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Other intangible assets, net of accumulated amortization

^[1]

1,918.7

1,912.0

1,151.2

1,162.4

Other assets

94.8

95.3

Total assets

5,552.0

5,511.4

Current liabilities

Short-term debt

350.0

Accounts payable

417.1

428.8

Other current liabilities

373.7

478.0

Total current liabilities

1,140.8

906.8

Long-term debt

1,538.0

1,507.6

Deferred income taxes

158.2

166.8

Accrued defined benefit plans

173.4

175.9

Other non-current liabilities

183.3

153.2

Total liabilities

3,193.7

2,910.3

Commitments and contingencies (see Note 18)

Fortune Brands stockholders' equity

Common stock

^[2]

1.8

1.7

Paid-in capital

2,740.6

2,724.9

Accumulated other comprehensive loss

(36.0)

(39.2)

Retained earnings

1,249.9

1,174.2

Treasury stock

(1,599.5)

(1,262.1)

Total Fortune Brands stockholders' equity

2,356.8

2,599.5

Noncontrolling interests

1.5

1.6

Total equity

2,358.3

2,601.1

Total liabilities and equity

$ 5,552.0

$ 5,511.4

[1]	Net of accumulated impairment losses of $399.5 million in the Doors segment.
[2]	Common stock, par value $0.01 per share; 180.4 million shares and 179.8 million shares issued at March 31, 2018 and December 31, 2017, respectively.

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares shares in Millions	Mar. 31, 2018	Dec. 31, 2017
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares issued	180.4	179.8

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Operating activities
Net income	$ 74.9	$ 77.4
Non-cash pre-tax expense:
Depreciation	25.3	23.7
Amortization	8.2	8.1
Stock-based compensation	12.6	9.5
Deferred income taxes	(9.2)	7.6
Asset impairment charges		3.2
Amortization of deferred financing fees	0.5	0.5
Loss on sale of property, plant and equipment	0.2
Changes in assets and liabilities:
Increase in accounts receivable	(63.0)	(12.3)
Increase in inventories	(36.9)	(26.2)
Decrease in accounts payable	(3.2)	(10.6)
Increase in other assets	(4.8)	(5.9)
Decrease in accrued expenses and other liabilities	(73.3)	(95.1)
Increase in accrued taxes	16.8	2.2
Net cash used in operating activities	(51.9)	(17.9)
Investing activities
Capital expenditures	(37.6)	(29.5)
Proceeds from disposition of assets	0.7
Cost of acquisition, net of cash acquired	(5.8)	(0.1)
Net cash used in investing activities	(42.7)	(29.6)
Financing activities
Increase in short-term debt	350.0
Issuance of long-term debt	545.0	110.0
Repayment of long-term debt	(515.0)	(50.0)
Proceeds from the exercise of stock options	3.2	8.7
Treasury stock purchases	(325.2)	(27.3)
Employee withholding taxes related to stock-based compensation	(12.2)	(7.8)
Dividends to stockholders	(29.6)	(27.6)
Net cash provided by financing activities	16.2	6.0
Effect of foreign exchange rate changes on cash	(0.2)	0.8
Net decrease in cash and cash equivalents	(78.6)	(40.7)
Cash and cash equivalents at beginning of period	323.0	251.5
Cash and cash equivalents at end of period	$ 244.4	$ 210.8

Condensed Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Capital expenditures incurred but not yet paid	$ 7.6	$ 7.9
Treasury stock purchased but not yet paid	$ 24.8

Condensed Consolidated Statements of Equity (Unaudited) - USD ($) $ in Millions	Total	Common Stock	Paid-In Capital	Accumulated Other Comprehensive Income (Loss)	Retained Earnings	Treasury Stock	Non- controlling Interests
Beginning Balance at Dec. 31, 2016	$ 2,363.0	$ 1.7	$ 2,653.8	$ (71.9)	$ 814.6	$ (1,036.7)	$ 1.5
Comprehensive income:
Net income	77.4				77.4
Other comprehensive income	7.2			7.2
Stock options exercised	8.7		8.7
Stock-based compensation	1.7		9.5			(7.8)
Treasury stock purchase	(27.3)					(27.3)
Ending Balance at Mar. 31, 2017	2,430.7	1.7	2,672.0	(64.7)	892.0	(1,071.8)	1.5
Beginning Balance at Dec. 31, 2017	2,601.1	1.7	2,724.9	(39.2)	1,174.2	(1,262.1)	1.6
Comprehensive income:
Net income	74.9				75.0		(0.1)
Other comprehensive income	3.2			3.2
Stock options exercised	3.2	0.1	3.1
Stock-based compensation	0.4		12.6			(12.2)
Treasury stock purchase	(325.2)					(325.2)
Dividends	0.7				0.7
Ending Balance at Mar. 31, 2018	$ 2,358.3	$ 1.8	$ 2,740.6	$ (36.0)	$ 1,249.9	$ (1,599.5)	$ 1.5

Basis of Presentation and Principles of Consolidation

3 Months Ended

Mar. 31, 2018

Basis of Presentation and Principles of Consolidation

1.	Basis of Presentation and Principles of Consolidation

References to “Fortune Brands,” “the Company,” “we,” “our” and “us” refer to Fortune Brands Home & Security, Inc. and its consolidated subsidiaries as a whole, unless the context otherwise requires.

The Company is a leading home and security products company with a portfolio of leading branded products used for residential home repair, remodeling, new construction and security applications.

The condensed consolidated balance sheet as of March 31, 2018, the related condensed consolidated statements of comprehensive income for the three-months ended March 31, 2018 and 2017 and the related condensed consolidated statements of cash flows and equity for the three-month periods ended March 31, 2018 and 2017 are unaudited. During the first quarter of 2018, we adopted Accounting Standards Update (“ASU”) 2017-07 “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”. As a result, we revised our previously reported condensed consolidated financial statements as of the three months ended March 31, 2017. See Note 12 for further discussion. In the opinion of management, all other adjustments necessary for a fair statement of the financial statements have been included. Interim results may not be indicative of results for a full year.

The condensed consolidated financial statements and notes are presented pursuant to the rules and regulations of the Securities and Exchange Commission and do not contain certain information included in our annual consolidated financial statements and notes. The December 31, 2017 condensed consolidated balance sheet was derived from our audited financial statements, but does not include all disclosures required by U.S. generally accepted accounting principles (“GAAP”). This Quarterly Report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended December 31, 2017.

In October 2017, we acquired Victoria +Albert, a UK-based premium brand of standalone bathtubs, sink, tub fillers, faucets and other accessories. In July 2017, we acquired Shaws Since1897 Limited (“Shaws”), a UK-based luxury plumbing products company that specializes in manufacturing and selling fireclay sinks and selling brassware and accessories. The financial results of both of the acquisitions were included in the Company’s consolidated balance sheets as of March 31, 2018 and December 31, 2017 and in the Company’s consolidated statements of income and statements of cash flow for the three months ended March 31, 2018.

Recently Issued Accounting Standards

3 Months Ended

Mar. 31, 2018

Recently Issued Accounting Standards

2.	Recently Issued Accounting Standards

Revenue from Contracts with Customers

In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, which clarifies the accounting for revenue arising from contracts with customers and specifies the disclosures that an entity should include in its financial statements. The standard is effective for annual reporting periods beginning after December 15, 2017 (calendar year 2018 for Fortune Brands). We adopted ASU 2014-09 as of January 1, 2018 and for periods thereafter using the modified retrospective approach, which we applied to all contracts not completed as of January 1, 2018. The cumulative effect of adopting the new revenue standard was not material and no adjustment was recorded to retained earnings. The comparative financial information has not been restated and continues to be reported under the accounting standards in effect for those periods. The adoption of this standard did not have a material impact on the current quarter and we do not expect it to have a material impact on revenue or net income on an ongoing basis.

A majority of our sales revenue continues to be recognized when products are shipped from our facilities to our customers. Previously, for certain products, we recognized sales revenue at destination as we determined risks and rewards transferred at that point. We will now recognize sales revenue for these customers at the shipping point of the products consistent with the respective contractual terms.

See Note 11 for further information.

Leases

In February 2016, the FASB issued ASU 2016-02, which requires lessees to recognize almost all leases on their balance sheet as a “right-of-use” asset and lease liability but recognize related expenses in a manner similar to current accounting. The guidance also eliminates current real estate-specific provisions for all entities. In January 2018, the FASB issued ASU 2018-01, which clarifies the application of the new leases guidance to land easements. The standard is effective for annual periods beginning after December 15, 2018 (calendar year 2019 for Fortune Brands) and earlier application is permitted. We are assessing the impact the adoption of this standard will have on our financial statements.

Stock Compensation Scope of Modification Accounting

In May 2017, the FASB issued ASU 2017-09, which clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. The new guidance provides a relief to entities that make non-substantive changes to their share-based payment awards and will result in fewer changes to the terms of an award being accounted for as modifications. We adopted the new standard beginning January 1, 2018. The adoption of this standard did not have a material effect on our financial statements.

Clarifying the Definition of a Business

In January 2017, the FASB issued ASU 2017-01, which changes the definition of a business to assist entities with evaluating when a set of transferred assets and activities is a business and therefore business combination guidance would apply. The new standard requires an entity to evaluate if substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset (i.e., a business) or a group of similar identifiable assets (i.e., not a business). The guidance also requires a business to include at least one substantive process and narrows the definition of outputs (e.g., revenues with customers). We adopted the new standard beginning January 1, 2018. The adoption of this standard did not have a material effect on our financial statements.

Restricted Cash

In November 2016, the FASB issued ASU 2016-18, according to which entities are no longer required to present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. The prior standard did not address the classification of activity related to restricted cash and restricted cash equivalents in the statement of cash flows and this has resulted in diversity in cash flows presentation. We adopted the new standard beginning January 1, 2018. The adoption of this standard did not have a material effect on our financial statements.

Intra-Entity Transfers of Assets Other Than Inventory

In October 2016, the FASB issued ASU 2016-16, which requires companies to account for the income tax effects of intercompany sales and transfers of assets other than inventory (e.g., intangible assets) when the transfer occurs. Under the current guidance companies are required to defer the income tax effects of intercompany transfers of assets until the asset has been sold to an outside party or otherwise recognized (e.g., depreciated, amortized or impaired). We adopted the new standard beginning January 1, 2018 using a “modified retrospective” (i.e., with a cumulative adjustment to retained earnings at adoption). The adoption of this standard did not have a material effect on our financial statements.

Classification of Certain Cash Receipts and Cash Payments

In September 2016 the FASB issued ASU 2016-15, which changes how an entity classifies certain cash receipts and cash payments on its statement of cash flows. The key changes that may potentially impact our financial statements include the following: 1) Cash payments for debt prepayment or extinguishment costs would be classified as financing cash outflows; 2) Contingent consideration payments that are not made within three months after the consummation of a business combination would be classified as financing (if the payment is made up to the acquisition date fair value of liability) or operating outflows (if in excess of acquisition fair value). Cash payments made “soon after” the consummation of a business combination generally would be classified as cash outflows for investing activities; 3) Insurance settlement proceeds would be classified based on the nature of the loss; and 4) Company-owned life insurance settlement proceeds would be presented as investing cash inflows, and premiums would be classified as investing or operating cash outflows, or a combination of both. We retrospectively adopted the new standard beginning January 1, 2018. The adoption of this standard did not have a material effect on our financial statements.

Recognition and Measurement of Financial Assets and Financial Liabilities

In January 2016, the FASB issued ASU 2016-01, which requires entities to measure investments in unconsolidated entities (other than those accounted for using the equity method of accounting) at fair value through the income statement. There will no longer be an available-for-sale classification (with changes in fair value reported in Other Comprehensive Income). In addition, the cost method is eliminated for equity investments without readily determinable fair values. We adopted the new standard beginning January 1, 2018. The adoption of this standard did not have a material effect on our financial statements.

Clarifying Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets

In May 2017, the FASB issued ASC 610-20 that clarifies the scope and application of various standards for the sale of nonfinancial assets (e.g. PP&E including real estate, intangible assets, materials and supplies). The standard distinguishes between a sale to customer vs non-customer. Sales to customers are in scope of the new revenue standard. It also clarifies a derecognition model for nonfinancial assets that do not represent a business. We adopted the new standard beginning January 1, 2018 consistent with the effective date for the new revenue recognition standard. The adoption of this standard did not have a material effect on our financial statements.

Improvements to Accounting for Hedging Activities

In August 2017, the FASB issued ASU 2017-12 which amends the current hedge accounting model. The new standard eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item (which is consistent with our current practice). The change in fair value for qualifying cash flow and net investment hedges will be included in Other comprehensive income (until they are reclassified into the income statement). The standard also eases certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. The standard is effective as of January 1, 2019 and earlier application is permitted. We are assessing the impact the adoption of this standard will have on our financial statements.

Financial Instruments—Credit Losses

In June 2016, the FASB issued ASU 2016-13, which changes the impairment model for most financial assets and certain other instruments that are not measured at fair value through net income. The new guidance applies to most financial assets measured at amortized cost, including trade and other receivables and loans as well as off-balance-sheet credit exposures (e.g., loan commitments and standby letters of credit). The standard will replace the “incurred loss” approach under the current guidance with an “expected loss” model that requires an entity to estimate its lifetime “expected credit loss.” The standard is effective January 1, 2020 and early application is permitted beginning January 1, 2019. We are assessing the impact the adoption of this standard will have on our financial statements.

Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income

In February 2018, the FASB issued ASU No. 2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.” This guidance is applicable to the Company’s fiscal year beginning January 1, 2019, with early adoption permitted. We are assessing the impact the adoption of this standard will have on our financial statements.

Balance Sheet Information

3 Months Ended

Mar. 31, 2018

Balance Sheet Information

3.	Balance Sheet Information

Supplemental information on our balance sheets is as follows:


(In millions)	March 31, 2018		December 31, 2017
Inventories:
Raw materials and supplies	$	233.8	$	224.9
Work in process		62.6		58.3
Finished products		322.8		297.6

Total inventories	$	619.2	$	580.8
Property, plant and equipment, gross	$	1,803.8	$	1,780.4
Less: accumulated depreciation		1,061.0		1,040.4

Property, plant and equipment, net	$	742.8	$	740.0

Acquisitions and Dispositions

3 Months Ended

Mar. 31, 2018

Acquisitions and Dispositions

4.	Acquisitions and Dispositions

In October 2017, we acquired Victoria + Albert, a UK manufacturer of luxury freestanding tubs and basins. In July 2017, we acquired Shaws, a UK-based luxury plumbing products company that specializes in manufacturing and selling fireclay sinks and selling brassware and accessories. The total combined consideration paid was approximately $132 million, subject to certain post-closing adjustments and deferred acquisition payments. Net sales and operating income in the first three months of 2018 from these acquisitions were not material to the Company. We financed the transactions using cash on hand and borrowings under our existing revolving credit facility. The results of the operations are included in the Plumbing segment from the date of acquisition. We do not expect any portion of goodwill to be deductible for income tax purposes.

In April 2017, we completed the sale of Field ID, our cloud-based inspection and safety compliance software product line formerly included in our Security segment.

Goodwill and Identifiable Intangible Assets

3 Months Ended

Mar. 31, 2018

Goodwill and Identifiable Intangible Assets

5.	Goodwill and Identifiable Intangible Assets

We had goodwill of $1,918.7 million and $1,912.0 million as of March 31, 2018 and December 31, 2017, respectively. The $6.7 million increase was primarily due to acquisition-related adjustments in our Plumbing segment, including $5.8 million of additional purchase price consideration paid during the three months ended March 31, 2018 related to our acquisition of Victoria + Albert, partially offset by foreign translation adjustments. The change in the net carrying amount of goodwill by segment was as follows:


(In millions)	Cabinets			Plumbing			Doors		Security			Total Goodwill
Goodwill at December 31, 2017 ^(a)	$	926.3		$	745.2		$	143.0	$	97.5		$	1,912.0
Year-to-date translation adjustments		(0.2	)		(1.1	)		—		(0.5	)		(1.8	)
Acquisition-related adjustments		—			8.5			—		—			8.5

Goodwill at March 31, 2018 ^(a)	$	926.1		$	752.6		$	143.0	$	97.0		$	1,918.7

^(a)

Net of accumulated impairment losses of $399.5 million in the Doors segment.

We also had net identifiable intangible assets, principally tradenames, of $1,151.2 million and $1,162.4 million as of March 31, 2018 and December 31, 2017, respectively. The $3.3 million decrease in gross identifiable intangible assets was primarily due to acquisition related adjustments and foreign translation adjustments.

The gross carrying value and accumulated amortization by class of identifiable intangible assets as of March 31, 2018 and December 31, 2017 were as follows:


(In millions)	As of March 31, 2018							As of December 31, 2017
	Gross Carrying Amounts		Accumulated Amortization			Net Book Value		Gross Carrying Amounts		Accumulated Amortization			Net Book Value
Indefinite-lived tradenames	$	709.2	$	—		$	709.2	$	709.9	$	—		$	709.9

Amortizable intangible assets
Tradenames		15.7		(10.4	)		5.3		15.7		(9.9	)		5.8
Customer and contractual relationships		661.1		(238.8	)		422.3		663.8		(232.0	)		431.8
Patents/proprietary technology		60.3		(45.9	)		14.4		60.2		(45.3	)		14.9

Total		737.1		(295.1	)		442.0		739.7		(287.2	)		452.5

Total identifiable intangibles	$	1,446.3	$	(295.1	)	$	1,151.2	$	1,449.6	$	(287.2	)	$	1,162.4

Amortizable identifiable intangible assets, principally tradenames and customer relationships, are subject to amortization over their estimated useful life, ranging from 2 to 20 years, based on the assessment of a number of factors that may impact useful life. These factors include historical and tradename performance with respect to consumer name recognition, geographic market presence, market share, plans for ongoing tradename support and promotion, customer attrition rates and other relevant factors.

In the first quarter of 2018, no events or circumstances occurred that would have required us to perform interim impairment tests of goodwill or indefinite-lived tradenames. As of December 31, 2017, the fair value of two tradenames in the Cabinets segment exceeded their carrying value by less than 10%. Accordingly, a reduction in the estimated fair value of these tradenames could trigger an impairment. As of December 31, 2017, the total carrying value of these tradenames was $217.8 million. Factors influencing our fair value estimates of the tradenames are described in the following paragraph.

The events and/or circumstances that could have a potential negative effect on the estimated fair value of our reporting units and indefinite-lived tradenames include: actual new construction and repair and remodel growth rates that lag our assumptions, actions of key customers, volatility of discount rates, continued economic uncertainty, higher levels of unemployment, weak consumer confidence, lower levels of discretionary consumer spending, a decrease in royalty rates and decline in the trading price of our common stock. We cannot predict the occurrence of certain events or changes in circumstances that might adversely affect the carrying value of goodwill and indefinite-lived intangible assets.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

Asset Impairment

3 Months Ended

Mar. 31, 2018

Asset Impairment

6.	Asset Impairment

In January 2017, we committed to a plan to sell Field ID, our cloud-based inspection and safety compliance software product line included in our Security segment. In accordance with FASB Accounting Standards Codification (“ASC”) 360, as a result of our decision to sell, we recorded $3.2 million of pre-tax impairment charges to write down the long-lived assets included in this disposal group to fair value during the first quarter of 2017, based upon their estimated fair value less cost to sell. These charges consisted of approximately $3.0 million for definite-lived intangible assets and $0.2 million for fixed assets. We completed the sale of Field ID in April 2017.

External Debt and Financing Arrangements

3 Months Ended

Mar. 31, 2018

External Debt and Financing Arrangements

7.	External Debt and Financing Arrangements

In March 2018, the Company entered into a $350 million term loan for general corporate purposes that matures in March 2019. Interest rates under the term loan are variable based on LIBOR at the time of the borrowing and the Company’s long-term credit rating and can range from LIBOR + 0.625% to LIBOR + 1.25%. Covenants under the term loan are the same as the existing $1.25 billion revolving credit agreement. As of March 31, 2018, we were in compliance with all covenants under this facility.

In June 2016, the Company amended and restated its credit agreement to combine and rollover the existing revolving credit facility and term loan into a new standalone $1.25 billion revolving credit facility. The facility amendment of the amended and restated credit agreement was a non-cash transaction for the Company. Terms and conditions of the credit agreement, including the total commitment amount, essentially remained the same. The revolving credit facility will mature in June 2021 and borrowings thereunder will be used for general corporate purposes. On March 31, 2018 and December 31, 2017, our outstanding borrowings under this facility were $645.0 million and $615.0 million, respectively. At March 31, 2018 and December 31, 2017, the current portion of long-term debt was zero. Interest rates under the facility are variable based on LIBOR at the time of the borrowing and the Company’s long-term credit rating and can range from LIBOR + 0.9% to LIBOR + 1.5%. As of March 31, 2018, we were in compliance with all covenants under this facility.

In June 2015, we issued $900 million of unsecured senior notes (“Senior Notes”) in a registered public offering. The Senior Notes consist of two tranches: $400 million of five-year notes due 2020 with a coupon of 3% and $500 million of ten-year notes due 2025 with a coupon of 4%. We used the proceeds from the Senior Notes offering to pay down our revolving credit facility and for general corporate purposes. On March 31, 2018 and December 31, 2017, the net carrying value of the Senior Notes, net of underwriting commissions, price discounts and debt issuance costs, was $893.0 million and $892.6 million, respectively.

We currently have uncommitted bank lines of credit in China, which provide for unsecured borrowings for working capital of up to $23.5 million in aggregate, of which there were no outstanding balances as of March 31, 2018 and December 31, 2017.

Financial Instruments

3 Months Ended

Mar. 31, 2018

Financial Instruments

8.	Financial Instruments

We do not enter into financial instruments for trading or speculative purposes. We principally use financial instruments to reduce the impact of changes in foreign currency exchange rates and commodities used as raw materials in our products. The principal derivative financial instruments we enter into on a routine basis are foreign exchange contracts. Derivative financial instruments are recorded at fair value. The counterparties to derivative contracts are major financial institutions. We are subject to credit risk on these contracts equal to the fair value of these instruments. Management currently believes that the risk of incurring material losses is unlikely and that the losses, if any, would be immaterial to the Company.

Raw materials used by the Company are subject to price volatility caused by weather, supply conditions, geopolitical and economic variables, and other unpredictable external factors. As a result, from time to time, we enter into commodity swaps to manage the price risk associated with forecasted purchases of materials used in our operations.

Our primary foreign currency hedge contracts pertain to the Canadian dollar, the British pound, and the Mexican peso. The gross U.S. dollar equivalent notional amount of all foreign currency derivative hedges outstanding at March 31, 2018 was $304.3 million. Based on foreign exchange rates as of March 31, 2018, we estimate that $1.9 million of net foreign currency derivative gains included in other comprehensive income as of March 31, 2018 will be reclassified to earnings within the next twelve months.

The fair values of derivative instruments on the consolidated balance sheets as of March 31, 2018 and December 31, 2017 were as follows:


(In millions)		Fair Value
	Location	March 31, 2018		December 31, 2017
Assets
Foreign exchange contracts	Other current assets	$	2.8	$	0.8
Commodity contracts	Other current assets		—		0.2

	Total assets	$	2.8	$	1.0

Liabilities
Foreign exchange contracts	Other current liabilities	$	1.6	$	5.6
Net investment hedges	Other current liabilities		1.1		0.8

	Total liabilities	$	2.7	$	6.4

The effects of derivative financial instruments on the statements of comprehensive income for the three months ended March 31, 2018 and 2017 were as follows:


		(Loss) Gain Recognized in Income
(In millions) Type of hedge	Location	March 31, 2018			March 31, 2017
Cash flow	Cost of products sold	$	(0.5	)	$	(0.6	)
Fair value	Other income, net		(0.1	)		(1.1	)

Total		$	(0.6	)	$	(1.7	)

The effective portion of cash flow hedges recognized in other comprehensive income were net gains of $4.3 million and $2.1 million at March 31, 2018 and 2017, respectively. In the three months ended March 31, 2018 and 2017, the ineffective portion of cash flow hedges recognized in other income, net, was insignificant.

Fair Value Measurements

3 Months Ended

Mar. 31, 2018

Fair Value Measurements

9.	Fair Value Measurements

ASC requirements for Fair Value Measurements and Disclosures establish a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels. Level 1 inputs, the highest priority, are quoted prices in active markets for identical assets or liabilities. Level 2 inputs reflect inputs other than quoted prices included in level 1 that are either observable directly or through corroboration with observable market data. Level 3 inputs are unobservable inputs, due to little or no market activity for the asset or liability, such as internally-developed valuation models. We do not have any assets or liabilities measured at fair value on a recurring basis that are level 3.

The carrying value, net of underwriting commissions, price discounts, and debt issuance costs and fair value of debt as of March 31, 2018 and December 31, 2017 were as follows:


(In millions)	March 31, 2018				December 31, 2017
	Carrying Value		Fair Value		Carrying Value		Fair Value
Revolving credit facility	$	645.0	$	645.0	$	615.0	$	615.0
Term Loan		350.0		350.0		—		—
Senior Notes		893.0		908.2		892.6		926.3

The estimated fair value of our term loan and revolving credit facility is determined primarily using broker quotes, which are level 2 inputs. The estimated fair value of our Senior Notes is determined by using quoted market prices of our debt securities, which are level 2 inputs.

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017 were as follows:


(In millions)	Fair Value
	March 31, 2018		December 31, 2017
Assets
Derivative financial instruments (level 2)	$	2.8	$	1.0
Deferred compensation program assets (level 2)		7.8		7.5

Total assets	$	10.6	$	8.5

Liabilities
Derivative financial instruments (level 2)	$	2.7	$	6.4

- Definition

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

+ References + Details

Accumulated Other Comprehensive Loss

3 Months Ended

Mar. 31, 2018

Accumulated Other Comprehensive Loss

10. Accumulated Other Comprehensive Loss

Total accumulated other comprehensive (loss) income consists of net income and other changes in business equity from transactions and other events from sources other than shareholders. It includes currency translation gains and losses, unrealized gains and losses from derivative instruments designated as cash flow hedges, and defined benefit plan adjustments. The after-tax components of and changes in accumulated other comprehensive (loss) income were as follows:


(In millions)	Foreign Currency Adjustments			Derivative Hedging Gain (Loss)			Defined Benefit Plan Adjustments^(a)			Accumulated Other Comprehensive Loss
Balance at December 31, 2016	$	(28.0	)	$	(0.6	)	$	(43.3	)	$	(71.9	)
Amounts classified into accumulated other comprehensive loss		6.8			1.6			—			8.4
Amounts reclassified from accumulated other comprehensive loss		—			0.6			(1.8	)		(1.2	)

Net current-period other comprehensive income (loss)		6.8			2.2			(1.8	)		7.2

Balance at March 31, 2017	$	(21.2	)	$	1.6		$	(45.1	)	$	(64.7	)
Balance at December 31, 2017	$	5.8		$	(2.4	)	$	(42.6	)	$	(39.2	)
Amounts classified into accumulated other comprehensive (income) loss		(0.8	)		3.5			0.2			2.9
Amounts reclassified from accumulated other comprehensive loss		—			0.3			—			0.3

Net current-period other comprehensive income (loss)		(0.8	)		3.8			0.2			3.2

Balance at March 31, 2018	$	5.0		$	1.4		$	(42.4	)	$	(36.0	)

^(a)

See Note 12, “Defined Benefit Plans,” for further information on the adjustments related to defined benefit plans.

The reclassifications out of accumulated other comprehensive loss for the three months ended March 31, 2018 and 2017 were as follows:


(In millions)
Details about Accumulated Other Comprehensive Loss Components	Amount Reclassified from Accumulated Other Comprehensive Loss Three Months Ended March 31,						Affected Line Item in the Statement of Comprehensive Income
	2018			2017
Losses on cash flow hedges
Foreign exchange contracts	$	(0.5	)	$	(0.6	)		Cost of products sold

		(0.5	)		(0.6	)		Total Before Tax
		0.2			—			Tax expense

	$	(0.3	)	$	(0.6	)		Net of tax
Defined benefit plan items
Recognition of prior service credits	$	—		$	3.0			^(a)

		—			3.0			Total before tax
		—			(1.2	)		Tax expense

	$	—		$	1.8			Net of tax

Total reclassifications for the period	$	(0.3	)	$	1.2			Net of tax

^(a)

These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost. Refer to Note 12, “Defined Benefit Plans,” for additional information.

Revenue

3 Months Ended

Mar. 31, 2018

Revenue

11.

Revenue

Our principal performance obligations are the sale of kitchen and bath cabinets, faucets and accessories, fiberglass and steel entry-door systems and locks, safes, safety and security devices (“goods” or “products”). The Company recognizes revenue for the sale of goods based on its assessment of when control transfers to our customers. For the majority of our sales, we recognize revenue at the point in time when we ship product from our facilities to our customers. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods to our customers. Payment terms on our product sales range from 30 to 90 days. Taxes assessed by a governmental authority that we collect are excluded from revenue. The expected costs associated with our contractual warranties will continue to be recognized as expense when the products are sold (See Note 14).

We record estimates to reduce revenue for customer programs and incentives, which are considered variable consideration, and include price discounts, volume-based incentives, promotions and cooperative advertising when revenue is recognized in order to determine the amount of consideration the Company will ultimately be entitled to receive. These estimates are based on historical and projected experience for each type of customer. In addition, for certain customer program incentives, we receive an identifiable benefit (goods or services) in exchange for the consideration given and record the associated expenditure in selling, general and administrative expenses.

We account for shipping and handling costs that occur after the customer has obtained control of a product as a fulfillment activity (i.e., as an expense) rather than as a promised service (i.e., as a revenue element). These costs are classified within selling, general and administrative expenses.

Settlement of our outstanding accounts receivable balances is normally within 30 to 90 days of the original sale transaction date. Obligations arising from customer rights to return our goods for any reason, including among others, product obsolescence, stock rotations, trade-in agreements for newer products and upon termination of a customer contract. We estimate future product returns at the time of sale based on historical experience and record a corresponding refund obligation, which amounted to $11.7 million as of March 31, 2018. Refund obligations are classified within other current liabilities in our consolidated balance sheet. Return assets related to the refund obligation are measured at the carrying amount of the goods at the time of sale, less any expected costs to recover the goods and any expected reduction in value. Return assets are classified within other current assets and were immaterial as of March 31, 2018.

The Company disaggregates revenue from contracts with customers into (i) major sales distribution channels in the U.S. and (ii) total sales to customers outside the U.S. market as these categories depict the nature, amount, timing and uncertainty of revenues and cash flows that are affected by economic factors. The following table disaggregates our consolidated revenue by major sales distribution channels for the three months ended March 31, 2018.


(In millions)
	Three Months Ended March 31,
	2018
Wholesalers ⁽¹⁾	$	585.6
Home Center retailers⁽²⁾		349.7
Other retailers ⁽³⁾		76.1
Builder direct		51.5

U.S. net sales		1,062.9
International ⁽⁴⁾		191.7

Net sales	$	1,254.6

(1)

Represents sales to customers whose business is oriented towards builders, professional trades and home remodelers, inclusive of sales through our customer’s respective internet website portals.

(2)

Represents sales to the three largest “Do-It-Yourself” retailers; The Home Depot, Inc., Lowes Companies, Inc. and Menards, Inc, inclusive of sales through their respective internet website portals.

(3)

Represents sales principally to our mass merchant and standalone independent e-commerce customers.

(4)

Represents sales in markets outside the United States, principally in China, Canada, Europe and Mexico.

Practical Expedients

Incremental costs of obtaining a contract include only those costs the company incurs that would not have been incurred if the contract had not been obtained. These costs are required to be recognized as assets and amortized over the period that the related goods or services transfer to the customer. As a practical expedient, we expense as incurred costs to obtain a contract when the expected amortization period is one year or less. These costs are recorded within selling, general and administrative expenses.

Defined Benefit Plans

3 Months Ended

Mar. 31, 2018

Defined Benefit Plans

12.

Defined Benefit Plans

The components of net periodic benefit cost for pension and postretirement benefits for the three months ended March 31, 2018 and 2017 were as follows:


(In millions)	Three Months Ended March 31,
	Pension Benefits						Postretirement Benefits
	2018			2017			2018		2017
Service cost	$	0.2		$	0.1		$	—	$	—
Interest cost		7.6			8.4			—		—
Expected return on plan assets		(10.3	)		(9.3	)		—		—
Recognition of prior service credits		—			—			—		(3.0	)

Net periodic benefit income	$	(2.5	)	$	(0.8	)	$	—	$	(3.0	)

Service cost for 2018 relates to benefit accruals in an hourly Union defined benefit plan in our Security segment. All other defined benefit pension plans were frozen as of December 31, 2016.

In March 2017, the FASB issued ASU 2017-07, which requires entities to present the defined benefit plan non-service related costs outside the operating income subtotal. The new guidance was applied retrospectively in the condensed consolidated statement of comprehensive income. As a result, we reclassified $3.9 million of income from the operating income subtotal to the other income, net subtotal. The retrospective impact of adopting ASU 2017-07 on the three months ended March 31, 2017 was as follows:


(In millions)
	Three Months Ended March 31,
	2017
Increase/(decrease) to cost of products sold	$	2.9
Increase/(decrease) to selling, general and administrative expenses		1.0

Increase/(decrease) to operating income	$	(3.9	)

Income Taxes

3 Months Ended

Mar. 31, 2018

Income Taxes

13.

Income Taxes

The effective income tax rates for the three months ended March 31, 2018 and 2017 were 30.1% and 25.4%, respectively. The effective income tax rate in 2018 was favorably impacted by the corporate tax rate reduction from 35% to 21% under the Tax Cuts and Jobs Act of 2017 (the “Tax Act”), and a benefit associated with the U.S. research and development credit. The effective income tax rate in 2018 was unfavorably impacted by an adjustment to the deemed repatriation tax liability recorded in 2017 under the Tax Act, the repeal of the Domestic Production Activity (Internal Revenue Code Section 199) Deduction, state and local taxes, and increases to uncertain tax positions.

The effective income tax rate in 2017 was favorably impacted by a tax benefit attributable to the share-based compensation (ASU 2016-09) deduction, a tax benefit attributable to the Domestic Production Activity (Internal Revenue Code Section 199) Deduction, favorable tax rates in foreign jurisdictions, and a benefit associated with the U.S. research and development credit, offset by state and local taxes and increases to uncertain tax positions.

On December 22, 2017, Staff Accounting Bulletin No. 118 (“SAB 118”) was issued which deals with the application of U.S. GAAP to situations where a registrant does not have the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of the Tax Act. In accordance with SAB 118 we calculated our best estimate of the impact of the Tax Act on our 2017 effective income tax rate at our assessment date of January 22, 2018. Due to additional guidance received after our assessment date and additional analysis, an unfavorable adjustment of $5.4 million, impacting the three months ended March 31, 2018, was recorded to income tax expense. As of March 31, 2018, we have not completed our accounting for all of the tax effects of the Tax Act.

It is reasonably possible that, within the next 12 months, total unrecognized tax benefits may decrease in the range of $2.0 million to $22.0 million, primarily as a result of the conclusion of pending U.S. federal, state and foreign income tax proceedings.

Product Warranties

3 Months Ended

Mar. 31, 2018

Product Warranties

14.

Product Warranties

We generally record warranty expense related to contractual warranty terms at the time of sale. We may also provide customer concessions for claims made outside of the contractual warranty terms and those expenses are recorded in the period in which the concession is made. We offer our customers various warranty terms based on the type of product that is sold. Warranty expense is determined based on historic claim experience and the nature of the product category. The following table summarizes activity related to our product warranty liability for the three months ended March 31, 2018 and 2017, respectively.


(In millions)	Three Months Ended March 31,
	2018			2017
Reserve balance at January 1,	$	17.2		$	16.2
Provision for warranties issued		6.2			8.2
Settlements made (in cash or in kind)		(6.2	)		(8.5	)

Reserve balance at March 31,	$	17.2		$	15.9

Information on Business Segments

3 Months Ended

Mar. 31, 2018

Information on Business Segments

15.

Information on Business Segments

Net sales and operating income for the three months ended March 31, 2018 and 2017 by segment were as follows:


	Three Months Ended March 31,
(In millions)	2018			2017			% Change vs. Prior Year
Net Sales
Cabinets	$	557.2		$	573.6			(2.9	)%
Plumbing		449.7			378.4			18.8
Doors		110.3			102.2			7.9
Security		137.4			132.6			3.6

Net sales	$	1,254.6		$	1,186.8			5.7	%

Operating Income (Loss)
Cabinets	$	24.1		$	47.0			(48.7	)%
Plumbing ^(a)		88.4			67.2			31.5
Doors		13.1			8.2			59.8
Security		15.1			10.1			49.5
Less: Corporate expenses ^(a)		(21.3	)		(21.5	)		0.9

Operating income	$	119.4		$	111.0			7.6	%

Corporate expenses ^(a)
General and administrative expense	$	(21.3	)	$	(21.5	)

Total Corporate expenses	$	(21.3	)	$	(21.5	)		0.9

^(a)

We revised our previously reported results for the three months ended March 31, 2017 for ASU 2017-07, Presentation of Net Periodic Pension and Postretirement Costs.

Restructuring and Other Charges

3 Months Ended

Mar. 31, 2018

Restructuring and Other Charges

16.

Restructuring and Other Charges

Pre-tax restructuring and other charges for the three months ended March 31, 2018 and 2017 are shown below.


(In millions)	Three Months Ended March 31, 2018
	Restructuring Charges			Other Charges ^(a)			Total Charges
Cabinets	$	0.3		$	(0.2	)	$	0.1
Plumbing		(0.2	)		—			(0.2	)
Security		—			0.1			0.1
Doors		0.7			—			0.7

Total	$	0.8		$	(0.1	)	$	0.7

Restructuring and other charges in the first quarter of 2018 largely related to severance costs within our Doors and Cabinets segments.


(In millions)	Three Months Ended March 31, 2017
	Restructuring Charges			Other Charges ^(a)		Total Charges
Plumbing	$	1.4		$	—	$	1.4
Doors		(0.2	)		—		(0.2	)
Security		1.0			0.7		1.7

Total	$	2.2		$	0.7	$	2.9

^(a)

“Other Charges” represent charges directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such costs may include losses on disposal of inventories, trade receivables allowances from exiting product lines, accelerated depreciation resulting from the closure of facilities and gains or losses on the sale of previously closed facilities.

Restructuring and other charges in the first quarter of 2017 largely related to severance costs within our Plumbing and Security segments.

Reconciliation of Restructuring Liability


(In millions)	Balance at 12/31/17		2018 Provision		Cash Expenditures ^(a)			Non-Cash Write-offs ^(b)			Balance at 3/31/18
Workforce reduction costs	$	5.0	$	0.8	$	(2.0	)	$	—		$	3.8
Other		0.8		—		—			(0.3	)		0.5

	$	5.8	$	0.8	$	(2.0	)	$	(0.3	)	$	4.3

^(a)

Cash expenditures primarily related to severance charges.

^(b)

Non-cash write-offs include long-lived asset impairment charges attributable to restructuring actions.


(In millions)	Balance at 12/31/16		2017 Provision		Cash Expenditures ^(a)			Non-Cash Write-offs ^(b)		Balance at 3/31/17
Workforce reduction costs	$	2.4	$	1.9	$	(1.0	)	$	—	$	3.3
Other		0.6		0.3		(0.6	)		—		0.3

	$	3.0	$	2.2	$	(1.6	)	$	—	$	3.6

^(a)

Cash expenditures primarily related to severance charges.

^(b)

Non-cash write-offs include long-lived asset impairment charges attributable to restructuring actions.

Earnings Per Share

3 Months Ended

Mar. 31, 2018

Earnings Per Share

17.

Earnings Per Share

The computations of earnings per common share for the three months ended March 31, 2018 and 2017 were as follows:


(In millions, except per share data)	Three Months Ended March 31,
	2018			2017
Income from continuing operations, net of tax	$	75.1		$	77.4
Less: Noncontrolling interest		(0.1	)		—

Income from continuing operations for EPS		75.2			77.4
Loss from discontinued operations		(0.2	)		—

Net income attributable to Fortune Brands	$	75.0		$	77.4

Earnings per common share
Basic
Continuing operations	$	0.50		$	0.50
Discontinued operations		—			—

Net income attributable to Fortune Brands common stockholders	$	0.50		$	0.50
Diluted
Continuing operations	$	0.49		$	0.50
Discontinued operations		—			—

Net income attributable to Fortune Brands common stockholders	$	0.49		$	0.50
Basic average shares outstanding		149.9			153.3
Stock-based awards		2.2			2.9

Diluted average shares outstanding		152.1			156.2
Antidilutive stock-based awards excluded from weighted-average number of shares outstanding for diluted earnings per share		0.5			0.6

Contingencies

3 Months Ended

Mar. 31, 2018

Contingencies

18.

Contingencies

Litigation

We are defendants in lawsuits associated with the normal conduct of our businesses and operations. It is not possible to predict the outcome of the pending actions, and, as with any litigation, it is possible that these actions could be decided unfavorably to the Company. The Company believes that there are meritorious defenses to these actions and that these actions will not have a material adverse effect upon our results of operations, cash flows or financial condition, and where appropriate, these actions are being vigorously contested.

Environmental

Compliance with federal, state and local laws regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment, did not have a material effect on capital expenditures, earnings or the competitive position of Fortune Brands during the three months ended March 31, 2018 and 2017. We are involved in remediation activities to clean up hazardous wastes as required by federal and state laws. Liabilities for remediation costs of each site are based on our best estimate of undiscounted future costs, excluding possible insurance recoveries or recoveries from other third parties. We believe, compliance with current environmental protection laws (before taking into account estimated recoveries from third parties) will not have a material adverse effect upon our results of operations, cash flows or financial condition. Uncertainties about the status of laws, regulations, technology and information related to individual sites make it difficult to develop estimates of environmental remediation exposures.

Subsequent Event

3 Months Ended

Mar. 31, 2018

Subsequent Event

19.

Subsequent Event

On April 30, 2018, the Company’s Board of Directors authorized the repurchase of up to $150 million of shares of the Company’s common stock over the two years ending April 30, 2020. The share repurchase programs do not obligate the Company to repurchase any specific dollar amount or number of shares and may be suspended or discontinued at any time.

Balance Sheet Information (Tables)

3 Months Ended

Mar. 31, 2018

Supplemental Information on Balance Sheets

Supplemental information on our balance sheets is as follows:


(In millions)	March 31, 2018		December 31, 2017
Inventories:
Raw materials and supplies	$	233.8	$	224.9
Work in process		62.6		58.3
Finished products		322.8		297.6

Total inventories	$	619.2	$	580.8
Property, plant and equipment, gross	$	1,803.8	$	1,780.4
Less: accumulated depreciation		1,061.0		1,040.4

Property, plant and equipment, net	$	742.8	$	740.0

Goodwill and Identifiable Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2018

Change in Net Carrying Amount of Goodwill by Segment

The change in the net carrying amount of goodwill by segment was as follows:


(In millions)	Cabinets			Plumbing			Doors		Security			Total Goodwill
Goodwill at December 31, 2017 ^(a)	$	926.3		$	745.2		$	143.0	$	97.5		$	1,912.0
Year-to-date translation adjustments		(0.2	)		(1.1	)		—		(0.5	)		(1.8	)
Acquisition-related adjustments		—			8.5			—		—			8.5

Goodwill at March 31, 2018 ^(a)	$	926.1		$	752.6		$	143.0	$	97.0		$	1,918.7

^(a)

Net of accumulated impairment losses of $399.5 million in the Doors segment.

Gross Carrying Value and Accumulated Amortization by Class of Identifiable Intangible Assets

The gross carrying value and accumulated amortization by class of identifiable intangible assets as of March 31, 2018 and December 31, 2017 were as follows:


(In millions)	As of March 31, 2018							As of December 31, 2017
	Gross Carrying Amounts		Accumulated Amortization			Net Book Value		Gross Carrying Amounts		Accumulated Amortization			Net Book Value
Indefinite-lived tradenames	$	709.2	$	—		$	709.2	$	709.9	$	—		$	709.9

Amortizable intangible assets
Tradenames		15.7		(10.4	)		5.3		15.7		(9.9	)		5.8
Customer and contractual relationships		661.1		(238.8	)		422.3		663.8		(232.0	)		431.8
Patents/proprietary technology		60.3		(45.9	)		14.4		60.2		(45.3	)		14.9

Total		737.1		(295.1	)		442.0		739.7		(287.2	)		452.5

Total identifiable intangibles	$	1,446.3	$	(295.1	)	$	1,151.2	$	1,449.6	$	(287.2	)	$	1,162.4

Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2018

Fair Values of Derivative Instruments

The fair values of derivative instruments on the consolidated balance sheets as of March 31, 2018 and December 31, 2017 were as follows:


(In millions)		Fair Value
	Location	March 31, 2018		December 31, 2017
Assets
Foreign exchange contracts	Other current assets	$	2.8	$	0.8
Commodity contracts	Other current assets		—		0.2

	Total assets	$	2.8	$	1.0

Liabilities
Foreign exchange contracts	Other current liabilities	$	1.6	$	5.6
Net investment hedges	Other current liabilities		1.1		0.8

	Total liabilities	$	2.7	$	6.4

Effects of Derivative Financial Instruments on Consolidated Statements of Income

The effects of derivative financial instruments on the statements of comprehensive income for the three months ended March 31, 2018 and 2017 were as follows:


		(Loss) Gain Recognized in Income
(In millions) Type of hedge	Location	March 31, 2018			March 31, 2017
Cash flow	Cost of products sold	$	(0.5	)	$	(0.6	)
Fair value	Other income, net		(0.1	)		(1.1	)

Total		$	(0.6	)	$	(1.7	)

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2018

Carrying Value and Fair Value of Debt

The carrying value, net of underwriting commissions, price discounts, and debt issuance costs and fair value of debt as of March 31, 2018 and December 31, 2017 were as follows:


(In millions)	March 31, 2018				December 31, 2017
	Carrying Value		Fair Value		Carrying Value		Fair Value
Revolving credit facility	$	645.0	$	645.0	$	615.0	$	615.0
Term Loan		350.0		350.0		—		—
Senior Notes		893.0		908.2		892.6		926.3

Assets and Liabilities Measured at Fair Value on Recurring Basis

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017 were as follows:


(In millions)	Fair Value
	March 31, 2018		December 31, 2017
Assets
Derivative financial instruments (level 2)	$	2.8	$	1.0
Deferred compensation program assets (level 2)		7.8		7.5

Total assets	$	10.6	$	8.5

Liabilities
Derivative financial instruments (level 2)	$	2.7	$	6.4

Accumulated Other Comprehensive Loss (Tables)

3 Months Ended

Mar. 31, 2018

After-Tax Components of and Changes in Accumulated Other Comprehensive (Loss) Income

The after-tax components of and changes in accumulated other comprehensive (loss) income were as follows:


(In millions)	Foreign Currency Adjustments			Derivative Hedging Gain (Loss)			Defined Benefit Plan Adjustments^(a)			Accumulated Other Comprehensive Loss
Balance at December 31, 2016	$	(28.0	)	$	(0.6	)	$	(43.3	)	$	(71.9	)
Amounts classified into accumulated other comprehensive loss		6.8			1.6			—			8.4
Amounts reclassified from accumulated other comprehensive loss		—			0.6			(1.8	)		(1.2	)

Net current-period other comprehensive income (loss)		6.8			2.2			(1.8	)		7.2

Balance at March 31, 2017	$	(21.2	)	$	1.6		$	(45.1	)	$	(64.7	)
Balance at December 31, 2017	$	5.8		$	(2.4	)	$	(42.6	)	$	(39.2	)
Amounts classified into accumulated other comprehensive (income) loss		(0.8	)		3.5			0.2			2.9
Amounts reclassified from accumulated other comprehensive loss		—			0.3			—			0.3

Net current-period other comprehensive income (loss)		(0.8	)		3.8			0.2			3.2

Balance at March 31, 2018	$	5.0		$	1.4		$	(42.4	)	$	(36.0	)

^(a)

See Note 12, “Defined Benefit Plans,” for further information on the adjustments related to defined benefit plans.

Reclassifications Out of Accumulated Other Comprehensive Loss

The reclassifications out of accumulated other comprehensive loss for the three months ended March 31, 2018 and 2017 were as follows:


(In millions)
Details about Accumulated Other Comprehensive Loss Components	Amount Reclassified from Accumulated Other Comprehensive Loss Three Months Ended March 31,						Affected Line Item in the Statement of Comprehensive Income
	2018			2017
Losses on cash flow hedges
Foreign exchange contracts	$	(0.5	)	$	(0.6	)		Cost of products sold

		(0.5	)		(0.6	)		Total Before Tax
		0.2			—			Tax expense

	$	(0.3	)	$	(0.6	)		Net of tax
Defined benefit plan items
Recognition of prior service credits	$	—		$	3.0			^(a)

		—			3.0			Total before tax
		—			(1.2	)		Tax expense

	$	—		$	1.8			Net of tax

Total reclassifications for the period	$	(0.3	)	$	1.2			Net of tax

^(a)

These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost. Refer to Note 12, “Defined Benefit Plans,” for additional information.

Revenue (Tables)

3 Months Ended

Mar. 31, 2018

Disaggregation of Revenue


(In millions)
	Three Months Ended March 31,
	2018
Wholesalers ⁽¹⁾	$	585.6
Home Center retailers⁽²⁾		349.7
Other retailers ⁽³⁾		76.1
Builder direct		51.5

U.S. net sales		1,062.9
International ⁽⁴⁾		191.7

Net sales	$	1,254.6

(1)

Represents sales to customers whose business is oriented towards builders, professional trades and home remodelers, inclusive of sales through our customer’s respective internet website portals.

(2)

(3)

Represents sales principally to our mass merchant and standalone independent e-commerce customers.

(4)

Represents sales in markets outside the United States, principally in China, Canada, Europe and Mexico.

Defined Benefit Plans (Tables)

3 Months Ended

Mar. 31, 2018

Components of Net Periodic Benefit Cost for Pension and Postretirement Benefits

The components of net periodic benefit cost for pension and postretirement benefits for the three months ended March 31, 2018 and 2017 were as follows:


(In millions)	Three Months Ended March 31,
	Pension Benefits						Postretirement Benefits
	2018			2017			2018		2017
Service cost	$	0.2		$	0.1		$	—	$	—
Interest cost		7.6			8.4			—		—
Expected return on plan assets		(10.3	)		(9.3	)		—		—
Recognition of prior service credits		—			—			—		(3.0	)

Net periodic benefit income	$	(2.5	)	$	(0.8	)	$	—	$	(3.0	)

Accounting Standards Update 2017-07 [Member]

Schedule of Retrospective Impact of Adopting ASU 2017-07

The retrospective impact of adopting ASU 2017-07 on the three months ended March 31, 2017 was as follows:


(In millions)
	Three Months Ended March 31,
	2017
Increase/(decrease) to cost of products sold	$	2.9
Increase/(decrease) to selling, general and administrative expenses		1.0

Increase/(decrease) to operating income	$	(3.9	)

Product Warranties (Tables)

3 Months Ended

Mar. 31, 2018

The following table summarizes activity related to our product warranty liability for the three months ended March 31, 2018 and 2017, respectively.


(In millions)	Three Months Ended March 31,
	2018			2017
Reserve balance at January 1,	$	17.2		$	16.2
Provision for warranties issued		6.2			8.2
Settlements made (in cash or in kind)		(6.2	)		(8.5	)

Reserve balance at March 31,	$	17.2		$	15.9

Information on Business Segments (Tables)

3 Months Ended

Mar. 31, 2018

Net Sales and Operating Income by Segment

Net sales and operating income for the three months ended March 31, 2018 and 2017 by segment were as follows:


	Three Months Ended March 31,
(In millions)	2018			2017			% Change vs. Prior Year
Net Sales
Cabinets	$	557.2		$	573.6			(2.9	)%
Plumbing		449.7			378.4			18.8
Doors		110.3			102.2			7.9
Security		137.4			132.6			3.6

Net sales	$	1,254.6		$	1,186.8			5.7	%

Operating Income (Loss)
Cabinets	$	24.1		$	47.0			(48.7	)%
Plumbing ^(a)		88.4			67.2			31.5
Doors		13.1			8.2			59.8
Security		15.1			10.1			49.5
Less: Corporate expenses ^(a)		(21.3	)		(21.5	)		0.9

Operating income	$	119.4		$	111.0			7.6	%

Corporate expenses ^(a)
General and administrative expense	$	(21.3	)	$	(21.5	)

Total Corporate expenses	$	(21.3	)	$	(21.5	)		0.9

^(a)

We revised our previously reported results for the three months ended March 31, 2017 for ASU 2017-07, Presentation of Net Periodic Pension and Postretirement Costs.

Restructuring and Other Charges (Tables)

3 Months Ended

Mar. 31, 2018

Pre-tax Restructuring and Other Charges

Pre-tax restructuring and other charges for the three months ended March 31, 2018 and 2017 are shown below.


(In millions)	Three Months Ended March 31, 2018
	Restructuring Charges			Other Charges ^(a)			Total Charges
Cabinets	$	0.3		$	(0.2	)	$	0.1
Plumbing		(0.2	)		—			(0.2	)
Security		—			0.1			0.1
Doors		0.7			—			0.7

Total	$	0.8		$	(0.1	)	$	0.7

Restructuring and other charges in the first quarter of 2018 largely related to severance costs within our Doors and Cabinets segments.


(In millions)	Three Months Ended March 31, 2017
	Restructuring Charges			Other Charges ^(a)		Total Charges
Plumbing	$	1.4		$	—	$	1.4
Doors		(0.2	)		—		(0.2	)
Security		1.0			0.7		1.7

Total	$	2.2		$	0.7	$	2.9

^(a)

Reconciliation of Restructuring Liability


(In millions)	Balance at 12/31/17		2018 Provision		Cash Expenditures ^(a)			Non-Cash Write-offs ^(b)			Balance at 3/31/18
Workforce reduction costs	$	5.0	$	0.8	$	(2.0	)	$	—		$	3.8
Other		0.8		—		—			(0.3	)		0.5

	$	5.8	$	0.8	$	(2.0	)	$	(0.3	)	$	4.3

^(a)

Cash expenditures primarily related to severance charges.

^(b)

Non-cash write-offs include long-lived asset impairment charges attributable to restructuring actions.


(In millions)	Balance at 12/31/16		2017 Provision		Cash Expenditures ^(a)			Non-Cash Write-offs ^(b)		Balance at 3/31/17
Workforce reduction costs	$	2.4	$	1.9	$	(1.0	)	$	—	$	3.3
Other		0.6		0.3		(0.6	)		—		0.3

	$	3.0	$	2.2	$	(1.6	)	$	—	$	3.6

^(a)

Cash expenditures primarily related to severance charges.

^(b)

Non-cash write-offs include long-lived asset impairment charges attributable to restructuring actions.

Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2018

Computations of Earnings per Common Share

The computations of earnings per common share for the three months ended March 31, 2018 and 2017 were as follows:


(In millions, except per share data)	Three Months Ended March 31,
	2018			2017
Income from continuing operations, net of tax	$	75.1		$	77.4
Less: Noncontrolling interest		(0.1	)		—

Income from continuing operations for EPS		75.2			77.4
Loss from discontinued operations		(0.2	)		—

Net income attributable to Fortune Brands	$	75.0		$	77.4

Earnings per common share
Basic
Continuing operations	$	0.50		$	0.50
Discontinued operations		—			—

Net income attributable to Fortune Brands common stockholders	$	0.50		$	0.50
Diluted
Continuing operations	$	0.49		$	0.50
Discontinued operations		—			—

Net income attributable to Fortune Brands common stockholders	$	0.49		$	0.50
Basic average shares outstanding		149.9			153.3
Stock-based awards		2.2			2.9

Diluted average shares outstanding		152.1			156.2
Antidilutive stock-based awards excluded from weighted-average number of shares outstanding for diluted earnings per share		0.5			0.6

Balance Sheet Information - Supplemental Information on Balance Sheets (Detail) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Inventories:
Raw materials and supplies	$ 233.8	$ 224.9
Work in process	62.6	58.3
Finished products	322.8	297.6
Total inventories	619.2	580.8
Property, plant and equipment, gross	1,803.8	1,780.4
Less: accumulated depreciation	1,061.0	1,040.4
Property, plant and equipment, net	$ 742.8	$ 740.0

Acquisitions and Dispositions - Additional Information (Detail) $ in Millions	3 Months Ended
	Mar. 31, 2018 USD ($)
Victoria Plus Albert and Shaws [Member]
Acquisitions and Dispositions [Line Items]
Business acquisition consideration price paid	$ 132

Goodwill and Identifiable Intangible Assets - Additional Information (Detail)
$ in Millions

3 Months Ended

12 Months Ended

Mar. 31, 2018

USD ($)

Dec. 31, 2017

USD ($)

asset_group

Other intangible assets, net of accumulated amortization

^[1]

$ 1,918.7

$ 1,912.0

1,151.2

1,162.4

Decrease in gross identifiable intangible assets

(3.3)

Carrying value of tradenames

709.2

709.9

Victoria Plus Albert [Member]

Additional purchase price consideration paid

5.8

Plumbing [Member]

Goodwill increase due to foreign exchange adjustments

^[1]

752.6

745.2

6.7

Cabinets [Member]

Number of tradenames, with the fair value exceeded their carrying value | asset_group

^[1]

$ 926.1

$ 926.3

Carrying value of tradenames

$ 217.8

Minimum [Member] | Tradenames and Customer Relationship [Member]

Amortizable identifiable intangible assets, estimated useful life

2 years

Maximum [Member] | Cabinets [Member] | Tradenames [Member]

Percentage of fair value of reporting unit in excess of carrying amount

10.00%

Maximum [Member] | Tradenames and Customer Relationship [Member]

Amortizable identifiable intangible assets, estimated useful life

20 years

[1]	Net of accumulated impairment losses of $399.5 million in the Doors segment.

Goodwill and Identifiable Intangible Assets - Change in Net Carrying Amount of Goodwill by Segment (Detail)
$ in Millions

3 Months Ended

Mar. 31, 2018

USD ($)

$ 1,912.0

^[1]

Acquisition-related adjustments

(1.8)

8.5

1,918.7

^[1]

Cabinets [Member]

926.3

^[1]

(0.2)

926.1

^[1]

Plumbing [Member]

745.2

^[1]

Acquisition-related adjustments

(1.1)

8.5

752.6

^[1]

Doors [Member]

143.0

^[1]

143.0

^[1]

Security [Member]

97.5

^[1]

(0.5)

Accumulated Other Comprehensive Income (Loss) [Line Items]

$ 97.0

^[1]

[1]	Net of accumulated impairment losses of $399.5 million in the Doors segment.

Goodwill and Identifiable Intangible Assets - Change in Net Carrying Amount of Goodwill by Segment (Parenthetical) (Detail) $ in Millions	Mar. 31, 2018 USD ($)
Doors [Member]
Goodwill [Line Items]
Accumulated impairment losses	$ 399.5

Goodwill and Identifiable Intangible Assets - Gross Carrying Value and Accumulated Amortization by Class of Identifiable Intangible Assets (Detail) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Intangible Assets [Line Items]
Gross Carrying Amounts, Total identifiable intangibles	$ 1,446.3	$ 1,449.6
Accumulated Amortization, Total identifiable intangibles	(295.1)	(287.2)
Net Book Value, Total identifiable intangibles	1,151.2	1,162.4
Gross Carrying Amounts, Indefinite-lived tradenames	709.2	709.9
Net Book Value, Indefinite-lived tradenames	709.2	709.9
Gross Carrying Amounts, Finite Lived	737.1	739.7
Accumulated Amortization, Finite Lived	(295.1)	(287.2)
Net Book Value, Finite Lived	442.0	452.5
Tradenames [Member]
Intangible Assets [Line Items]
Gross Carrying Amounts, Finite Lived	15.7	15.7
Accumulated Amortization, Finite Lived	(10.4)	(9.9)
Net Book Value, Finite Lived	5.3	5.8
Customer and contractual relationships [Member]
Intangible Assets [Line Items]
Gross Carrying Amounts, Finite Lived	661.1	663.8
Accumulated Amortization, Finite Lived	(238.8)	(232.0)
Net Book Value, Finite Lived	422.3	431.8
Patents/proprietary technology [Member]
Intangible Assets [Line Items]
Gross Carrying Amounts, Finite Lived	60.3	60.2
Accumulated Amortization, Finite Lived	(45.9)	(45.3)
Net Book Value, Finite Lived	$ 14.4	$ 14.9

Asset Impairment - Additional information (Detail) $ in Millions	3 Months Ended
	Mar. 31, 2017 USD ($)
Asset Impairment Charges [Line Items]
Asset impairment charge	$ 3.2
Definite-lived intangible assets	3.0
Fixed Assets	$ 0.2

External Debt and Financing Arrangements - Additional Information (Detail) - USD ($)	1 Months Ended	3 Months Ended
	Jun. 30, 2015	Mar. 31, 2018	Dec. 31, 2017	Jun. 30, 2016
Debt Instrument [Line Items]
Term loan maturity period		2019-03
Revolving credit facility, extended expiration date		2021-06
Uncommitted bank lines of credit, which provide for unsecured borrowings for working capital		$ 23,500,000	$ 23,500,000
Uncommitted bank lines of credit, which provide for unsecured borrowings for working capital amount outstanding		$ 0	0
LIBOR [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Interest rate over LIBOR		0.90%
LIBOR [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Interest rate over LIBOR		1.50%
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Term loan, outstanding borrowings		$ 645,000,000	615,000,000
Current portion of long-term debt		0	0
Term Loan Facility [Member]
Debt Instrument [Line Items]
Senior unsecured notes, price		$ 350,000,000
Term Loan Facility [Member] \| LIBOR [Member] \| Minimum [Member]
Debt Instrument [Line Items]
Interest rate over LIBOR		0.625%
Term Loan Facility [Member] \| LIBOR [Member] \| Maximum [Member]
Debt Instrument [Line Items]
Interest rate over LIBOR		1.25%
Amended and Restated Credit Agreement [Member] \| Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity				$ 1,250,000,000
Senior Unsecured Notes [Member]
Debt Instrument [Line Items]
Senior unsecured notes, price	$ 900,000,000
Senior notes, outstanding amount		$ 893,000,000	$ 892,600,000
Senior Unsecured Notes [Member] \| Notes Due 2020 [Member]
Debt Instrument [Line Items]
Senior unsecured notes, price	$ 400,000,000
Senior unsecured notes, maturity period	5 years
Senior unsecured notes, maturity year	2020
Senior unsecured notes, coupon rate	3.00%
Senior Unsecured Notes [Member] \| Notes Due 2025 [Member]
Debt Instrument [Line Items]
Senior unsecured notes, price	$ 500,000,000
Senior unsecured notes, maturity period	10 years
Senior unsecured notes, maturity year	2025
Senior unsecured notes, coupon rate	4.00%

Financial Instruments - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Derivative [Line Items]
Estimated amount of net foreign currency derivative gains in other comprehensive income reclassified to earnings within 12 months	$ 1,900,000
Foreign exchange contracts [Member]
Derivative [Line Items]
Notional amount of foreign currency derivative hedges	304,300,000
Cash flow hedge [Member]
Derivative [Line Items]
Net gains recognized in OCI	$ 4,300,000	$ 2,100,000

Financial Instruments - Fair Values of Derivative Instruments (Detail) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Derivatives, Fair Value [Line Items]
Derivative assets, fair value	$ 2.8	$ 1.0
Derivative liabilities, fair value	2.7	6.4
Net investment hedges [Member] \| Other current liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liabilities, fair value	1.1	0.8
Foreign exchange contracts [Member] \| Other current assets [Member]
Derivatives, Fair Value [Line Items]
Derivative assets, fair value	2.8	0.8
Foreign exchange contracts [Member] \| Other current liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative liabilities, fair value	$ 1.6	5.6
Commodity Contracts [Member] \| Other current assets [Member]
Derivatives, Fair Value [Line Items]
Derivative assets, fair value		$ 0.2

Financial Instruments - Effects of Derivative Financial Instruments on Consolidated Statements of Income (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Derivative Instruments, Gain (Loss) [Line Items]
(Loss) Gain Recognized in Income	$ (0.6)	$ (1.7)
Cash flow hedge [Member] \| Cost of products sold [Member]
Derivative Instruments, Gain (Loss) [Line Items]
(Loss) Gain Recognized in Income	(0.5)	(0.6)
Fair value hedge [Member] \| Other income, net [Member]
Derivative Instruments, Gain (Loss) [Line Items]
(Loss) Gain Recognized in Income	$ (0.1)	$ (1.1)

Fair Value Measurements - Additional Information (Detail)	Mar. 31, 2018 USD ($)
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Assets or liabilities measured at fair value on recurring basis	$ 0

Fair Value Measurements - Carrying Value and Fair Value of Debt (Detail) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Carrying Value \| Term Loan Facility [Member]
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Fair Value	$ 350.0
Carrying Value \| Senior Unsecured Notes [Member]
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Fair Value	893.0	$ 892.6
Carrying Value \| Revolving Credit Facility [Member]
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Fair Value	645.0	615.0
Fair Value \| Term Loan Facility [Member]
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Fair Value	350.0
Fair Value \| Senior Unsecured Notes [Member]
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Fair Value	908.2	926.3
Fair Value \| Revolving Credit Facility [Member]
Fair Value Inputs, Liabilities, Quantitative Information [Line Items]
Fair Value	$ 645.0	$ 615.0

Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative financial instruments (level 2)	$ 2.8	$ 1.0
Fair Value, Measurements, Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets	10.6	8.5
Fair Value, Measurements, Recurring [Member] \| Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative financial instruments (level 2)	2.8	1.0
Deferred compensation program assets (level 2)	7.8	7.5
Derivative financial instruments (level 2)	$ 2.7	$ 6.4

Accumulated Other Comprehensive Loss - After-Tax Components of and Changes in Accumulated Other Comprehensive (Loss) Income (Detail) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

$ 2,601.1

$ 2,363.0

3.2

7.2

Foreign Currency Adjustments [Member]

2,358.3

2,430.7

Accumulated Other Comprehensive Income (Loss) [Line Items]

Amounts classified into accumulated other comprehensive (income) loss

5.8

(28.0)

(0.8)

6.8

(0.8)

6.8

Derivative Hedging Gains (Loss) [Member]

5.0

(21.2)

Accumulated Other Comprehensive Income (Loss) [Line Items]

Amounts classified into accumulated other comprehensive (income) loss

(2.4)

(0.6)

3.5

1.6

Amounts reclassified from accumulated other comprehensive loss

0.3

0.6

3.8

2.2

Defined benefit plan items [Member]

1.4

1.6

Accumulated Other Comprehensive Income (Loss) [Line Items]

Amounts classified into accumulated other comprehensive (income) loss

^[1]

(42.6)

(43.3)

^[1]

0.2

Amounts reclassified from accumulated other comprehensive loss

^[1]

(1.8)

^[1]

0.2

(1.8)

Accumulated Other Comprehensive (Loss) Income [Member]

^[1]

(42.4)

(45.1)

Accumulated Other Comprehensive Income (Loss) [Line Items]

Amounts classified into accumulated other comprehensive (income) loss

(39.2)

(71.9)

2.9

8.4

Amounts reclassified from accumulated other comprehensive loss

0.3

(1.2)

3.2

7.2

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

$ (36.0)

$ (64.7)

[1]	See Note 12, "Defined Benefit Plans," for further information on the adjustments related to defined benefit plans.

Accumulated Other Comprehensive Loss - Reclassifications Out of Accumulated Other Comprehensive Loss (Detail) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

Cost of products sold

$ 815.0

$ 772.7

Derivative Hedging Gains (Loss) [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Reclassification from Accumulated Other Comprehensive Income (Loss), Current Period, Net of Tax

(0.3)

(0.6)

Defined benefit plan items [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Reclassification from Accumulated Other Comprehensive Income (Loss), Current Period, Net of Tax

^[1]

1.8

Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Reclassification from Accumulated Other Comprehensive Income (Loss), Current Period, Net of Tax

(0.3)

1.2

Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Derivative Hedging Gains (Loss) [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax

(0.5)

(0.6)

Reclassification from AOCI, Current Period, Tax

0.2

Reclassification from Accumulated Other Comprehensive Income (Loss), Current Period, Net of Tax

(0.3)

(0.6)

Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Derivative Hedging Gains (Loss) [Member] | Foreign exchange contracts [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Cost of products sold

$ (0.5)

(0.6)

Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Prior service cost [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax

^[2]

3.0

Reclassification out of Accumulated Other Comprehensive Income (Loss) [Member] | Defined benefit plan items [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax

3.0

Reclassification from AOCI, Current Period, Tax

(1.2)

Reclassification from Accumulated Other Comprehensive Income (Loss), Current Period, Net of Tax

$ 1.8

[1]	See Note 12, "Defined Benefit Plans," for further information on the adjustments related to defined benefit plans.
[2]	These accumulated other comprehensive loss components are included in the computation of net periodic benefit cost. Refer to Note 12, "Defined Benefit Plans," for additional information.

Revenue - Additional Information (Detail) $ in Millions	3 Months Ended
Revenue - Additional Information (Detail) $ in Millions	Mar. 31, 2018 USD ($)
Disaggregation of Revenue [Line Items]
Payment term on product sales range, description	Payment terms on our product sales range from 30 to 90 days.
Other current liabilities [Member]
Disaggregation of Revenue [Line Items]
Refund obligation	$ 11.7

Revenue - Disaggregation of Revenue (Detail) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

$ 1,254.6

$ 1,186.8

Wholesalers [Member]

Home Center Retailers [Member]

^[1]

585.6

^[2]

349.7

Other Retailers [Member]

^[3]

76.1

Builder Direct [Member]

51.5

United States [Member]

1,062.9

International [Member]

Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]

^[4]

$ 191.7

[1]	Represents sales to customers whose business is oriented towards builders, professional trades and home remodelers, inclusive of sales through our customer's respective internet website portals.
[2]	Represents sales to the three largest "Do-It-Yourself" retailers; The Home Depot, Inc., Lowes Companies, Inc. and Menards, Inc, inclusive of sales through their respective internet website portals.
[3]	Represents sales principally to our mass merchant and standalone independent e-commerce customers.
[4]	Represents sales in markets outside the United States, principally in China, Canada, Europe and Mexico.

Defined Benefit Plans - Components of Net Periodic Benefit Cost for Pension and Postretirement Benefits (Detail) - Net Periodic Benefit Cost - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Pension Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 0.2	$ 0.1
Interest cost	7.6	8.4
Expected return on plan assets	(10.3)	(9.3)
Net periodic benefit income	$ (2.5)	(0.8)
Postretirement Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Recognition of prior service credits		(3.0)
Net periodic benefit income		$ (3.0)

Defined Benefit Plans - Additional Information (Detail) $ in Millions	1 Months Ended
	Mar. 31, 2017 USD ($)
Accounting Standards Update 2017-07 [Member]
Defined Benefit Plan Disclosure [Line Items]
Reclassifications from operating income to other income	$ 3.9

Defined Benefit Plans - Schedule of Retrospective Impact of Adopting ASU 2017-07 (Detail) - Accounting Standards Update 2017-07 [Member] $ in Millions	3 Months Ended
	Mar. 31, 2017 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase/(decrease) to operating income	$ (3.9)
Cost of products sold [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase/(decrease) to operating income	2.9
Selling, general and administrative Expenses [Member]
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Increase/(decrease) to operating income	$ 1.0

Income Taxes - Additional Information (Detail) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Income Taxes [Line Items]
Effective income tax rate	30.10%	25.40%
Reduction in corporate tax rate	21.00%		35.00%
Adjustment to income tax expense	$ 5,400,000
Minimum [Member]
Income Taxes [Line Items]
Reasonably possible decrease in unrecognized tax benefits	2,000,000
Maximum [Member]
Income Taxes [Line Items]
Reasonably possible decrease in unrecognized tax benefits	$ 22,000,000

Product Warranties - Activity Related to Product Warranty Liability (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Product Warranty Liability [Line Items]
Reserve balance at the beginning of the year	$ 17.2	$ 16.2
Provision for warranties issued	6.2	8.2
Settlements made (in cash or in kind)	(6.2)	(8.5)
Reserve balance at end of year	$ 17.2	$ 15.9

Information on Business Segments - Net Sales and Operating Income by Segment (Detail) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

$ 1,254.6

$ 1,186.8

$ 119.4

111.0

Operating Income (Loss), Percentage Change vs. Prior Year

5.70%

7.60%

Corporate [Member]

Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]

General and administrative expense

^[1]

$ (21.3)

(21.5)

^[1]

(21.3)

(21.5)

Total Corporate expenses

^[1]

$ (21.3)

(21.5)

Operating Income (Loss), Percentage Change vs. Prior Year

^[1]

0.90%

Total Corporate expenses, Percentage Change vs. Prior Year

^[1]

0.90%

Cabinets [Member] | Operating Segments [Member]

Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]

$ 557.2

573.6

$ 24.1

47.0

Operating Income (Loss), Percentage Change vs. Prior Year

(2.90%)

(48.70%)

Plumbing [Member] | Operating Segments [Member]

Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]

$ 449.7

378.4

^[1]

$ 88.4

67.2

Operating Income (Loss), Percentage Change vs. Prior Year

18.80%

^[1]

31.50%

Doors [Member] | Operating Segments [Member]

Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]

$ 110.3

102.2

$ 13.1

8.2

Operating Income (Loss), Percentage Change vs. Prior Year

7.90%

59.80%

Security [Member] | Operating Segments [Member]

Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]

$ 137.4

132.6

$ 15.1

$ 10.1

Operating Income (Loss), Percentage Change vs. Prior Year

3.60%

49.50%

[1]	We revised our previously reported results for the three months ended March 31, 2017 for ASU 2017-07, Presentation of Net Periodic Pension and Postretirement Costs.

Restructuring and Other Charges - Pre-tax Restructuring and Other Charges (Detail) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

$ 0.8

$ 2.2

Other Charges

^[1]

(0.1)

0.7

Operating Segments [Member] | Cabinets [Member]

0.7

2.9

0.3

Other Charges

^[1]

(0.2)

Operating Segments [Member] | Plumbing [Member]

0.1

(0.2)

1.4

Operating Segments [Member] | Security [Member]

(0.2)

1.4

1.0

Other Charges

^[1]

0.1

0.7

Operating Segments [Member] | Doors [Member]

0.1

1.7

0.7

(0.2)

$ 0.7

$ (0.2)

[1]

"Other Charges" represent charges directly related to restructuring initiatives that cannot be reported as restructuring under GAAP. Such costs may include losses on disposal of inventories, trade receivables allowances from exiting product lines, accelerated depreciation resulting from the closure of facilities and gains or losses on the sale of previously closed facilities.

Restructuring and Other Charges - Reconciliation of Restructuring Liability (Detail) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2018

Mar. 31, 2017

$ 5.8

$ 3.0

Provision

0.8

2.2

Cash Expenditures

^[1]

(2.0)

(1.6)

Non-Cash Write-offs

^[2]

(0.3)

Workforce Reduction Costs [Member]

4.3

3.6

5.0

2.4

Provision

0.8

1.9

Cash Expenditures

^[1]

(2.0)

(1.0)

3.8

3.3

Other [Member]

0.8

0.6

Provision

0.3

Cash Expenditures

^[1]

(0.6)

Non-Cash Write-offs

^[2]

(0.3)