SPECIAL (GAINS) AND CHARGES

6 Months Ended

Jun. 30, 2025

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)	2025		2024		2025		2024
Cost of sales
One Ecolab		$2.5		$-		$7.3		$-
Other restructuring		-		0.7		-		2.3
Cost of sales subtotal		2.5		0.7		7.3		2.3
Special (gains) and charges
One Ecolab		26.5		-		65.9		-
Other restructuring		(12.0)		6.9		(12.0)		25.0
Sale of global surgical solutions business		0.8		7.3		2.4		13.3
Acquisition and integration activities		7.3		2.3		8.8		4.8
Other		2.0		(4.3)		(11.0)		(2.7)
Special (gains) and charges subtotal		24.6		12.2		54.1		40.4
Total special (gains) and charges		$27.1		$12.9		$61.4		$42.7

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

One Ecolab

On July 30, 2024, the Company announced the One Ecolab initiative, which will enhance its growth and margin expansion journey. As a program within this initiative, the Company also announced that it commenced a restructuring plan to leverage its digital technologies to realign the functional work done in many countries into global centers of excellence. The Company anticipates restructuring costs of $175 million ($136 million after tax) and special charges of $50 million ($39 million after tax) by the end of 2027. The Company anticipates that the restructuring costs will primarily be cash expenditures for severance costs relating to team reorganization.

The Company recorded restructuring charges of $17.4 million ($13.2 million after tax) and $56.8 million ($43.7 million after tax) during the second quarter and first six months of 2025, respectively, primarily related to severance. In addition, the Company recorded non-restructuring special charges of $11.6 million ($8.8 million after tax) and $16.4 million ($12.4 million after tax) during the second quarter and first six months of 2025, respectively, primarily related to professional services. The Company has recorded $138.6 million ($106.7 million after tax) of cumulative restructuring charges and $40.1 million ($30.3 million after tax) of cumulative special charges under the One Ecolab initiative.

The restructuring liability related to the One Ecolab initiative was $82.1 million and $54.9 million as of June 30, 2025 and December 31, 2024, 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 One Ecolab initiative since inception of the underlying actions includes the following items:

	Employee
	Costs		Other		Total
(millions)
2024 Activity
Recorded expense and accrual		$46.3		$30.2		$76.5
Net cash payments		-		(26.9)		(26.9)
Non-cash net charges		-		-		-
Reclassification		-		5.3		5.3
Net Restructuring liability, December 31, 2024		46.3		8.6		54.9
2025 Activity
Recorded expense (income) and accrual		$47.0		$9.8		$56.8
Net cash payments		(11.7)		(17.9)		(29.6)
Non-cash net charges		-		-		-
Reclassification		-		-		-
Net Restructuring liability, June 30, 2025		$81.6		$0.5		$82.1

Other restructuring

Other restructuring is 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 and subsequently expanded the program to focus on its Institutional and Healthcare businesses in other regions (the “Combined Program”). The restructuring activities were completed at the end of 2024, with total costs $184.1 million ($151.5 million after tax). Subsequent to the completion of the Combined Program, the Company finalized the sale of a facility, resulting in a gain of $12 million ($9.2 million after tax) in the second quarter of 2025.

The net liability related to the Combined Program was $4.4 million and $12.8 million as of June 30, 2025 and December 31, 2024, respectively. Net cash payments were $1.2 million and $8.3 million in the second quarter and first six months of 2025, 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		Other		Total
2022-2024 Activity
Recorded expense and accrual		$118.0		$15.3		$36.8		$170.1
Net cash payments		(124.5)		-		(31.5)		(156.0)
Non-cash charges		-		(15.3)		-		(15.3)
Reclassification		19.3		-		(5.3)		14.0
Net restructuring liability, December 31, 2024		12.8		-		-		12.8

Other Restructuring Activities

The restructuring liability balance for all other restructuring plans excluding the Combined Program and One Ecolab was $5.0 million and $6.5 million as of June 30, 2025 and December 31, 2024, respectively.

Sale of global surgical solutions business

On April 27, 2024, the Company reached a definitive agreement to sell its global surgical solutions business, which closed on August 1, 2024. The Company recorded charges of $0.8 million ($0.6 million after tax) and $2.4 million ($1.8 million after tax) in the second quarter and first six months of 2025, respectively. The Company recorded charges of $7.3 million ($3.1 million gain after tax) and $13.3 million ($1.4 million after tax) in the second quarter and first six months of 2024, respectively.

Acquisition and integration related costs

Acquisition and integration related costs reported in special (gains) and charges on the Consolidated Statements of Income include $7.3 million ($5.6 million after tax) and $2.3 million ($1.7 million after tax) in the second quarter of 2025 and 2024, respectively, and $8.8 million ($6.7 million after tax) and $4.8 million ($3.6 million after tax) in the first six months of 2025 and 2024, respectively.

Other operating activities

Other special gains recorded in special (gains) and charges on the Consolidated Statements of Income in the second quarter of 2025 and 2024 were $2.0 million ($1.6 million after tax) and charges of ($4.3 million) ($3.1 million gain after tax), respectively. Other special gains recorded in special (gains) and charges on the Consolidated Statements of Income in the first six months of 2025 and 2024 were $(11.0 million) ($9.7 million gain after tax) and ($2.7 million) ($2.2 million gain after tax), respectively, primarily related to the sale of an equity method investment.