10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)                                                                                                                                                                                                                       

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

For the quarterly period ended June 30, 2023

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 No. 1-9328

ECOLAB INC.

(Exact name of registrant as specified in its charter)

Delaware	41-0231510
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

1 Ecolab Place, St. Paul, Minnesota 55102

(Address of principal executive offices)(Zip Code)

1-800-232-6522

(Registrant’s telephone number, including area code)

(Not applicable)

(Former name, former address and former fiscal year,

if changed since last report)

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, $1.00 par value 2.625% Euro Notes due 2025 1.000% Euro Notes due 2024	ECL ECL 25 ECL 24	New York Stock Exchange New York Stock Exchange New York Stock Exchange

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, a 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 ⌧

The number of shares of each of the registrant’s classes of Common Stock outstanding as of June 30, 2023: 285,033,916 shares, par value $1.00 per share.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions, except per share amounts)	2023		2022		2023		2022
Product and equipment sales		$3,104.8		$2,886.8		$5,981.1		$5,510.9
Service and lease sales		747.3		693.8		1,442.6		1,336.4
Net sales		3,852.1		3,580.6		7,423.7		6,847.3
Product and equipment cost of sales		1,895.3		1,799.0		3,693.6		3,494.6
Service and lease cost of sales		439.5		412.1		846.4		789.9
Cost of sales (including special charges (a))		2,334.8		2,211.1		4,540.0		4,284.5
Selling, general and administrative expenses		1,011.6		940.1		2,001.9		1,854.8
Special (gains) and charges		21.0		3.6		45.5		27.7
Operating income		484.7		425.8		836.3		680.3
Other (income) expense		(14.4)		(19.5)		(27.5)		(38.3)
Interest expense, net		77.8		56.0		152.0		109.0
Income before income taxes		421.3		389.3		711.8		609.6
Provision for income taxes		86.6		76.6		139.0		122.2
Net income including noncontrolling interest		334.7		312.7		572.8		487.4
Net income attributable to noncontrolling interest		5.0		4.4		9.7		7.2
Net income attributable to Ecolab		$329.7		$308.3		$563.1		$480.2
Earnings attributable to Ecolab per common share
Basic		$ 1.16		$ 1.08		$ 1.98		$ 1.68
Diluted		$ 1.15		$ 1.08		$ 1.97		$ 1.67
Weighted-average common shares outstanding
Basic		284.9		285.1		284.8		285.7
Diluted		286.3		286.6		286.1		287.4

(a) Cost of sales includes special (gains) and charges of $8.1 and $1.7 in the second quarter of 2023 and 2022, respectively, and $11.3 and $54.6 in the first six months of 2023 and 2022, respectively, which is recorded in product and equipment cost of sales and service and lease cost of sales.

The accompanying notes are an integral part of the consolidated financial statements.

2

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited)

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Net income including noncontrolling interest		$334.7		$312.7		$572.8		$487.4
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments
Foreign currency translation		3.0		(162.7)		14.1		(120.5)
(Loss) gain on net investment hedges		(23.8)		71.4		(40.5)		90.3
Total foreign currency translation adjustments		(20.8)		(91.3)		(26.4)		(30.2)
Derivatives and hedging instruments		(1.5)		6.1		(6.2)		1.5
Pension and postretirement benefits		(4.3)		28.0		(4.1)		41.7
Subtotal		(26.6)		(57.2)		(36.7)		13.0
Total comprehensive income, including noncontrolling interest		308.1		255.5		536.1		500.4
Comprehensive income attributable to noncontrolling interest		3.0		1.5		8.2		3.3
Comprehensive income attributable to Ecolab		$305.1		$254.0		$527.9		$497.1

The accompanying notes are an integral part of the consolidated financial statements.

3

CONSOLIDATED BALANCE SHEETS

(unaudited)

	June 30		December 31
(millions, except per share amounts)	2023		2022
ASSETS
Current assets
Cash and cash equivalents		$554.2		$598.6
Accounts receivable, net		2,780.1		2,698.1
Inventories		1,646.2		1,792.8
Other current assets		456.0		404.7
Total current assets		5,436.5		5,494.2
Property, plant and equipment, net		3,326.5		3,293.4
Goodwill		8,101.3		8,012.7
Other intangible assets, net		3,603.6		3,680.7
Operating lease assets		446.8		448.2
Other assets		541.5		535.1
Total assets		$21,456.2		$21,464.3
LIABILITIES AND EQUITY
Current liabilities
Short-term debt		$1,121.9		$505.1
Accounts payable		1,476.8		1,728.2
Compensation and benefits		469.1		493.6
Income taxes		117.3		197.6
Other current liabilities		1,282.4		1,285.9
Total current liabilities		4,467.5		4,210.4
Long-term debt		7,499.6		8,075.3
Pension and postretirement benefits		660.8		670.3
Deferred income taxes		474.1		505.6
Operating lease liabilities		335.4		337.8
Other liabilities		438.3		406.3
Total liabilities		13,875.7		14,205.7
Commitments and contingencies (Note 16)
Equity (a)
Common stock		365.3		364.7
Additional paid-in capital		6,684.1		6,580.2
Retained earnings		9,580.0		9,318.8
Accumulated other comprehensive loss		(1,761.8)		(1,726.6)
Treasury stock		(7,310.9)		(7,301.0)
Total Ecolab shareholders’ equity		7,556.7		7,236.1
Noncontrolling interest		23.8		22.5
Total equity		7,580.5		7,258.6
Total liabilities and equity		$21,456.2		$21,464.3

(a) Common stock, 800.0 shares authorized, $1.00 par value per share, 285.0 shares outstanding as of June 30, 2023 and 284.5 shares outstanding as of December 31, 2022. Shares outstanding are net of treasury stock.

The accompanying notes are an integral part of the consolidated financial statements.

4

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

	Six Months Ended
	June 30
(millions)	2023		2022
OPERATING ACTIVITIES
Net income including noncontrolling interest		$572.8		$487.4
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation		311.3		311.2
Amortization		152.4		158.2
Deferred income taxes		(36.8)		(57.6)
Share-based compensation expense		58.7		52.8
Pension and postretirement plan contributions		(29.0)		(35.1)
Pension and postretirement plan expense (income), net		4.3		(2.7)
Restructuring charges, net of cash paid		(26.3)		(13.4)
Other, net		13.2		10.1
Changes in operating assets and liabilities, net of effect of acquisitions:
Accounts receivable		(52.8)		(234.0)
Inventories		150.9		(250.8)
Other assets		19.2		(43.2)
Accounts payable		(264.7)		163.8
Other liabilities		(101.6)		(54.2)
Cash provided by operating activities		771.6		492.5
INVESTING ACTIVITIES
Capital expenditures		(345.7)		(317.5)
Property and other assets sold		8.6		0.7
Acquisitions and investments in affiliates, net of cash acquired		(105.0)		(7.2)
Other, net		(21.4)		13.2
Cash used for investing activities		(463.5)		(310.8)
FINANCING ACTIVITIES
Net issuances of commercial paper and notes payable		1.7		208.0
Reacquired shares		(10.9)		(402.8)
Dividends paid		(308.6)		(300.1)
Exercise of employee stock options		50.6		12.7
Hedge settlements		(53.5)		55.4
Other, net		(1.5)		(1.4)
Cash used for financing activities		(322.2)		(428.2)
Effect of exchange rate changes on cash and cash equivalents		(30.3)		11.5
Decrease in cash and cash equivalents		(44.4)		(235.0)
Cash and cash equivalents, beginning of period		598.6		359.9
Cash and cash equivalents, end of period		$554.2		$124.9

The accompanying notes are an integral part of the consolidated financial statements.

5

CONSOLIDATED STATEMENTS OF EQUITY

(unaudited)

	Second Quarter Ended June 30, 2023 and 2022
(millions, except per share amounts)	Common Stock		Additional Paid-in Capital		Retained Earnings		AOCI (Loss)		Treasury Stock		Ecolab Shareholders' Equity		Non-Controlling Interest		Total Equity
Balance, March 31, 2022		$364.5		$6,501.5		$8,840.4		($1,563.6)		($7,061.2)		$7,081.6		$23.5		$7,105.1
Net income						308.3						308.3		4.4		312.7
Other comprehensive income (loss) activity								(54.3)				(54.3)		(2.9)		(57.2)
Cash dividends declared (a)						(145.4)						(145.4)				(145.4)
Stock options and awards		-		28.3						0.6		28.9				28.9
Reacquired shares										(125.7)		(125.7)				(125.7)
Balance, June 30, 2022		$364.5		$6,529.8		$9,003.3		($1,617.9)		($7,186.3)		$7,093.4		$25.0		$7,118.4
Balance, March 31, 2023		$365.0		$6,626.5		$9,401.3		($1,737.2)		($7,311.4)		$7,344.2		$20.8		$7,365.0
Net income						329.7						329.7		5.0		334.7
Other comprehensive income (loss) activity								(24.6)				(24.6)		(2.0)		(26.6)
Cash dividends declared (a)						(151.0)						(151.0)				(151.0)
Changes in noncontrolling interests				(4.5)								(4.5)				(4.5)
Stock options and awards		0.3		62.1						0.8		63.2				63.2
Reacquired shares										(0.3)		(0.3)				(0.3)
Balance, June 30, 2023		$365.3		$6,684.1		$9,580.0		($1,761.8)		($7,310.9)		$7,556.7		$23.8		$7,580.5
	Six Months Ended June 30, 2023 and 2022
(millions, except per share amounts)	Common Stock		Additional Paid-in Capital		Retained Earnings		OCI (Loss)		Treasury Stock		Ecolab Shareholders' Equity		Non-Controlling Interest		Total Equity
Balance, December 31, 2021		$364.1		$6,464.6		$8,814.5		($1,634.8)		($6,784.2)		$7,224.2		$28.9		$7,253.1
Net income						480.2						480.2		7.2		487.4
Other comprehensive income (loss) activity								16.9				16.9		(3.9)		13.0
Cash dividends declared (a)						(291.4)						(291.4)		(7.8)		(299.2)
Fair value adjustment of prior acquisition												-		0.6		0.6
Stock options and awards		0.4		65.2						0.7		66.3				66.3
Reacquired shares										(402.8)		(402.8)				(402.8)
Balance, June 30, 2022		$364.5		$6,529.8		$9,003.3		($1,617.9)		($7,186.3)		$7,093.4		$25.0		$7,118.4
Balance, December 31, 2022		$364.7		$6,580.2		$9,318.8		($1,726.6)		($7,301.0)		$7,236.1		$22.5		$7,258.6
Net income						563.1						563.1		9.7		572.8
Other comprehensive income (loss) activity								(35.2)				(35.2)		(1.5)		(36.7)
Cash dividends declared (a)						(301.9)						(301.9)		(6.9)		(308.8)
Changes in noncontrolling interests				(4.5)								(4.5)				(4.5)
Stock options and awards		0.6		108.4						1.0		110.0				110.0
Reacquired shares										(10.9)		(10.9)				(10.9)
Balance, June 30, 2023		$365.3		$6,684.1		$9,580.0		($1,761.8)		($7,310.9)		$7,556.7		$23.8		$7,580.5

(a) Dividends declared per common share were $0.53 and $0.51 in the second quarter of 2023 and 2022, respectively, and $1.06 and $1.02 in the first six months of 2023 and 2022, respectively.

The accompanying notes are an integral part of the consolidated financial statements.

6

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. CONSOLIDATED FINANCIAL INFORMATION

The unaudited consolidated financial information for the second quarter ended June 30, 2023 and 2022 reflects, in the opinion of management, all adjustments necessary for a fair statement of the financial position, results of operations, comprehensive income, equity and cash flows of Ecolab Inc. ("Ecolab" or "the Company") for the interim periods presented. Any adjustments consist of normal recurring items.

The financial results for any interim period are not necessarily indicative of results for the full year. The consolidated balance sheet data as of December 31, 2022 was derived from the audited consolidated financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited consolidated financial information should be read in conjunction with the consolidated financial statements and notes thereto incorporated in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (“SEC”) on February 24, 2023.

With respect to the unaudited financial information of the Company for the second quarter ended June 30, 2023 and 2022 included in this Form 10-Q, PricewaterhouseCoopers LLP reported that they have applied limited procedures in accordance with professional standards for a review of such information. Their separate report dated August 3, 2023 appearing herein states that they did not audit and they do not express an opinion on that unaudited financial information. Accordingly, the degree of reliance on their report on such information should be restricted in light of the limited nature of the review procedures applied. PricewaterhouseCoopers LLP is not subject to the liability provisions of Section 11 of the Securities Act of 1933, as amended (the "Act"), for their report on the unaudited financial information because that report is not a "report" or a "part" of a registration statement prepared or certified by PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11 of the Act.

2. SPECIAL (GAINS) AND CHARGES

Special (gains) and charges reported on the Consolidated Statements of Income include the following:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Cost of sales
Restructuring activities		$8.1		$0.8		$11.3		$3.4
Acquisition and integration activities		-		0.9		-		28.5
Russia/Ukraine		-		-		-		6.4
Other		-		-		-		16.3
Cost of sales subtotal		8.1		1.7		11.3		54.6
Special (gains) and charges
Restructuring activities		13.7		0.3		26.3		1.1
Acquisition and integration activities		3.5		3.4		8.5		10.9
Russia/Ukraine		0.3		(5.7)		0.6		5.9
Other		3.5		5.6		10.1		9.8
Special (gains) and charges subtotal		21.0		3.6		45.5		27.7
Total special (gains) and charges		$29.1		$5.3		$56.8		$82.3

For segment reporting purposes, special (gains) and charges are not allocated to reportable segments, which is consistent with the Company’s internal management reporting.

Restructuring activities

Restructuring activities are primarily related to the Combined Program which is described below. These activities have been included as a component of cost of sales and special (gains) and charges on the Consolidated Statements of Income. Restructuring liabilities have been classified as a component of other current and other noncurrent liabilities on the Consolidated Balance Sheets.

Combined Program

In November 2022 the Company approved a Europe cost savings program. In connection with these actions, the Company expected to incur pre-tax charges of $130 million ($110 million after tax). In February 2023, the Company expanded its previously announced Europe cost savings program to focus on its Institutional and Healthcare businesses in other regions. In connection with the expanded program (“Combined Program”), the Company expects to incur total pre-tax charges of $195 million ($150 million after tax). The Company expects that these restructuring charges will be completed by 2024. Program actions include headcount reductions from terminations, not filling

7

certain open positions, and facility closures. The Combined Program charges are expected to be primarily cash expenditures related to severance and asset disposals.

In anticipation of this Combined Program, a limited number of actions were taken in the fourth quarter of 2022. As a result, the Company reclassified $19.3 million ($14.5 million after tax) from other restructuring to the Combined Program in the first quarter of 2023.

During the second quarter and first six months of 2023 the Company recorded total Combined Program restructuring charges of $19.7 million ($16.2 million after tax) and $33.1 million ($26.4 million after tax), respectively, primarily related to severance. The net liability related to the Combined Program was $57.2 million and $62.0 million as of June 30, 2023 and December 31, 2022, respectively. The remaining liability is expected to be paid over a period of a few months to several quarters and will continue to be funded from operating activities.

Restructuring activity related to the Combined Program since inception of the underlying actions includes the following items:

	Employee		Asset
(millions)	Costs		Disposals		Total
2022 Activity
Recorded expense and accrual		$67.2		$-		$67.2
Net cash payments		(5.2)		-		(5.2)
Net restructuring liability, December 31, 2022		62.0		-		62.0
2023 Activity
Recorded expense and accrual		27.0		6.1		33.1
Net cash payments		(51.1)		-		(51.1)
Non-cash charges		-		(6.1)		(6.1)
Reclassification		19.3		-		19.3
Net restructuring liability, June 30, 2023		$57.2		$-		$57.2

Institutional Advancement Program

The Company approved a restructuring plan in 2020 focused on the Institutional business (“the Institutional Plan”) which is intended to enhance the Company’s Institutional sales and service structure and allow the sales team to capture share and penetration while maximizing service effectiveness by leveraging the Company’s ongoing investments in digital technology. In February 2021, the Company expanded the Institutional Plan, and expect that these restructuring charges will be completed by 2023, with total anticipated costs of $70 million ($55 million after tax). The remaining costs are expected to be primarily non-cash costs related to equipment disposals. Actual costs may vary from these estimates depending on actions taken.

During the second quarter of 2023 and 2022, the Company recorded restructuring charges of $2.1 million ($1.6 million after tax) and $0.7 million ($0.6 million after tax), respectively, and $4.5 million ($3.4 million after tax) and $2.1 million ($1.6 million after tax) in the first six months of 2023 and 2022, respectively, primarily related to disposals of equipment. The Company has recorded $58.6 million ($44.8 million after tax) of cumulative restructuring charges under the Institutional Plan. Net cash payments were $0.7 million and non-cash net charges were $1.6 million for the second quarter of 2023. Net cash payments were $3.1 million and non-cash net charges were $3.3 million for the first six months of 2023.The liability related to the Institutional Plan was $0 million and $1.9 million as of June 30, 2023 and December 31, 2022, respectively.

Accelerate 2020

During 2018, the Company formally commenced a restructuring plan Accelerate 2020 (“the A2020 Plan”), to leverage technology and system investments and organizational changes. The goals of the Plan were to further simplify and automate processes and tasks, reduce complexity and management layers, consolidate facilities and focus on key long-term growth areas by further leveraging technology and structural improvements. The restructuring activities were completed at the end of 2022, with total costs of $254.4 million ($198.4 million after tax).

Net cash payments were $5.4 million and $9.5 million for the second quarter and first six months of 2023, respectively. The liability related to the Plan was $8.6 million and $18.1 million as of the June 30, 2023 and December 31, 2022, respectively. The remaining liability is expected to be paid over a period of several quarters and will continue to be funded from operating activities.

8

Other Restructuring Activities

During the second quarter and first six months of 2022, the Company recorded restructuring charges of $0.3 million ($0.2 million after tax) and $2.0 million ($1.5 million after tax), respectively, related to other immaterial restructuring activity. The charges are primarily related to severance and asset write-offs.

The restructuring liability balance for all other restructuring plans excluding Combined Program, the A2020 Plan and the Institutional Plan was $3.7 million and $23.2 million as of June 30, 2023 and December 31, 2022, respectively. The decrease in liability was driven primarily by the reclass of $19.3 million from other restructuring to the Combined Program in the first six months of 2023. Cash payments during the second quarter and first six months of 2023 related to all other restructuring plans excluding the Combined Program, the A2020 Plan and the Institutional Plan were $0 million and $0.2 million, respectively.

Acquisition and integration related costs

Acquisition and integration related costs reported in product and equipment cost of sales on the Consolidated Statements of Income in the second quarter and first six months of 2022 include $0.9 million ($0.6 million after tax) and $28.5 million ($21.6 million after tax) related primarily to the recognition of fair value step-up in the Purolite Corporation (“Purolite”) inventory.

Acquisition and integration related costs reported in special (gains) and charges on the Consolidated Statements of Income include $3.5 million ($2.7 million after tax) and $3.4 million ($2.4 million after tax) during the second quarter of 2023 and 2022, respectively and $8.5 million ($6.4 million after tax) and $10.9 million ($8.3 million after tax) during the first six months of 2023 and 2022, respectively. Charges are integration related costs primarily related to the Purolite acquisition.

Further information related to the Company’s acquisitions is included in Note 3.

Russia/Ukraine

In light of Russia’s invasion of Ukraine and the sanctions against Russia by the United States and other countries, the Company has made the determination that it will limit its Russian business to operations that are essential to life, providing minimal support for its healthcare, life sciences, food and beverage and certain water businesses. The Company recorded charges of $0.3 million ($0.2 million after tax) and $0.6 million ($0.5 million after tax) in the second quarter and first six months of 2023, respectively, and recorded recoveries of ($5.7) million (($5.7) million after tax) and charges of $12.3 million ($13.3 million after tax) in the second quarter and first six months of 2022, respectively, primarily related to recoverability risk of certain assets in both Russia and Ukraine.

Other operating activities

Other special charges of $3.5 million ($2.6 million after tax) and $10.1 million ($7.7 million after tax) recorded in the second quarter and first six months of 2023, respectively, relate primarily to certain legal charges, which are recorded in special (gains) and charges on the Consolidated Statements of Income.

Other special charges of $5.6 million ($4.4 million after tax) and $26.1 million ($19.7 million after tax) recorded in the second quarter and first six months of 2022, respectively relate primarily to COVID-19 related inventory charges and certain legal charges, which are recorded in product and equipment cost of sales and special (gains) and charges on the Consolidated Statements of Income.

9

3. ACQUISITIONS

Acquisitions

The Company makes business acquisitions that align with its strategic business objectives. The assets and liabilities of acquired businesses are recorded in the Consolidated Balance Sheets based on estimates of the fair value of assets acquired, liabilities assumed and noncontrolling interests acquired as of the acquisition date. Goodwill is recognized in the amount that the purchase consideration paid exceeds the fair value of the net assets acquired. Purchase consideration includes both cash paid and the fair value of noncash consideration exchanged, including stock and/or contingent consideration exchanged, and is reduced by the amount of cash or cash equivalents acquired.

In May 2023, the Company acquired Chemlink Laboratories LLC, a U.S.-based producer of small format cleaning solutions. The Company made two other immaterial acquisitions during the second quarter of 2023. All three acquisitions became part of the Global Institutional & Specialty reporting segment.

The purchase accounting for these acquisitions are preliminary and subject to change as the Company finalizes the valuation of intangible assets, income tax balances and working capital. The Company expects the goodwill arising from the acquisition of Chemlink Laboratories LLC to be tax deductible.

No acquisitions occurred during the first quarter of 2023 or first six months of 2022. The following table summarizes the acquisition date fair value of net assets acquired from the Company’s acquisitions during the second quarter of 2023:

	June 30
(millions)	2023
Net tangible assets (liabilities) acquired		$9.4
Identifiable intangible assets
Customer relationships		35.7
Other technology		21.6
Total intangible assets		57.3
Goodwill		38.7
Total aggregate purchase price		105.4
Acquisition-related liabilities and contingent consideration		(4.8)
Net cash paid for acquisitions, including acquisition-related
liabilities and contingent consideration		$100.6

During the first six months of 2022, the Company recorded purchase accounting adjustments associated with the finalization of the purchase accounting for its 2022 and 2021 acquisitions. As a result of these purchase accounting adjustments, the Company made $7.2 million of acquisition-related payments, acquisition related net liabilities increased by $7.1 million, definite-lived intangible assets decreased by $5.6 million, and goodwill increased by $19.9 million.

The weighted average useful life of identifiable intangible assets acquired during the first six months of 2023 was 12 years. No intangible assets were acquired during the first six months of 2022.

10

4. BALANCE SHEETS INFORMATION

	June 30		December 31
(millions)	2023		2022
Accounts receivable, net
Accounts receivable		$2,929.9		$2,829.0
Allowance for expected credit losses and other accruals		(149.8)		(130.9)
Total		$2,780.1		$2,698.1
Inventories
Finished goods		$1,041.8		$1,122.7
Raw materials and parts		834.6		849.2
Inventories at FIFO cost		1,876.4		1,971.9
FIFO cost to LIFO cost difference		(230.2)		(179.1)
Total		$1,646.2		$1,792.8
Other current assets
Prepaid assets		$137.6		$123.9
Taxes receivable		215.3		184.1
Derivative assets		62.2		57.5
Other		40.9		39.2
Total		$456.0		$404.7
Property, plant and equipment, net
Land		$155.0		$161.3
Buildings and leasehold improvements		1,145.0		1,126.9
Machinery and equipment		2,037.3		1,966.3
Merchandising and customer equipment		2,709.2		2,635.5
Capitalized software		941.6		962.1
Construction in progress		357.4		403.8
		7,345.5		7,255.9
Accumulated depreciation		(4,019.0)		(3,962.5)
Total		$3,326.5		$3,293.4
Other intangible assets, net
Intangible assets not subject to amortization
Trade names		$1,230.0		$1,230.0
Intangible assets subject to amortization
Customer relationships		3,353.4		3,292.8
Patents		501.6		497.0
Trademarks		406.3		404.0
Other technologies		541.0		518.8
		4,802.3		4,712.6
Accumulated amortization
Customer relationships		(1,697.8)		(1,581.7)
Patents		(307.9)		(292.3)
Trademarks		(219.6)		(202.5)
Other technologies		(203.4)		(185.4)
		(2,428.7)		(2,261.9)
Net intangible assets subject to amortization		2,373.6		2,450.7
Total		$3,603.6		$3,680.7
Other assets
Deferred income taxes		$110.2		$108.1
Pension		129.6		118.4
Derivative asset		33.2		44.5
Other		268.5		264.1
Total		$541.5		$535.1

11

	June 30		December 31
(millions)	2023		2022
Other current liabilities
Discounts and rebates		$392.9		$357.8
Dividends payable		151.0		150.8
Interest payable		75.3		58.7
Taxes payable, other than income		167.8		162.9
Derivative liability		0.4		21.9
Restructuring		73.7		100.6
Contract liability		107.4		116.5
Operating lease liabilities		110.1		108.3
Other		203.8		208.4
Total		$1,282.4		$1,285.9
Accumulated other comprehensive income (loss)
Unrealized (loss) gain on derivative financial instruments, net of tax		($2.5)		$3.7
Unrecognized pension and postretirement benefit expense, net of tax		(471.5)		(467.4)
Cumulative translation, net of tax		(1,287.8)		(1,262.9)
Total		($1,761.8)		($1,726.6)

5. DEBT AND INTEREST

Short-term Debt

The following table provides the components of the Company’s short-term debt obligations as of June 30, 2023 and December 31, 2022.

	June 30		December 31
(millions)	2023		2022
Short-term debt
Commercial paper		$-		$-
Notes payable		5.4		3.7
Long-term debt, current maturities		1,116.5		501.4
Total		$1,121.9		$505.1

Lines of Credit

As of June 30, 2023, the Company has a $2.0 billion multi-year revolving credit facility which expires in April 2026. The credit facility has been established with a diverse syndicate of banks and supports the Company’s U.S. and Euro commercial paper programs. There were no borrowings under the Company’s credit facility as of either June 30, 2023 or December 31, 2022.

Commercial Paper

The Company’s commercial paper program is used as a potential source of liquidity and consists of a $2.0 billion U.S. commercial paper program and a $2.0 billion Euro commercial paper program. The maximum aggregate amount of commercial paper that may be issued by the Company under its commercial paper programs may not exceed $2.0 billion.

The Company had no outstanding commercial paper under its U.S. and Euro commercial paper programs as of June 30, 2023 and as of December 31, 2022.

Notes Payable

The Company’s notes payable consists of uncommitted credit lines with major international banks and financial institutions, primarily to support global cash pooling structures. As of June 30, 2023 and December 31, 2022, the Company had $5.4 million and $3.7 million, respectively, outstanding under these credit lines.

12

Long-term Debt

The following table provides the components of the Company’s long-term debt obligations, including current maturities, as of June 30, 2023 and December 31, 2022.

	Maturity	June 30		December 31
(millions)	by Year	2023		2022
Long-term debt
Public notes (2023 principal amount)
Two year 2021 senior notes ($500 million)	2023		$499.4		$498.7
Seven year 2016 senior notes (€575 million)	2024		614.0		596.9
Ten year 2015 senior notes (€575 million)	2025		613.3		596.7
Ten year 2016 senior notes ($750 million)	2026		721.3		721.1
Ten year 2017 senior notes ($500 million)	2027		434.5		433.9
Six Year 2021 senior notes ($500 million)	2027		496.9		496.5
Five Year 2022 senior notes ($500 million)	2028		493.4		492.7
Ten year 2020 senior notes ($698 million)	2030		652.8		653.5
Ten year 2020 senior notes ($600 million)	2031		555.7		555.2
Eleven year 2021 senior notes ($650 million)	2032		644.9		644.6
Thirty year 2011 senior notes ($389 million)	2041		384.6		384.5
Thirty year 2016 senior notes ($200 million)	2046		197.3		197.3
Thirty year 2017 senior notes ($484 million)	2047		426.1		425.5
Thirty year 2020 senior notes ($500 million)	2050		490.9		490.7
Thirty year 2021 senior notes ($850 million)	2051		839.1		838.9
Thirty-four year 2021 senior notes ($685 million)	2055		538.2		537.2
Finance lease obligations and other			13.7		12.8
Total debt			8,616.1		8,576.7
Long-term debt, current maturities			(1,116.5)		(501.4)
Total long-term debt			$7,499.6		$8,075.3

Public Notes

The Company’s public notes may be redeemed by the Company at its option at redemption prices that include accrued and unpaid interest and a make-whole premium. Upon the occurrence of a change of control accompanied by a downgrade of the public notes below investment grade rating, within a specified time period, the Company would be required to offer to repurchase the public notes at a price equal to 101% of the aggregate principal amount thereof, plus any accrued and unpaid interest to the date of repurchase. The public notes are senior unsecured and unsubordinated obligations of the Company and rank equally with all other senior and unsubordinated indebtedness of the Company.

Covenants

The Company is in compliance with all covenants under the Company’s outstanding indebtedness as of June 30, 2023.

Net Interest Expense

Interest expense and interest income recognized during the second quarter and first six months of 2023 and 2022 were as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Interest expense		$82.7		$57.3		$162.8		$112.4
Interest income		(4.9)		(1.3)		(10.8)		(3.4)
Interest expense, net		$77.8		$56.0		$152.0		$109.0

Interest expense generally includes the expense associated with the interest on the Company’s outstanding borrowings, including the impact of the Company’s interest rate swap agreements. Interest expense also includes the amortization of debt issuance costs and debt discounts, which are both recognized over the term of the related debt.

13

6. GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

Goodwill arises from the Company’s acquisitions and represents the excess of the fair value of the purchase consideration exchanged over the fair value of net assets acquired. The Company’s reporting units are its ten operating segments. The Company assesses goodwill for impairment on an annual basis during the second quarter. If circumstances change or events occur that demonstrate it is more likely than not that the carrying amount of a reporting unit exceeds its fair value, the Company completes an interim goodwill assessment of that reporting unit prior to the next annual assessment. If the results of an annual or interim goodwill assessment demonstrate the carrying amount of a reporting unit is greater than its fair value, the Company will recognize an impairment loss for the amount by which the reporting unit’s carrying amount exceeds its fair value, but not to exceed the carrying amount of goodwill assigned to that reporting unit.

During the second quarter of 2023, the Company completed its annual goodwill impairment assessment for its reporting units using discounted cash flow analyses that incorporated assumptions regarding future growth rates, terminal values and discount rates. The Company’s goodwill impairment assessments for 2023 indicated the estimated fair values of each of these ten reporting units exceeded the carrying amounts of the respective reporting unit by a significant margin. There has been no impairment of goodwill in any of the periods presented.

The changes in the carrying amount of goodwill for each of the Company's reportable segments during the second quarter ended June 30, 2023 were as follows:

			Global		Global
	Global		Institutional		Healthcare &
(millions)	Industrial		& Specialty		Life Sciences		Other		Total
December 31, 2022		4,081.8		567.6		3,125.4		237.9		8,012.7
Current year business combinations		-		38.7		-		-		38.7
Effect of foreign currency translation		16.6		2.7		29.6		1.0		49.9
June 30, 2023		$4,098.4		$609.0		$3,155.0		$238.9		$8,101.3

Other Intangible Assets

The Nalco trade name is the Company’s only indefinite life intangible asset, which is tested for impairment on an annual basis during the second quarter. During the second quarter of 2023, the Company completed its annual impairment assessment of the Nalco trade name using the relief from royalty discounted cash flow method, which incorporates assumptions regarding future sales projections, royalty rates and discount rates. The Company’s Nalco tradename impairment assessment for 2023 indicated the estimated fair value of the Nalco trade name exceeded its $1.2 billion carrying amount by a significant margin. There has been no impairment of the Nalco trade name intangible since it was acquired.

The Company’s intangible assets subject to amortization include customer relationships, trademarks, patents and other technologies primarily acquired through business acquisitions. The fair value of intangible assets acquired in business acquisitions are estimated primarily using discounted cash flow valuation methods at the time of acquisition. Intangible assets are amortized on a straight-line basis over their estimated lives. Total amortization expense related to intangible assets during the second quarter of 2023 and 2022 was $76.8 million and $78.7 million, respectively, and during the first six months of 2023 and 2022 was $152.4 million and $158.2 million, respectively. Amortization expense related to intangible assets for the remaining six-month period of 2023 is expected to be approximately $151 million.

14

7. FAIR VALUE MEASUREMENTS

The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, contingent consideration obligations, commercial paper, notes payable, foreign currency forward contracts, interest rate swap agreements, cross-currency swap derivative contracts and long-term debt.

Fair value is defined as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. A hierarchy has been established for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs be used when available. The hierarchy is broken down into three levels:

Level 1 - Inputs are quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2 - Inputs include observable inputs other than quoted prices in active markets.

Level 3 - Inputs are unobservable inputs for which there is little or no market data available.

The carrying amount and the estimated fair value for assets and liabilities measured on a recurring basis were:

	June 30, 2023
(millions)	Carrying		Fair Value Measurements
	Amount		Level 1		Level 2		Level 3
Assets
Foreign currency forward contracts		$85.3		$-		$85.3		$-
Cross-currency swap derivative contracts		42.7		-		42.7		-
Liabilities
Foreign currency forward contracts		23.5		-		23.5		-
Interest rate swap agreements		182.6		-		182.6		-
Cross-currency swap derivative contracts		19.6		-		19.6		-

	December 31, 2022
(millions)	Carrying		Fair Value Measurements
	Amount		Level 1		Level 2		Level 3
Assets
Foreign currency forward contracts		$118.9		$-		$118.9		$-
Cross-currency swap derivative contracts		58.7		-		58.7		-
Liabilities
Foreign currency forward contracts		83.3		-		83.3		-
Interest rate swap agreements		181.4		-		181.4		-
Cross-currency swap derivative contracts		14.5		-		14.5		-

The carrying value of foreign currency forward contracts is at fair value, which are determined based on foreign currency exchange rates as of the balance sheet date and are classified within Level 2. The carrying value of interest rate swap agreements are at fair value, which are determined based on current forward interest rates as of the balance sheet date and are classified within Level 2. The cross-currency swap derivative contracts are used to partially hedge the Company’s net investments in foreign operations against adverse movements in exchange rates between the U.S. dollar and the Euro. The carrying value of the cross-currency swap derivative contracts are at fair value, which are determined based on the income approach with the relevant interest rates and foreign currency current exchange rates and forward curves as inputs as of the balance sheet date and are classified within Level 2. For purposes of fair value disclosure above, derivative values are presented gross. Further discussion of gross versus net presentation of the Company's derivatives is included within Note 8.

Contingent consideration obligations are recognized and measured at fair value at the acquisition date and thereafter until settlement or expiration. Contingent consideration is classified within Level 3 as the underlying fair value is determined using income-based valuation approaches appropriate for the terms and conditions of each respective contingent consideration. The consideration expected to be transferred is based on the Company’s expectations of various financial measures. The ultimate payment of contingent consideration could deviate from current estimates based on the actual results of these financial measures. Contingent consideration was not material to the Company’s consolidated financial statements.

The carrying values of accounts receivable, accounts payable, cash and cash equivalents, commercial paper and notes payable approximate fair value because of their short maturities and as such are classified within Level 1.

The fair value of long-term debt is based on quoted market prices for the same or similar debt instruments (classified as Level 2). The carrying amount, which includes adjustments related to the impact of interest rate swap agreements, premiums and discounts, and deferred debt issuance costs, and the estimated fair value of long-term debt, including current maturities, held by the Company were:

	June 30, 2023				December 31, 2022
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Long-term debt, including current maturities		$8,616.1		$7,806.2		$8,576.7		$7,643.6

15

8. DERIVATIVES AND HEDGING TRANSACTIONS

The Company uses foreign currency forward contracts, interest rate swap agreements, cross-currency swap derivative contracts and foreign currency debt to manage risks associated with foreign currency exchange rates, interest rates and net investments in foreign operations. The Company does not hold derivative financial instruments of a speculative nature or for trading purposes. The Company records derivatives as assets and liabilities in the Consolidated Balance Sheets at fair value. Changes in fair value are recognized immediately in earnings unless the derivative qualifies and is designated as a hedge. Cash flows from derivatives are classified in the statement of cash flows in the same category as the cash flows from the items subject to designated hedge or undesignated (economic) hedge relationships. The Company evaluates hedge effectiveness at inception and on an ongoing basis. If a derivative is no longer expected to be effective, hedge accounting is discontinued.

The Company is exposed to credit risk in the event of nonperformance of counterparties for foreign currency forward exchange contracts and interest rate swap agreements. The Company monitors its exposure to credit risk by using credit approvals and credit limits and by selecting major global banks and financial institutions as counterparties. The Company does not anticipate nonperformance by any of these counterparties, and therefore, recording a valuation allowance against the Company’s derivative balance is not considered necessary.

Derivative Positions Summary

Certain of the Company’s derivative transactions are subject to master netting arrangements that allow the Company to net settle contracts with the same counterparties. These arrangements generally do not call for collateral and as of the applicable dates presented in the following table, no cash collateral had been received or pledged related to the underlying derivatives.

The respective net amounts are included in other current assets, other assets, other current liabilities and other liabilities on the Consolidated Balance Sheets.

The following table summarizes the gross fair value and the net value of the Company’s outstanding derivatives:

	Derivative Assets				Derivative Liabilities
	June 30		December 31		June 30		December 31
(millions)	2023		2022		2023		2022
Derivatives designated as hedging instruments
Foreign currency forward contracts		$56.7		$78.6		$5.9		$9.2
Interest rate swap agreements		-		-		182.6		181.4
Cross-currency swap derivative contracts		42.7		58.7		19.6		14.5
Derivatives not designated as hedging instruments
Foreign currency forward contracts		28.6		40.3		17.6		74.1
Gross value of derivatives		128.0		177.6		225.7		279.2
Gross amounts offset in the Consolidated Balance Sheets		(32.6)		(75.6)		(32.6)		(75.6)
Net value of derivatives		$95.4		$102.0		$193.1		$203.6

The following table summarizes the notional values of the Company’s outstanding derivatives:

	Notional Values
		June 30	December 31
(millions)		2023	2022
Foreign currency forward contracts		$3,687		$5,745
Interest rate swap agreements		1,500		1,500
Cross-currency swap derivative contracts		682		650

16

Cash Flow Hedges

The Company utilizes foreign currency forward contracts to hedge the effect of foreign currency exchange rate fluctuations on forecasted foreign currency transactions, including inventory purchases and intercompany royalty, intercompany loans, management fee and other payments. These forward contracts are designated as cash flow hedges. The changes in fair value of these contracts are recorded in accumulated other comprehensive income (loss) (“AOCI”) until the hedged items affect earnings, at which time the gain or loss is reclassified into the same line item on the Consolidated Statements of Income as the underlying exposure being hedged. Cash flow hedged transactions impacting AOCI are forecasted to occur within the next year. For forward contracts designated as hedges of foreign currency exchange rate risk associated with forecasted foreign currency transactions, the Company excludes the changes in fair value attributable to time value from the assessment of hedge effectiveness. The initial value of the excluded component (i.e., the forward points) is amortized on a straight-line basis over the life of the hedging instrument and recognized in the same line item on the Consolidated Statements of Income as the underlying exposure being hedged for intercompany loans. For all other cash flow hedge types, the forward points are marked-to-market monthly and recognized in the same line item on the Consolidated Statements of Income as the underlying exposure being hedged. The difference between fair value changes of the excluded component and the amount amortized on the Consolidated Statements of Income is recorded in AOCI.

Fair Value Hedges

The Company manages interest expense using a mix of fixed and floating rate debt. To help manage exposure to interest rate movements and to reduce borrowing costs, the Company may enter into interest rate swap agreements under which the Company agrees to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed upon notional principal amount. The mark-to-market of these fair value hedges is recorded as gains or losses in interest (income) expense and is offset by the gain or loss of the underlying debt instrument, which also is recorded in interest (income) expense. These fair value hedges are highly effective and thus, there is no impact on earnings due to hedge ineffectiveness.

In aggregate, the Company has entered into a series of interest rate swap agreements to convert $1.5 billion of its debt from a fixed interest rate to a floating interest rate. These interest rate swap agreements are designated as fair value hedges.

The following amounts were recorded in the Consolidated Balance Sheets related to cumulative basis adjustments for fair value hedges:

	Carrying amount of the hedged liabilities				Cumulative amount of the fair value hedging adjustment included in the carrying amount of the hedged liabilities
	Second Quarter Ended				Second Quarter Ended
Line item in which the hedged item is included	June 30				June 30
(millions)	2023		2022		2023		2022
Long-term debt		$1,317.9		$1,376.4		($184.5)		($125.9)

Net Investment Hedges

The Company designates its outstanding €1,150 million ($1,229 million at the end of the second quarter of 2023) senior notes (“Euronotes”) and related accrued interest as hedges of its Euro denominated exposures from the Company’s investments in certain of its Euro denominated functional currency subsidiaries.

The Company entered into a series of cross-currency swap derivative contracts maturing in 2026 and 2030. The cross-currency swap derivative contracts are designated as net investment hedge of its Euro denominated exposures from the Company’s investments in certain of its Euro denominated functional currency subsidiaries. The cross-currency swap derivative contracts exchange fixed-rate payments in one currency for fixed-rate payments in another currency. As of June 30, 2023, the Company had €625 million ($682 million) cross-currency swap derivative contracts outstanding as hedges of the Company’s net investment in foreign operations. The changes in the spot rate of these instruments are recorded in AOCI in stockholders’ equity, partially offsetting the foreign currency translation adjustment of the Company’s related net investment that is also recorded in AOCI. Any ineffective portions of net investment hedges are reclassified from AOCI into earnings during the period of change. The interest income or expense from these swaps are recorded in interest expense on the accompanying Consolidated Statements of Income consistent with the classification of interest expense attributable to the underlying debt.

17

The revaluation gains and losses on the Euronotes and cross-currency swap derivative contracts, which are designated and effective as hedges of the Company’s net investments, have been included as a component of the cumulative translation adjustment account, and were as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Revaluation (loss) gain, net of tax:
Euronotes		($9.8)		$42.5		($24.9)		$52.8
Cross-currency swap derivative contracts		(14.0)		28.9		(15.6)		37.5
Total revaluation (loss) gain, net of tax		($23.8)		$71.4		($40.5)		$90.3

Derivatives Not Designated as Hedging Instruments

The Company also uses foreign currency forward contracts to offset its exposure to the change in value of certain foreign currency denominated assets and liabilities held at foreign subsidiaries, primarily receivables and payables, which are remeasured at the end of each period. Although the contracts are effective economic hedges, they are not designated as accounting hedges. Therefore, changes in the value of these derivatives are recognized immediately in earnings, thereby offsetting the current earnings effect of the related foreign currency denominated assets and liabilities.

Effect of all Derivative Instruments on Income

The gain (loss) of all derivative instruments recognized in product and equipment cost of sales (“COS”), selling, general and administrative expenses (“SG&A”) and interest expense, net (“interest”) is summarized below:

	Second Quarter Ended
	June 30
	2023				2022
(millions)		COS	SG&A	Interest		COS	SG&A	Interest
Gain (loss) on derivatives in cash flow hedging relationship:
Foreign currency forward contracts
Amount of gain (loss) reclassified from AOCI to income		$2.8	($4.4)	$-		$0.8	$38.2	$-
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value		-	-	2.1		-	-	3.9
Interest rate swap agreements
Amount of (loss) gain reclassified from AOCI to income		-	-	(0.4)		-	-	(0.6)
(Loss) gain on derivatives not designated as hedging instruments:
Foreign currency forward contracts
Amount of (loss) gain recognized in income		-	(3.5)	-		-	34.2	-
Total gain (loss) of all derivative instruments		$2.8	($7.9)	$1.7		$0.8	$72.4	$3.3
	Six Months Ended
	June 30
	2023				2022
(millions)		COS	SG&A	Interest		COS	SG&A	Interest
Gain (loss) on derivatives in cash flow hedging relationship:
Foreign currency forward contracts
Amount of gain (loss) reclassified from AOCI to income		$8.1	($10.4)	$-		$0.8	$52.1	$-
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value		-	-	4.1		-	-	7.7
Interest rate swap agreements
Amount of (loss) gain reclassified from AOCI to income		-	-	(0.9)		-	-	(1.2)
(Loss) gain on derivatives not designated as hedging instruments:
Foreign currency forward contracts
Amount of (loss) gain recognized in income		-	(28.1)	-		-	48.4	-
Total gain (loss) of all derivative instruments		$8.1	($38.5)	$3.2		$0.8	$100.5	$6.5

18

9. OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION

Other comprehensive income (loss) includes net income, foreign currency translation adjustments, defined benefit pension and postretirement plan adjustments, gains and losses on derivative instruments designated and effective as cash flow hedges and non-derivative instruments designated and effective as foreign currency net investment hedges that are charged or credited to the accumulated other comprehensive loss account in shareholders’ equity. Refer to Note 8 for additional information related to the Company’s derivatives and hedging transactions. Refer to Note 13 for additional information related to the Company’s pension and postretirement benefits activity.

The following tables provide other comprehensive income information related to the Company’s derivatives and hedging instruments and pension and postretirement benefits:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Derivative and Hedging Instruments
Unrealized (loss) gain on derivative and hedging instruments
Amount recognized in AOCI		($1.6)		$49.7		($6.7)		$60.4
(Gain) loss reclassified from AOCI into income
COS		(2.8)		(0.8)		(8.1)		(0.8)
SG&A		4.4		(38.2)		10.4		(52.1)
Interest (income) expense, net		(1.7)		(3.3)		(3.2)		(6.5)
		(0.1)		(42.3)		(0.9)		(59.4)
Other activity		1.1		0.5		1.2		0.5
Tax impact		(0.9)		(1.8)		0.2		-
Net of tax		($1.5)		$6.1		($6.2)		$1.5
Pension and Postretirement Benefits
Amount reclassified from AOCI into income
Settlement charge		$-		$-		$0.6		$0.9
Amortization of net actuarial loss and prior period service credits, net		0.9		14.5		2.5		29.4
		0.9		14.5		3.1		30.3
Other activity		(4.5)		16.8		(6.1)		17.9
Tax impact		(0.7)		(3.3)		(1.1)		(6.5)
Net of tax		($4.3)		$28.0		($4.1)		$41.7

The following table summarizes the derivative and pension and postretirement benefit amounts reclassified from AOCI into income:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
	2023		2022		2023		2022
(millions)
Derivative (gain) loss reclassified from AOCI into income, net of tax		($0.1)		($31.9)		($0.7)		($44.8)
Pension and postretirement benefits amortization of net actuarial losses and prior period service credits and settlement charges reclassified from AOCI into income, net of tax		(4.3)		28.0		(4.1)		41.7

10. SHAREHOLDERS’ EQUITY

Share Repurchase Authorization

In February 2015 and November 2022, the Company’s Board of Directors authorized the repurchase of up to 20,000,000 and 10,000,000, respectively, additional shares of its common stock, including shares to be repurchased under Rule 10b5–1. As of June 30, 2023, 12,917,097 shares remained to be repurchased under the Company’s repurchase authorization. The Company intends to repurchase all shares under its authorization, for which no expiration date has been established, in open market or privately negotiated transactions, subject to market conditions.

Share Repurchases

During the first six months of 2023, the Company reacquired 68,712 shares of its common stock related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units.

During the first six months of 2022, the Company reacquired 2,284,094 shares of its common stock, of which 2,186,990 related to share repurchases through open market and 97,104 related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units.

19

11. EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE (“EPS”)

The difference in the weighted average common shares outstanding for calculating basic and diluted EPS is a result of the dilution associated with the Company’s equity compensation plans. As noted in the table below, certain stock options and units outstanding under these equity compensation plans were not included in the computation of diluted EPS because they would not have had a dilutive effect.

The computations of the basic and diluted EPS amounts were as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions, except per share)	2023		2022		2023		2022
Net income attributable to Ecolab		$329.7		$308.3		$563.1		$480.2
Weighted-average common shares outstanding
Basic		284.9		285.1		284.8		285.7
Effect of dilutive stock options and units		1.4		1.5		1.3		1.7
Diluted		286.3		286.6		286.1		287.4
Earnings attributable to Ecolab per common share
Basic EPS		$ 1.16		$ 1.08		$ 1.98		$ 1.68
Diluted EPS		$ 1.15		$ 1.08		$ 1.97		$ 1.67
Anti-dilutive securities excluded from the computation of diluted EPS		2.6		2.6		3.8		2.6
Amounts do not necessarily sum due to rounding.

12. INCOME TAXES

The Company’s tax rate was 20.6% and 19.7% for the second quarter of 2023 and 2022, respectively, and 19.5% and 20.0% for the first six months of 2023 and 2022, respectively. The change in the Company’s tax rate for the second quarter and first six months of 2023 compared to the second quarter and first six months of 2022 was driven primarily by the impact of discrete tax items and special (gains) and charges. Further information related to special (gains) and charges is included in Note 2.

The Company recognized net tax expense related to discrete tax items of $2.8 million and a net tax benefit of $1.2 million in the second quarter and first six months of 2023, respectively. This included share-based compensation excess tax benefits of $1.8 million and $1.9 million in the second quarter and first six months of 2023, respectively. Additionally, the Company recognized discrete tax expense of $4.6 million and $0.7 million during the second quarter and first six months of 2023, respectively, primarily due to audit settlements, uncertain tax positions, prior year return adjustments, repricing of deferred tax balances, and other changes in estimates.

The Company recognized net tax expense related to discrete tax items of $3.7 million and $4.7 million in the second quarter and first six months of 2022, respectively. This included share-based compensation excess tax benefits of $0.7 million and $3.6 million in the second quarter and first six months of 2022, respectively. Additionally, the Company recognized discrete tax expense of $4.4 million and $8.3 million during the second quarter and first six months of 2022, respectively, primarily due to audit settlements, uncertain tax positions, prior year return adjustments, repricing of deferred tax balances, and other changes in estimates.

The Inflation Reduction Act (IRA), which became effective January 1, 2023, includes a corporate alternative minimum tax on certain large corporations and climate change mitigation incentives. In addition, there are other non-income tax provisions, including an excise tax on the repurchase of corporate stock. The Company continues to assess the impact of the IRA but does not anticipate any material impacts on the Company’s financial statements. 

20

13. PENSION AND POSTRETIREMENT PLANS

The Company has a non-contributory, qualified, defined benefit pension plan covering the majority of its U.S. employees. The Company also has non-contributory, non-qualified, defined benefit pension plans, which provide for benefits to employees in excess of limits permitted under its U.S. pension plans. Various international subsidiaries also have defined benefit pension plans. The Company also provides postretirement health care and life insurance benefits to certain U.S. employees and retirees.

The components of net periodic pension and postretirement health care benefit expense for the second quarter ended June 30 are as follows:

	U.S.				International				U.S. Postretirement
	Pension				Pension				Health Care
(millions)	2023		2022		2023		2022		2023		2022
Service cost		$10.6		$10.5		$5.4		$6.9		$0.1		$0.2
Interest cost on benefit obligation		22.0		14.1		11.6		5.5		1.4		0.8
Expected return on plan assets		(36.3)		(36.7)		(14.0)		(17.6)		-		(0.1)
Recognition of net actuarial loss (gain)		-		10.0		3.3		5.8		(0.8)		(0.1)
Amortization of prior service benefit		(1.5)		(1.2)		(0.1)		-		-		-
Total expense (benefit)		($5.2)		($3.3)		$6.2		$0.6		$0.7		$0.8

The components of net periodic pension and postretirement health care benefit expense for the six months ended June 30 are as follows:

	U.S.				International				U.S. Postretirement
	Pension				Pension				Health Care
(millions)	2023		2022		2023		2022		2023		2022
Service cost		$20.8		$21.0		$10.8		$14.2		$0.2		$0.4
Interest cost on benefit obligation		44.0		28.2		23.0		11.2		2.8		1.6
Expected return on plan assets		(72.6)		(73.4)		(27.8)		(36.0)		-		(0.2)
Recognition of net actuarial loss (gain)		-		20.0		6.8		11.8		(1.6)		(0.2)
Amortization of prior service benefit		(2.5)		(2.2)		(0.2)		-		-		-
Curtailments and settlements		0.7		0.9		-		-		(0.1)		-
Total expense (benefit)		($9.6)		($5.5)		$12.6		$1.2		$1.3		$1.6

Service cost is included as employee compensation cost in either cost of sales or selling, general and administrative expenses on the Consolidated Statements of Income based on employee roles, while non-service components are included in other (income) expense in the Consolidated Statements of Income.

As of June 30, 2023, the Company is in compliance with all funding requirements of each of its defined benefit plans.

During the first six months of 2023, the Company made contributions of $4 million to its U.S. non-contributory non-qualified defined benefit plans and estimates it will contribute an additional $5 million to such plans during the remainder of 2023.

During the first six months of 2023, the Company made contributions of $20 million to its international pension plans and estimates it will contribute an additional $22 million to such plans during the remainder of 2023.

During the first six months of 2023, the Company made contributions of $5 million to its U.S. postretirement health care plans and estimates it will contribute an additional $6 million to such plans during the remainder of 2023.

21

14. REVENUES

Revenue Recognition

Product and Sold Equipment

Product revenue is generated from sales of cleaning, sanitizing, water treatment, process treatment and colloidal silica products. In addition, the Company sells equipment which may be used in combination with its specialized products. Revenue recognized from product and equipment sales is recognized at the point in time when the obligations in the contract with the customer are satisfied, which generally occurs with the transfer of the product or delivery of the equipment.

On June 3, 2020, the Company completed the separation of its Upstream Energy business (“ChampionX”). The Company entered into a Master Cross Supply and Product Transfer agreement with ChampionX to provide, receive or transfer certain products for a period up to 36 months and for a smaller set of products with limited suppliers over the next few years. Sales of product to ChampionX under this agreement are recorded in product and equipment sales in the Corporate segment along with the related cost of sales, while purchases from ChampionX are recorded in inventory. Sales of product to ChampionX post-separation for the second quarter of 2023 and 2022 were $16.7 million and $33.9 million, respectively, and for the first six months of 2023 and 2022 were $40.4 million and $68.6 million, respectively. As of June 30, 2023 and December 31, 2022, the Company had an outstanding accounts receivable balance for sales of product to ChampionX of $12.0 million and $12.9 million, respectively.

Service and Lease Equipment

Service and lease equipment revenue is generated from providing services or leasing equipment to customers. Service offerings include installing or repairing certain types of equipment, activities that supplement or replace headcount at the customer location, or fulfilling deliverables included in the contract. Global Industrial segment services are associated with water treatment and paper process applications. Global Institutional & Specialty segment services include cleaning and sanitizing programs and wash process solutions. Global Healthcare & Life Sciences segment services include pharmaceutical, personal care, infection and containment control solutions. Revenues included in Other primarily relate to services designed to detect, eliminate and prevent pests. Service revenue is recognized over time utilizing an input method and aligns with when the services are provided. Typically, revenue is recognized over time using costs incurred to date because the effort provided by the field selling and service organization represents services provided, which corresponds with the transfer of control. Revenue recognized from leased equipment primarily relates to warewashing and water treatment equipment recognized on a straight-line basis over the length of the lease contract pursuant to Topic 842 Leases.

The Company’s operating lease revenue was as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Operating lease revenue*		$128.7		$115.2		$255.1		$227.3

*Includes immaterial variable lease revenue

The following table shows principal activities, separated by reportable segments, from which the Company generates its revenue. Corporate segment includes sales to ChampionX under the Master Cross Supply and Product Transfer agreements entered into as part of the ChampionX Separation. For more information about the Company’s reportable segments, refer to Note 15.

22

Net sales at public exchange rates by reportable segment are as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Global Industrial
Product and sold equipment		$1,587.8		$1,471.4		$3,086.0		$2,829.8
Service and lease equipment		220.7		218.5		431.9		425.8
Global Institutional & Specialty
Product and sold equipment		1,047.2		936.3		1,968.0		1,763.3
Service and lease equipment		225.0		193.0		433.0		375.4
Global Healthcare & Life Sciences
Product and sold equipment		363.9		360.2		716.5		694.2
Service and lease equipment		26.9		30.7		54.0		59.5
Other
Product and sold equipment		89.2		85.0		170.2		155.0
Service and lease equipment		274.7		251.6		523.7		475.6
Corporate
Product and sold equipment		16.7		33.9		40.4		68.6
Service and lease equipment		-		-		-		0.1
Total
Total product and sold equipment		$3,104.8		$2,886.8		$5,981.1		$5,510.9
Total service and lease equipment		$747.3		$693.8		$1,442.6		$1,336.4

Net sales at public exchange rates by geographic region for the second quarter ended June 30 are as follows:

	Global				Global Institutional				Global Healthcare
	Industrial				& Specialty				& Life Sciences				Other				Corporate
	2023		2022		2023		2022		2023		2022		2023		2022		2023		2022
North America		$814.7		$776.6		$933.8		$828.1		$156.4		$157.6		$232.3		$214.9		$12.4		$30.3
Europe		382.4		341.3		174.7		164.3		186.1		180.7		74.1		69.7		1.3		0.9
Asia Pacific		222.2		209.0		58.4		53.0		22.6		24.4		23.0		19.6		0.8		1.1
Latin America		181.0		156.0		47.6		41.5		6.6		5.3		14.2		13.1		2.2		1.6
Greater China		101.0		106.5		40.5		28.7		12.9		17.0		18.0		16.7		-		-
India, Middle East and Africa		107.2		100.5		17.2		13.7		6.2		5.9		2.3		2.6		-		-
Total		$1,808.5		$1,689.9		$1,272.2		$1,129.3		$390.8		$390.9		$363.9		$336.6		$16.7		$33.9

Net sales at public exchange rates by geographic region for the six months ended June 30 are as follows:

	Global				Global Institutional				Global Healthcare
	Industrial				& Specialty				& Life Sciences				Other				Corporate
(millions)	2023		2022		2023		2022		2023		2022		2023		2022		2023		2022
North America		$1,605.4		$1,493.2		$1,767.7		$1,560.1		$320.3		$302.6		$442.6		$396.6		$33.1		$59.7
Europe		731.2		654.8		321.2		301.0		360.5		350.8		141.3		131.8		2.0		1.5
Asia Pacific		436.5		414.1		115.2		105.7		42.3		44.4		43.2		36.2		1.8		2.1
Latin America		338.2		292.4		88.9		78.3		12.3		11.2		27.8		26.1		3.5		5.1
Greater China		195.6		216.7		76.1		68.9		23.7		31.8		34.3		34.6		-		0.1
India, Middle East and Africa		211.0		184.4		31.9		24.7		11.4		12.9		4.7		5.3		-		0.2
Total		$3,517.9		$3,255.6		$2,401.0		$2,138.7		$770.5		$753.7		$693.9		$630.6		$40.4		$68.7

Net sales by geographic region were determined based on origin of sale. The United States made up 53% and 53% of total revenues during the six months ended June 30, 2023 and 2022, respectively.

23

Accounts Receivable and Allowance for Expected Credit Losses

Accounts receivable are carried at the invoiced amounts, less an allowance for expected credit losses, and generally do not bear interest. The Company’s allowance for expected credit losses estimates the amount of expected future credit losses by analyzing accounts receivable balances by age and applying historical write-off and collection experience. The Company’s estimates separately consider macroeconomic trends, specific circumstances and credit conditions of customer receivables. Account balances are written off against the allowance when it is determined the receivable will not be recovered.

The Company’s allowance for expected return of products shipped and credits related to pricing or quantities shipped was $66.0 million and $24.9 million as of June 30, 2023 and 2022, respectively. Returns and credit activity is recorded directly as a reduction to revenue.

The following table summarizes the activity in the allowance for expected credit losses:

	Six Months Ended
	June 30
(millions)	2023		2022
Beginning balance		$71.9		$52.8
Bad debt expense		32.5		24.8
Write-offs		(18.6)		(8.5)
Other (a)		(2.0)		3.8
Ending balance		$83.8		$72.9

(a) Other amounts are primarily the effects of changes in currency translations.

Contract Liability

Payments received from customers are based on invoices or billing schedules as established in contracts with customers. Accounts receivable are recorded when the right to consideration becomes unconditional. The contract liability relates to billings in advance of performance (primarily service obligations) under the contract. Contract liabilities are recognized as revenue when the performance obligation has been performed, which primarily occurs during the subsequent quarter.

The following table summarizes the contract liability activity:

	Six Months Ended
	June 30
(millions)	2023		2022
Contract liability as of beginning of the year		$116.5		$91.7
Revenue recognized in the period from:
Amounts included in the contract liability at the beginning of the year		(116.5)		(91.7)
Increases due to billings excluding amounts recognized as revenue during the period ended		107.4		99.1
Contract liability as of end of period		$107.4		$99.1

24

15. OPERATING SEGMENTS

The Company’s organizational structure consists of global business unit and global regional leadership teams. The Company’s ten operating segments follow its commercial and product-based activities and are based on engagement in business activities, availability of discrete financial information and review of operating results by the Chief Operating Decision Maker at the identified operating segment level.

The Company’s operating segments that share similar economic characteristics and future prospects, nature of the products and production processes, end-use markets, channels of distribution and regulatory environment have been aggregated into three reportable segments: Global Industrial, Global Institutional & Specialty and Global Healthcare & Life Sciences. The Company’s operating segments that do not meet the quantitative criteria to be separately reported have been combined into Other. The Company provides similar information for Other as the Company considers the information regarding its underlying operating segments as useful in understanding its consolidated results.

Comparability of Reportable Segments

Effective January 1, 2023, the Company’s former Downstream operating segment is now part of the Water operating segment. This change did not have any impact on the Global Industrial reportable segment.

The Company evaluates the performance of its non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminates the impact of exchange rate fluctuations on its international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. The “Fixed Currency Rate Change” column shown in the following table reflects international operations at fixed currency exchange rates established by management at the beginning of 2023, rather than the 2022 established rates. The difference between the fixed currency exchange rates and the actual currency exchange rates is reported within the “Effect of foreign currency translation” row in the following table. The “Other” column shown in the following table reflects immaterial changes between reportable segments, including the movement of certain customers and cost allocations.

The impact of the preceding changes on previously reported full year 2022 reportable segment net sales and operating income is summarized as follows:

	December 31, 2022
	2022 Reported					Fixed	2022 Reported
	Valued at 2022				Currency		Valued at 2023
(millions)	Management Rates		Other		Rate Change		Management Rates
Net Sales
Global Industrial		$6,944.0		$-		($207.7)		$6,736.3
Global Institutional & Specialty		4,480.0		10.2		(75.9)		4,414.3
Global Healthcare & Life Sciences		1,570.0		-		(64.2)		1,505.8
Other		1,355.0		(10.2)		(31.5)		1,313.3
Corporate		124.1		-		(0.4)		123.7
Subtotal at fixed currency rates		14,473.1		-		(379.7)		14,093.4
Effect of foreign currency translation		(285.3)				379.7		94.4
Consolidated reported GAAP net sales		$14,187.8		$-		$-		$14,187.8
Operating Income
Global Industrial		$977.0		$0.8		($42.0)		$935.8
Global Institutional & Specialty		634.5		(1.6)		(11.2)		621.7
Global Healthcare & Life Sciences		205.0		(1.8)		(9.9)		193.3
Other		212.8		2.6		(5.5)		209.9
Corporate		(416.7)		-		2.3		(414.4)
Subtotal at fixed currency rates		1,612.6		-		(66.3)		1,546.3
Effect of foreign currency translation		(50.1)				66.3		16.2
Consolidated reported GAAP operating income		$1,562.5		$-		$-		$1,562.5

25

Reportable Segment Information

Financial information for the Company’s reportable segments, is as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Net Sales
Global Industrial		$1,795.6		$1,653.3		$3,494.9		$3,164.7
Global Institutional & Specialty		1,268.6		1,118.2		2,395.2		2,109.5
Global Healthcare & Life Sciences		387.5		384.4		766.1		732.6
Other		362.6		332.5		691.9		619.3
Corporate		16.7		33.8		40.3		68.4
Subtotal at fixed currency rates		3,831.0		3,522.2		7,388.4		6,694.5
Effect of foreign currency translation		21.1		58.4		35.3		152.8
Consolidated reported GAAP net sales		$3,852.1		$3,580.6		$7,423.7		$6,847.3
Operating Income
Global Industrial		$255.4		$216.8		$471.0		$396.7
Global Institutional & Specialty		208.7		148.6		334.4		257.2
Global Healthcare & Life Sciences		32.7		55.2		67.7		97.1
Other		63.4		51.6		113.5		88.7
Corporate		(78.8)		(57.4)		(156.2)		(186.4)
Subtotal at fixed currency rates		481.4		414.8		830.4		653.3
Effect of foreign currency translation		3.3		11.0		5.9		27.0
Consolidated reported GAAP operating income		$484.7		$425.8		$836.3		$680.3

The profitability of the Company’s operating segments is evaluated by management based on operating income.

Consistent with the Company’s internal management reporting, Corporate amounts in the table above include sales to ChampionX in accordance with the long-term supply agreement entered into with the Transaction, as discussed in Note 14. Corporate also includes intangible asset amortization specifically from the Nalco and Purolite acquisitions and special (gains) and charges, as discussed in Note 2, that are not allocated to the Company’s reportable segments.

16. COMMITMENTS AND CONTINGENCIES

The Company is subject to various claims and contingencies related to, among other things, workers’ compensation, general liability (including product liability), automobile claims, health care claims, environmental matters and lawsuits. The Company is also subject to various claims and contingencies related to income taxes. The Company also has contractual obligations including lease commitments.

The Company records liabilities when a contingent loss is probable and can be reasonably estimated. If the reasonable estimate of a probable loss is a range, the Company records the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount. The Company discloses a contingent liability even if the liability is not probable or the amount is not estimable, or both, if there is a reasonable possibility that a material loss may have been incurred.

Insurance

Globally, the Company has insurance policies with varying deductible levels for property and casualty losses. The Company is insured for losses in excess of these deductibles, subject to policy terms and conditions and has recorded both a liability and an offsetting receivable for amounts in excess of these deductibles. The Company is self-insured for health care claims for eligible participating employees, subject to certain deductibles and limitations. The Company determines its liabilities for claims on an actuarial basis.

Litigation and Environmental Matters

The Company and certain subsidiaries are party to various lawsuits, claims and environmental actions that have arisen in the ordinary course of business. These include from time to time antitrust, employment, commercial, patent infringement, tort, product liability and wage hour lawsuits, as well as possible obligations to investigate and mitigate the effects on the environment of the disposal or release of certain chemical substances at various sites, such as Superfund sites and other operating or closed facilities. The Company has established accruals for certain lawsuits, claims and environmental matters. The Company currently believes that there is not a reasonably possible risk of material loss in excess of the amounts accrued related to these legal matters. Because litigation is inherently uncertain, and unfavorable rulings or developments could occur, there can be no certainty that the Company may not ultimately incur charges in excess of recorded liabilities. A future adverse ruling, settlement or unfavorable development could result in future charges that could have a material adverse effect on the Company’s results of operations or cash flows in the period in which they are recorded.

The Company currently believes that such future charges related to suits and legal claims, if any, would not have a material adverse effect on the Company’s consolidated financial position.

26

TPC Group Litigation

On November 27, 2019, a Butadiene production plant owned and operated by TPC Group, Inc. in Port Neches, Texas, experienced an explosion and fire that resulted in personal injuries, the release of chemical fumes and extensive property damage to the plant and surrounding areas in and near Port Neches, Texas.

Nalco Company LLC, a subsidiary of Ecolab, supplied process chemicals to TPC used in TPC’s production processes. Nalco did not operate, manage, maintain or control any aspect of TPC’s plant operations.

In connection with its provision of process chemicals to TPC, Nalco has been named in numerous lawsuits stemming from the plant explosion. Nalco has been named a defendant, along with TPC and other defendants, in multi-district litigation (“MDL”) proceedings pending in Orange County, Texas, alleging among other things claims for personal injury, property damage and business losses (In re TPC Group Litigation – A2020-0236-MDL, Orange County, Texas). In addition, numerous other lawsuits have been filed against Nalco, including TPC Group v. Nalco, E0208239, Jefferson County, Texas, a subrogation claim by TPC’s insurers seeking reimbursement for property damage losses. Over 5,000 plaintiffs (including the subrogation matter) currently have asserted claims against Nalco.

All of these cases make similar allegations and seek damages for personal injury, property damage, business losses and other damages, including exemplary damages. The Company expects all these cases will be consolidated for pretrial purposes into the Orange County MDL referenced above. Due to the large number of plaintiffs, the early stage of the litigation and the fact that many of the claims do not specify an amount of damages, any estimate of any loss or range of losses cannot be made at this time.

On June 1, 2022, TPC and seven of its affiliated companies filed for bankruptcy under Chapter 11 (Case No. 22-10493-CTG, United States Bankruptcy Court for the District of Delaware). In connection with the bankruptcy cases, TPC disclosed an estimated range of its liability related to the Port Neches incident to individuals and homeowners (including subrogation claims) of approximately $152 million to $520 million. As part of their bankruptcy plan, TPC and its affiliates announced a settlement which allows the MDL plaintiffs a $500 million claim solely for purposes of claim allowance in the chapter 11 case and distribution of value pursuant to TPC’s bankruptcy plan. Other key terms of the settlement between TPC and the MDL plaintiffs include the establishment of a settlement trust for the benefit of certain general unsecured creditors, which is funded with $30 million and the assignment of TPC’s claims and causes of action, if any, against certain third parties, including Nalco, related to the TPC plant explosion. As part of the bankruptcy process, TPC and its debtor affiliates received a discharge of all MDL related claims, as did certain non-debtor affiliates to the extent third parties did not opt out of the non-debtor releases. Nalco opted out of these releases, preserving any direct causes of action it may have against non-debtors. Furthermore, the allowance of the $500 million claim should have no effect on any claims or defenses asserted against or by Nalco in the MDL litigation. On December 1, 2022, the bankruptcy court confirmed the TPC bankruptcy plan, including the approval of the settlement and establishment of the aforementioned settlement trust. On December 16, 2022, the TPC bankruptcy plan went effective.

The Company believes the claims asserted against Nalco in the lawsuits stemming from the TPC plant explosion are without merit and intends to defend the claims vigorously. The Company also believes any potential loss should be covered by insurance subject to deductibles. However, the Company cannot predict the outcome of these lawsuits, the involvement the Company might have in these matters in the future or the potential for future litigation.

Environmental Matters

The Company is currently participating in environmental assessments and remediation at approximately 25 locations, the majority of which are in the U.S., and environmental liabilities have been accrued reflecting management’s best estimate of future costs. Potential insurance reimbursements are not anticipated in the Company’s accruals for environmental liabilities.

17. NEW ACCOUNTING PRONOUNCEMENTS

Standards That Were Adopted:
	Date of		Date of	Effect on the
Standard	Issuance	Description	Adoption	Financial Statements
ASU 2021-08 - Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers	October 2021	Update to improve the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to the recognition of an acquired contract liability and payment terms and their effect on subsequent revenue recognized by the acquirer.	January 1, 2023	The adoption of this standard did not have a significant impact on the Company's financial statements.

No other new accounting pronouncements issued or effective have had or are expected to have a material impact on the Company’s consolidated financial statements.

27

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Ecolab Inc.

Results of Review of Interim Financial Statements

We have reviewed the accompanying consolidated balance sheet of Ecolab Inc. and its subsidiaries (the “Company”) as of June 30, 2023, and the related consolidated statements of income, comprehensive income, and equity for the three-month and six-month periods ended June 30, 2023 and 2022, and the consolidated statements of cash flows for the six-month periods ended June 30, 2023 and 2022, including the related notes (collectively referred to as the “interim financial statements”). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of the Company as of December 31, 2022, and the related consolidated statements of income, comprehensive income, equity and of cash flow for the year then ended (not presented herein), and in our report dated February 24, 2023, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet information as of December 31, 2022, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

These interim financial statements are the responsibility of the Company’s management. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our review in accordance with the standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

/s/ PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Minneapolis, Minnesota

August 3, 2023

28

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

The following management discussion and analysis (“MD&A”) provides information we believe is useful in understanding our operating results, cash flows and financial condition. We provide quantitative information about the material sales drivers including the impact of changes in volume and pricing and the effect of acquisitions and changes in foreign currency at the corporate and reportable segment level. We also provide quantitative information regarding special (gains) and charges, discrete tax items and other significant factors we believe are useful for understanding our results. Such quantitative drivers are supported by comments meant to be qualitative in nature. Qualitative factors are generally ordered based on estimated significance.

The MD&A should be read in conjunction with both the unaudited consolidated financial information and related notes included in this Form 10-Q, and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2022. This discussion contains various Non-GAAP Financial Measures and also contains various Forward-Looking Statements within the meaning of the Private Securities Litigation Reform Act of 1995. We refer readers to the statements entitled “Non-GAAP Financial Measures” and “Forward-Looking Statements” located at the end of Part I of this report.

Comparability of Results

Impact of Acquisitions and Divestitures

Our non-GAAP financial measures for organic sales, organic operating income and organic operating income margin are at fixed currency and exclude the impact of special (gains) and charges, the results of our acquired businesses from the first twelve months post acquisition and the results of divested businesses from the twelve months prior to divestiture. As part of the separation of ChampionX in 2020, we entered into a Master Cross Supply and Product Transfer agreement with ChampionX to provide, receive or transfer certain products for a period of 36 months and for a small set of products with limited suppliers over the next few years. Sales of product to ChampionX under this agreement are recorded in product and equipment sales in the Corporate segment along with the related cost of sales. These transactions are removed from the consolidated results as part of the calculation of the impact of acquisitions and divestitures.

Comparability of Reportable Segments

Effective January 1, 2023, our former Downstream operating segment is now part of the Water operating segment. This change did not have any impact on the Global Industrial reportable segment.

Fixed Currency Foreign Exchange Rates

Management evaluates the sales and operating income performance of our non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminate the impact of exchange rate fluctuations on our international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. Public currency rate data provided within the “Segment Performance” section of this MD&A reflect amounts translated at actual public average rates of exchange prevailing during the corresponding period and is provided for informational purposes only.

OVERVIEW OF THE SECOND QUARTER ENDED JUNE 30, 2023

Sales Performance

When comparing second quarter 2023 against second quarter 2022, sales performance was as follows:

● Reported net sales increased 8% to $3,852.1 million and organic sales increased 9%.

● Organic sales for our Global Industrial segment increased 9% to $1,795.6 million, led by double-digit growth in Water and Food & Beverage.

● Organic sales for our Global Institutional & Specialty segment increased 13% to $1,262.2 million with double-digit growth in both Institutional and Specialty.

● Organic sales for our Global Healthcare & Life Sciences segment increased 1% to $387.5 million driven by modest growth in Healthcare sales offset by soft near-term life sciences industry demand.

● Organic sales for Other increased 9% to $362.6 million led by double-digit growth in Pest Elimination.

29

Financial Performance

When comparing second quarter 2023 against second quarter 2022, our financial performance was as follows:

● Reported operating income increased 14% to $484.7 million. Organic operating income increased 21%.

● Net income attributable to Ecolab increased 7% to $329.7 million. Excluding the impact of special (gains) and charges and discrete tax items from both 2023 and 2022 reported results, our adjusted net income attributable to Ecolab increased 13%.

● Reported diluted EPS increased 6% to $1.15. Excluding the impact of special (gains) and charges and discrete tax items from both 2023 and 2022 reported results, adjusted diluted EPS increased 13% to $1.24 in the second quarter of 2023.

● Our reported tax rate was 20.6% during the second quarter of 2023, compared to 19.7% during the second quarter of 2022. Excluding the tax rate impact of special (gains) and charges and discrete tax items from both 2023 and 2022 results, our adjusted tax rate was 19.9% during the second quarter of 2023, compared to 19.2% during the second quarter of 2022.

RESULTS OF OPERATIONS

Net Sales

	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2023		2022		Change		2023		2022		Change
Product and equipment sales		$3,104.8		$2,886.8				$5,981.1		$5,510.9
Service and lease sales		747.3		693.8				1,442.6		1,336.4
Reported GAAP net sales		$3,852.1		$3,580.6	8	%		$7,423.7		$6,847.3	8	%
Effect of foreign currency translation		(21.1)		(58.4)				(35.3)		(152.8)
Non-GAAP fixed currency sales		$3,831.0		$3,522.2	9	%		$7,388.4		$6,694.5	10	%
Effect of acquisitions and divestitures		(23.1)		(33.8)				(46.7)		(68.4)
Non-GAAP organic sales		$3,807.9		$3,488.4	9	%		$7,341.7		$6,626.1	11	%

Product and sold equipment revenue is generated from providing cleaning, sanitizing and water treatment products or selling equipment used in combination with specialized products. Service and lease equipment revenue is generated from providing services or leasing equipment to customers. All of our sales are subject to the same economic conditions.

The percentage components of the period-over-period 2023 sales change are shown below:

	Second Quarter Ended			Six Months Ended
	June 30			June 30
(percent)	2023			2023
Volume		(1)	%		(1)	%
Price changes		10			12
Organic sales change		9			11
Acquisitions and divestitures		-			-
Fixed currency sales change		9			10
Foreign currency translation		(1)			(2)
Reported GAAP net sales change		8	%		8	%

Amounts do not necessarily sum due to rounding.

Cost of Sales (“COS”) and Gross Profit Margin

	Second Quarter Ended								Six Months Ended
	June 30								June 30
	2023				2022				2023				2022
			Gross				Gross				Gross				Gross
(millions/percent)	COS		Margin		COS		Margin		COS		Margin		COS		Margin
Product and equipment cost of sales		$1,895.3				$1,799.0				$3,693.6				$3,494.6
Service and lease cost of sales		439.5				412.1				846.4				789.9
Reported GAAP COS and gross margin		$2,334.8	39.4	%		$2,211.1	38.2	%		$4,540.0	38.8	%		$4,284.5	37.4	%
Special (gains) and charges		8.1				1.7				11.3				54.6
Non-GAAP adjusted COS and gross margin		$2,326.7	39.6	%		$2,209.4	38.3	%		$4,528.7	39.0	%		$4,229.9	38.2	%

Our COS and corresponding gross profit margin (“gross margin”) are shown in the table above. Gross margin is defined as net sales less cost of sales divided by net sales.

30

Our reported gross margin was 39.4% and 38.2% for the second quarter of 2023 and 2022, respectively. Our reported gross margin was 38.8% and 37.4% for the first six months of 2023 and 2022, respectively. Special (gains) and charges included in items impacting cost of sales are shown within the “Special (Gains) and Charges” table below.

Excluding the impact of special (gains) and charges within COS, second quarter 2023 and 2022 adjusted gross margin was 39.6% and 38.3%, respectively, and for the first six months of 2023 and 2022 was 39.0% and 38.2%, respectively.

Our adjusted gross margin increased when comparing the second quarter of 2023 against the second quarter of 2022, as strong pricing overcame continued increases in delivered product costs and unfavorable mix.

Selling, General and Administrative Expense

Selling, general and administrative (“SG&A”) expenses as a percentage of sales were 26.3% and 27.0% for the second quarter and first six months of 2023, respectively, compared to 26.3% and 27.1% for the second quarter and first six months of 2022, respectively. The SG&A ratio to sales in the second quarter of 2023 remained flat driven by sales leverage and cost savings that were offset by higher incentive compensation and investments in the business.

Special (Gains) and Charges

Special (gains) and charges reported on the Consolidated Statements of Income include the following items:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Cost of sales
Restructuring activities		$8.1		$0.8		$11.3		$3.4
Acquisition and integration activities		-		0.9		-		28.5
Russia/Ukraine		-		-		-		6.4
Other		-		-		-		16.3
Cost of sales subtotal		8.1		1.7		11.3		54.6
Special (gains) and charges
Restructuring activities		13.7		0.3		26.3		1.1
Acquisition and integration activities		3.5		3.4		8.5		10.9
Russia/Ukraine		0.3		(5.7)		0.6		5.9
Other		3.5		5.6		10.1		9.8
Special (gains) and charges subtotal		21.0		3.6		45.5		27.7
Total special (gains) and charges		$29.1		$5.3		$56.8		$82.3

For segment reporting purposes, special (gains) and charges are not allocated to reportable segments, which is consistent with our internal management reporting.

Restructuring activities

Restructuring activities are primarily related to the Combined Program which are described below. These activities have been included as a component of cost of sales and special (gains) and charges on the Consolidated Statements of Income. Restructuring liabilities have been classified as a component of other current and other noncurrent liabilities on the Consolidated Balance Sheets.

Further details related to our restructuring charges are included in Note 2.

Combined Program

In November 2022 we approved a Europe cost savings program. In connection with these actions, we expected to incur pre-tax charges of $130 million ($110 million after tax) or $0.38 per diluted share. In February 2023, we expanded our previously announced Europe cost savings program to focus on its Institutional and Healthcare businesses in other regions. In connection with the expanded program (“Combined Program”), we expect to incur total pre-tax charges of $195 million ($150 million after tax) or $0.52 per diluted share. We expect that these restructuring charges will be completed by 2024. Program actions include headcount reductions from terminations, not filling certain open positions, and facility closures. The Combined Program charges are expected to be primarily cash expenditures related to severance and asset disposals.

In anticipation of this Combined Program, a limited number of actions were taken in the fourth quarter of 2022. As a result, we reclassified $19.3 million ($14.5 million after tax) or $0.05 per diluted share from other restructuring to the Combined Program in the first quarter of 2023.

31

During the second quarter and first six months of 2023 we recorded total Combined Program restructuring charges of $19.7 million ($16.2 million after tax) or $0.06 per diluted share and $33.1 million ($26.4 million after tax) or $0.09 per diluted share, respectively, primarily related to severance. The net liability related to the Combined Program was $57.2 million and $62.0 million as of June 30, 2023 and December 31, 2022, respectively. The remaining liability is expected to be paid over a period of a few months to several quarters and will continue to be funded from operating activities.

The Combined Program has delivered $67 million of cumulative cost savings with estimated annualized cost savings of $175 million in continuing operations by 2024.

Institutional Advancement Program

We approved a restructuring plan in 2020 focused on the Institutional business (“the Institutional Plan”) which is intended to enhance our Institutional sales and service structure and allow the sales team to capture share and penetration while maximizing service effectiveness by leveraging our ongoing investments in digital technology. In February 2021, we expanded the Institutional Plan, and we expect that these restructuring charges will be completed in 2023, with total anticipated costs of $70 million ($55 million after tax) or $0.19 per diluted share. The remaining costs are expected to be primarily non-cash charges related to equipment disposals. Actual costs may vary from these estimates depending on actions taken.

In the second quarter and first six months of 2023, we recorded restructuring charges of $2.1 million ($1.6 million after tax) or less than $0.01 per diluted share and $4.5 million ($3.4 million after tax) or $0.01 per diluted share, respectively, primarily related to disposals of equipment. We have recorded $58.6 million ($44.8 million after tax), or $0.16 per diluted share of cumulative restructuring charges under the Institutional Plan. Net cash payments were $0.7 million and $3.1 million and non-cash net charges were $1.6 million and $3.3 million for the second quarter and first six months of 2023, respectively. The liability related to the Institutional Plan was $0 million and $1.9 million as of June 30, 2023 and December 31, 2022, respectively.

The Institutional Plan has delivered $52 million of annual cost savings.

Accelerate 2020

During 2018, we formally commenced a restructuring plan Accelerate 2020 (“the A2020 Plan”), to leverage technology and system investments and organizational changes. The goals of the Plan were to further simplify and automate processes and tasks, reduce complexity and management layers, consolidate facilities and focus on key long-term growth areas by further leveraging technology and structural improvements. The restructuring activities were completed at the end of 2022, with total costs of $254 million ($198 million after tax), or $0.69 per diluted share.

Net cash payments were $5.4 million and $9.5 million for the second quarter and first six months of 2023, respectively. The liability related to the Plan was $8.6 million and $18.1 million as of June 30, 2023 and December 31, 2022, respectively. The remaining liability is expected to be paid over a period of a few months to several quarters which continue to be funded from operating activities.

The A2020 Plan has delivered $315 million of cumulative cost savings.

Other Restructuring Activities

During the second quarter and first six months of 2022, we incurred restructuring charges of $0.3 million ($0.2 million after tax), or less than $0.01 per diluted share and $2.0 million ($1.5 million after tax), or less than $0.01 per diluted share, respectively, related to other immaterial restructuring activity.

The restructuring liability balance for all other restructuring plans excluding the Combined Program, the A2020 Plan and the Institutional Plan was $3.7 million and $23.2 million as of June 30, 2023 and December 31, 2022, respectively. The decrease in liability was driven primarily by the reclass of $19.3 million from other restructuring to the Combined Program in the first six months of 2023. Cash payments during the second quarter and first six months of 2023 related to all other restructuring plans excluding the Combined Program, the A2020 Plan and the Institutional Plan were $0 million and $0.2 million, respectively.

Acquisition and integration related costs

Acquisition and integration costs reported in product and equipment cost of sales on the Consolidated Statements of Income in the second quarter and first six months of 2022 include $0.9 million ($0.6 million after tax) or less than $0.01 per diluted share and $28.5 million ($21.6 million after tax) or $0.08 per diluted share, respectively, related primarily to the recognition of fair value step-up in the Purolite Corporation (“Purolite”) inventory.

Acquisition and integration related costs reported in special (gains) and charges on the Consolidated Statements of Income include $3.5 million ($2.7 million after tax) or $0.01 per diluted share and $8.5 million ($6.4 million after tax) or $0.02 per diluted share in the second quarter and first six months of 2023, respectively. Charges are integration related costs primarily related to the Purolite acquisition.

32

Russia/Ukraine activities

In light of Russia’s invasion of Ukraine and the sanctions against Russia by the United States and other countries, we have made the determination that we will limit our Russian business to operations that are essential to life, providing minimal support for our healthcare, life sciences, food and beverage and certain water businesses. We incurred charges of $0.3 million ($0.2 million after tax) or less than $0.01 per diluted share and recoveries of ($5.7) million (($5.7) million after tax) or $0.02 per diluted share in the second quarter of 2023 and 2022, respectively, and charges of $0.6 million ($0.5 million after tax) or less than $0.01 per diluted share and charges of $12.3 million ($13.3 million after tax) or $0.05 per diluted share in the first six months of 2023 and 2022, respectively, primarily related to recoverability risk of certain assets in both Russia and Ukraine.

Other operating activities

Other special charges recorded in product and equipment cost of sales and special (gains) and charges on the Consolidated Statements of Income in the second quarter of 2023 and 2022 were $3.5 million ($2.6 million after tax) or $0.01 per diluted share and $5.6 million ($4.4 million after tax) or $0.02 per diluted share, respectively, and in the first six months of 2023 and 2022 were $10.1 million ($7.7 million after tax) or $0.03 per diluted share and $26.1 million ($19.7 million after tax) or $0.07 per diluted share, respectively, primarily related to certain legal charges and 2022 COVID-19 related inventory charges.

Operating Income and Operating Income Margin

	Second Quarter Ended								Six Months Ended
	June 30								June 30
(millions)	2023			2022					2023			2022
Reported GAAP operating income		$484.7			$425.8		14	%		$836.3			$680.3		23	%
Special (gains) and charges		29.1			5.3					56.8			82.3
Non-GAAP adjusted operating income		513.8			431.1		19	%		893.1			762.6		17	%
Effect of foreign currency translation		(3.6)			(9.8)					(6.3)			(25.8)
Non-GAAP adjusted fixed currency operating income		510.2			421.3		21	%		886.8			736.8		20	%
Effect of acquisitions and divestitures		(1.5)			-					(2.0)			-
Non-GAAP organic operating income		$508.7			$421.3		21	%		$884.8			$736.8		20	%
	Second Quarter Ended								Six Months Ended
	June 30								June 30
(percent)	2023			2022					2023			2022
Reported GAAP operating income margin		12.6	%		11.9	%				11.3	%		9.9	%
Non-GAAP adjusted operating income margin		13.3	%		12.0	%				12.0	%		11.1	%
Non-GAAP adjusted fixed currency operating income margin		13.3	%		12.0	%				12.0	%		11.0	%
Non-GAAP organic operating income margin		13.4	%		12.1	%				12.1	%		11.1	%

Our operating income and corresponding operating income margin are shown in the previous tables. Operating income margin is defined as operating income divided by net sales.

Our reported operating income increased 14% and 23% in the second quarter and first six months of 2023, respectively, versus the comparable periods of 2022. Our reported operating income for 2023 and 2022 was impacted by special (gains) and charges; excluding the impact of special (gains) and charges from 2023 and 2022 reported results, our adjusted operating income increased 19% and 17% in the second quarter and first six months of 2023.

As shown in the previous table, foreign currency had a 2 and 3 percentage point impact on adjusted operating income growth for the second quarter and first six months of 2023, respectively. Foreign currency had a 4 percentage points impact on adjusted operating income growth for both the second quarter and first six months of 2022.

Other (Income) Expense

	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2023		2022		Change		2023		2022		Change
Reported GAAP other (income) expense		($14.4)		($19.5)	(26)	%		($27.5)		($38.3)	(28)	%

Other income decreased to $14.4 million from $19.5 million in the second quarter of 2023 compared to the second quarter of 2022, respectively, and decreased to $27.5 million from $38.3 million in the first six months of 2023 compared to the first six months of 2022, respectively, driven by higher pension costs.

33

Interest Expense, Net

	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2023		2022		Change		2023		2022		Change
Reported GAAP interest expense, net		$77.8		$56.0	39	%		$152.0		$109.0	39	%

Reported net interest expense was $77.8 million and $56.0 million in the second quarter of 2023 and 2022, respectively, and $152.0 million and $109.0 million in the first six months of 2023 and 2022, respectively. The increase in interest expense reflected the impact from higher average interest rates on outstanding debt.

Provision for Income Taxes

The following table provides a summary of our tax rate:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(percent)	2023		2022		2023		2022
Reported GAAP tax rate	20.6	%	19.7	%	19.5	%	20.0	%
Tax rate impact of:
Special (gains) and charges	(0.1)		0.4		0.2		-
Discrete tax items	(0.6)		(0.9)		0.2		(0.7)
Non-GAAP adjusted tax rate	19.9	%	19.2	%	19.9	%	19.3	%

Our reported tax rate was 20.6% and 19.7% for the second quarter of 2023 and 2022, respectively and 19.5% and 20.0% for the first six months of 2023 and 2022, respectively. The change in our tax rate for the second quarter and first six months of 2023 versus the comparable periods of 2022 was driven primarily by discrete tax items and special (gains) and charges. The change in our tax rate includes the tax impact of special (gains) and charges and discrete tax items, which have impacted the comparability of our historical reported tax rates, as amounts included in our special (gains) and charges are derived from tax jurisdictions with rates that vary from our tax rate, and discrete tax items are not necessarily consistent across periods. The tax impact of special (gains) and charges and discrete tax items will likely continue to impact comparability of our reported tax rate in the future.

We recognized net tax expense related to discrete tax items of $2.8 million and a net tax benefit of $1.2 million in the second quarter and first six months of 2023, respectively. This included share-based compensation excess tax benefits of $1.8 million and $1.9 million in the second quarter and first six months of 2023, respectively. Additionally, we recognized net tax expense related to discrete tax items of $4.6 million and $0.7 million in the second quarter and first six months of 2023, respectively, primarily due to audit settlements, uncertain tax positions, prior year return adjustments, repricing of deferred tax balances, and other changes in estimates.

We recognized net tax expense related to discrete tax items of $3.7 million and $4.7 million in the second quarter and first six months of 2022, respectively. This included share-based compensation excess tax benefits of $0.7 million and $3.6 million in the second quarter and first six months of 2022, respectively. Additionally, we recognized discrete tax expense of $4.4 million and $8.3 million in the second quarter and first six months of 2022, respectively, primarily due to audit settlements, uncertain tax positions, prior year return adjustments, repricing of deferred tax balances, and other changes in estimates.

34

Net Income Attributable to Ecolab

	Second Quarter Ended							Six Months Ended
	June 30							June 30
(millions)	2023		2022		Change			2023		2022		Change
Reported GAAP net income attributable to Ecolab		$329.7		$308.3		7	%		$563.1		$480.2		17	%
Adjustments:
Special (gains) and charges, after tax		23.3		2.6					44.4		66.2
Discrete tax net expense		2.8		3.7					(1.2)		4.7
Non-GAAP adjusted net income attributable to Ecolab		$355.8		$314.6		13	%		$606.3		$551.1		10	%

Diluted EPS

	Second Quarter Ended							Six Months Ended
	June 30							June 30
(dollars)	2023		2022		Change			2023		2022		Change
Reported GAAP diluted EPS		$1.15		$ 1.08		6	%		$1.97		$ 1.67		18	%
Adjustments:
Special (gains) and charges, after tax		0.08		0.01					0.15		0.23
Discrete tax net expense		0.01		0.01					-		0.02
Non-GAAP adjusted diluted EPS		$1.24		$ 1.10		13	%		$2.12		$ 1.92		10	%

Per share amounts in the above tables do not necessary sum due to rounding.

Currency translation had an unfavorable impact of approximately ($0.03) and ($0.08) per share on diluted EPS for the second quarter and first six months of 2023, when compared to the comparable periods of 2022.

SEGMENT PERFORMANCE

The non-U.S. dollar functional international amounts included within our reportable segments are based on translation into U.S. dollars at the fixed currency exchange rates used by management for 2023. The difference between the fixed currency exchange rates and the actual currency exchange rates is reported as “effect of foreign currency translation” in the following tables. All other accounting policies of the reportable segments are consistent with U.S. GAAP and the accounting policies described in Note 2 of our Annual Report on Form 10-K for the year ended December 31, 2022. Additional information about our reportable segments is included in Note 15.

Fixed currency net sales and operating income for the second quarter and first six months of 2023 and 2022 for our reportable segments are shown in the following tables:

Net Sales	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2023		2022		Change		2023		2022		Change
Global Industrial		$1,795.6		$1,653.3	9	%		$3,494.9		$3,164.7	10	%
Global Institutional & Specialty		1,268.6		1,118.2	13			2,395.2		2,109.5	14
Global Healthcare & Life Sciences		387.5		384.4	1			766.1		732.6	5
Other		362.6		332.5	9			691.9		619.3	12
Corporate		16.7		33.8	(51)			40.3		68.4	(41)
Subtotal at fixed currency		3,831.0		3,522.2	9			7,388.4		6,694.5	10
Effect of foreign currency translation		21.1		58.4				35.3		152.8
Consolidated reported GAAP net sales		$3,852.1		$3,580.6	8	%		$7,423.7		$6,847.3	8	%
Operating Income	Second Quarter Ended						Six Months Ended
	June 30						June 30
(millions)	2023		2022		Change		2023		2022		Change
Global Industrial		$255.4		$216.8	18	%		$471.0		$396.7	19	%
Global Institutional & Specialty		208.7		148.6	40			334.4		257.2	30
Global Healthcare & Life Sciences		32.7		55.2	(41)			67.7		97.1	(30)
Other		63.4		51.6	23			113.5		88.7	28
Corporate		(78.8)		(57.4)	(37)			(156.2)		(186.4)	16
Subtotal at fixed currency		481.4		414.8	16			830.4		653.3	27
Effect of foreign currency translation		3.3		11.0				5.9		27.0
Consolidated reported GAAP operating income		$484.7		$425.8	14	%		$836.3		$680.3	23	%

35

The following tables reconcile the impact of acquisitions and divestitures within our reportable segments:

	Second Quarter Ended
	June 30
Net Sales	2023			2022
(millions)	Fixed Currency	Impact of Acquisitions and Divestitures	Organic	Fixed Currency	Impact of Acquisitions and Divestitures	Organic
Global Industrial	$1,795.6	$-	$1,795.6	$1,653.3	$-	$1,653.3
Global Institutional & Specialty	1,268.6	(6.4)	1,262.2	1,118.2	-	1,118.2
Global Healthcare & Life Sciences	387.5	-	387.5	384.4	-	384.4
Other	362.6	-	362.6	332.5	-	332.5
Corporate	16.7	(16.7)	-	33.8	(33.8)	-
Subtotal at fixed currency	3,831.0	(23.1)	3,807.9	3,522.2	(33.8)	3,488.4
Effect of foreign currency translation	21.1			58.4
Consolidated reported GAAP net sales	$3,852.1			$3,580.6
Operating Income	2023			2022
(millions)	Fixed Currency	Impact of Acquisitions and Divestitures	Organic	Fixed Currency	Impact of Acquisitions and Divestitures	Organic
Global Industrial	$255.4	$-	$255.4	$216.8	$-	$216.8
Global Institutional & Specialty	208.7	(0.7)	208.0	148.6	-	148.6
Global Healthcare & Life Sciences	32.7	-	32.7	55.2	-	55.2
Other	63.4	-	63.4	51.6	-	51.6
Corporate	(50.0)	(0.8)	(50.8)	(50.9)	-	(50.9)
Non-GAAP adjusted fixed currency operating income	510.2	(1.5)	508.7	421.3	-	421.3
Special (gains) and charges	28.8			6.5
Subtotal at fixed currency	481.4			414.8
Effect of foreign currency translation	3.3			11.0
Consolidated reported GAAP operating income	$484.7			$425.8
	Six Months Ended
	June 30
Net Sales	2023			2022
(millions)	Fixed Currency	Impact of Acquisitions and Divestitures	Organic	Fixed Currency	Impact of Acquisitions and Divestitures	Organic
Global Industrial	$3,494.9	$-	$3,494.9	$3,164.7	$-	$3,164.7
Global Institutional & Specialty	2,395.2	(6.4)	2,388.8	2,109.5	-	2,109.5
Global Healthcare & Life Sciences	766.1	-	766.1	732.6	-	732.6
Other	691.9	-	691.9	619.3	-	619.3
Corporate	40.3	(40.3)	-	68.4	(68.4)	-
Subtotal at fixed currency	7,388.4	(46.7)	7,341.7	6,694.5	(68.4)	6,626.1
Effect of foreign currency translation	35.3			152.8
Consolidated reported GAAP net sales	$7,423.7			$6,847.3
Operating Income	2023			2022
(millions)	Fixed Currency	Impact of Acquisitions and Divestitures	Organic	Fixed Currency	Impact of Acquisitions and Divestitures	Organic
Global Industrial	$471.0	$-	$471.0	$396.7	$-	$396.7
Global Institutional & Specialty	334.4	(0.7)	333.7	257.2	-	257.2
Global Healthcare & Life Sciences	67.7	-	67.7	97.1	-	97.1
Other	113.5	-	113.5	88.7	-	88.7
Corporate	(99.8)	(1.3)	(101.1)	(102.9)	-	(102.9)
Non-GAAP adjusted fixed currency operating income	886.8	(2.0)	884.8	736.8	-	736.8
Special (gains) and charges	56.4			83.5
Subtotal at fixed currency	830.4			653.3
Effect of foreign currency translation	5.9			27.0
Consolidated reported GAAP operating income	$836.3			$680.3

36

Unless otherwise noted, the following segment performance commentary compares the second quarter and first six months of 2023 against the second quarter and first six months of 2022.

Global Industrial

	Second Quarter Ended						Six Months Ended
	June 30						June 30
	2023			2022			2023			2022
Sales at fixed currency (millions)		$1,795.6			$1,653.3			$3,494.9			$3,164.7
Sales at public currency (millions)		1,808.5			1,689.9			3,517.9			3,255.6
Volume		(2)	%					(2)	%
Price changes		11	%					13	%
Organic sales change		9	%					10	%
Acquisitions and divestitures		-	%					-	%
Fixed currency sales change		9	%					10	%
Foreign currency translation		(1)	%					(2)	%
Public currency sales change		7	%					8	%
Operating income at fixed currency (millions)		$255.4			$216.8			$471.0			$396.7
Operating income at public currency (millions)		257.6			224.1			475.3			415.2
Fixed currency operating income change		18	%					19	%
Fixed currency operating income margin		14.2	%		13.1	%		13.5	%		12.5	%
Organic operating income change		18	%					19	%
Organic operating income margin		14.2	%		13.1	%		13.5	%		12.5	%
Public currency operating income change		15	%					14	%

Percentages in the above table do not necessarily sum due to rounding.

Net Sales

Organic sales for Global Industrial increased in the second quarter and first six months of 2023, led by double-digit growth in Water and Food & Beverage.

Water organic sales increased 10% and 12% in the second quarter and first six months of 2023, respectively, driven by robust pricing and new business wins. Light industry reported robust sales growth driven by continued strong performance across data centers, microelectronics, and institutional. Heavy industry recorded strong sales growth led by primary metals and chemicals​ sales. Downstream industry reported strong sales growth driven by water treatment. Food ​& Beverage organic sales increased 11% and 12% in the second quarter and first six months of 2023, respectively, reflecting strong sales growth driven by continued pricing. Paper organic sales increased 1% and 4% in the second quarter and first six months of 2023, respectively, driven by modest sales growth as strong pricing and new business wins offset continued easing in customer production rates.

Operating Income

Organic operating income and organic operating income margins increased for Global Industrial in both the second quarter and first six months of 2023, respectively.

Organic operating income margins increased 1.1 percentage points during the second quarter of 2023, as the 8.4 percentage point positive impact of strong pricing overcame the 7.0 percentage point negative impacts of lower volume, higher delivered product costs, and investments in the business including incentive compensation. Organic operating income margins increased 1.0 percentage point during the first six months of 2023, as the 9.9 percentage point positive impact of strong pricing overcame the 9.0 percentage point negative impacts of higher delivered product costs, lower volume, and investments in the business.

37

Global Institutional & Specialty

	Second Quarter Ended						Six Months Ended
	June 30						June 30
	2023			2022			2023			2022
Sales at fixed currency (millions)		$1,268.6			$1,118.2			$2,395.2			$2,109.5
Sales at public currency (millions)		1,272.2			1,129.3			2,401.0			2,138.7
Volume		2	%					2	%
Price changes		11	%					12	%
Organic sales change		13	%					13	%
Acquisitions and divestitures		1	%					-	%
Fixed currency sales change		13	%					14	%
Foreign currency translation		(1)	%					(1)	%
Public currency sales change		13	%					12	%
Operating income at fixed currency (millions)		$208.7			$148.6			$334.4			$257.2
Operating income at public currency (millions)		209.2			150.6			335.1			261.5
Fixed currency operating income change		40	%					30	%
Fixed currency operating income margin		16.5	%		13.3	%		14.0	%		12.2	%
Organic operating income change		40	%					30	%
Organic operating income margin		16.5	%		13.3	%		14.0	%		12.2	%
Public currency operating income change		39	%					28	%

Percentages in the above table do not necessarily sum due to rounding.

Net Sales

Organic sales for Global Institutional & Specialty increased in the second quarter and first six months of 2023, with double-digit growth in both the Institutional and Specialty divisions.

At an operating segment level, Institutional organic sales increased 12% and 13% in the second quarter and first six months of 2023, respectively, driven by strong sales growth driven by robust pricing and new business wins. Specialty organic sales increased 15% and 14% in the second quarter and first six months of 2023, respectively, driven by robust sales growth driven by strong quick service sales and good growth in food retail.

Operating Income

Organic operating income and organic operating income margin increased in both the second quarter and first six months of 2023 for our Global Institutional & Specialty segment.

Organic operating income margins increased 3.2 percentage points during the second quarter of 2023, as the 7.8 percentage point positive impact from strong pricing overcame 3.8 percentage point negative impacts from investments in the business including incentive compensation, and higher delivered product cost. Organic operating income margins increased 1.8 percentage points during the first six months of 2023, as the 8.0 percentage point positive impact from strong pricing overcame 5.8 percentage point negative impacts from investments in the business and higher supply chain costs.

38

Global Healthcare & Life Sciences

	Second Quarter Ended						Six Months Ended
	June 30						June 30
	2023			2022			2023			2022
Sales at fixed currency (millions)		$387.5			$384.4			$766.1			$732.6
Sales at public currency (millions)		390.8			390.9			770.5			753.7
Volume		(5)	%					(3)	%
Price changes		6	%					8	%
Organic sales change		1	%					5	%
Acquisitions and divestitures		-	%					-	%
Fixed currency sales change		1	%					5	%
Foreign currency translation		(1)	%					(2)	%
Public currency sales change		-	%					2	%
Operating income at fixed currency (millions)		$32.7			$55.2			$67.7			$97.1
Operating income at public currency (millions)		33.3			56.6			68.5			100.9
Fixed currency operating income change		(41)	%					(30)	%
Fixed currency operating income margin		8.4	%		14.4	%		8.8	%		13.3	%
Organic operating income change		(41)	%					(30)	%
Organic operating income margin		8.4	%		14.4	%		8.8	%		13.3	%
Public currency operating income change		(41)	%					(32)	%

Percentages in the above table do not necessarily sum due to rounding.

Net Sales

Organic sales for Global Healthcare & Life Sciences increased in both the second quarter and first six months of 2023 driven by modest growth in Healthcare sales offset by soft near-term life sciences industry demand.

At an operating segment level, Healthcare organic sales increased 2% and 4% in the second quarter and first six months of 2023, respectively, as good growth in North America more than offset softness in Europe​. Life Sciences organic sales decreased -1% in the second quarter and increased 4% in the first six months of 2023 driven by good pricing offset by soft near-term industry demand.

Operating Income

Organic operating income and organic operating income margins decreased for our Global Healthcare & Life Sciences segment in both the second quarter and first six months of 2023.

Organic operating income margins decreased 6.0 percentage points during the second quarter of 2023, as the 4.5 percentage point positive impact from strong pricing was more than offset by the 11.3 percentage point negative impacts from lower volume, targeted investments in the business, and higher supply chain costs. Organic operating income margins decreased 4.5 percentage points during the first six months of 2023, as the 5.9 percentage point positive impact from strong pricing was more than offset by the 9.8 percentage point negative impacts from lower volume, targeted investments in the business, and higher delivered product costs.

39

Other

	Second Quarter Ended						Six Months Ended
	June 30						June 30
	2023			2022			2023			2022
Sales at fixed currency (millions)		$362.6			$332.5			$691.9			$619.3
Sales at public currency (millions)		363.9			336.6			693.9			630.6
Volume		1	%					3	%
Price changes		8	%					9	%
Organic sales change		9	%					12	%
Acquisitions and divestitures		-	%					-	%
Fixed currency sales change		9	%					12	%
Foreign currency translation		(1)	%					(1)	%
Public currency sales change		8	%					10	%
Operating income at fixed currency (millions)		$63.4			$51.6			$113.5			$88.7
Operating income at public currency (millions)		63.5			52.2			113.7			90.1
Fixed currency operating income change		23	%					28	%
Fixed currency operating income margin		17.5	%		15.5	%		16.4	%		14.3	%
Organic operating income change		23	%					28	%
Organic operating income margin		17.5	%		15.5	%		16.4	%		14.3	%
Public currency operating income change		22	%					26	%

Percentages in the above table do not necessarily sum due to rounding.

Net Sales

Organic sales for Other increased in both the second quarter and first six months of 2023 led by double-digit growth in Pest Elimination.

At an operating segment level, Pest Elimination organic sales increased 11% and 12% in the second quarter and first six months of 2023, respectively, reflecting strong sales growth led by double-digit gains in restaurants, food & beverage, food retail, and hospitality​. Textile Care organic sales increased 8% and 12% in the second quarter and first six months of 2023, respectively. Colloidal Technologies Group organic sales increased 1% and 10% in the second quarter and first six months of 2023, respectively.

Operating Income

Organic operating income and organic operating income margins increased for Other in both the second quarter and first six months of 2023.

Organic operating income margins increased 2.0 percentage points during the second quarter of 2023, as the 6.0 percentage point positive impact from strong pricing overcame the 4.1 percentage point negative impacts of investments in the business including incentive compensation, and unfavorable mix. Organic operating income margins increased 2.1 percentage points during the first six months of 2023, as the 7.2 percentage point positive impact from strong pricing overcame the 4.9 percentage point negative impacts of investments in the business and unfavorable mix.

Corporate

Consistent with our internal management reporting, Corporate amounts in the table on page 35 include sales to ChampionX in accordance with the long-term supply agreement entered into with the Transaction post-separation, as discussed in Note 14, intangible asset amortization specifically from the Nalco and Purolite transactions and special (gains) and charges that are not allocated to our reportable segments. Items included within special (gains) and charges are shown in the table on page 31.

40

FINANCIAL POSITION, CASH FLOWS AND LIQUIDITY

Financial Position

Total assets were $21.5 billion as of June 30, 2023, compared to total assets of $21.5 billion as of December 31, 2022.

Total liabilities were $13.9 billion as of June 30, 2023, compared to total liabilities of $14.2 billion as of December 31, 2022. Total debt was $8.6 billion as of June 30, 2023 and $8.6 billion as of December 31, 2022. See further discussion of our debt activity within the “Liquidity and Capital Resources” section of this MD&A.

Our net debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”) is shown in the following table. EBITDA is a non-GAAP measure discussed further in the “Non-GAAP Financial Measures” section of this MD&A.

The inputs to EBITDA reflect the trailing twelve months of activity for the period presented:

	June 30, 2023		December 31, 2022
(ratio)
Net debt to EBITDA		3.0		3.2
(millions)
Total debt		$8,621.5		$8,580.4
Cash		554.2		598.6
Net debt		$8,067.3		$7,981.8
Net income including noncontrolling interest		$1,194.3		$1,108.9
Provision for income taxes		251.3		234.5
Interest expense, net		286.6		243.6
Depreciation		618.6		618.5
Amortization		314.4		320.2
EBITDA		$2,665.2		$2,525.7

Cash Flows

Operating Activities

	Six Months Ended
	June 30
(millions)	2023		2022		Change
Cash provided by operating activities		$771.6		$492.5		$279.1

We continue to generate cash flow from operations, allowing us to fund our ongoing operations, acquisitions, investments in the business and pension obligations along with returning cash to our shareholders through dividend payments and share repurchases. Cash provided by operating activities increased $279 million in the first six months of 2023 compared to the first six months of 2022, driven primarily by a $154 million net favorable change in working capital and $85 million increase in net income. The cash flow impact from working capital was primarily driven by improvement in inventory and receivables offset by a decrease in accounts payable.

Investing Activities

	Six Months Ended
	June 30
(millions)	2023		2022		Change
Cash used for investing activities		($463.5)		($310.8)		($152.7)

Cash used for investing activities is primarily impacted by capital investments in the business.

We continue to make capital investments in the business, including merchandising equipment, manufacturing equipment and facilities. Total capital expenditures were $346 million and $318 million in the first six months of 2023 and 2022, respectively.

Total cash paid for acquisitions, net of cash acquired along with net cash received from dispositions, during the first six months of 2023 and 2022, was $105 million and $7 million, respectively. Our acquisitions are discussed further in Note 3. We continue to target strategic business acquisitions which complement our growth strategy and expect to continue to make capital investments and acquisitions in the future to support our long-term growth.

41

Financing Activities

	Six Months Ended
	June 30
(millions)	2023		2022		Change
Cash used for financing activities		($322.2)		($428.2)		$106.0

Our cash flows from financing activities primarily reflect the issuances and repayment of debt, common stock repurchases, proceeds from common stock issuances related to our equity incentive programs and dividend payments.

We had net issuances of commercial paper and notes payable of $2 million and $208 million in the first six months of 2023 and 2022, respectively.

Shares are repurchased for the purpose of partially offsetting the dilutive effect of our equity compensation plans, to manage our capital structure and to efficiently return capital to shareholders. We reacquired a total of $11 million and $403 million of shares in the first six months of 2023 and 2022, respectively. Cash proceeds and tax benefits from stock option exercises provide a portion of the funding for repurchase activity.

There was no long-term debt issuance or repayment activity through the first six months of 2023 or 2022.

We paid dividends of $309 million and $300 million in the first six months of 2023 and 2022, respectively.

Liquidity and Capital Resources

We currently expect to fund the cash requirements which are reasonably foreseeable for the next twelve months, including scheduled debt repayments, new investments in the business, share repurchases, dividend payments, possible business acquisitions and pension and postretirement contributions with cash from operating activities, and as needed, additional short-term and/or long-term borrowings. We continue to expect our operating cash flow to remain strong.

As of June 30, 2023, we had $554 million of cash and cash equivalents on hand, of which $43 million was held outside of the U.S. We will continue to evaluate our cash position in light of future developments.

As of June 30, 2023, we have a $2.0 billion multi-year credit facility which expires in April 2026. The credit facility has been established with a diverse syndicate of banks and supports our U.S. and Euro commercial paper programs. The maximum aggregate amount of commercial paper that may be issued under our U.S. commercial paper program and our Euro commercial paper program may not exceed $2.0 billion. At the end of the second quarter of 2023, we had no outstanding commercial paper under our U.S. program nor our Euro program. At the end of the second quarter of 2022, we had $604 million outstanding commercial paper under our U.S. program and no outstanding commercial paper under our Euro program. There were no borrowings under our credit facility as of June 30, 2023 or 2022. As of June 30, 2023, both programs were rated A-2 by Standard & Poor’s, P-2 by Moody’s and F-1 by Fitch.

There was no long-term debt issuance or repayment activity through the first six months of 2023.

We are in compliance with our debt covenants and other requirements of our credit agreements and indentures. We believe we have sufficient borrowing capacity to meet our foreseeable operating activities, as needed.

The schedule of contractual obligations included in the Financial Position and Liquidity section of our Form 10-K for the year ended December 31, 2022 disclosed total notes payable and long-term debt due within one year of $505 million. As of June 30, 2023, the total notes payable and long-term debt due within one year was $1.1 billion. We had no outstanding commercial paper under our U.S. program as of June 30, 2023 and as of December 31, 2022.

Our gross liability for uncertain tax positions was $21 million as of June 30, 2023 and $25 million as of December 31, 2022. We are not able to reasonably estimate the amount by which the liability will increase or decrease over time; however, at this time, we do not expect significant payments related to these obligations within the next year.

GLOBAL ECONOMIC ENVIRONMENT

Global Economies

Approximately half of our sales are outside of the U.S. Our international operations subject us to changes in economic conditions and foreign currency exchange rates as well as political uncertainty in some countries which could impact future operating results. We expect a more challenging macroeconomic environment, especially in Europe, as the war and weak economic growth are having a significant impact on costs and demand. We also assume easing but ongoing delivered product cost inflation and for interest rates to remain high through 2023.

Argentina and Turkey are classified as highly inflationary economies in accordance with U.S. GAAP, and the U.S. dollar is the functional currency for our subsidiaries in Argentina and Turkey. During the first six months of 2023, sales in Argentina represented less than 1% of our consolidated sales. Assets held in Argentina at the end of the first six months of 2023 represented less than 1% of our consolidated

42

assets. During the first six months of 2023, sales in Turkey represented less than 1% of our consolidated sales. Assets held in Turkey at the end of the first six months of 2023 represented less than 1% of our consolidated assets.

In light of Russia’s invasion of Ukraine and the sanctions against Russia by the United States and other countries, we have made the determination that we will limit our Russian business to operations that are essential to life, providing minimal support for our healthcare, life sciences, food and beverage and certain water businesses. We may further narrow our presence in Russia depending on future developments. During the first six months of 2023, our Russian and Ukraine operations represented approximately 1% of our 2023 consolidated net sales.

NEW ACCOUNTING PRONOUNCEMENTS

For information on new accounting pronouncements, refer to Note 17 to the Consolidated Financial Statements.

NON-GAAP FINANCIAL MEASURES

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operation” in Item 2, contains financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S. (GAAP). These non-GAAP measures include:

● Fixed currency sales

● Organic sales, formerly known as acquisition adjusted fixed currency sales

● Adjusted cost of sales

● Adjusted gross margin

● Fixed currency operating income

● Fixed currency operating income margin

● Adjusted operating income

● Adjusted operating income margin

● Adjusted fixed currency operating income

● Adjusted fixed currency operating income margin

● Organic operating income, formerly known as acquisition adjusted fixed currency operating income

● Organic operating income margin, formerly known as acquisition adjusted fixed currency operating income margin

● EBITDA

● Adjusted tax rate

● Adjusted net income attributable to Ecolab

● Adjusted diluted EPS

We provide these measures as additional information regarding our operating results. We use these non-GAAP measures internally to evaluate our performance and in making financial and operational decisions, including with respect to incentive compensation. We believe that our presentation of these measures provides investors with greater transparency with respect to our results of operations and that these measures are useful for period-to-period comparison of results. 

Our non-GAAP financial measures for adjusted cost of sales, adjusted gross margin and adjusted operating income exclude the impact of special (gains) and charges and our non-GAAP financial measures for adjusted tax rate, adjusted net income attributable to Ecolab and adjusted diluted earnings per share further exclude the impact of discrete tax items. We include items within special (gains) and charges and discrete tax items that we believe can significantly affect the period-over-period assessment of operating results and not necessarily reflect costs and/or income associated with historical trends and future results. After tax special (gains) and charges are derived by applying the applicable local jurisdictional tax rate to the corresponding pre-tax special (gains) and charges.

EBITDA is defined as the sum of net income including noncontrolling interest, provision for income taxes, net interest expense, depreciation and amortization. EBITDA is used in our net debt to EBITDA ratio, which we view as important indicators of the operational and financial health of our organization.

We evaluate the performance of our international operations based on fixed currency rates of foreign exchange. Fixed currency amounts included in this Form 10-Q are based on translation into U.S. dollars at the fixed foreign currency exchange rates established by management at the beginning of 2023. We also provide our segment results based on public currency rates for informational purposes.

Our reportable segments do not include the impact of intangible asset amortization from the Nalco and Purolite transactions or the impact of special (gains) and charges as these are not allocated to our reportable segments.

Our non-GAAP financial measures for organic sales, organic operating income and organic operating income margin are at fixed currency and exclude the impact of special (gains) and charges, the results of our acquired businesses from the first twelve months post acquisition and the results of divested businesses from the twelve months prior to divestiture. As part of the separation of ChampionX in 2020, we entered into a Master Cross Supply and Product Transfer agreement with ChampionX to provide, receive or transfer certain products for a period up to 36 months and for a small set of products with limited suppliers over the next few years. Sales of product to

43

ChampionX under this agreement are recorded in product and equipment sales in the Corporate segment along with the related cost of sales. These transactions are removed from the consolidated results as part of the calculation of the impact of acquisitions and divestitures.

These non-GAAP measures are not in accordance with, or an alternative to U.S. GAAP, and may be different from non-GAAP measures used by other companies. Investors should not rely on any single financial measure when evaluating our business. We recommend that investors view these measures in conjunction with the U.S. GAAP measures included in this MD&A and we have provided reconciliations of reported U.S. GAAP amounts to the non-GAAP amounts.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 2, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include our business performance and prospects; expectations concerning timing, amount and type of restructuring costs and savings from restructuring activities; macroeconomic environment, delivered product cost inflation, currency translation, and interest rates; Russian operations; working capital; capital investments, acquisitions and share repurchases; amortization expense; non-performance of financial counterparties; payments and contributions to pension and postretirement health care benefit plans; the impact of lawsuits, claims and environmental matters; impact of new accounting pronouncements and tax laws; cash flows, borrowing capacity and funding of cash requirements; payments related to uncertain tax positions; and implementation of ERP system upgrade.

Without limiting the foregoing, words or phrases such as “will likely result,” “are expected to,” “will continue,” “is anticipated,” “we believe,” “we expect,” “estimate,” “project” (including the negative or variations thereof) or similar terminology, generally identify forward-looking statements. Forward-looking statements may also represent challenging goals for us. These statements, which represent our expectations or beliefs concerning various future events, are based on current expectations that involve a number of risks and uncertainties that could cause actual results to differ materially from those of such forward-looking statements. In particular, the ultimate results of any restructuring or efficiency initiative, integration and business improvement actions, including cost synergies, depend on a number of factors, including the development of final plans, the impact of local regulatory requirements regarding employee terminations, the time necessary to develop and implement the restructuring or efficiency initiative and other business improvement initiatives and the level of success achieved through such actions in improving competitiveness, efficiency and effectiveness. We caution that undue reliance should not be placed on such forward-looking statements, which speak only as of the date made.

Some of the factors which could cause results to differ materially from those expressed in any forward-looking statements are set forth under Item 1A of our most recent Form 10-K and our other public filings with the Securities and Exchange Commission (the "SEC"), and include the impact of economic factors such as the worldwide economy, capital flows, interest rates, foreign currency risk, reduced sales and earnings in our international operations resulting from the weakening of local currencies versus the U.S. dollar, demand uncertainty, supply chain challenges and inflation; the vitality of the markets we serve; exposure to global economic, political and legal risks related to our international operations, including geopolitical instability, the impact of sanctions or other actions taken by the U.S. or other countries, and retaliatory measures taken by Russia in response, in connection with the conflict in Ukraine; difficulty in procuring raw materials or fluctuations in raw material costs; our ability to attract, retain and develop high caliber management talent to lead our business and successfully execute organizational change and changing labor market dynamics; information technology infrastructure failures or breaches in data security; the effects and duration of the COVID-19 pandemic or other public health outbreaks, epidemics or pandemics; our ability to acquire complementary businesses and to effectively integrate such businesses, including Purolite; our ability to execute key business initiatives, including restructurings and our Enterprise Resource Planning system upgrades; our ability to successfully compete with respect to value, innovation and customer support; pressure on operations from consolidation of customers or vendors; restraints on pricing flexibility due to contractual obligations and our ability to meet our contractual commitments; the costs and effects of complying with laws and regulations, including those relating to the environment, climate change standards, and to the manufacture, storage, distribution, sale and use of our products, as well as to the conduct of our business generally, including labor and employment and anti-corruption; potential chemical spill or release; our commitments, goals, targets, objectives and initiatives related to sustainability; potential to incur significant tax liabilities or indemnification liabilities relating to the separation and split-off of our ChampionX business; the occurrence of litigation or claims, including class action lawsuits; the loss or insolvency of a major customer or distributor; repeated or prolonged government and/or business shutdowns or similar events; acts of war or terrorism; natural or man-made disasters; water shortages; severe weather conditions; changes in tax laws and unanticipated tax liabilities; potential loss of deferred tax assets; our indebtedness, and any failure to comply with covenants that apply to our indebtedness; potential losses arising from the impairment of goodwill or other assets; and other uncertainties or risks reported from time to time in our reports to the SEC. There can be no assurances that our earnings levels will meet investors’ expectations. Except as may be required under applicable law, we do not undertake, and expressly disclaim, any duty to update our Forward-Looking Statements.

44

Item 3. Quantitative and Qualitative Disclosures about Market Risk

We use foreign currency forward contracts, interest rate swap agreements and foreign currency debt to manage risks associated with foreign currency exchange rates, interest rates and net investments in our foreign operations. We do not hold derivative financial instruments of a speculative nature or for trading purposes. For a more detailed discussion of derivative instruments, refer to Note 8, entitled “Derivatives and Hedging Transactions”, of the consolidated financial statements located under Part I, Item 1 of this quarterly report on Form 10-Q.

Item 4. Controls and Procedures

As of June 30, 2023, we carried out an evaluation, under the supervision and with the participation of our management, including our Chairman and Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based upon that evaluation, our Chairman and Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures are effective.

During the period April 1, 2023 through June 30, 2023 there were no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

We are continuing our implementation of our enterprise resource planning (“ERP”) system upgrades, which are expected to occur in phases over the next several years. These upgrades, which include supply chain and certain finance functions, are expected to improve the efficiency of certain financial and related transactional processes. These upgrades of the ERP systems will affect the processes that constitute our internal control over financial reporting and will require testing for effectiveness.

45

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

Note 16, entitled “Commitments and Contingencies” located under Part I, Item 1 of this Form 10-Q is incorporated herein by reference.

Item 1A. Risk Factors

In our report on Form 10-K for the year ended December 31, 2022, filed with the Securities and Exchange Commission on February 24, 2023, we identify under Item 1A important factors which could affect our financial performance and could cause our actual results for future periods to differ materially from our anticipated results or other expectations, including those expressed in any forward-looking statements made in this Form 10-Q. See the section entitled Forward-Looking Statements located on page 44 of this Form 10-Q. We may also refer to such disclosure to identify factors that may cause results to differ from those expressed in other forward-looking statements made in oral presentations, including telephone conferences and/or webcasts open to the public.

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

						Number of shares		Maximum number of
	Total					purchased as part		shares that may
	number of		Average price			of publicly		yet be purchased
	shares		paid per			announced plans		under the plans
Period	purchased	(1)​	share		(2)​	or programs	(3)​	or programs	(3)​
April 1-30, 2023	-		$	-		-		12,917,097
May 1-31, 2023	1,428			173.6932		-		12,917,097
June 1-30, 2023	422			178.5523		-		12,917,097
Total	1,850		$	174.8016		-		12,917,097

(1) Includes 1,850 shares reacquired from employees and/or directors as swaps for the cost of stock options, or shares surrendered to satisfy minimum statutory tax obligations under our stock incentive plans.

(2) The average price paid per share includes brokerage commissions associated with publicly announced plan purchases plus the value of such other reacquired shares.

(3) As announced on February 24, 2015, our Board of Directors authorized the repurchase of up to 20,000,000 common shares. As announced on November 3, 2022, our Board of Directors authorized the repurchase of up to an additional 10,000,000 shares. Subject to market conditions, we expect to repurchase all shares under these authorizations, for which no expiration date has been established, in open market or privately negotiated transactions, including pursuant to Rule 10b5-1 and accelerated share repurchase program.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Rule 10b5-1 Plan Adoptions and Modifications

None.

46

Item 6. Exhibits

Exhibit No.	Document	Method of Filing
(a)	The following documents are filed as exhibits to this report:
(3.2)	By-Laws, as amended through May 4, 2023.	Incorporated by reference to Exhibit (3.1) of our Form 8-K, dated May 4, 2023. (File No. 001-9328)
(10.1)	Ecolab Inc. 2023 Stock Incentive Plan, effective May 4, 2023.	Filed herewith electronically.
(10.2)	Sample form of non-statutory stock option agreement for executive officers under the Ecolab Inc. 2023 Stock Incentive Plan, effective May 4, 2023.	Filed herewith electronically.
(10.3)	Sample form of performance-based restricted stock unit award agreement for executive officers under the Ecolab Inc. 2023 Stock Incentive Plan, effective May 4, 2023.	Filed herewith electronically.
(10.4)	Sample form of restricted stock unit agreement for executive officers under the Ecolab Inc. 2023 Stock Incentive Plan, effective May 4, 2023.	Filed herewith electronically.
(15.1)	Letter regarding unaudited interim financial information.	Filed herewith electronically.
(31.1)	Rule 13a - 14(a) CEO Certification.	Filed herewith electronically.
(31.2)	Rule 13a - 14(a) CFO Certification.	Filed herewith electronically.
(32.1)	Section 1350 CEO and CFO Certifications.	Filed herewith electronically.
(101.INS)	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.	Filed herewith electronically.
(101.SCH)	Inline XBRL Taxonomy Extension Schema.	Filed herewith electronically.
(101.CAL)	Inline XBRL Taxonomy Extension Calculation Linkbase.	Filed herewith electronically.
(101.DEF)	Inline XBRL Taxonomy Extension Definition Linkbase.	Filed herewith electronically.
(101.LAB)	Inline XBRL Taxonomy Extension Label Linkbase.	Filed herewith electronically.
(101.PRE)	Inline XBRL Taxonomy Extension Presentation Linkbase.	Filed herewith electronically.
(104)	Cover Page Interactive Data File.	Formatted as Inline XBRL and contained in Exhibit 101.

47

SIGNATURE

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.

	ECOLAB INC.
Date: August 3, 2023	By:	/s/ Jennifer J. Bradway
		Jennifer J. Bradway
		Senior Vice President and Corporate Controller
		(duly authorized officer and
		Chief Accounting Officer)

48

EX-10.1

Exhibit (10.1)

ECOLAB INC.

2023 STOCK INCENTIVE PLAN

(Effective May 4, 2023)

1.Purpose of Plan.

The purpose of the Ecolab Inc. 2023 Stock Incentive Plan (the “Plan”) is to advance the interests of Ecolab Inc. (the “Company”) and its stockholders by enabling the Company and its Subsidiaries to attract and retain qualified individuals through opportunities for equity participation in the Company, and to reward those individuals who contribute to the achievement of the Company's economic objectives.

2.Definitions.

The following terms will have the meanings set forth below, unless the context clearly otherwise requires:

2.1“Board” means the Board of Directors of the Company.

2.2“Broker Exercise Notice” means a written or electronic notice pursuant to which a Participant, upon exercise of an Option, irrevocably instructs a broker or dealer to sell a sufficient number of shares or loan a sufficient amount of money to pay all or a portion of the exercise price of the Option and/or any related withholding tax obligations and remit such sums to the Company and directs the Company to deliver stock certificates to be issued upon such exercise directly to such broker or dealer or their nominee.

2.3“Cause” means, unless otherwise set forth in an agreement between the Company and the Participant, (i) dishonesty, fraud, misrepresentation, embezzlement or deliberate injury or attempted injury, in each case related to the Company or any Subsidiary, (ii) any unlawful or criminal activity of a serious nature, (iii) any intentional and deliberate breach of a duty or duties that, individually or in the aggregate, are material in relation to the Participant’s overall duties, (iv) any material breach of any confidentiality or noncompete agreement entered into with the Company or any Subsidiary, or (v) substantial failure to perform duties after notice to the Participant and reasonable opportunity to cure.  

2.4“Change in Control” means an event described in Section 14.1 of the Plan; provided, however, if an Incentive Award constitutes a deferral of compensation subject to Section 409A of the Code, and if that Incentive Award provides for a change in the time or form of payment upon a Change in Control, then no Change in Control shall be deemed to have occurred upon an event described in Section 14.1 of the Plan unless the event would also constitute, under Section 409A of the Code and the regulations and rulings issued thereunder, either a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company.

2.5“Code” means the Internal Revenue Code of 1986, as amended.  

2.6“Committee” means the group of individuals administering the Plan, as provided in Section 3 of the Plan.

2.7“Common Stock” means the common stock of the Company, par value $1.00 per share, or the number and kind of shares of stock or other securities into which such Common Stock may be changed in accordance with Section 4.3 of the Plan.

2.8“Disability” means the disability of the Participant such as would entitle the Participant to receive disability income benefits pursuant to the long-term disability plan of the Company or Subsidiary then covering the Participant or, if no such plan exists or is applicable to the Participant, the permanent and total disability of the Participant in the sense that he or she is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months; provided, however, if distribution of an Incentive Award subject to Section 409A of the Code is or can be triggered by an Eligible Recipient’s Disability, such term will mean that the Eligible Recipient is disabled as defined by Section 409A of the Code and the regulations and rulings issued thereunder.

2.9“Director Plan” means the Ecolab Inc. 2001 Non-Employee Director Stock Option and Deferred Compensation Plan.

2.10“Eligible Recipients” means all employees (including, without limitation, officers and directors who are also employees) of the Company or any Subsidiary, all Non-Employee Directors and any consultants, advisors and independent contractors of the Company or any Subsidiary.

2.11“Exchange Act” means the Securities Exchange Act of 1934, as amended.

2.12“Fair Market Value” means, with respect to the Common Stock, as of any date (or, if no shares were traded or quoted on such date, as of the next preceding date on which there was such a trade or quote) as of any date, shall mean the fair market value as of the relevant date of determination, as determined in accordance with a valuation methodology approved by the Committee in good faith and in accordance with Code Section 409A and other laws to the extent applicable; provided however, that if the Committee has not specified otherwise, Fair Market Value with respect to Common Stock, as of any date, shall mean the arithmetic mean between the reported high and low sale prices of the Common Stock during the regular daily trading session, as reported on the New York Stock Exchange.

2.13“Good Reason” means, unless otherwise set forth in an agreement between the Company and the Participant, without the express written consent of the affected Participant, any of the following events involving the Company or Subsidiary that employs or receives services from the Participant:

(a)any failure by the Company or applicable Subsidiary to furnish the Participant with compensation and benefits at a level substantially equal to or exceeding those received by the Participant from the Company or applicable Subsidiary during the 90-day period preceding the Change in Control, other than (i) an insubstantial and inadvertent failure remedied by the Company or applicable Subsidiary as set forth below, (ii) a reduction in compensation which is applied to all non-union employees of the Company or applicable Subsidiary in the same dollar amount or percentage, or (iii) a

2

reduction or modification of any employee benefit program covering substantially all of the employees of the Company or applicable Subsidiary, which reduction or modification generally applies to all employees covered under such program; or

(b)the Company or applicable Subsidiary requiring the Participant to be based or to perform services at any office or location that is in excess of 50 miles from the principal location of the Participant’s work during the 90-day period immediately preceding the Change in Control, except for travel reasonably required in the performance of the Participant’s responsibilities.

Before a termination by the Participant under this Section 2.13 will constitute termination for Good Reason, the Participant must give the Company a notice of termination within 30 calendar days of the occurrence of the event that constitutes Good Reason.  The notice must set forth in reasonable detail the specific reason for the termination and the facts and circumstances claimed to provide a basis for termination of employment under the provision indicated.  Failure to provide such notice within such 30-day period shall be conclusive proof that the Participant does not have Good Reason to terminate employment.

For purposes of this Section 2.13, Good Reason shall exist only if the Company or applicable Subsidiary fails to remedy the event or events constituting Good Reason within 30 calendar days after receipt of the notice of termination from the Participant.  If the Participant determines Good Reason for termination exists and timely files a notice of termination, such determination shall be presumed to be true and the Company will have the burden of proving that Good Reason does not exist.  

2.14“Incentive Award” means an Option, Stock Appreciation Right, Restricted Stock Award, Stock Unit Award or Performance Award granted to an Eligible Recipient pursuant to the Plan.

2.15“Incentive Stock Option” means a right to purchase Common Stock granted to an Eligible Recipient pursuant to Section 6 of the Plan that qualifies as an “incentive stock option” within the meaning of Section 422 of the Code.

2.16“Non-Employee Director” means a member of the Board who is not an employee of the Company or any Subsidiary.

2.17“Non-Statutory Stock Option” means a right to purchase Common Stock granted to an Eligible Recipient pursuant to Section 6 of the Plan that does not qualify as an Incentive Stock Option.

2.18“Option” means an Incentive Stock Option or a Non-Statutory Stock Option.  

2.19“Participant” means an Eligible Recipient who receives one or more Incentive Awards under the Plan.

2.20“Performance Award” means a right granted to an Eligible Recipient pursuant to Section 10 of the Plan to receive an amount of cash, shares of Common Stock, or a combination

3

of both, contingent upon achievement of Performance Criteria or other objectives during a specified period.

2.21“Performance Criteria” means the performance criteria that are used by the Committee in granting Incentive Awards contingent upon achievement of performance goals over a specified performance period.  The Performance Criteria may consist of one or a combination of two or more of the following: net sales; operating income; net income; net income per share (basic or diluted); earnings before or after any one or more of taxes, interest, depreciation and amortization; profitability as measured by return ratios (including return on invested capital, return on assets, return on equity, return on investment and return on sales); cash flow; market share; cost reduction goals; margins (including one or more of gross, operating and net income margins); stock price; total return to stockholders; economic value added; working capital and strategic plan development and implementation; and any other metric as may be determined by the Committee.  The Committee may select one criterion or multiple criteria for measuring performance, and the measurement may be based upon Company, Subsidiary or business unit performance, and may be expressed in absolute amounts, on a per share basis, as a growth rate or change from preceding periods, or by relative comparison to the performance of other companies or any other external measure of the selected criteria.  The Committee shall, in its sole discretion, define in an objective fashion the manner of calculating the performance goals based on the Performance Criteria it selects to use in any performance period, which may include adjustments to such criteria as otherwise defined under U.S. Generally Accepted Accounting Principles or other adjustments or exclusions as the Committee determines.  Subsequent references in this Plan to the achievement or satisfaction of Performance Criteria shall be deemed to include performance goals specified by the Committee that are based on such Performance Criteria.

2.22“Previously Acquired Shares” means shares of Common Stock that are already owned by the Participant.

2.23“Prior Plan” means the Ecolab Inc. 2010 Stock Incentive Plan.

2.24“Restricted Stock Award” means an award of Common Stock granted to an Eligible Recipient pursuant to Section 8 of the Plan that is subject to restrictions on transferability and a risk of forfeiture.

2.25“Retirement” means, unless otherwise set forth in an agreement between the Company and the Participant, termination of employment or service at or after age fifty-five (55) with five (5) or more years of continuous employment or other service with the Company and any Subsidiaries.  

2.26“Securities Act” means the Securities Act of 1933, as amended.

2.27“Stock Appreciation Right” means a right granted to an Eligible Recipient pursuant to Section 7 of the Plan to receive a payment from the Company, in the form of shares of Common Stock, cash or a combination of both, equal to the difference between the Fair Market Value of one or more shares of Common Stock and a specified exercise price of such shares.

2.28“Stock Unit Award” means a right granted to an Eligible Recipient pursuant to Section 9 of the Plan to receive the Fair Market Value of one or more shares of Common Stock,

4

payable in cash, shares of Common Stock, or a combination of both, the payment, issuance, retention and /or vesting of which is subject to the satisfaction of specified conditions, which may include achievement of Performance Criteria or other objectives.

2.29“Subsidiary” means any entity that is a “subsidiary corporation,” as defined in Code Section 424(f), of the Company or any entity in which the Company owns, directly or indirectly, at least 20% of combined voting power of the entity’s voting securities and which is designated by the Committee as covered by the Plan.

2.30“Substitute Award” means an Incentive Award granted upon the assumption of, or in substitution or exchange for, outstanding awards granted by a company or other entity acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines.

2.31“Tax Date” means the date any withholding tax obligation arises under the Code for a Participant with respect to an Incentive Award.  

3.Plan Administration.

3.1The Committee.  The Plan will be administered by the Board or by a committee of the Board.  So long as the Company has a class of its equity securities registered under Section 12 of the Exchange Act, any committee administering the Plan will consist solely of two or more members of the Board who are “non-employee directors” within the meaning of Rule 16b-3 under the Exchange Act and who are “independent” as required by the listing standards of the New York Stock Exchange, but any action taken by such a committee shall be valid and effective even if the members of such committee at the time of such action are later determined not to have satisfied all the requirements for membership specified above.  Such a committee, if established, will act by majority approval of the members (unanimous approval with respect to action by written consent), and a majority of the members of such a committee will constitute a quorum.  As used in the Plan, “Committee” will refer to the Board or to such a committee, if established.  To the extent consistent with applicable corporate law of the Company’s jurisdiction of incorporation, the Committee may delegate to one or more of its members, to any other member of the Board or to any officers of the Company the duties, power and authority of the Committee under the Plan pursuant to such conditions or limitations as the Committee may establish; provided, however, that only the Committee may exercise such duties, power and authority with respect to Eligible Recipients who are subject to Section 16 of the Exchange Act.  The Committee may also delegate to one or more agents or advisors such non-discretionary administrative duties or powers as it deems advisable.  The Committee may exercise its duties, power and authority under the Plan in its sole and absolute discretion without the consent of any Participant or other party, unless the Plan specifically provides otherwise.  Each determination, interpretation or other action made or taken by the Committee pursuant to the provisions of the Plan will be conclusive and binding for all purposes and on all persons, and no member of the Committee will be liable for any action or determination made in good faith with respect to the Plan or any Incentive Award granted under the Plan.

3.2Authority of the Committee.

(a)In accordance with and subject to the provisions of the Plan, the Committee will have the authority to determine all provisions of Incentive Awards as the Committee

5

may deem necessary or desirable and as consistent with the terms of the Plan, including, without limitation, the following:  (i) the Eligible Recipients to be selected as Participants; (ii) the nature and extent of the Incentive Awards to be made to each Participant (including the number of shares of Common Stock to be subject to each Incentive Award, any exercise price, the manner in which Incentive Awards will vest or become exercisable and whether Incentive Awards will be granted in tandem with other Incentive Awards) and the form of written or electronic agreement, if any, evidencing such Incentive Award; (iii) the time or times when Incentive Awards will be granted; (iv) the duration of each Incentive Award; and (v) the restrictions and other conditions to which the payment or vesting of Incentive Awards may be subject.  In addition, the Committee will have the authority under the Plan in its sole discretion to (A) establish, amend or rescind rules to administer the Plan; (B) interpret the Plan and any Incentive Award or related agreement made under the Plan; (C) make all other determinations necessary or desirable for the administration of the Plan; and (D) pay the intrinsic value of any Incentive Award in the form of cash, Common Stock or any combination of both.

(b)Subject to Section 3.2(d) below, the Committee will have the authority under the Plan to amend or modify the terms of any outstanding Incentive Award in any manner, including, without limitation, the authority to modify the number of shares or other terms and conditions of an Incentive Award, extend the term of an Incentive Award, accelerate the exercisability or vesting or otherwise terminate any restrictions relating to an Incentive Award, accept the surrender of any outstanding Incentive Award or, to the extent not previously exercised or vested, authorize the grant of new Incentive Awards in substitution for surrendered Incentive Awards; provided, however that (i) the amended or modified terms are permitted by the Plan as then in effect; and (ii) any Participant adversely affected by such amended or modified terms shall have consented to such amendment or modification unless such amendment is necessary to comply with applicable law or stock exchange rules.

(c)In the event of (i) any reorganization, merger, consolidation, recapitalization, liquidation, reclassification, stock dividend, stock split, combination of shares, rights offering, extraordinary dividend or divestiture (including a spin-off) or any other change in corporate structure or shares; (ii) any purchase, acquisition, sale, disposition or write-down of a significant amount of assets or a significant business; (iii) any change in accounting principles or practices, tax laws or other such laws or provisions affecting reported results; (iv) any uninsured catastrophic losses or other material, infrequent items outside the normal course of business or in management’s discussion and analysis of financial performance appearing in the Company’s annual report to stockholders for the applicable year; or (v) any other similar change, in each case with respect to the Company or any other entity whose performance is relevant to the grant or vesting of an Incentive Award, the Committee (or, if the Company is not the surviving corporation in any such transaction, the board of directors of the surviving corporation) may, without the consent of any affected Participant, amend or modify the vesting criteria (including Performance Criteria and related performance goals) of any outstanding Incentive Award that is based in whole or in part on the financial performance of the Company (or any Subsidiary or division or other subunit thereof) or such other entity so as equitably to reflect such event, with the desired result that the criteria for evaluating such

6

financial performance of the Company or such other entity will be substantially the same (in the sole discretion of the Committee or the board of directors of the surviving corporation) following such event as prior to such event; provided, however, that the amended or modified terms are permitted by the Plan as then in effect.

(d)Notwithstanding any other provision of this Plan other than Section 4.3 (and with respect to subsections 3.2(d)(ii) and 3.2(d)(iii), other than in connection with a Change in Control), the Committee may not, without prior approval of the Company’s stockholders, seek to effect any re-pricing of any previously granted, “underwater” Option or Stock Appreciation Right by:  (i) amending or modifying the terms of the Option or Stock Appreciation Right to lower the exercise price; (ii) canceling the underwater Option or Stock Appreciation Right and granting either (A) replacement Options or Stock Appreciation Rights having a lower exercise price; (B) Restricted Stock Awards; or (C) Stock Unit Awards or Performance Awards in exchange; or (iii) repurchasing the underwater Options or Stock Appreciation Rights for cash.  For purposes of this Section 3.2(d), an Option or Stock Appreciation Right will be deemed to be “underwater” at any time when the Fair Market Value of the Common Stock is less than the exercise price of the Option or the Stock Appreciation Right.

(e)In addition to the authority of the Committee under Section 3.2(b) and notwithstanding any other provision of the Plan, the Committee may, in its sole discretion, amend the terms of the Plan or Incentive Awards with respect to Participants resident outside of the United States or employed by a non-U.S. Subsidiary in order to comply with local legal requirements, to otherwise protect the Company’s or Subsidiary’s interests, or to meet objectives of the Plan, and may, where appropriate, establish one or more sub-plans (including the adoption of any required rules and regulations) for the purposes of qualifying for preferred tax treatment under foreign tax laws.  The Committee shall have no authority, however, to take action pursuant to this Section 3.2(e): (i) to reserve shares or grant Incentive Awards in excess of the limitations provided in Section 4.1; (ii) to effect any re-pricing in violation of Section 3.2(d); (iii) to grant Options having an exercise price less than 100% of the Fair Market Value of one share of Common Stock on the date of grant in violation of Section 6.2; or (iv) for which stockholder approval would then be required pursuant to Section 422 of the Code or the rules of the New York Stock Exchange.

(f)Notwithstanding anything in this Plan to the contrary, the Committee will determine whether an Incentive Award is subject to the requirements of Section 409A of the Code and, if determined to be subject to Section 409A of the Code, the Committee will make such Incentive Award subject to such written terms and conditions determined necessary or desirable to cause such Incentive Award to comply in form with the requirements of Section 409A of the Code.  Further, the Plan, as it relates to Incentive Awards that are subject to Section 409A of the Code, will be administered in a manner that is intended to comply with the requirements of Section 409A of the Code and any regulations or rulings issued thereunder.

7

4.Shares Available for Issuance.

4.1Maximum Number of Shares Available; Certain Restrictions on Awards.  Subject to adjustment in Sections 4.2 and 4.3 of the Plan, the maximum number of shares of Common Stock that will be available for issuance under the Plan will be 20,000,000, less one (1) share of Common Stock for every one (1) share that was subject to an option or stock appreciation right granted after December 31, 2022 and prior to the effective date of the Plan under the  Prior Plan and 2.5 shares of Common Stock for every one (1) share that was subject to an award other than an option or stock appreciation right granted after December 31, 2022 and prior to the effective date of the Plan under the Prior Plan.  Any shares of Common Stock that are subject to Options or Stock Appreciation Rights shall be counted against this limit as one (1) share for every one (1) share granted, and any shares that are subject to Incentive Awards other than Options or Stock Appreciation Rights shall be counted against this limit as 2.5 shares for every one (1) share granted.    After the effective date of the Plan, no awards may be granted under the Prior Plan.  The shares available for issuance under the Plan may, at the election of the Committee, be either treasury shares or shares authorized but unissued, and, if treasury shares are used, all references in the Plan to the issuance of shares will, for corporate law purposes, be deemed to mean the transfer of shares from treasury.  No more than 20,000,000 shares of Common Stock may be issued subject to Incentive Stock Options.

4.2Accounting for Incentive Awards.  Any shares of Common Stock subject to an Incentive Award, or as of December 31, 2022, an award granted under the Prior Plan that is outstanding (a “Prior Plan Award”), that lapses, expires, is forfeited (including issued shares forfeited under a Restricted Stock Award) or for any reason is terminated unexercised or unvested or is settled or paid in cash or any form other than shares of Common Stock shall, to the extent of such lapse, expiration, forfeiture or settlement other than in shares of Common Stock, automatically again become available for issuance under the Plan and correspondingly increase the total number of shares available for issuance under Section 4.1.  Similarly, any shares of Common Stock that are withheld by the Company, or any Previously Acquired Shares that are tendered (either actually or by attestation) by a Participant, in either case to satisfy any tax withholding obligation with respect to an Incentive Award other than an Option or Stock Appreciation Right or a Prior Plan Award other than a stock option or stock appreciation right shall automatically again become available for issuance under the Plan and correspondingly increase the total number of shares available for issuance under Section 4.1.  Notwithstanding anything to the contrary in this Section 4.2, the following shares of Common Stock will not again become available for issuance under the Plan: (i) any shares which would have been issued upon any exercise of an Option (or option granted under the Prior Plan) but for the fact that the Option exercise price was paid by a “net exercise” pursuant to Section 6.4(b) or by Previously Acquired Shares tendered (either actually or by attestation) by a Participant; (ii) any shares that are withheld by the Company, or any Previously Acquired Shares that are tendered (either actually or by attestation) by a Participant, in either case to satisfy any tax withholding obligation with respect to an Option or Stock Appreciation Right or a Prior Plan stock option or stock appreciation right; (iii) shares covered by a stock appreciation right issued under the Plan or the Prior Plan that are not issued in connection with the stock settlement of the stock appreciation right upon its exercise; or (iv) shares that are repurchased by the Company using Option exercise proceeds.  Any shares of Common Stock that again become available for Incentive Awards under the Plan pursuant to this Section shall be added as (i) one (1) share for every one (1) share subject to Options or Stock

8

Appreciation Rights granted under the Plan or options or stock appreciation rights granted under the Prior Plan, and (ii) as 2.5 shares for every one (1) share subject to Incentive Awards other than Options or Stock Appreciation Rights granted under the Plan or awards other than options or stock appreciation rights granted under the Prior Plan.  Substitute Awards shall not reduce the shares authorized for grant under the, nor shall shares subject to a Substitute Award be added to the shares available for Incentive Awards under the Plan as provided in this Section 4.2.

4.3Adjustments to Shares and Incentive Awards.  In the event of any equity restructuring (within the meaning of FASB ASC Topic 718, Compensation - Stock Compensation) that causes the per share value of shares of Common Stock to change, such as a stock dividend, stock split, spinoff, rights offering or recapitalization through an extraordinary dividend, the Committee shall make such adjustments as it deems equitable and appropriate to (i) the aggregate number and kind of shares or other securities issued or reserved for issuance under the Plan, (ii) the number and kind of shares or other securities subject to outstanding Incentive Awards, and (iii) the exercise price of outstanding Options and Stock Appreciation Rights.  In the event of any other change in corporate capitalization, including a merger, consolidation, reorganization, or partial or complete liquidation of the Company, such equitable adjustments described in the foregoing sentence may be made as determined to be appropriate and equitable by the Committee (or, if the Company is not the surviving corporation in any such transaction, the board of directors of the surviving corporation) to prevent dilution or enlargement of rights of Participants.  In either case, any such adjustment shall be conclusive and binding for all purposes of the Plan.  No adjustment shall be made pursuant to this Section 4.3 in connection with the conversion of any convertible securities of the Company, or in a manner that would cause Incentive Stock Options to violate Section 422(b) of the Code or cause an Incentive Award to be subject to adverse tax consequences under Section 409A of the Code.

4.4Effect of Plans Maintained by Acquired Companies.  If a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines has shares available under a pre-existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as adjusted, to the extent appropriate, using the exchange ratio or other adjustment or valuation ratio or formula used in such acquisition or combination to determine the consideration payable to the holders of common stock of the entities party to such acquisition or combination) may be used for Incentive Awards under the Plan and shall not reduce the shares of Common Stock authorized for issuance under the Plan.  Incentive Awards using such available shares shall not be made after the date awards could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not employees of the Company or any Subsidiary or Non-Employee Directors prior to such acquisition or combination.

4.5Non-Employee Director Limit. Notwithstanding anything herein to the contrary, the sum of (A) the aggregate grant date fair value (computed as of the date of grant in accordance with applicable financial accounting rules) of all Incentive Awards granted to any Non-Employee Director during any single calendar year, (B) the aggregate grant date fair value (computed as of the date of grant in accordance with applicable financial accounting rules) of all awards granted to such director under the Director Plan during such calendar year, and (C) the total cash compensation paid to such director for services rendered for such calendar year, shall

9

not exceed $900,000 provided, however, that the limitation described in this Section shall be determined without regard to amounts paid to a Non-Employee Director during any period in which such individual was an employee or consultant (other than grants of awards paid for service in their capacity as a Non-Employee Director). For the avoidance of doubt, any compensation that is deferred shall be counted toward this limit for the year in which it was first earned, and not when paid or settled if later.

5.Participation.

Participants in the Plan will be those Eligible Recipients who, in the judgment of the Committee, have contributed, are contributing or are expected to contribute to the achievement of economic objectives of the Company or its Subsidiaries.  Eligible Recipients may be granted from time to time one or more Incentive Awards, singly or in combination or in tandem with other Incentive Awards, as may be determined by the Committee in its sole discretion.  Incentive Awards will be deemed to be granted as of the date specified in the grant resolution of the Committee, which date will not be earlier than the date the Committee approved the grant resolution and will be indicated as the grant date of any related agreement with the Participant.

6.Options.

6.1Grant.  An Eligible Recipient may be granted one or more Options under the Plan, and such Options will be subject to such terms and conditions, consistent with the other provisions of the Plan, as may be determined by the Committee in its sole discretion.  The Committee may designate whether an Option is to be considered an Incentive Stock Option or a Non-Statutory Stock Option.  To the extent that any Incentive Stock Option granted under the Plan ceases for any reason to qualify as an “incentive stock option” for purposes of Section 422 of the Code, such Incentive Stock Option will continue to be outstanding for purposes of the Plan but will thereafter be deemed to be a Non-Statutory Stock Option.

6.2Exercise Price.  The per share price to be paid by a Participant upon exercise of an Option will be determined by the Committee in its discretion at the time of the Option grant, provided that such price will not be less than 100% of the Fair Market Value of one share of Common Stock on the date of grant, except in the case of Substitute Awards.

6.3Exercisability and Duration.  An Option will become exercisable at such times and in such installments and upon such terms and conditions as may be determined by the Committee in its sole discretion at the time of grant (including without limitation (i) the achievement of one or more of the Performance Criteria; and/or that (ii) the Participant remain in the continuous employ or service of the Company or a Subsidiary for a certain period; provided, however, that no Option may be exercisable after 10 years from its date of grant.

6.4Payment of Exercise Price.  

(a)The total purchase price of the shares to be purchased upon exercise of an Option will be paid entirely in cash (including check, bank draft or money order); provided, however, that the Committee, in its sole discretion and upon terms and conditions established by the Committee, may allow such payments to be made, in whole or in part, by (i) tender of a Broker Exercise Notice; (ii) by tender, or attestation as to ownership, of

10

Previously Acquired Shares that have been held for the period of time necessary to avoid a charge to the Company’s earnings for financial reporting purposes and that are otherwise acceptable to the Committee; (iii) by a “net exercise of the Option (as further described in paragraph (b), below); or (iv) by a combination of such methods.

(b)In the case of a “net exercise” of an Option, the Company will not require a payment of the exercise price of the Option from the Participant but will reduce the number of shares of Common Stock issued upon the exercise by the largest number of whole shares that has a Fair Market Value that does not exceed the aggregate exercise price for the shares exercised under this method. Shares of Common Stock will no longer be outstanding under an Option (and will therefore not thereafter be exercisable) following the exercise of such Option to the extent of (i) shares used to pay the exercise price of an Option under the “net exercise,” (ii) shares actually delivered to the Participant as a result of such exercise and (iii) any shares withheld for purposes of tax withholding pursuant to Section 13.1.

(c)Previously Acquired Shares tendered or covered by an attestation as payment of an Option exercise price will be valued at their Fair Market Value on the exercise date.

6.5Manner of Exercise. An Option may be exercised by a Participant in whole or in part from time to time, subject to the conditions contained in the Plan and in the agreement evidencing such Option, by giving written or electronic notice of exercise to the Company at its principal executive office in St. Paul, Minnesota or through the procedures established with any Company-appointed third-party administrator specifying the number of shares of Common Stock as to which the Option is being exercised and by paying in full the total exercise price for the shares of Common Stock to be purchased in accordance with Section 6.4 of the Plan.

7.Stock Appreciation Rights.

7.1Grant.  An Eligible Recipient may be granted one or more Stock Appreciation Rights under the Plan, and such Stock Appreciation Rights will be subject to such terms and conditions, consistent with the other provisions of the Plan, as may be determined by the Committee in its sole discretion.  The Committee will have the sole discretion to determine the form in which payment of the intrinsic value of Stock Appreciation Rights will be made to a Participant (i.e., cash, Common Stock or any combination thereof) or to consent to or disapprove the election by a Participant of the form of such payment.

7.2Exercise Price.  The exercise price of a Stock Appreciation Right will be determined by the Committee, in its discretion, at the date of grant but may not be less than 100% of the Fair Market Value of one share of Common Stock on the date of grant, except as provided in Section 7.4 below and except in the case of Substitute Awards.

7.3Exercisability and Duration.  A Stock Appreciation Right will become exercisable at such time and in such installments as may be determined by the Committee in its sole discretion at the time of grant; provided, however, that no Stock Appreciation Right may be exercisable after 10 years from its date of grant.  A Stock Appreciation Right will be exercised by giving notice in the same manner as for Options, as set forth in Section 6.5 of the Plan.

11

7.4Grants in Tandem with Options.  Stock Appreciation Rights may be granted alone or in addition to other Incentive Awards, or in tandem with an Option, either at the time of grant of the Option or at any time thereafter during the term of the Option.  A Stock Appreciation Right granted in tandem with an Option shall cover the same number of shares of Common Stock as covered by the Option (or such lesser number as the Committee may determine), shall be exercisable at such time or times and only to the extent that the related Option is exercisable, have the same term as the Option and shall have an exercise price equal to the exercise price for the Option.  Upon the exercise of a Stock Appreciation Right granted in tandem with an Option, the Option shall be canceled automatically to the extent of the number of shares covered by such exercise; conversely, upon exercise of an Option having a related Stock Appreciation Right, the Stock Appreciation Right shall be canceled automatically to the extent of the number of shares covered by the Option exercise.

8.Restricted Stock Awards.

8.1Grant.  An Eligible Recipient may be granted one or more Restricted Stock Awards under the Plan, and such Restricted Stock Awards will be subject to such terms and conditions, consistent with the other provisions of the Plan, as may be determined by the Committee in its sole discretion.  The Committee may impose such restrictions or conditions, not inconsistent with the provisions of the Plan, to the vesting of such Restricted Stock Awards as it deems appropriate, including, without limitation, (i) the achievement of one or more of the Performance Criteria; and/or that (ii) the Participant remain in the continuous employ or service of the Company or a Subsidiary for a certain period.  

8.2Rights as a Stockholder; Transferability.  Except as provided in Sections 8.1, 8.3, 8.4 and 15.3 of the Plan, a Participant will have all voting, dividend, liquidation and other rights with respect to shares of Common Stock issued to the Participant as a Restricted Stock Award under this Section 8 upon the Participant becoming the holder of record of such shares as if such Participant were a holder of record of shares of unrestricted Common Stock.

8.3Dividends and Distributions.  Any dividends or distributions paid or payable with respect to shares of Common Stock subject to the unvested portion of a Restricted Stock Award will be subject to the same restrictions and risks of forfeiture as the shares to which such dividends or distributions relate.  The Committee will determine in its sole discretion whether any interest will be payable on such restricted dividends or distributions.  

8.4Enforcement of Restrictions.  To enforce the restrictions referred to in this Section 8, the Committee may place a legend on the stock certificates referring to such restrictions and may require the Participant, until the restrictions have lapsed, to keep the stock certificates, together with duly endorsed stock powers, in the custody of the Company or its transfer agent, or to maintain evidence of stock ownership, together with duly endorsed stock powers, in a certificateless book-entry stock account with the Company’s transfer agent.

9.Stock Unit Awards.

An Eligible Recipient may be granted one or more Stock Unit Awards under the Plan, and such Stock Unit Awards will be subject to such terms and conditions, consistent with the other

12

provisions of the Plan, as may be determined by the Committee in its sole discretion.  The Committee may impose such restrictions or conditions, not inconsistent with the provisions of the Plan, to the payment, issuance, retention and/or vesting of such Stock Unit Awards as it deems appropriate, including, without limitation, (i) the achievement of one or more of the Performance Criteria; and/or that (ii) the Participant remain in the continuous employ or service of the Company or a Subsidiary for a certain period.  The agreement evidencing a Stock Unit Award shall either (i) provide that in all cases payment of the Stock Unit Award will be made within two and one-half months following the end of the Eligible Recipient’s tax year during which receipt of the Stock Unit Award is no longer subject to a “substantial risk of forfeiture” within the meaning of Section 409A of the Code, or (ii) contain terms and conditions necessary to avoid adverse tax consequences specified in Section 409A of the Code.  

10.Performance Awards.

An Eligible Recipient may be granted one or more Performance Awards under the Plan, and such Performance Awards will be subject to such terms and conditions, if any, consistent with the other provisions of the Plan, as may be determined by the Committee in its sole discretion, including, but not limited to, the achievement of one or more of the Performance Criteria.  The agreement evidencing a Performance Award shall either (i) provide that in all cases payment of the Performance Award will be made within two and one-half months following the end of the Eligible Recipient’s tax year during which receipt of the Performance Award is no longer subject to a “substantial risk of forfeiture” within the meaning of Section 409A of the Code, or (ii) contain terms and conditions necessary to avoid adverse tax consequences specified in Section 409A of the Code.  

11.[RESERVED].

12.Termination of Employment or Other Service.

The Committee shall determine and set forth in each award agreement whether (i) any Options or Stock Appreciation Rights granted in such award agreement will become or continue to become exercisable and/or remain exercisable and (ii) any Restricted Stock Awards, Stock Unit Awards or Performance Awards granted in such award agreement vest and/or continue to vest or become free of restrictions and conditions to payment, as the case may be, on and after the date that a Participant ceases to be employed by or to provide services to the Company or any Subsidiary (including as a Non-Employee Director), whether by reason of death, Disability, Retirement, voluntary or involuntary termination of employment or services, or otherwise.  The date of termination of a Participant’s employment or services will be determined in accordance with Section 12.3(c).

12.1Modification of Rights Upon Termination.  Notwithstanding the other provisions of this Plan, upon a Participant’s termination of employment or other service with the Company and all Subsidiaries, the Committee may, in its sole discretion (which may be exercised at any time on or after the date of grant, including following such termination), except as provided below, cause Options or Stock Appreciation Rights (or any part thereof) then held by such Participant to terminate, become or continue to become exercisable and/or remain exercisable following such termination of employment or service, and Restricted Stock Awards, Stock Unit Awards or

13

Performance Awards then held by such Participant to terminate, vest and/or continue to vest or become free of restrictions and conditions to payment, as the case may be, following such termination of employment or service, in each case in the manner determined by the Committee; provided, however, that any such action adversely affecting any outstanding Incentive Award will not be effective without the consent of the affected Participant (subject to the right of the Committee to take whatever action it deems appropriate under Sections 3.2(c), 4.3 and 14 of the Plan).  

12.2Effects of Actions Constituting Cause.  Notwithstanding anything in the Plan to the contrary, in the event that a Participant is determined by the Committee, acting in its sole discretion, to have committed any action which would constitute Cause as defined in Section 2.3, irrespective of whether such action or the Committee’s determination occurs before or after termination of such Participant’s employment with the Company or any Subsidiary, all rights of the Participant under the Plan and any agreements evidencing an Incentive Award then held by the Participant shall terminate and be forfeited without notice of any kind.  The Company may defer the exercise of any Option, the vesting of any Restricted Stock Award or the payment of any Stock Unit Award or Performance Award for a period of up to forty-five (45) days in order for the Committee to make any determination as to the existence of Cause.

12.3Determination of Termination of Employment or Other Service.  

(a)The change in a Participant's status from that of an employee of the Company or any Subsidiary to that of a non-employee consultant or advisor of the Company or any Subsidiary will, for purposes of the Plan, be deemed to result in a termination of such Participant's employment with the Company and its Subsidiaries, unless the Company otherwise determines in its sole discretion.

(b)The change in a Participant's status from that of a non-employee consultant or advisor of the Company or any Subsidiary to that of an employee of the Company or any Subsidiary will not, for purposes of the Plan, be deemed to result in a termination of such Participant's service as a non-employee consultant or advisor with the Company and its Subsidiaries, and such Participant will thereafter be deemed to be an employee of the Company or its Subsidiaries until such Participant's employment is terminated, in which event such Participant will be governed by the provisions of this Plan relating to termination of employment (subject to paragraph (a), above).

(c)Unless the Committee otherwise determines in its sole discretion, a Participant’s employment or other service will, for purposes of the Plan, be deemed to have terminated on the date recorded on the personnel or other records of the Company or the Subsidiary for which the Participant provides employment or other service, as determined by the Committee in its sole discretion based upon such records; provided, however, if distribution or payment of an Incentive Award subject to Section 409A of the Code is triggered by a termination of a Participant’s employment, such termination must also constitute a “separation from service” within the meaning of Section 409A of the Code.

14

13.Payment of Withholding Taxes.

13.1General Rules.  The Company is entitled to (a) withhold and deduct from future wages of the Participant (or from other amounts that may be due and owing to the Participant from the Company or a Subsidiary), or make other arrangements for the collection of, all legally required amounts necessary to satisfy any and all federal, foreign, state and local withholding and employment-related tax requirements attributable to an Incentive Award, including, without limitation, the grant, exercise or vesting of, or payment of dividends with respect to, an Incentive Award or a disqualifying disposition of stock received upon exercise of an Incentive Stock Option; (b) withhold cash paid or payable or shares of Common Stock from the shares issued or otherwise issuable to the Participant in connection with an Incentive Award; or (c) require the Participant promptly to remit the amount of such withholding to the Company before taking any action, including issuing any shares of Common Stock, with respect to an Incentive Award.  

13.2Special Rules. The Committee may, in its sole discretion and upon terms and conditions established by the Committee, permit or require a Participant to satisfy, in whole or in part, any withholding or employment-related tax obligation described in Section 13.1 of the Plan by electing to tender, or by attestation as to ownership of, Previously Acquired Shares that have been held for the period of time necessary to avoid a charge to the Company’s earnings for financial reporting purposes and that are otherwise acceptable to the Committee, by delivery of a Broker Exercise Notice or a combination of such methods. For purposes of satisfying a Participant’s withholding or employment-related tax obligation, Previously Acquired Shares tendered or covered by an attestation will be valued at their Fair Market Value.

14.Change in Control.

14.1A “Change in Control” shall be deemed to have occurred if the event set forth in any one of the following paragraphs shall have occurred (unless otherwise set forth in an award agreement or other agreement between the Company and Participant):  

(a)any "person" as such term is used in Sections 13(d) and 14(d) of the Exchange Act (other than  the Company, any trustee or other fiduciary holding securities under any employee benefit plan of the Company or any corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company), is or becomes, including pursuant to a tender or exchange offer for shares of Common Stock pursuant to which purchases are made, the "beneficial owner" (as defined in Rule l3d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 25% or more of the combined voting power of the Company's then outstanding securities, provided, however, that the provisions of this paragraph (a) shall not be applicable to a transaction in which a corporation becomes the owner of all the Company's outstanding securities in a transaction that would not be a Change of Control under paragraph (c) of this Section 14.1; or

(b)during any twenty-four (24) consecutive calendar months, individuals who constitute the Board on the first day of such period or any new director (other than a director whose initial assumption of office is in connection with an actual or threatened election contest including, but not limited to, a consent solicitation, relating to the election of

15

directors of the Company) whose appointment or election by the Board or nomination for election by the Company's stockholders was approved or recommended by a vote of at least two-thirds (2/3) of the directors then still in office who were either directors on the first day of such period, or whose appointment, election or nomination for election was previously so approved or recommended, shall cease for any reason to constitute at least a majority thereof; or  

(c)there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) more than 50% of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation, and in which no “person” (as defined under paragraph (a) above) acquires 50% or more of the combined voting power of the securities of the Company or such surviving entity or parent thereof outstanding immediately after such merger or consolidation; or  

(d)there is consummated a plan of complete liquidation or dissolution of the Company or there is consummated the sale or disposition by the Company of all or substantially all of the Company's assets, other than a sale or disposition by the Company of all or substantially all of the Company's assets to an entity, more than 50% of the combined voting power of the voting securities of which are owned by stockholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale.

14.2Effect of a Change in Control.  Unless otherwise provided in an agreement evidencing an Incentive Award, the following provisions shall apply to outstanding Incentive Awards in the event of a Change in Control.  

(a)Continuation, Assumption or Replacement of Incentive Awards.  In the event of a Change in Control, the surviving or successor entity (or its parent corporation) may continue, assume or replace Incentive Awards outstanding as of the date of the Change in Control (with such adjustments as may be required or permitted by Section 4.3), and such Incentive Awards or replacements therefore shall remain outstanding and be governed by their respective terms, subject to Section 14.2(d) below.  A surviving or successor entity may elect to continue, assume or replace only some Incentive Awards or portions of Incentive Awards.  For purposes of this Section 14.2(a), an Incentive Award shall be considered assumed or replaced if, in connection with the Change in Control and in a manner consistent with Sections 409A and 424 of the Code, either (i) the contractual obligations represented by the Incentive Award are expressly assumed by the surviving or successor entity (or its parent corporation) with appropriate adjustments to the number and type of securities subject to the Incentive Award and the exercise price thereof that preserves the intrinsic value of the Incentive Award existing at the time of the Change in Control, or (ii) the Participant has received a comparable equity-based award that preserves the intrinsic value of the Incentive Award existing at the time of the Change in Control and

16

provides for a vesting or exercisability schedule that is the same as or more favorable to the Participant.  

(b)Acceleration of Incentive Awards.  If and to the extent that outstanding Incentive Awards under the Plan are not continued, assumed or replaced in connection with a Change in Control, then (i) outstanding Options and Stock Appreciation Rights issued to the Participant that are not yet fully exercisable shall immediately become exercisable in full (immediately prior to and contingent upon the Change in Control) and shall remain exercisable in accordance with their terms, (ii) all unvested Restricted Stock Awards, Stock Unit Awards and Performance Awards will become immediately fully vested and non-forfeitable; and (iii) any Performance Criteria applicable to Restricted Stock Awards, Stock Unit Awards and Performance Awards will be deemed to have been satisfied at the target level of performance specified in connection with the applicable Incentive Award.

(c)Payment for Incentive Awards.  If and to the extent that outstanding Incentive Awards under the Plan are not continued, assumed or replaced in connection with a Change in Control, then the Committee may terminate some or all of such outstanding Incentive Awards, in whole or in part, as of the effective time of the Change in Control in exchange for payments to the holders as provided in this Section 14.2(c).  The Committee will not be required to treat all Incentive Awards similarly for purposes of this Section 14.2(c).  The payment for any Incentive Award or portion thereof terminated shall be in an amount equal to the excess, if any, of (i) the fair market value (as determined in good faith by the Committee) of the consideration that would otherwise be received in the Change in Control for the number of shares of Common Stock subject to the Incentive Award or portion thereof being terminated, or, if no consideration is to be received by the Company’s stockholders in the Change in Control, the Fair Market Value of such number of shares immediately prior to the effective date of the Change in Control, over (ii) the aggregate exercise price (if any) for the shares of Common Stock subject to the Incentive Award or portion thereof being terminated.  If there is no excess, the Incentive Award may be terminated without payment.  Any payment shall be made in such form, on such terms and subject to such conditions as the Committee determines in its discretion, which may or may not be the same as the form, terms and conditions applicable to payments to the Company’s stockholders in connection with the Change in Control, and may include subjecting such payments to vesting conditions comparable to those of the Incentive Award surrendered.  

(d)Termination After a Change in Control.  If and to the extent that Incentive Awards are continued, assumed or replaced under the circumstances described in Section 14.2(a), and if within two years after the Change in Control a Participant experiences an involuntary termination of employment or other service for reasons other than Cause, or terminates his or her employment or other service for Good Reason, then (i) outstanding Options and Stock Appreciation Rights issued to the Participant that are not yet fully exercisable shall immediately become exercisable in full and shall remain exercisable in accordance with their terms, (ii) all unvested Restricted Stock Awards, Stock Unit Awards and Performance Awards will become immediately fully vested and non-forfeitable; and (iii) any Performance Criteria applicable to Restricted Stock Awards, Stock Unit Awards and Performance Awards will be deemed to have been satisfied at the target level of performance specified in connection with the applicable Incentive Award.

17

15.Rights of Eligible Recipients and Participants; Transferability.

15.1Employment or Service.  Nothing in the Plan will interfere with or limit in any way the right of the Company or any Subsidiary to terminate the employment or service of any Eligible Recipient or Participant at any time, nor confer upon any Eligible Recipient or Participant any right to continue in the employ or service of the Company or any Subsidiary.

15.2Rights as a Stockholder; Dividends.  As a holder of Incentive Awards (other than Restricted Stock Awards), a Participant will have no rights as a stockholder unless and until such Incentive Awards are exercised for, or paid in the form of, shares of Common Stock and the Participant becomes the holder of record of such shares.  Except as otherwise provided in the Plan or otherwise provided by the Committee, no adjustment will be made in the amount of cash payable or in the number of shares of Common Stock issuable under Incentive Awards denominated in or based on the value of shares of Common Stock as a result of cash dividends or distributions paid to holders of Common Stock prior to the payment of, or issuance of shares of Common Stock under, such Incentive Awards.  In its discretion, the Committee may provide in an agreement evidencing a Stock Unit Award or a Performance Award that the Participant will be entitled to receive dividend equivalents, in the form of a cash credit to an account for the benefit of the Participant or as accumulated additional units, for any such dividends and distributions.  The terms of any rights to dividend equivalents will be determined by the Committee and set forth in the agreement evidencing the Stock Unit Award or Performance Award, including the time and form of payment and whether such equivalents will be credited with interest or deemed to be reinvested in Common Stock; provided, however, that dividend equivalents in respect of the unvested portions of Stock Unit Awards and Performance Awards will in all cases be subject to the same restrictions and risks of forfeiture as the underlying shares or units to which such dividend equivalents relate.  No dividend equivalents may be paid or credited in connection with Options and Stock Appreciation Rights.

15.3Restrictions on Transfer.

(a)Except pursuant to testamentary will or the laws of descent and distribution or as otherwise expressly permitted by subsections (b) and (c) below, no right or interest of any Participant in an Incentive Award prior to the exercise (in the case of Options or Stock Appreciation Rights) or vesting or issuance (in the case of Restricted Stock Awards, Stock Unit Awards and Performance Awards) of such Incentive Award will be assignable or transferable, or subjected to any lien, during the lifetime of the Participant, either voluntarily or involuntarily, directly or indirectly, by operation of law or otherwise.

(b)A Participant will be entitled to designate a beneficiary to receive an Incentive Award upon such Participant’s death, and in the event of such Participant’s death, payment of any amounts due under the Plan will be made to, and exercise of any Options or Stock Appreciation Rights (to the extent permitted pursuant to Section 12 of the Plan) may be made by, such beneficiary.  If a deceased Participant has failed to designate a beneficiary, or if a beneficiary designated by the Participant fails to survive the Participant, payment of any amounts due under the Plan will be made to, and exercise of any Options or Stock Appreciation Rights (to the extent permitted pursuant to Section 12 of the Plan) may be made by, the Participant's legal representatives, heirs and legatees.  If a deceased

18

Participant has designated a beneficiary and such beneficiary survives the Participant but dies before complete payment of all amounts due under the Plan or exercise of all exercisable Options or Stock Appreciation Rights, then such payments will be made to, and the exercise of such Options or Stock Appreciation Rights may be made by, the legal representatives, heirs and legatees of the beneficiary.

(c)Upon a Participant’s request, the Committee may, in its sole discretion, permit a transfer of all or a portion of a Non-Statutory Stock Option or Stock Appreciation Right, other than for value, to such Participant’s child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, any person sharing such Participant’s household (other than a tenant or employee), a trust in which any of the foregoing have more than fifty percent of the beneficial interests, a foundation in which any of the foregoing (or the Participant) control the management of assets, and any other entity in which these persons (or the Participant) own more than fifty percent of the voting interests.  Any permitted transferee will remain subject to all the terms and conditions applicable to the Participant prior to the transfer.  A permitted transfer may be conditioned upon such requirements as the Committee may, in its sole discretion, determine, including, but not limited to execution and/or delivery of appropriate acknowledgements, opinion of counsel, or other documents by the transferee.

15.4Non-Exclusivity of the Plan.  Nothing contained in the Plan is intended to modify or rescind any previously approved compensation plans or programs of the Company or create any limitations on the power or authority of the Board to adopt such additional or other compensation arrangements as the Board may deem necessary or desirable.

16.Securities Law and Other Restrictions.

Notwithstanding any other provision of the Plan or any agreements entered into pursuant to the Plan, the Company will not be required to issue any shares of Common Stock under this Plan, and a Participant may not sell, assign, transfer or otherwise dispose of shares of Common Stock issued pursuant to Incentive Awards granted under the Plan, unless (a) there is in effect with respect to such shares a registration statement under the Securities Act and any applicable securities laws of a state or foreign jurisdiction or an exemption from such registration under the Securities Act and applicable state or foreign securities laws, and (b) there has been obtained any other consent, approval or permit from any other U.S. or foreign regulatory body which the Committee, in its sole discretion, deems necessary or advisable.  The Company may condition such issuance, sale or transfer upon the receipt of any representations or agreements from the parties involved, and the placement of any legends on certificates representing shares of Common Stock, as may be deemed necessary or advisable by the Company in order to comply with such securities law or other restrictions.

17.[RESERVED].

19

18.Compliance with Section 409A.  

It is intended that the Plan and all Incentive Awards hereunder be administered in a manner that will comply with Section 409A of the Code, including the final regulations and other guidance issued by the Secretary of the Treasury and the Internal Revenue Service with respect thereto.  The Committee is authorized to adopt rules or regulations deemed necessary or appropriate to qualify for an exception from or to comply with the requirements of Section 409A of the Code (including any transition or grandfather rules relating thereto).  Notwithstanding anything in this Section 18 to the contrary, with respect to any Incentive Award subject to Section 409A of the Code, no amendment to or payment under such Incentive Award will be made unless permitted under Section 409A of the Code and the regulations or rulings issued thereunder.  Without limiting the generality of the foregoing, if any amount shall be payable with respect to any Incentive Award hereunder as a result of a Participant’s “separation from service” at such time as the Participant is a “specified employee” (as those terms are defined for purposes of Section 409A of the Code) and such amount is subject to the provisions of Section 409A of the Code, then no payment shall be made, except as permitted under Section 409A of the Code, prior to the first day of the seventh calendar month beginning after the Participant’s separation from service (or the date of his or her earlier death).  The Company may adopt a specified employee policy that will apply to identify the specified employees for all deferred compensation plans subject to Section 409A of the Code; otherwise, specified employees will be identified using the default standards contained in the regulations under Section 409A of the Code.

Notwithstanding anything to the contrary in this Plan, none of the Company, the Committee nor any other person involved with the administration of this Plan shall in any way be responsible for ensuring the exemption of any Incentive Award from, or compliance by any Incentive Award with, the requirements of Section 409A of the Code.  By accepting an Incentive Award under this Plan, each Participant acknowledges that neither the Company, the Committee nor any other person involved with the administration of this Plan has any duty or obligation to design or administer the Plan or Incentive Awards granted thereunder in a manner that minimizes a Participant’s tax liabilities, including the avoidance of any additional tax liabilities under Section 409A of the Code.

19.Amendment, Modification and Termination.  

The Board may suspend or terminate the Plan or any portion thereof at any time.  In addition to the authority of the Committee to amend the Plan under Section 3.2(e), the Board may amend the Plan from time to time in such respects as the Board may deem advisable in order that Incentive Awards under the Plan will conform to any change in applicable laws or regulations or in any other respect the Board may deem to be in the best interests of the Company; provided, however, that no such amendments to the Plan will be effective without approval of the Company’s stockholders if: (i) stockholder approval of the amendment is then required pursuant to Section 422 of the Code or the rules of the New York Stock Exchange; or (ii) such amendment seeks to modify Section 3.2(d) hereof.  No termination, suspension or amendment of the Plan may adversely affect any outstanding Incentive Award without the consent of the affected Participant; provided, however, that (i) this sentence will not impair the right of the Committee to take whatever action it deems appropriate under Sections 3.2(c), 4.3 and 14 of the Plan, and (ii) no consent of any affected Participant shall be required if such amendment is necessary to comply with

20

applicable law or stock exchange rules.

20.Effective Date and Duration of the Plan.

The Plan shall became effective as of the date on which it was approved by the Company’s stockholders (the “Effective Date”).  The Plan will terminate at midnight on the tenth (10th) anniversary of the Effective Date and may be terminated prior to such time by Board action.  No Incentive Award will be granted after termination of the Plan.  Incentive Awards outstanding upon termination of the Plan may continue to be exercised, earned or become free of restrictions, according to their terms.  

21.Miscellaneous.

21.1Governing Law. Except to the extent expressly provided herein or in connection with other matters of corporate governance and authority (all of which shall be governed by the laws of the State of Delaware), the validity, construction, interpretation, administration and effect of the Plan and any rules, regulations and actions relating to the Plan will be governed by and construed exclusively in accordance with the laws of the State of Minnesota, notwithstanding the conflicts of laws principles of any jurisdictions.

21.2Automatic Exercise. The Committee may from time to time, in its sole discretion, provide for and establish procedures with respect to the automatic exercise of Options or Stock Appreciation Rights that are vested and unexercised on the date that such Options or Stock Appreciation Rights would otherwise terminate under the applicable award agreement. Any automatic exercise of an Option covered by any such procedures shall be accomplished using a "net exercise" as provided in Section 6.4(b). In no event shall the Company or its Subsidiaries or their respective employees or agents be liable for any damages whatsoever arising out of or in any way related to any use of any automatic exercise procedures.

21.3Successors and Assigns.  The Plan will be binding upon and inure to the benefit of the successors and permitted assigns of the Company and the Participants.

21.4Forfeiture and Compensation Recovery.

(a)Incentive Awards granted hereunder shall be subject to the Company’s Policy on Reimbursement of Incentive Payments, as may be amended from time to time, and any other future clawback policy that may be approved by the Company. In addition, the Committee may specify in an agreement evidencing an Incentive Award that the Participant’s rights, payments, and benefits with respect to such Award will be subject to reduction, cancellation, forfeiture or recovery by the Company upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Incentive Award. Such events may include termination of employment or other service for Cause; violation of any material Company or Subsidiary policy; breach of noncompetition, non-solicitation or confidentiality provisions that apply to the Participant; a determination that the payment of the Incentive Award was based on an incorrect determination that financial or other Performance Criteria were met or other conduct by the Participant that is detrimental to the business or reputation of the Company or its Subsidiaries.

21

(b)Incentive Awards and any compensation associated therewith may be made subject to forfeiture, recovery by the Company or other action pursuant to any compensation recovery policy adopted by the Board or the Committee at any time, including in response to the requirements of Section 10D of the Exchange Act and any implementing rules and regulations thereunder, or as otherwise required by law. Any agreement evidencing an Incentive Award may be unilaterally amended by the Committee to comply with any such compensation recovery policy.

22

EX-10.2

Exhibit (10.2)

ECOLAB INC. (the "Company")
NON-STATUTORY STOCK OPTION AGREEMENT

ARTICLE 1.GRANT OF OPTION

The Company has adopted the Ecolab Inc. 2023 Stock Incentive Plan (the "Plan") to grant non-statutory stock options to employees, consultants, advisors and independent contractors of the Company and its Subsidiaries. The Company hereby grants to you (the "Optionee") on the date set forth in your grant notice (the "Date of Grant") a non-statutory stock option (the "Option") to purchase the number of shares set forth in the Optionee's grant notice (the "Option Shares") of the Company's common stock, $1.00 par value (the "Common Stock"). The Option and Option Shares are subject to the terms, conditions, restrictions and risk of forfeiture set forth in this agreement (the "Agreement") and in the Plan. The Option is not intended to be an "incentive stock option" as that term is used in Section 422 of the Code.

ARTICLE 2.OPTION EXERCISE PRICE

The per share price to be paid by Optionee in the event of an exercise of the Option is set forth in the Optionee's grant notice.

ARTICLE 3.DURATION OF OPTION AND TIME OF EXERCISE

3.1Period of Exercisability. Subject to Section 3.2 below, the Option will become exercisable, on a cumulative basis, on each anniversary of the Date of Grant as to the percentage of the Option Shares (excluding any fractional portion less than one share) according to the schedule specified in the Optionee's grant notice, provided the Optionee remains in the continuous employ of or service with the Company or any Subsidiary. This Option will expire and will no longer be exercisable as to any unexercised Option Shares at 5:00 p.m. (St. Paul, Minnesota time) on the earliest of:

(a)the tenth anniversary of the Date of Grant ("Expiration Date");

(b)upon termination of the Optionee's employment by or service to the Company and all Subsidiaries upon a determination by the Committee that Cause exists;

(c)upon the expiration of any applicable period specified in Section 3.2 below during which the Option may be exercised after a termination of the Optionee's employment by or service to the Company and all Subsidiaries; or

(d)the date, if any, fixed for termination of this Option pursuant to Section 14.2(c) of the Plan.

3.2Termination of Employment or Other Service. The effect of the termination of the Optionee's employment by or service to the Company and all Subsidiaries prior to the Expiration Date will be as provided below and subject to Section 12.2 of the Plan which provides that in the event that the Optionee is determined to have committed any action which would constitute Cause, all rights of the Optionee under the Plan shall terminate and be forfeited without notice of any kind:

(a)Termination of Employment Due to Death or Disability. In the event an Optionee’s employment by or service to the Company and all Subsidiaries is terminated by reason of death or Disability, all outstanding Options then held by the Optionee will become immediately exercisable in full and will remain exercisable for a period of five years after such termination (but in no event after the Expiration Date).

(b)Termination of Employment Due to Retirement. In the event an Optionee’s employment by or service to the Company and all Subsidiaries is terminated by reason of Retirement, all outstanding Options then held by the Optionee that have been outstanding for at least six months from the Date of Grant will become immediately exercisable in full and will remain exercisable for a period of five years after such termination (but in no event after the Expiration Date), and any Options then held by the Optionee that have not been outstanding for at least six months will terminate and be forfeited.

(c)Termination of Employment for Reasons Other than Death, Disability or Retirement. In the event an Optionee’s employment by or service to the Company and all Subsidiaries is terminated for any reason other than death, Disability, Retirement,  or other than a termination following a Change in Control (that is addressed in Section 3.3 below), or an Optionee is in the employ or service of a Subsidiary and the Subsidiary ceases to be a Subsidiary of the Company (unless the Optionee continues in the employ or service of the Company or another Subsidiary),  all outstanding Options then held by the Optionee will, to the extent exercisable as of such termination, remain exercisable for a period of three months after such termination (but in no event after the Expiration Date), and will, to the extent not exercisable as of such termination, terminate and be forfeited.

3.3Change in Control. If a Change in Control occurs prior to the Expiration Date, the effect on this Option shall be as provided in Section 14.2 of the Plan, such that if within two years after the Change in Control an Optionee experiences an involuntary termination of employment or other service for reasons other than Cause, or terminates his or her employment or other service for Good Reason, as specifically defined in Exhibit A of this Agreement, then all outstanding Options then held by the Optionee that are not yet fully exercisable shall immediately become exercisable in full and shall remain exercisable in accordance with the terms of this Agreement.

ARTICLE 4.MANNER OF OPTION EXERCISE

4.1Notice. This Option may be exercised by the Optionee in whole or in part from time to time, subject to the conditions contained in the Plan and in this Agreement, by giving written or electronic notice of exercise (in person, by mail, by facsimile or by electronic transmission) to the Company at its principal executive office in St. Paul, Minnesota (Attention: Sr. Vice President-Human Resources), or through the procedures established with any Company-appointed third-party administrator. Such notice will be in a form satisfactory to the Committee, will identify the Option, will specify the number of Option Shares with respect to which the Option is being exercised, and will be signed (Including, if applicable, by electronic signature as provided in Section 12.7 of this Agreement) by the person or persons so exercising the Option. Such notice will be accompanied by payment in full of the total purchase price of the Option Shares purchased. If the Option is being exercised, as provided by the Plan, by any person or persons other than the Optionee, the notice will be accompanied by appropriate proof of right of such person or persons to exercise the Option. As soon as practicable after the effective exercise of the Option, the Optionee will be recorded on the stock transfer books of the Company as the owner of the Option Shares purchased, and the Company will deliver to the Optionee certificated or uncertificated ("book entry") shares. If the Option is being exercised by tender of a Broker Exercise Notice, the Company will deliver such shares directly to the Optionee's broker or dealer or their nominee.

2

4.2Payment. At the time of exercise of this Option, the Optionee will pay the total purchase price of the Option Shares to be purchased solely in cash (including a check, bank draft or money order, payable to the order of the Company); provided, however, that the Committee, in its sole discretion, may allow such payment to be made, in whole or in part, (i) by tender of a Broker Exercise Notice, (ii) by delivery to the Company (either actually or by attestation as to ownership) of Previously Acquired Shares that are acceptable to the Committee, (iii) by a "net exercise" as described in Section 6.4(b) of the Plan, or (iv) by a combination of such methods. If the Optionee is permitted to pay the purchase price of Option Shares to be purchased in whole or in part by delivery of Previously Acquired Shares or by a net exercise, the value of such shares delivered to or retained by the Company will be equal to their Fair Market Value on the date of exercise of this Option.

4.3Automatic Exercise. Notwithstanding anything to the contrary in the Agreement or the Plan, the exercisable portion of the Option that remains outstanding on the last business day prior to the Expiration Date (the “Automatic Exercise Date”) shall be deemed to have been exercised by the Optionee, without any further action or notice by the Company or the Optionee, at such time if: (i) the Optionee remains in the continuous employ of or service with the Company or any Subsidiary. on the Automatic Exercise Date; and (ii) the Fair Market Value of an Option Share on the Automatic Exercise Date exceeds the purchase price of the Option Share. The exercise of the Option pursuant to this Section 4.3 shall be effected by a "net exercise" as described in Section 6.4(b) of the Plan.  Notwithstanding the foregoing, there is no guarantee that an automatic exercise pursuant to this Section 4.3 will be effected on the Optionee’s behalf and neither the Company nor any other party will bear any responsibility or liability if such an automatic exercise is not effected and instead the Option expires unexercised. Accordingly, the Optionee shall bear sole responsibility for ensuring that the Optionee exercises the Option prior to the Expiration Date.

ARTICLE 5.NONTRANSFERABILITY

Neither this Option nor the Option Shares acquired upon exercise may be transferred by the Optionee, either voluntarily or involuntarily, or subjected to any lien, directly or indirectly, by operation of law or otherwise, except as provided in the Plan. Any attempt to transfer or encumber this Option or the Option Shares other than in accordance with this Agreement and the Plan will be null and void and will void this Option.

ARTICLE 6.EMPLOYMENT OR OTHER SERVICE

Nothing in this Agreement will be construed to (a) limit in any way the right of the Company to terminate the employment or service of the Optionee at any time, or (b) be evidence of any agreement or understanding, express or implied, that the Company will retain the Optionee in any particular position, at any particular rate of compensation or for any particular period of time.

ARTICLE 7.WITHHOLDING TAXES

By accepting this Award, the Optionee (i) acknowledges his or her obligation to make arrangements acceptable to the Company for payment of any federal, state, local or foreign withholding or employment-related taxes that may be due as a result of the grant or exercise of this Option, (ii) authorizes the Company (or any Subsidiary) to withhold from payroll or other amounts payable to the Optionee any sums required to satisfy such tax obligations, and (iii) otherwise agrees to satisfy such obligations in accordance with the provisions of Section 13 of the Plan. If the Optionee desires to satisfy some or all of such tax obligations by delivering (actually or through attestation of ownership) Previously Acquired

3

Shares or by having the Company retain a portion of the Shares otherwise issuable upon exercise of the Option, the Optionee must make such a request which shall be subject to approval by the Company. For purposes of satisfying the Optionee's withholding and employment-related tax obligations, Previously Acquired Shares or Shares retained by the Company will be valued at their Fair Market Value on the date of exercise of the Option. Delivery of Shares upon exercise of this Option is subject to the satisfaction of applicable withholding and employment-related tax obligations.

ARTICLE 8.ADJUSTMENTS

The number and kind of securities subject to this Option and the exercise price of this Option will be subject to adjustment under the circumstances and to the extent specified in Section 4.3 of the Plan.

ARTICLE 9.AUTHORIZATION TO RELEASE AND TRANSFER NECESSARY PERSONAL INFORMATION

The Optionee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Optionee's personal data by and among, as applicable, the Company for the exclusive purpose of implementing, administering and managing the Optionee's participation in the Plan. The Optionee understands that the Company may hold certain personal information about the Optionee, including, but not limited to, the Optionee's name, home address and telephone number, date of birth, social security number (or any other social or national identification number), salary, nationality, job title, number of Options and/or shares of Common Stock held and the details of all Options or any other entitlement to shares of Common Stock awarded, cancelled, vested, unvested or outstanding for the purpose of implementing, administering and managing the Optionee's participation in the Plan (the "Data"). The Optionee understands that the Data may be transferred to the Company or to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in the Optionee's country or elsewhere, and that any recipient's country (e.g., the United States) may have different data privacy laws and protections than the Optionee's country. The Optionee understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative or the Company's stock plan administrator. The Optionee authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing the Optionee's participation in the Plan, including any requisite transfer of such Data to a broker or other third party assisting with the administration of Options under the Plan or with whom shares of Common Stock acquired pursuant to the exercise of the Options or cash from the sale of such shares may be deposited. Furthermore, the Optionee acknowledges and understands that the transfer of the Data to the Company or to any third parties is necessary for the Optionee's participation in the Plan. The Optionee understands that the Optionee may, at any time, view the Data, request additional information about the storage and processing of the Data, require any necessary amendments to the Data or refuse or withdraw the consents herein by contacting the Optionee's local human resources representative or the Company's stock plan administrator in writing. The Optionee further acknowledges that withdrawal of consent may affect his or her ability to vest in or realize benefits from the Option, and the Optionee's ability to participate in the Plan. For more information on the consequences of refusal to consent or withdrawal of consent, the Optionee understands that he or she may contact his or her local human resources representative or the Company's stock plan administrator.

ARTICLE 10.SUBJECT TO PLAN

10.1Terms of Plan Prevail. The Option has been and the Option Shares granted and issued pursuant to this Agreement will be granted and issued under, and are subject to the terms of, the Plan. The terms of the Plan are incorporated by reference in this Agreement in their

4

entirety, and the Optionee, by execution of this Agreement, acknowledges having received a copy of the Plan. The provisions of this Agreement will be interpreted as to be consistent with the Plan, and any ambiguities in this Agreement will be interpreted by reference to the Plan. In the event that any provision of this Agreement is inconsistent with the terms of the Plan, the terms of the Plan will prevail. References in this Agreement to specific Sections of the Plan refer to those Sections of the Plan as in effect on the Date of Grant.

10.2Definitions. Unless otherwise defined in this Agreement, the terms capitalized in this Agreement have the same meanings as given to such terms in the Plan, as in effect on the Date of Grant.

ARTICLE 11.RIGHTS AS A STOCKHOLDER

Neither the Optionee nor any other person entitled to exercise the Option will have any rights as a stockholder with respect to any of the Option Shares until the Option has been exercised in accordance with this Agreement and the Optionee or such other person becomes the holder of record of the resulting shares of Common Stock as provided in Section 4.1 above.

ARTICLE 12.MISCELLANEOUS

12.1Binding Effect. This Agreement will be binding upon the heirs, executors, administrators and successors of the parties to this Agreement.

12.2Governing Law. This Agreement and all rights and obligations under this Agreement will be construed in accordance with the Plan and governed by the laws of the State of Minnesota without regard to conflicts of laws provisions. Any legal proceedings related to this Agreement will be brought in an appropriate Minnesota court, and the parties to this Agreement consent to the exclusive jurisdiction of the court for this purpose.

12.3Entire Agreement. This Agreement and the Plan set forth the entire agreement and understanding of the parties to this Agreement with respect to the grant and exercise of this Option and the administration of the Plan and supersede all prior agreements, arrangements, plans and understandings relating to the grant and exercise of this Option and the administration of the Plan.

12.4Amendment and Waiver. Other than as provided in the Plan, this Agreement may be amended, waived, modified or canceled only by a written instrument executed by the parties hereto or, in the case of a waiver, by the party waiving compliance.

12.5Captions. The Article, Section and paragraph captions in this Agreement are for convenience of reference only, do not constitute part of this Agreement and are not to be deemed to limit or otherwise affect any of the provisions of this Agreement.

12.6Counterparts. For convenience of the parties hereto, this Agreement may be executed in any number of counterparts, each such counterpart to be deemed an original instrument, and all such counterparts together to constitute the same agreement.

12.7Electronic Delivery and Execution. The Optionee hereby consents and agrees to electronic delivery of any documents that the Company may elect to deliver (including, but not limited to, plan documents, prospectus and prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this and any other Incentive Award made or offered under the Plan. The Optionee understands that, unless revoked by giving written notice to

5

the Company pursuant to the Plan, this consent will be effective for the duration of the Agreement. The Optionee also understands that the Optionee will have the right at any time to request that the Company deliver written copies of any and all materials referred to above. The Optionee hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may elect to deliver, and agrees that the Optionee's electronic signature is the same as, and will have the same force and effect as, the Optionee's manual signature. The Optionee consents and agrees that any such procedures and delivery may be effected by a third party engaged by the Company to provide administrative services related to the Plan.

12.8Address for Notice. All notices to the Company shall be in writing and sent to the Company's General Counsel at the Company's corporate headquarters. Notices to the Optionee shall be addressed to the Optionee at the address as from time to time reflected in the Company's or Subsidiary's employment records as the Optionee's address.

12.9Severability. In the event that any provision in this Agreement shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement.

12.10Appendix. Notwithstanding any provision of this Agreement to the contrary, this Option and the shares of Common Stock acquired under the Plan upon its exercise shall be subject to any and all special terms and provisions, if any, as set forth in the Appendix for the Optionee's country of residence.

6

Exhibit A

The following provision will be applicable instead of the definition set forth in Section 2.13 of the Plan:

2.13 “Good Reason” means, unless otherwise set forth in an agreement between the Company and the Participant, without the express written consent of the affected Participant, any of the following events involving the Company or Subsidiary that employs or receives services from the Participant:

(a) the assignment to the Participant of any duties inconsistent in any substantial respect with the Participant’s position, authority or responsibilities as in effect during the 90-day period immediately preceding the Change in Control which assignment results in a substantial diminution in such position, authority or responsibilities or any other substantial adverse change in such position (including titles), authority or responsibilities, excluding an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company or applicable Subsidiary as set forth below;

(b)any failure by the Company or applicable Subsidiary to furnish the Participant with compensation and benefits at a level substantially equal to or exceeding those received by the Participant from the Company or applicable Subsidiary during the 90-day period preceding the Change in Control, other than (i) an insubstantial and inadvertent failure remedied by the Company or applicable Subsidiary as set forth below, (ii) a reduction in compensation which is applied to all non-union employees of the Company or applicable Subsidiary in the same dollar amount or percentage, or (iii) a reduction or modification of any employee benefit program covering substantially all of the employees of the Company or applicable Subsidiary, which reduction or modification generally applies to all employees covered under such program; or

(c)the Company or applicable Subsidiary requiring the Participant to be based or to perform services at any office or location that is in excess of 50 miles from the principal location of the Participant’s work during the 90-day period immediately preceding the Change in Control, except for travel reasonably required in the performance of the Participant’s responsibilities.

Before a termination by the Participant under this Section 2.13 will constitute termination for Good Reason, the Participant must give the Company a notice of termination within 30 calendar days of the occurrence of the event that constitutes Good Reason. The notice must set forth in reasonable detail the specific reason for the termination and the facts and circumstances claimed to provide a basis for termination of employment under the provision indicated. Failure to provide such notice within such 30-day period shall be conclusive proof that the Participant does not have Good Reason to terminate employment.

For purposes of this Section 2.13, Good Reason shall exist only if the Company or applicable Subsidiary fails to remedy the event or events constituting Good Reason within 30 calendar days after receipt of the notice of termination from the Participant. If the Participant determines Good Reason for termination exists and timely files a notice of termination, such determination shall be presumed to be true and the Company will have the burden of proving that Good Reason does not exist.

7

EX-10.3

Exhibit (10.3)

ECOLAB INC. (the "Company")
PERFORMANCE-BASED
RESTRICTED STOCK UNIT AWARD AGREEMENT

ARTICLE 1.GRANT OF AWARD

The Company has adopted the Ecolab Inc. 2023 Stock Incentive Plan (the "Plan") to grant a performance-based restricted Stock Unit Awards to certain employees of the Company and its Subsidiaries. The Company hereby grants to you (the "Grantee") on the date set forth in your grant notice (the "Date of Grant") a restricted Stock Unit Award (the "Award") consisting of the number of units set forth in the Grantee's grant notice (the "Award Units"), each of which is a bookkeeping entry representing the right to receive one share of the Company's common stock, par value $1.00 per share (the "Common Stock"). The Award and Award Units are subject to the terms, conditions, restrictions and risk of forfeiture set forth in this agreement (the "Agreement") and in the Plan.

ARTICLE 2.VESTING OF AWARD UNITS

2.1Vesting Date and Conditions.Subject to Article 5 below, some or all of the Award Units will vest and become non-forfeitable ("Vested") on the date(s) set forth in the Grantee's grant notice (the "Vesting Date"), provided that (a) the Committee has certified that the Company has achieved a level of average annual Return on Invested Capital (as defined below) of at least the threshold amount set forth in the grant notice for the three (3) year period set forth in the grant notice (the "Performance Period"), and (b) the Grantee remains in the continuous employ of or service with the Company or any Subsidiary until the Vesting Date. The number of Award Units that will be Vested on the Vesting Date will be determined in accordance with Section 2.2 below.

2.2Determining Number of Vested Units.The percentage of the Award Units (or of a portion of the Award Units as provided in Section 5.1 of this Agreement) that will vest on the Vesting Date based upon the Company's level of achievement of average annual Return on Invested Capital for the Performance Period will be as set forth in the grant notice. The actual percentage of Award Units that will Vest based upon the Company's achievement of average annual Return on Invested Capital between the Threshold Level and Maximum Level will be interpolated on a straight line basis, with the corresponding number of Vested Award Units resulting from such determination rounded up to the next whole Award Unit. If the average annual Return on Invested Capital for the Performance Period is below the Threshold Level, no Award Units will Vest. Any Award Units that do not Vest on the Vesting Date will be forfeited.

2.3Committee Certification.The Committee shall certify the level of average annual Return on Invested Capital for the Performance Period and the percentage of Award Units that are Vested as provided in Section 2.2 above no later than March 1 of the year following the end of the Performance Period.

2.4Definitions and Calculations.For purposes of this Agreement, the following amounts and terms shall be calculated and defined as follows:

(a)"Average Annual Return on Invested Capital" shall be calculated by dividing (i) the average of the Company's Net Operating Profit After Taxes (as defined below) for each of the three fiscal years during the Performance Period, by (ii) the average of the Company's Invested Capital (as defined below) as of the last day of the fiscal quarter immediately

preceding the Performance Period and the last day of each fiscal quarter during the Performance Period.

(b)"Net Operating Profit After Taxes" is defined as the Company's operating income multiplied by 1 minus the Company's effective tax rate, each as reported in the Company's consolidated financial statements for each fiscal year during the Performance Period, adjusted to eliminate (i) the after-tax effect of additional depreciation and amortization expense resulting from fair value adjustments to assets acquired as a part of Board-approved acquisitions and certified by the Committee to be included among the adjustments to the Average Annual Return on Invested Capital calculation and the after-tax effect of special gains and charges related to such acquisitions; and (ii) (A) the cumulative effects of accounting or tax changes, (B) gains and losses from discontinued operations, (C) the cumulative effect of events occurring during the Performance Period that are unusual in nature or occur infrequently or both, and (D) charges for restructurings, each as defined by generally accepted accounting principles and as identified in the Company's financial statements (including accompanying notes), management's discussion and analysis or other filings with the Securities and Exchange Commission by the Company, and in each case certified by the Committee to be included among the adjustments to the Average Annual Return on Invested Capital calculation.

(c)"Invested Capital" is defined as the Company's (i) total assets less cash and cash equivalents, minus (ii) total liabilities less short-term and long-term debt, each as reported by the Company as of the end of the fiscal quarters described in Section 2.4(a) with adjustments as certified by the Committee to eliminate the impact of the same factors identified in clauses (i) and (ii) of Section 2.4(b).

2.5Committee Discretion.The Committee may adjust the calculation of Return on Invested Capital applicable to the Award Units under the circumstances, for the purpose and to the extent contemplated by Section 3.2(c) of the Plan. Further, the actual number of Award Units that become Vested based upon achieving the specified level of average annual Return on Invested Capital during the Performance Period may be adjusted by the Committee in its sole and absolute discretion based on such factors as the Committee determines to be appropriate and/or advisable.

ARTICLE 3.SETTLEMENT OF VESTED AWARD UNITS

Except as may otherwise be provided in Section 5.2 below, Vested Award Units will be paid to the Grantee by no later than March 15 of the year following the end of the Performance Period. Each Vested Award Unit will be paid to the Grantee in one share of Common Stock, provided that the Company will have no obligation to issue shares of Common Stock pursuant to this Agreement unless and until the Grantee has satisfied any applicable tax obligations pursuant to Article 9 below and such issuance otherwise complies with all applicable law. Prior to the time the Vested Award Units are settled, the Grantee will have no rights other than those of a general creditor of the Company. The Award Units represent an unfunded and unsecured obligation of the Company.

ARTICLE 4.GRANT RESTRICTIONS

4.1Transferability.Any attempt to transfer, assign or encumber the Award Units other than in accordance with this Agreement and the Plan will be null and void, and will result in the immediate termination and forfeiture of the Award and all Award Units that have not yet Vested.

2

4.2Dividends and Other Distributions.Subject to Article 6 of this Agreement, the Grantee will have no right to receive dividends, dividend equivalents or other distributions with respect to Award Units.

ARTICLE 5.TERMINATION OF EMPLOYMENT OR OTHER SERVICE; CHANGE IN CONTROL

5.1Termination of Employment or Other Service.This Award is considered a Stock Unit Award subject to a service-based vesting condition and to the achievement of a specified Performance Criterion as a condition to vesting for purposes of Section 12 of the Plan. Except as otherwise provided in this Section 5.1, the effect of the termination of the Grantee's employment or other service with the Company and all Subsidiaries prior to the Vesting Date of this Award will be as provided in this Section and subject to Section 12.2 of the Plan which provides that in the event that the Grantee is determined to have committed any action which would constitute Cause, all rights of the Grantee under the Plan shall terminate and be forfeited without notice of any kind

(a)Termination of Employment Due to Death or Disability. In the event a Grantee's employment or other service with the Company and all Subsidiaries is terminated by reason of death or Disability, the service-based vesting conditions associated with unvested Award Units then held by the Grantee that are also subject to the achievement of specified Performance Criterion over a performance period as a condition of vesting will be deemed satisfied, but vesting shall occur only when and to the extent the applicable Performance Criterion are satisfied.

(b)Termination of Employment Due to Retirement. In the event a Grantee's employment or other service with the Company and all Subsidiaries is terminated by reason of Retirement, the service-based vesting conditions associated with unvested Award Units then held by the Grantee that are also subject to the achievement of specified Performance Criterion over a performance period as a condition of vesting will be deemed satisfied if such Award Units have been outstanding for at least six months from the Date of Grant, but vesting shall occur only when and to the extent the applicable Performance Criterion are satisfied; and any such Award Units then held by the Grantee that have not been outstanding for at least six months will terminate and be forfeited.Termination of Employment for Reasons Other than Death, Disability or Retirement. In the event a Grantee's employment or other service with the Company and all Subsidiaries is terminated for any reason other than death, Disability, Retirement or other than a termination following a Change in Control (that is addressed in Section 5.2 below), or a Grantee is in the employ or service of a Subsidiary and the Subsidiary ceases to be a Subsidiary of the Company (unless the Grantee continues in the employ or service of the Company or another Subsidiary), all unvested Award Units then held by the Grantee will terminate and be forfeited.

If the Grantee's employment by or other service with the Company and all Subsidiaries is terminated by the Company or any Subsidiary without Cause prior to the Vesting Date, then (i) for purposes of Section 2.1(b) of this Agreement, the Grantee will be deemed to have been in the continuous employ of or service with the Company or any Subsidiary until the Vesting Date with respect to one-third of the Award Units if such termination occurs during the second year of the Performance Period and with respect to two-thirds of the Award Units if the such termination occurs during the third year of the Performance Period, and (ii) for purposes of determining the number of Vested Award Units on the Vesting Date under Section 2.2 of this Agreement, the Vested Award Unit Percentage

3

determined in accordance with Section 2.2 will be applied to the number of Award Units as to which the service-based vesting condition is deemed satisfied in accordance with clause (i) of this sentence, rather than to the total number of Award Units.

5.2Change in Control.If a Change in Control occurs prior to the Vesting Date, the effect on this Award shall be as provided in Section 14.2 of the Plan, such that if within two years after the Change in Control a Grantee experiences an involuntary termination of employment or other service for reasons other than Cause, or terminates his or her employment or other service for Good Reason, as specifically defined in Exhibit A of this Agreement, then all unvested Award Units will become immediately fully vested and non-forfeitable and any Performance Criteria applicable to the Award Units will be deemed to have been satisfied at the target level of performance specified in the Agreement. If vesting of Award Units should be accelerated in accordance with Section 14.2 of the Plan, Vested Unit Awards will be settled and paid to the Grantee no later than two and one-half months after the end of the Grantee's taxable year in which the Award Units became Vested.

ARTICLE 6.ADJUSTMENTS

The number and kind of securities subject to this Award will be subject to adjustment under the circumstances and to the extent specified in Section 4.3 of the Plan.

ARTICLE 7.RIGHTS AS A STOCKHOLDER

The Grantee will have no rights as a stockholder with respect to any of the Award Units until the Award Units are settled following vesting and the Grantee becomes the holder of record of shares of Common Stock.

ARTICLE 8.EMPLOYMENT OR SERVICE

Nothing in this Agreement will be construed to (a) limit in any way the right of the Company to terminate the employment or service of the Grantee at any time, or (b) be evidence of any agreement or understanding, express or implied, that the Company will retain the Grantee in any particular position at any particular rate of compensation or for any particular period of time.

ARTICLE 9.WITHHOLDING TAXES

By accepting this Award, the Grantee (i) acknowledges his or her obligation to pay any federal, foreign, state and local withholding or employment-related taxes attributable to this Award as provided in Section 13 of the Plan, and (ii) consents and directs the Company or its third party administrator to withhold the number of shares of Common Stock issuable upon the vesting of some or all of the Award Units as the Company, in its sole discretion, deems necessary to satisfy such withholding obligations. For purposes of satisfying the Grantee's withholding and employment-related tax obligations, shares withheld by the Company will be valued at their Fair Market Value on the date of settlement.

ARTICLE 10.AUTHORIZATION TO RELEASE AND TRANSFER NECESSARY PERSONAL INFORMATION

The Grantee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Grantee's personal data by and among, as applicable, the Company and its Subsidiaries for the exclusive purpose of implementing, administering and managing the Grantee's participation in the Plan. The Grantee understands that the Company may hold certain personal information about the Grantee, including, but not limited to, the Grantee's name, home address and telephone number, date of birth, social security number (or any other social or national identification

4

number), salary, nationality, job title, number of Award Units and/or shares of Common Stock held and the details of all Award Units or any other entitlement to shares of Common Stock awarded, cancelled, vested, unvested or outstanding for the purpose of implementing, administering and managing the Grantee's participation in the Plan (the "Data"). The Grantee understands that the Data may be transferred to the Company or to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in the Grantee's country or elsewhere, and that any recipient's country (e.g., the United States) may have different data privacy laws and protections than the Grantee's country. The Grantee understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative or the Company's stock plan administrator. The Grantee authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing the Grantee's participation in the Plan, including any requisite transfer of such Data to a broker or other third party assisting with the administration of Award Units under the Plan or with whom shares of Common Stock acquired pursuant to the vesting of the Award Units or cash from the sale of such shares may be deposited. Furthermore, the Grantee acknowledges and understands that the transfer of the Data to the Company or to any third parties is necessary for the Grantee's participation in the Plan. The Grantee understands that the Grantee may, at any time, view the Data, request additional information about the storage and processing of the Data, require any necessary amendments to the Data or refuse or withdraw the consents herein by contacting the Grantee's local human resources representative or the Company's stock plan administrator in writing. The Grantee further acknowledges that withdrawal of consent may affect his or her ability to vest in or realize benefits from the Award Units, and the Grantee's ability to participate in the Plan. For more information on the consequences of refusal to consent or withdrawal of consent, the Grantee understands that he or she may contact his or her local human resources representative or the Company's stock plan administrator.

ARTICLE 11.SUBJECT TO PLAN

11.1Terms of Plan Prevail.The Award and the Award Units granted pursuant to this Agreement have been granted under, and are subject to the terms of, the Plan. The terms of the Plan are incorporated by reference in this Agreement in their entirety, and the Grantee acknowledges having received a copy of the Plan. The provisions of this Agreement will be interpreted as to be consistent with the Plan, and any ambiguities in this Agreement will be interpreted by reference to the Plan. In the event that any provision in this Agreement is inconsistent with the terms of the Plan, the terms of the Plan will prevail. References in this Agreement to specific Sections of the Plan refer to those Sections of the Plan as in effect on the Date of Grant.

11.2Definitions.Unless otherwise defined in this Agreement, the terms capitalized in this Agreement have the same meanings as given to such terms in the Plan as in effect on the Date of Grant.

ARTICLE 12.MISCELLANEOUS

12.1Binding Effect.This Agreement will be binding upon the heirs, executors, administrators and successors of the parties hereto.

12.2Governing Law.This Agreement and all rights and obligations under this Agreement will be construed in accordance with the Plan and governed by the laws of the State of Minnesota without regard to conflicts of law provisions. Any legal proceeding related to

5

this Agreement will be brought in an appropriate Minnesota court, and the parties to this Agreement consent to the exclusive jurisdiction of the court for this purpose.

12.3Entire Agreement.This Agreement and the Plan set forth the entire agreement and understanding of the parties hereto with respect to the grant, vesting and payment of this Award and the administration of the Plan and supersede all prior agreements, arrangements, plans and understandings relating to the grant, vesting and payment of this Award and the administration of the Plan.

12.4Amendment and Waiver.Other than as provided in the Plan, this Agreement may be amended, waived, modified or canceled only by a written instrument executed by the parties hereto or, in the case of a waiver, by the party waiving compliance.

12.5Captions.The Article, Section and paragraph captions in this Agreement are for convenience of reference only, do not constitute part of this Agreement and are not to be deemed to limit or otherwise affect any of the provisions of this Agreement.

12.6Electronic Delivery and Execution.The Grantee hereby consents and agrees to electronic delivery of any documents that the Company may elect to deliver (including, but not limited to, plan documents, prospectus and prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this and any other Incentive Award made or offered under the Plan. The Grantee understands that, unless revoked by giving written notice to the Company pursuant to the Plan, this consent will be effective for the duration of the Agreement. The Grantee also understands that the Grantee will have the right at any time to request that the Company deliver written copies of any and all materials referred to above. The Grantee hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may elect to deliver, and agrees that the Grantee's electronic signature is the same as, and will have the same force and effect as, the Grantee's manual signature. The Grantee consents and agrees that any such procedures and delivery may be effected by a third party engaged by the Company to provide administrative services related to the Plan.

12.7Address for Notice.All notices to the Company shall be in writing and sent to the Company's General Counsel at the Company's corporate headquarters. Notices to the Grantee shall be addressed to the Grantee at the address as from time to time reflected in the Company's or Subsidiary's employment records as the Grantee's address.

12.8Severability.In the event that any provision in this Agreement shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement.

12.9Appendix.Notwithstanding any provision of this Agreement to the contrary, this grant of Award Units and the shares of Common Stock acquired under the Plan shall be subject to any and all special terms and provisions, if any, as set forth in the Appendix for the Grantee's country of residence.

6

Exhibit A

The following provision will be applicable instead of the definition set forth in Section 2.13 of the Plan:

2.13"Good Reason" means, unless otherwise set forth in an agreement between the Company and the Participant, without the express written consent of the affected Participant, any of the following events involving the Company or Subsidiary that employs or receives services from the Participant:

(a)the assignment to the Participant of any duties inconsistent in any substantial respect with the Participant's position, authority or responsibilities as in effect during the 90-day period immediately preceding the Change in Control which assignment results in a substantial diminution in such position, authority or responsibilities or any other substantial adverse change in such position (including titles), authority or responsibilities, excluding an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company or applicable Subsidiary as set forth below;

(b)any failure by the Company or applicable Subsidiary to furnish the Participant with compensation and benefits at a level substantially equal to or exceeding those received by the Participant from the Company or applicable Subsidiary during the 90-day period preceding the Change in Control, other than (i) an insubstantial and inadvertent failure remedied by the Company or applicable Subsidiary as set forth below, (ii) a reduction in compensation which is applied to all non-union employees of the Company or applicable Subsidiary in the same dollar amount or percentage, or (iii) a reduction or modification of any employee benefit program covering substantially all of the employees of the Company or applicable Subsidiary, which reduction or modification generally applies to all employees covered under such program; or

(c)the Company or applicable Subsidiary requiring the Participant to be based or to perform services at any office or location that is in excess of 50 miles from the principal location of the Participant's work during the 90-day period immediately preceding the Change in Control, except for travel reasonably required in the performance of the Participant's responsibilities.

Before a termination by the Participant under this Section 2.13 will constitute termination for Good Reason, the Participant must give the Company a notice of termination within 30 calendar days of the occurrence of the event that constitutes Good Reason. The notice must set forth in reasonable detail the specific reason for the termination and the facts and circumstances claimed to provide a basis for termination of employment under the provision indicated. Failure to provide such notice within such 30-day period shall be conclusive proof that the Participant does not have Good Reason to terminate employment.

For purposes of this Section 2.13, Good Reason shall exist only if the Company or applicable Subsidiary fails to remedy the event or events constituting Good Reason within 30 calendar days after receipt of the notice of termination from the Participant. If the Participant determines Good Reason for termination exists and timely files a notice of termination, such determination shall be presumed to be true and the Company will have the burden of proving that Good Reason does not exist.

7

EX-10.4

Exhibit (10.4)

ECOLAB INC. (the "Company")
RESTRICTED STOCK UNIT AWARD AGREEMENT

ARTICLE 1.GRANT OF AWARD

The Company has adopted the Ecolab Inc. 2023 Stock Incentive Plan (the "Plan") to grant restricted Stock Unit Awards to certain employees of the Company and its Subsidiaries. The Company hereby grants to you (the "Grantee") on the date set forth in your grant notice (the "Date of Grant") a restricted Stock Unit Award (the "Award") consisting of the number of units set forth in the Grantee's grant notice (the "Award Units"), each of which is a bookkeeping entry representing the right to receive one share of the Company's common stock, par value $1.00 per share (the "Common Stock"). The Award and Award Units are subject to the terms, conditions, restrictions and risk of forfeiture set forth in this agreement (the "Agreement") and in the Plan.

ARTICLE 2.GRANT CONDITIONS AND RESTRICTIONS

2.1Vesting of Award Units. Subject to Sections 2.4 and 2.5 of this Agreement, restrictions on the Award Units will lapse and the Award Units will vest in the percentages and on the dates specified in the Grantee's grant notice, provided the Grantee remains in the continuous employ or service of the Company or any Subsidiary from the Date of Grant to the applicable vesting date. The period from the Date of Grant to the final vesting date specified in your grant notice is referred to in this Agreement as the "Restriction Period."

2.2Restrictions on Transferability. Any attempt to transfer, assign or encumber the Award Units other than in accordance with this Agreement and the Plan will be null and void, and will result in the immediate termination and forfeiture of the Award and all Award Units that have not yet vested.

2.3Dividends and Other Distributions. Subject to Article 4 of this Agreement, the Grantee will have no right to receive dividends, dividend equivalents or other distributions with respect to Award Units.

2.4Termination of Employment or Other Service. This Award is considered a Stock Unit Award subject only to service-based vesting conditions for purposes of Section 12 of the Plan. The effect of the termination of the Grantee's employment or other service with the Company and all Subsidiaries during the Restriction Period will be as provided in this Section and subject to Section 12.2 of the Plan which provides that in the event that the Grantee is determined to have committed any action which would constitute Cause, all rights of the Grantee under the Plan shall terminate and be forfeited without notice of any kind:

(a) Termination of Employment Due to Death or Disability. In the event a Grantee’s employment or other service with the Company and all Subsidiaries is terminated by reason of death or Disability, all unvested Award Units then held by the Grantee will become fully vested.

(b) Termination of Employment Due to Retirement. In the event a Grantee’s employment or other service with the Company and all Subsidiaries is terminated by reason of Retirement, all unvested Award Units then held by the Grantee will terminate and be forfeited.

(c) Termination of Employment for Reasons Other than Death, Disability or Retirement. In the event a Grantee’s employment or other service with the Company and all Subsidiaries is terminated for any reason other than death, Disability, Retirement, or other than a termination following a Change in Control (that is addressed in Section 2.5

below), or a Grantee is in the employ or service of a Subsidiary and the Subsidiary ceases to be a Subsidiary of the Company (unless the Grantee continues in the employ or service of the Company or another Subsidiary), all unvested Award Units then held by the Grantee will terminate and be forfeited.

2.5Change in Control. If a Change in Control occurs during the Restriction Period, the effect on the Award Units shall be as provided in Section 14.2 of the Plan, such that if within two years after the Change in Control a Grantee experiences an involuntary termination of employment or other service for reasons other than Cause, or terminates his or her employment or other service for Good Reason, as specifically defined in Exhibit A of this Agreement, then all unvested Award Units will become immediately fully vested and non-forfeitable. Such vested Award Units will be settled and paid to the Grantee as provided in Article 3.

ARTICLE 3.SETTLEMENT OF VESTED AWARD UNITS

Vested Award Units will be settled and paid to the Grantee no later than two and one-half months after the end of the Grantee's taxable year in which the applicable vesting date occurred with respect to the Award Units. Each vested Award Unit will be paid to the Grantee in one share of Common Stock, provided that the Company will have no obligation to issue shares of Common Stock pursuant to this Agreement unless and until the Grantee has satisfied any applicable tax obligations pursuant to Article 7 below and such issuance otherwise complies with all applicable law. Prior to the time the vested Award Units are settled, the Grantee will have no rights other than those of a general creditor of the Company. The Award Units represent an unfunded and unsecured obligation of the Company.

ARTICLE 4.ADJUSTMENTS

The number and kind of securities subject to this Award will be subject to adjustment under the circumstances and to the extent specified in Section 4.3 of the Plan.

ARTICLE 5.RIGHTS AS A STOCKHOLDER

The Grantee will have no rights as a stockholder with respect to any of the Award Units until the Award Units are settled following vesting and the Grantee becomes the holder of record of shares of Common Stock.

ARTICLE 6.EMPLOYMENT OR SERVICE

Nothing in this Agreement will be construed to (a) limit in any way the right of the Company to terminate the employment or service of the Grantee at any time, or (b) be evidence of any agreement or understanding, express or implied, that the Company will retain the Grantee in any particular position at any particular rate of compensation or for any particular period of time.

ARTICLE 7.WITHHOLDING TAXES

By accepting this Award, the Grantee (i) acknowledges his or her obligation to pay any federal, foreign, state and local withholding or employment-related taxes attributable to this Award as provided in Section 13 of the Plan, and (ii) consents and directs the Company or its third party administrator to withhold the number of shares of Common Stock issuable upon the vesting of some or all of the Award Units as the Company, in its sole discretion, deems necessary to satisfy such withholding obligations. For purposes of satisfying the Grantee's withholding and employment-related tax obligations, shares withheld by the Company will be valued at their Fair Market Value on the date of settlement.

2

ARTICLE 8.AUTHORIZATION TO RELEASE AND TRANSFER NECESSARY PERSONAL INFORMATION

The Grantee hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Grantee's personal data by and among, as applicable, the Company and its Subsidiaries for the exclusive purpose of implementing, administering and managing the Grantee's participation in the Plan. The Grantee understands that the Company may hold certain personal information about the Grantee, including, but not limited to, the Grantee's name, home address and telephone number, date of birth, social security number (or any other social or national identification number), salary, nationality, job title, number of Award Units and/or shares of Common Stock held and the details of all Award Units or any other entitlement to shares of Common Stock awarded, cancelled, vested, unvested or outstanding for the purpose of implementing, administering and managing the Grantee's participation in the Plan (the "Data"). The Grantee understands that the Data may be transferred to the Company or to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in the Grantee's country or elsewhere, and that any recipient's country (e.g., the United States) may have different data privacy laws and protections than the Grantee's country. The Grantee understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative or the Company's stock plan administrator. The Grantee authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing the Grantee's participation in the Plan, including any requisite transfer of such Data to a broker or other third party assisting with the administration of Award Units under the Plan or with whom shares of Common Stock acquired pursuant to the vesting of the Award Units or cash from the sale of such shares may be deposited. Furthermore, the Grantee acknowledges and understands that the transfer of the Data to the Company or to any third parties is necessary for the Grantee's participation in the Plan. The Grantee understands that the Grantee may, at any time, view the Data, request additional information about the storage and processing of the Data, require any necessary amendments to the Data or refuse or withdraw the consents herein by contacting the Grantee's local human resources representative or the Company's stock plan administrator in writing. The Grantee further acknowledges that withdrawal of consent may affect his or her ability to vest in or realize benefits from the Award Units, and the Grantee's ability to participate in the Plan. For more information on the consequences of refusal to consent or withdrawal of consent, the Grantee understands that he or she may contact his or her local human resources representative or the Company's stock plan administrator.

ARTICLE 9.SUBJECT TO PLAN

9.1Terms of Plan Prevail. The Award and the Award Units granted pursuant to this Agreement have been granted under, and are subject to the terms of, the Plan. The terms of the Plan are incorporated by reference in this Agreement in their entirety, and the Grantee acknowledges having received a copy of the Plan. The provisions of this Agreement will be interpreted as to be consistent with the Plan, and any ambiguities in this Agreement will be interpreted by reference to the Plan. In the event that any provision in this Agreement is inconsistent with the terms of the Plan, the terms of the Plan will prevail. References in this Agreement to specific Sections of the Plan refer to those Sections of the Plan as in effect on the Date of Grant.

9.2Definitions. Unless otherwise defined in this Agreement, the terms capitalized in this Agreement have the same meanings as given to such terms in the Plan, as in effect on the Date of Grant.

3

ARTICLE 10.MISCELLANEOUS

10.1Binding Effect. This Agreement will be binding upon the heirs, executors, administrators and successors of the parties hereto.

10.2Governing Law. This Agreement and all rights and obligations under this Agreement will be construed in accordance with the Plan and governed by the laws of the State of Minnesota without regard to conflicts of law provisions. Any legal proceeding related to this Agreement will be brought in an appropriate Minnesota court, and the parties to this Agreement consent to the exclusive jurisdiction of the court for this purpose.

10.3Entire Agreement. This Agreement and the Plan set forth the entire agreement and understanding of the parties hereto with respect to the grant, vesting and payment of this Award and the administration of the Plan and supersede all prior agreements, arrangements, plans and understandings relating to the grant, vesting and payment of this Award and the administration of the Plan.

10.4Amendment and Waiver. Other than as provided in the Plan, this Agreement may be amended, waived, modified or canceled only by a written instrument executed by the parties hereto or, in the case of a waiver, by the party waiving compliance.

10.5Captions. The Article, Section and paragraph captions in this Agreement are for convenience of reference only, do not constitute part of this Agreement and are not to be deemed to limit or otherwise affect any of the provisions of this Agreement.

10.6Electronic Delivery and Execution. The Grantee hereby consents and agrees to electronic delivery of any documents that the Company may elect to deliver (including, but not limited to, plan documents, prospectus and prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this and any other Incentive Award made or offered under the Plan. The Grantee understands that, unless revoked by giving written notice to the Company pursuant to the Plan, this consent will be effective for the duration of the Agreement. The Grantee also understands that the Grantee will have the right at any time to request that the Company deliver written copies of any and all materials referred to above. The Grantee hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may elect to deliver, and agrees that the Grantee's electronic signature is the same as, and will have the same force and effect as, the Grantee's manual signature. The Grantee consents and agrees that any such procedures and delivery may be effected by a third party engaged by the Company to provide administrative services related to the Plan.

10.7Address for Notice. All notices to the Company shall be in writing and sent to the Company's General Counsel at the Company's corporate headquarters. Notices to the Grantee shall be addressed to the Grantee at the address as from time to time reflected in the Company's or Subsidiary's employment records as the Grantee's address.

10.8Severability. In the event that any provision in this Agreement shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement.

10.9Appendix. Notwithstanding any provision of this Agreement to the contrary, this grant of Award Units and the shares of Common Stock acquired under the Plan shall be subject to any and all special terms and provisions, if any, as set forth in the Appendix for the Grantee's country of residence.

4

Exhibit A

The following provision will be applicable instead of the definition set forth in Section 2.13 of the Plan:

2.13“Good Reason” means, unless otherwise set forth in an agreement between the Company and the Participant, without the express written consent of the affected Participant, any of the following events involving the Company or Subsidiary that employs or receives services from the Participant:

(a)the assignment to the Participant of any duties inconsistent in any substantial respect with the Participant’s position, authority or responsibilities as in effect during the 90-day period immediately preceding the Change in Control which assignment results in a substantial diminution in such position, authority or responsibilities or any other substantial adverse change in such position (including titles), authority or responsibilities, excluding an isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company or applicable Subsidiary as set forth below;

(b)any failure by the Company or applicable Subsidiary to furnish the Participant with compensation and benefits at a level substantially equal to or exceeding those received by the Participant from the Company or applicable Subsidiary during the 90-day period preceding the Change in Control, other than (i) an insubstantial and inadvertent failure remedied by the Company or applicable Subsidiary as set forth below, (ii) a reduction in compensation which is applied to all non-union employees of the Company or applicable Subsidiary in the same dollar amount or percentage, or (iii) a reduction or modification of any employee benefit program covering substantially all of the employees of the Company or applicable Subsidiary, which reduction or modification generally applies to all employees covered under such program; or

(c)the Company or applicable Subsidiary requiring the Participant to be based or to perform services at any office or location that is in excess of 50 miles from the principal location of the Participant’s work during the 90-day period immediately preceding the Change in Control, except for travel reasonably required in the performance of the Participant’s responsibilities.

Before a termination by the Participant under this Section 2.13 will constitute termination for Good Reason, the Participant must give the Company a notice of termination within 30 calendar days of the occurrence of the event that constitutes Good Reason. The notice must set forth in reasonable detail the specific reason for the termination and the facts and circumstances claimed to provide a basis for termination of employment under the provision indicated. Failure to provide such notice within such 30-day period shall be conclusive proof that the Participant does not have Good Reason to terminate employment.

For purposes of this Section 2.13, Good Reason shall exist only if the Company or applicable Subsidiary fails to remedy the event or events constituting Good Reason within 30 calendar days after receipt of the notice of termination from the Participant. If the Participant determines Good Reason for termination exists and timely files a notice of termination, such determination shall be presumed to be true and the Company will have the burden of proving that Good Reason does not exist.

5

EX-15.1

Exhibit (15.1)

August 3, 2023

Securities and Exchange Commission

100 F Street, N.E.

Washington, DC 20549

Commissioners:

We are aware that our report dated August 3, 2023 on our review of interim financial statements of Ecolab Inc., which appears in this Quarterly Report on Form 10-Q, is incorporated by reference in the Registration Statements on Form S-8 (Registration Nos. 2-90702; 33-18202; 33-55986; 33-56101; 333-95043; 333-109890; 33-34000; 33-56151; 333-18627; 333-109891; 33-56125; 333-70835; 33-60266; 333-95041; 333-40239; 333-95037; 333-50969; 333-58360; 333-97927; 333-115567; 333-129427; 333-129428; 333-140988; 333-115568; 333-132139; 333-147148; 333-163837; 333-163838; 333-165130; 333-165132; 333-166646; 333-174028; 333-178300; 333-178302; 333-190317; 333-199730; 333-199732; 333-226534; 333-250090; 333-271653; and 333-271654) and Form S-3 (Registration No. 333-249740) of Ecolab Inc.

Very truly yours,

/s/ PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Minneapolis, Minnesota

EX-31.1

Exhibit (31.1)

CERTIFICATION

I, Christophe Beck, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2023 of Ecolab Inc.;

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(s) 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(s) 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: August 3, 2023

/s/ Christophe Beck

Christophe Beck

Chief Executive Officer

EX-31.2

Exhibit (31.2)

CERTIFICATION

I, Scott D. Kirkland, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2023 of Ecolab Inc.;

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(s) 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(s) 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: August 3, 2023

/s/ Scott D. Kirkland

Scott D. Kirkland

Chief Financial Officer

EX-32.1

Exhibit (32.1)

Section 1350 Certifications

Pursuant to 18 U.S.C. Section 1350, each of the undersigned officers of Ecolab Inc. does hereby certify that:

(a) the Quarterly Report on Form 10-Q of Ecolab Inc. for the quarter ended June 30, 2023 (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(b) information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Ecolab Inc.

Dated: August 3, 2023	/s/ Christophe Beck
	Christophe Beck
	Chief Executive Officer
Dated: August 3, 2023
	/s/ Scott D. Kirkland
	Scott D. Kirkland
	Chief Financial Officer

XML

Document and Entity Information	6 Months Ended
	Jun. 30, 2023 shares
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2023
Document Transition Report	false
Entity File Number	1-9328
Entity Registrant Name	ECOLAB INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	41-0231510
Entity Address, Address Line One	1 Ecolab Place
Entity Address, City or Town	St. Paul
Entity Address, State or Province	MN
Entity Address, Postal Zip Code	55102
City Area Code	800
Local Phone Number	232-6522
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	285,033,916
Entity Central Index Key	0000031462
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Amendment Flag	false
COMMON STOCK
Title of 12(b) Security	Common Stock, $1.00 par value
Trading Symbol	ECL
Security Exchange Name	NYSE
2.625% Euro Notes due 2025
Title of 12(b) Security	2.625% Euro Notes due 2025
Trading Symbol	ECL 25
Security Exchange Name	NYSE
1.000% Euro Notes due 2024
Title of 12(b) Security	1.000% Euro Notes due 2024
Trading Symbol	ECL 24
Security Exchange Name	NYSE

XML

CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Net sales	$ 3,852.1	$ 3,580.6	$ 7,423.7	$ 6,847.3
Cost of sales (including special charges (a))	2,334.8	2,211.1	4,540.0	4,284.5
Selling, general and administrative expenses	1,011.6	940.1	2,001.9	1,854.8
Special (gains) and charges	21.0	3.6	45.5	27.7
Operating income	484.7	425.8	836.3	680.3
Other (income) expense	(14.4)	(19.5)	(27.5)	(38.3)
Interest expense, net	77.8	56.0	152.0	109.0
Income before income taxes	421.3	389.3	711.8	609.6
Provision for income taxes	86.6	76.6	139.0	122.2
Net income including noncontrolling interest	334.7	312.7	572.8	487.4
Net income attributable to noncontrolling interest	5.0	4.4	9.7	7.2
Net income attributable to Ecolab	$ 329.7	$ 308.3	$ 563.1	$ 480.2
Earnings attributable to Ecolab per common share
Basic (in dollars per share)	$ 1.16	$ 1.08	$ 1.98	$ 1.68
Diluted (in dollars per share)	$ 1.15	$ 1.08	$ 1.97	$ 1.67
Weighted-average common shares outstanding
Basic (in shares)	284.9	285.1	284.8	285.7
Diluted (in shares)	286.3	286.6	286.1	287.4
Product and equipment sales
Net sales	$ 3,104.8	$ 2,886.8	$ 5,981.1	$ 5,510.9
Cost of sales (including special charges (a))	1,895.3	1,799.0	3,693.6	3,494.6
Service and lease sales
Net sales	747.3	693.8	1,442.6	1,336.4
Cost of sales (including special charges (a))	$ 439.5	$ 412.1	$ 846.4	$ 789.9

XML

CONSOLIDATED STATEMENTS OF INCOME (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Special (gains) and charges	$ 21.0	$ 3.6	$ 45.5	$ 27.7
Cost of sales
Special (gains) and charges	8.1	1.7	11.3	54.6
Product and equipment, and service and lease | Cost of sales
Special (gains) and charges	$ 8.1	$ 1.7	$ 11.3	$ 54.6

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income including noncontrolling interest	$ 334.7	$ 312.7	$ 572.8	$ 487.4
Foreign currency translation adjustments
Foreign currency translation	3.0	(162.7)	14.1	(120.5)
(Loss) gain on net investment hedges	(23.8)	71.4	(40.5)	90.3
Total foreign currency translation adjustments	(20.8)	(91.3)	(26.4)	(30.2)
Derivatives and hedging instruments	(1.5)	6.1	(6.2)	1.5
Pension and postretirement benefits
Pension and postretirement benefits	(4.3)	28.0	(4.1)	41.7
Subtotal	(26.6)	(57.2)	(36.7)	13.0
Total comprehensive income, including noncontrolling interest	308.1	255.5	536.1	500.4
Comprehensive income attributable to noncontrolling interest	3.0	1.5	8.2	3.3
Comprehensive income attributable to Ecolab	$ 305.1	$ 254.0	$ 527.9	$ 497.1

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Current assets
Cash and cash equivalents	$ 554.2	$ 598.6
Accounts receivable, net	2,780.1	2,698.1
Inventories	1,646.2	1,792.8
Other current assets	456.0	404.7
Total current assets	5,436.5	5,494.2
Property, plant and equipment, net	3,326.5	3,293.4
Goodwill	8,101.3	8,012.7
Other intangible assets, net	3,603.6	3,680.7
Operating lease assets	446.8	448.2
Other assets	541.5	535.1
Total assets	21,456.2	21,464.3
Current liabilities
Short-term debt	1,121.9	505.1
Accounts payable	1,476.8	1,728.2
Compensation and benefits	469.1	493.6
Income taxes	117.3	197.6
Other current liabilities	1,282.4	1,285.9
Total current liabilities	4,467.5	4,210.4
Long-term debt	7,499.6	8,075.3
Pension and postretirement benefits	660.8	670.3
Deferred income taxes	474.1	505.6
Operating lease liabilities	335.4	337.8
Other liabilities	438.3	406.3
Total liabilities	13,875.7	14,205.7
Commitments and contingencies (Note 16)
Equity (a)
Common stock	365.3	364.7
Additional paid-in capital	6,684.1	6,580.2
Retained earnings	9,580.0	9,318.8
Accumulated other comprehensive loss	(1,761.8)	(1,726.6)
Treasury stock	(7,310.9)	(7,301.0)
Total Ecolab shareholders' equity	7,556.7	7,236.1
Noncontrolling interest	23.8	22.5
Total equity	7,580.5	7,258.6
Total liabilities and equity	$ 21,456.2	$ 21,464.3

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Millions	Jun. 30, 2023	Dec. 31, 2022
CONSOLIDATED BALANCE SHEETS
Common stock, shares authorized	800.0	800.0
Common stock, par value per share (in dollars per share)	$ 1.00	$ 1.00
Common stock, shares outstanding	285.0	284.5

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
OPERATING ACTIVITIES
Net income including noncontrolling interest	$ 572.8	$ 487.4
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation	311.3	311.2
Amortization	152.4	158.2
Deferred income taxes	(36.8)	(57.6)
Share-based compensation expense	58.7	52.8
Pension and postretirement plan contributions	(29.0)	(35.1)
Pension and postretirement plan expense (income), net	4.3	(2.7)
Restructuring charges, net of cash paid	(26.3)	(13.4)
Other, net	13.2	10.1
Changes in operating assets and liabilities, net of effect of acquisitions:
Accounts receivable	(52.8)	(234.0)
Inventories	150.9	(250.8)
Other assets	19.2	(43.2)
Accounts payable	(264.7)	163.8
Other liabilities	(101.6)	(54.2)
Cash provided by operating activities	771.6	492.5
INVESTING ACTIVITIES
Capital expenditures	(345.7)	(317.5)
Property and other assets sold	8.6	0.7
Acquisitions and investments in affiliates, net of cash acquired	(105.0)	(7.2)
Other, net	(21.4)	13.2
Cash used for investing activities	(463.5)	(310.8)
FINANCING ACTIVITIES
Net issuances of commercial paper and notes payable	1.7	208.0
Reacquired shares	(10.9)	(402.8)
Dividends paid	(308.6)	(300.1)
Exercise of employee stock options	50.6	12.7
Hedge settlements	(53.5)	55.4
Other, net	(1.5)	(1.4)
Cash used for financing activities	(322.2)	(428.2)
Effect of exchange rate changes on cash and cash equivalents	(30.3)	11.5
Decrease in cash and cash equivalents	(44.4)	(235.0)
Cash and cash equivalents, beginning of period	598.6	359.9
Cash and cash equivalents, end of period	$ 554.2	$ 124.9

XML

CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Millions, $ in Millions	TOTAL ECOLAB SHAREHOLDERS' EQUITY	COMMON STOCK	ADDITIONAL PAID-IN CAPITAL	RETAINED EARNINGS	ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)	TREASURY STOCK	NON-CONTROLLING INTEREST	Total
Balance at Dec. 31, 2021	$ 7,224.2	$ 364.1	$ 6,464.6	$ 8,814.5	$ (1,634.8)	$ (6,784.2)	$ 28.9	$ 7,253.1
Increase (Decrease) in Stockholders' Equity
Net income	480.2			480.2			7.2	487.4
Other comprehensive income (loss) activity	16.9				16.9		(3.9)	13.0
Cash dividends declared (a)	(291.4)			(291.4)			(7.8)	(299.2)
Fair value adjustment of prior acquisition							0.6	0.6
Stock options and awards	66.3	0.4	65.2			0.7		66.3
Reacquired shares	(402.8)					(402.8)		(402.8)
Balance at Jun. 30, 2022	7,093.4	364.5	6,529.8	9,003.3	(1,617.9)	(7,186.3)	25.0	7,118.4
Balance at Mar. 31, 2022	7,081.6	364.5	6,501.5	8,840.4	(1,563.6)	(7,061.2)	23.5	7,105.1
Increase (Decrease) in Stockholders' Equity
Net income	308.3			308.3			4.4	312.7
Other comprehensive income (loss) activity	(54.3)				(54.3)		(2.9)	(57.2)
Cash dividends declared (a)	(145.4)			(145.4)				(145.4)
Stock options and awards	28.9		28.3			0.6		28.9
Reacquired shares	(125.7)					(125.7)		(125.7)
Balance at Jun. 30, 2022	7,093.4	364.5	6,529.8	9,003.3	(1,617.9)	(7,186.3)	25.0	7,118.4
Balance at Dec. 31, 2022	7,236.1	364.7	6,580.2	9,318.8	(1,726.6)	(7,301.0)	22.5	$ 7,258.6
Balance (in shares) at Dec. 31, 2022								284.5
Increase (Decrease) in Stockholders' Equity
Net income	563.1			563.1			9.7	$ 572.8
Other comprehensive income (loss) activity	(35.2)				(35.2)		(1.5)	(36.7)
Cash dividends declared (a)	(301.9)			(301.9)			(6.9)	(308.8)
Changes in noncontrolling interest	(4.5)		(4.5)					(4.5)
Stock options and awards	110.0	0.6	108.4			1.0		110.0
Reacquired shares	(10.9)					(10.9)		(10.9)
Balance at Jun. 30, 2023	7,556.7	365.3	6,684.1	9,580.0	(1,761.8)	(7,310.9)	23.8	$ 7,580.5
Balance (in shares) at Jun. 30, 2023								285.0
Balance at Mar. 31, 2023	7,344.2	365.0	6,626.5	9,401.3	(1,737.2)	(7,311.4)	20.8	$ 7,365.0
Increase (Decrease) in Stockholders' Equity
Net income	329.7			329.7			5.0	334.7
Other comprehensive income (loss) activity	(24.6)				(24.6)		(2.0)	(26.6)
Cash dividends declared (a)	(151.0)			(151.0)				(151.0)
Changes in noncontrolling interest	(4.5)		(4.5)					(4.5)
Stock options and awards	63.2	0.3	62.1			0.8		63.2
Reacquired shares	(0.3)					(0.3)		(0.3)
Balance at Jun. 30, 2023	$ 7,556.7	$ 365.3	$ 6,684.1	$ 9,580.0	$ (1,761.8)	$ (7,310.9)	$ 23.8	$ 7,580.5
Balance (in shares) at Jun. 30, 2023								285.0

XML

CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
CONSOLIDATED STATEMENTS OF EQUITY
Dividends declared per common share (in dollars per share)	$ 0.53	$ 0.51	$ 1.06	$ 1.02

XML

CONSOLIDATED FINANCIAL INFORMATION

6 Months Ended

Jun. 30, 2023

CONSOLIDATED FINANCIAL INFORMATION

CONSOLIDATED FINANCIAL INFORMATION

1. CONSOLIDATED FINANCIAL INFORMATION

The unaudited consolidated financial information for the second quarter ended June 30, 2023 and 2022 reflects, in the opinion of management, all adjustments necessary for a fair statement of the financial position, results of operations, comprehensive income, equity and cash flows of Ecolab Inc. ("Ecolab" or "the Company") for the interim periods presented. Any adjustments consist of normal recurring items.

The financial results for any interim period are not necessarily indicative of results for the full year. The consolidated balance sheet data as of December 31, 2022 was derived from the audited consolidated financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited consolidated financial information should be read in conjunction with the consolidated financial statements and notes thereto incorporated in the Company's Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (“SEC”) on February 24, 2023.

With respect to the unaudited financial information of the Company for the second quarter ended June 30, 2023 and 2022 included in this Form 10-Q, PricewaterhouseCoopers LLP reported that they have applied limited procedures in accordance with professional standards for a review of such information. Their separate report dated August 3, 2023 appearing herein states that they did not audit and they do not express an opinion on that unaudited financial information. Accordingly, the degree of reliance on their report on such information should be restricted in light of the limited nature of the review procedures applied. PricewaterhouseCoopers LLP is not subject to the liability provisions of Section 11 of the Securities Act of 1933, as amended (the "Act"), for their report on the unaudited financial information because that report is not a "report" or a "part" of a registration statement prepared or certified by PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11 of the Act.

XML

SPECIAL (GAINS) AND CHARGES

6 Months Ended

Jun. 30, 2023

SPECIAL (GAINS) AND CHARGES

SPECIAL (GAINS) AND CHARGES

2. SPECIAL (GAINS) AND CHARGES

Special (gains) and charges reported on the Consolidated Statements of Income include the following:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Cost of sales
Restructuring activities		$8.1		$0.8		$11.3		$3.4
Acquisition and integration activities		-		0.9		-		28.5
Russia/Ukraine		-		-		-		6.4
Other		-		-		-		16.3
Cost of sales subtotal		8.1		1.7		11.3		54.6
Special (gains) and charges
Restructuring activities		13.7		0.3		26.3		1.1
Acquisition and integration activities		3.5		3.4		8.5		10.9
Russia/Ukraine		0.3		(5.7)		0.6		5.9
Other		3.5		5.6		10.1		9.8
Special (gains) and charges subtotal		21.0		3.6		45.5		27.7
Total special (gains) and charges		$29.1		$5.3		$56.8		$82.3

For segment reporting purposes, special (gains) and charges are not allocated to reportable segments, which is consistent with the Company’s internal management reporting.

Restructuring activities

Restructuring activities are primarily related to the Combined Program which is described below. These activities have been included as a component of cost of sales and special (gains) and charges on the Consolidated Statements of Income. Restructuring liabilities have been classified as a component of other current and other noncurrent liabilities on the Consolidated Balance Sheets.

Combined Program

In November 2022 the Company approved a Europe cost savings program. In connection with these actions, the Company expected to incur pre-tax charges of $130 million ($110 million after tax). In February 2023, the Company expanded its previously announced Europe cost savings program to focus on its Institutional and Healthcare businesses in other regions. In connection with the expanded program (“Combined Program”), the Company expects to incur total pre-tax charges of $195 million ($150 million after tax). The Company expects that these restructuring charges will be completed by 2024. Program actions include headcount reductions from terminations, not filling

certain open positions, and facility closures. The Combined Program charges are expected to be primarily cash expenditures related to severance and asset disposals.

In anticipation of this Combined Program, a limited number of actions were taken in the fourth quarter of 2022. As a result, the Company reclassified $19.3 million ($14.5 million after tax) from other restructuring to the Combined Program in the first quarter of 2023.

During the second quarter and first six months of 2023 the Company recorded total Combined Program restructuring charges of $19.7 million ($16.2 million after tax) and $33.1 million ($26.4 million after tax), respectively, primarily related to severance. The net liability related to the Combined Program was $57.2 million and $62.0 million as of June 30, 2023 and December 31, 2022, respectively. The remaining liability is expected to be paid over a period of a few months to several quarters and will continue to be funded from operating activities.

Restructuring activity related to the Combined Program since inception of the underlying actions includes the following items:

	Employee		Asset
(millions)	Costs		Disposals		Total
2022 Activity
Recorded expense and accrual		$67.2		$-		$67.2
Net cash payments		(5.2)		-		(5.2)
Net restructuring liability, December 31, 2022		62.0		-		62.0
2023 Activity
Recorded expense and accrual		27.0		6.1		33.1
Net cash payments		(51.1)		-		(51.1)
Non-cash charges		-		(6.1)		(6.1)
Reclassification		19.3		-		19.3
Net restructuring liability, June 30, 2023		$57.2		$-		$57.2

Institutional Advancement Program

The Company approved a restructuring plan in 2020 focused on the Institutional business (“the Institutional Plan”) which is intended to enhance the Company’s Institutional sales and service structure and allow the sales team to capture share and penetration while maximizing service effectiveness by leveraging the Company’s ongoing investments in digital technology. In February 2021, the Company expanded the Institutional Plan, and expect that these restructuring charges will be completed by 2023, with total anticipated costs of $70 million ($55 million after tax). The remaining costs are expected to be primarily non-cash costs related to equipment disposals. Actual costs may vary from these estimates depending on actions taken.

During the second quarter of 2023 and 2022, the Company recorded restructuring charges of $2.1 million ($1.6 million after tax) and $0.7 million ($0.6 million after tax), respectively, and $4.5 million ($3.4 million after tax) and $2.1 million ($1.6 million after tax) in the first six months of 2023 and 2022, respectively, primarily related to disposals of equipment. The Company has recorded $58.6 million ($44.8 million after tax) of cumulative restructuring charges under the Institutional Plan. Net cash payments were $0.7 million and non-cash net charges were $1.6 million for the second quarter of 2023. Net cash payments were $3.1 million and non-cash net charges were $3.3 million for the first six months of 2023.The liability related to the Institutional Plan was $0 million and $1.9 million as of June 30, 2023 and December 31, 2022, respectively.

Accelerate 2020

During 2018, the Company formally commenced a restructuring plan Accelerate 2020 (“the A2020 Plan”), to leverage technology and system investments and organizational changes. The goals of the Plan were to further simplify and automate processes and tasks, reduce complexity and management layers, consolidate facilities and focus on key long-term growth areas by further leveraging technology and structural improvements. The restructuring activities were completed at the end of 2022, with total costs of $254.4 million ($198.4 million after tax).

Net cash payments were $5.4 million and $9.5 million for the second quarter and first six months of 2023, respectively. The liability related to the Plan was $8.6 million and $18.1 million as of the June 30, 2023 and December 31, 2022, respectively. The remaining liability is expected to be paid over a period of several quarters and will continue to be funded from operating activities.

Other Restructuring Activities

During the second quarter and first six months of 2022, the Company recorded restructuring charges of $0.3 million ($0.2 million after tax) and $2.0 million ($1.5 million after tax), respectively, related to other immaterial restructuring activity. The charges are primarily related to severance and asset write-offs.

The restructuring liability balance for all other restructuring plans excluding Combined Program, the A2020 Plan and the Institutional Plan was $3.7 million and $23.2 million as of June 30, 2023 and December 31, 2022, respectively. The decrease in liability was driven primarily by the reclass of $19.3 million from other restructuring to the Combined Program in the first six months of 2023. Cash payments during the second quarter and first six months of 2023 related to all other restructuring plans excluding the Combined Program, the A2020 Plan and the Institutional Plan were $0 million and $0.2 million, respectively.

Acquisition and integration related costs

Acquisition and integration related costs reported in product and equipment cost of sales on the Consolidated Statements of Income in the second quarter and first six months of 2022 include $0.9 million ($0.6 million after tax) and $28.5 million ($21.6 million after tax) related primarily to the recognition of fair value step-up in the Purolite Corporation (“Purolite”) inventory.

Acquisition and integration related costs reported in special (gains) and charges on the Consolidated Statements of Income include $3.5 million ($2.7 million after tax) and $3.4 million ($2.4 million after tax) during the second quarter of 2023 and 2022, respectively and $8.5 million ($6.4 million after tax) and $10.9 million ($8.3 million after tax) during the first six months of 2023 and 2022, respectively. Charges are integration related costs primarily related to the Purolite acquisition.

Further information related to the Company’s acquisitions is included in Note 3.

Russia/Ukraine

In light of Russia’s invasion of Ukraine and the sanctions against Russia by the United States and other countries, the Company has made the determination that it will limit its Russian business to operations that are essential to life, providing minimal support for its healthcare, life sciences, food and beverage and certain water businesses. The Company recorded charges of $0.3 million ($0.2 million after tax) and $0.6 million ($0.5 million after tax) in the second quarter and first six months of 2023, respectively, and recorded recoveries of ($5.7) million (($5.7) million after tax) and charges of $12.3 million ($13.3 million after tax) in the second quarter and first six months of 2022, respectively, primarily related to recoverability risk of certain assets in both Russia and Ukraine.

Other operating activities

Other special charges of $3.5 million ($2.6 million after tax) and $10.1 million ($7.7 million after tax) recorded in the second quarter and first six months of 2023, respectively, relate primarily to certain legal charges, which are recorded in special (gains) and charges on the Consolidated Statements of Income.

Other special charges of $5.6 million ($4.4 million after tax) and $26.1 million ($19.7 million after tax) recorded in the second quarter and first six months of 2022, respectively relate primarily to COVID-19 related inventory charges and certain legal charges, which are recorded in product and equipment cost of sales and special (gains) and charges on the Consolidated Statements of Income.

XML

ACQUISITIONS

6 Months Ended

Jun. 30, 2023

ACQUISITIONS

ACQUISITIONS

3. ACQUISITIONS

Acquisitions

The Company makes business acquisitions that align with its strategic business objectives. The assets and liabilities of acquired businesses are recorded in the Consolidated Balance Sheets based on estimates of the fair value of assets acquired, liabilities assumed and noncontrolling interests acquired as of the acquisition date. Goodwill is recognized in the amount that the purchase consideration paid exceeds the fair value of the net assets acquired. Purchase consideration includes both cash paid and the fair value of noncash consideration exchanged, including stock and/or contingent consideration exchanged, and is reduced by the amount of cash or cash equivalents acquired.

In May 2023, the Company acquired Chemlink Laboratories LLC, a U.S.-based producer of small format cleaning solutions. The Company made two other immaterial acquisitions during the second quarter of 2023. All three acquisitions became part of the Global Institutional & Specialty reporting segment.

The purchase accounting for these acquisitions are preliminary and subject to change as the Company finalizes the valuation of intangible assets, income tax balances and working capital. The Company expects the goodwill arising from the acquisition of Chemlink Laboratories LLC to be tax deductible.

No acquisitions occurred during the first quarter of 2023 or first six months of 2022. The following table summarizes the acquisition date fair value of net assets acquired from the Company’s acquisitions during the second quarter of 2023:

	June 30
(millions)	2023
Net tangible assets (liabilities) acquired		$9.4
Identifiable intangible assets
Customer relationships		35.7
Other technology		21.6
Total intangible assets		57.3
Goodwill		38.7
Total aggregate purchase price		105.4
Acquisition-related liabilities and contingent consideration		(4.8)
Net cash paid for acquisitions, including acquisition-related
liabilities and contingent consideration		$100.6

During the first six months of 2022, the Company recorded purchase accounting adjustments associated with the finalization of the purchase accounting for its 2022 and 2021 acquisitions. As a result of these purchase accounting adjustments, the Company made $7.2 million of acquisition-related payments, acquisition related net liabilities increased by $7.1 million, definite-lived intangible assets decreased by $5.6 million, and goodwill increased by $19.9 million.

The weighted average useful life of identifiable intangible assets acquired during the first six months of 2023 was 12 years. No intangible assets were acquired during the first six months of 2022.

XML

BALANCE SHEETS INFORMATION

6 Months Ended

Jun. 30, 2023

BALANCE SHEETS INFORMATION

BALANCE SHEETS INFORMATION

4. BALANCE SHEETS INFORMATION

	June 30		December 31
(millions)	2023		2022
Accounts receivable, net
Accounts receivable		$2,929.9		$2,829.0
Allowance for expected credit losses and other accruals		(149.8)		(130.9)
Total		$2,780.1		$2,698.1
Inventories
Finished goods		$1,041.8		$1,122.7
Raw materials and parts		834.6		849.2
Inventories at FIFO cost		1,876.4		1,971.9
FIFO cost to LIFO cost difference		(230.2)		(179.1)
Total		$1,646.2		$1,792.8
Other current assets
Prepaid assets		$137.6		$123.9
Taxes receivable		215.3		184.1
Derivative assets		62.2		57.5
Other		40.9		39.2
Total		$456.0		$404.7
Property, plant and equipment, net
Land		$155.0		$161.3
Buildings and leasehold improvements		1,145.0		1,126.9
Machinery and equipment		2,037.3		1,966.3
Merchandising and customer equipment		2,709.2		2,635.5
Capitalized software		941.6		962.1
Construction in progress		357.4		403.8
		7,345.5		7,255.9
Accumulated depreciation		(4,019.0)		(3,962.5)
Total		$3,326.5		$3,293.4
Other intangible assets, net
Intangible assets not subject to amortization
Trade names		$1,230.0		$1,230.0
Intangible assets subject to amortization
Customer relationships		3,353.4		3,292.8
Patents		501.6		497.0
Trademarks		406.3		404.0
Other technologies		541.0		518.8
		4,802.3		4,712.6
Accumulated amortization
Customer relationships		(1,697.8)		(1,581.7)
Patents		(307.9)		(292.3)
Trademarks		(219.6)		(202.5)
Other technologies		(203.4)		(185.4)
		(2,428.7)		(2,261.9)
Net intangible assets subject to amortization		2,373.6		2,450.7
Total		$3,603.6		$3,680.7
Other assets
Deferred income taxes		$110.2		$108.1
Pension		129.6		118.4
Derivative asset		33.2		44.5
Other		268.5		264.1
Total		$541.5		$535.1

	June 30		December 31
(millions)	2023		2022
Other current liabilities
Discounts and rebates		$392.9		$357.8
Dividends payable		151.0		150.8
Interest payable		75.3		58.7
Taxes payable, other than income		167.8		162.9
Derivative liability		0.4		21.9
Restructuring		73.7		100.6
Contract liability		107.4		116.5
Operating lease liabilities		110.1		108.3
Other		203.8		208.4
Total		$1,282.4		$1,285.9
Accumulated other comprehensive income (loss)
Unrealized (loss) gain on derivative financial instruments, net of tax		($2.5)		$3.7
Unrecognized pension and postretirement benefit expense, net of tax		(471.5)		(467.4)
Cumulative translation, net of tax		(1,287.8)		(1,262.9)
Total		($1,761.8)		($1,726.6)

XML

DEBT AND INTEREST

6 Months Ended

Jun. 30, 2023

DEBT AND INTEREST

DEBT AND INTEREST

5. DEBT AND INTEREST

Short-term Debt

The following table provides the components of the Company’s short-term debt obligations as of June 30, 2023 and December 31, 2022.

	June 30		December 31
(millions)	2023		2022
Short-term debt
Commercial paper		$-		$-
Notes payable		5.4		3.7
Long-term debt, current maturities		1,116.5		501.4
Total		$1,121.9		$505.1

Lines of Credit

As of June 30, 2023, the Company has a $2.0 billion multi-year revolving credit facility which expires in April 2026. The credit facility has been established with a diverse syndicate of banks and supports the Company’s U.S. and Euro commercial paper programs. There were no borrowings under the Company’s credit facility as of either June 30, 2023 or December 31, 2022.

Commercial Paper

The Company’s commercial paper program is used as a potential source of liquidity and consists of a $2.0 billion U.S. commercial paper program and a $2.0 billion Euro commercial paper program. The maximum aggregate amount of commercial paper that may be issued by the Company under its commercial paper programs may not exceed $2.0 billion.

The Company had no outstanding commercial paper under its U.S. and Euro commercial paper programs as of June 30, 2023 and as of December 31, 2022.

Notes Payable

The Company’s notes payable consists of uncommitted credit lines with major international banks and financial institutions, primarily to support global cash pooling structures. As of June 30, 2023 and December 31, 2022, the Company had $5.4 million and $3.7 million, respectively, outstanding under these credit lines.

Long-term Debt

The following table provides the components of the Company’s long-term debt obligations, including current maturities, as of June 30, 2023 and December 31, 2022.

	Maturity	June 30		December 31
(millions)	by Year	2023		2022
Long-term debt
Public notes (2023 principal amount)
Two year 2021 senior notes ($500 million)	2023		$499.4		$498.7
Seven year 2016 senior notes (€575 million)	2024		614.0		596.9
Ten year 2015 senior notes (€575 million)	2025		613.3		596.7
Ten year 2016 senior notes ($750 million)	2026		721.3		721.1
Ten year 2017 senior notes ($500 million)	2027		434.5		433.9
Six Year 2021 senior notes ($500 million)	2027		496.9		496.5
Five Year 2022 senior notes ($500 million)	2028		493.4		492.7
Ten year 2020 senior notes ($698 million)	2030		652.8		653.5
Ten year 2020 senior notes ($600 million)	2031		555.7		555.2
Eleven year 2021 senior notes ($650 million)	2032		644.9		644.6
Thirty year 2011 senior notes ($389 million)	2041		384.6		384.5
Thirty year 2016 senior notes ($200 million)	2046		197.3		197.3
Thirty year 2017 senior notes ($484 million)	2047		426.1		425.5
Thirty year 2020 senior notes ($500 million)	2050		490.9		490.7
Thirty year 2021 senior notes ($850 million)	2051		839.1		838.9
Thirty-four year 2021 senior notes ($685 million)	2055		538.2		537.2
Finance lease obligations and other			13.7		12.8
Total debt			8,616.1		8,576.7
Long-term debt, current maturities			(1,116.5)		(501.4)
Total long-term debt			$7,499.6		$8,075.3

Public Notes

The Company’s public notes may be redeemed by the Company at its option at redemption prices that include accrued and unpaid interest and a make-whole premium. Upon the occurrence of a change of control accompanied by a downgrade of the public notes below investment grade rating, within a specified time period, the Company would be required to offer to repurchase the public notes at a price equal to 101% of the aggregate principal amount thereof, plus any accrued and unpaid interest to the date of repurchase. The public notes are senior unsecured and unsubordinated obligations of the Company and rank equally with all other senior and unsubordinated indebtedness of the Company.

Covenants

The Company is in compliance with all covenants under the Company’s outstanding indebtedness as of June 30, 2023.

Net Interest Expense

Interest expense and interest income recognized during the second quarter and first six months of 2023 and 2022 were as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Interest expense		$82.7		$57.3		$162.8		$112.4
Interest income		(4.9)		(1.3)		(10.8)		(3.4)
Interest expense, net		$77.8		$56.0		$152.0		$109.0

Interest expense generally includes the expense associated with the interest on the Company’s outstanding borrowings, including the impact of the Company’s interest rate swap agreements. Interest expense also includes the amortization of debt issuance costs and debt discounts, which are both recognized over the term of the related debt.

XML

GOODWILL AND OTHER INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2023

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

6. GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

Goodwill arises from the Company’s acquisitions and represents the excess of the fair value of the purchase consideration exchanged over the fair value of net assets acquired. The Company’s reporting units are its ten operating segments. The Company assesses goodwill for impairment on an annual basis during the second quarter. If circumstances change or events occur that demonstrate it is more likely than not that the carrying amount of a reporting unit exceeds its fair value, the Company completes an interim goodwill assessment of that reporting unit prior to the next annual assessment. If the results of an annual or interim goodwill assessment demonstrate the carrying amount of a reporting unit is greater than its fair value, the Company will recognize an impairment loss for the amount by which the reporting unit’s carrying amount exceeds its fair value, but not to exceed the carrying amount of goodwill assigned to that reporting unit.

During the second quarter of 2023, the Company completed its annual goodwill impairment assessment for its reporting units using discounted cash flow analyses that incorporated assumptions regarding future growth rates, terminal values and discount rates. The Company’s goodwill impairment assessments for 2023 indicated the estimated fair values of each of these ten reporting units exceeded the carrying amounts of the respective reporting unit by a significant margin. There has been no impairment of goodwill in any of the periods presented.

The changes in the carrying amount of goodwill for each of the Company's reportable segments during the second quarter ended June 30, 2023 were as follows:

			Global		Global
	Global		Institutional		Healthcare &
(millions)	Industrial		& Specialty		Life Sciences		Other		Total
December 31, 2022		4,081.8		567.6		3,125.4		237.9		8,012.7
Current year business combinations		-		38.7		-		-		38.7
Effect of foreign currency translation		16.6		2.7		29.6		1.0		49.9
June 30, 2023		$4,098.4		$609.0		$3,155.0		$238.9		$8,101.3

Other Intangible Assets

The Nalco trade name is the Company’s only indefinite life intangible asset, which is tested for impairment on an annual basis during the second quarter. During the second quarter of 2023, the Company completed its annual impairment assessment of the Nalco trade name using the relief from royalty discounted cash flow method, which incorporates assumptions regarding future sales projections, royalty rates and discount rates. The Company’s Nalco tradename impairment assessment for 2023 indicated the estimated fair value of the Nalco trade name exceeded its $1.2 billion carrying amount by a significant margin. There has been no impairment of the Nalco trade name intangible since it was acquired.

The Company’s intangible assets subject to amortization include customer relationships, trademarks, patents and other technologies primarily acquired through business acquisitions. The fair value of intangible assets acquired in business acquisitions are estimated primarily using discounted cash flow valuation methods at the time of acquisition. Intangible assets are amortized on a straight-line basis over their estimated lives. Total amortization expense related to intangible assets during the second quarter of 2023 and 2022 was $76.8 million and $78.7 million, respectively, and during the first six months of 2023 and 2022 was $152.4 million and $158.2 million, respectively. Amortization expense related to intangible assets for the remaining six-month period of 2023 is expected to be approximately $151 million.

XML

FAIR VALUE MEASUREMENTS

6 Months Ended

Jun. 30, 2023

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

7. FAIR VALUE MEASUREMENTS

The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, contingent consideration obligations, commercial paper, notes payable, foreign currency forward contracts, interest rate swap agreements, cross-currency swap derivative contracts and long-term debt.

Fair value is defined as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. A hierarchy has been established for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring the most observable inputs be used when available. The hierarchy is broken down into three levels:

Level 1 - Inputs are quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2 - Inputs include observable inputs other than quoted prices in active markets.

Level 3 - Inputs are unobservable inputs for which there is little or no market data available.

The carrying amount and the estimated fair value for assets and liabilities measured on a recurring basis were:

	June 30, 2023
(millions)	Carrying		Fair Value Measurements
	Amount		Level 1		Level 2		Level 3
Assets
Foreign currency forward contracts		$85.3		$-		$85.3		$-
Cross-currency swap derivative contracts		42.7		-		42.7		-
Liabilities
Foreign currency forward contracts		23.5		-		23.5		-
Interest rate swap agreements		182.6		-		182.6		-
Cross-currency swap derivative contracts		19.6		-		19.6		-

	December 31, 2022
(millions)	Carrying		Fair Value Measurements
	Amount		Level 1		Level 2		Level 3
Assets
Foreign currency forward contracts		$118.9		$-		$118.9		$-
Cross-currency swap derivative contracts		58.7		-		58.7		-
Liabilities
Foreign currency forward contracts		83.3		-		83.3		-
Interest rate swap agreements		181.4		-		181.4		-
Cross-currency swap derivative contracts		14.5		-		14.5		-

The carrying value of foreign currency forward contracts is at fair value, which are determined based on foreign currency exchange rates as of the balance sheet date and are classified within Level 2. The carrying value of interest rate swap agreements are at fair value, which are determined based on current forward interest rates as of the balance sheet date and are classified within Level 2. The cross-currency swap derivative contracts are used to partially hedge the Company’s net investments in foreign operations against adverse movements in exchange rates between the U.S. dollar and the Euro. The carrying value of the cross-currency swap derivative contracts are at fair value, which are determined based on the income approach with the relevant interest rates and foreign currency current exchange rates and forward curves as inputs as of the balance sheet date and are classified within Level 2. For purposes of fair value disclosure above, derivative values are presented gross. Further discussion of gross versus net presentation of the Company's derivatives is included within Note 8.

Contingent consideration obligations are recognized and measured at fair value at the acquisition date and thereafter until settlement or expiration. Contingent consideration is classified within Level 3 as the underlying fair value is determined using income-based valuation approaches appropriate for the terms and conditions of each respective contingent consideration. The consideration expected to be transferred is based on the Company’s expectations of various financial measures. The ultimate payment of contingent consideration could deviate from current estimates based on the actual results of these financial measures. Contingent consideration was not material to the Company’s consolidated financial statements.

The carrying values of accounts receivable, accounts payable, cash and cash equivalents, commercial paper and notes payable approximate fair value because of their short maturities and as such are classified within Level 1.

The fair value of long-term debt is based on quoted market prices for the same or similar debt instruments (classified as Level 2). The carrying amount, which includes adjustments related to the impact of interest rate swap agreements, premiums and discounts, and deferred debt issuance costs, and the estimated fair value of long-term debt, including current maturities, held by the Company were:

	June 30, 2023				December 31, 2022
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Long-term debt, including current maturities		$8,616.1		$7,806.2		$8,576.7		$7,643.6

XML

DERIVATIVES AND HEDGING TRANSACTIONS

6 Months Ended

Jun. 30, 2023

DERIVATIVES AND HEDGING TRANSACTIONS

DERIVATIVES AND HEDGING TRANSACTIONS

8. DERIVATIVES AND HEDGING TRANSACTIONS

The Company uses foreign currency forward contracts, interest rate swap agreements, cross-currency swap derivative contracts and foreign currency debt to manage risks associated with foreign currency exchange rates, interest rates and net investments in foreign operations. The Company does not hold derivative financial instruments of a speculative nature or for trading purposes. The Company records derivatives as assets and liabilities in the Consolidated Balance Sheets at fair value. Changes in fair value are recognized immediately in earnings unless the derivative qualifies and is designated as a hedge. Cash flows from derivatives are classified in the statement of cash flows in the same category as the cash flows from the items subject to designated hedge or undesignated (economic) hedge relationships. The Company evaluates hedge effectiveness at inception and on an ongoing basis. If a derivative is no longer expected to be effective, hedge accounting is discontinued.

The Company is exposed to credit risk in the event of nonperformance of counterparties for foreign currency forward exchange contracts and interest rate swap agreements. The Company monitors its exposure to credit risk by using credit approvals and credit limits and by selecting major global banks and financial institutions as counterparties. The Company does not anticipate nonperformance by any of these counterparties, and therefore, recording a valuation allowance against the Company’s derivative balance is not considered necessary.

Derivative Positions Summary

Certain of the Company’s derivative transactions are subject to master netting arrangements that allow the Company to net settle contracts with the same counterparties. These arrangements generally do not call for collateral and as of the applicable dates presented in the following table, no cash collateral had been received or pledged related to the underlying derivatives.

The respective net amounts are included in other current assets, other assets, other current liabilities and other liabilities on the Consolidated Balance Sheets.

The following table summarizes the gross fair value and the net value of the Company’s outstanding derivatives:

	Derivative Assets				Derivative Liabilities
	June 30		December 31		June 30		December 31
(millions)	2023		2022		2023		2022
Derivatives designated as hedging instruments
Foreign currency forward contracts		$56.7		$78.6		$5.9		$9.2
Interest rate swap agreements		-		-		182.6		181.4
Cross-currency swap derivative contracts		42.7		58.7		19.6		14.5
Derivatives not designated as hedging instruments
Foreign currency forward contracts		28.6		40.3		17.6		74.1
Gross value of derivatives		128.0		177.6		225.7		279.2
Gross amounts offset in the Consolidated Balance Sheets		(32.6)		(75.6)		(32.6)		(75.6)
Net value of derivatives		$95.4		$102.0		$193.1		$203.6

The following table summarizes the notional values of the Company’s outstanding derivatives:

	Notional Values
		June 30	December 31
(millions)		2023	2022
Foreign currency forward contracts		$3,687		$5,745
Interest rate swap agreements		1,500		1,500
Cross-currency swap derivative contracts		682		650

Cash Flow Hedges

The Company utilizes foreign currency forward contracts to hedge the effect of foreign currency exchange rate fluctuations on forecasted foreign currency transactions, including inventory purchases and intercompany royalty, intercompany loans, management fee and other payments. These forward contracts are designated as cash flow hedges. The changes in fair value of these contracts are recorded in accumulated other comprehensive income (loss) (“AOCI”) until the hedged items affect earnings, at which time the gain or loss is reclassified into the same line item on the Consolidated Statements of Income as the underlying exposure being hedged. Cash flow hedged transactions impacting AOCI are forecasted to occur within the next year. For forward contracts designated as hedges of foreign currency exchange rate risk associated with forecasted foreign currency transactions, the Company excludes the changes in fair value attributable to time value from the assessment of hedge effectiveness. The initial value of the excluded component (i.e., the forward points) is amortized on a straight-line basis over the life of the hedging instrument and recognized in the same line item on the Consolidated Statements of Income as the underlying exposure being hedged for intercompany loans. For all other cash flow hedge types, the forward points are marked-to-market monthly and recognized in the same line item on the Consolidated Statements of Income as the underlying exposure being hedged. The difference between fair value changes of the excluded component and the amount amortized on the Consolidated Statements of Income is recorded in AOCI.

Fair Value Hedges

The Company manages interest expense using a mix of fixed and floating rate debt. To help manage exposure to interest rate movements and to reduce borrowing costs, the Company may enter into interest rate swap agreements under which the Company agrees to exchange, at specified intervals, the difference between fixed and floating interest amounts calculated by reference to an agreed upon notional principal amount. The mark-to-market of these fair value hedges is recorded as gains or losses in interest (income) expense and is offset by the gain or loss of the underlying debt instrument, which also is recorded in interest (income) expense. These fair value hedges are highly effective and thus, there is no impact on earnings due to hedge ineffectiveness.

In aggregate, the Company has entered into a series of interest rate swap agreements to convert $1.5 billion of its debt from a fixed interest rate to a floating interest rate. These interest rate swap agreements are designated as fair value hedges.

The following amounts were recorded in the Consolidated Balance Sheets related to cumulative basis adjustments for fair value hedges:

	Carrying amount of the hedged liabilities				Cumulative amount of the fair value hedging adjustment included in the carrying amount of the hedged liabilities
	Second Quarter Ended				Second Quarter Ended
Line item in which the hedged item is included	June 30				June 30
(millions)	2023		2022		2023		2022
Long-term debt		$1,317.9		$1,376.4		($184.5)		($125.9)

Net Investment Hedges

The Company designates its outstanding €1,150 million ($1,229 million at the end of the second quarter of 2023) senior notes (“Euronotes”) and related accrued interest as hedges of its Euro denominated exposures from the Company’s investments in certain of its Euro denominated functional currency subsidiaries.

The Company entered into a series of cross-currency swap derivative contracts maturing in 2026 and 2030. The cross-currency swap derivative contracts are designated as net investment hedge of its Euro denominated exposures from the Company’s investments in certain of its Euro denominated functional currency subsidiaries. The cross-currency swap derivative contracts exchange fixed-rate payments in one currency for fixed-rate payments in another currency. As of June 30, 2023, the Company had €625 million ($682 million) cross-currency swap derivative contracts outstanding as hedges of the Company’s net investment in foreign operations. The changes in the spot rate of these instruments are recorded in AOCI in stockholders’ equity, partially offsetting the foreign currency translation adjustment of the Company’s related net investment that is also recorded in AOCI. Any ineffective portions of net investment hedges are reclassified from AOCI into earnings during the period of change. The interest income or expense from these swaps are recorded in interest expense on the accompanying Consolidated Statements of Income consistent with the classification of interest expense attributable to the underlying debt.

The revaluation gains and losses on the Euronotes and cross-currency swap derivative contracts, which are designated and effective as hedges of the Company’s net investments, have been included as a component of the cumulative translation adjustment account, and were as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Revaluation (loss) gain, net of tax:
Euronotes		($9.8)		$42.5		($24.9)		$52.8
Cross-currency swap derivative contracts		(14.0)		28.9		(15.6)		37.5
Total revaluation (loss) gain, net of tax		($23.8)		$71.4		($40.5)		$90.3

Derivatives Not Designated as Hedging Instruments

The Company also uses foreign currency forward contracts to offset its exposure to the change in value of certain foreign currency denominated assets and liabilities held at foreign subsidiaries, primarily receivables and payables, which are remeasured at the end of each period. Although the contracts are effective economic hedges, they are not designated as accounting hedges. Therefore, changes in the value of these derivatives are recognized immediately in earnings, thereby offsetting the current earnings effect of the related foreign currency denominated assets and liabilities.

Effect of all Derivative Instruments on Income

The gain (loss) of all derivative instruments recognized in product and equipment cost of sales (“COS”), selling, general and administrative expenses (“SG&A”) and interest expense, net (“interest”) is summarized below:

	Second Quarter Ended
	June 30
	2023				2022
(millions)		COS	SG&A	Interest		COS	SG&A	Interest
Gain (loss) on derivatives in cash flow hedging relationship:
Foreign currency forward contracts
Amount of gain (loss) reclassified from AOCI to income		$2.8	($4.4)	$-		$0.8	$38.2	$-
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value		-	-	2.1		-	-	3.9
Interest rate swap agreements
Amount of (loss) gain reclassified from AOCI to income		-	-	(0.4)		-	-	(0.6)
(Loss) gain on derivatives not designated as hedging instruments:
Foreign currency forward contracts
Amount of (loss) gain recognized in income		-	(3.5)	-		-	34.2	-
Total gain (loss) of all derivative instruments		$2.8	($7.9)	$1.7		$0.8	$72.4	$3.3
	Six Months Ended
	June 30
	2023				2022
(millions)		COS	SG&A	Interest		COS	SG&A	Interest
Gain (loss) on derivatives in cash flow hedging relationship:
Foreign currency forward contracts
Amount of gain (loss) reclassified from AOCI to income		$8.1	($10.4)	$-		$0.8	$52.1	$-
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value		-	-	4.1		-	-	7.7
Interest rate swap agreements
Amount of (loss) gain reclassified from AOCI to income		-	-	(0.9)		-	-	(1.2)
(Loss) gain on derivatives not designated as hedging instruments:
Foreign currency forward contracts
Amount of (loss) gain recognized in income		-	(28.1)	-		-	48.4	-
Total gain (loss) of all derivative instruments		$8.1	($38.5)	$3.2		$0.8	$100.5	$6.5

XML

OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION

6 Months Ended

Jun. 30, 2023

OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION

OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION

9. OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION

Other comprehensive income (loss) includes net income, foreign currency translation adjustments, defined benefit pension and postretirement plan adjustments, gains and losses on derivative instruments designated and effective as cash flow hedges and non-derivative instruments designated and effective as foreign currency net investment hedges that are charged or credited to the accumulated other comprehensive loss account in shareholders’ equity. Refer to Note 8 for additional information related to the Company’s derivatives and hedging transactions. Refer to Note 13 for additional information related to the Company’s pension and postretirement benefits activity.

The following tables provide other comprehensive income information related to the Company’s derivatives and hedging instruments and pension and postretirement benefits:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Derivative and Hedging Instruments
Unrealized (loss) gain on derivative and hedging instruments
Amount recognized in AOCI		($1.6)		$49.7		($6.7)		$60.4
(Gain) loss reclassified from AOCI into income
COS		(2.8)		(0.8)		(8.1)		(0.8)
SG&A		4.4		(38.2)		10.4		(52.1)
Interest (income) expense, net		(1.7)		(3.3)		(3.2)		(6.5)
		(0.1)		(42.3)		(0.9)		(59.4)
Other activity		1.1		0.5		1.2		0.5
Tax impact		(0.9)		(1.8)		0.2		-
Net of tax		($1.5)		$6.1		($6.2)		$1.5
Pension and Postretirement Benefits
Amount reclassified from AOCI into income
Settlement charge		$-		$-		$0.6		$0.9
Amortization of net actuarial loss and prior period service credits, net		0.9		14.5		2.5		29.4
		0.9		14.5		3.1		30.3
Other activity		(4.5)		16.8		(6.1)		17.9
Tax impact		(0.7)		(3.3)		(1.1)		(6.5)
Net of tax		($4.3)		$28.0		($4.1)		$41.7

The following table summarizes the derivative and pension and postretirement benefit amounts reclassified from AOCI into income:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
	2023		2022		2023		2022
(millions)
Derivative (gain) loss reclassified from AOCI into income, net of tax		($0.1)		($31.9)		($0.7)		($44.8)
Pension and postretirement benefits amortization of net actuarial losses and prior period service credits and settlement charges reclassified from AOCI into income, net of tax		(4.3)		28.0		(4.1)		41.7

XML

SHAREHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2023

SHAREHOLDERS' EQUITY

SHAREHOLDERS' EQUITY

10. SHAREHOLDERS’ EQUITY

Share Repurchase Authorization

In February 2015 and November 2022, the Company’s Board of Directors authorized the repurchase of up to 20,000,000 and 10,000,000, respectively, additional shares of its common stock, including shares to be repurchased under Rule 10b5–1. As of June 30, 2023, 12,917,097 shares remained to be repurchased under the Company’s repurchase authorization. The Company intends to repurchase all shares under its authorization, for which no expiration date has been established, in open market or privately negotiated transactions, subject to market conditions.

Share Repurchases

During the first six months of 2023, the Company reacquired 68,712 shares of its common stock related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units.

During the first six months of 2022, the Company reacquired 2,284,094 shares of its common stock, of which 2,186,990 related to share repurchases through open market and 97,104 related to shares withheld for taxes on the exercise of stock options and the vesting of stock awards and units.

XML

EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS")

6 Months Ended

Jun. 30, 2023

EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS")

EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS")

11. EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE (“EPS”)

The difference in the weighted average common shares outstanding for calculating basic and diluted EPS is a result of the dilution associated with the Company’s equity compensation plans. As noted in the table below, certain stock options and units outstanding under these equity compensation plans were not included in the computation of diluted EPS because they would not have had a dilutive effect.

The computations of the basic and diluted EPS amounts were as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions, except per share)	2023		2022		2023		2022
Net income attributable to Ecolab		$329.7		$308.3		$563.1		$480.2
Weighted-average common shares outstanding
Basic		284.9		285.1		284.8		285.7
Effect of dilutive stock options and units		1.4		1.5		1.3		1.7
Diluted		286.3		286.6		286.1		287.4
Earnings attributable to Ecolab per common share
Basic EPS		$ 1.16		$ 1.08		$ 1.98		$ 1.68
Diluted EPS		$ 1.15		$ 1.08		$ 1.97		$ 1.67
Anti-dilutive securities excluded from the computation of diluted EPS		2.6		2.6		3.8		2.6
Amounts do not necessarily sum due to rounding.

XML

INCOME TAXES

6 Months Ended

Jun. 30, 2023

INCOME TAXES

INCOME TAXES

12. INCOME TAXES

The Company’s tax rate was 20.6% and 19.7% for the second quarter of 2023 and 2022, respectively, and 19.5% and 20.0% for the first six months of 2023 and 2022, respectively. The change in the Company’s tax rate for the second quarter and first six months of 2023 compared to the second quarter and first six months of 2022 was driven primarily by the impact of discrete tax items and special (gains) and charges. Further information related to special (gains) and charges is included in Note 2.

The Company recognized net tax expense related to discrete tax items of $2.8 million and a net tax benefit of $1.2 million in the second quarter and first six months of 2023, respectively. This included share-based compensation excess tax benefits of $1.8 million and $1.9 million in the second quarter and first six months of 2023, respectively. Additionally, the Company recognized discrete tax expense of $4.6 million and $0.7 million during the second quarter and first six months of 2023, respectively, primarily due to audit settlements, uncertain tax positions, prior year return adjustments, repricing of deferred tax balances, and other changes in estimates.

The Company recognized net tax expense related to discrete tax items of $3.7 million and $4.7 million in the second quarter and first six months of 2022, respectively. This included share-based compensation excess tax benefits of $0.7 million and $3.6 million in the second quarter and first six months of 2022, respectively. Additionally, the Company recognized discrete tax expense of $4.4 million and $8.3 million during the second quarter and first six months of 2022, respectively, primarily due to audit settlements, uncertain tax positions, prior year return adjustments, repricing of deferred tax balances, and other changes in estimates.

The Inflation Reduction Act (IRA), which became effective January 1, 2023, includes a corporate alternative minimum tax on certain large corporations and climate change mitigation incentives. In addition, there are other non-income tax provisions, including an excise tax on the repurchase of corporate stock. The Company continues to assess the impact of the IRA but does not anticipate any material impacts on the Company’s financial statements. 

XML

PENSION AND POSTRETIREMENT PLANS

6 Months Ended

Jun. 30, 2023

PENSION AND POSTRETIREMENT PLANS

PENSION AND POSTRETIREMENT PLANS

13. PENSION AND POSTRETIREMENT PLANS

The Company has a non-contributory, qualified, defined benefit pension plan covering the majority of its U.S. employees. The Company also has non-contributory, non-qualified, defined benefit pension plans, which provide for benefits to employees in excess of limits permitted under its U.S. pension plans. Various international subsidiaries also have defined benefit pension plans. The Company also provides postretirement health care and life insurance benefits to certain U.S. employees and retirees.

The components of net periodic pension and postretirement health care benefit expense for the second quarter ended June 30 are as follows:

	U.S.				International				U.S. Postretirement
	Pension				Pension				Health Care
(millions)	2023		2022		2023		2022		2023		2022
Service cost		$10.6		$10.5		$5.4		$6.9		$0.1		$0.2
Interest cost on benefit obligation		22.0		14.1		11.6		5.5		1.4		0.8
Expected return on plan assets		(36.3)		(36.7)		(14.0)		(17.6)		-		(0.1)
Recognition of net actuarial loss (gain)		-		10.0		3.3		5.8		(0.8)		(0.1)
Amortization of prior service benefit		(1.5)		(1.2)		(0.1)		-		-		-
Total expense (benefit)		($5.2)		($3.3)		$6.2		$0.6		$0.7		$0.8

The components of net periodic pension and postretirement health care benefit expense for the six months ended June 30 are as follows:

	U.S.				International				U.S. Postretirement
	Pension				Pension				Health Care
(millions)	2023		2022		2023		2022		2023		2022
Service cost		$20.8		$21.0		$10.8		$14.2		$0.2		$0.4
Interest cost on benefit obligation		44.0		28.2		23.0		11.2		2.8		1.6
Expected return on plan assets		(72.6)		(73.4)		(27.8)		(36.0)		-		(0.2)
Recognition of net actuarial loss (gain)		-		20.0		6.8		11.8		(1.6)		(0.2)
Amortization of prior service benefit		(2.5)		(2.2)		(0.2)		-		-		-
Curtailments and settlements		0.7		0.9		-		-		(0.1)		-
Total expense (benefit)		($9.6)		($5.5)		$12.6		$1.2		$1.3		$1.6

Service cost is included as employee compensation cost in either cost of sales or selling, general and administrative expenses on the Consolidated Statements of Income based on employee roles, while non-service components are included in other (income) expense in the Consolidated Statements of Income.

As of June 30, 2023, the Company is in compliance with all funding requirements of each of its defined benefit plans.

During the first six months of 2023, the Company made contributions of $4 million to its U.S. non-contributory non-qualified defined benefit plans and estimates it will contribute an additional $5 million to such plans during the remainder of 2023.

During the first six months of 2023, the Company made contributions of $20 million to its international pension plans and estimates it will contribute an additional $22 million to such plans during the remainder of 2023.

During the first six months of 2023, the Company made contributions of $5 million to its U.S. postretirement health care plans and estimates it will contribute an additional $6 million to such plans during the remainder of 2023.

XML

REVENUES

6 Months Ended

Jun. 30, 2023

REVENUES

REVENUES

14. REVENUES

Revenue Recognition

Product and Sold Equipment

Product revenue is generated from sales of cleaning, sanitizing, water treatment, process treatment and colloidal silica products. In addition, the Company sells equipment which may be used in combination with its specialized products. Revenue recognized from product and equipment sales is recognized at the point in time when the obligations in the contract with the customer are satisfied, which generally occurs with the transfer of the product or delivery of the equipment.

On June 3, 2020, the Company completed the separation of its Upstream Energy business (“ChampionX”). The Company entered into a Master Cross Supply and Product Transfer agreement with ChampionX to provide, receive or transfer certain products for a period up to 36 months and for a smaller set of products with limited suppliers over the next few years. Sales of product to ChampionX under this agreement are recorded in product and equipment sales in the Corporate segment along with the related cost of sales, while purchases from ChampionX are recorded in inventory. Sales of product to ChampionX post-separation for the second quarter of 2023 and 2022 were $16.7 million and $33.9 million, respectively, and for the first six months of 2023 and 2022 were $40.4 million and $68.6 million, respectively. As of June 30, 2023 and December 31, 2022, the Company had an outstanding accounts receivable balance for sales of product to ChampionX of $12.0 million and $12.9 million, respectively.

Service and Lease Equipment

Service and lease equipment revenue is generated from providing services or leasing equipment to customers. Service offerings include installing or repairing certain types of equipment, activities that supplement or replace headcount at the customer location, or fulfilling deliverables included in the contract. Global Industrial segment services are associated with water treatment and paper process applications. Global Institutional & Specialty segment services include cleaning and sanitizing programs and wash process solutions. Global Healthcare & Life Sciences segment services include pharmaceutical, personal care, infection and containment control solutions. Revenues included in Other primarily relate to services designed to detect, eliminate and prevent pests. Service revenue is recognized over time utilizing an input method and aligns with when the services are provided. Typically, revenue is recognized over time using costs incurred to date because the effort provided by the field selling and service organization represents services provided, which corresponds with the transfer of control. Revenue recognized from leased equipment primarily relates to warewashing and water treatment equipment recognized on a straight-line basis over the length of the lease contract pursuant to Topic 842 Leases.

The Company’s operating lease revenue was as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Operating lease revenue*		$128.7		$115.2		$255.1		$227.3

*Includes immaterial variable lease revenue

The following table shows principal activities, separated by reportable segments, from which the Company generates its revenue. Corporate segment includes sales to ChampionX under the Master Cross Supply and Product Transfer agreements entered into as part of the ChampionX Separation. For more information about the Company’s reportable segments, refer to Note 15.

Net sales at public exchange rates by reportable segment are as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Global Industrial
Product and sold equipment		$1,587.8		$1,471.4		$3,086.0		$2,829.8
Service and lease equipment		220.7		218.5		431.9		425.8
Global Institutional & Specialty
Product and sold equipment		1,047.2		936.3		1,968.0		1,763.3
Service and lease equipment		225.0		193.0		433.0		375.4
Global Healthcare & Life Sciences
Product and sold equipment		363.9		360.2		716.5		694.2
Service and lease equipment		26.9		30.7		54.0		59.5
Other
Product and sold equipment		89.2		85.0		170.2		155.0
Service and lease equipment		274.7		251.6		523.7		475.6
Corporate
Product and sold equipment		16.7		33.9		40.4		68.6
Service and lease equipment		-		-		-		0.1
Total
Total product and sold equipment		$3,104.8		$2,886.8		$5,981.1		$5,510.9
Total service and lease equipment		$747.3		$693.8		$1,442.6		$1,336.4

Net sales at public exchange rates by geographic region for the second quarter ended June 30 are as follows:

	Global				Global Institutional				Global Healthcare
	Industrial				& Specialty				& Life Sciences				Other				Corporate
	2023		2022		2023		2022		2023		2022		2023		2022		2023		2022
North America		$814.7		$776.6		$933.8		$828.1		$156.4		$157.6		$232.3		$214.9		$12.4		$30.3
Europe		382.4		341.3		174.7		164.3		186.1		180.7		74.1		69.7		1.3		0.9
Asia Pacific		222.2		209.0		58.4		53.0		22.6		24.4		23.0		19.6		0.8		1.1
Latin America		181.0		156.0		47.6		41.5		6.6		5.3		14.2		13.1		2.2		1.6
Greater China		101.0		106.5		40.5		28.7		12.9		17.0		18.0		16.7		-		-
India, Middle East and Africa		107.2		100.5		17.2		13.7		6.2		5.9		2.3		2.6		-		-
Total		$1,808.5		$1,689.9		$1,272.2		$1,129.3		$390.8		$390.9		$363.9		$336.6		$16.7		$33.9

Net sales at public exchange rates by geographic region for the six months ended June 30 are as follows:

	Global				Global Institutional				Global Healthcare
	Industrial				& Specialty				& Life Sciences				Other				Corporate
(millions)	2023		2022		2023		2022		2023		2022		2023		2022		2023		2022
North America		$1,605.4		$1,493.2		$1,767.7		$1,560.1		$320.3		$302.6		$442.6		$396.6		$33.1		$59.7
Europe		731.2		654.8		321.2		301.0		360.5		350.8		141.3		131.8		2.0		1.5
Asia Pacific		436.5		414.1		115.2		105.7		42.3		44.4		43.2		36.2		1.8		2.1
Latin America		338.2		292.4		88.9		78.3		12.3		11.2		27.8		26.1		3.5		5.1
Greater China		195.6		216.7		76.1		68.9		23.7		31.8		34.3		34.6		-		0.1
India, Middle East and Africa		211.0		184.4		31.9		24.7		11.4		12.9		4.7		5.3		-		0.2
Total		$3,517.9		$3,255.6		$2,401.0		$2,138.7		$770.5		$753.7		$693.9		$630.6		$40.4		$68.7

Net sales by geographic region were determined based on origin of sale. The United States made up 53% and 53% of total revenues during the six months ended June 30, 2023 and 2022, respectively.

Accounts Receivable and Allowance for Expected Credit Losses

Accounts receivable are carried at the invoiced amounts, less an allowance for expected credit losses, and generally do not bear interest. The Company’s allowance for expected credit losses estimates the amount of expected future credit losses by analyzing accounts receivable balances by age and applying historical write-off and collection experience. The Company’s estimates separately consider macroeconomic trends, specific circumstances and credit conditions of customer receivables. Account balances are written off against the allowance when it is determined the receivable will not be recovered.

The Company’s allowance for expected return of products shipped and credits related to pricing or quantities shipped was $66.0 million and $24.9 million as of June 30, 2023 and 2022, respectively. Returns and credit activity is recorded directly as a reduction to revenue.

The following table summarizes the activity in the allowance for expected credit losses:

	Six Months Ended
	June 30
(millions)	2023		2022
Beginning balance		$71.9		$52.8
Bad debt expense		32.5		24.8
Write-offs		(18.6)		(8.5)
Other (a)		(2.0)		3.8
Ending balance		$83.8		$72.9

(a) Other amounts are primarily the effects of changes in currency translations.

Contract Liability

Payments received from customers are based on invoices or billing schedules as established in contracts with customers. Accounts receivable are recorded when the right to consideration becomes unconditional. The contract liability relates to billings in advance of performance (primarily service obligations) under the contract. Contract liabilities are recognized as revenue when the performance obligation has been performed, which primarily occurs during the subsequent quarter.

The following table summarizes the contract liability activity:

	Six Months Ended
	June 30
(millions)	2023		2022
Contract liability as of beginning of the year		$116.5		$91.7
Revenue recognized in the period from:
Amounts included in the contract liability at the beginning of the year		(116.5)		(91.7)
Increases due to billings excluding amounts recognized as revenue during the period ended		107.4		99.1
Contract liability as of end of period		$107.4		$99.1

XML

OPERATING SEGMENTS

6 Months Ended

Jun. 30, 2023

OPERATING SEGMENTS

OPERATING SEGMENTS

15. OPERATING SEGMENTS

The Company’s organizational structure consists of global business unit and global regional leadership teams. The Company’s ten operating segments follow its commercial and product-based activities and are based on engagement in business activities, availability of discrete financial information and review of operating results by the Chief Operating Decision Maker at the identified operating segment level.

The Company’s operating segments that share similar economic characteristics and future prospects, nature of the products and production processes, end-use markets, channels of distribution and regulatory environment have been aggregated into three reportable segments: Global Industrial, Global Institutional & Specialty and Global Healthcare & Life Sciences. The Company’s operating segments that do not meet the quantitative criteria to be separately reported have been combined into Other. The Company provides similar information for Other as the Company considers the information regarding its underlying operating segments as useful in understanding its consolidated results.

Comparability of Reportable Segments

Effective January 1, 2023, the Company’s former Downstream operating segment is now part of the Water operating segment. This change did not have any impact on the Global Industrial reportable segment.

The Company evaluates the performance of its non-U.S. dollar functional currency international operations based on fixed currency exchange rates, which eliminates the impact of exchange rate fluctuations on its international operations. Fixed currency amounts are updated annually at the beginning of each year based on translation into U.S. dollars at foreign currency exchange rates established by management, with all periods presented using such rates. The “Fixed Currency Rate Change” column shown in the following table reflects international operations at fixed currency exchange rates established by management at the beginning of 2023, rather than the 2022 established rates. The difference between the fixed currency exchange rates and the actual currency exchange rates is reported within the “Effect of foreign currency translation” row in the following table. The “Other” column shown in the following table reflects immaterial changes between reportable segments, including the movement of certain customers and cost allocations.

The impact of the preceding changes on previously reported full year 2022 reportable segment net sales and operating income is summarized as follows:

	December 31, 2022
	2022 Reported					Fixed	2022 Reported
	Valued at 2022				Currency		Valued at 2023
(millions)	Management Rates		Other		Rate Change		Management Rates
Net Sales
Global Industrial		$6,944.0		$-		($207.7)		$6,736.3
Global Institutional & Specialty		4,480.0		10.2		(75.9)		4,414.3
Global Healthcare & Life Sciences		1,570.0		-		(64.2)		1,505.8
Other		1,355.0		(10.2)		(31.5)		1,313.3
Corporate		124.1		-		(0.4)		123.7
Subtotal at fixed currency rates		14,473.1		-		(379.7)		14,093.4
Effect of foreign currency translation		(285.3)				379.7		94.4
Consolidated reported GAAP net sales		$14,187.8		$-		$-		$14,187.8
Operating Income
Global Industrial		$977.0		$0.8		($42.0)		$935.8
Global Institutional & Specialty		634.5		(1.6)		(11.2)		621.7
Global Healthcare & Life Sciences		205.0		(1.8)		(9.9)		193.3
Other		212.8		2.6		(5.5)		209.9
Corporate		(416.7)		-		2.3		(414.4)
Subtotal at fixed currency rates		1,612.6		-		(66.3)		1,546.3
Effect of foreign currency translation		(50.1)				66.3		16.2
Consolidated reported GAAP operating income		$1,562.5		$-		$-		$1,562.5

Reportable Segment Information

Financial information for the Company’s reportable segments, is as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Net Sales
Global Industrial		$1,795.6		$1,653.3		$3,494.9		$3,164.7
Global Institutional & Specialty		1,268.6		1,118.2		2,395.2		2,109.5
Global Healthcare & Life Sciences		387.5		384.4		766.1		732.6
Other		362.6		332.5		691.9		619.3
Corporate		16.7		33.8		40.3		68.4
Subtotal at fixed currency rates		3,831.0		3,522.2		7,388.4		6,694.5
Effect of foreign currency translation		21.1		58.4		35.3		152.8
Consolidated reported GAAP net sales		$3,852.1		$3,580.6		$7,423.7		$6,847.3
Operating Income
Global Industrial		$255.4		$216.8		$471.0		$396.7
Global Institutional & Specialty		208.7		148.6		334.4		257.2
Global Healthcare & Life Sciences		32.7		55.2		67.7		97.1
Other		63.4		51.6		113.5		88.7
Corporate		(78.8)		(57.4)		(156.2)		(186.4)
Subtotal at fixed currency rates		481.4		414.8		830.4		653.3
Effect of foreign currency translation		3.3		11.0		5.9		27.0
Consolidated reported GAAP operating income		$484.7		$425.8		$836.3		$680.3

The profitability of the Company’s operating segments is evaluated by management based on operating income.

Consistent with the Company’s internal management reporting, Corporate amounts in the table above include sales to ChampionX in accordance with the long-term supply agreement entered into with the Transaction, as discussed in Note 14. Corporate also includes intangible asset amortization specifically from the Nalco and Purolite acquisitions and special (gains) and charges, as discussed in Note 2, that are not allocated to the Company’s reportable segments.

XML

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2023

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

16. COMMITMENTS AND CONTINGENCIES

The Company is subject to various claims and contingencies related to, among other things, workers’ compensation, general liability (including product liability), automobile claims, health care claims, environmental matters and lawsuits. The Company is also subject to various claims and contingencies related to income taxes. The Company also has contractual obligations including lease commitments.

The Company records liabilities when a contingent loss is probable and can be reasonably estimated. If the reasonable estimate of a probable loss is a range, the Company records the most probable estimate of the loss or the minimum amount when no amount within the range is a better estimate than any other amount. The Company discloses a contingent liability even if the liability is not probable or the amount is not estimable, or both, if there is a reasonable possibility that a material loss may have been incurred.

Insurance

Globally, the Company has insurance policies with varying deductible levels for property and casualty losses. The Company is insured for losses in excess of these deductibles, subject to policy terms and conditions and has recorded both a liability and an offsetting receivable for amounts in excess of these deductibles. The Company is self-insured for health care claims for eligible participating employees, subject to certain deductibles and limitations. The Company determines its liabilities for claims on an actuarial basis.

Litigation and Environmental Matters

The Company and certain subsidiaries are party to various lawsuits, claims and environmental actions that have arisen in the ordinary course of business. These include from time to time antitrust, employment, commercial, patent infringement, tort, product liability and wage hour lawsuits, as well as possible obligations to investigate and mitigate the effects on the environment of the disposal or release of certain chemical substances at various sites, such as Superfund sites and other operating or closed facilities. The Company has established accruals for certain lawsuits, claims and environmental matters. The Company currently believes that there is not a reasonably possible risk of material loss in excess of the amounts accrued related to these legal matters. Because litigation is inherently uncertain, and unfavorable rulings or developments could occur, there can be no certainty that the Company may not ultimately incur charges in excess of recorded liabilities. A future adverse ruling, settlement or unfavorable development could result in future charges that could have a material adverse effect on the Company’s results of operations or cash flows in the period in which they are recorded.

The Company currently believes that such future charges related to suits and legal claims, if any, would not have a material adverse effect on the Company’s consolidated financial position.

TPC Group Litigation

On November 27, 2019, a Butadiene production plant owned and operated by TPC Group, Inc. in Port Neches, Texas, experienced an explosion and fire that resulted in personal injuries, the release of chemical fumes and extensive property damage to the plant and surrounding areas in and near Port Neches, Texas.

Nalco Company LLC, a subsidiary of Ecolab, supplied process chemicals to TPC used in TPC’s production processes. Nalco did not operate, manage, maintain or control any aspect of TPC’s plant operations.

In connection with its provision of process chemicals to TPC, Nalco has been named in numerous lawsuits stemming from the plant explosion. Nalco has been named a defendant, along with TPC and other defendants, in multi-district litigation (“MDL”) proceedings pending in Orange County, Texas, alleging among other things claims for personal injury, property damage and business losses (In re TPC Group Litigation – A2020-0236-MDL, Orange County, Texas). In addition, numerous other lawsuits have been filed against Nalco, including TPC Group v. Nalco, E0208239, Jefferson County, Texas, a subrogation claim by TPC’s insurers seeking reimbursement for property damage losses. Over 5,000 plaintiffs (including the subrogation matter) currently have asserted claims against Nalco.

All of these cases make similar allegations and seek damages for personal injury, property damage, business losses and other damages, including exemplary damages. The Company expects all these cases will be consolidated for pretrial purposes into the Orange County MDL referenced above. Due to the large number of plaintiffs, the early stage of the litigation and the fact that many of the claims do not specify an amount of damages, any estimate of any loss or range of losses cannot be made at this time.

On June 1, 2022, TPC and seven of its affiliated companies filed for bankruptcy under Chapter 11 (Case No. 22-10493-CTG, United States Bankruptcy Court for the District of Delaware). In connection with the bankruptcy cases, TPC disclosed an estimated range of its liability related to the Port Neches incident to individuals and homeowners (including subrogation claims) of approximately $152 million to $520 million. As part of their bankruptcy plan, TPC and its affiliates announced a settlement which allows the MDL plaintiffs a $500 million claim solely for purposes of claim allowance in the chapter 11 case and distribution of value pursuant to TPC’s bankruptcy plan. Other key terms of the settlement between TPC and the MDL plaintiffs include the establishment of a settlement trust for the benefit of certain general unsecured creditors, which is funded with $30 million and the assignment of TPC’s claims and causes of action, if any, against certain third parties, including Nalco, related to the TPC plant explosion. As part of the bankruptcy process, TPC and its debtor affiliates received a discharge of all MDL related claims, as did certain non-debtor affiliates to the extent third parties did not opt out of the non-debtor releases. Nalco opted out of these releases, preserving any direct causes of action it may have against non-debtors. Furthermore, the allowance of the $500 million claim should have no effect on any claims or defenses asserted against or by Nalco in the MDL litigation. On December 1, 2022, the bankruptcy court confirmed the TPC bankruptcy plan, including the approval of the settlement and establishment of the aforementioned settlement trust. On December 16, 2022, the TPC bankruptcy plan went effective.

The Company believes the claims asserted against Nalco in the lawsuits stemming from the TPC plant explosion are without merit and intends to defend the claims vigorously. The Company also believes any potential loss should be covered by insurance subject to deductibles. However, the Company cannot predict the outcome of these lawsuits, the involvement the Company might have in these matters in the future or the potential for future litigation.

Environmental Matters

The Company is currently participating in environmental assessments and remediation at approximately 25 locations, the majority of which are in the U.S., and environmental liabilities have been accrued reflecting management’s best estimate of future costs. Potential insurance reimbursements are not anticipated in the Company’s accruals for environmental liabilities.

XML

NEW ACCOUNTING PRONOUNCEMENTS

6 Months Ended

Jun. 30, 2023

NEW ACCOUNTING PRONOUNCEMENTS

NEW ACCOUNTING PRONOUNCEMENTS

17. NEW ACCOUNTING PRONOUNCEMENTS

Standards That Were Adopted:
	Date of		Date of	Effect on the
Standard	Issuance	Description	Adoption	Financial Statements
ASU 2021-08 - Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers	October 2021	Update to improve the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to the recognition of an acquired contract liability and payment terms and their effect on subsequent revenue recognized by the acquirer.	January 1, 2023	The adoption of this standard did not have a significant impact on the Company's financial statements.

No other new accounting pronouncements issued or effective have had or are expected to have a material impact on the Company’s consolidated financial statements.

XML

SPECIAL (GAINS) AND CHARGES (Tables)

6 Months Ended

Jun. 30, 2023

Restructuring Activities

Special (gains) and charges

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Cost of sales
Restructuring activities		$8.1		$0.8		$11.3		$3.4
Acquisition and integration activities		-		0.9		-		28.5
Russia/Ukraine		-		-		-		6.4
Other		-		-		-		16.3
Cost of sales subtotal		8.1		1.7		11.3		54.6
Special (gains) and charges
Restructuring activities		13.7		0.3		26.3		1.1
Acquisition and integration activities		3.5		3.4		8.5		10.9
Russia/Ukraine		0.3		(5.7)		0.6		5.9
Other		3.5		5.6		10.1		9.8
Special (gains) and charges subtotal		21.0		3.6		45.5		27.7
Total special (gains) and charges		$29.1		$5.3		$56.8		$82.3

Combined Plan

Restructuring Activities

Restructuring activity

	Employee		Asset
(millions)	Costs		Disposals		Total
2022 Activity
Recorded expense and accrual		$67.2		$-		$67.2
Net cash payments		(5.2)		-		(5.2)
Net restructuring liability, December 31, 2022		62.0		-		62.0
2023 Activity
Recorded expense and accrual		27.0		6.1		33.1
Net cash payments		(51.1)		-		(51.1)
Non-cash charges		-		(6.1)		(6.1)
Reclassification		19.3		-		19.3
Net restructuring liability, June 30, 2023		$57.2		$-		$57.2

XML

ACQUISITIONS (Tables)

6 Months Ended

Jun. 30, 2023

ACQUISITIONS

Schedule of assets acquired and liabilities assumed

	June 30
(millions)	2023
Net tangible assets (liabilities) acquired		$9.4
Identifiable intangible assets
Customer relationships		35.7
Other technology		21.6
Total intangible assets		57.3
Goodwill		38.7
Total aggregate purchase price		105.4
Acquisition-related liabilities and contingent consideration		(4.8)
Net cash paid for acquisitions, including acquisition-related
liabilities and contingent consideration		$100.6

XML

BALANCE SHEETS INFORMATION (Tables)

6 Months Ended

Jun. 30, 2023

BALANCE SHEETS INFORMATION

Balance Sheet Information

	June 30		December 31
(millions)	2023		2022
Accounts receivable, net
Accounts receivable		$2,929.9		$2,829.0
Allowance for expected credit losses and other accruals		(149.8)		(130.9)
Total		$2,780.1		$2,698.1
Inventories
Finished goods		$1,041.8		$1,122.7
Raw materials and parts		834.6		849.2
Inventories at FIFO cost		1,876.4		1,971.9
FIFO cost to LIFO cost difference		(230.2)		(179.1)
Total		$1,646.2		$1,792.8
Other current assets
Prepaid assets		$137.6		$123.9
Taxes receivable		215.3		184.1
Derivative assets		62.2		57.5
Other		40.9		39.2
Total		$456.0		$404.7
Property, plant and equipment, net
Land		$155.0		$161.3
Buildings and leasehold improvements		1,145.0		1,126.9
Machinery and equipment		2,037.3		1,966.3
Merchandising and customer equipment		2,709.2		2,635.5
Capitalized software		941.6		962.1
Construction in progress		357.4		403.8
		7,345.5		7,255.9
Accumulated depreciation		(4,019.0)		(3,962.5)
Total		$3,326.5		$3,293.4
Other intangible assets, net
Intangible assets not subject to amortization
Trade names		$1,230.0		$1,230.0
Intangible assets subject to amortization
Customer relationships		3,353.4		3,292.8
Patents		501.6		497.0
Trademarks		406.3		404.0
Other technologies		541.0		518.8
		4,802.3		4,712.6
Accumulated amortization
Customer relationships		(1,697.8)		(1,581.7)
Patents		(307.9)		(292.3)
Trademarks		(219.6)		(202.5)
Other technologies		(203.4)		(185.4)
		(2,428.7)		(2,261.9)
Net intangible assets subject to amortization		2,373.6		2,450.7
Total		$3,603.6		$3,680.7
Other assets
Deferred income taxes		$110.2		$108.1
Pension		129.6		118.4
Derivative asset		33.2		44.5
Other		268.5		264.1
Total		$541.5		$535.1

	June 30		December 31
(millions)	2023		2022
Other current liabilities
Discounts and rebates		$392.9		$357.8
Dividends payable		151.0		150.8
Interest payable		75.3		58.7
Taxes payable, other than income		167.8		162.9
Derivative liability		0.4		21.9
Restructuring		73.7		100.6
Contract liability		107.4		116.5
Operating lease liabilities		110.1		108.3
Other		203.8		208.4
Total		$1,282.4		$1,285.9
Accumulated other comprehensive income (loss)
Unrealized (loss) gain on derivative financial instruments, net of tax		($2.5)		$3.7
Unrecognized pension and postretirement benefit expense, net of tax		(471.5)		(467.4)
Cumulative translation, net of tax		(1,287.8)		(1,262.9)
Total		($1,761.8)		($1,726.6)

XML

DEBT AND INTEREST (Tables)

6 Months Ended

Jun. 30, 2023

DEBT AND INTEREST

Schedule of short-term debt obligations

	June 30		December 31
(millions)	2023		2022
Short-term debt
Commercial paper		$-		$-
Notes payable		5.4		3.7
Long-term debt, current maturities		1,116.5		501.4
Total		$1,121.9		$505.1

Schedule of long-term debt obligations including current maturities

	Maturity	June 30		December 31
(millions)	by Year	2023		2022
Long-term debt
Public notes (2023 principal amount)
Two year 2021 senior notes ($500 million)	2023		$499.4		$498.7
Seven year 2016 senior notes (€575 million)	2024		614.0		596.9
Ten year 2015 senior notes (€575 million)	2025		613.3		596.7
Ten year 2016 senior notes ($750 million)	2026		721.3		721.1
Ten year 2017 senior notes ($500 million)	2027		434.5		433.9
Six Year 2021 senior notes ($500 million)	2027		496.9		496.5
Five Year 2022 senior notes ($500 million)	2028		493.4		492.7
Ten year 2020 senior notes ($698 million)	2030		652.8		653.5
Ten year 2020 senior notes ($600 million)	2031		555.7		555.2
Eleven year 2021 senior notes ($650 million)	2032		644.9		644.6
Thirty year 2011 senior notes ($389 million)	2041		384.6		384.5
Thirty year 2016 senior notes ($200 million)	2046		197.3		197.3
Thirty year 2017 senior notes ($484 million)	2047		426.1		425.5
Thirty year 2020 senior notes ($500 million)	2050		490.9		490.7
Thirty year 2021 senior notes ($850 million)	2051		839.1		838.9
Thirty-four year 2021 senior notes ($685 million)	2055		538.2		537.2
Finance lease obligations and other			13.7		12.8
Total debt			8,616.1		8,576.7
Long-term debt, current maturities			(1,116.5)		(501.4)
Total long-term debt			$7,499.6		$8,075.3

Schedule of interest expense and interest income

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Interest expense		$82.7		$57.3		$162.8		$112.4
Interest income		(4.9)		(1.3)		(10.8)		(3.4)
Interest expense, net		$77.8		$56.0		$152.0		$109.0

XML

GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2023

GOODWILL AND OTHER INTANGIBLE ASSETS

Changes in the carrying amount of goodwill

			Global		Global
	Global		Institutional		Healthcare &
(millions)	Industrial		& Specialty		Life Sciences		Other		Total
December 31, 2022		4,081.8		567.6		3,125.4		237.9		8,012.7
Current year business combinations		-		38.7		-		-		38.7
Effect of foreign currency translation		16.6		2.7		29.6		1.0		49.9
June 30, 2023		$4,098.4		$609.0		$3,155.0		$238.9		$8,101.3

XML

FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2023

FAIR VALUE MEASUREMENTS

Schedule of the carrying amount and estimated fair value of assets and liabilities measured on recurring basis

	June 30, 2023
(millions)	Carrying		Fair Value Measurements
	Amount		Level 1		Level 2		Level 3
Assets
Foreign currency forward contracts		$85.3		$-		$85.3		$-
Cross-currency swap derivative contracts		42.7		-		42.7		-
Liabilities
Foreign currency forward contracts		23.5		-		23.5		-
Interest rate swap agreements		182.6		-		182.6		-
Cross-currency swap derivative contracts		19.6		-		19.6		-

	December 31, 2022
(millions)	Carrying		Fair Value Measurements
	Amount		Level 1		Level 2		Level 3
Assets
Foreign currency forward contracts		$118.9		$-		$118.9		$-
Cross-currency swap derivative contracts		58.7		-		58.7		-
Liabilities
Foreign currency forward contracts		83.3		-		83.3		-
Interest rate swap agreements		181.4		-		181.4		-
Cross-currency swap derivative contracts		14.5		-		14.5		-

Schedule of carrying amount and estimated fair value of long-term debt

	June 30, 2023				December 31, 2022
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Long-term debt, including current maturities		$8,616.1		$7,806.2		$8,576.7		$7,643.6

XML

DERIVATIVES AND HEDGING TRANSACTIONS (Tables)

6 Months Ended

Jun. 30, 2023

DERIVATIVES AND HEDGING TRANSACTIONS

Gross fair value of the company's outstanding derivative assets and liabilities

	Derivative Assets				Derivative Liabilities
	June 30		December 31		June 30		December 31
(millions)	2023		2022		2023		2022
Derivatives designated as hedging instruments
Foreign currency forward contracts		$56.7		$78.6		$5.9		$9.2
Interest rate swap agreements		-		-		182.6		181.4
Cross-currency swap derivative contracts		42.7		58.7		19.6		14.5
Derivatives not designated as hedging instruments
Foreign currency forward contracts		28.6		40.3		17.6		74.1
Gross value of derivatives		128.0		177.6		225.7		279.2
Gross amounts offset in the Consolidated Balance Sheets		(32.6)		(75.6)		(32.6)		(75.6)
Net value of derivatives		$95.4		$102.0		$193.1		$203.6

Summary of notional values of outstanding derivatives

	Notional Values
		June 30	December 31
(millions)		2023	2022
Foreign currency forward contracts		$3,687		$5,745
Interest rate swap agreements		1,500		1,500
Cross-currency swap derivative contracts		682		650

Schedule of amounts on the Consolidated Balance Sheet related to cumulative basis adjustments for fair value hedges

	Carrying amount of the hedged liabilities				Cumulative amount of the fair value hedging adjustment included in the carrying amount of the hedged liabilities
	Second Quarter Ended				Second Quarter Ended
Line item in which the hedged item is included	June 30				June 30
(millions)	2023		2022		2023		2022
Long-term debt		$1,317.9		$1,376.4		($184.5)		($125.9)

Revaluation gains and losses on euro notes and cross-currency swap derivative

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Revaluation (loss) gain, net of tax:
Euronotes		($9.8)		$42.5		($24.9)		$52.8
Cross-currency swap derivative contracts		(14.0)		28.9		(15.6)		37.5
Total revaluation (loss) gain, net of tax		($23.8)		$71.4		($40.5)		$90.3

Impact on AOCI and earnings from derivative contracts qualified as cash flow hedges

	Second Quarter Ended
	June 30
	2023				2022
(millions)		COS	SG&A	Interest		COS	SG&A	Interest
Gain (loss) on derivatives in cash flow hedging relationship:
Foreign currency forward contracts
Amount of gain (loss) reclassified from AOCI to income		$2.8	($4.4)	$-		$0.8	$38.2	$-
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value		-	-	2.1		-	-	3.9
Interest rate swap agreements
Amount of (loss) gain reclassified from AOCI to income		-	-	(0.4)		-	-	(0.6)
(Loss) gain on derivatives not designated as hedging instruments:
Foreign currency forward contracts
Amount of (loss) gain recognized in income		-	(3.5)	-		-	34.2	-
Total gain (loss) of all derivative instruments		$2.8	($7.9)	$1.7		$0.8	$72.4	$3.3
	Six Months Ended
	June 30
	2023				2022
(millions)		COS	SG&A	Interest		COS	SG&A	Interest
Gain (loss) on derivatives in cash flow hedging relationship:
Foreign currency forward contracts
Amount of gain (loss) reclassified from AOCI to income		$8.1	($10.4)	$-		$0.8	$52.1	$-
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value		-	-	4.1		-	-	7.7
Interest rate swap agreements
Amount of (loss) gain reclassified from AOCI to income		-	-	(0.9)		-	-	(1.2)
(Loss) gain on derivatives not designated as hedging instruments:
Foreign currency forward contracts
Amount of (loss) gain recognized in income		-	(28.1)	-		-	48.4	-
Total gain (loss) of all derivative instruments		$8.1	($38.5)	$3.2		$0.8	$100.5	$6.5

XML

OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION (Tables)

6 Months Ended

Jun. 30, 2023

OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION

Schedule of other comprehensive income (loss) information related to the Company's derivatives and hedging instruments and pension and postretirement benefits

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Derivative and Hedging Instruments
Unrealized (loss) gain on derivative and hedging instruments
Amount recognized in AOCI		($1.6)		$49.7		($6.7)		$60.4
(Gain) loss reclassified from AOCI into income
COS		(2.8)		(0.8)		(8.1)		(0.8)
SG&A		4.4		(38.2)		10.4		(52.1)
Interest (income) expense, net		(1.7)		(3.3)		(3.2)		(6.5)
		(0.1)		(42.3)		(0.9)		(59.4)
Other activity		1.1		0.5		1.2		0.5
Tax impact		(0.9)		(1.8)		0.2		-
Net of tax		($1.5)		$6.1		($6.2)		$1.5
Pension and Postretirement Benefits
Amount reclassified from AOCI into income
Settlement charge		$-		$-		$0.6		$0.9
Amortization of net actuarial loss and prior period service credits, net		0.9		14.5		2.5		29.4
		0.9		14.5		3.1		30.3
Other activity		(4.5)		16.8		(6.1)		17.9
Tax impact		(0.7)		(3.3)		(1.1)		(6.5)
Net of tax		($4.3)		$28.0		($4.1)		$41.7

Summary of the net of tax derivative and pension and postretirement benefit amounts reclassified from AOCI into income

	Second Quarter Ended				Six Months Ended
	June 30				June 30
	2023		2022		2023		2022
(millions)
Derivative (gain) loss reclassified from AOCI into income, net of tax		($0.1)		($31.9)		($0.7)		($44.8)
Pension and postretirement benefits amortization of net actuarial losses and prior period service credits and settlement charges reclassified from AOCI into income, net of tax		(4.3)		28.0		(4.1)		41.7

XML

EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") (Tables)

6 Months Ended

Jun. 30, 2023

EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS")

Computations of the basic and diluted EPS

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions, except per share)	2023		2022		2023		2022
Net income attributable to Ecolab		$329.7		$308.3		$563.1		$480.2
Weighted-average common shares outstanding
Basic		284.9		285.1		284.8		285.7
Effect of dilutive stock options and units		1.4		1.5		1.3		1.7
Diluted		286.3		286.6		286.1		287.4
Earnings attributable to Ecolab per common share
Basic EPS		$ 1.16		$ 1.08		$ 1.98		$ 1.68
Diluted EPS		$ 1.15		$ 1.08		$ 1.97		$ 1.67
Anti-dilutive securities excluded from the computation of diluted EPS		2.6		2.6		3.8		2.6
Amounts do not necessarily sum due to rounding.

XML

PENSION AND POSTRETIREMENT PLANS (Tables)

6 Months Ended

Jun. 30, 2023

PENSION AND POSTRETIREMENT PLANS

Net periodic pension and postretirement health care benefit costs

The components of net periodic pension and postretirement health care benefit expense for the second quarter ended June 30 are as follows:

	U.S.				International				U.S. Postretirement
	Pension				Pension				Health Care
(millions)	2023		2022		2023		2022		2023		2022
Service cost		$10.6		$10.5		$5.4		$6.9		$0.1		$0.2
Interest cost on benefit obligation		22.0		14.1		11.6		5.5		1.4		0.8
Expected return on plan assets		(36.3)		(36.7)		(14.0)		(17.6)		-		(0.1)
Recognition of net actuarial loss (gain)		-		10.0		3.3		5.8		(0.8)		(0.1)
Amortization of prior service benefit		(1.5)		(1.2)		(0.1)		-		-		-
Total expense (benefit)		($5.2)		($3.3)		$6.2		$0.6		$0.7		$0.8

The components of net periodic pension and postretirement health care benefit expense for the six months ended June 30 are as follows:

	U.S.				International				U.S. Postretirement
	Pension				Pension				Health Care
(millions)	2023		2022		2023		2022		2023		2022
Service cost		$20.8		$21.0		$10.8		$14.2		$0.2		$0.4
Interest cost on benefit obligation		44.0		28.2		23.0		11.2		2.8		1.6
Expected return on plan assets		(72.6)		(73.4)		(27.8)		(36.0)		-		(0.2)
Recognition of net actuarial loss (gain)		-		20.0		6.8		11.8		(1.6)		(0.2)
Amortization of prior service benefit		(2.5)		(2.2)		(0.2)		-		-		-
Curtailments and settlements		0.7		0.9		-		-		(0.1)		-
Total expense (benefit)		($9.6)		($5.5)		$12.6		$1.2		$1.3		$1.6

XML

REVENUES (Tables)

6 Months Ended

Jun. 30, 2023

REVENUES

Schedule of operating lease revenue

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Operating lease revenue*		$128.7		$115.2		$255.1		$227.3

Schedule of principal activities, separated by reportable segments and geographic region

Net sales at public exchange rates by reportable segment are as follows:

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Global Industrial
Product and sold equipment		$1,587.8		$1,471.4		$3,086.0		$2,829.8
Service and lease equipment		220.7		218.5		431.9		425.8
Global Institutional & Specialty
Product and sold equipment		1,047.2		936.3		1,968.0		1,763.3
Service and lease equipment		225.0		193.0		433.0		375.4
Global Healthcare & Life Sciences
Product and sold equipment		363.9		360.2		716.5		694.2
Service and lease equipment		26.9		30.7		54.0		59.5
Other
Product and sold equipment		89.2		85.0		170.2		155.0
Service and lease equipment		274.7		251.6		523.7		475.6
Corporate
Product and sold equipment		16.7		33.9		40.4		68.6
Service and lease equipment		-		-		-		0.1
Total
Total product and sold equipment		$3,104.8		$2,886.8		$5,981.1		$5,510.9
Total service and lease equipment		$747.3		$693.8		$1,442.6		$1,336.4

Net sales at public exchange rates by geographic region for the second quarter ended June 30 are as follows:

	Global				Global Institutional				Global Healthcare
	Industrial				& Specialty				& Life Sciences				Other				Corporate
	2023		2022		2023		2022		2023		2022		2023		2022		2023		2022
North America		$814.7		$776.6		$933.8		$828.1		$156.4		$157.6		$232.3		$214.9		$12.4		$30.3
Europe		382.4		341.3		174.7		164.3		186.1		180.7		74.1		69.7		1.3		0.9
Asia Pacific		222.2		209.0		58.4		53.0		22.6		24.4		23.0		19.6		0.8		1.1
Latin America		181.0		156.0		47.6		41.5		6.6		5.3		14.2		13.1		2.2		1.6
Greater China		101.0		106.5		40.5		28.7		12.9		17.0		18.0		16.7		-		-
India, Middle East and Africa		107.2		100.5		17.2		13.7		6.2		5.9		2.3		2.6		-		-
Total		$1,808.5		$1,689.9		$1,272.2		$1,129.3		$390.8		$390.9		$363.9		$336.6		$16.7		$33.9

Net sales at public exchange rates by geographic region for the six months ended June 30 are as follows:

	Global				Global Institutional				Global Healthcare
	Industrial				& Specialty				& Life Sciences				Other				Corporate
(millions)	2023		2022		2023		2022		2023		2022		2023		2022		2023		2022
North America		$1,605.4		$1,493.2		$1,767.7		$1,560.1		$320.3		$302.6		$442.6		$396.6		$33.1		$59.7
Europe		731.2		654.8		321.2		301.0		360.5		350.8		141.3		131.8		2.0		1.5
Asia Pacific		436.5		414.1		115.2		105.7		42.3		44.4		43.2		36.2		1.8		2.1
Latin America		338.2		292.4		88.9		78.3		12.3		11.2		27.8		26.1		3.5		5.1
Greater China		195.6		216.7		76.1		68.9		23.7		31.8		34.3		34.6		-		0.1
India, Middle East and Africa		211.0		184.4		31.9		24.7		11.4		12.9		4.7		5.3		-		0.2
Total		$3,517.9		$3,255.6		$2,401.0		$2,138.7		$770.5		$753.7		$693.9		$630.6		$40.4		$68.7

Summarized activity in the allowance for doubtful accounts

	Six Months Ended
	June 30
(millions)	2023		2022
Beginning balance		$71.9		$52.8
Bad debt expense		32.5		24.8
Write-offs		(18.6)		(8.5)
Other (a)		(2.0)		3.8
Ending balance		$83.8		$72.9

(a) Other amounts are primarily the effects of changes in currency translations.

Schedule of contract liability

	Six Months Ended
	June 30
(millions)	2023		2022
Contract liability as of beginning of the year		$116.5		$91.7
Revenue recognized in the period from:
Amounts included in the contract liability at the beginning of the year		(116.5)		(91.7)
Increases due to billings excluding amounts recognized as revenue during the period ended		107.4		99.1
Contract liability as of end of period		$107.4		$99.1

XML

OPERATING SEGMENTS (Tables)

6 Months Ended

Jun. 30, 2023

OPERATING SEGMENTS

Schedule of financial information for each of the entity's reportable segments, including the impact of the preceding changes on previously reported full year 2021 net sales and operating income

	December 31, 2022
	2022 Reported					Fixed	2022 Reported
	Valued at 2022				Currency		Valued at 2023
(millions)	Management Rates		Other		Rate Change		Management Rates
Net Sales
Global Industrial		$6,944.0		$-		($207.7)		$6,736.3
Global Institutional & Specialty		4,480.0		10.2		(75.9)		4,414.3
Global Healthcare & Life Sciences		1,570.0		-		(64.2)		1,505.8
Other		1,355.0		(10.2)		(31.5)		1,313.3
Corporate		124.1		-		(0.4)		123.7
Subtotal at fixed currency rates		14,473.1		-		(379.7)		14,093.4
Effect of foreign currency translation		(285.3)				379.7		94.4
Consolidated reported GAAP net sales		$14,187.8		$-		$-		$14,187.8
Operating Income
Global Industrial		$977.0		$0.8		($42.0)		$935.8
Global Institutional & Specialty		634.5		(1.6)		(11.2)		621.7
Global Healthcare & Life Sciences		205.0		(1.8)		(9.9)		193.3
Other		212.8		2.6		(5.5)		209.9
Corporate		(416.7)		-		2.3		(414.4)
Subtotal at fixed currency rates		1,612.6		-		(66.3)		1,546.3
Effect of foreign currency translation		(50.1)				66.3		16.2
Consolidated reported GAAP operating income		$1,562.5		$-		$-		$1,562.5

Schedule of financial information for each of the entity's reportable segments

	Second Quarter Ended				Six Months Ended
	June 30				June 30
(millions)	2023		2022		2023		2022
Net Sales
Global Industrial		$1,795.6		$1,653.3		$3,494.9		$3,164.7
Global Institutional & Specialty		1,268.6		1,118.2		2,395.2		2,109.5
Global Healthcare & Life Sciences		387.5		384.4		766.1		732.6
Other		362.6		332.5		691.9		619.3
Corporate		16.7		33.8		40.3		68.4
Subtotal at fixed currency rates		3,831.0		3,522.2		7,388.4		6,694.5
Effect of foreign currency translation		21.1		58.4		35.3		152.8
Consolidated reported GAAP net sales		$3,852.1		$3,580.6		$7,423.7		$6,847.3
Operating Income
Global Industrial		$255.4		$216.8		$471.0		$396.7
Global Institutional & Specialty		208.7		148.6		334.4		257.2
Global Healthcare & Life Sciences		32.7		55.2		67.7		97.1
Other		63.4		51.6		113.5		88.7
Corporate		(78.8)		(57.4)		(156.2)		(186.4)
Subtotal at fixed currency rates		481.4		414.8		830.4		653.3
Effect of foreign currency translation		3.3		11.0		5.9		27.0
Consolidated reported GAAP operating income		$484.7		$425.8		$836.3		$680.3

XML

NEW ACCOUNTING PRONOUNCEMENTS (Tables)

6 Months Ended

Jun. 30, 2023

NEW ACCOUNTING PRONOUNCEMENTS

Schedule of new accounting pronouncements

Standards That Were Adopted:
	Date of		Date of	Effect on the
Standard	Issuance	Description	Adoption	Financial Statements
ASU 2021-08 - Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers	October 2021	Update to improve the accounting for acquired revenue contracts with customers in a business combination by addressing diversity in practice and inconsistency related to the recognition of an acquired contract liability and payment terms and their effect on subsequent revenue recognized by the acquirer.	January 1, 2023	The adoption of this standard did not have a significant impact on the Company's financial statements.

XML

SPECIAL (GAINS) AND CHARGES - Charges Reported on Statement of Income (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Special (gains) and charges
Other (income) expense	$ 21.0	$ 3.6	$ 45.5	$ 27.7
Total special (gains) and charges	29.1	5.3	56.8	82.3
Russia/Ukraine charges
Special (gains) and charges
Russia/Ukraine charges	0.3	(5.7)	0.6	12.3
Cost of sales
Special (gains) and charges
Restructuring activities	8.1	0.8	11.3	3.4
Acquisition and integration activities		0.9		28.5
Other special gains and charges				16.3
Other (income) expense	8.1	1.7	11.3	54.6
Cost of sales | Russia/Ukraine charges
Special (gains) and charges
Russia/Ukraine charges				6.4
Special (gains) and charges
Special (gains) and charges
Restructuring activities	13.7	0.3	26.3	1.1
Acquisition and integration activities	3.5	3.4	8.5	10.9
Other special gains and charges	3.5	5.6	10.1	9.8
Other (income) expense	21.0	3.6	45.5	27.7
Special (gains) and charges | Russia/Ukraine charges
Special (gains) and charges
Russia/Ukraine charges	$ 0.3	$ (5.7)	$ 0.6	$ 5.9

XML

SPECIAL (GAINS) AND CHARGES - Restructuring and Non-Restructuring Activity (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Mar. 31, 2023	Feb. 28, 2023	Nov. 30, 2022
Other restructuring information
Cash payments			$ 9.5
Special (gains) and charges	$ 21.0	$ 3.6	45.5	$ 27.7
Non-restructuring Special (Gains) and Charges
Accounts payable	1,476.8		1,476.8		$ 1,728.2
Other current liabilities	1,282.4		1,282.4		1,285.9
Special (gains) and charges
Other restructuring information
Restructuring charges incurred, pre-tax	13.7	0.3	26.3	1.1
Business combination advisory and legal fees, pre tax	3.5	3.4	8.5	10.9
Other special gains and charges	3.5	5.6	10.1	9.8
Special (gains) and charges	21.0	3.6	45.5	27.7
Non-restructuring Special (Gains) and Charges
Business combination and integration related costs, pre tax	3.5	3.4	8.5	10.9
Business combination and integration related costs, after tax	2.7	2.4	6.4	8.3
Cost of sales
Other restructuring information
Restructuring charges incurred, pre-tax	8.1	0.8	11.3	3.4
Business combination advisory and legal fees, pre tax		0.9		28.5
Business combination advisory and legal fees, after tax		0.6		21.6
Other special gains and charges				16.3
Special (gains) and charges	8.1	1.7	11.3	54.6
Specific legal reserve and related legal charges
Other restructuring information
Other special gains and charges	3.5		10.1
Other special gains and charges, after-tax	2.6		7.7
Russia/Ukraine charges
Other restructuring information
Russia/Ukraine charges	0.3	(5.7)	0.6	12.3
Charges related to recoverability risk	0.2	(5.7)	0.5	13.3
Russia/Ukraine charges | Special (gains) and charges
Other restructuring information
Russia/Ukraine charges	0.3	(5.7)	0.6	5.9
Russia/Ukraine charges | Cost of sales
Other restructuring information
Russia/Ukraine charges				6.4
Product and equipment sales | Cost of sales
Other restructuring information
Other special gains and charges		5.6		26.1
Other special gains and charges, after-tax		4.4		19.7
Institutional Advancement Program
Restructuring
Non-cash net charges	(1.6)		3.3
Other restructuring information
Restructuring charge expected to be incurred, pre-tax	70.0		70.0
Restructuring charge expected to be incurred, after tax	55.0		55.0
Restructuring liability	0.0		0.0		1.9
Restructuring charges incurred to date, pre-tax	58.6		58.6
Restructuring charges incurred to date, after-tax	44.8		44.8
Restructuring charges incurred, pre-tax	2.1	0.7	4.5	2.1
Restructuring charges incurred, after tax	1.6	0.6	3.4	1.6
Cash payments	0.7		3.1
Accelerate 2020 Restructuring Plan
Other restructuring information
Restructuring charge expected to be incurred, pre-tax	254.4		254.4
Restructuring charge expected to be incurred, after tax	198.4		198.4
Restructuring liability					18.1
Cash payments	5.4
Accelerate 2020 Restructuring Plan | Special (gains) and charges
Other restructuring information
Restructuring liability	8.6		8.6
Other Restructuring Plan
Restructuring
Restructuring reserve, period increase (decrease)			(19.3)
Other restructuring information
Restructuring charges incurred, pre-tax		0.3		2.0
Restructuring charges incurred, after tax		$ 0.2		$ 1.5
Prior Year Plans
Other restructuring information
Restructuring liability	3.7		3.7		23.2
Cash payments	0.0		0.2
Combined Plan
Restructuring
Recorded expense (income) and accrual			33.1		67.2
Net cash payments			(51.1)		(5.2)
Non-cash net charges			(6.1)
Reclassification			19.3
Other restructuring information
Restructuring charge expected to be incurred, pre-tax						$ 19.3	$ 195.0
Restructuring charge expected to be incurred, after tax						$ 14.5	$ 150.0
Restructuring liability	57.2		57.2		62.0
Combined Plan | Employee termination costs
Restructuring
Recorded expense (income) and accrual			27.0		67.2
Net cash payments			(51.1)		(5.2)
Reclassification			19.3
Other restructuring information
Restructuring liability	57.2		57.2		$ 62.0
Restructuring charges incurred, pre-tax	19.7		33.1
Restructuring charges incurred, after tax	$ 16.2		26.4
Combined Plan | Asset disposals
Restructuring
Recorded expense (income) and accrual			6.1
Non-cash net charges			$ (6.1)
Europe Program
Other restructuring information
Restructuring charge expected to be incurred, pre-tax								$ 130.0
Restructuring charge expected to be incurred, after tax								$ 110.0

XML

ACQUISITIONS - Acquisition Summary (Details) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2033 USD ($) item	Mar. 31, 2023 item	Jun. 30, 2033	Jun. 30, 2022 USD ($) item
Business Acquisition [Line Items]
Number of acquisitions | item	3	0		0
Payments for Merger Related Costs				$ 7.2
Prior year business combinations, acquisition related net liabilities adjustments				7.1
Prior year business combinations, net intangible assets adjustments				(5.6)
Prior year business combinations, goodwill adjustments				19.9
Intangible assets acquired				$ 0.0
Business Acquisitions and Investment
Business Acquisition [Line Items]
Number of acquisitions | item	2
Net tangible assets (liabilities) acquired	$ 9.4
Customer relationships	35.7
Other technology	21.6
Total intangible assets	57.3
Goodwill	38.7
Total aggregate purchase price	105.4
Acquisition related liabilities and contingent consideration	(4.8)
Net cash paid for acquisitions, including acquisition-related liabilities and contingent consideration	$ 100.6
Weighted average useful lives of definite-lived intangible assets acquired from other acquisitions			12 years

XML

BALANCE SHEETS INFORMATION (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Accounts receivable, net
Accounts receivable	$ 2,929.9	$ 2,829.0
Allowance for expected credit losses and other accruals	(149.8)	(130.9)
Total	2,780.1	2,698.1
Inventories
Finished goods	1,041.8	1,122.7
Raw materials and parts	834.6	849.2
Inventories at FIFO cost	1,876.4	1,971.9
FIFO cost to LIFO cost difference	(230.2)	(179.1)
Total	1,646.2	1,792.8
Other current assets
Prepaid assets	137.6	123.9
Taxes receivable	215.3	184.1
Derivative assets	62.2	57.5
Other	40.9	39.2
Total	456.0	404.7
Property, plant and equipment, net
Land	155.0	161.3
Buildings and leasehold improvements	1,145.0	1,126.9
Machinery and equipment	2,037.3	1,966.3
Merchandising and customer equipment	2,709.2	2,635.5
Capitalized software	941.6	962.1
Construction in progress	357.4	403.8
Property, plant and equipment, gross	7,345.5	7,255.9
Accumulated depreciation	(4,019.0)	(3,962.5)
Total	3,326.5	3,293.4
Intangible assets subject to amortization:
Other intangible assets, gross	4,802.3	4,712.6
Accumulated amortization	(2,428.7)	(2,261.9)
Net intangible assets subject to amortization	2,373.6	2,450.7
Total	3,603.6	3,680.7
Other assets
Deferred income taxes	110.2	108.1
Pension	129.6	118.4
Derivative asset	33.2	44.5
Other	268.5	264.1
Total	541.5	535.1
Other current liabilities
Discounts and rebates	392.9	357.8
Dividends payable	151.0	150.8
Interest payable	75.3	58.7
Taxes payable, other than income	167.8	162.9
Derivative liability	0.4	21.9
Restructuring	73.7	100.6
Contract liability	107.4	116.5
Operating lease liabilities	110.1	108.3
Other	203.8	208.4
Total	1,282.4	1,285.9
Accumulated other comprehensive income (loss)
Unrealized (loss) gain on derivative financial instruments, net of tax	(2.5)	3.7
Unrecognized pension and postretirement benefit expense, net of tax	(471.5)	(467.4)
Cumulative translation, net of tax	(1,287.8)	(1,262.9)
Total	(1,761.8)	(1,726.6)
Customer relationships
Intangible assets subject to amortization:
Other intangible assets, gross	3,353.4	3,292.8
Accumulated amortization	(1,697.8)	(1,581.7)
Trademarks
Intangible assets subject to amortization:
Other intangible assets, gross	406.3	404.0
Accumulated amortization	(219.6)	(202.5)
Patents
Intangible assets subject to amortization:
Other intangible assets, gross	501.6	497.0
Accumulated amortization	(307.9)	(292.3)
Other technologies
Intangible assets subject to amortization:
Other intangible assets, gross	541.0	518.8
Accumulated amortization	(203.4)	(185.4)
Trade names.
Intangible assets not subject to amortization:
Other intangible assets, gross	$ 1,230.0	$ 1,230.0

XML

DEBT AND INTEREST (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Components of the company's debt obligations
Long-term debt, current maturities	$ 1,116.5	$ 501.4
Short-term debt including current maturities of long-term debt	1,121.9	505.1
Commercial paper
Components of the company's debt obligations
Maximum borrowing capacity, commercial paper	2,000.0
U.S. commercial paper program
Components of the company's debt obligations
Maximum borrowing capacity, commercial paper	2,000.0
Outstanding commercial paper	0.0	0.0
European commercial paper
Components of the company's debt obligations
Maximum borrowing capacity, commercial paper	2,000.0
Notes payable
Components of the company's debt obligations
Short term borrowings	5.4	3.7
Multi Currency Revolving Credit Facility
Components of the company's debt obligations
Maximum borrowing capacity under the credit agreement	2,000.0
Amount outstanding under the credit agreement	$ 0.0	$ 0.0

XML

DEBT AND INTEREST - Other Debt Information (Details) € in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 EUR (€)	Dec. 31, 2022 USD ($)
Debt instrument
Carrying value	$ 8,616.1		$ 8,616.1			$ 8,576.7
Long-term debt, current maturities	(1,116.5)		(1,116.5)			(501.4)
Long-term debt	7,499.6		7,499.6			8,075.3
Interest
Interest expense	82.7	$ 57.3	162.8	$ 112.4
Interest income	(4.9)	(1.3)	(10.8)	(3.4)
Interest expense, net	77.8	$ 56.0	$ 152.0	$ 109.0
Public Notes
Debt instrument
Principal outstanding payable at time of prepayment of notes (as a percent)			101.00%
Two Year 2021 Senior Notes
Debt instrument
Carrying value	499.4		$ 499.4			498.7
Aggregate principal amount	500.0		$ 500.0
Debt instrument, term			2 years
Five Year 2022 senior notes
Debt instrument
Carrying value	493.4		$ 493.4			492.7
Aggregate principal amount	500.0		$ 500.0
Debt instrument, term			5 years
Six Year 2021 Senior Notes
Debt instrument
Carrying value	496.9		$ 496.9			496.5
Aggregate principal amount	500.0		$ 500.0
Debt instrument, term			6 years
Ten year 2017 senior notes
Debt instrument
Carrying value	434.5		$ 434.5			433.9
Aggregate principal amount	500.0		$ 500.0
Debt instrument, term			10 years
Ten year 2020 senior notes
Debt instrument
Carrying value	652.8		$ 652.8			653.5
Aggregate principal amount	698.0		$ 698.0
Debt instrument, term			10 years
Ten year 2020 senior notes, maturing in 2031
Debt instrument
Carrying value	555.7		$ 555.7			555.2
Aggregate principal amount	600.0		$ 600.0
Debt instrument, term			10 years
Eleven Year 2021 Senior Notes
Debt instrument
Carrying value	644.9		$ 644.9			644.6
Aggregate principal amount	650.0		$ 650.0
Debt instrument, term			11 years
Thirty year 2011 senior notes
Debt instrument
Carrying value	384.6		$ 384.6			384.5
Aggregate principal amount	389.0		$ 389.0
Debt instrument, term			30 years
Thirty year 2017 senior notes
Debt instrument
Carrying value	426.1		$ 426.1			425.5
Aggregate principal amount	484.0		$ 484.0
Debt instrument, term			30 years
Thirty year 2020 senior notes
Debt instrument
Carrying value	490.9		$ 490.9			490.7
Aggregate principal amount	500.0		$ 500.0
Debt instrument, term			30 years
Thirty Year 2021 Senior Notes
Debt instrument
Carrying value	839.1		$ 839.1			838.9
Aggregate principal amount	850.0		$ 850.0
Debt instrument, term			30 years
Thirty-four year 2021 senior notes
Debt instrument
Carrying value	538.2		$ 538.2			537.2
Aggregate principal amount	685.0		$ 685.0
Debt instrument, term			34 years
Seven year 2016 senior euro notes
Debt instrument
Carrying value	614.0		$ 614.0			596.9
Aggregate principal amount | €					€ 575
Debt instrument, term			7 years
Ten year 2016 senior notes
Debt instrument
Carrying value	721.3		$ 721.3			721.1
Aggregate principal amount	750.0		$ 750.0
Debt instrument, term			10 years
Thirty year 2016 senior notes
Debt instrument
Carrying value	197.3		$ 197.3			197.3
Aggregate principal amount	200.0		$ 200.0
Debt instrument, term			30 years
Ten Year 2015 senior euro notes
Debt instrument
Carrying value	613.3		$ 613.3			596.7
Aggregate principal amount | €					€ 575
Debt instrument, term			10 years
Other debt.
Debt instrument
Carrying value	$ 13.7		$ 13.7			$ 12.8

XML

GOODWILL AND OTHER INTANGIBLE ASSETS (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Changes in the carrying amount of goodwill for each of the company's reportable segments
Impairment of goodwill			$ 0.0
Changes in the carrying amount of goodwill
Beginning goodwill			8,012.7
Current year business combinations			38.7
Effect of foreign currency translation			49.9
Ending goodwill	$ 8,101.3		8,101.3
Future estimated amortization expense related to amortizable other identifiable intangible assets
Estimated expense for the remaining six-month period	151.0		151.0
Total amortization expense related to other intangible assets	76.8	$ 78.7	152.4	$ 158.2
Nalco Holding Company ("Nalco") | Trademarks
Changes in the carrying amount of goodwill
Impairment of indefinite life intangible asset			0.0
Carrying value of asset subject to impairment testing	1,200.0		1,200.0
Global Industrial
Changes in the carrying amount of goodwill
Beginning goodwill			4,081.8
Effect of foreign currency translation			16.6
Ending goodwill	4,098.4		4,098.4
Global Institutional and Specialty
Changes in the carrying amount of goodwill
Beginning goodwill			567.6
Current year business combinations			38.7
Effect of foreign currency translation			2.7
Ending goodwill	609.0		609.0
Global Healthcare and Life Sciences
Changes in the carrying amount of goodwill
Beginning goodwill			3,125.4
Effect of foreign currency translation			29.6
Ending goodwill	3,155.0		3,155.0
Other
Changes in the carrying amount of goodwill
Beginning goodwill			237.9
Effect of foreign currency translation			1.0
Ending goodwill	$ 238.9		$ 238.9

XML

FAIR VALUE MEASUREMENTS (Details) - Recurring - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Carrying Amount | Foreign currency forward contracts
Assets:
Foreign currency forward contracts	$ 85.3	$ 118.9
Liabilities:
Foreign currency forward contracts	23.5	83.3
Carrying Amount | Interest rate swap agreements
Liabilities:
Interest rate swap agreements	182.6	181.4
Carrying Amount | Cross-currency swap derivative contracts
Assets:
Foreign currency forward contracts	42.7	58.7
Liabilities:
Foreign currency forward contracts		14.5
Interest rate swap agreements	19.6
Level 2 | Foreign currency forward contracts
Assets:
Foreign currency forward contracts	85.3	118.9
Liabilities:
Foreign currency forward contracts	23.5	83.3
Level 2 | Interest rate swap agreements
Liabilities:
Interest rate swap agreements	182.6	181.4
Level 2 | Cross-currency swap derivative contracts
Assets:
Foreign currency forward contracts	42.7	58.7
Liabilities:
Foreign currency forward contracts		$ 14.5
Interest rate swap agreements	$ 19.6

XML

FAIR VALUE MEASUREMENTS - Long-term Debt (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Carrying Amount
Carrying amount and fair value of financial instruments
Long-term debt, including current maturities	$ 8,616.1	$ 8,576.7
Fair Value | Level 2
Carrying amount and fair value of financial instruments
Long-term debt, including current maturities	$ 7,806.2	$ 7,643.6

XML

DERIVATIVES AND HEDGING TRANSACTIONS - Derivative Positions Summary (Details) - USD ($) $ in Millions	Jun. 30, 2023	Dec. 31, 2022
Asset Derivatives
Gross value of derivatives	$ 128.0	$ 177.6
Gross amounts offset in the Consolidated Balance Sheet	(32.6)	(75.6)
Net value of derivatives presented in the Consolidated Balance Sheet	95.4	102.0
Liability Derivatives
Gross value of derivatives	225.7	279.2
Gross amounts offset in the Consolidated Balance Sheet	(32.6)	(75.6)
Net value of derivatives presented in the Consolidated Balance Sheet	193.1	203.6
Cash collateral received	0.0
Cash collateral pledged	0.0
Foreign currency forward contracts
Liability Derivatives
Notional values	3,687.0	5,745.0
Interest rate swap agreements
Liability Derivatives
Notional values	1,500.0	1,500.0
Cross-currency swap derivative contracts
Liability Derivatives
Notional values	682.0	650.0
Derivatives designated as hedging instruments | Foreign currency forward contracts
Asset Derivatives
Gross value of derivatives	56.7	78.6
Liability Derivatives
Gross value of derivatives	5.9	9.2
Derivatives designated as hedging instruments | Interest rate swap agreements
Liability Derivatives
Gross value of derivatives	182.6	181.4
Derivatives designated as hedging instruments | Cross-currency swap derivative contracts
Asset Derivatives
Gross value of derivatives	42.7	58.7
Liability Derivatives
Gross value of derivatives	19.6	14.5
Derivatives not designated as hedging instruments | Foreign currency forward contracts
Asset Derivatives
Gross value of derivatives	28.6	40.3
Liability Derivatives
Gross value of derivatives	$ 17.6	$ 74.1

XML

DERIVATIVES AND HEDGING TRANSACTIONS - Information by Type of Derivative and Hedging Activities (Details) € in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 EUR (€)	Dec. 31, 2022 USD ($)
Cash Flow Hedges
Maximum period for hedged transactions			1 year
Fair Value Hedges
Derivative liability	$ 193.1		$ 193.1			$ 203.6
Net Investment Hedges
Revaluation (loss) gain, net of tax	(23.8)	$ 71.4	(40.5)	$ 90.3
Seven year 2008 senior notes
Fair Value Hedges
Aggregate principal amount	1,500.0		1,500.0
Cost of sales
Impact on AOCI and earnings from derivative contracts
Gain (loss) on derivative recognized in income	2.8	0.8	8.1	0.8
Selling, general and administrative expenses
Impact on AOCI and earnings from derivative contracts
Gain (loss) on derivative recognized in income	(7.9)	72.4	(38.5)	100.5
Interest expense, net
Impact on AOCI and earnings from derivative contracts
Gain (loss) on derivative recognized in income	1.7	3.3	3.2	6.5
Foreign currency forward contracts
Net Investment Hedges
Notional values	3,687.0		3,687.0			5,745.0
Foreign currency forward contracts | Derivatives not designated as hedging instruments
Impact on AOCI and earnings from derivative contracts
Gain (loss) on derivative recognized in income	$ (3.5)	$ 34.2	$ (28.1)	$ 48.4
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]	Selling, General and Administrative Expense	Selling, General and Administrative Expense	Selling, General and Administrative Expense	Selling, General and Administrative Expense
Interest rate swap agreements
Net Investment Hedges
Notional values	$ 1,500.0		$ 1,500.0			1,500.0
Euro Notes
Net Investment Hedges
Revaluation (loss) gain, net of tax	(9.8)	$ 42.5	(24.9)	$ 52.8
Cross-currency swap derivative contracts
Net Investment Hedges
Notional values	682.0		682.0			$ 650.0
Revaluation (loss) gain, net of tax	$ (14.0)	$ 28.9	(15.6)	37.5
Cash Flow Hedges. | Derivatives designated as hedging instruments | Interest expense, net
Impact on AOCI and earnings from derivative contracts
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value			$ 4.1	$ 7.7
Cash Flow Hedges. | Foreign currency forward contracts | Derivatives designated as hedging instruments
Impact on AOCI and earnings from derivative contracts
Derivative Instrument, Gain (Loss) Reclassified from AOCI into Income, Effective Portion, Statement of Income or Comprehensive Income [Extensible Enumeration]	Selling, General and Administrative Expense	Selling, General and Administrative Expense	Selling, General and Administrative Expense	Selling, General and Administrative Expense
Cash Flow Hedges. | Foreign currency forward contracts | Derivatives designated as hedging instruments | Cost of sales
Impact on AOCI and earnings from derivative contracts
Gain (loss) reclassified from AOCI into income (effective portion)	$ 2.8	$ 0.8	$ 8.1	$ 0.8
Cash Flow Hedges. | Foreign currency forward contracts | Derivatives designated as hedging instruments | Selling, general and administrative expenses
Impact on AOCI and earnings from derivative contracts
Gain (loss) reclassified from AOCI into income (effective portion)	(4.4)	38.2	$ (10.4)	$ 52.1
Cash Flow Hedges. | Foreign currency forward contracts | Derivatives designated as hedging instruments | Interest expense, net
Impact on AOCI and earnings from derivative contracts
Amount excluded from the assessment of effectiveness recognized in earnings based on changes in fair value	2.1	3.9
Cash Flow Hedges. | Interest rate swap agreements | Derivatives designated as hedging instruments
Impact on AOCI and earnings from derivative contracts
Gain (loss) reclassified from AOCI into income (effective portion)	$ (0.4)	$ (0.6)
Derivative Instrument, Gain (Loss) Reclassified from AOCI into Income, Effective Portion, Statement of Income or Comprehensive Income [Extensible Enumeration]	Interest Expense, Net	Interest Expense, Net	Interest Expense, Net	Interest Expense, Net
Gain (loss) on derivative recognized in income			$ (0.9)	$ (1.2)
Fair Value Hedges | Interest rate swap agreements
Fair Value Hedges
Cumulative amount of fair value hedging adjustment	$ (184.5)	$ (125.9)	(184.5)	(125.9)
Derivative liability	1,317.9	$ 1,376.4	1,317.9	$ 1,376.4
Net Investment Hedge | Senior euro notes
Net Investment Hedges
Notional values	1,229.0		1,229.0		€ 1,150
Net Investment Hedge | Cross-currency swap derivative contracts
Net Investment Hedges
Notional values	$ 682.0		$ 682.0		€ 625

XML

OTHER COMPREHENSIVE INCOME (LOSS) INFORMATION (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Reclassification adjustments
COS	$ (2,334.8)	$ (2,211.1)	$ (4,540.0)	$ (4,284.5)
SG&A	(1,011.6)	(940.1)	(2,001.9)	(1,854.8)
Interest (income) expense, net	(77.8)	(56.0)	(152.0)	(109.0)
Subtotal	(26.6)	(57.2)	(36.7)	13.0
Derivative (gain) loss reclassified from AOCI into income, net of tax	(0.1)	(31.9)	(0.7)	(44.8)
Pension and postretirement benefits amortization of net actuarial losses and prior service credits and settlement charges reclassified from AOCI into income, net of tax	(4.3)	28.0	(4.1)	41.7
Derivative & Hedging Instruments
Reclassification adjustments
Amount recognized in AOCI	(1.6)	49.7	(6.7)	60.4
Other activity	1.1	0.5	1.2	0.5
Tax impact	(0.9)	(1.8)	0.2
Subtotal	(1.5)	6.1	(6.2)	1.5
Derivative & Hedging Instruments | Reclassifications adjustments
Reclassification adjustments
COS	(2.8)	(0.8)	(8.1)	(0.8)
SG&A	4.4	(38.2)	10.4	(52.1)
Interest (income) expense, net	(1.7)	(3.3)	(3.2)	(6.5)
(Gains) losses reclassified from AOCI into income	(0.1)	(42.3)	(0.9)	(59.4)
Pension & Postretirement Benefits
Reclassification adjustments
(Gains) losses reclassified from AOCI into income	0.9	14.5	3.1	30.3
Other activity	(4.5)	16.8	(6.1)	17.9
Tax impact	(0.7)	(3.3)	(1.1)	(6.5)
Subtotal	(4.3)	28.0	(4.1)	41.7
Pension & Postretirement Benefits | Reclassifications adjustments
Reclassification adjustments
(Gains) losses reclassified from AOCI into income	$ 0.9	$ 14.5	2.5	29.4
Settlement charge | Reclassifications adjustments
Reclassification adjustments
(Gains) losses reclassified from AOCI into income			$ 0.6	$ 0.9

XML

SHAREHOLDERS' EQUITY (Details) - COMMON STOCK - shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Nov. 30, 2022	Feb. 28, 2015
Shareholder's Equity
Common stock, shares authorized to be repurchased			10,000,000	20,000,000
Remaining shares authorized to be repurchased	12,917,097
Reacquired shares (in shares)	68,712	2,284,094
Number of shares reacquired through the open market		2,186,990
Number of shares that have been repurchased through the exercise of stock options and vesting of stock awards		97,104

XML

EARNINGS ATTRIBUTABLE TO ECOLAB PER COMMON SHARE ("EPS") (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Computations of the basic and diluted earnings attributable to Ecolab per share amounts
Net income attributable to Ecolab	$ 329.7	$ 308.3	$ 563.1	$ 480.2
Weighted-average common shares outstanding
Basic (in shares)	284.9	285.1	284.8	285.7
Effect of dilutive stock options and units (in shares)	1.4	1.5	1.3	1.7
Diluted (in shares)	286.3	286.6	286.1	287.4
Earnings attributable to Ecolab per common share
Basic EPS (in dollars per share)	$ 1.16	$ 1.08	$ 1.98	$ 1.68
Diluted EPS (in dollars per share)	$ 1.15	$ 1.08	$ 1.97	$ 1.67
Anti-dilutive securities excluded from the computation of diluted EPS	2.6	2.6	3.8	2.6

XML

INCOME TAXES (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
INCOME TAXES
Effective income tax rate (as a percent)	20.60%	19.70%	19.50%	20.00%
Recognized discrete tax expense (benefit)	$ 2.8	$ 3.7	$ 1.2	$ 4.7
Recognized other discrete tax expense (benefit)	4.6	4.4	0.7	8.3
Excess tax benefits, share-based compensation	$ 1.8	$ 0.7	$ 1.9	$ 3.6

XML

PENSION AND POSTRETIREMENT PLANS (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
U.S. Pension. | Pension
Net periodic benefit costs
Service cost	$ 10.6	$ 10.5	$ 20.8	$ 21.0
Interest cost on benefit obligation	22.0	14.1	44.0	28.2
Expected return on plan assets	(36.3)	(36.7)	(72.6)	(73.4)
Recognition of net actuarial loss (gain)		10.0		20.0
Amortization of prior service benefit	(1.5)	(1.2)	(2.5)	(2.2)
Curtailments and settlements			0.7	0.9
Total expense	(5.2)	(3.3)	(9.6)	(5.5)
U.S. Pension. | Pension | Non-qualified plan
Other Pension Plan Information
Contributions to plan			4.0
Contributions anticipated to be made during the remainder of 2023	5.0		5.0
U.S. Pension. | U.S. Postretirement Benefits
Net periodic benefit costs
Service cost	0.1	0.2	0.2	0.4
Interest cost on benefit obligation	1.4	0.8	2.8	1.6
Expected return on plan assets		(0.1)		(0.2)
Recognition of net actuarial loss (gain)	(0.8)	(0.1)	(1.6)	(0.2)
Curtailments and settlements			(0.1)
Total expense	0.7	0.8	1.3	1.6
Other Pension Plan Information
Contributions to plan			5.0
Contributions anticipated to be made during the remainder of 2023	6.0		6.0
International Pension | Pension
Net periodic benefit costs
Service cost	5.4	6.9	10.8	14.2
Interest cost on benefit obligation	11.6	5.5	23.0	11.2
Expected return on plan assets	(14.0)	(17.6)	(27.8)	(36.0)
Recognition of net actuarial loss (gain)	3.3	5.8	6.8	11.8
Amortization of prior service benefit	(0.1)		(0.2)
Total expense	6.2	$ 0.6	12.6	$ 1.2
Other Pension Plan Information
Contributions to plan			20.0
Contributions anticipated to be made during the remainder of 2023	$ 22.0		$ 22.0

XML

REVENUES - Product and Sold Equipment (Details) - USD ($) $ in Millions		3 Months Ended		6 Months Ended
	Jun. 03, 2020	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Disposal Group, Including Discontinued Operation, Classified Balance Sheet Disclosures [Abstract]
Accounts receivable, net		$ 2,780.1		$ 2,780.1		$ 2,698.1
ChampionX | Discontinued Operations, Disposed of By Sale
Disposal Group, Including Discontinued Operation, Classified Balance Sheet Disclosures [Abstract]
Period of time post-separation that the entity may transfer or receive certain products	36 months
Post-separation sales		16.7	$ 33.9	40.4	$ 68.6
Accounts receivable, net		$ 12.0		$ 12.0		$ 12.9

XML

REVENUES - Operating Lease Revenue (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Operating Lease, Lease Income
Operating lease revenue	$ 128.7	$ 115.2	$ 255.1	$ 227.3

XML

REVENUES - Principal Activities (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Disaggregation of revenue
Net sales	$ 3,852.1	$ 3,580.6	$ 7,423.7	$ 6,847.3
U.S. Pension. | Geographic concentration | Consolidated net sales
Disaggregation of revenue
Percentage of consolidated sales			53.00%	53.00%
Product and equipment sales
Disaggregation of revenue
Net sales	3,104.8	2,886.8	$ 5,981.1	$ 5,510.9
Service and lease sales
Disaggregation of revenue
Net sales	747.3	693.8	1,442.6	1,336.4
Global Industrial
Disaggregation of revenue
Net sales	1,808.5	1,689.9	3,517.9	3,255.6
Global Industrial | North America
Disaggregation of revenue
Net sales	814.7	776.6	1,605.4	1,493.2
Global Industrial | Europe
Disaggregation of revenue
Net sales	382.4	341.3	731.2	654.8
Global Industrial | Asia Pacific
Disaggregation of revenue
Net sales	222.2	209.0	436.5	414.1
Global Industrial | Latin America
Disaggregation of revenue
Net sales	181.0	156.0	338.2	292.4
Global Industrial | Greater China
Disaggregation of revenue
Net sales	101.0	106.5	195.6	216.7
Global Industrial | India, Middle East and Africa
Disaggregation of revenue
Net sales	107.2	100.5	211.0	184.4
Global Industrial | Product and equipment sales
Disaggregation of revenue
Net sales	1,587.8	1,471.4	3,086.0	2,829.8
Global Industrial | Service and lease sales
Disaggregation of revenue
Net sales	220.7	218.5	431.9	425.8
Global Institutional and Specialty
Disaggregation of revenue
Net sales	1,272.2	1,129.3	2,401.0	2,138.7
Global Institutional and Specialty | North America
Disaggregation of revenue
Net sales	933.8	828.1	1,767.7	1,560.1
Global Institutional and Specialty | Europe
Disaggregation of revenue
Net sales	174.7	164.3	321.2	301.0
Global Institutional and Specialty | Asia Pacific
Disaggregation of revenue
Net sales	58.4	53.0	115.2	105.7
Global Institutional and Specialty | Latin America
Disaggregation of revenue
Net sales	47.6	41.5	88.9	78.3
Global Institutional and Specialty | Greater China
Disaggregation of revenue
Net sales	40.5	28.7	76.1	68.9
Global Institutional and Specialty | India, Middle East and Africa
Disaggregation of revenue
Net sales	17.2	13.7	31.9	24.7
Global Institutional and Specialty | Product and equipment sales
Disaggregation of revenue
Net sales	1,047.2	936.3	1,968.0	1,763.3
Global Institutional and Specialty | Service and lease sales
Disaggregation of revenue
Net sales	225.0	193.0	433.0	375.4
Global Healthcare and Life Sciences
Disaggregation of revenue
Net sales	390.8	390.9	770.5	753.7
Global Healthcare and Life Sciences | North America
Disaggregation of revenue
Net sales	156.4	157.6	320.3	302.6
Global Healthcare and Life Sciences | Europe
Disaggregation of revenue
Net sales	186.1	180.7	360.5	350.8
Global Healthcare and Life Sciences | Asia Pacific
Disaggregation of revenue
Net sales	22.6	24.4	42.3	44.4
Global Healthcare and Life Sciences | Latin America
Disaggregation of revenue
Net sales	6.6	5.3	12.3	11.2
Global Healthcare and Life Sciences | Greater China
Disaggregation of revenue
Net sales	12.9	17.0	23.7	31.8
Global Healthcare and Life Sciences | India, Middle East and Africa
Disaggregation of revenue
Net sales	6.2	5.9	11.4	12.9
Global Healthcare and Life Sciences | Product and equipment sales
Disaggregation of revenue
Net sales	363.9	360.2	716.5	694.2
Global Healthcare and Life Sciences | Service and lease sales
Disaggregation of revenue
Net sales	26.9	30.7	54.0	59.5
Other
Disaggregation of revenue
Net sales	363.9	336.6	693.9	630.6
Other | North America
Disaggregation of revenue
Net sales	232.3	214.9	442.6	396.6
Other | Europe
Disaggregation of revenue
Net sales	74.1	69.7	141.3	131.8
Other | Asia Pacific
Disaggregation of revenue
Net sales	23.0	19.6	43.2	36.2
Other | Latin America
Disaggregation of revenue
Net sales	14.2	13.1	27.8	26.1
Other | Greater China
Disaggregation of revenue
Net sales	18.0	16.7	34.3	34.6
Other | India, Middle East and Africa
Disaggregation of revenue
Net sales	2.3	2.6	4.7	5.3
Other | Product and equipment sales
Disaggregation of revenue
Net sales	89.2	85.0	170.2	155.0
Other | Service and lease sales
Disaggregation of revenue
Net sales	274.7	251.6	523.7	475.6
Corporate
Disaggregation of revenue
Net sales	16.7	33.9	40.4	68.7
Corporate | North America
Disaggregation of revenue
Net sales	12.4	30.3	33.1	59.7
Corporate | Europe
Disaggregation of revenue
Net sales	1.3	0.9	2.0	1.5
Corporate | Asia Pacific
Disaggregation of revenue
Net sales	0.8	1.1	1.8	2.1
Corporate | Latin America
Disaggregation of revenue
Net sales	2.2	1.6	3.5	5.1
Corporate | Greater China
Disaggregation of revenue
Net sales				0.1
Corporate | India, Middle East and Africa
Disaggregation of revenue
Net sales				0.2
Corporate | Product and equipment sales
Disaggregation of revenue
Net sales	$ 16.7	$ 33.9	$ 40.4	68.6
Corporate | Service and lease sales
Disaggregation of revenue
Net sales				$ 0.1

XML

REVENUES - Allowance for Expected Credit Losses (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Accounts Receivable and Allowance for Doubtful Accounts
Allowance for doubtful accounts, returns and credits	$ 66.0	$ 24.9
Activity in the allowance for doubtful accounts
Beginning balance	71.9	52.8
Bad debt expense	32.5	24.8
Write-offs	(18.6)	(8.5)
Other (a)	(2.0)	3.8
Ending balance	$ 83.8	$ 72.9

XML

REVENUES - Contract Liability (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Change in contract liability
Contract liability as of beginning of the year	$ 116.5	$ 91.7
Revenue recognized in the period from: Amounts included in the contract liability at the beginning of the period	(116.5)	(91.7)
Increases due to billings excluding amounts recognized as revenue during the period ended	107.4	99.1
Contract liability as of end of period	$ 107.4	$ 99.1

XML

OPERATING SEGMENTS (Details) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($) item segment	Jun. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Financial information of reportable segments
Number of operating units | segment			10
Number of reportable segments | item			3
Net sales	$ 3,852.1	$ 3,580.6	$ 7,423.7	$ 6,847.3
Operating Income (Loss)	484.7	425.8	836.3	680.3
Previously Reported | Valued at 2022 Management Rates
Financial information of reportable segments
Net sales					$ 14,187.8
Operating Income (Loss)					1,562.5
Previously Reported | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales					14,187.8
Operating Income (Loss)					1,562.5
Global Industrial
Financial information of reportable segments
Net sales	1,808.5	1,689.9	3,517.9	3,255.6
Global Institutional and Specialty
Financial information of reportable segments
Net sales	1,272.2	1,129.3	2,401.0	2,138.7
Global Healthcare and Life Sciences
Financial information of reportable segments
Net sales	390.8	390.9	770.5	753.7
Other
Financial information of reportable segments
Net sales	363.9	336.6	693.9	630.6
Corporate
Financial information of reportable segments
Net sales	16.7	33.9	40.4	68.7
Operating segment
Financial information of reportable segments
Net sales	3,831.0	3,522.2	7,388.4	6,694.5
Operating Income (Loss)	481.4	414.8	830.4	653.3
Operating segment | Previously Reported | Valued at 2022 Management Rates
Financial information of reportable segments
Net sales					14,473.1
Operating Income (Loss)					1,612.6
Operating segment | Previously Reported | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales					14,093.4
Operating Income (Loss)					1,546.3
Operating segment | Purchase Price Adjustments | Changes in Currency Rates
Financial information of reportable segments
Net sales					(379.7)
Operating Income (Loss)					(66.3)
Operating segment | Global Industrial
Financial information of reportable segments
Net sales	1,795.6	1,653.3	3,494.9	3,164.7
Operating Income (Loss)	255.4	216.8	471.0	396.7
Operating segment | Global Industrial | Previously Reported | Valued at 2022 Management Rates
Financial information of reportable segments
Net sales					6,944.0
Operating Income (Loss)					977.0
Operating segment | Global Industrial | Previously Reported | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales					6,736.3
Operating Income (Loss)					935.8
Operating segment | Global Industrial | Purchase Price Adjustments | Changes in Currency Rates
Financial information of reportable segments
Net sales					(207.7)
Operating Income (Loss)					(42.0)
Operating segment | Global Industrial | Purchase Price Adjustments | Segment Changes
Financial information of reportable segments
Operating Income (Loss)					0.8
Operating segment | Global Institutional and Specialty
Financial information of reportable segments
Net sales	1,268.6	1,118.2	2,395.2	2,109.5
Operating Income (Loss)	208.7	148.6	334.4	257.2
Operating segment | Global Institutional and Specialty | Previously Reported | Valued at 2022 Management Rates
Financial information of reportable segments
Net sales					4,480.0
Operating Income (Loss)					634.5
Operating segment | Global Institutional and Specialty | Previously Reported | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales					4,414.3
Operating Income (Loss)					621.7
Operating segment | Global Institutional and Specialty | Purchase Price Adjustments | Changes in Currency Rates
Financial information of reportable segments
Net sales					(75.9)
Operating Income (Loss)					(11.2)
Operating segment | Global Institutional and Specialty | Purchase Price Adjustments | Segment Changes
Financial information of reportable segments
Net sales					10.2
Operating Income (Loss)					(1.6)
Operating segment | Global Healthcare and Life Sciences
Financial information of reportable segments
Net sales	387.5	384.4	766.1	732.6
Operating Income (Loss)	32.7	55.2	67.7	97.1
Operating segment | Global Healthcare and Life Sciences | Previously Reported | Valued at 2022 Management Rates
Financial information of reportable segments
Net sales					1,570.0
Operating Income (Loss)					205.0
Operating segment | Global Healthcare and Life Sciences | Previously Reported | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales					1,505.8
Operating Income (Loss)					193.3
Operating segment | Global Healthcare and Life Sciences | Purchase Price Adjustments | Changes in Currency Rates
Financial information of reportable segments
Net sales					(64.2)
Operating Income (Loss)					(9.9)
Operating segment | Global Healthcare and Life Sciences | Purchase Price Adjustments | Segment Changes
Financial information of reportable segments
Operating Income (Loss)					(1.8)
Operating segment | Other
Financial information of reportable segments
Net sales	362.6	332.5	691.9	619.3
Operating Income (Loss)	63.4	51.6	113.5	88.7
Operating segment | Other | Previously Reported | Valued at 2022 Management Rates
Financial information of reportable segments
Net sales					1,355.0
Operating Income (Loss)					212.8
Operating segment | Other | Previously Reported | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales					1,313.3
Operating Income (Loss)					209.9
Operating segment | Other | Purchase Price Adjustments | Changes in Currency Rates
Financial information of reportable segments
Net sales					(31.5)
Operating Income (Loss)					(5.5)
Operating segment | Other | Purchase Price Adjustments | Segment Changes
Financial information of reportable segments
Net sales					(10.2)
Operating Income (Loss)					2.6
Operating segment | Corporate
Financial information of reportable segments
Operating Income (Loss)	(78.8)	(57.4)	(156.2)	(186.4)
Operating segment | Corporate | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales	16.7	33.8	40.3	68.4
Operating segment | Corporate | Previously Reported | Valued at 2022 Management Rates
Financial information of reportable segments
Net sales					124.1
Operating Income (Loss)					(416.7)
Operating segment | Corporate | Previously Reported | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales					123.7
Operating Income (Loss)					(414.4)
Operating segment | Corporate | Purchase Price Adjustments | Changes in Currency Rates
Financial information of reportable segments
Net sales					(0.4)
Operating Income (Loss)					2.3
Currency impact
Financial information of reportable segments
Net sales	21.1	58.4	35.3	152.8
Operating Income (Loss)	$ 3.3	$ 11.0	$ 5.9	$ 27.0
Currency impact | Previously Reported | Valued at 2022 Management Rates
Financial information of reportable segments
Net sales					(285.3)
Operating Income (Loss)					(50.1)
Currency impact | Previously Reported | Valued at 2023 Management Rates
Financial information of reportable segments
Net sales					94.4
Operating Income (Loss)					16.2
Currency impact | Purchase Price Adjustments | Changes in Currency Rates
Financial information of reportable segments
Net sales					379.7
Operating Income (Loss)					$ 66.3

XML

COMMITMENTS AND CONTINGENCIES (Details) $ in Millions	6 Months Ended
	Jun. 30, 2023 location plaintiff	Jun. 01, 2022 USD ($)
Loss contingencies
Estimated settlement		$ 500
Environmental matters
Number of locations for environmental assessments and remediation | location	25
Nalco Holding Company ("Nalco")
Loss contingencies
Estimated settlement		30
Number of plaintiffs having claims | plaintiff	5,000
Maximum | Nalco Holding Company ("Nalco")
Loss contingencies
Estimated possible loss		520
Minimum | Nalco Holding Company ("Nalco")
Loss contingencies
Estimated possible loss		$ 152

XML

Pay vs Performance Disclosure - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ 329.7	$ 308.3	$ 563.1	$ 480.2

XML

Insider Trading Arrangements	3 Months Ended
	Jun. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Rule10b51ArrModified [Flag]	false