered into an interest rate swap agreement to manage the cash flow risk caused by interest rate changes on the forecasted interest payments expected to occur related to a portion of its outstanding borrowings under the Altra Credit Agreement for a notional value of $600 million at 4.8255%.

The interest rate swap agreement was designed to manage exposure to interest rates on the Company’s variable rate indebtedness and was recognized on the balance sheet at fair value. The Company designated this interest rate swap agreement as a cash flow hedge and changes in the fair value of the swap were recognized in other comprehensive income until the hedged items were recognized in earnings.

During the second quarter of 2020, the Company terminated the interest rate swap agreement. The Company paid the cash value of the interest rate swaps of approximately $34.7 million upon termination. In addition, the Company paid the interest owed and received the interest due, resulting in the recognition of approximately $0.1 million in net interest expense, and paid termination fees of approximately $0.1 million. Through the date of the termination of the interest rate swap, the Company recorded a loss in AOCIL of approximately $11.9 million, net of $3.8 million of tax benefit, compared to $9.8 million, net of $1.7 million of tax benefit, during the year to date period ended September 30, 2020, and year to date period ended December 31, 2019, respectively. The loss on the interest rate swap reported in AOCIL will be reclassified to earnings in future periods when the hedged transaction affects earnings or if it is determined that it is probable that the hedged transaction will not occur. The Company reclassified approximately $3.4 million and $0.9 million of AOCIL into interest expense for the quarters ended September 30, 2020 and September 30, 2019, respectively. The Company reclassified $8.2 million and $1.9 million of AOCIL into interest expense for the year to date periods ended September 30, 2020 and September 30, 2019, respectively. Approximately $3.4 million and $5.6 million of the AOCIL reclassified to interest expense for the quarter and year to date period ended September 30, 2020, respectively, represents non-cash amortization due to the termination of the interest rate swap.

The following table summarizes the location and fair value, using Level 2 inputs (see Note 6 for a description of the fair value levels), of the Company's derivatives designated and not designated as hedging instruments in the unaudited condensed consolidated balance sheets (in millions).


		Balance Sheet Location		September 30, 2020				December 31, 2019
Designated as hedging instruments:
Cross currency swap agreements		Other long-term (assets)		$	—			$	(15.0	)
Interest rate swap agreement		Other long-term (assets)			—				(0.0	)
Interest rate swap agreement		Other long-term liabilities			—				19.0
				$	—			$	4.0

Commitments and Contingencies

9 Months Ended

Sep. 30, 2020

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

16. Commitments and Contingencies

General Litigation

The Company is involved in various pending legal proceedings arising out of the ordinary course of business. These proceedings primarily involve commercial claims, product liability claims, personal injury claims, and workers’ compensation claims. With respect to these proceedings, management believes that the Company will prevail, has adequate insurance coverage or has established appropriate reserves to cover potential liabilities. Any costs that management estimates may be paid related to these proceedings or claims are accrued when the liability is considered probable and the amount can be reasonably estimated. There can be no assurance, however, as to the ultimate outcome of any of these matters, and if all or substantially all of these legal proceedings were to be determined adversely to the Company, there could be a material adverse effect on the results of operations, cash flows, or financial condition of the Company. We have established loss provisions for matters in which losses are probable and can be reasonably estimated. For matters where a reserve has not been established and for which we believe a loss is reasonably possible, as well as for matters where a reserve has been recorded but for which an exposure to loss in excess of the amount accrued is reasonably possible, we believe that such losses, individually and in the aggregate, will not have a material effect on our unaudited condensed consolidated financial statements.

Our estimates regarding potential losses and materiality are based on our judgment and assessment of the claims utilizing currently available information. Although we will continue to reassess our reserves and estimates based on future developments, our objective assessment of the legal merits of such claims may not always be predictive of the outcome and actual results may vary from our current estimates. We will continue to consider the applicable guidance in ASC 450-20, based on the facts known at the time of our future filings, as it relates to legal contingencies, and will adjust our disclosures as may be required under the guidance.

There were no material amounts accrued in the accompanying unaudited condensed consolidated balance sheets for potential litigation as of September 30, 2020 or December 31, 2019.

The Company also risks exposure to product liability claims in connection with products it has sold and those sold by businesses that the Company acquired. Although in some cases third parties have retained responsibility for product liability claims relating to products manufactured or sold prior to the acquisition of the relevant business and in other cases the persons from whom the Company has acquired a business may be required to indemnify the Company for certain product liability claims subject to certain caps or limitations on indemnification, the Company cannot assure that those third parties will in fact satisfy their obligations with respect to liabilities retained by them or their indemnification obligations. If those third parties become unable to or otherwise do not comply with their respective obligations including indemnity obligations, or if certain product liability claims for which the Company is obligated were not retained by third parties or are not subject to these indemnities, the Company could become subject to significant liabilities or other adverse consequences. Moreover, even in cases where third parties retain responsibility for product liability claims or are required to indemnify the Company, significant claims arising from products that have been acquired could have a material adverse effect on the Company’s ability to realize the benefits from an acquisition, could result in the reduction of the value of goodwill that the Company recorded in connection with an acquisition, or could otherwise have a material adverse effect on the Company’s business, financial condition, or operations.

Environmental

There is contamination at some of the Company’s current facilities, primarily related to historical operations at those sites, for which the Company could be liable for the investigation and remediation under certain environmental laws. The potential for contamination also exists at other of the Company’s current or former sites, based on historical uses of those sites. The Company currently is not undertaking any material remediation or investigations and the costs or liability in connection with potential contamination conditions at these facilities cannot be predicted at this time because the potential existence of contamination has not been investigated or not enough is known about the environmental conditions or likely remedial requirements. Currently, other parties with contractual liability are addressing or have plans or obligations to address those contamination conditions that may pose a material risk to human health, safety or the environment. In addition, while the Company attempts to evaluate the risk of liability associated with these facilities at the time the Company acquired them, there may be environmental conditions currently unknown to the Company relating to prior, existing or future sites or operations or those of predecessor companies whose liabilities the Company may have assumed or acquired which could have a material adverse effect on the Company’s business.

The Company is being indemnified, or expects to be indemnified, by third parties subject to certain caps or limitations on the indemnification, for certain environmental costs and liabilities associated with certain owned or operated sites. Accordingly, based on the indemnification and the experience with similar sites of the environmental consultants who the Company has hired, the Company does not expect such costs and liabilities to have a material adverse effect on its business, operations or earnings. The Company cannot assure you, however, that those third parties will in fact satisfy their indemnification obligations. If those third parties become unable to, or otherwise do not, comply with their respective indemnity obligations, or if certain contamination or other liability for which the Company is obligated is not subject to these indemnities, the Company could become subject to significant liabilities.

From time to time, the Company is notified that it is a potentially responsible party and may have liability in connection with off-site disposal facilities. To date, the Company has generally resolved matters involving off-site disposal facilities for a nominal sum but there can be no assurance that the Company will be able to resolve pending or future matters in a similar fashion.

Subsequent Events

9 Months Ended

Sep. 30, 2020

Subsequent Events [Abstract]

Subsequent Events

17. Subsequent Events

On October 21, 2020 the Company declared a dividend of $0.06 per share for the quarter ended December 31, 2020 , payable on January 5, 2021 to stockholders of record as of December 18, 2020.

Basis of Presentation (Policies)

9 Months Ended

Sep. 30, 2020

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

The Company’s unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and note disclosures required by generally accepted accounting principles in the United States, or GAAP. These statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 27, 2020 (the “2019 Annual Report on Form 10-K”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary to present fairly the Company’s financial position and cash flows for the interim periods presented. The results are not necessarily indicative of future results. The Company considers events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires the use of the current expected credit loss impairment model to estimate credit losses on certain types of financial instruments, including trade receivables. The model requires an estimate of expected credit losses, measured over the contractual life of an asset, that considers information about past events, current conditions and a forecast of future economic conditions. The Company adopted the standard on January 1, 2020. The adoption of the standard did not have a material impact on our consolidated financial statements.

As a result of the adoption of ASU 2016-13, the Company has updated its significant accounting policy related to trade account receivables and allowances for credit losses as of March 31, 2020 from what was previously disclosed in our audited financial statements for the year ended December 31, 2019 as follows:

All trade account receivables are reported net of allowances for credit losses. The allowances for credit losses represent management’s best estimate of the credit losses expected from our trade account receivables over the life of the underlying assets. Assets with similar risk characteristics are pooled together for determination of their current expected credit losses. We regularly perform detailed reviews of our pooled assets to evaluate the collectability of receivables based on a combination of past, current, and future financial and qualitative factors that may affect customers’ ability to pay. In circumstances where we are aware of a specific customer’s inability to meet its financial obligations, a specific reserve is recorded against amounts due to reduce the recognized receivable to the amount reasonably expected to be collected.

In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). The amendments in ASU 2018-13 modify the disclosure requirements on fair value measurements. The Company adopted the standard on January 1, 2020. The adoption of the standard did not have a material impact on our consolidated financial statements.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”). This ASU provides relief from certain accounting consequences that could result from the global markets’ anticipated transition away from the use of the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. The relief provided by this ASU is elective and applies to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The optional amendments are effective as of March 12, 2020 through December 31, 2022. The Company is currently evaluating the effect of the adoption of this standard on the Company.

Fair Value of Financial Instruments

Fair value is determined based upon the exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, as determined by either the principal market or the most advantageous market. Inputs used in the valuation techniques to derive fair values are classified based on a three-level hierarchy, as follows:

•

Level 1- Quoted prices in active markets for identical assets or liabilities.

•

Level 2- Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets with insufficient volume or infrequent transactions (less active markets); or model-derived.

•

Level 3- Unobservable inputs to the valuation methodology that are significant to the measurement of fair value of assets or liabilities.

The Company considers all highly liquid investments purchased with a remaining maturity of three months or less to be cash equivalents and are classified as Level 1.

The Company determines the fair value of financial instruments using quoted market prices whenever available. When quoted market prices are not available for various types of financial instruments (such as forwards, options and swaps), the Company uses standard models with market-based inputs, which take into account the present value of estimated future cash flows and the ability of the Company or the financial counterparty to perform. For interest rate and cross currency swaps, the significant inputs to these models are interest rate curves for discounting future cash flows and are adjusted for credit risk. For forward foreign currency contracts, the significant inputs are interest rate curves for discounting future cash flows and exchange rate curves of the foreign currency for translating future cash flows. See additional discussion of the Company’s use of financial instruments including cross-currency swaps and interest rate swaps included in Note 15.

The carrying values of financial instruments, including cash equivalents, accounts payable, and other accrued liabilities are carried at cost, which approximates fair value. Debt under the Altra Credit Agreement (as defined herein) is comprised of the Altra Term Loan Facility and the Altra Revolving Credit Facility (both as defined herein). The carrying amount of the Altra Term Loan Facility was $1,100.0 million and the estimated fair value of the Altra Term Loan Facility was $1,071.1 million at September 30, 2020. There is currently no debt under the Altra Revolving Credit Facility. Further, the Altra Credit Agreement was negotiated in October 2018 and there have not been any significant changes in our credit rating. The carrying amount of the Notes (as defined herein) was $400 million and the estimated fair value of the Notes was $425.0 million at September 30, 2020.

Net Income Per Share

Basic earnings per share is based on the weighted average number of shares of common stock outstanding, and diluted earnings per share is based on the weighted average number of shares of common stock outstanding and all potentially dilutive common stock equivalents outstanding. Common stock equivalents are included in the per share calculations when the effect of their inclusion is dilutive.

The following is a reconciliation of basic to diluted net income per share:

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9
Shares used in net income per common share - basic			64.6				64.4				64.6				64.3
Incremental shares of unvested restricted common stock			0.3				0.2				—				0.2
Shares used in net income per common share - diluted			64.9				64.6				64.6				64.5
Shares excluded as their inclusion would be anti-dilutive			—				—				0.1				—
Earnings/(Loss) per share:
Basic net income		$	0.59			$	0.40			$	(0.88	)		$	1.40
Diluted net income		$	0.59			$	0.40			$	(0.88	)		$	1.39

Warranty Costs

The contractual warranty period of the Company's products generally ranges from three months to two years with certain warranties extending for longer periods. Estimated expenses related to product warranties are accrued at the time products are sold to customers and are recorded in accruals and other current liabilities on the unaudited condensed consolidated balance sheets. Estimates are established using historical information as to the nature, frequency and average costs of warranty claims.

Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2020

Revenue From Contract With Customer [Abstract]

Disaggregates Revenue for Each Reportable Segment and Geographic Region

The following table disaggregates our revenue for each reportable segment. The Company believes that disaggregating revenue into these categories achieves the disclosure objective to depict how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors.

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net Sales:
Power Transmission Technologies		$	197.7			$	218.7			$	610.7			$	688.6
Automation & Specialty			240.8				224.8				665.2				707.2
Inter-segment eliminations			(0.7	)			(0.6	)			(3.1	)			(3.6	)
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2

Net sales by geographic region based on point of shipment origin are as follows:

		Net Sales
		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
North America (primarily U.S.)		$	230.2			$	251.5			$	681.3			$	794.3
Europe excluding Germany			68.8				72.1				214.9				233.8
Germany			44.1				54.9				140.7				173.9
China			56.5				35.1				150.1				105.8
Asia and other (excluding China)			38.2				29.3				85.8				84.4
Total		$	437.8			$	442.9			$	1,272.8			$	1,392.2

Summary of Opening and Closing Balances of Contract Liability and Accounts Receivable

The opening and closing balances of the Company’s contract liability and accounts receivable as of the year to date period ended September 30, 2020 are as follows:

		Deferred Revenue (Current)				Accounts Receivable
Beginning - January 1, 2020		$	8.4			$	243.2
Closing - September 30, 2020			11.2				237.0
Increase/(Decrease)		$	2.8			$	(6.2	)

		Deferred Revenue (Current)				Accounts Receivable
Beginning - January 1, 2019		$	7.4			$	259.8
Closing - September 30, 2019			10.6				244.3
Increase/(Decrease)		$	3.2			$	(15.5	)

Changes in Accumulated Other Comprehensive Income/(Loss) by Component (Tables)

9 Months Ended

Sep. 30, 2020

Equity [Abstract]

Reconciliation of Changes in Accumulated Other Comprehensive Income/(Loss) by Component

The following is a reconciliation of changes in accumulated other comprehensive income/(loss) by component for the periods presented:

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, June 30, 2020		$	18.0			$	(1.6	)		$	(116.5	)		$	(100.1	)
Other Comprehensive Income (Loss) before reclassification			—				0.2				47.6				47.8
Reclassification out of Other Comprehensive Income (Loss)			2.6				—				—				2.6
Net current-period Other Comprehensive Income (Loss)			2.6				0.2				47.6				50.4
Accumulated Other Comprehensive (Loss) by Component, September 30, 2020		$	20.6			$	(1.4	)		$	(68.9	)		$	(49.7	)

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, January 1, 2020		$	(3.0	)		$	(1.5	)		$	(85.4	)		$	(89.9	)
Other Comprehensive Income (Loss) before reclassification			19.9				0.1				16.5				36.5
Reclassification out of Other Comprehensive Income (Loss)			3.7				—				—				3.7
Net current-period Other Comprehensive Income (Loss)			23.6				0.1				16.5				40.2
Accumulated Other Comprehensive (Loss) by Component, September 30, 2020		$	20.6			$	(1.4	)		$	(68.9	)		$	(49.7	)

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, June 30, 2019		$	(15.4	)		$	(0.5	)		$	(66.1	)		$	(82.0	)
Other Comprehensive Income (Loss) before reclassfication			27.9				—				(58.7	)			(30.8	)
Reclassification out of Other Comprehensive Income (Loss)			(2.4	)			—				—				(2.4	)
Net current-period Other Comprehensive Income (Loss)			25.5				—				(58.7	)			(33.2	)
Accumulated Other Comprehensive (Loss) by Component, September 30, 2019		$	10.1			$	(0.5	)		$	(124.8	)		$	(115.2	)

		Gains and (Losses) on Cash Flow Hedges				Defined Benefit Pension Plans				Cumulative Foreign Currency Translation Adjustment				Total
Accumulated Other Comprehensive (Loss) by Component, January 1, 2019		$	(12.9	)		$	(0.2	)		$	(58.5	)		$	(71.6	)
Other Comprehensive Income (Loss) before reclassfication			30.4				(0.3	)			(66.3	)			(36.2	)
Reclassification out of Other Comprehensive Income (Loss)			(7.4	)			—				—				(7.4	)
Net current-period Other Comprehensive Income (Loss)			23.0				(0.3	)			(66.3	)			(43.6	)
Accumulated Other Comprehensive (Loss) by Component, September 30, 2019		$	10.1			$	(0.5	)		$	(124.8	)		$	(115.2	)

Net Income per Share (Tables)

9 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Reconciliation of Basic to Diluted Net Income per Share

The following is a reconciliation of basic to diluted net income per share:

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9
Shares used in net income per common share - basic			64.6				64.4				64.6				64.3
Incremental shares of unvested restricted common stock			0.3				0.2				—				0.2
Shares used in net income per common share - diluted			64.9				64.6				64.6				64.5
Shares excluded as their inclusion would be anti-dilutive			—				—				0.1				—
Earnings/(Loss) per share:
Basic net income		$	0.59			$	0.40			$	(0.88	)		$	1.40
Diluted net income		$	0.59			$	0.40			$	(0.88	)		$	1.39

Inventories (Tables)

9 Months Ended

Sep. 30, 2020

Inventory Disclosure [Abstract]

Summary of Inventories

Inventories at September 30, 2020 and December 31, 2019 consisted of the following:

		September 30, 2020				December 31, 2019
Raw materials		$	102.0			$	104.2
Work in process			23.0				22.4
Finished goods			94.2				95.9
		$	219.2			$	222.5

Goodwill and Intangible Assets (Tables)

9 Months Ended

Sep. 30, 2020

Goodwill And Intangible Assets Disclosure [Abstract]

Changes in Goodwill

Changes in goodwill from January 1, 2020 through September 30, 2020 were as follows:

		Power Transmission Technologies				Automation & Specialty				Total
Net goodwill balance January 1, 2020		$	410.1			$	1,284.8			$	1,694.9
Goodwill impairment charge			—				(139.1	)			(139.1	)
Impact of changes in foreign currency			4.4				3.2				7.6
Net goodwill balance September 30, 2020		$	414.5			$	1,148.9			$	1,563.4

Other Intangible Assets

Other intangible assets as of September 30, 2020 and December 31, 2019 consisted of the following:

		September 30, 2020												December 31, 2019
		Cost				Accumulated Amortization				Net				Cost				Accumulated Amortization				Net
Other intangible assets
Intangible assets not subject to amortization:
Tradenames and trademarks (1)		$	254.1			$	—			$	254.1			$	260.0			$	—			$	260.0
In-process research and development			16.0				—				16.0				16.0				—				16.0
Intangible assets subject to amortization:
Customer relationships			1,197.0				176.1				1,020.9				1,187.7				137.8				1,049.9
Product technology and patents			210.5				49.6				160.9				210.0				33.5				176.5
Total intangible assets		$	1,677.6			$	225.7			$	1,451.9			$	1,673.7			$	171.3			$	1,502.4

(1)	The change in Cost of Tradenames and trademarks is a result of the $8.4 million impairment charge in the quarter-end March 31, 2020 related to the JVS reporting unit.

Warranty Costs (Tables)

9 Months Ended

Sep. 30, 2020

Guarantees [Abstract]

Changes in Carrying Amount of Accrued Product Warranty Costs

Changes in the carrying amount of accrued product warranty costs for each of the quarters ended September 30, 2020 and 2019 are as follows:

		September 30, 2020				September 30, 2019
Balance at beginning of period		$	10.0			$	9.4
Accrued current period warranty expense			2.7				2.7
Payments and adjustments			(2.9	)			(2.7	)
Balance at end of period		$	9.8			$	9.4

Debt (Tables)

9 Months Ended

Sep. 30, 2020

Debt Disclosure [Abstract]

Outstanding Debt Obligations

Outstanding debt obligations at September 30, 2020 and December 31, 2019 were as follows.

		September 30, 2020				December 31, 2019
Debt:
Term loan		$	1,100.0			$	1,190.0
Revolving Credit Facility			—				—
Notes			400.0				400.0
Mortgages and other			12.4				13.5
Finance leases			0.3				0.5
Total gross debt			1,512.7				1,604.0
Less: debt discount and deferred financing costs			(19.3	)			(22.2	)
Total debt, net of debt discount and deferred financing costs			1,493.4				1,581.8
Less: current portion of long-term debt			(16.5	)			(18.0	)
Total long-term debt, net of unaccreted discount		$	1,476.9			$	1,563.8

Stockholders' Equity (Tables)

9 Months Ended

Sep. 30, 2020

Stockholders Equity Note [Abstract]

Company's Restricted Stock Grants and Stock Options

The following tables set forth the activity of the Company’s restricted stock grants and stock options to date (amounts in thousands):

		Shares				Weighted- average fair value
Shares unvested January 1, 2020			786.3			$	35.69
Shares granted			329.2				35.55
Shares for which restrictions lapsed			(331.1	)			37.26
Shares unvested September 30, 2020			784.4			$	34.62

		Shares				Weighted- average fair value
Options unvested January 1, 2020			271.7			$	30.65
Options granted			214.5				34.78
Options exercised			(2.0	)			30.65
Options forfeited			(16.4	)			32.81
Options outstanding September 30, 2020			467.8			$	32.47
Quantity ending exercisable balance			168.7			$	31.78

Restructuring Costs (Tables)

9 Months Ended

Sep. 30, 2020

Restructuring And Related Activities [Abstract]

Reconciliation of Accrued Restructuring Costs

The following is a reconciliation of the accrued restructuring costs between January 1, 2020 and September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Balance at January 1, 2020		$	1.5			$	2.6			$	4.1
Restructuring expense incurred			0.2				1.4				1.6
Cash payments			(0.4	)			(1.4	)			(1.8	)
Balance at March 31, 2020			1.3				2.6				3.9
Restructuring expense incurred			0.3				1.2				1.5
Cash payments			(0.6	)			(1.1	)			(1.7	)
Balance at June 30, 2020			1.0				2.7				3.7
Restructuring expense incurred			—				2.4				2.4
Cash payments			(0.2	)			(2.9	)			(3.1	)
Balance at September 30, 2020		$	0.8			$	2.2			$	3.0

The following is a reconcilation of the accrued restructuring costs between January 1, 2019 and September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Balance at January 1, 2019		$	2.0			$	—			$	2.0
Restructuring expense incurred			1.0				1.3				2.3
Cash payments			(1.5	)			(0.5	)			(2.0	)
Balance at March 31, 2019			1.5				0.8				2.3
Restructuring expense incurred			1.8				1.4				3.2
Cash payments			(2.0	)			(0.7	)			(2.7	)
Balance at June 30, 2019			1.3				1.5				2.8
Restructuring expense incurred			2.3				3.9				6.2
Cash payments			(1.3	)			(1.7	)			(3.0	)
Balance at September 30, 2019		$	2.3			$	3.7			$	6.0

Reconciliation of Restructuring Expense by Segment

The following is a reconciliation of restructuring expense by segment for the quarter to date ended September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	—			$	2.0			$	2.0
Automation & Specialty			—				0.4				0.4
Total restructuring expense		$	—			$	2.4			$	2.4

The following is a reconciliation of restructuring expense by segment for the quarter to date ended September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	2.3			$	0.6			$	2.9
Automation & Specialty			—				3.3				3.3
Total restructuring expense		$	2.3			$	3.9			$	6.2

The following is a reconciliation of restructuring expense by segment for the year to date period ended September 30, 2020.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	0.5			$	2.6			$	3.1
Automation & Specialty			—				2.4				2.4
Total restructuring expense		$	0.5			$	5.0			$	5.5

The following is a reconciliation of restructuring expense by segment for the year to date period ended September 30, 2019.

		2017 Altra Plan				2019 Altra Plan				Total All Plans
Power Transmission Technologies		$	5.1			$	0.7			$	5.8
Automation & Specialty			—				5.9				5.9
Total restructuring expense		$	5.1			$	6.6			$	11.7

Segments, Concentrations and Geographic Information (Tables)

9 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Segment Financial Information and Reconciliation of Segments Revenue to Unaudited Condensed Consolidated Revenue

Segment financial information and a reconciliation of segment results to unaudited condensed consolidated results are as follows:

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Net Sales:
Power Transmission Technologies		$	197.7			$	218.7			$	610.7			$	688.6
Automation & Specialty			240.8				224.8				665.2				707.2
Inter-segment eliminations			(0.7	)			(0.6	)			(3.1	)			(3.6	)
Net sales		$	437.8			$	442.9			$	1,272.8			$	1,392.2
Income/(loss) from operations:
Segment earnings:
Power Transmission Technologies		$	23.5			$	26.3			$	73.0			$	87.1
Automation & Specialty			44.6				29.7				(48.0	)			102.1
Corporate expenses (1)			(0.3	)			(1.3	)			—				(5.5	)
Restructuring costs			(2.4	)			(6.2	)			(5.5	)			(11.7	)
Income/(loss) from operations		$	65.4			$	48.5			$	19.5			$	172.0
Other non-operating expense:
Net interest expense			18.0				18.2				54.2				56.6
Other non-operating expense, net			(0.3	)			(0.4	)			0.8				1.1
Total non-operating expense		$	17.7			$	17.8			$	55.0			$	57.7
Income/(loss) before income taxes			47.7				30.7				(35.5	)			114.3
Provision for income taxes			9.4				5.0				21.2				24.4
Net income/(loss)		$	38.3			$	25.7			$	(56.7	)		$	89.9

(1)

Certain expenses are maintained at the corporate level and are not allocated to the segments. These include various administrative expenses related to the Company’s corporate headquarters, certain U.S. healthcare costs and credits, depreciation on capitalized software costs, non-capitalizable software implementation costs and acquisition related expenses.

Reconciliation of Segment Assets to Consolidated Assets

Selected information by segment (continued)

		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
Depreciation and amortization:
Power Transmission Technologies		$	8.2			$	8.3			$	24.6			$	25.0
Automation & Specialty			23.3				23.2				69.4				69.4
Corporate			0.9				0.6				2.5				2.0
Total depreciation and amortization		$	32.4			$	32.1			$	96.5			$	96.4

										September 30, 2020				September 30, 2019
Total assets:
Power Transmission Technologies										$	1,054.2			$	1,064.7
Automation & Specialty											2,956.0				3,085.6
Corporate(2)											135.7				143.4
Total assets										$	4,145.9			$	4,293.7

(2)	Corporate assets are primarily cash and cash equivalents, tax related asset accounts, certain capitalized software costs, and property, plant and equipment.

Net Sales to Third Parties by Geographic Region

Net sales to third parties by geographic region are as follows:

		Net Sales
		Quarter Ended								Year to Date Ended
		September 30, 2020				September 30, 2019				September 30, 2020				September 30, 2019
North America (primarily U.S.)		$	230.2			$	251.5			$	681.3			$	794.3
Europe excluding Germany			68.8				72.1				214.9				233.8
Germany			44.1				54.9				140.7				173.9
China			56.5				35.1				150.1				105.8
Asia and other (excluding China)			38.2				29.3				85.8				84.4
Total		$	437.8			$	442.9			$	1,272.8			$	1,392.2

Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2020

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Summary of Impact of Cross-Currency Swaps to AOCIL and Consolidated Statements of Operations


		September 30, 2020				December 31, 2019
Description (in millions)		Gain/(Loss) Recognized in AOCI
Cross currency swap agreements, net of tax		$	31.3			$	19.8

Summary of Fair Value Level 2 Inputs of Company's Derivatives

The following table summarizes the location and fair value, using Level 2 inputs (see Note 6 for a description of the fair value levels), of the Company's derivatives designated and not designated as hedging instruments in the unaudited condensed consolidated balance sheets (in millions).


		Balance Sheet Location		September 30, 2020				December 31, 2019
Designated as hedging instruments:
Cross currency swap agreements		Other long-term (assets)		$	—			$	(15.0	)
Interest rate swap agreement		Other long-term (assets)			—				(0.0	)
Interest rate swap agreement		Other long-term liabilities			—				19.0
				$	—			$	4.0

Organization and Nature of Operations - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2020 country
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Number of countries in which the company has production facilities	17

Recent Accounting Standards - Additional Information (Detail)	Sep. 30, 2020
ASU 2016-13 [Member]
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]
Change in accounting principle, accounting standards update, adoption date	Jan. 01, 2020
Change in accounting principle, accounting standards update, early adoption	false
Change in accounting principle, accounting standards update, adopted	true
Change in accounting principle, accounting standards update, immaterial effect	true
ASU 2018-13 [Member]
New Accounting Pronouncements Or Change In Accounting Principle [Line Items]
Change in accounting principle, accounting standards update, adoption date	Jan. 01, 2020
Change in accounting principle, accounting standards update, early adoption	false
Change in accounting principle, accounting standards update, adopted	true
Change in accounting principle, accounting standards update, immaterial effect	true

Revenue Recognition - Additional Information (Detail)	9 Months Ended
Revenue Recognition - Additional Information (Detail)	Sep. 30, 2020 channel
Revenue From Contract With Customer [Abstract]
Number of distribution channels	3

Revenue Recognition - Disaggregates Revenue for Each Reportable Segment and Geographic Region (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Disaggregation Of Revenue [Line Items]
Net sales	$ 437.8	$ 442.9	$ 1,272.8	$ 1,392.2
North America (primarily U.S.) [Member]
Disaggregation Of Revenue [Line Items]
Net sales	230.2	251.5	681.3	794.3
Europe Excluding Germany [Member]
Disaggregation Of Revenue [Line Items]
Net sales	68.8	72.1	214.9	233.8
Germany [Member]
Disaggregation Of Revenue [Line Items]
Net sales	44.1	54.9	140.7	173.9
China [Member]
Disaggregation Of Revenue [Line Items]
Net sales	56.5	35.1	150.1	105.8
Asia And Other (Excluding China) [Member]
Disaggregation Of Revenue [Line Items]
Net sales	38.2	29.3	85.8	84.4
Operating Segments [Member] \| Power Transmission Technologies [Member]
Disaggregation Of Revenue [Line Items]
Net sales	197.7	218.7	610.7	688.6
Operating Segments [Member] \| Automation & Specialty [Member]
Disaggregation Of Revenue [Line Items]
Net sales	240.8	224.8	665.2	707.2
Intersegment Eliminations [Member]
Disaggregation Of Revenue [Line Items]
Net sales	$ (0.7)	$ (0.6)	$ (3.1)	$ (3.6)

Revenue Recognition - Summary of Opening and Closing Balances of Contract Liability and Accounts Receivable (Detail) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Disaggregation Of Revenue [Line Items]
Accounts Receivable, Beginning Balance	$ 243.2
Accounts Receivable, Closing Balance	237.0
ASU 2014-09 [Member]
Disaggregation Of Revenue [Line Items]
Deferred Revenue (Current), Beginning Balance	8.4	$ 7.4
Deferred Revenue (Current), Closing Balance	11.2	10.6
Deferred Revenue (Current), Increase/(Decrease)	2.8	3.2
Accounts Receivable, Beginning Balance	243.2	259.8
Accounts Receivable, Closing Balance	237.0	244.3
Accounts Receivable, Increase/(Decrease)	$ (6.2)	$ (15.5)

Fair Value of Financial Instruments - Additional Information (Details) - USD ($)	Sep. 30, 2020	Dec. 31, 2019
Notes [Member]
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Debt	$ 400,000,000.0	$ 400,000,000.0
Estimated fair value	425,000,000.0
Altra Credit Agreement [Member]
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Debt	1,100,000,000.0	$ 1,190,000,000.0
Outstanding debt under credit facility	1,100,000,000.0
Altra Credit Agreement [Member] \| Altra Term Loan Facility [Member]
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Debt	1,100,000,000.0
Estimated fair value	1,071,100,000
Altra Credit Agreement [Member] \| Revolving Credit Facility [Member]
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Outstanding debt under credit facility	$ 0

Changes in Accumulated Other Comprehensive Income/(Loss) by Component - Reconciliation of Changes in Accumulated Other Comprehensive Income/(Loss) by Component (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss) by Component			$ (89.9)
Beginning balance	$ 1,808.5	$ 1,884.4	1,922.3	$ 1,848.2
Other Comprehensive Income (Loss) before reclassification	47.8	(30.8)	36.5	(36.2)
Reclassification out of Other Comprehensive Income (Loss)	2.6	(2.4)	3.7	(7.4)
Net current-period Other Comprehensive Income (Loss)	50.4	(33.2)	40.2	(43.6)
Accumulated Other Comprehensive Income (Loss) by Component	(49.7)		(49.7)
Ending balance	1,895.8	1,867.5	1,895.8	1,867.5
Gains and Losses on Cash Flow Hedges [Member]
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss) by Component	18.0	(15.4)	(3.0)	(12.9)
Other Comprehensive Income (Loss) before reclassification		27.9	19.9	30.4
Reclassification out of Other Comprehensive Income (Loss)	2.6	(2.4)	3.7	(7.4)
Net current-period Other Comprehensive Income (Loss)	2.6	25.5	23.6	23.0
Accumulated Other Comprehensive Income (Loss) by Component	20.6	10.1	20.6	10.1
Defined Benefit Pension Plans [Member]
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss) by Component	(1.6)	(0.5)	(1.5)	(0.2)
Other Comprehensive Income (Loss) before reclassification	0.2		0.1	(0.3)
Net current-period Other Comprehensive Income (Loss)	0.2		0.1	(0.3)
Accumulated Other Comprehensive Income (Loss) by Component	(1.4)	(0.5)	(1.4)	(0.5)
Cumulative Foreign Currency Translation Adjustment [Member]
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Accumulated Other Comprehensive Income (Loss) by Component	(116.5)	(66.1)	(85.4)	(58.5)
Other Comprehensive Income (Loss) before reclassification	47.6	(58.7)	16.5	(66.3)
Net current-period Other Comprehensive Income (Loss)	47.6	(58.7)	16.5	(66.3)
Accumulated Other Comprehensive Income (Loss) by Component	(68.9)	(124.8)	(68.9)	(124.8)
Accumulated Other Comprehensive Income (Loss) [Member]
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]
Beginning balance	(100.1)	(82.0)	(89.9)	(71.6)
Ending balance	$ (49.7)	$ (115.2)	$ (49.7)	$ (115.2)

Net Income per Share - Reconciliation of Basic to Diluted Net Income per Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Earnings Per Share [Abstract]
Net income (loss)	$ 38.3	$ 25.7	$ (56.7)	$ 89.9
Shares used in net income per common share - basic	64.6	64.4	64.6	64.3
Incremental shares of unvested restricted common stock	0.3	0.2		0.2
Shares used in net income per common share - diluted	64.9	64.6	64.6	64.5
Shares excluded as their inclusion would be anti-dilutive			0.1
Earnings/(Loss) per share:
Basic net income	$ 0.59	$ 0.40	$ (0.88)	$ 1.40
Diluted net income	$ 0.59	$ 0.40	$ (0.88)	$ 1.39

Inventories - Summary of Inventories (Detail) - USD ($) $ in Millions	Sep. 30, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 102.0	$ 104.2
Work in process	23.0	22.4
Finished goods	94.2	95.9
Inventories, net	$ 219.2	$ 222.5

Goodwill and Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended			9 Months Ended
	Sep. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Goodwill And Intangible Assets [Line Items]
Indefinite-lived intangible assets and goodwill Impairment charges				$ 139.1
Amortization expense	$ 17.5		$ 17.6	52.3	$ 52.9
Estimated amortization expense, remainder of 2020	18.4			18.4
Estimated amortization expense, year 2021	70.7			70.7
Estimated amortization expense, year 2022	70.7			70.7
Estimated amortization expense, year 2023	70.7			70.7
Estimated amortization expense, year 2024	70.7			70.7
Estimated amortization expense, thereafter	$ 880.6			$ 880.6
Jacobs Vehicle Systems [Member]
Goodwill And Intangible Assets [Line Items]
Reporting unit, percentage of fair value in excess of carrying amount						10.00%
Non-cash impairment charges		$ 8.4
Indefinite-lived intangible assets and goodwill Impairment charges		$ 139.1
All Other Reporting Units [Member]
Goodwill And Intangible Assets [Line Items]
Reporting unit, percentage of fair value in excess of carrying amount						10.00%

Goodwill and Intangible Assets - Changes in Goodwill (Detail) $ in Millions	9 Months Ended
	Sep. 30, 2020 USD ($)
Goodwill [Roll Forward]
Net goodwill, Beginning balance	$ 1,694.9
Goodwill impairment charge	(139.1)
Impact of changes in foreign currency	7.6
Net goodwill, ending balance	1,563.4
Power Transmission Technologies [Member]
Goodwill [Roll Forward]
Net goodwill, Beginning balance	410.1
Impact of changes in foreign currency	4.4
Net goodwill, ending balance	414.5
Automation & Specialty [Member]
Goodwill [Roll Forward]
Net goodwill, Beginning balance	1,284.8
Goodwill impairment charge	(139.1)
Impact of changes in foreign currency	3.2
Net goodwill, ending balance	$ 1,148.9

Goodwill and Intangible Assets - Other Intangible Assets (Detail) - USD ($) $ in Millions	Sep. 30, 2020	Dec. 31, 2019
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items]
Total intangible assets, accumulated amortization	$ 225.7	$ 171.3
Total intangible assets, cost	1,677.6	1,673.7
Total intangible assets, net	1,451.9	1,502.4
Customer Relationships [Member]
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items]
Intangible assets subject to amortization, cost	1,197.0	1,187.7
Total intangible assets, accumulated amortization	176.1	137.8
Intangible assets subject to amortization, net	1,020.9	1,049.9
Product Technology and Patents [Member]
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items]
Intangible assets subject to amortization, cost	210.5	210.0
Total intangible assets, accumulated amortization	49.6	33.5
Intangible assets subject to amortization, net	160.9	176.5
Tradenames and Trademarks [Member]
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items]
Intangible assets not subject to amortization, cost	254.1	260.0
In-process Research and Development [Member]
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items]
Intangible assets not subject to amortization, cost	$ 16.0	$ 16.0

Goodwill and Intangible Assets - Other Intangible Assets (Parenthetical) (Detail) $ in Millions	3 Months Ended
	Mar. 31, 2020 USD ($)
Jacobs Vehicle Systems [Member]
Schedule Of Finite And Indefinite Lived Intangible Assets [Line Items]
Non-cash impairment charges	$ 8.4

Warranty Costs - Additional Information (Detail)	9 Months Ended
Warranty Costs - Additional Information (Detail)	Sep. 30, 2020
Minimum [Member]
Guarantor Obligations [Line Items]
Product warranty period	3 months
Maximum [Member]
Guarantor Obligations [Line Items]
Product warranty period	2 years

Warranty Costs - Changes in Carrying Amount of Accrued Product Warranty Costs (Detail) - USD ($) $ in Millions	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Movement in Liabilities for Guarantees on Long-Duration Contracts, Guaranteed Benefit Liability, Gross [Roll Forward]
Balance at beginning of period	$ 10.0	$ 9.4
Accrued current period warranty expense	2.7	2.7
Payments and adjustments	(2.9)	(2.7)
Balance at end of period	$ 9.8	$ 9.4

Debt - Outstanding Debt Obligations (Detail) - USD ($) $ in Millions	Sep. 30, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Finance leases	$ 0.3	$ 0.5
Total gross debt	1,512.7	1,604.0
Less: debt discount and deferred financing costs	(19.3)	(22.2)
Total debt, net of debt discount and deferred financing costs	1,493.4	1,581.8
Less: current portion of long-term debt	(16.5)	(18.0)
Total long-term debt, net of unaccreted discount	1,476.9	1,563.8
Term Loan [Member]
Debt Instrument [Line Items]
Debt	1,100.0	1,190.0
Notes [Member]
Debt Instrument [Line Items]
Debt	400.0	400.0
Mortgages and Other [Member]
Debt Instrument [Line Items]
Debt	$ 12.4	$ 13.5

Debt - Additional Information (Detail)		9 Months Ended
Debt - Additional Information (Detail)	Oct. 01, 2018 USD ($) Company	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	May 27, 2020 USD ($)	Apr. 27, 2020 USD ($)	Apr. 14, 2020 USD ($)	Mar. 16, 2020 USD ($)	Mar. 09, 2020 USD ($)	Dec. 31, 2019 USD ($)
Debt Instrument [Line Items]
Amortization of deferred financing costs		$ 3,400,000	$ 3,800,000
Finance lease obligations		$ 300,000							$ 500,000
Mortgages and Other Agreements [Member]
Debt Instrument [Line Items]
Description about maturity date of debt instrument		The debt has interest rates that range from 1.79% to 2.5%, with various quarterly and monthly installments through 2028.
Minimum [Member] \| Mortgages and Other Agreements [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate percentage		1.79%
Maximum [Member] \| Mortgages and Other Agreements [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate percentage		2.50%
A&S Business [Member]
Debt Instrument [Line Items]
Business combination, number of operating companies in transaction \| Company	4
6.125% Senior Notes Due 2026 [Member] \| Newco [Member] \| A&S Business [Member]
Debt Instrument [Line Items]
Debt instrument, aggregate principal amount	$ 400,000,000
Debt instrument, interest rate percentage	6.125%
Debt instrument, maturity date	Oct. 01, 2026
Debt instrument, interest payment terms		Interest on the Notes accrues from October 1, 2018, and the first interest payment date on the Notes was on April 1, 2019. The Notes may be redeemed at the option of the issuer on or after October 1, 2023.
Debt instrument, first interest payment date	Apr. 01, 2019
Debt instrument, redemption, description		The Notes may be redeemed at the option of the issuer on or after October 1, 2023
Debt instrument, redemption period, start date	Oct. 01, 2023
Altra Credit Agreement [Member]
Debt Instrument [Line Items]
Amortization of deferred financing costs		$ 29,900,000
Notice provided to administrate agent of credit facility to draw amount							$ 50,000,000	$ 50,000,000
Notice provided to administrate agent of credit facility to repay outstanding amount				$ 35,000,000	$ 15,000,000	$ 50,000,000
Outstanding debt		1,100,000,000.0
Letters of credit outstanding		$ 5,200,000							$ 4,400,000
Altra Credit Agreement [Member] \| Altra Term Loan Facility [Member]
Debt Instrument [Line Items]
Debt instrument, term	7 years
Maximum amount available	$ 1,340,000,000.0
Debt instrument, description of variable rate basis		Borrowings under the Altra Term Loan Facility will bear interest at a per annum rate equal to a “Eurocurrency Rate” plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a “Base Rate” plus 1.00%, in the case of Base Rate borrowings.
Credit facility, commitment fee description		the Company will be required to pay fees that will fluctuate between 0.250% per annum to 0.375% per annum on the unused amount of the Altra Revolving Credit Facility, based upon the Company’s senior secured net leverage ratio
Line of credit facility, interest rate during period		2.146%
Altra Credit Agreement [Member] \| Altra Term Loan Facility [Member] \| Eurocurrency Rate [Member]
Debt Instrument [Line Items]
Applicable margins for loans	2.00%
Altra Credit Agreement [Member] \| Altra Term Loan Facility [Member] \| Base Rate [Member]
Debt Instrument [Line Items]
Applicable margins for loans	1.00%
Altra Credit Agreement [Member] \| Altra Term Loan Facility [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Credit facility, unused capacity, commitment fee percentage	0.25%
Altra Credit Agreement [Member] \| Altra Term Loan Facility [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Credit facility, unused capacity, commitment fee percentage	0.375%
Altra Credit Agreement [Member] \| Altra Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Debt instrument, term	5 years
Maximum amount available	$ 300,000,000.0
Debt instrument, description of variable rate basis		Borrowings under the Altra Revolving Credit Facility will initially bear interest at a per annum rate equal to a Eurocurrency Rate plus 2.00%, in the case of Eurocurrency Rate borrowings, or equal to a Base Rate plus 1.00%, in the case of Base Rate borrowings
Amount available under credit facility		$ 294,800,000
Altra Credit Agreement [Member] \| Altra Revolving Credit Facility [Member] \| Eurocurrency Rate [Member]
Debt Instrument [Line Items]
Applicable margins for loans	2.00%
Altra Credit Agreement [Member] \| Altra Revolving Credit Facility [Member] \| Base Rate [Member]
Debt Instrument [Line Items]
Applicable margins for loans	1.00%

Stockholders' Equity - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019	Oct. 01, 2018	Sep. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, shares authorized (in shares)	120,000,000		120,000,000		120,000,000	120,000,000.0	90,000,000.0
Common stock, shares issued (in shares)	64,665,347		64,665,347		64,222,603
Common stock, shares outstanding (in shares)	64,665,347		64,665,347		64,222,603
Preferred Stock, shares authorized (in shares)	10,000,000.0		10,000,000.0
Preferred Stock, shares issued (in shares)	0		0		0
Preferred Stock, shares outstanding (in shares)	0		0		0
Compensation expense	$ 3.2	$ 3.2	$ 10.3	$ 10.1
Unrecognized compensation cost	21.7		$ 21.7
Weighted average remaining period			3 years
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Intrinsic value of stock awards	$ 31.1		$ 31.1
2014 Plan [Member] \| Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares of common stock available for delivery pursuant to the grant of awards (in shares)	4,400,000		4,400,000
2014 Plan [Member] \| Restricted Shares and Restricted Stock Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted shares for vesting period			5 years

Stockholders' Equity - Company's Restricted Stock Grants and Stock Options (Detail)	9 Months Ended
	Sep. 30, 2020 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares [Roll Forward]
Options unvested, beginning balance \| shares	271,700,000
Options granted \| shares	214,500,000
Options exercised \| shares	(2,000,000.0)
Options forfeited \| shares	(16,400,000)
Options unvested, ending balance \| shares	467,800,000
Quantity ending exercisable balance \| shares	168,700,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Weighted-average grant date fair value, Options unvested, beginning balance \| $ / shares	$ 30.65
Weighted-average grant date fair value, Options granted \| $ / shares	34.78
Weighted-average grant date fair value, Options Exercised \| $ / shares	30.65
Weighted-average grant date fair value, Options forfeited \| $ / shares	32.81
Weighted-average grant date fair value, Options unvested, ending balance \| $ / shares	32.47
Weighted-average grant date fair value, Quantity ending exercisable balance \| $ / shares	$ 31.78
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Shares unvested, beginning balance \| shares	786,300,000
Shares granted \| shares	329,200,000
Shares for which restrictions lapsed \| shares	(331,100,000)
Shares unvested, ending balance \| shares	784,400,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Weighted-average grant date fair value, beginning balance \| $ / shares	$ 35.69
Weighted-average grant date fair value, shares granted \| $ / shares	35.55
Weighted-average grant date fair value, shares for which restrictions lapsed \| $ / shares	37.26
Weighted-average grant date fair value, ending balance \| $ / shares	$ 34.62

Restructuring Costs - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended						9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019
Restructuring Cost And Reserve [Line Items]
Restructuring costs	$ 2.4	$ 1.5	$ 1.6	$ 6.2	$ 3.2	$ 2.3	$ 5.5	$ 11.7
2017 Altra Plan [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring costs		0.3	0.2	2.3	1.8	1.0	0.5	5.1
2019 Altra Plan [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring costs	2.4	$ 1.2	$ 1.4	$ 3.9	$ 1.4	$ 1.3	$ 5.0	$ 6.6
Expected period to incur restructuring expense							3 years
2019 Altra Plan [Member] \| Minimum [Member]
Restructuring Cost And Reserve [Line Items]
Expected additional restructuring cost remaining	5.0						$ 5.0
2019 Altra Plan [Member] \| Maximum [Member]
Restructuring Cost And Reserve [Line Items]
Expected additional restructuring cost remaining	10.0						10.0
Employee Severance, Consolidation and Other Restructuring Costs [Member] \| 2017 Altra Plan [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring costs							0.5
Severance [Member] \| 2019 Altra Plan [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring costs	2.4						2.4
Consolidation costs [Member] \| 2019 Altra Plan [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring costs	$ 5.0						$ 5.0

Restructuring Costs - Reconciliation of Accrued Restructuring Costs (Detail) - USD ($) $ in Millions	3 Months Ended						9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019
Restructuring Reserve [Roll Forward]
Beginning Balance	$ 3.7	$ 3.9	$ 4.1	$ 2.8	$ 2.3	$ 2.0	$ 4.1	$ 2.0
Restructuring expense incurred	2.4	1.5	1.6	6.2	3.2	2.3	5.5	11.7
Cash payments	(3.1)	(1.7)	(1.8)	(3.0)	(2.7)	(2.0)
Ending Balance	3.0	3.7	3.9	6.0	2.8	2.3	3.0	6.0
2017 Altra Plan [Member]
Restructuring Reserve [Roll Forward]
Beginning Balance	1.0	1.3	1.5	1.3	1.5	2.0	1.5	2.0
Restructuring expense incurred		0.3	0.2	2.3	1.8	1.0	0.5	5.1
Cash payments	(0.2)	(0.6)	(0.4)	(1.3)	(2.0)	(1.5)
Ending Balance	0.8	1.0	1.3	2.3	1.3	1.5	0.8	2.3
2019 Altra Plan [Member]
Restructuring Reserve [Roll Forward]
Beginning Balance	2.7	2.6	2.6	1.5	0.8		2.6
Restructuring expense incurred	2.4	1.2	1.4	3.9	1.4	1.3	5.0	6.6
Cash payments	(2.9)	(1.1)	(1.4)	(1.7)	(0.7)	(0.5)
Ending Balance	$ 2.2	$ 2.7	$ 2.6	$ 3.7	$ 1.5	$ 0.8	$ 2.2	$ 3.7

Restructuring Costs - Summary of Reconciliation of Restructuring Expense by Segment (Detail) - USD ($) $ in Millions	3 Months Ended						9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Sep. 30, 2020	Sep. 30, 2019
Restructuring Cost And Reserve [Line Items]
Restructuring expense	$ 2.4	$ 1.5	$ 1.6	$ 6.2	$ 3.2	$ 2.3	$ 5.5	$ 11.7
2017 Altra Plan [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring expense		0.3	0.2	2.3	1.8	1.0	0.5	5.1
2019 Altra Plan [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring expense	2.4	$ 1.2	$ 1.4	3.9	$ 1.4	$ 1.3	5.0	6.6
Operating Segments [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring expense	2.4			6.2			5.5	11.7
Operating Segments [Member] \| Power Transmission Technologies [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring expense	2.0			2.9			3.1	5.8
Operating Segments [Member] \| Automation & Specialty [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring expense	0.4			3.3			2.4	5.9
Operating Segments [Member] \| 2017 Altra Plan [Member] \| Power Transmission Technologies [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring expense				2.3			0.5	5.1
Operating Segments [Member] \| 2019 Altra Plan [Member] \| Power Transmission Technologies [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring expense	2.0			0.6			2.6	0.7
Operating Segments [Member] \| 2019 Altra Plan [Member] \| Automation & Specialty [Member]
Restructuring Cost And Reserve [Line Items]
Restructuring expense	$ 0.4			$ 3.3			$ 2.4	$ 5.9

Segments, Concentrations and Geographic Information - Additional Information (Detail)	9 Months Ended
	Sep. 30, 2020 segment
Segment Reporting [Abstract]
Number of reporting segments	2

Segments, Concentrations and Geographic Information - Segment Financial Information and Reconciliation of Segments Revenue to Unaudited Condensed Consolidated Revenue (Detail) - USD ($)
$ in Millions

3 Months Ended

9 Months Ended

Sep. 30, 2020

Jun. 30, 2020

Mar. 31, 2020

Sep. 30, 2019

Jun. 30, 2019

Mar. 31, 2019

Sep. 30, 2020

Sep. 30, 2019

Revenues from External Customers and Long-Lived Assets [Line Items]

$ 437.8

$ 442.9

$ 1,272.8

$ 1,392.2

Income/(loss) from operations

65.4

48.5

19.5

172.0

Restructuring costs

(2.4)

$ (1.5)

$ (1.6)

(6.2)

$ (3.2)

$ (2.3)

(5.5)

(11.7)

Net interest expense

18.0

18.2

54.2

56.6

Other non-operating expense, net

(0.3)

(0.4)

0.8

1.1

Total other non-operating (income) expense, net

17.7

17.8

55.0

57.7

Income/(Loss) before income taxes

47.7

30.7

(35.5)

114.3

Provision for income taxes

9.4

5.0

21.2

24.4

Net income/(loss)

38.3

25.7

(56.7)

89.9

Operating Segments [Member]

Revenues from External Customers and Long-Lived Assets [Line Items]

Restructuring costs

(2.4)

(6.2)

(5.5)

(11.7)

Operating Segments [Member] | Power Transmission Technologies [Member]

Revenues from External Customers and Long-Lived Assets [Line Items]

197.7

218.7

610.7

688.6

Income/(loss) from operations

23.5

26.3

73.0

87.1

Restructuring costs

(2.0)

(2.9)

(3.1)

(5.8)

Operating Segments [Member] | Automation & Specialty [Member]

Revenues from External Customers and Long-Lived Assets [Line Items]

240.8

224.8

665.2

707.2

Income/(loss) from operations

44.6

29.7

(48.0)

102.1

Restructuring costs

(0.4)

(3.3)

(2.4)

(5.9)

Intersegment Eliminations [Member]

Revenues from External Customers and Long-Lived Assets [Line Items]

(0.7)

(0.6)

$ (3.1)

(3.6)

Corporate [Member]

Revenues from External Customers and Long-Lived Assets [Line Items]

Income/(loss) from operations

^[1]

$ (0.3)

$ (1.3)

$ (5.5)

[1]

Certain expenses are maintained at the corporate level and are not allocated to the segments. These include various administrative expenses related to the Company’s corporate headquarters, certain U.S. healthcare costs and credits, depreciation on capitalized software costs, non-capitalizable software implementation costs and acquisition related expenses.

Segments, Concentrations and Geographic Information - Reconciliation of Segment Assets to Consolidated Assets (Detail) - USD ($)
$ in Millions

3 Months Ended

9 Months Ended

Sep. 30, 2020

Sep. 30, 2019

Sep. 30, 2020

Sep. 30, 2019

Dec. 31, 2019

Revenues from External Customers and Long-Lived Assets [Line Items]

Total depreciation and amortization

$ 32.4

$ 32.1

$ 96.5

$ 96.4

4,145.9

4,293.7

4,145.9

4,293.7

$ 4,283.7

Corporate [Member]

Revenues from External Customers and Long-Lived Assets [Line Items]

Total depreciation and amortization

0.9

0.6

2.5

2.0

^[1]

135.7

143.4

135.7

143.4

Power Transmission Technologies [Member] | Operating Segments [Member]

Revenues from External Customers and Long-Lived Assets [Line Items]

Total depreciation and amortization

8.2

8.3

24.6

25.0

1,054.2

1,064.7

1,054.2

1,064.7

Automation & Specialty [Member] | Operating Segments [Member]

Revenues from External Customers and Long-Lived Assets [Line Items]

Total depreciation and amortization

23.3

23.2

69.4

69.4

$ 2,956.0

$ 3,085.6

$ 2,956.0

$ 3,085.6

[1]	Corporate assets are primarily cash and cash equivalents, tax related asset accounts, certain capitalized software costs, and property, plant and equipment.

Segments, Concentrations and Geographic Information - Net Sales to Third Parties by Geographic Region (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 437.8	$ 442.9	$ 1,272.8	$ 1,392.2
North America (primarily U.S.) [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	230.2	251.5	681.3	794.3
Europe Excluding Germany [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	68.8	72.1	214.9	233.8
Germany [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	44.1	54.9	140.7	173.9
China [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	56.5	35.1	150.1	105.8
Asia And Other (Excluding China) [Member]
Revenues from External Customers and Long-Lived Assets [Line Items]
Net sales	$ 38.2	$ 29.3	$ 85.8	$ 84.4

Derivative Financial Instruments - Additional Information (Detail) - USD ($)	1 Months Ended		3 Months Ended				9 Months Ended		12 Months Ended
	Dec. 31, 2018	Jan. 31, 2017	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019	Dec. 31, 2023
Cross Currency Interest Rate Swap [Member]
Derivative [Line Items]
Derivative, term of contract	5 years
Notional Amount	$ 600,000,000.0
Fixed Rate	4.8255%
Proceeds from cross-currency interest rate swaps upon termination					$ 56,200,000
Paid termination fees					900,000
Gain (loss) in AOCIL							$ 31,300,000		$ 19,800,000
AOCIL tax expense (benefit)							9,900,000		3,600,000
Cross Currency Interest Rate Swap [Member] \| Interest Income [Member]
Derivative [Line Items]
Cumulative translation adjustment recognized net interest income (expense), net amount					$ 3,300,000
Cross Currency Interest Rate Swap [Member] \| Forecast [Member]
Derivative [Line Items]
Notional Amount										$ 360,000,000.0
Cross Currency Interest Rate Swap [Member] \| Euro [Member] \| Minimum [Member]
Derivative [Line Items]
Variable Rate	2.19%
Cross Currency Interest Rate Swap [Member] \| Euro [Member] \| Maximum [Member]
Derivative [Line Items]
Variable Rate	2.315%
Interest Rate Swap [Member]
Derivative [Line Items]
Notional Amount	$ 600,000,000
Fixed Rate	4.8255%
Paid termination fees				$ 100,000
Gain (loss) in AOCIL							(11,900,000)		(9,800,000)
AOCIL tax expense (benefit)							(3,800,000)		$ (1,700,000)
Maturity date of interest rate swap		Jan. 31, 2020
Fair value of swap				34,700,000
Net interest expense				$ 100,000
Reclassification of AOCIL in to interest expense			$ 3,400,000			$ 900,000	8,200,000	$ 1,900,000
Non cash interest expense related to termination of interest rate swap			$ 3,400,000				$ 5,600,000

Derivative Financial Instruments - Summary of Impact of Cross-Currency Swaps to AOCIL and Consolidated Statements of Operations (Detail) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Cross Currency Interest Rate Swap [Member]
Derivative [Line Items]
Gain/(Loss) Recognized in AOCI	$ 31.3	$ 19.8

Derivative Financial Instruments - Summary of Fair Value Level 2 Inputs of Company's Derivatives (Detail) - Level 2 [Member] $ in Millions	Dec. 31, 2019 USD ($)
Derivative [Line Items]
Derivative liability (assets)	$ 4.0
Designated as Hedging Instruments [Member] \| Other Long-Term (Assets) [Member] \| Cross Currency Swap Agreements [Member]
Derivative [Line Items]
Derivative assets	(15.0)
Designated as Hedging Instruments [Member] \| Other Long-Term (Assets) [Member] \| Interest Rate Swap Agreement [Member]
Derivative [Line Items]
Derivative assets	(0.0)
Designated as Hedging Instruments [Member] \| Other Long-Term Liabilities [Member] \| Interest Rate Swap Agreement [Member]
Derivative [Line Items]
Derivative liability	$ 19.0

Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions	Sep. 30, 2020	Dec. 31, 2019
Commitments And Contingencies Disclosure [Abstract]
Loss contingency accrual	$ 0	$ 0

Subsequent Events - Additional Information (Detail) - $ / shares		3 Months Ended		9 Months Ended
	Oct. 21, 2020	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Subsequent Event [Line Items]
Cash dividends declared (in USD per share)		$ 0.04	$ 0.17	$ 0.25	$ 0.51
Subsequent Event [Member]
Subsequent Event [Line Items]
Cash dividends declared (in USD per share)	$ 0.06
Dividend declaration date	Oct. 21, 2020
Dividend payable date	Jan. 05, 2021
Dividend record date	Dec. 18, 2020