Stockholders' Equity

9 Months Ended

Sep. 30, 2014

Equity [Abstract]

Stockholders' Equity

NOTE F – Stockholders’ Equity

Comprehensive Income

The components of comprehensive income are as follows:

	Three Months Ended						Nine Months Ended
	September 30						September 30
	2014			2013			2014			2013
Net income	$	371.4		$	309.4		$	964.5		$	837.1
Other comprehensive income (OCI):
Unrealized gains (losses) on derivative contracts		7.5			(3.5	)		7.9			9.8
Tax effect		(2.6	)		.8			(2.4	)		(3.3	)
		4.9			(2.7	)		5.5			6.5
Unrealized gains (losses) on marketable debt securities		1.0			.1			4.7			(5.7	)
Tax effect		(.1	)					(1.1	)		1.6
		.9			.1			3.6			(4.1	)
Pension plans		14.5			2.5			22.0			36.8
Tax effect		(4.4	)		(1.5	)		(7.0	)		(12.6	)
		10.1			1.0			15.0			24.2
Foreign currency translation (losses) gains		(278.0	)		120.4			(231.4	)		(58.2	)
Net other comprehensive (loss) income		(262.1	)		118.8			(207.3	)		(31.6	)
Comprehensive income	$	109.3		$	428.2		$	757.2		$	805.5

Accumulated Other Comprehensive (Loss) Income

The components of AOCI as of September 30, 2014 and December 31, 2013 and the changes in AOCI, net of tax, included in the Consolidated Balance Sheets, consisted of the following:

	Derivative Contracts			Marketable Debt Securities			Pension Plans			Foreign Currency Translation			Total
Balance at December 31, 2013	$	(15.1	)	$	1.7		$	(262.2	)	$	284.3		$	8.7
Recorded into AOCI		(.2	)		4.1			3.8			(231.4	)		(223.7	)
Reclassified out of AOCI		5.7			(.5	)		11.2						16.4
Net other comprehensive income (loss)		5.5			3.6			15.0			(231.4	)		(207.3	)
Balance at September 30, 2014	$	(9.6	)	$	5.3		$	(247.2	)	$	52.9		$	(198.6	)

The components of AOCI as of September 30, 2013 and December 31, 2012 and the changes in AOCI, net of tax, included in the Consolidated Balance Sheets, consisted of the following:

	Derivative Contracts			Marketable Debt Securities			Pension Plans			Foreign Currency Translation			Total
Balance at December 31, 2012	$	(27.2	)	$	6.6		$	(496.5	)	$	357.6		$	(159.5	)
Recorded into AOCI		27.3			(5.1	)		2.1			(56.2	)		(31.9	)
Reclassified out of AOCI		(20.8	)		1.0			22.1			(2.0	)		.3
Net other comprehensive income (loss)		6.5			(4.1	)		24.2			(58.2	)		(31.6	)
Balance at September 30, 2013	$	(20.7	)	$	2.5		$	(472.3	)	$	299.4		$	(191.1	)

Reclassifications out of AOCI during the nine months ended September 30, 2014 are as follows:

AOCI Components	Line Item in the Consolidated Statements of Comprehensive Income	Amount Reclassified Out of AOCI
Unrealized (gains) and losses on derivative contracts:
Truck, Parts and Other
Foreign-exchange contracts	Cost of sales and revenues	$	1.7
	Interest and other expense, net		.1
Financial Services
Interest-rate contracts	Interest and other borrowing expenses		8.0
	Pre-tax expense increase		9.8
	Tax benefit		(4.1	)
	After-tax expense increase		5.7
Unrealized (gains) and losses on marketable debt securities:
Marketable debt securities	Investment income		(.8	)
	Tax expense		.3
	After-tax income increase		(.5	)
Pension plans:
Truck, Parts and Other
Actuarial loss	Cost of sales and revenues $8.4, SG&A $6.5		14.9
Prior service costs	Cost of sales and revenues $.7, SG&A $.2		.9
Financial Services
Actuarial loss	SG&A		.8
	Pre-tax expense increase		16.6
	Tax benefit		(5.4	)
	After-tax expense increase		11.2
Total reclassifications out of AOCI		$	16.4

Reclassifications out of AOCI during the nine months ended September 30, 2013 are as follows:

AOCI Components	Line Item in the Consolidated Statements of Comprehensive Income	Amount Reclassified Out of AOCI
Unrealized (gains) and losses on derivative contracts:
Truck, Parts and Other
Foreign-exchange contracts	Cost of sales and revenues	$	(.5	)
	Interest and other expense, net		(.2	)
Financial Services
Interest-rate contracts	Interest and other borrowing expenses		(29.1	)
	Pre-tax expense reduction		(29.8	)
	Tax expense		9.0
	After-tax expense reduction		(20.8	)
Unrealized (gains) and losses on marketable debt securities:
Marketable debt securities	Investment income		1.4
	Tax benefit		(.4	)
	After-tax income reduction		1.0
Pension plans:
Truck, Parts and Other
Prior service costs	Cost of sales and revenues $.8, SG&A $.1		.9
Actuarial loss	Cost of sales and revenues $17.4, SG&A $14.2 R&D $.1		31.7
Financial Services
Actuarial loss	SG&A		1.3
	Pre-tax expense increase		33.9
	Tax benefit		(11.8	)
	After-tax expense increase		22.1
Foreign currency translation:
Truck, Parts and Other	Interest and other expense, net		(1.1	)
Financial Services	Interest and other borrowing expenses		(.9	)
	Expense reduction		(2.0	)
Total reclassifications out of AOCI		$	.3

Stock Compensation Plans

Stock-based compensation expense was $2.5 and $12.9 for the three and nine months ended September 30, 2014, respectively, and $2.7 and $11.2 for the three and nine months ended September 30, 2013, respectively. Realized tax benefits related to the excess of deductible amounts over expense recognized amounted to $.5 and $2.0 for the three and nine months ended September 30, 2014, respectively, and $1.0 and $2.5 for the three and nine months ended September 30, 2013, respectively, and have been classified as a financing cash flow.

During the first three quarters of 2014, the Company issued 541,252 common shares under deferred and stock compensation arrangements.