Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Sep. 30, 2019	Nov. 07, 2019	Mar. 29, 2019
Document and Entity Information
Title of 12(b) Security	Common Stock, without par value
Entity Incorporation, State or Country Code	IN
Entity Tax Identification Number	26-1342272
Entity Address, Address Line One	One Batesville Boulevard
Entity Address, City or Town	Batesville,
Entity Address, State or Province	IN
Entity Registrant Name	HILLENBRAND, INC.
Entity Central Index Key	0001417398
Current Fiscal Year End Date	--09-30
Entity Filer Category	Large Accelerated Filer
Entity Emerging Growth Company	false
Document Type	10-K
Document Annual Report	true
Document Period End Date	Sep. 30, 2019
Document Transition Report	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Common Stock, Shares Outstanding		62,744,927
Entity Public Float			$ 2,521,789,389
Entity File Number	001-33794
City Area Code	812
Local Phone Number	934-7500
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity Address, Postal Zip Code	47006
Trading Symbol	HI
Security Exchange Name	NYSE
Entity Small Business	false

CONSOLIDATED STATEMENTS OF INCOME - USD ($)
shares in Millions, $ in Millions

3 Months Ended

12 Months Ended

Sep. 30, 2019

Jun. 30, 2019

Mar. 31, 2019

Dec. 31, 2018

Sep. 30, 2018

Jun. 30, 2018

Mar. 31, 2018

Dec. 31, 2017

Sep. 30, 2019

Sep. 30, 2018

Sep. 30, 2017

Income Statement [Abstract]

Net revenue

$ 485.8

$ 446.6

$ 464.6

$ 410.3

$ 474.7

$ 446.0

$ 452.2

$ 397.2

$ 1,807.3

$ 1,770.1

$ 1,590.2

Cost of Goods and Services Sold

1,184.3

1,128.0

999.4

Gross profit

166.7

148.4

160.9

147.0

163.8

163.5

168.6

146.2

623.0

642.1

590.8

Operating expenses

379.7

378.9

343.5

Amortization expense

32.5

30.2

29.2

Impairment charges

0.0

63.4

0.0

Interest expense

27.4

23.3

25.2

Other (expense) income, net

(6.7)

0.2

(4.6)

Income before income taxes

176.7

146.5

188.3

Income tax expense

50.5

65.3

59.9

Consolidated net income

126.2

81.2

128.4

Less: Net income attributable to noncontrolling interests

4.8

4.6

2.2

Net income

$ 24.7

$ 30.4

$ 38.0

$ 28.3

$ 44.5

$ 35.9

$ (21.9)

$ 18.1

$ 121.4

^[1]

$ 76.6

^[1]

$ 126.2

^[1]

Net income - per share of common stock:

Basic earnings per share (in dollars per share)

$ 0.39

$ 0.48

$ 0.60

$ 0.45

$ 0.71

$ 0.57

$ (0.34)

$ 0.28

$ 1.93

^[1]

$ 1.21

^[1]

$ 1.99

^[1]

Diluted earnings per share (in dollars per share)

$ 0.39

$ 0.48

$ 0.60

$ 0.45

$ 0.70

$ 0.56

$ (0.34)

$ 0.28

$ 1.92

^[1]

$ 1.20

^[1]

$ 1.97

^[1]

Weighted-average shares outstanding-basic (in shares)

62.9

63.1

63.6

Weighted-average shares outstanding-diluted (in shares)

63.3

63.8

64.0

[1]	Net income attributable to Hillenbrand

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($)
$ in Millions

12 Months Ended

Sep. 30, 2019

Sep. 30, 2018

Sep. 30, 2017

Statement of Comprehensive Income [Abstract]

Consolidated net income

$ 126.2

$ 81.2

$ 128.4

Other comprehensive (loss) income, net of tax

Currency translation

(20.6)

(7.9)

24.9

Pension and postretirement (net of tax of $7.7, $1.3, and $10.9)

(21.3)

4.3

22.2

Net unrealized (loss) gain on derivative instruments (net of tax of $0.2, $0.0, and $1.0)

(14.5)

(0.1)

1.7

Total other comprehensive (loss) income, net of tax

(56.4)

(3.7)

48.8

Consolidated comprehensive income

69.8

77.5

177.2

Less: Comprehensive income attributable to noncontrolling interests

4.8

3.9

2.4

Comprehensive Income (Loss), Net of Tax, Attributable to Parent

^[1]

$ 65.0

$ 73.6

$ 174.8

[1]	Comprehensive income attributable to Hillenbrand

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017
Statement of Comprehensive Income [Abstract]
Pension and postretirement, tax	$ (7.7)	$ 1.3	$ (10.9)
Net unrealized (loss) gain on derivative instruments, tax	$ (3.5)	$ 0.0	$ 1.0

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Sep. 30, 2019	Sep. 30, 2018
Current Assets
Cash and cash equivalents	$ 399.0	$ 56.0
Trade receivables, net	217.4	218.5
Receivables from long-term manufacturing contracts	181.1	120.3
Inventories	176.6	172.5
Prepaid expenses	26.7	25.2
Other current assets	22.4	18.1
Total current assets	1,023.2	610.6
Property, plant, and equipment, net	140.3	142.0
Intangible assets, net	454.9	487.3
Goodwill	578.0	581.9
Other assets	32.2	42.8
Total Assets	2,228.6	1,864.6
Current Liabilities
Trade accounts payable	236.2	196.8
Liabilities from long-term manufacturing contracts and advances	158.2	125.9
Current portion of long-term debt	0.0	0.0
Accrued compensation	73.2	71.9
Other current liabilities	121.7	137.1
Total current liabilities	589.3	531.7
Long-term debt	619.5	344.6
Accrued pension and postretirement healthcare	131.3	120.5
Deferred income taxes	73.6	76.4
Other long-term liabilities	45.1	47.3
Total Liabilities	1,458.8	1,120.5
Commitments and contingencies (Note 11)
SHAREHOLDERS’ EQUITY
Common stock, no par value (63.9 and 63.9 shares issued, 62.7 and 62.3 shares outstanding)	0.0	0.0
Additional paid-in capital	345.3	351.4
Retained earnings	599.5	531.0
Treasury stock (1.2 and 1.6 shares)	(50.1)	(67.1)
Accumulated other comprehensive loss	(140.6)	(84.2)
Hillenbrand Shareholders’ Equity	754.1	731.1
Noncontrolling interests	15.7	13.0
Total Shareholders’ Equity	769.8	744.1
Total Liabilities and Equity	$ 2,228.6	$ 1,864.6

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Millions	Sep. 30, 2019	Sep. 30, 2018
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0	$ 0
Common stock, shares issued	63.9	63.8
Common stock, shares outstanding	62.3	63.1
Treasury stock, shares	1.6	0.7

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	12 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2017
Operating Activities
Consolidated net income	$ 126.2	$ 81.2	$ 128.4
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	58.5	56.5	56.6
Impairment charges	0.0	63.4	0.0
Deferred income taxes	6.7	3.7	37.1
Net loss (gain) on disposal or impairment of property	0.0	0.7	(4.6)
Equity in net loss (income) from affiliates	0.0	0.0	0.4
Share-based compensation	12.0	12.1	10.5
Trade accounts receivable and receivables on long-term manufacturing contracts	(66.2)	(13.0)	10.7
Inventories	(8.6)	(24.0)	5.4
Prepaid expenses and other current assets	(7.6)	(0.1)	(6.2)
Trade accounts payable	46.4	41.6	17.2
Liabilities from long-term manufacturing contracts and advances, accrued compensation, and other current liabilities	36.0	5.8	64.6
Income taxes payable	(9.6)	23.0	4.8
Defined benefit plan funding	(10.3)	(10.9)	(90.6)
Defined benefit plan expense	3.5	3.6	6.4
Settlement of interest rate swaps, net	(13.8)	0.0	0.0
Amortization of deferred financing costs	6.8	0.9	0.3
Other, net	(1.1)	3.8	5.2
Net cash provided by operating activities	178.9	248.3	246.2
Investing Activities
Capital expenditures	(25.5)	(27.0)	(22.0)
Proceeds from sales of property, plant, and equipment	0.2	3.7	5.7
Acquisitions of businesses, net of cash acquired	(25.9)	0.0	0.0
Return of investment capital from affiliates	0.0	0.0	3.2
Other, net	0.0	(0.1)	(0.4)
Net cash used in investing activities	(51.2)	(23.4)	(13.5)
Financing Activities
Proceeds from long-term debt, net of discount	374.4	0.0	0.0
Repayments of long-term debt	0.0	(148.5)	(13.5)
Proceeds from revolving credit facility	897.3	1,096.8	819.3
Repayments on revolving credit facility	(990.4)	(1,065.7)	(953.0)
Payment of deferred financing costs	(7.5)	(2.8)	0.0
Payment of dividends on common stock	(52.6)	(52.1)	(51.9)
Repurchases of common stock	0.0	(61.0)	(28.0)
Proceeds from stock option exercises and other	2.6	11.2	16.3
Payments for employee taxes on net settlement equity awards	(4.2)	(4.1)	(2.6)
Other, net	(2.1)	(6.3)	(1.7)
Net cash provided by (used in) financing activities	217.5	(232.5)	(215.1)
Effect of exchange rate changes on cash and cash equivalents	(2.3)	(2.7)	(3.6)
Net cash flows	342.9	(10.3)	14.0
Cash, cash equivalents, and restricted cash:
At end of period	399.0	56.0
Restricted Cash	0.4	0.5
Cash paid for interest	19.9	20.7	20.3
Cash paid for income taxes	53.3	38.9	18.2
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract]
At Beginning of Period	56.5	66.8	52.8
At End of Period	$ 399.4	$ 56.5	$ 66.8

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($)	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Treasury Stock	Accumulated Other Comprehensive Loss	Noncontrolling Interests
Balance at Sep. 30, 2016	$ 646,200,000		$ 348,700,000	$ 433,300,000	$ (19,900,000)	$ (129,800,000)	$ 13,900,000
Balance (in shares) at Sep. 30, 2016		63,700,000			700,000
Increase (Decrease) in Stockholders' Equity
Total other comprehensive loss, net of tax	48,800,000					48,600,000	200,000
Net income	128,400,000			126,200,000			2,200,000
Issuance/retirement of stock for stock awards/options	(13,700,000)		9,800,000		$ (23,500,000)
Issuance/retirement of stock for stock awards/options (in shares)		(100,000)			(700,000)
Share-based compensation	10,500,000		10,500,000
Treasury Stock, Shares, Acquired					700,000
Purchases of common stock	28,000,000.0				$ 28,000,000.0
Dividends ($0.8400 per share)	(53,700,000)		(500,000)	(52,400,000)			(1,800,000)
Balance at Sep. 30, 2017	765,900,000		349,900,000	507,100,000	$ (24,400,000)	(81,200,000)	14,500,000
Balance (in shares) at Sep. 30, 2017		63,800,000			700,000
Increase (Decrease) in Stockholders' Equity
Total other comprehensive loss, net of tax	(3,700,000)					(3,000,000.0)	(700,000)
Net income	81,200,000			76,600,000			4,600,000
Issuance/retirement of stock for stock awards/options	$ (7,100,000)		(11,200,000)		$ (18,300,000)
Issuance/retirement of stock for stock awards/options (in shares)	(500,000)	(100,000)			(500,000)
Share-based compensation	$ 12,100,000		12,100,000
Treasury Stock, Shares, Acquired					1,400,000
Purchases of common stock	61,000,000.0				$ 61,000,000.0
Dividends ($0.8400 per share)	(57,500,000)		(600,000)	(52,700,000)			(5,400,000)
Other	200,000		0				0
Balance at Sep. 30, 2018	744,100,000		351,400,000	531,000,000.0	$ (67,100,000)	(84,200,000)	13,000,000.0
Balance (in shares) at Sep. 30, 2018		63,900,000			1,600,000
Increase (Decrease) in Stockholders' Equity
Total other comprehensive loss, net of tax	(56,400,000)					(56,400,000)	0
Net income	126,200,000			121,400,000			4,800,000
Issuance/retirement of stock for stock awards/options	$ 1,600,000		(18,600,000)		$ (17,000,000.0)
Issuance/retirement of stock for stock awards/options (in shares)	(400,000)	0			(400,000)
Share-based compensation	$ 12,000,000.0		12,000,000.0
Dividends ($0.8400 per share)	(54,700,000)		(500,000)	(53,100,000)			(2,100,000)
Balance at Sep. 30, 2019	$ 769,800,000		$ 345,300,000	$ 599,500,000	$ (50,100,000)	$ (140,600,000)	$ 15,700,000
Balance (in shares) at Sep. 30, 2019		63,900,000			1,200,000

Background	12 Months Ended
Background	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Background	Background Hillenbrand, Inc. (“Hillenbrand”) is a global diversified industrial company with multiple leading brands that serve a wide variety of industries around the world. We strive to provide superior return for our shareholders, exceptional value for our customers, great professional opportunities for our employees, and to be responsible to our communities through deployment of the Hillenbrand Operating Model (“HOM”). The HOM is a consistent and repeatable framework designed to produce sustainable and predictable results. The HOM describes our mission, vision, values and mindset as leaders; applies our management practices in Strategy Management, Segmentation, Lean, Talent Development, and Acquisitions; and prescribes three steps (Understand, Focus, and Grow) designed to make our businesses both bigger and better. Our goal is to continue developing Hillenbrand as a world-class global diversified industrial company through the deployment of the HOM. Hillenbrand’s portfolio is composed of two business segments: the Process Equipment Group and Batesville^®. The Process Equipment Group businesses design, develop, manufacture, and service highly engineered industrial equipment around the world. Batesville is a recognized leader in the death care industry in North America. “Hillenbrand,” “the Company,” “we,” “us,” “our,” and similar words refer to Hillenbrand and its subsidiaries unless context otherwise requires.

Summary of Significant Accounting Policies

12 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Basis of presentation — The accompanying Consolidated Financial Statements include the accounts of Hillenbrand and its subsidiaries. They also include two subsidiaries where the Company’s ownership percentage is less than 100%. The portion of the business that is not owned by the Company is presented as noncontrolling interests within equity in the balance sheets. Income attributable to the noncontrolling interests is separately reported within the Consolidated Statements of Income. All significant intercompany accounts and transactions have been eliminated.

Use of estimates — We prepared the Consolidated Financial Statements in conformity with accounting principles generally accepted in the U.S. (“GAAP”). GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Foreign currency translation — The financial statements of our foreign subsidiaries are translated into U.S. dollars using period-end exchange rates for assets and liabilities and average exchange rates for operating results. Unrealized translation gains and losses are included in accumulated other comprehensive loss in shareholders’ equity. When a transaction is denominated in a currency other than the subsidiary’s functional currency, we recognize a transaction gain or loss in Other (expense) income, net within the Consolidated Statements of Income when the transaction is settled.

Cash and cash equivalents include short-term investments with original maturities of three months or less. The carrying amounts reported in the balance sheet for cash and cash equivalents are valued at cost, which approximates their fair value.

Trade receivables are recorded at the invoiced amount and generally do not bear interest, unless they become past due. The allowance for doubtful accounts is a best estimate of the amount of probable credit losses and collection risk in the existing accounts receivable portfolio. The allowance for cash discounts and sales returns reserve are based upon historical experience and trends. Account balances are charged against the allowance when we believe it is probable the receivable will not be recovered. We generally hold trade accounts receivable until they are collected. At September 30, 2019 and 2018, we had reserves against trade receivables of $22.8 and $22.2.

Inventories are valued at the lower of cost or market. Inventory costs are determined by the last-in, first-out (“LIFO”) method for approximately 28% and 30% of inventories at September 30, 2019 and 2018. Costs of remaining inventories have been determined principally by the first-in, first-out (“FIFO”) and average cost methods. If the FIFO method of inventory accounting, which approximates current cost, had been used for inventory accounted for using the LIFO method, that inventory would have been approximately $17.3 and $15.7 higher than reported at September 30, 2019 and 2018.



	September 30,
	2019		2018
Raw materials and components	$	72.3	$	68.3
Work in process	44.0		44.7
Finished goods	60.3		59.5
Total inventories	$	176.6	$	172.5

Property, plant, and equipment are carried at cost less accumulated depreciation. Depreciation is computed using principally the straight-line method based on estimated useful lives of three to 50 years for buildings and improvements and three to 25 years for machinery and equipment. Major improvements that extend the useful lives of such assets are capitalized while expenditures for maintenance, repairs, and minor improvements are expensed as incurred. Upon disposal or retirement, the cost and accumulated depreciation of assets are eliminated. Any gain or loss is reflected in the Company’s income from operations. We review these assets for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. An impairment loss would be recognized when estimated future undiscounted cash flows relating to the asset are less than its carrying amount. The impairment loss is measured as the amount by which the carrying amount of an asset exceeds its fair value. Total depreciation expense for 2019, 2018, and 2017 was $23.2, $23.4, and $25.4.



	September 30, 2019					September 30, 2018
	Cost		Accumulated Depreciation			Cost		Accumulated Depreciation
Land and land improvements	$	15.0	$	(3.4	)	$	15.0	$	(3.3	)
Buildings and building equipment	103.5		(64.2		)	102.3		(60.7		)
Machinery and equipment	330.8		(241.4		)	328.5		(239.8		)
Total	$	449.3	$	(309.0	)	$	445.8	$	(303.8	)

Intangible assets are stated at the lower of cost or fair value. With the exception of certain trade names, intangible assets are amortized on a straight-line basis over periods ranging from three to 21 years, representing the period over which we expect to receive future economic benefits from these assets. We assess the carrying value of trade names annually, or more often if events or changes in circumstances indicate there may be impairment. Estimated amortization expense related to intangible assets for the next five years is: $30.6 in 2020, $29.5 in 2021, $28.5 in 2022, $28.1 in 2023, and $27.9 in 2024.



	September 30, 2019					September 30, 2018
	Cost		Accumulated Amortization			Cost		Accumulated Amortization
Finite-lived assets:
Trade names	$	0.2	$	(0.2	)	$	0.2	$	(0.2	)
Customer relationships	464.2		(169.2		)	464.5		(148.4		)
Technology, including patents	76.8		(49.4		)	79.6		(45.1		)
Software	58.7		(51.7		)	58.0		(48.9		)
Other	0.2		(0.2		)	0.2		(0.2		)
	600.1		(270.7		)	602.5		(242.8		)
Indefinite-lived assets:
Trade names	125.5		—			127.6		—

Total	$	725.6	$	(270.7	)	$	730.1	$	(242.8	)

The net change in intangible assets during the year ended September 30, 2019 was driven by normal amortization and foreign currency translation, partially offset by the acquisition of BM&M in November 2018, which included intangible assets of approximately $14. See Note 4 for further detail on the acquisition of BM&M.

As a result of the required annual impairment assessment performed in the third quarter of 2019, the fair value of trade names was determined to meet or exceed the carrying value for all trade names, resulting in no impairment to trade names during the year ended September 30, 2019.

An impairment charge of $4.6 pre-tax ($3.5 after tax) was recorded during the year ended September 30, 2018 for trade names most directly impacted by domestic coal mining and coal power. See discussion of Goodwill below for further information on the impairment charge.

Goodwill is not amortized, but is subject to annual impairment tests. Goodwill has been assigned to reporting units. We assess the carrying value of goodwill annually, or more often if events or changes in circumstances indicate there may be impairment. Impairment testing is performed at a reporting unit level.



	Process Equipment Group			Batesville		Total
Balance September 30, 2017	$	639.2		$	8.3	$	647.5
Impairment charge	(58.8		)	—		(58.8		)
Foreign currency adjustments	(6.8		)	—		(6.8		)
Balance September 30, 2018	573.6			8.3		581.9
Acquisitions, including purchase price adjustments	12.4			—		12.4
Foreign currency adjustments	(16.3		)	—		(16.3		)
Balance September 30, 2019	$	569.7		$	8.3	$	578.0

As a result of the required annual impairment assessment performed in the third quarter of 2019, the Company tested the recoverability of its goodwill, and in all reporting units, the fair value of goodwill was determined to exceed the carrying value, resulting in no impairment of goodwill.

In connection with the preparation of the quarterly financial statements for the second quarter of 2018, an interim impairment assessment was performed at the reporting unit most directly impacted by domestic coal mining and coal power. During the quarter ended March 31, 2018, published industry reports reduced their forecasts for domestic coal production and consumption. The reporting unit also experienced a larger than expected decline in orders for equipment and parts used in the domestic coal mining and coal power industries. In conjunction with these events and as part of the long-term strategic forecasting process, the Company made the decision to redirect strategic investments for growth, significantly reducing the reporting unit’s terminal growth rate. As a result of this change in expected future cash flows, along with comparable fair value information, management concluded that the reporting unit carrying value exceeded its fair value, resulting in a goodwill impairment charge of $58.8 during the year ended September 30, 2018.

Environmental liabilities — Expenditures that relate to an existing condition caused by past operations which do not contribute to current or future revenue generation are expensed. A reserve is established when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These reserves are determined without consideration of possible loss recoveries. Based on consultations with an environmental engineer, the range of liability is estimated based on current interpretations of environmental laws and regulations. A determination is made of the specific measures that are believed to be required to remediate the site, the estimated total cost to carry out the remediation plan, and the periods in which we will make payments toward the remediation plan. We do not make an estimate of inflation for environmental matters because the number of sites is relatively small, we believe the magnitude of costs to execute remediation plans is not significant, and the estimated time frames to remediate sites are not believed to be lengthy.

Specific costs included in environmental expense and reserves include site assessment, remediation plan development, clean-up costs, post-remediation expenditures, monitoring, fines, penalties, and legal fees. The amount reserved represents the expected undiscounted future cash outflows associated with such plans and actions and we believe is not significant to Hillenbrand.

Self-insurance — We are self-funded up to certain limits for product and general liability, workers compensation, and auto liability insurance programs, as well as certain employee health benefits including medical, drug, and dental. Claims covered by insurance have in most instances deductibles and self-funded retentions up to $0.5 per occurrence, depending upon the type of coverage and policy period. Our policy is to estimate reserves for product and general liability, workers compensation, and auto liability based upon a number of factors, including known claims, estimated incurred but not reported claims, and outside actuarial analysis. The outside actuarial analysis is based on historical information along with certain assumptions about future events. These reserves are classified as Other current liabilities and Other long-term liabilities within the Consolidated Balance Sheets.

Treasury stock consists of our common shares that have been issued but subsequently reacquired. We account for treasury stock purchases under the cost method. When these shares are reissued, we use an average-cost method to determine cost. Proceeds in excess of cost are credited to additional paid-in capital.

In December 2018, the Board of Directors authorized a new share repurchase program of up to $200.0 in replacement of the Company’s prior share repurchase program, which eliminated the balance of approximately $39.6 remaining under that prior authorization. The repurchase program has no expiration date but may be terminated by the Board of Directors at any time. Share repurchases under the program are classified as treasury stock. We made no repurchases of our common stock during 2019. We repurchased approximately 1,385,600 shares of our common stock during 2018, at a total cost of $61.0. In 2019 and 2018, approximately 400,000 shares and 500,000 shares were issued from treasury stock under our stock compensation programs. At September 30, 2019, we had $200.0 remaining for share repurchases under the existing Board authorization.

Preferred stock — The Company has authorized 1,000,000 shares of preferred stock (no par value), of which no shares were issued at September 30, 2019 and 2018.

Accumulated other comprehensive loss includes all changes in Hillenbrand shareholders’ equity during the period except those that resulted from investments by or distributions to our shareholders.



	September 30,
	2019			2018
Currency translation	$	(64.7	)	$	(44.1	)
Pension and postretirement (net of taxes of $30.0 and $22.3)	(62.3		)	(41.0		)
Unrealized (loss) gain on derivative instruments (net of taxes of $0.7 and $0.3)	(13.6		)	0.9
Accumulated other comprehensive loss	$	(140.6	)	$	(84.2	)

Revenue recognition — Effective October 1, 2018, we adopted Accounting Standards Codification (“ASC”) 606 under the modified retrospective transition approach. See Note 3 for our policy for recognizing revenue under ASC 606 as well as the various other disclosures required by ASC 606.

For the years ended September 30, 2018 and 2017, revenue continues to be presented based on prior guidance. Under such guidance, net revenue included gross revenue less sales discounts, customer rebates, sales incentives, and product returns, all of which require us to make estimates for the portion of these allowances that have yet to be credited or paid to our customers. We estimated these allowances based upon historical rates and projections of customer purchases toward contractual rebate thresholds.

A portion of Hillenbrand’s revenue was derived from long-term manufacturing contracts. The majority of this revenue was recognized based on the percentage-of-completion method. Under this method, revenue is recognized based upon the costs incurred to date as compared to the total estimated project costs. Approximately 25% of Hillenbrand’s revenue was attributable to these long-term manufacturing contracts for both 2018 and 2017.

Accounting for these contracts involves management judgment in estimating total contract revenue and cost. Contract revenues are largely determined by negotiated contract prices and quantities, modified by our assumptions regarding contract options, change orders, and incentive and award provisions associated with technical performance clauses. Contract costs are incurred over longer periods of time and, accordingly, the estimation of these costs requires management judgment. Cost estimates are largely based on negotiated or estimated purchase contract terms, historical performance trends, and other economic projections. Significant factors that influence these estimates include inflationary trends, technical and schedule risk, internal and subcontractor performance trends, business volume assumptions, asset utilization, and anticipated labor agreements. Revenue and cost estimates are regularly monitored and revised based on changes in circumstances. Anticipated losses on long-term contracts are recognized immediately when such losses become evident. We maintain financial controls over the customer qualification, contract pricing, and estimation processes to seek to reduce the risk of contract losses.

Revenue for components, most replacement parts, and service is recognized when title and risk of loss passes to the customer.

Cost of goods sold consists primarily of purchased material costs, fixed manufacturing expense, variable direct labor, and overhead costs. It also includes costs associated with the distribution and delivery of products.

Research and development costs are expensed as incurred as a component of operating expenses and were $10.6, $11.7, and $11.9 for 2019, 2018, and 2017.

Warranty costs — We provide for the estimated warranty cost of a product at the time revenue is recognized. Warranty expense is accrued based upon historical information and may also include specific provisions for known conditions. Warranty obligations are affected by actual product performance and by material usage and service costs incurred in making product corrections. Our

warranty provision takes into account the best estimate of amounts necessary to settle future and existing claims on products sold. The Process Equipment Group generally offers a one- to two-year warranty on a majority of its products. It engages in extensive product quality programs and processes in an effort to minimize warranty obligations, including active monitoring and evaluation of the quality of component suppliers. Warranty reserves were $17.1 and $16.9 for 2019 and 2018. Warranty costs were $3.4, $3.3, and $4.1 for 2019, 2018, and 2017.

Income taxes — On December 22, 2017, the U.S. government enacted the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). The Tax Act made broad and complex changes to the U.S. tax code, some of which went into effect during our fiscal year ended September 30, 2018 including, but not limited to (a) a reduction of the U.S. federal corporate tax rate from 35% to 21%, (b) a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries (“Transition Tax”), and (c) immediate expensing of certain capital expenditures. Since the effective date of the reduced tax rate was January 1, 2018, our fiscal year ended September 30, 2018 had a prorated U.S. federal corporate tax rate of 24.5%. In addition to the 21% tax rate, other key provisions of the Tax Act, such as the repeal of the Domestic Production Activities Deduction, imposition of tax on Global Intangible Low-Taxed Income (GILTI) earned by certain foreign subsidiaries, the Foreign Derived Intangible Income Deduction (FDII), and the Base Erosion and Anti-Abuse Tax (BEAT) went into effect in our fiscal year ended September 30, 2019. A company can elect to either recognize deferred taxes or provide tax expense in the year GILTI is incurred. The Company has elected to account for GILTI in the year the tax is incurred.

We establish deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the Consolidated Financial Statements. Deferred tax assets and liabilities are determined in part based on the differences between the accounting treatment of tax assets and liabilities under GAAP and the tax basis of assets and liabilities using statutory tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in statutory tax rates on deferred tax assets and liabilities is recognized in net income in the period that includes the enactment date. We continue to assert that most of the cash at our foreign subsidiaries represents earnings considered to be permanently reinvested for which deferred taxes have not been recorded in our Consolidated Financial Statements, as we do not intend, nor do we foresee a need, to repatriate these funds. We continue to actively evaluate our global capital deployment and cash needs.

We have a variety of deferred income tax assets in numerous tax jurisdictions. The recoverability of these deferred income tax assets is assessed periodically and valuation allowances are recognized if it is determined that it is more likely than not that the benefits will not be realized. When performing this assessment, we consider future taxable income, the reversal of existing temporary differences, and tax planning strategies. We account for accrued interest and penalties related to unrecognized tax benefits in income tax expense.

Derivative financial instruments — The Company has hedging programs in place to manage its currency exposures. The objectives of our hedging programs are to mitigate exposures in gross margin and non-functional-currency-denominated assets and liabilities. Under these programs, we use derivative financial instruments to manage the economic impact of fluctuations in currency exchange rates. These include foreign currency exchange forward contracts, which generally have terms up to 24 months. Additionally, the Company periodically enters into interest rate swaps to manage or hedge the risks associated with our indebtedness and interest payments. Our objectives in using these swaps are to add stability to interest expense and to manage our exposure to interest rate movements.

We measure all derivative instruments at fair value and report them on our balance sheets as assets or liabilities. Changes in the fair value of derivatives are accounted for depending on the intended use of the derivative, designation of the hedging relationship, and whether or not the criteria to apply hedge accounting has been satisfied. If a derivative is designated as a fair value hedge, the gain or loss on the derivative and the offsetting loss or gain on the hedged asset or liability are recognized in earnings. For derivative instruments designated as a cash flow hedge, the effective portion of the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income and reclassified to earnings in the same period that the hedged transaction affects earnings. The portion of the gain or loss that does not qualify for hedge accounting is immediately recognized in earnings.

The aggregate notional amount of all derivative instruments was $128.9 and $152.6 at September 30, 2019 and 2018. The carrying value of all of our derivative instruments at fair value resulted in assets of $2.5 and $1.9 (included in other current assets and other assets) and liabilities of $2.6 and $2.2 (included in other current liabilities) at September 30, 2019 and 2018. See Note 13 for additional information on the fair value of our derivative instruments.

Foreign currency derivatives

Contracts designated as cash flow hedges for customer orders or intercompany purchases have an offsetting tax-adjusted amount in Accumulated other comprehensive loss. Foreign exchange contracts intended to manage foreign currency exposures within our balance sheet have an offsetting amount recorded in “Other (expense) income, net”. The cash flows from such hedges are presented in the same category in the Company’s Consolidated Statement of Cash Flows as the items being hedged.

Interest rate swap contracts

During the first quarter of 2019, the Company entered into interest rate swap contracts to hedge the interest rate associated with the forecasted issuance of $150.0 ten-year, fixed-rate debt. In September 2019, we issued $375.0 of senior unsecured notes (the “2019 Notes” as defined in Note 5) with a term of seven years. As a result of this issuance, Hillenbrand terminated and settled the interest rate swap contracts for a cash payment of $20.2.

Upon the issuance of the 2019 Notes, Hillenbrand determined that it was probable that the originally forecasted issuance of ten-year, fixed-rate debt would not occur. As a result, the Company accelerated the release of accumulated other comprehensive loss related to the missed forecasted transaction, resulting in a loss on settlement of $6.4. The loss on settlement was recorded within Other (expense) income, net, on the Consolidated Statements of Income. The remaining $13.8 is classified within Accumulated other comprehensive loss and will be amortized into Interest expense over the seven-year term of the 2019 Notes. The Company expects to reclassify amounts of $2.0 out of Accumulated other comprehensive loss into Interest expense over the next twelve months related to these interest rate swap contracts.

During the year ended September 30, 2018, we entered into interest rate swap contracts on $50.0 of outstanding borrowings under the Revolver (as defined in Note 5) in order to manage exposure to our variable interest payments. We terminated these interest rate swaps in the fourth quarter of 2018. As a result, a gain on settlement of $2.3 was released from Accumulated other comprehensive loss to Other (expense) income, net.

Business acquisitions and related business acquisition, development, and integration costs — Assets and liabilities associated with business acquisitions are recorded at fair value, using the acquisition method of accounting. We allocate the purchase price of acquisitions based upon the fair value of each component, which may be derived from observable or unobservable inputs and assumptions. We may utilize third-party valuation specialists to assist us in this allocation. Initial purchase price allocations are preliminary and subject to revision within the measurement period, generally not to exceed one year from the date of acquisition.

Business acquisition, development, and integration costs are expensed as incurred and are reported as a component of Cost of goods sold, Operating expenses, and Other (expense) income, net, depending on the nature of the cost. We define these costs to include finder’s fees, advisory, legal, accounting, valuation, and other professional or consulting fees, as well as travel associated with investigating opportunities (including acquisition and disposition). Business acquisition, development, and integration costs also include costs associated with acquisition tax planning, retention bonuses, and related integration costs. These costs exclude the ongoing expenses of our business development department.

Restructuring costs may occur when we take action to exit or significantly curtail a part of our operations or change the deployment of assets or personnel. A restructuring charge can consist of an impairment or accelerated depreciation of affected assets, severance costs associated with reductions to the workforce, costs to terminate an operating lease or contract, and charges for legal obligations for which no future benefit will be derived.

Recently adopted accounting standards — In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. ASU 2017-12 intends to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The amendments expand and refine hedge accounting for both nonfinancial and financial risk components, and align the recognition and presentation of the effects of the hedging instrument and the hedged item in the Consolidated Financial Statements. In addition, this ASU makes certain targeted improvements to simplify the application of hedge accounting guidance. ASU 2017-12 was early adopted for our fiscal year beginning on October 1, 2018 on a prospective basis. The adoption of this standard did not have a significant impact on our Consolidated Financial Statements.

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows: Restricted Cash. ASU 2016-18 requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total

amounts shown on the statement of cash flows. ASU 2016-18 became effective and was adopted for our fiscal year beginning on October 1, 2018. The adoption of ASU 2016-18 had a financial statement presentation and disclosure impact only.

In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment. ASU 2017-04 eliminates Step 2 from the goodwill impairment test and modifies the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its implied fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value. We early adopted this standard for fiscal year 2018. See Critical Accounting Estimates within this Form 10-K for further information on the impact this adoption had on our consolidated results of operations, financial position, and cash flows.

In January 2017, the FASB issued ASU 2017-01, Clarifying the Definition of a Business. ASU 2017-01 assists entities in determining whether a transaction involves an asset or a business. Specifically, it states that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or group of similar identifiable assets, the set is not a business. If this initial test is not met, a set cannot be considered a business unless it includes an input and a substantive process that together significantly contribute to the ability to create output. ASU 2017-01 became effective and was adopted for our fiscal year beginning on October 1, 2018. The adoption of ASU 2017-01 did not have a significant impact on our Consolidated Financial Statements.

In March 2017, the FASB issued ASU 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU 2017-07 states that an employer must report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period and present the other components of net benefit cost (as defined in paragraphs 715-30-35-4 and 715-60-35-9) in the income statement separately from the service cost component and outside a subtotal of income from operations (if one is presented). In addition, ASU 2017-07 limits the capitalization of compensation costs to the service cost component only (if capitalization is appropriate). ASU 2017-07 became effective and was adopted for our fiscal year beginning on October 1, 2018. On the Consolidated Statements of Income, the adoption of this standard resulted in the reclassification of $0.8 credit from Cost of goods sold to Other (expense) income, net, for the year ended September 30, 2018, and $0.5 credit from Cost of goods sold and $0.9 from Operating expenses to Other (expense) income, net, for the year ended September 30, 2017.

In May 2017, the FASB issued ASU 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. ASU 2017-09 clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications (in accordance with Topic 718). The new guidance will provide relief to entities that make non-substantive changes to share-based payment awards. ASU 2017-09 became effective and was adopted for our fiscal year beginning on October 1, 2018. The adoption of ASU 2017-09 did not have a significant impact on our Consolidated Financial Statements.

Beginning in 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (“ASC 606”), plus a number of related ASUs designed to clarify and interpret ASC 606. The new standard requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new standard supersedes U.S. GAAP guidance on revenue recognition and requires the use of more estimates than the previously effective standards. It also requires significant disclosures sufficient to enable users to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including qualitative and quantitative disclosures about contracts with customers, significant judgments and changes in judgments, and assets recognized from the costs to obtain or fulfill a contract. The new standard became effective for our fiscal year beginning on October 1, 2018 and was adopted on a modified retrospective basis. The Company elected the practical expedient and only evaluated contracts for which substantially all revenue had not been recognized under ASC Topic 605, with the cumulative effect of the new guidance recorded as of the date of initial application.

The primary changes from the adoption of ASC 606 resulted from certain performance obligations that were previously recognized at a point in time that are now recognized over time. The cumulative effect of the changes made to the Consolidated Balance Sheet as of October 1, 2018 for the adoption of ASC 606 was as follows:



	Balance at September 30, 2018		Adjustments due to ASC 606			Balance at October 1, 2018
Assets
Receivables from long-term manufacturing contracts	$	120.3	$	1.9		$	122.2
Inventories	172.5		(1.6		)	170.9

Liabilities
Deferred income taxes	$	76.4	$	0.1		$	76.5

Shareholders’ Equity
Retained earnings	$	531.0	$	0.2		$	531.2

The following tables summarize the impacts of adopting ASC 606 on the Company’s Consolidated Financial Statements as of and for the year ended September 30, 2019.

Consolidated Statements of Income:



	Year Ended September 30, 2019
	As Reported		Adjustments Due to ASC 606		Balances without Adoption
Net revenue	$	1,807.3	$	—	$	1,807.3
Cost of goods sold	1,184.3		—		1,184.3
Gross profit	623.0		—		623.0
Income before income taxes	176.7		—		176.7
Consolidated net income	126.2		—		126.2

Consolidated Balance Sheet:



	September 30, 2019
	As Reported		Adjustments Due to ASC 606			Balances without Adoption
Assets
Receivables from long-term manufacturing contracts	$	181.1	$	(1.9	)	$	179.2
Inventories	176.6		1.7			178.3

Liabilities
Deferred income taxes	$	73.6	$	—		$	73.6

Shareholders’ Equity
Retained earnings	$	599.5	$	(0.2	)	$	599.3

The Company has elected the following as a result of adopting the new standard on revenue recognition:


•	Hillenbrand elected not to adjust the promised amount of consideration for the effects of the time value of money for contracts in which the anticipated period between when Hillenbrand transfers the goods or services to the customer and when the customer pays is equal to one year or less.


•	Hillenbrand elected to account for shipping and handling activities that occur after the customer has obtained control of a good as fulfillment activities rather than as a promised service.


•	Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, and that are collected by the Company from a customer, are excluded from revenue.

Recently issued accounting standards — In February 2016, the FASB issued ASU 2016-02, Leases. ASU 2016-02 requires lessees to recognize a right of use asset and related lease liability for leases that have terms of more than twelve months. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance, with the classifications based on criteria that are similar to those applied under the current lease guidance, without the explicit bright lines. The FASB has also issued several updates to ASU 2016-02. ASU 2016-02 is effective for our fiscal year beginning on October 1, 2019. The Company plans to utilize the optional transition method to use the effective date as the date of initial application on transition. At transition, the Company has elected the package of practical expedients to not reassess prior conclusions related to contracts containing leases, lease classification, and initial direct costs. The new standard also provides practical expedients for an entity’s ongoing accounting. We will elect the short-term lease recognition exemption for all leases that qualify and we expect to elect the practical expedient to not separate lease and non-lease components for all of our leases.

We have developed a project plan for implementation, surveyed our businesses, assessed our portfolio of leases, and compiled a central repository of all leases. Additionally, we have identified and implemented appropriate changes to policies, procedures and controls pertaining to existing and future lease arrangements to support recognition and disclosure requirements under the new standard. Although we are still finalizing our evaluation of the impact of the new lease accounting guidance, we expect to recognize $120.0 to $140.0 in right-of-use assets and lease liabilities in the Consolidated Balance Sheet upon adoption.

In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Statements. ASU 2016-13 replaces the current incurred loss impairment model with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to determine credit loss estimates. ASU 2016-13 will be effective for our fiscal year beginning on October 1, 2020. We are currently evaluating the impact that ASU 2016-13 will have on our Consolidated Financial Statements.

Revenue Recognition

12 Months Ended

Sep. 30, 2019

Revenue Recognition [Abstract]

Revenue from Contract with Customer [Text Block]

Revenue Recognition

We adopted ASC 606, Revenue from Contracts with Customers, on October 1, 2018. As a result, we have changed our accounting policy for revenue recognition as detailed below.

Net revenue includes gross revenue less sales discounts, customer rebates, sales incentives, and product returns, all of which require us to make estimates for the portion of these allowances that have yet to be credited or paid to our customers. We estimate these allowances using the expected value method, which is based upon historical rates and projections of customer purchases toward contractual rebate thresholds.

Performance Obligations & Contract Estimates

The Process Equipment Group designs, engineers, manufactures, markets, and services differentiated process and material handling equipment and systems for a wide variety of industries. A large portion of our revenue across the Process Equipment Group is derived from manufactured equipment, which may be standard, customized to meet customer specifications, or turnkey.

Our contracts with customers in the Process Equipment Group segment often include multiple performance obligations. Performance obligations are promises in a contract to transfer a distinct good or service to the customer, and are the basis for determining how revenue is recognized. For instance, a contract may include obligations to deliver equipment, installation services, and spare parts. We frequently have contracts for which the equipment and the installation services, as well as highly engineered or specialized spare parts, are all considered a single performance obligation, as in these instances the installation services and/or spare parts are not separately identifiable. However, due to the varying nature of equipment and contracts across the Process Equipment Group, we also have contracts where the installation services and/or spare parts are deemed to be separately identifiable and therefore deemed to be distinct performance obligations.

A contract’s transaction price is allocated to each distinct performance obligation based on its respective standalone selling price, and recognized as revenue when, or as, the performance obligation is satisfied. When a distinct performance obligation is not sold separately, the value of the standalone selling price is estimated considering all reasonably available information. When an obligation is distinct, as defined in ASC 606, we allocate a portion of the contract price to the obligation and recognize it separately from the other performance obligations.

The timing of revenue recognition for each performance obligation is either over time or at a point in time. We recognize revenue over time for long-term manufacturing contracts that have an enforceable right to collect payment for performance completed to

date upon customer cancellation and provide one or more of the following: (i) service over a period of time, (ii) highly customized equipment, or (iii) parts which are highly engineered and have no alternative use. Revenue generated from standard equipment and highly-customized equipment or parts contracts without an enforceable right to payment for performance completed to date, as well as non-specialized parts sales and sales of death care products, is recognized at a point in time.

We use the input method of “cost-to-cost” to recognize revenue over time for long-term manufacturing contracts. Accounting for these contracts involves management judgment in estimating total contract revenue and cost. Contract revenues are largely determined by negotiated contract prices and quantities, modified by our assumptions regarding contract options, change orders, and incentive and award provisions associated with technical performance clauses. Contract costs are incurred over longer periods of time and, accordingly, the estimation of these costs requires judgment. We measure progress based on costs incurred to date relative to total estimated cost at completion. Incurred cost represents work performed, which corresponds with, and we believe thereby best depicts, the transfer of control to the customer. Contract costs include labor, material, and certain overhead expenses. Cost estimates are based on various assumptions to project the outcome of future events, including labor productivity and availability, the complexity of the work to be performed, the cost of materials, and the performance of subcontractors. Significant factors that influence these estimates include inflationary trends, technical and schedule risk, internal and subcontractor performance trends, business volume assumptions, asset utilization, and anticipated labor agreements. Revenue and cost estimates are regularly monitored and revised based on changes in circumstances. Anticipated losses on long-term contracts are recognized immediately when such losses become evident. We maintain financial controls over the customer qualification, contract pricing, and estimation processes to seek to reduce the risk of contract losses.

Standalone service revenue is recognized either over time proportionately over the period of the underlying contract or as invoiced, depending on the terms of the arrangement. Standalone service revenue is not material to the Company.

For the Process Equipment Group and Batesville segment products where revenue is recognized at a point in time, we recognize revenue when our customers take control of the asset. We define this as the point in time at which the customer has the capability of full beneficial use of the asset per the contract.

Contract balances

In the Process Equipment Group segment, the Company requires an advance deposit based on the terms and conditions of contracts with customers for many of its contracts. Payment terms generally require an upfront payment at the start of the contract, and the remaining payments during the contract or within a certain number of days of delivery. Typically, revenue is recognized within one year of receiving an advance deposit. For contracts where an advance payment is received greater than one year from expected revenue recognition, or a portion of the payment due extends beyond one year, the Company has determined it does not constitute a significant financing component.

The timing of revenue recognition, billings, and cash collections can result in customer receivables, advance payments, and billings in excess of revenue recognized. Customer receivables include amounts billed and currently due from customers and are included in Trade receivables, net, as well as unbilled amounts (contract assets) which are included in Receivables from long-term manufacturing contracts on our Consolidated Balance Sheets. Amounts are billed in accordance with contractual terms or as work progresses in accordance with contractual terms. Unbilled amounts arise when the timing of billing differs from the timing of revenue recognized, such as when contract provisions require specific milestones to be met before a customer can be billed. Unbilled amounts primarily relate to performance obligations satisfied over time when the cost-to-cost method is used and the revenue recognized exceeds the amount billed to the customer as there is not yet a right to payment in accordance with contractual terms. Unbilled amounts are recorded as a contract asset when the revenue associated with the contract is recognized prior to billing and derecognized when billed in accordance with the terms of the contract. Trade receivables are recorded at face amounts and represent the amounts we believe to be collectible. The Company maintains allowances for doubtful accounts for estimated losses as a result of customers’ inability to make required payments. Management evaluates the aging of the customer receivable balances, the financial condition of its customers, historical trends and the time outstanding of specific balances to estimate the amount of customer receivables that may not be collected in the future, and records the appropriate provision.

Advance payments and billings in excess of revenue recognized are included in Liabilities from long-term manufacturing contracts and advances on our Consolidated Balance Sheets. Advance payments and billings in excess of revenue recognized represent contract liabilities and are recorded when customers remit contractual cash payments in advance of us satisfying performance obligations under contractual arrangements, including those with performance obligations satisfied over time. Billings in excess of revenue recognized primarily relate to performance obligations satisfied over time when the cost-to-cost method is used and revenue cannot yet be recognized as the Company has not completed the corresponding performance obligation. Contract liabilities are derecognized when revenue is recognized and the performance obligation is satisfied.

The balance in Receivables from long-term manufacturing contracts at September 30, 2019 and 2018 was $181.1 and $120.3. The change was driven by the adoption of ASC 606 ($1.9) and the impact of net revenue recognized prior to billings ($58.9). The balance in the Liabilities from long-term manufacturing contracts and advances at September 30, 2019 and 2018 was $158.2 and $125.9 and consists primarily of cash payments received or due in advance of satisfying our performance obligations. The revenue recognized for the year ended September 30, 2019 related to Liabilities from long-term manufacturing contracts and advances as of September 30, 2018 was $110.6. During the year ended September 30, 2019, the adjustments related to performance obligations satisfied in previous periods were immaterial.

Costs incurred to obtain a customer contract are not material to the Company. The Company elected to apply the practical expedient to not capitalize contract costs to obtain contracts with a duration of one year or less, which are expensed as incurred.

Transaction price allocated to the remaining performance obligations

As of September 30, 2019, the aggregate amount of transaction price of remaining performance obligations, which corresponds to backlog, as defined in Part II, Item 7 of this Form 10-K, for the Company was $863.5. Approximately 85% of these obligations are expected to be satisfied over the next twelve months, and the remaining performance obligations, primarily within one to three years.

Disaggregation of revenue



	Year Ended September 30, 2019
	Process Equipment Group		Batesville		Total
Revenue by End Market
Plastics	$	785.7	$	—	$	785.7
Chemicals	111.6		—		111.6
Food & Pharmaceuticals	81.0		—		81.0
Minerals & Mining	83.2		—		83.2
Water & Wastewater	32.7		—		32.7
Death Care	—		532.9		532.9
Other	180.2		—		180.2
Total	$	1,274.4	$	532.9	$	1,807.3



	Year Ended September 30, 2019
	Process Equipment Group		Batesville		Total
Products and Services
Equipment	$	862.2	$	—	$	862.2
Parts and Services	412.2		—		412.2
Death Care	—		532.9		532.9
Total	$	1,274.4	$	532.9	$	1,807.3



	Year Ended September 30, 2019
	Process Equipment Group		Batesville		Total
Timing of Transfer
Point in Time	$	681.3	$	532.9	$	1,214.2
Over Time	593.1		—		593.1
Total	$	1,274.4	$	532.9	$	1,807.3

Business Acquisitions	12 Months Ended
Business Acquisitions	Sep. 30, 2019
Acquisitions
Mergers, Acquisitions and Dispositions Disclosures [Text Block]	Business Acquisitions We incurred $16.6 and $3.5 of business acquisition and integration costs during fiscal 2019 and fiscal 2018, which were recorded within Operating expenses on the Consolidated Statements of Income. The costs incurred during 2019 were largely attributable to the proposed acquisition of Milacron discussed below. BM&M We completed the acquisition of Burnaby Machine and Mill Equipment Ltd. (“BM&M”) in November 2018 for $25.9 in cash, which included post-closing working capital adjustments. We used the Revolver (as defined in Note 5) to fund the acquisition. Based in Canada, BM&M provides high-speed gyratory screeners for a variety of industries. The results of BM&M are reported in the Process Equipment Group segment. Based on our purchase price allocation, we recorded $12 million of goodwill and $14 of intangible assets, which consisted of $10 of customer relationship, $1 of trade names, and $3 of backlog. Goodwill is not deductible for tax purposes. The fair value of this acquisition did not ascribe a significant amount to tangible assets, as we often seek to acquire companies with a relatively low physical asset base in order to limit the need to invest significant additional cash post-acquisition. Proposed Acquisition of Milacron On July 12, 2019, we entered into a definitive agreement (the “Merger Agreement”) to acquire Milacron Holdings Corp. (“Milacron”) in a cash and stock merger transaction valued at approximately $2 billion, including debt, net of cash on hand. The proposed transaction, which is expected to close in the fourth calendar quarter of 2019, is subject to customary closing conditions, including the approval of stockholders of Milacron, which is scheduled to be sought at a special meeting on November 20, 2019. Under the terms of the Merger Agreement, upon closing Milacron stockholders will receive $11.80 in cash and a fixed exchange ratio of 0.1612 shares of Hillenbrand common stock for each share of Milacron common stock they own. See Note 5 for discussion of the financing that Hillenbrand has secured to fund the proposed acquisition.

Financing Agreements

12 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Financing Agreements



	September 30,
	2019		2018
$375 senior unsecured notes, net of discount ⁽¹⁾	$	370.1	$	—
$150 senior unsecured notes, net of discount ⁽²⁾	149.7		149.3
$100 Series A Notes ⁽³⁾	99.7		99.6
$900 revolving credit facility (excluding outstanding letters of credit)	—		95.7
Total debt	619.5		344.6
Less: current portion	—		—
Total long-term debt	$	619.5	$	344.6

(1) Includes debt issuance costs of $4.3 at September 30, 2019.

(2) Includes debt issuance costs of $0.2 and $0.4 at September 30, 2019 and September 30, 2018.

(3) Includes debt issuance costs of $0.3 and $0.4 at September 30, 2019 and September 30, 2018.

The following table summarizes the scheduled maturities of long-term debt for 2020 through 2024:



	Amount
2020 ⁽¹⁾	$	150.0
2021	—
2022	—
2023	—
2024	—

(1) These notes are classified as Long-term debt within the Consolidated Balance Sheets. See below for further information.

Third Amended and Restated Credit Agreement

The Company has in place a revolving credit facility of up to $900 (which may be expanded, subject to the approval of the lenders, by an additional $450) in an aggregate principal amount (the “Revolver”). The Revolver is governed by the Third Amended and Restated Credit Agreement dated August 28, 2019 and subsequently amended on October 8, 2019 (the “Credit Agreement”), by and among the Company and certain of its affiliates, the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent, which amended and restated in its entirety the Company’s Second Amended and Restated Credit Agreement. The Credit Agreement extended the maturity date of the Revolver to August 28, 2024 and provided for two new term loans (undrawn at September 30, 2019) in aggregate principal amounts of up to $500 and $225 (the “Term Loan Facilities”). New deferred financing costs related to the Revolver were $1.1, which along with existing unamortized costs of $2.0, are being amortized to interest expense over the remaining term of the Revolver.

Borrowings under the Revolver bear interest at variable rates plus a margin amount based upon our leverage. There is also a facility fee based upon our leverage. All borrowings under the Revolver mature upon expiration, and are therefore classified as Long-term debt in the Consolidated Balance Sheets. The Revolver is an unsubordinated obligation of Hillenbrand and ranks equally in right of payment with all our other existing and future unsubordinated obligations.

With respect to the Revolver, as of September 30, 2019, we had $7.1 in outstanding letters of credit issued and $892.9 of maximum borrowing capacity, all of which was immediately available based on our most restrictive covenant at September 30, 2019. The weighted-average interest rates on borrowings under the Revolver were 2.54%, 1.83%, and 1.40% for 2019, 2018, and 2017. The weighted average facility fee was 0.12%, 0.15%, and 0.23% for 2019, 2018, and 2017.

The lenders’ commitments to advance term loans to the Company under the Term Loan Facilities are subject to customary closing conditions, including the concurrent closing of the Company’s previously announced acquisition of Milacron, as contemplated by the Agreement and Plan of Merger (the “Merger Agreement”), dated as of July 12, 2019, by and among the Company, Milacron, and Bengal Delaware Holding Corporation. The proceeds of the Term Loan Facilities will be used solely to pay a portion of the consideration payable in connection with proposed acquisition of Milacron, fees and expenses related to the proposed acquisition, and to repay certain indebtedness of Milacron and its subsidiaries on closing of the proposed acquisition.

Once borrowed, the $500 term loan will mature on the fifth anniversary of the date on which it is borrowed, subject to quarterly amortization payments (equal to 5% of the original principal amount of the term loan in each of years 1 and 2, 7.5% in each of years 3 and 4, and 10% in year 5) and the $225 term loan will mature on the third anniversary of the date on which it is borrowed, subject to quarterly amortization payments (equal to 5% of the original principal amount of the term loan in each of years 1 and 2, and 7.5% in year 3). The term loan commitments will bear a ticking fee of 0.15% on the amount of the commitments commencing 60 days after the signing dates (August 28, 2019 for the $500 term loan and October 8, 2019 for the $225 term loan) until the date the term loans are funded or the commitments under the Term Loan Facilities are terminated. The $500 term loan will, once borrowed, accrue interest, at the Company’s option, at the LIBO Rate or the Alternate Base Rate (each as defined in the Credit Agreement) plus a margin based on the Company’s leverage ratio, ranging from 1.00% to 1.75% for term loans bearing interest at the LIBO Rate and 0.0% to 0.75% for term loans bearing interest at the Alternate Base Rate. The $225 term loan will, once borrowed, accrue interest, at the Company’s option, at the LIBO Rate or the Alternate Base Rate (each as defined in the Credit Agreement) plus a margin based on the Company’s leverage ratio, ranging from 0.875% to 1.625% for term loans bearing interest at the LIBO Rate and 0.0% to 0.625% for term loans bearing interest at the Alternate Base Rate.

Second Amended and Restated Credit Agreement

On December 8, 2017, the Company entered into a Second Amended and Restated Credit Agreement (the “Second Amended and Restated Credit Agreement”), which was amended and restated in its entirety on August 28, 2019 by the Credit Agreement. The Second Amended and Restated Credit Agreement extended the Company’s former credit agreement, which provided for a revolving credit facility of up to $700.0 in aggregate principal amount and a term loan in an original principal amount of $180.0. Additionally, the Second Amended and Restated Credit Agreement increased the maximum principal amount available for borrowing under the Revolver from $700.0 to $900.0. In connection with the Second Amended and Restated Credit Agreement, the Company repaid the prior $180.0 term loan in full with borrowings under the Revolver. The weighted-average interest rate on the prior $180.0 term loan was 2.60% for 2018.

Senior Unsecured Notes

On September 25, 2019, the Company issued $375.0 of senior unsecured notes due September 2026 (“2019 Notes”). The 2019 Notes bear interest at a fixed rate of 4.5% per year, payable semi-annually in arrears beginning March 2020. The 2019 Notes were issued at a discount of $0.6, resulting in an initial carrying value of $374.4. We are amortizing the discount to interest expense

over the term of the 2019 Notes using the effective interest rate method, resulting in an annual interest rate of 4.53%. Deferred financing costs associated with the 2019 Notes of $4.3 are being amortized to interest expense on a straight-line basis over the term of the 2019 Notes. The 2019 Notes are unsubordinated obligations of Hillenbrand and rank equally in right of payment with all of our other existing and future unsubordinated obligations. In conjunction with the issuance of the 2019 Notes, we terminated our interest rate swaps associated with the forecasted debt issuance. See Note 2 for further information on the termination of interest rate swaps.

In July 2010, the Company issued $150 of senior unsecured notes (“2010 Notes” and, together with the 2019 Notes, the “Notes”) due July 2020. The 2010 Notes bear interest at a fixed rate of 5.5% per year, payable semi-annually in arrears beginning January 2011. The 2010 Notes were issued at a discount of $1.6, resulting in an initial carrying value of $148.4. We are amortizing the discount to interest expense over the term of the 2010 Notes using the effective interest rate method, resulting in an annual interest rate of 5.65%. Unamortized deferred financing costs associated with the 2010 Notes of $0.2 are being amortized to interest expense on a straight-line basis over the remaining term of the 2010 Notes. The 2010 Notes are unsubordinated obligations of Hillenbrand and rank equally in right of payment with all of our other existing and future unsubordinated obligations. Upon maturity in July 2020, the Company expects to refinance the 2010 Notes on a long-term basis. The Company has the intent and believes it has the ability to refinance the 2010 Notes due to expected available borrowing capacity under the Revolver, although the financing source ultimately used to refinance the 2010 Notes may be different. As such, these obligations continue to be classified as Long-term debt within the Consolidated Balance Sheets.

Subject to certain limitations, in the event of a change of control (as defined in the 2010 Notes and in the indenture governing the 2019 Notes), the Company will be required to make an offer to purchase the applicable Notes at a price equal to 101% of the principal amount of such Notes, plus accrued and unpaid interest, if any, to but excluding the date of repurchase. Additionally, if the Company does not consummate the acquisition of Milacron, on or prior to July 6, 2020 or, if prior to such date, the Merger Agreement is terminated, the 2019 Notes will be subject to a special mandatory redemption at a price equal to 101% of the aggregate principal amount of the 2019 Notes, plus accrued and unpaid interest on the 2019 Notes to, but not including, the special mandatory redemption date (as defined in the indenture governing the 2019 Notes). In addition, both the 2010 Notes and 2019 Notes are redeemable with prior notice at a price equal to par plus accrued interest and a make-whole amount.

Senior Unsecured Bridge Facility

The Company entered into a commitment letter on July 12, 2019, pursuant to which JPMorgan Chase Bank, N.A. committed to fully provide a 364-day senior unsecured bridge facility (the “Bridge Facility”) in an aggregate principal amount of $1.1 billion. The commitments under the Bridge Facility commitment letter were reduced to zero upon the issuance of the 2019 Notes and with the commitments for the term loans under the Term Loan Facilities, and the Bridge Facility commitment letter was terminated. Deferred financing costs related to the Bridge Facility were $5.6, which were fully amortized to interest expense during the year ended September 30, 2019.

Series A Notes

On December 15, 2014, we issued $100.0 in 4.60% Series A unsecured notes (“Series A Notes”) pursuant to the Private Shelf Agreement, dated as of December 6, 2012 (as amended, the “Shelf Agreement”), among the Company, Prudential Investment Management, Inc. (“Prudential”) and each Prudential Affiliate (as defined therein) that became a purchaser thereunder. The Series A Notes are unsecured, mature on December 15, 2024, and bear interest at 4.60% payable semi-annually in arrears. The Company may at any time upon providing notice, prepay all or part of the Series A Notes at 100% of the principal amount prepaid plus a make-whole amount (as defined in the Shelf Agreement). Unamortized deferred financing costs of $0.3 related to the Series A Notes are being amortized to interest expense over the remaining term of the Series A Notes.

On December 19, 2014, March 24, 2016, December 8, 2017, and September 4, 2019, the Company and certain of the Company’s domestic subsidiaries entered into amendments to the Shelf Agreement. The latest amendment conformed certain terms of the Shelf Agreement with those contained in the Credit Agreement. The Shelf Agreement governs our Series A Notes, but our ability to issue new notes under the Shelf Agreement expired in March 2019.

L/G Facility Agreement

On March 8, 2018, the Company entered into the €150.0 Syndicated Letter of Guarantee Facility Agreement by and among the Company and certain of its affiliates, the lenders party thereto, and Commerzbank Finance & Covered Bond S.A., acting as agent (the “L/G Facility Agreement”). The L/G Facility Agreement permits the Company and certain of its subsidiaries to request that one or more of the participating lenders issue up to an aggregate of €150.0 in unsecured letters of credit, bank guarantees or other surety bonds (collectively, the “Guarantees”). On September 4, 2019, the Company and certain of its subsidiaries entered into an

Amendment and Restatement Agreement (the “L/G Amendment”), which amends the L/G Facility Agreement. The L/G Amendment aligns certain covenants, definitions and other provisions in the L/G Facility Agreement with those under the Credit Agreement.

The Guarantees carry an annual fee that varies based on the Company’s leverage ratio. The L/G Facility Agreement also provides for a leverage-based commitment fee assessed on the undrawn portion of the facility. The L/G Facility Agreement matures in December 2022 but can be extended or terminated earlier under certain conditions. Unamortized deferred financing costs associated with the L/G Facility Agreement of $1.1 are being amortized to interest expense over the term of the L/G Facility Agreement.

In the normal course of business, the Process Equipment Group provides to certain customers bank guarantees and other credit arrangements in support of performance, warranty, advance payment, and other contractual obligations. This form of trade finance is customary in the industry and, as a result, we maintain adequate capacity to provide the guarantees. As of September 30, 2019, we had credit arrangements totaling $305.7, under which $252.2 was utilized for this purpose. These arrangements included the facilities under the L/G Facility Agreement and other ancillary credit facilities.

Covenants related to current Hillenbrand financing agreements

The Credit Agreement, the L/G Facility Agreement, and the Shelf Agreement contain the following financial covenants: a maximum ratio of consolidated indebtedness (which excludes the 2019 Notes until the Milacron acquisition is consummated or the Merger Agreement is terminated) to EBITDA (as further defined in the agreements, “Leverage Ratio”) of 3.5 to 1.0 including the application of cash as a reduction of Indebtedness (subject to certain limitations); a maximum Leverage Ratio resulting from an acquisition in excess of $75.0 of 4.0 to 1.0 for a period of three consecutive quarters following such acquisition; and a minimum ratio of EBITDA (as defined in the agreements) to interest expense of 3.0 to 1.0. Additionally, the Credit Agreement, the L/G Facility Agreement, and the Shelf Agreement provide the Company with the ability to sell assets and to incur debt at our international subsidiaries under certain conditions.

All obligations of the Company arising under the Credit Agreement, the 2010 Notes and 2019 Notes, the Shelf Agreement, the Series A Notes, and the L/G Facility Agreement are fully and unconditionally, jointly and severally, guaranteed by certain of the Company’s domestic subsidiaries.

The Credit Agreement, the Shelf Agreement and the L/G Facility Agreement each contain certain other customary covenants, representations and warranties and events of default. The indentures governing both the 2010 Notes and 2019 Notes do not limit our ability to incur additional indebtedness. They do, however, contain certain covenants that restrict our ability to incur secured debt and to engage in certain sale and leaseback transactions. The indentures also contain customary events of default. The indentures provide holders of the Notes with remedies if we fail to perform specific obligations. As of September 30, 2019, we were in compliance with all covenants and there were no events of default.

Retirement Benefits

12 Months Ended

Sep. 30, 2019

Defined Benefit Plan [Abstract]

Retirement Benefits

Defined Benefit Retirement Plans — Approximately 38% of our employees participate in one of four defined benefit retirement programs, including the master defined benefit retirement plan in the U.S., the defined benefit plans of our German and Swiss subsidiaries, and the supplemental executive defined benefit retirement plan. We fund the pension trusts in compliance with ERISA or local funding requirements and as necessary to provide for current service and for any unfunded projected future benefit obligations over a reasonable period. The benefits for these plans are based primarily on years of service and the employee’s level of compensation during specific periods of employment. All pension plans have a September 30 measurement date.

Effect on Operations — The components of net pension costs under defined benefit retirement plans were:



	U.S. Pension Benefits Year Ended September 30,									Non-U.S. Pension Benefits Year Ended September 30,
	2019			2018			2017			2019			2018			2017
Service cost	$	2.3		$	2.7		$	3.6		$	1.2		$	1.4		$	1.3
Interest cost	9.8			8.7			8.8			1.2			1.1			0.7
Expected return on plan assets	(13.3		)	(14.0		)	(13.7		)	(0.5		)	(0.6		)	(0.5		)
Amortization of unrecognized prior service cost, net	0.1			0.2			0.4			0.1			0.1			0.1
Amortization of actuarial loss	1.2			3.2			3.6			0.9			0.7			1.1
Settlement expense	0.2			—			0.1			0.4			—			0.6
Net pension costs	$	0.3		$	0.8		$	2.8		$	3.3		$	2.7		$	3.3

We use a full yield curve approach in the estimation of the service and interest cost components of our defined benefit retirement plans. Under this approach, we applied discounting using individual spot rates from a yield curve composed of the rates of return on several hundred high-quality, fixed income corporate bonds available at the measurement date. These spot rates align to each of the projected benefit obligations and service cost cash flows. The service cost component relates to the active participants in the plan, so the relevant cash flows on which to apply the yield curve are considerably longer in duration on average than the total projected benefit obligation cash flows, which also include benefit payments to retirees. Interest cost is computed by multiplying each spot rate by the corresponding discounted projected benefit obligation cash flows. The full yield curve approach reduces any actuarial gains and losses based upon interest rate expectations (e.g. built-in gains in interest cost in an upward sloping yield curve scenario), or gains and losses merely resulting from the timing and magnitude of cash outflows associated with our benefit obligations. We use the full yield curve approach to improve the correlation between projected benefit cash flows and the corresponding yield curve spot rates and to provide a more precise measurement of service and interest rate costs.

During 2019, we completed all negotiations to transition our U.S. employees not covered by a collective bargaining agreement and our employees covered by collective bargaining agreements at our U.S. facilities from a defined benefit-based model to a defined contribution structure over three-year sunset periods, the latest of which ends January 1, 2023. These changes caused remeasurements for the U.S. defined benefit pension plan for the affected populations as they were implemented. The remeasurements did not cause material changes, as the assumptions did not materially differ from the assumptions prior to the remeasurements.

Obligations and Funded Status — The change in benefit obligation and funded status of the Company’s defined benefit retirement plans were:



	U.S. Pension Benefits September 30,						Non-U.S. Pension Benefits September 30,
	2019			2018			2019			2018
Change in benefit obligation:
Projected benefit obligation at beginning of year	$	267.0		$	281.8		$	126.3		$	133.4
Service cost	2.3			2.7			1.2			1.4
Interest cost	9.8			8.7			1.2			1.1
Actuarial (gain) loss	37.1			(14.7		)	22.6			0.4
Benefits paid	(14.1		)	(11.5		)	(5.7		)	(5.2		)
Gain due to settlement	(1.7		)	—			(2.2		)	(3.4		)
Employee contributions	—			—			0.9			0.9
Effect of exchange rates on projected benefit obligation	—			—			(6.5		)	(2.3		)
Projected benefit obligation at end of year	300.4			267.0			137.8			126.3

Change in plan assets:
Fair value of plan assets at beginning of year	253.3			262.4			31.9			31.4
Actual return on plan assets	39.6			0.6			1.5			(0.1		)
Employee and employer contributions	1.8			1.8			8.6			9.0
Benefits paid	(14.1		)	(11.5		)	(5.7		)	(5.2		)
Gain due to settlement	—			—			(2.2		)	(3.0		)
Effect of exchange rates on plan assets	—			—			(0.6		)	(0.2		)
Fair value of plan assets at end of year	280.6			253.3			33.5			31.9

Funded status:
Plan assets less than benefit obligations	$	(19.8	)	$	(13.7	)	$	(104.3	)	$	(94.4	)

Amounts recorded in the consolidated balance sheets:
Prepaid pension costs, non-current	$	7.7		$	12.0		$	—		$	2.2
Accrued pension costs, current portion	(2.0		)	(2.0		)	(6.0		)	(6.6		)
Accrued pension costs, long-term portion	(25.5		)	(23.7		)	(98.3		)	(90.0		)
Plan assets greater (less) than benefit obligations	$	(19.8	)	$	(13.7	)	$	(104.3	)	$	(94.4	)

Net actuarial losses ($94.9) and prior service costs ($0.5), less an aggregate tax effect ($31.1), are included as components of accumulated other comprehensive loss at September 30, 2019. Net actuarial losses ($67.2) and prior service costs ($0.8), less an aggregate tax effect ($24.0), are included as components of accumulated other comprehensive loss at September 30, 2018. The amount that will be amortized from accumulated other comprehensive loss into net pension costs in 2020 is expected to be $7.3.

Accumulated Benefit Obligation — The accumulated benefit obligation for all defined benefit retirement plans was $433.6 and $387.0 at September 30, 2019 and 2018. Selected information for plans with accumulated benefit obligations in excess of plan assets was:



	U.S. Pension Benefits September 30,				Non-U.S. Pension Benefits September 30,
	2019		2018		2019		2018
Projected benefit obligation	$	27.4	$	25.7	$	102.3	$	96.6
Accumulated benefit obligation	27.4		25.7		102.3		96.6
Fair value of plan assets	—		—		—		—

The weighted-average assumptions used in accounting for defined benefit retirement plans were:



	U.S. Pension Benefits Year Ended September 30,						Non-U.S. Pension Benefits Year Ended September 30,
	2019		2018		2017		2019		2018		2017
Discount rate for obligation, end of year	3.1	%	4.2	%	3.7	%	0.3	%	1.2	%	1.1	%
Discount rate for expense, during the year	4.1	%	3.4	%	3.5	%	1.5	%	1.5	%	0.5	%
Expected rate of return on plan assets	5.2	%	5.6	%	5.6	%	1.5	%	2.0	%	2.0	%
Rate of compensation increase	3.0	%	3.0	%	3.0	%	2.0	%	2.0	%	2.0	%

The discount rates are evaluated annually based on current market conditions. In setting these rates, we utilize long-term bond indices and yield curves as a preliminary indication of interest rate movements, then make adjustments to the indices to reflect differences in the terms of the bonds covered under the indices in comparison to the projected outflow of pension obligations. The overall expected long-term rate of return is based on historical and expected future returns, which are inflation-adjusted and weighted for the expected return for each component of the investment portfolio. The rate of assumed compensation increase is also based on our specific historical trends of past wage adjustments in recent years.

U.S. Pension Plan Assets — Long-term strategic investment objectives utilize a diversified mix of equity and fixed income securities to preserve the funded status of the trusts and balance risk and return. The primary investment strategy is a dynamic target allocation method that periodically rebalances among various investment categories depending on the current funded position. This program is designed to actively move from return-seeking investments (such as equities) toward liability-hedging investments (such as long-duration fixed income) as funding levels improve. The target investment in return-seeking assets may vary from 60% to 20% of total plan assets based on the plan’s funding level. Plan assets are invested by the plans’ fiduciaries, which direct investments according to specific policies. Those policies subject investments to the following restrictions in our domestic plan: short-term securities must be rated A1/P1, liability-hedging fixed income securities must have an average quality credit rating of investment grade and investments in equities in any one company may not exceed 10% of the equity portfolio.

Non-U.S. Pension Plan Assets — Long-term strategic investment objectives utilize a diversified mix of suitable assets of appropriate liquidity to generate income and capital growth that, together with contributions from participants and Hillenbrand, we believe will meet the cost of the current and future benefits that the plan provides. Long-term strategic investment objectives also seek to limit the risk of the assets failing to meet the liabilities over the long term.

None of Hillenbrand’s common stock was directly owned by the pension plan trusts at September 30, 2019.

The tables below provide the fair value of our pension plan assets by asset category at September 30, 2019 and 2018. The accounting guidance on fair value measurements specifies a fair value hierarchy based upon the observability of inputs used in valuation techniques (Level 1, 2, and 3). See Note 13 for definitions.

Fair values are determined as follows:


•	Cash equivalents are stated at the carrying amount, which approximates fair value, or at the fund’s net asset value.


•	Equity securities are stated at the last reported sales price on the day of valuation.


•	Government index funds are stated at the closing price reported in the active market in which the fund is traded.


•	Corporate bond funds and equity mutual funds are stated at the closing price in the active markets in which the underlying securities of the funds are traded.


•	Real estate is stated based on a discounted cash flow approach, which includes future rental receipts, expenses, and residual values as the highest and best use of the real estate from a market participant view as rental property.

U.S. Pension Plans

The plan assets of our U.S. pension plans consist of certain investments that are measured at fair value using the net asset value per share (or its equivalent) as a practical expedient. Accordingly, these assets are not required to be classified and reported under the fair value hierarchy. At September 30, 2019 and 2018, the fair values of these investments were $280.6 and $253.3.

Non-U.S. Pension Plans



	Fair Value at September 30, 2019 Using Inputs Considered as:
	Total		Level 1		Level 2		Level 3
Non-U.S. Pension Plans
Cash equivalents	$	4.3	$	4.3	$	—	$	—
Equity securities	7.5		7.5		—		—
Other types of investments:
Government index funds	5.7		5.7		—		—
Corporate bond funds	11.0		11.0		—		—
Real estate and real estate funds	2.4		—		—		2.4
Other	2.6		—		2.6		—
Total Non-U.S. pension plan assets	$	33.5	$	28.5	$	2.6	$	2.4



	Fair Value at September 30, 2018 Using Inputs Considered as:
	Total		Level 1		Level 2		Level 3
Non-U.S. Pension Plans
Cash equivalents	$	2.4	$	2.4	$	—	$	—
Equity securities	7.3		7.3		—		—
Other types of investments:	0		0		0		0
Government index funds	5.6		5.6		—		—
Corporate bond funds	12.1		12.1		—		—
Real estate and real estate funds	2.4		—		—		2.4
Other	2.1		—		2.1		—
Total Non-U.S. pension plan assets	$	31.9	$	27.4	$	2.1	$	2.4

Cash Flows — During 2019, 2018, and 2017 we contributed cash of $9.3, $10.0, and $89.6 to our defined benefit pension plans. We expect to make estimated contributions of $9.3 in 2020 to our pension plans. Due to the funded status of our U.S. defined benefit pension plan, we do not expect to make contributions to this plan in 2020.

Estimated Future Benefit Payments — The following represents estimated future benefit payments, including expected future service, which are expected to be paid from plan assets or Company contributions as necessary:



	U.S. Pension Plans Projected Pension Benefits Payout		Non-U.S. Pension Plans Projected Pension Benefits Payout
2020	$	14.5	$	7.2
2021	14.8		6.9
2022	15.5		7.0
2023	15.9		7.1
2024	16.2		7.1
2025-2029	83.8		32.1

Defined Contribution Plans — We sponsor a number of defined contribution plans. Depending on the plan, we may make contributions up to 4% of an employee’s eligible compensation and matching contributions up to 6% of eligible compensation. Company contributions generally vest over a period of zero to three years. Expenses related to our defined contribution plans were $11.6, $11.3, and $11.4 for 2019, 2018, and 2017. See comments above regarding our retirement strategy to transition our U.S. employees to a defined contribution structure over three-year sunset periods, the latest of which ends January 1, 2023.

Postretirement Healthcare Plan — The Company offers a domestic postretirement healthcare plan that provides healthcare benefits to eligible qualified retirees and their spouses. The plan includes retiree cost-sharing provisions and generally extends retiree coverage for medical, prescription, and dental benefits beyond the COBRA continuation period to the date of Medicare eligibility. We use a measurement date of September 30. The net postretirement healthcare benefit for 2019 was $0.1, cost for 2018 was $0.1, and cost for 2017 was $0.3.



	September 30,
	2019			2018
Benefit obligation at beginning of year	$	7.6		$	9.0
Interest cost	0.3			0.2
Service cost	0.2			0.3
Actuarial (gain) loss	1.0			(0.9		)
Net benefits paid	(0.9		)	(1.0		)
Benefit obligation at end of year	$	8.2		$	7.6

Amounts recorded in the balance sheets:
Accrued postretirement benefits, current portion	$	0.7		$	0.8
Accrued postretirement benefits, long-term portion	7.5			6.8
Net amount recognized	$	8.2		$	7.6

The weighted-average assumptions used in revaluing our obligation under the postretirement healthcare plan were:



	Year Ended September 30,
	2019		2018		2017
Discount rate for obligation	2.8	%	4.0	%	3.3	%
Healthcare cost rate assumed for next year	6.9	%	7.1	%	7.6	%
Ultimate trend rate	4.5	%	4.5	%	4.5	%

Net actuarial gains of $2.6 and $4.0 and prior service costs of $0.5 and $0.7, less tax of $1.1 and $1.7, were included as a component of accumulated other comprehensive loss at September 30, 2019 and 2018. The estimated amount that will be amortized from accumulated other comprehensive loss as a reduction to postretirement healthcare costs in 2020 is $0.4. A one percentage-point increase or decrease in the assumed healthcare cost trend rates as of September 30, 2019, would cause no increase or decrease in service and interest costs, but would cause an increase or decrease in the benefit obligation of $0.6.

We fund the postretirement healthcare plan as benefits are paid. Current plan benefits are expected to require net Company contributions for retirees of $0.7 per year for the foreseeable future.

Income Taxes

12 Months Ended

Sep. 30, 2019

Income Tax Disclosure [Abstract]

Income Taxes

On December 22, 2017, the U.S. government enacted the Tax Act. The Tax Act makes broad and complex changes to the U.S. tax code that impacted our fiscal years 2019 and 2018 by, among other things, (a) reducing the U.S. federal corporate tax rate, (b) implementing the Transition Tax, and (c) accelerating expensing of certain capital expenditures. The Tax Act reduced the federal corporate tax rate from 35% to 21%. The Internal Revenue Code stipulates that our fiscal year ending September 30, 2018 had a blended corporate tax rate of 24.5%, which is based on a proration of the applicable tax rates before and after the effective date of the Tax Act. The statutory tax rate of 21% applied to our fiscal year ended September 30, 2019 and future years.



	Year Ended September 30,
	2019			2018			2017
Domestic	$	44.1		$	33.7		$	108.2
Foreign	132.6			112.8			80.1
Total earnings before income taxes	$	176.7		$	146.5		$	188.3

Income tax expense:
Current provision:
Federal	$	11.1		$	38.2		$	0.5
State	4.5			6.7			(0.4		)
Foreign	28.2			16.7			22.7
Total current provision	43.8			61.6			22.8

Deferred provision (benefit):
Federal	(3.8		)	(7.5		)	32.0
State	(0.2		)	0.5			5.0
Foreign	10.7			10.7			0.1
Total deferred provision (benefit)	6.7			3.7			37.1
Income tax expense	$	50.5		$	65.3		$	59.9



	Year Ended September 30,
	2019		2018		2017
Federal statutory rates	21.0	%	24.5	%	35.0	%
Adjustments resulting from the tax effect of:
State income taxes, net of federal benefit	1.6		2.4		1.6
Foreign income tax rate differential	4.1		(0.6	)	(5.8	)
Domestic manufacturer’s deduction	—		(1.2	)	(0.3	)
Share-based compensation	(1.2	)	(1.6	)	(1.1	)
Foreign distribution taxes	1.0		(1.7	)	2.7
Valuation allowance	(0.4	)	(0.7	)	(1.3	)
Goodwill impairment charge	—		11.2		—
Transition tax	—		17.8		—
Deferred tax impact of rate change	—		(9.4	)	—
Unrecognized tax benefits	1.9		2.1		—
Other, net	0.6		1.8		1.0
Effective income tax rate	28.6	%	44.6	%	31.8	%



	September 30,
	2019			2018
Deferred tax assets:
Employee benefit accruals	$	40.6		$	29.0
Loss and tax credit carryforwards	11.3			23.1
Interest limitation carryforward	18.3			14.2
Rebates and other discounts	4.5			4.4
Self-insurance reserves	2.1			2.5
Inventory, net	2.8			2.0
Other, net	15.1			8.5
Total deferred tax assets before valuation allowance	94.7			83.7
Less valuation allowance	(0.9		)	(1.8		)
Total deferred tax assets, net	93.8			81.9
Deferred tax liabilities:
Depreciation	(10.8		)	(8.3		)
Amortization	(105.0		)	(105.3		)
Long-term contracts and customer prepayments	(46.8		)	(38.9		)
Unremitted earnings of foreign operations	(1.2		)	(0.5		)
Other, net	(0.9		)	(1.8		)
Total deferred tax liabilities	(164.7		)	(154.8		)
Deferred tax liabilities, net	$	(70.9	)	$	(72.9	)

Amounts recorded in the balance sheets:
Deferred tax assets, non-current	2.7			3.5
Deferred tax liabilities, non-current	(73.6		)	(76.4		)
Total	$	(70.9	)	$	(72.9	)

We recorded a tax benefit of $13.7 at September 30, 2018, for the remeasurement of the deferred tax items to reflect the impact of the U.S. corporate tax rate reduction to 21%. At September 30, 2019, we had $1.7 of deferred tax assets related to U.S. federal and state net operating losses and tax credit carryforwards, which will begin to expire in 2020, and $27.9 of deferred tax assets related to foreign net operating loss and interest carryforwards. The majority of the foreign net operating loss and interest carryforwards have unlimited carryforward periods. Portions of the net operating loss carryforwards with expiration periods will begin to expire in 2020. Deferred tax assets as of September 30, 2019 and 2018, were reduced by a valuation allowance of $0.9 and $1.8 relating to foreign net operating loss carryforwards and foreign tax credit carryforwards. At September 30, 2019 and 2018, we had $10.2 and $19.5 of current income tax payable included in other current liabilities on our Consolidated Balance Sheets. At both September 30, 2019 and 2018, the current liability was $2.0, representing the second and first installment payments of the Transition Tax liability, which is payable over eight years. As of September 30, 2019 and 2018, we also had a Transition Tax liability of $20.9 and $22.6 included within Other long-term liabilities on our Consolidated Balance Sheets.

We establish a valuation allowance for deferred tax assets when it is determined that the amount of expected future taxable income is not likely to support the use of the deduction or credit.

As of September 30, 2019, and 2018, we had approximately $310.2 and $321.7 of undistributed retained earnings from our foreign subsidiaries. Historically, U.S. federal and state income taxes have not been recorded on accumulated undistributed retained earnings of substantially all our foreign subsidiaries, as these earnings were considered permanently reinvested. However, upon enactment of the Tax Act, the undistributed retained earnings of our foreign subsidiaries are subject to U.S. tax due to the Transition Tax. As a result, we recognized a provisional transition tax liability of $24.6 during the quarter ended December 31, 2017. This amount was adjusted during the year ended September 30, 2019, to a tax liability of $24.9.

As of September 30, 2019, and 2018, $1.2 and $0.5 of deferred tax liability on unremitted earnings of foreign subsidiaries was recognized, representing the assumed tax on the future distribution and tax withholdings on the distribution of such earnings among certain of our foreign subsidiaries. As of September 30, 2019, a current tax liability of $0.8 was recognized for taxes on distributions expected to be made in the next fiscal year.

Deferred tax liabilities were not recorded for any additional basis differences inherent in our foreign subsidiaries (i.e., basis differences in excess of those subject to the Transition Tax) as these amounts continue to be permanently reinvested outside of the US. If these amounts were not considered permanently reinvested, deferred tax liabilities would be recorded for any additional income taxes, distribution taxes, and withholding taxes payable in various countries. A determination of the unrecognized deferred tax liabilities on the permanently reinvested basis differences at September 30, 2019 is not practicable.

A reconciliation of the unrecognized tax benefits is as follows:



	September 30,
	2019			2018			2017
Balance at September 30	$	12.1		$	9.9		$	7.7
Additions for tax positions related to the current year	0.3			0.3			0.7
Additions for tax positions of prior years	4.0			2.8			3.4
Reductions for tax positions of prior years	(0.4		)	(0.6		)	(1.5		)
Settlements	(6.3		)	(0.3		)	(0.4		)
Balance at September 30	$	9.7		$	12.1		$	9.9

The gross unrecognized tax benefit included $9.7 and $12.1 at September 30, 2019 and 2018, which, if recognized, would impact the effective tax rate in future periods.

We recognize accrued interest and penalties related to unrecognized tax benefits as income tax expense. During 2019 and 2018, we recognized $0.4 and $0.9 in additional interest and penalties. Excluded from the reconciliation were $0.7 and $2.0 of accrued interest and penalties at September 30, 2019 and 2018.

We operate in multiple income tax jurisdictions both inside and outside the U.S. and are currently under examination in various federal, state, and foreign jurisdictions. Specifically, we are currently under examination in the U.S. for 2018. We recently completed the tax authority examination of our German operations for the 2009 through 2013 tax years. The German examination resulted in the reduction of tax attribute carryforwards and cash taxes offset by the reduction of valuation allowances and utilizations of reserves for uncertain tax position. In addition, there are other ongoing audits in various stages of completion in several state and foreign jurisdictions.

It is possible that the liability associated with the unrecognized tax benefits will increase or decrease within the next 12 months. These changes may be the result of ongoing audits or the expiration of statutes of limitations and could range up to $2.5 based on current estimates. Audit outcomes and the timing of audit settlements are subject to significant uncertainty. Although we believe that adequate provision has been made for such issues, it is possible that their ultimate resolution could affect our earnings. Conversely, if these issues are resolved favorably in the future, the related provision would be reduced and yield a positive impact on earnings. We do not expect that the outcome of these audits will significantly impact the Consolidated Financial Statements.

Earnings Per Share

12 Months Ended

Sep. 30, 2019

Earnings Per Share [Abstract]

Earnings Per Share

Earnings per Share

The dilutive effects of performance-based stock awards described in Note 9 are included in the computation of diluted earnings per share at the level the related performance criteria are met through the respective balance sheet date. At September 30, 2019, 2018, and 2017, potential dilutive effects, representing 400,000, 400,000, and 600,000 shares were excluded from the computation of diluted earnings per share as the related performance criteria were not yet met, although we expect to meet various levels of criteria in the future.



	Year Ended September 30,
	2019		2018		2017
Net income⁽¹⁾	$	121.4	$	76.6	$	126.2
Weighted average shares outstanding — basic (in millions)	62.9		63.1		63.6
Effect of dilutive stock options and unvested time-based restricted stock (in millions)	0.4		0.7		0.4
Weighted average shares outstanding — diluted (in millions)	63.3		63.8		64.0

Earnings per share — basic	$	1.93	$	1.21	$	1.99
Earnings per share — diluted	$	1.92	$	1.20	$	1.97

Shares with anti-dilutive effect excluded from the computation of diluted earnings per share (millions)	0.8		0.3		0.4

(1) Net income attributable to Hillenbrand

Share-Based Compensation

12 Months Ended

Sep. 30, 2019

Share-Based Compensation

We have share-based compensation plans under which 12,685,436 shares are registered. As of September 30, 2019, 3,038,644 shares were outstanding under these plans and 6,727,985 shares had been issued, leaving 2,918,807 shares available for future issuance. Our primary plan, the Hillenbrand, Inc. Stock Incentive Plan, provides for long-term performance compensation for management and members of the Board of Directors. Under the Stock Incentive Plan, a variety of discretionary awards for employees and non-employee directors are authorized, including incentive or non-qualified stock options, stock appreciation rights, restricted stock, restricted stock units, and bonus stock. These programs are administered by the Board of Directors and its Compensation and Management Development Committee.



	Year Ended September 30,
	2019		2018		2017
Stock-based compensation cost	$	12.0	$	12.1	$	10.5
Less impact of income tax	2.8		2.9		3.8
Stock-based compensation cost, net of tax	$	9.2	$	9.2	$	6.7

The Company realized current tax benefits of $4.4 from the exercise of stock options and the payment of stock awards during 2019.

Stock Options — The fair values of option grants are estimated on the date of grant using the Black-Scholes option-pricing model. For grants issued prior to 2017, fair values were estimated using the binomial option-pricing model. The grants are contingent upon continued employment and generally vest over a three-year period. Expense is recognized on a straight-line basis over the applicable vesting periods. Option terms generally do not exceed 10 years. The weighted-average fair value of options granted was $10.15, $11.28, and $8.37 per share for 2019, 2018, and 2017. The following assumptions were used in the determination of fair value:



	Year Ended September 30,
	2019		2018		2017
Risk-free interest rate	2.9	%	2.4	%	1.9	%
Weighted-average dividend yield	2.0	%	1.8	%	2.2	%
Weighted-average volatility factor	27.5	%	28.0	%	28.8	%
Expected life (years)	5.7		5.6		5.8

The risk-free interest rate is based upon observed interest rates appropriate for the term of the employee stock options. The remaining assumptions require significant judgment utilizing historical information, peer data, and future expectations. The dividend yield is based on the history of dividend payouts and the computation of expected volatility is based on historical stock volatility. The expected life of employee stock options represents the weighted-average period the stock options are expected to remain outstanding based on historical exercise activity.

A summary of outstanding stock option awards as of September 30, 2019 and changes during the year is presented below:



	Number of Shares		Weighted-Average Exercise Price
Outstanding at September 30, 2018	1,868,257		$	33.84
Granted	431,726		41.31
Exercised	(96,219	)	26.90
Forfeited	(60,926	)	40.54
Expired/cancelled	(5,234	)	41.52
Outstanding at September 30, 2019	2,137,604		$	35.43

Exercisable at September 30, 2019	1,352,141		$	31.45

As of September 30, 2019, there was $4.2 of unrecognized stock-based compensation associated with unvested stock options expected to be recognized over a weighted-average period of 1.8 years. This unrecognized compensation expense included a reduction for our estimate of potential forfeitures. As of September 30, 2019, the average remaining life of the outstanding stock options was 6.4 years with an aggregate intrinsic value of $3.2. As of September 30, 2019, the average remaining life of the exercisable stock options was 5.1 years with an aggregate intrinsic value of $3.2. The total intrinsic value of options exercised by employees and directors during 2019, 2018, and 2017 was $1.4, $7.5, and $11.2. The grant-date fair value of options that vested during 2019, 2018, and 2017 was $15.4, $11.1, and $11.2.

Time-Based Stock Awards and Performance-Based Stock Awards — These awards are consistent with our compensation program’s guiding principles and are designed to (i) align management’s interests with those of shareholders, (ii) motivate and provide incentive to achieve superior results, (iii) maintain a significant portion of at-risk incentive compensation, (iv) delineate clear accountabilities, and (v) ensure competitive compensation. We believe that our blend of compensation components provides the Company’s management with the appropriate incentives to create long-term value for shareholders while taking thoughtful and prudent risks to grow the value of the Company. Our stock plan enables us to grant several types of restricted stock unit awards including time-based, performance-based contingent on the creation of shareholder value (“SV”), and performance-based based on a relative total shareholder return formula (“TSR”).

Our time-based stock awards provide an unconditional delivery of shares after a specified period of service. We record expense associated with time-based awards on a straight-line basis over the vesting period, net of estimated forfeitures.

The vesting of the SV awards is contingent upon the creation of shareholder value as measured by the cumulative cash returns and final period net operating profit after tax compared to the established hurdle rate over a three-year period and a corresponding service requirement. The hurdle rate is a reflection of the weighted-average cost of capital and targeted capital structure. The number of shares awarded is based upon the fair value of our stock at the date of grant adjusted for the attainment level at the end of the period. Based on the extent to which the performance criteria are achieved, it is possible for none of the awards to vest or for a range up to the maximum to vest. We record expense associated with the awards on a straight-line basis over the vesting period based upon an estimate of projected performance. The actual performance of the Company is evaluated quarterly, and the expense is adjusted according to the new projections. As a result, depending on the degree to which performance criteria are achieved or projections change, expenses related to the SV awards may become more volatile as we approach the final performance measurement date at the end of the three-year period.

The vesting of TSR awards is determined by comparing our total shareholder return during a three-year period to the respective total shareholder returns of companies in a designated performance peer group. Based on the Company’s relative ranking within the performance peer group, it is possible for none of the awards to vest or for a range up to the maximum to vest. The Monte-Carlo simulation method is used to determine fair value of TSR awards at the grant date. The Monte-Carlo simulation model estimates the fair value of this market-based award based upon the expected term, risk-free interest rate, expected dividend yield, and expected volatility measure for the Company and its peer group. Compensation expense for the TSR awards is recognized over the vesting period regardless of whether the market conditions are expected to be achieved.

A summary of the non-vested stock awards, including dividends, as of September 30, 2019 (representing the maximum number of shares that could be vested) and changes during the year is presented below:



	Number of Shares		Weighted-Average Grant Date Fair Value
Time-Based Stock Awards	Number of Shares		Weighted-Average Grant Date Fair Value
Non-vested time-based stock awards at September 30, 2018	92,578		$	38.19
Granted	29,651		41.09
Vested	(37,992	)	34.33
Forfeited	(15,307	)	39.90
Non-vested time-based stock awards at September 30, 2019	68,930		$	41.19



	Number of Shares		Weighted-Average Grant Date Fair Value
Performance-Based Stock Awards	Number of Shares		Weighted-Average Grant Date Fair Value
Non-vested performance-based stock awards at September 30, 2018	480,135		$	45.93
Granted	338,732		41.82
Vested	(134,140	)	37.59
Forfeited	(164,582	)	42.75
Non-vested performance-based stock awards at September 30, 2019	520,145		$	46.41

The total vest date fair value of shares held by Hillenbrand employees and directors which vested during 2019, 2018, and 2017 was $7.2, $15.2, and $10.9 (including dividends).

As of September 30, 2019, $1.2 and $6.5 of unrecognized stock-based compensation was associated with our unvested time-based and performance-based (including SV and TSR) stock awards. The unrecognized amount of compensation related to the SV awards is based upon projected performance to date. The unrecognized compensation cost of the time-based and performance-based awards is expected to be recognized over a weighted-average period of 1.8 and 1.7 years and includes a reduction for an estimate of potential forfeitures. As of September 30, 2019, the outstanding time-based stock awards and performance-based stock awards had an aggregate fair value of $2.1 and $13.6. The weighted-average grant date fair value of time-based stock awards was $46.77 and $35.41 per share for 2018 and 2017. The weighted-average grant date fair value of performance-based stock awards was $53.35 and $39.72 per share for 2018 and 2017.

Dividends payable in stock accrue on both time-based and SV awards during the performance period and are subject to the same terms as the original grants. Dividends do not accrue on TSR awards during the performance period. As of September 30, 2019, a total of 18,281 shares had accumulated on unvested stock awards due to dividend reinvestments and were included in the tables above. The aggregate fair value of these shares at September 30, 2019 was $0.6.

Vested Deferred Stock — Certain stock-based compensation programs allow or require deferred delivery of shares after vesting. As of September 30, 2019, there were 311,965 fully vested deferred shares, which were excluded from the tables above. The aggregate fair value of these shares at September 30, 2019 was $9.6.

Other Comprehensive Income (Loss)

12 Months Ended

Sep. 30, 2019

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Other Comprehensive Income (Loss)



	Pension and Postretirement			Currency Translation			Net Unrealized Gain (Loss) on Derivative Instruments			Total Attributable to Hillenbrand, Inc.			Noncontrolling Interests		Total
Balance at September 30, 2018	$	(41.0	)	$	(44.1	)	$	0.9		$	(84.2	)
Other comprehensive income before reclassifications
Before tax amount	(30.7		)	(20.6		)	(20.6		)	(71.9		)	$	—	$	(71.9	)
Tax benefit	8.2			—			1.6			9.8			—		9.8
After tax amount	(22.5		)	(20.6		)	(19.0		)	(62.1		)	—		(62.1		)
Amounts reclassified from accumulated other comprehensive income (loss)⁽¹⁾	1.2			—			4.5			5.7			—		5.7
Net current period other comprehensive income (loss)	(21.3		)	(20.6		)	(14.5		)	(56.4		)	$	—	$	(56.4	)
Balance at September 30, 2019	$	(62.3	)	$	(64.7	)	$	(13.6	)	$	(140.6	)

(1) Amounts are net of tax.

Reclassifications out of Accumulated other comprehensive income (loss) include:



	Year Ended September 30, 2019
	Amortization of Pension and Postretirement ⁽¹⁾				(Gain)/Loss on Derivative Instruments
	Net Loss Recognized		Prior Service Costs Recognized		(Gain)/Loss on Derivative Instruments			Total
Affected Line in the Consolidated Statement of Income:
Net revenue	$	—	$	—	$	0.2		$	0.2
Cost of goods sold	—		—		(0.8		)	(0.8		)
Other (expense) income, net	1.7		—		6.5			8.2
Total before tax	$	1.7	$	—	$	5.9		7.6
Tax benefit								(1.9		)
Total reclassifications for the period, net of tax								$	5.7

(1) These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension cost (see Note 6).



	Pension and Postretirement			Currency Translation			Net Unrealized Gain (Loss) on Derivative Instruments			Total Attributable to Hillenbrand, Inc.			Noncontrolling Interests			Total
Balance at September 30, 2017	$	(45.3	)	$	(36.9	)	$	1.0		$	(81.2	)
Other comprehensive income before reclassifications
Before tax amount	1.8			(7.2		)	1.8			(3.6		)	$	(0.7	)	$	(4.3	)
Tax expense	(0.5		)	—			(0.6		)	(1.1		)	—			(1.1		)
After tax amount	1.3			(7.2		)	1.2			(4.7		)	(0.7		)	(5.4		)
Amounts reclassified from accumulated other comprehensive income (loss)⁽¹⁾	3.0			—			(1.3		)	1.7			—			1.7
Net current period other comprehensive income (loss)	4.3			(7.2		)	(0.1		)	(3.0		)	$	(0.7	)	$	(3.7	)
Balance at September 30, 2018	$	(41.0	)	$	(44.1	)	$	0.9		$	(84.2	)

(1) Amounts are net of tax.

Reclassifications out of Accumulated other comprehensive income (loss) include:



	Year Ended September 30, 2018
	Amortization of Pension and Postretirement ⁽¹⁾				(Gain)/Loss on Derivative Instruments
	Net Loss Recognized		Prior Service Costs Recognized		(Gain)/Loss on Derivative Instruments			Total
Affected Line in the Consolidated Statement of Income:
Net revenue	$	—	$	—	$	0.5		$	0.5
Cost of goods sold	—		—		(0.1		)	(0.1		)
Other (expense) income, net	3.6		0.2		(2.3		)	1.5
Total before tax	$	3.6	$	0.2	$	(1.9	)	1.9
Tax benefit								(0.2		)
Total reclassifications for the period, net of tax								$	1.7

(1) These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note 6).



	Pension and Postretirement			Currency Translation			Net Unrealized Gain (Loss) on Derivative Instruments			Total Attributable to Hillenbrand, Inc.			Noncontrolling Interests		Total
Balance at September 30, 2016	$	(67.5	)	$	(61.6	)	$	(0.7	)	$	(129.8	)
Other comprehensive income before reclassifications
Before tax amount	28.1			24.7			3.2			56.0			$	0.2	$	56.2
Tax expense	(9.3		)	—			(1.2		)	(10.5		)	—		(10.5		)
After tax amount	18.8			24.7			2.0			45.5			0.2		45.7
Amounts reclassified from accumulated other comprehensive income (loss)⁽¹⁾	3.4			—			(0.3		)	3.1			—		3.1
Net current period other comprehensive loss	22.2			24.7			1.7			48.6			$	0.2	$	48.8
Balance at September 30, 2017	$	(45.3	)	$	(36.9	)	$	1.0		$	(81.2	)

(1) Amounts are net of tax.

Reclassifications out of Accumulated other comprehensive income (loss) include:



	Year Ended September 30, 2017
	Amortization of Pension and Postretirement ⁽¹⁾				(Gain)/Loss on Derivative Instruments
	Net Loss Recognized		Prior Service Costs Recognized		(Gain)/Loss on Derivative Instruments			Total
Affected Line in the Consolidated Statement of Income:
Net revenue	$	—	$	—	$	(0.1	)	$	(0.1	)
Cost of goods sold	—		—		(0.5		)	(0.5		)
Other (expense) income, net	4.6		0.4		0.1			5.1
Total before tax	$	4.6	$	0.4	$	(0.5	)	4.5
Tax benefit								(1.4		)
Total reclassifications for the period, net of tax								$	3.1

(1) These accumulated other comprehensive income (loss) components are included in the computation of net periodic pension cost (see Note 6).

Commitments and Contingencies

12 Months Ended

Sep. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Lease Commitments — We lease certain manufacturing facilities, warehouse distribution centers, service centers, and sales offices under operating leases. Rental expense for 2019, 2018, and 2017 was $26.0, $23.2 and $23.6. The aggregate future minimum lease payments for operating leases, excluding renewable periods, as of September 30, 2019, were as follows:



	Amount
2020	$	25.5
2021	23.5
2022	20.6
2023	16.3
2024	9.5
Thereafter	28.0
	$	123.4

Litigation

Like most companies, we are involved from time to time in claims, lawsuits, and government proceedings relating to our operations, including environmental, patent infringement, business practices, commercial transactions, product and general liability, workers’ compensation, auto liability, employment, and other matters. The ultimate outcome of these matters cannot be predicted with certainty. An estimated loss from these contingencies is recognized when we believe it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated; however, it is difficult to measure the actual loss that might be incurred related to these matters. If a loss is not considered probable and/or cannot be reasonably estimated, we are required to make a disclosure if there is at least a reasonable possibility that a significant loss may have been incurred. Legal fees associated with claims and lawsuits are generally expensed as incurred.

Claims covered by insurance have in most instances deductibles and self-funded retentions up to $0.5 per occurrence or per claim, depending upon the type of coverage and policy period. For auto, workers compensation, and general liability, outside insurance companies and third-party claims administrators generally assist in establishing individual claim reserves. An independent outside actuary often provides estimates of ultimate projected losses, including incurred but not reported claims, which are used to establish reserves for losses. For all other types of claims, reserves are established based upon advice from internal and external counsel and historical settlement information for claims when such amounts are considered probable of payment.

The recorded amounts represent our best estimate of the costs we will incur in relation to such exposures, but it is possible that actual costs will differ from those estimates.

Other (Expense) Income, Net

12 Months Ended

Sep. 30, 2019

Other Nonoperating Income (Expense) [Abstract]

Other (Expense) Income, Net



	Year Ended September 30,
	2019			2018			2017
Foreign currency exchange gain (loss), net	$	0.2		$	(1.2	)	$	(1.4	)
(Loss) gain on settlement of interest rate swaps⁽¹⁾	(6.4		)	2.3			—
Other, net	(0.5		)	(0.9		)	(3.2		)
Other (expense) income, net	$	(6.7	)	$	0.2		$	(4.6	)

Fair Value Measurements

12 Months Ended

Sep. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair value is defined as the exit price, or 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. The authoritative guidance establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are from sources independent of the Company. Unobservable inputs reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available in the circumstances. The categorization of financial assets and liabilities within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The hierarchy is broken down into three levels:



Level 1:	Inputs are quoted prices in active markets for identical assets or liabilities.
Level 2:	Inputs include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs (other than quoted prices) that are observable for the asset or liability, either directly or indirectly.
Level 3:	Inputs are unobservable for the asset or liability.

See the section below titled “Valuation Techniques” for further discussion of how Hillenbrand determines fair value for investments.



	Carrying Value at 9/30/2019		Fair Value at September 30, 2019
			Using Inputs Considered as:
			Level 1		Level 2		Level 3
Assets:
Cash and cash equivalents	$	399.0	$	399.0	$	—	$	—
Investments in rabbi trust	4.2		4.2		—		—
Derivative instruments	2.5		—		2.5		—

Liabilities:
2019 Notes	374.4		380.6		—		—
2010 Notes	149.9		152.8		—		—
Series A Notes	100.0		—		108.5		—
Derivative instruments	2.6		—		2.6		—



	Carrying Value at 9/30/2018		Fair Value at September 30, 2018
			Using Inputs Considered as:
			Level 1		Level 2		Level 3
Assets:
Cash and cash equivalents	$	56.0	$	56.0	$	—	$	—
Investments in rabbi trust	4.3		4.3		—		—
Derivative instruments	1.9		—		1.9		—

Liabilities:
2010 Notes	149.7		154.9		—		—
Revolver	95.7		—		95.7		—
Series A Notes	100.0		—		102.4		—
Derivative instruments	2.2		—		2.2		—

Valuation Techniques


•	The fair value of the investments in the rabbi trust were based on quoted prices in active markets. The trust assets consist of participant-directed investments in publicly traded mutual funds.


•	We estimate the fair value of our foreign currency derivatives using industry accepted models. The significant Level 2 inputs used in the valuation of our derivatives include spot rates, forward rates, and volatility. These inputs were obtained from pricing services, broker quotes, and other sources.


•	The fair value of the 2019 Notes and 2010 Notes were based on quoted prices in an active market.

•

The fair values of the Revolver and Series A Notes were estimated based on internally-developed models, using current market interest rate data for similar issues, as there is no active market for our revolving credit facility or Series A Notes.

- Definition

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

+ References + Details

Segment and Geographical Information

12 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

Segment and Geographical Information

We conduct our operations through two reportable business segments: the Process Equipment Group and Batesville. These reportable segments are determined on the basis of our management structure, and how we internally report financial information used to make operating decisions and evaluate results.

We record the direct costs of business operations to the reportable segments, including stock-based compensation, asset impairments, restructuring activities, and business acquisition costs. Corporate provides management and administrative services to each reportable segment. These services include treasury management, human resources, legal, business development, and other public company support functions such as internal audit, investor relations, financial reporting, and tax compliance. With limited exception for certain professional services and back-office and technology costs, we do not allocate these types of corporate expenses to the reportable segments.



	Year Ended September 30,
	2019			2018			2017
Net revenue
Process Equipment Group	$	1,274.4		$	1,219.5		$	1,028.2
Batesville	532.9			550.6			562.0
Total net revenue	$	1,807.3		$	1,770.1		$	1,590.2

Adjusted EBITDA
Process Equipment Group	$	223.3		$	215.8		$	177.7
Batesville	114.2			120.8			141.9
Corporate	(42.2		)	(42.3		)	(38.6		)

Net revenue⁽¹⁾
United States	$	892.5		$	926.4		$	896.1
Germany	568.7			512.5			425.6
All other foreign business units	346.1			331.2			268.5
Total revenue	$	1,807.3		$	1,770.1		$	1,590.2

Depreciation and amortization
Process Equipment Group	$	45.5		$	42.8		$	41.3
Batesville	10.7			11.9			13.8
Corporate	2.3			1.8			1.5
Total depreciation and amortization	$	58.5		$	56.5		$	56.6

(1) We attribute revenue to a geography based upon the location of the business unit that consummates the external sale.



	September 30,
	2019		2018
Total assets assigned
Process Equipment Group	$	1,729.1	$	1,638.8
Batesville	186.1		191.8
Corporate	313.4		34.0
Total assets	$	2,228.6	$	1,864.6

Tangible long-lived assets, net
United States	$	75.8	$	76.6
Germany	40.2		40.7
All other foreign business units	24.3		24.7
Tangible long-lived assets, net	$	140.3	$	142.0

The following schedule reconciles segment adjusted EBITDA to consolidated net income.



	Year Ended September 30,
	2019			2018			2017
Adjusted EBITDA:
Process Equipment Group	$	223.3		$	215.8		$	177.7
Batesville	114.2			120.8			141.9
Corporate	(42.2		)	(42.3		)	(38.6		)
Less:
Interest income	(1.1		)	(1.4		)	(0.9		)
Interest expense	27.4			23.3			25.2
Income tax expense	50.5			65.3			59.9
Depreciation and amortization	58.5			56.5			56.6
Business acquisition, development, and integration costs	16.6			3.5			1.1
Restructuring and restructuring related charges	10.6			2.5			10.7
Loss on settlement of interest rate swaps	6.4			—			—
Inventory step-up	0.2			—			—
Impairment charges	—			63.4			—
Consolidated net income	$	126.2		$	81.2		$	128.4

Unaudited Quarterly Financial Information

12 Months Ended

Sep. 30, 2019

Quarterly Financial Information Disclosure [Abstract]

Unaudited Quarterly Financial Information



	First Quarter		Second Quarter			Third Quarter		Fourth Quarter
2019
Net revenue	$	410.3	$	464.6		$	446.6	$	485.8
Gross profit	147.0		160.9			148.4		166.7
Net income ⁽¹⁾	28.3		38.0			30.4		24.7
Earnings per share — basic	0.45		0.60			0.48		0.39
Earnings per share —diluted	0.45		0.60			0.48		0.39

2018
Net revenue	$	397.2	$	452.2		$	446.0	$	474.7
Gross profit	146.2		168.6			163.5		163.8
Net income (loss) ^{(1) (2)}	18.1		(21.9		)	35.9		44.5
Earnings per share — basic	0.28		(0.34		)	0.57		0.71
Earnings per share —diluted	0.28		(0.34		)	0.56		0.70

(1) Net income (loss) attributable to Hillenbrand

Condensed Consolidating Information

12 Months Ended

Sep. 30, 2019

Condensed Financial Information Disclosure [Abstract]

Condensed Consolidating Information

Certain 100% owned domestic subsidiaries of Hillenbrand fully and unconditionally, jointly and severally, agreed to guarantee all of the indebtedness and guarantee obligations relating to our obligations under our senior unsecured notes. The following are the condensed consolidating financial statements, including the guarantors, which present the statements of income, balance sheets, and cash flows of (i) the parent holding company, (ii) the guarantor subsidiaries, (iii) the non-guarantor subsidiaries, and (iv) eliminations necessary to present the information for Hillenbrand on a consolidated basis.

Condensed Consolidating Statements of Income



	Year Ended September 30, 2019														Year Ended September 30, 2018														Year Ended September 30, 2017
	Parent			Guarantors			Non- Guarantors		Eliminations			Consolidated			Parent			Guarantors			Non- Guarantors			Eliminations			Consolidated		Parent			Guarantors			Non- Guarantors			Eliminations			Consolidated
Net revenue	$	—		$	893.7		$	1,144.1	$	(230.5	)	$	1,807.3		$	—		$	937.0		$	1,052.9		$	(219.8	)	$	1,770.1	$	—		$	901.4		$	904.7		$	(215.9	)	$	1,590.2
Cost of goods sold	—			493.7			814.7		(124.1		)	1,184.3			—			498.7			742.3			(113.0		)	1,128.0		—			468.4			646.8			(115.8		)	999.4
Gross profit	—			400.0			329.4		(106.4		)	623.0			—			438.3			310.6			(106.8		)	642.1		—			433.0			257.9			(100.1		)	590.8
Operating expenses	61.2			242.2			182.7		(106.4		)	379.7			54.2			248.2			183.3			(106.8		)	378.9		41.6			238.1			163.9			(100.1		)	343.5
Amortization expense	—			13.3			19.2		—			32.5			—			13.4			16.8			—			30.2		—			13.5			15.7			—			29.2
Impairment charge	—			—			—		—			—			—			63.4			—			—			63.4		—			—			—			—			—
Interest expense	23.8			0.2			3.4		—			27.4			20.3			1.1			1.9			—			23.3		21.8			—			3.4			—			25.2
Other (expense) income, net	(7.2		)	(0.3		)	0.8		—			(6.7		)	1.5			(0.3		)	(1.0		)	—			0.2		(1.4		)	(2.0		)	(1.2		)	—			(4.6		)
Equity in net income (loss) of subsidiaries	191.4			12.5			—		(203.9		)	—			139.3			9.1			—			(148.4		)	—		164.4			8.2			—			(172.6		)	—
Income (loss) before income taxes	99.2			156.5			124.9		(203.9		)	176.7			66.3			121.0			107.6			(148.4		)	146.5		99.6			187.6			73.7			(172.6		)	188.3
Income tax expense (benefit)	(22.2		)	34.3			38.4		—			50.5			(10.3		)	48.3			27.3			—			65.3		(26.6		)	65.9			20.6			—			59.9
Consolidated net income	121.4			122.2			86.5		(203.9		)	126.2			76.6			72.7			80.3			(148.4		)	81.2		126.2			121.7			53.1			(172.6		)	128.4
Less: Net income attributable to noncontrolling interests	—			—			4.8		—			4.8			—			—			4.6			—			4.6		—			—			2.2			—			2.2
Net income (loss)⁽¹⁾	$	121.4		$	122.2		$	81.7	$	(203.9	)	$	121.4		$	76.6		$	72.7		$	75.7		$	(148.4	)	$	76.6	$	126.2		$	121.7		$	50.9		$	(172.6	)	$	126.2
Consolidated comprehensive income (loss)	$	65.0		$	108.6		$	51.2	$	(155.0	)	$	69.8		$	73.6		$	77.1		$	72.1		$	(145.3	)	$	77.5	$	174.8		$	131.8		$	86.4		$	(215.8	)	$	177.2
Less: Comprehensive income attributable to noncontrolling interests	—			—			4.8		—			4.8			—			—			3.9			—			3.9		—			—			2.4			—			2.4
Comprehensive income (loss)⁽²⁾	$	65.0		$	108.6		$	46.4	$	(155.0	)	$	65.0		$	73.6		$	77.1		$	68.2		$	(145.3	)	$	73.6	$	174.8		$	131.8		$	84.0		$	(215.8	)	$	174.8

(1) Net income attributable to Hillenbrand

(2) Comprehensive income attributable to Hillenbrand

Condensed Consolidating Balance Sheets



	September 30, 2019											September 30, 2018
	Parent		Guarantors		Non- Guarantors		Eliminations			Consolidated		Parent		Guarantors		Non- Guarantors		Eliminations			Consolidated
Cash and cash equivalents	$	283.1	$	9.6	$	106.3	$	—		$	399.0	$	1.1	$	5.8	$	49.1	$	—		$	56.0
Trade receivables, net	—		113.6		103.8		—			217.4		—		124.5		94.0		—			218.5
Receivables from long-term manufacturing contracts	—		9.8		171.3		—			181.1		—		5.3		115.0		—			120.3
Inventories	—		78.2		101.2		(2.8		)	176.6		—		76.7		98.6		(2.8		)	172.5
Prepaid expense	2.5		4.1		20.1		—			26.7		2.7		7.0		15.5		—			25.2
Intercompany receivables	—		1,179.7		—		(1,179.7		)	—		—		1,131.1		79.1		(1,210.2		)	—
Other current assets	—		2.0		20.0		0.4			22.4		—		3.2		14.6		0.3			18.1
Total current assets	285.6		1,397.0		522.7		(1,182.1		)	1,023.2		3.8		1,353.6		465.9		(1,212.7		)	610.6
Property, plant, and equipment, net	3.8		61.2		75.3		—			140.3		3.8		60.2		78.0		—			142.0
Intangible assets, net	2.4		181.4		271.1		—			454.9		3.2		196.0		288.1		—			487.3
Goodwill	—		225.0		353.0		—			578.0		—		225.0		356.9		—			581.9
Investment in consolidated subsidiaries	2,266.4		655.2		—		(2,921.6		)	—		2,263.1		653.9		—		(2,917.0		)	—
Other assets	33.8		20.5		3.1		(25.2		)	32.2		15.7		28.2		5.9		(7.0		)	42.8
Total Assets	$	2,592.0	$	2,540.3	$	1,225.2	$	(4,128.9	)	$	2,228.6	$	2,289.6	$	2,516.9	$	1,194.8	$	(4,136.7	)	$	1,864.6

Trade accounts payable	$	2.6	$	59.0	$	174.6	$	—		$	236.2	$	—	$	62.4	$	134.4	$	—		$	196.8
Liabilities from long-term manufacturing contracts and advances	—		13.5		144.7		—			158.2		—		26.6		99.3		—			125.9
Accrued compensation	6.9		20.8		45.5		—			73.2		7.2		20.1		44.6		—			71.9
Intercompany payables	1,167.0		10.2		5.3		(1,182.5		)	—		1,206.2		6.1		—		(1,212.3		)	—
Other current liabilities	19.2		45.0		67.1		(9.6		)	121.7		19.4		38.9		78.1		0.7			137.1
Total current liabilities	1,195.7		148.5		437.2		(1,192.1		)	589.3		1,232.8		154.1		356.4		(1,211.6		)	531.7
Long-term debt	619.5		—		—		—			619.5		300.2		—		44.4		—			344.6
Accrued pension and postretirement healthcare	0.8		32.1		98.4		—			131.3		0.7		29.8		90.0		—			120.5
Deferred income taxes	—		24.0		64.8		(15.2		)	73.6		0.7		22.9		60.9		(8.1		)	76.4
Other long-term liabilities	21.9		12.5		10.7		—			45.1		24.1		14.3		8.9		—			47.3
Total Liabilities	1,837.9		217.1		611.1		(1,207.3		)	1,458.8		1,558.5		221.1		560.6		(1,219.7		)	1,120.5
Total Hillenbrand Shareholders’ Equity	754.1		2,323.2		598.4		(2,921.6		)	754.1		731.1		2,295.8		621.2		(2,917.0		)	731.1
Noncontrolling interests	—		—		15.7		—			15.7		—		—		13.0		—			13.0
Total Equity	754.1		2,323.2		614.1		(2,921.6		)	769.8		731.1		2,295.8		634.2		(2,917.0		)	744.1
Total Liabilities and Equity	$	2,592.0	$	2,540.3	$	1,225.2	$	(4,128.9	)	$	2,228.6	$	2,289.6	$	2,516.9	$	1,194.8	$	(4,136.7	)	$	1,864.6

Condensed Consolidating Statements of Cash Flows



	Year Ended September 30, 2019															Year Ended September 30, 2018															Year Ended September 30, 2017
	Parent			Guarantors			Non- Guarantors			Eliminations			Consolidated			Parent			Guarantors			Non- Guarantors			Eliminations			Consolidated			Parent			Guarantors			Non- Guarantors			Eliminations			Consolidated
Net cash provided by (used in) operating activities	$	22.1		$	114.5		$	148.7		$	(106.4	)	$	178.9		$	221.6		$	127.8		$	23.2		$	(124.3	)	$	248.3		$	79.9		$	126.7		$	168.3		$	(128.7	)	$	246.2

Investing activities:
Capital expenditures	(1.5		)	(10.9		)	(13.1		)	—			(25.5		)	(1.7		)	(12.1		)	(13.2		)	—			(27.0		)	(0.7		)	(9.7		)	(11.6		)	—			(22.0		)
Proceeds from sales of property, plant, and equipment	—			0.2			—			—			0.2			—			3.4			0.3			—			3.7			—			5.3			0.4			—			5.7
Acquisition of business, net of cash acquired	—			—			(25.9		)	—			(25.9		)	—			—			—			—			—			—			—			—			—			—
Return of investment capital from affiliates	—			—			—			—			—			—			—			—			—			—			3.2			—			—			—			3.2
Other, net	—			—			—			—			—			—			(0.1		)	—			—			(0.1		)	—			(0.4		)	—			—			(0.4		)
Net cash provided by (used in) investing activities	(1.5		)	(10.7		)	(39.0		)	—			(51.2		)	(1.7		)	(8.8		)	(12.9		)	—			(23.4		)	2.5			(4.8		)	(11.2		)	—			(13.5		)

Financing activities:
Proceeds from long-term debt, net of discount	374.4			—			—			—			374.4			—			—			—			—			—			—			—			—			—			—
Repayments of long-term debt	—			—			—			—			—			(148.5		)	—			—			—			(148.5		)	(13.5		)	—			—			—			(13.5		)
Proceeds from revolving credit facility	387.0			—			510.3			—			897.3			586.7			—			510.1			—			1,096.8			289.5			—			529.8			—			819.3
Repayments on revolving credit facility	(438.3		)	—			(552.1		)	—			(990.4		)	(548.3		)	—			(517.4		)	—			(1,065.7		)	(296.5		)	—			(656.5		)	—			(953.0		)
Payment of deferred financing costs	(7.5		)	—			—			—			(7.5		)	(2.8		)	—			—			—			(2.8		)	—			—			—			—			—
Payment of dividends - intercompany	—			(100.0		)	(6.4		)	106.4			—			—			(118.3		)	(6.0		)	124.3			—			—			(122.6		)	(6.1		)	128.7			—
Payment of dividends on common stock	(52.6		)	—			—			—			(52.6		)	(52.1		)	—			—			—			(52.1		)	(51.9		)	—			—			—			(51.9		)
Repurchases of common stock	—			—			—			—			—			(61.0		)	—			—			—			(61.0		)	(28.0		)	—			—			—			(28.0		)
Proceeds from stock option exercises and other	2.6			—			—			—			2.6			11.2			—			—			—			11.2			16.3			—			—			—			16.3
Payments for employee taxes on net settlement equity awards	(4.2		)	—			—			—			(4.2		)	(4.1		)	—			—			—			(4.1		)	(2.6		)	—			—			—			(2.6		)
Other, net				—			(2.1		)	—			(2.1		)	—			—			(6.3		)	—			(6.3		)	—			—			(1.7		)	—			(1.7		)
Net cash (used in) provided by financing activities	261.4			(100.0		)	(50.3		)	106.4			217.5			(218.9		)	(118.3		)	(19.6		)	124.3			(232.5		)	(86.7		)	(122.6		)	(134.5		)	128.7			(215.1		)

Effect of exchange rates on cash and cash equivalents	—			—			(2.3		)	—			(2.3		)	—			—			(2.7		)	—			(2.7		)	—			—			(3.6		)	—			(3.6		)

Net cash flows	282.0			3.8			57.1			—			342.9			1.0			0.7			(12.0		)	—			(10.3		)	(4.3		)	(0.7		)	19.0			—			14.0
Cash, cash equivalents and restricted cash at beginning of period	1.1			5.8			49.6			—			56.5			0.1			5.1			61.6			—			66.8			4.4			5.8			42.6			—			52.8
Cash, cash equivalents and restricted cash at end of period	$	283.1		$	9.6		$	106.7		$	—		$	399.4		$	1.1		$	5.8		$	49.6		$	—		$	56.5		$	0.1		$	5.1		$	61.6		$	—		$	66.8

Restructuring

12 Months Ended

Sep. 30, 2019

Restructuring and Related Activities [Abstract]

Restructuring

Hillenbrand periodically undergoes restructuring activities in order to enhance profitability through streamlined operations and an improved overall cost structure. The following schedule details the restructuring charges by segment and the classification of those charges on the Consolidated Statements of Income.



	Year Ended September 30,
	2019						2018						2017
	Cost of goods sold		Operating expenses		Total		Cost of goods sold		Operating expenses		Total		Cost of goods sold		Operating expenses		Total
Process Equipment Group	$	0.7	$	4.8	$	5.5	$	0.3	$	0.4	$	0.7	$	0.5	$	1.4	$	1.9
Batesville	0.5		4.2		4.7		0.5		0.5		1.0		5.5		—		5.5
Corporate	—		—		—		—		0.4		0.4		—		2.1		2.1
Total	$	1.2	$	9.0	$	10.2	$	0.8	$	1.3	$	2.1	$	6.0	$	3.5	$	9.5

The 2019 and 2018 restructuring charges related primarily to severance costs within the Process Equipment Group and Batesville. The 2017 restructuring charges related primarily to the closure of a plant at Batesville and severance costs within each segment. At September 30, 2019, $7.1 of restructuring costs were accrued and are expected to be paid over the next twelve months.

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

12 Months Ended

Sep. 30, 2019

SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract]

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

SCHEDULE II

HILLENBRAND, INC.

VALUATION AND QUALIFYING ACCOUNTS

FOR THE YEARS ENDED SEPTEMBER 30, 2019, 2018, AND 2017



			Additions
(in millions)	Balance at Beginning of Period		Charged to Revenue, Costs, and Expense		Charged to Other Accounts			Deductions Net of Recoveries (a)			Balance at End of Period
Allowance for doubtful accounts, early pay discounts, and sales returns:

Year ended September 30, 2019	$	22.2	$	1.9	$	(0.2	)	$	(1.1	)	$	22.8
Year ended September 30, 2018	$	21.6	$	3.5	$	(0.1	)	$	(2.8	)	$	22.2
Year ended September 30, 2017	$	21.0	$	2.5	$	0.1		$	(2.0	)	$	21.6

Allowance for inventory valuation:

Year ended September 30, 2019	$	18.2	$	1.5	$	(0.8	)	$	(1.1	)	$	17.8
Year ended September 30, 2018	$	19.0	$	2.2	$	(0.4	)	$	(2.6	)	$	18.2
Year ended September 30, 2017	$	18.0	$	2.4	$	0.8		$	(2.2	)	$	19.0

(a) Reflects the write-off of specific receivables against recorded reserves and other adjustments.

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Sep. 30, 2019

Basis of presentation

Basis of presentation — The accompanying Consolidated Financial Statements include the accounts of Hillenbrand and its subsidiaries. They also include two subsidiaries where the Company’s ownership percentage is less than 100%. The portion of the business that is not owned by the Company is presented as noncontrolling interests within equity in the balance sheets. Income attributable to the noncontrolling interests is separately reported within the Consolidated Statements of Income. All significant intercompany accounts and transactions have been eliminated.

Use of estimates

Use of estimates — We prepared the Consolidated Financial Statements in conformity with accounting principles generally accepted in the U.S. (“GAAP”). GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Foreign currency translation

Foreign currency translation — The financial statements of our foreign subsidiaries are translated into U.S. dollars using period-end exchange rates for assets and liabilities and average exchange rates for operating results. Unrealized translation gains and losses are included in accumulated other comprehensive loss in shareholders’ equity. When a transaction is denominated in a currency other than the subsidiary’s functional currency, we recognize a transaction gain or loss in Other (expense) income, net within the Consolidated Statements of Income when the transaction is settled.

Cash and cash equivalents

Cash and cash equivalents include short-term investments with original maturities of three months or less. The carrying amounts reported in the balance sheet for cash and cash equivalents are valued at cost, which approximates their fair value.

Trade receivables

Trade receivables are recorded at the invoiced amount and generally do not bear interest, unless they become past due. The allowance for doubtful accounts is a best estimate of the amount of probable credit losses and collection risk in the existing accounts receivable portfolio. The allowance for cash discounts and sales returns reserve are based upon historical experience and trends. Account balances are charged against the allowance when we believe it is probable the receivable will not be recovered. We generally hold trade accounts receivable until they are collected. At September 30, 2019 and 2018, we had reserves against trade receivables of $22.8 and $22.2.

Inventories

Inventories are valued at the lower of cost or market. Inventory costs are determined by the last-in, first-out (“LIFO”) method for approximately 28% and 30% of inventories at September 30, 2019 and 2018. Costs of remaining inventories have been determined principally by the first-in, first-out (“FIFO”) and average cost methods. If the FIFO method of inventory accounting, which approximates current cost, had been used for inventory accounted for using the LIFO method, that inventory would have been approximately $17.3 and $15.7 higher than reported at September 30, 2019 and 2018.

Property, plant, and equipment

Property, plant, and equipment are carried at cost less accumulated depreciation. Depreciation is computed using principally the straight-line method based on estimated useful lives of three to 50 years for buildings and improvements and three to 25 years for machinery and equipment. Major improvements that extend the useful lives of such assets are capitalized while expenditures for maintenance, repairs, and minor improvements are expensed as incurred. Upon disposal or retirement, the cost and accumulated depreciation of assets are eliminated. Any gain or loss is reflected in the Company’s income from operations. We review these assets for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. An impairment loss would be recognized when estimated future undiscounted cash flows relating to the asset are less than its carrying amount. The impairment loss is measured as the amount by which the carrying amount of an asset exceeds its fair value. Total depreciation expense for 2019, 2018, and 2017 was $23.2, $23.4, and $25.4.

Intangible assets

Intangible assets are stated at the lower of cost or fair value. With the exception of certain trade names, intangible assets are amortized on a straight-line basis over periods ranging from three to 21 years, representing the period over which we expect to receive future economic benefits from these assets. We assess the carrying value of trade names annually, or more often if events or changes in circumstances indicate there may be impairment. Estimated amortization expense related to intangible assets for the next five years is: $30.6 in 2020, $29.5 in 2021, $28.5 in 2022, $28.1 in 2023, and $27.9 in 2024.



	September 30, 2019					September 30, 2018
	Cost		Accumulated Amortization			Cost		Accumulated Amortization
Finite-lived assets:
Trade names	$	0.2	$	(0.2	)	$	0.2	$	(0.2	)
Customer relationships	464.2		(169.2		)	464.5		(148.4		)
Technology, including patents	76.8		(49.4		)	79.6		(45.1		)
Software	58.7		(51.7		)	58.0		(48.9		)
Other	0.2		(0.2		)	0.2		(0.2		)
	600.1		(270.7		)	602.5		(242.8		)
Indefinite-lived assets:
Trade names	125.5		—			127.6		—

Total	$	725.6	$	(270.7	)	$	730.1	$	(242.8	)

The net change in intangible assets during the year ended September 30, 2019 was driven by normal amortization and foreign currency translation, partially offset by the acquisition of BM&M in November 2018, which included intangible assets of approximately $14. See Note 4 for further detail on the acquisition of BM&M.

As a result of the required annual impairment assessment performed in the third quarter of 2019, the fair value of trade names was determined to meet or exceed the carrying value for all trade names, resulting in no impairment to trade names during the year ended September 30, 2019.

An impairment charge of $4.6 pre-tax ($3.5 after tax) was recorded during the year ended September 30, 2018 for trade names most directly impacted by domestic coal mining and coal power. See discussion of Goodwill below for further information on the impairment

Goodwill

Goodwill is not amortized, but is subject to annual impairment tests. Goodwill has been assigned to reporting units. We assess the carrying value of goodwill annually, or more often if events or changes in circumstances indicate there may be impairment. Impairment testing is performed at a reporting unit level.



	Process Equipment Group			Batesville		Total
Balance September 30, 2017	$	639.2		$	8.3	$	647.5
Impairment charge	(58.8		)	—		(58.8		)
Foreign currency adjustments	(6.8		)	—		(6.8		)
Balance September 30, 2018	573.6			8.3		581.9
Acquisitions, including purchase price adjustments	12.4			—		12.4
Foreign currency adjustments	(16.3		)	—		(16.3		)
Balance September 30, 2019	$	569.7		$	8.3	$	578.0

As a result of the required annual impairment assessment performed in the third quarter of 2019, the Company tested the recoverability of its goodwill, and in all reporting units, the fair value of goodwill was determined to exceed the carrying value, resulting in no impairment of goodwill.

In connection with the preparation of the quarterly financial statements for the second quarter of 2018, an interim impairment assessment was performed at the reporting unit most directly impacted by domestic coal mining and coal power. During the quarter ended March 31, 2018, published industry reports reduced their forecasts for domestic coal production and consumption. The reporting unit also experienced a larger than expected decline in orders for equipment and parts used in the domestic coal mining and coal power industries. In conjunction with these events and as part of the long-term strategic forecasting process, the Company made the decision to redirect strategic investments for growth, significantly reducing the reporting unit’s terminal growth rate. As a result of this change in expected future cash flows, along with comparable fair value information, management concluded that the reporting unit carrying value exceeded its fair value, resulting in a goodwill impairment charge of $58.8 during the year ended September 30, 2018.

Environmental liabilities

Environmental liabilities — Expenditures that relate to an existing condition caused by past operations which do not contribute to current or future revenue generation are expensed. A reserve is established when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These reserves are determined without consideration of possible loss recoveries. Based on consultations with an environmental engineer, the range of liability is estimated based on current interpretations of environmental laws and regulations. A determination is made of the specific measures that are believed to be required to remediate the site, the estimated total cost to carry out the remediation plan, and the periods in which we will make payments toward the remediation plan. We do not make an estimate of inflation for environmental matters because the number of sites is relatively small, we believe the magnitude of costs to execute remediation plans is not significant, and the estimated time frames to remediate sites are not believed to be lengthy.

Specific costs included in environmental expense and reserves include site assessment, remediation plan development, clean-up costs, post-remediation expenditures, monitoring, fines, penalties, and legal fees. The amount reserved represents the expected undiscounted future cash outflows associated with such plans and actions and we believe is not significant to Hillenbrand.

Self-insurance

Self-insurance — We are self-funded up to certain limits for product and general liability, workers compensation, and auto liability insurance programs, as well as certain employee health benefits including medical, drug, and dental. Claims covered by insurance have in most instances deductibles and self-funded retentions up to $0.5 per occurrence, depending upon the type of coverage and policy period. Our policy is to estimate reserves for product and general liability, workers compensation, and auto liability based upon a number of factors, including known claims, estimated incurred but not reported claims, and outside actuarial analysis. The outside actuarial analysis is based on historical information along with certain assumptions about future events. These reserves are classified as Other current liabilities and Other long-term liabilities within the Consolidated Balance Sheets.

Treasury stock

Treasury stock consists of our common shares that have been issued but subsequently reacquired. We account for treasury stock purchases under the cost method. When these shares are reissued, we use an average-cost method to determine cost. Proceeds in excess of cost are credited to additional paid-in capital.

In December 2018, the Board of Directors authorized a new share repurchase program of up to $200.0 in replacement of the Company’s prior share repurchase program, which eliminated the balance of approximately $39.6 remaining under that prior authorization. The repurchase program has no expiration date but may be terminated by the Board of Directors at any time. Share repurchases under the program are classified as treasury stock. We made no repurchases of our common stock during 2019. We repurchased approximately 1,385,600 shares of our common stock during 2018, at a total cost of $61.0. In 2019 and 2018, approximately 400,000 shares and 500,000 shares were issued from treasury stock under our stock compensation programs.

Preferred stock

Preferred stock — The Company has authorized 1,000,000 shares of preferred stock (no par value), of which no shares were issued at September 30, 2019 and 2018.

Accumulated other comprehensive loss

Accumulated other comprehensive loss includes all changes in Hillenbrand shareholders’ equity during the period except those that resulted from investments by or distributions to our shareholders.

Revenue recognition

Revenue recognition — Effective October 1, 2018, we adopted Accounting Standards Codification (“ASC”) 606 under the modified retrospective transition approach. See Note 3 for our policy for recognizing revenue under ASC 606 as well as the various other disclosures required by ASC 606.

For the years ended September 30, 2018 and 2017, revenue continues to be presented based on prior guidance. Under such guidance, net revenue included gross revenue less sales discounts, customer rebates, sales incentives, and product returns, all of which require us to make estimates for the portion of these allowances that have yet to be credited or paid to our customers. We estimated these allowances based upon historical rates and projections of customer purchases toward contractual rebate thresholds.

A portion of Hillenbrand’s revenue was derived from long-term manufacturing contracts. The majority of this revenue was recognized based on the percentage-of-completion method. Under this method, revenue is recognized based upon the costs incurred to date as compared to the total estimated project costs. Approximately 25% of Hillenbrand’s revenue was attributable to these long-term manufacturing contracts for both 2018 and 2017.

Accounting for these contracts involves management judgment in estimating total contract revenue and cost. Contract revenues are largely determined by negotiated contract prices and quantities, modified by our assumptions regarding contract options, change orders, and incentive and award provisions associated with technical performance clauses. Contract costs are incurred over longer periods of time and, accordingly, the estimation of these costs requires management judgment. Cost estimates are largely based on negotiated or estimated purchase contract terms, historical performance trends, and other economic projections. Significant factors that influence these estimates include inflationary trends, technical and schedule risk, internal and subcontractor performance trends, business volume assumptions, asset utilization, and anticipated labor agreements. Revenue and cost estimates are regularly monitored and revised based on changes in circumstances. Anticipated losses on long-term contracts are recognized immediately when such losses become evident. We maintain financial controls over the customer qualification, contract pricing, and estimation processes to seek to reduce the risk of contract losses.

Revenue for components, most replacement parts, and service is recognized when title and risk of loss passes to the customer.

Net revenue includes gross revenue less sales discounts, customer rebates, sales incentives, and product returns, all of which require us to make estimates for the portion of these allowances that have yet to be credited or paid to our customers. We estimate these allowances using the expected value method, which is based upon historical rates and projections of customer purchases toward contractual rebate thresholds.

Cost of goods sold

Cost of goods sold consists primarily of purchased material costs, fixed manufacturing expense, variable direct labor, and overhead costs. It also includes costs associated with the distribution and delivery of products.

Research and development costs

Research and development costs are expensed as incurred as a component of operating expenses and were $10.6, $11.7, and $11.9 for 2019, 2018, and 2017.

Warranty costs

Warranty costs — We provide for the estimated warranty cost of a product at the time revenue is recognized. Warranty expense is accrued based upon historical information and may also include specific provisions for known conditions. Warranty obligations are affected by actual product performance and by material usage and service costs incurred in making product corrections. Our

warranty provision takes into account the best estimate of amounts necessary to settle future and existing claims on products sold. The Process Equipment Group generally offers a one- to two-year warranty on a majority of its products. It engages in extensive product quality programs and processes in an effort to minimize warranty obligations, including active monitoring and evaluation of the quality of component suppliers. Warranty reserves were $17.1 and $16.9 for 2019 and 2018. Warranty costs were $3.4, $3.3, and $4.1 for 2019, 2018, and 2017

Income taxes

Income taxes — On December 22, 2017, the U.S. government enacted the Tax Cuts and Jobs Act of 2017 (the “Tax Act”). The Tax Act made broad and complex changes to the U.S. tax code, some of which went into effect during our fiscal year ended September 30, 2018 including, but not limited to (a) a reduction of the U.S. federal corporate tax rate from 35% to 21%, (b) a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries (“Transition Tax”), and (c) immediate expensing of certain capital expenditures. Since the effective date of the reduced tax rate was January 1, 2018, our fiscal year ended September 30, 2018 had a prorated U.S. federal corporate tax rate of 24.5%. In addition to the 21% tax rate, other key provisions of the Tax Act, such as the repeal of the Domestic Production Activities Deduction, imposition of tax on Global Intangible Low-Taxed Income (GILTI) earned by certain foreign subsidiaries, the Foreign Derived Intangible Income Deduction (FDII), and the Base Erosion and Anti-Abuse Tax (BEAT) went into effect in our fiscal year ended September 30, 2019. A company can elect to either recognize deferred taxes or provide tax expense in the year GILTI is incurred. The Company has elected to account for GILTI in the year the tax is incurred.

We establish deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the Consolidated Financial Statements. Deferred tax assets and liabilities are determined in part based on the differences between the accounting treatment of tax assets and liabilities under GAAP and the tax basis of assets and liabilities using statutory tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in statutory tax rates on deferred tax assets and liabilities is recognized in net income in the period that includes the enactment date. We continue to assert that most of the cash at our foreign subsidiaries represents earnings considered to be permanently reinvested for which deferred taxes have not been recorded in our Consolidated Financial Statements, as we do not intend, nor do we foresee a need, to repatriate these funds. We continue to actively evaluate our global capital deployment and cash needs.

We have a variety of deferred income tax assets in numerous tax jurisdictions. The recoverability of these deferred income tax assets is assessed periodically and valuation allowances are recognized if it is determined that it is more likely than not that the benefits will not be realized. When performing this assessment, we consider future taxable income, the reversal of existing temporary differences, and tax planning strategies. We account for accrued interest and penalties related to unrecognized tax benefits in income tax expense.

Derivative financial instruments

Derivative financial instruments — The Company has hedging programs in place to manage its currency exposures. The objectives of our hedging programs are to mitigate exposures in gross margin and non-functional-currency-denominated assets and liabilities. Under these programs, we use derivative financial instruments to manage the economic impact of fluctuations in currency exchange rates. These include foreign currency exchange forward contracts, which generally have terms up to 24 months. Additionally, the Company periodically enters into interest rate swaps to manage or hedge the risks associated with our indebtedness and interest payments. Our objectives in using these swaps are to add stability to interest expense and to manage our exposure to interest rate movements.

We measure all derivative instruments at fair value and report them on our balance sheets as assets or liabilities. Changes in the fair value of derivatives are accounted for depending on the intended use of the derivative, designation of the hedging relationship, and whether or not the criteria to apply hedge accounting has been satisfied. If a derivative is designated as a fair value hedge, the gain or loss on the derivative and the offsetting loss or gain on the hedged asset or liability are recognized in earnings. For derivative instruments designated as a cash flow hedge, the effective portion of the gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income and reclassified to earnings in the same period that the hedged transaction affects earnings. The portion of the gain or loss that does not qualify for hedge accounting is immediately recognized in earnings.

The aggregate notional amount of all derivative instruments was $128.9 and $152.6 at September 30, 2019 and 2018. The carrying value of all of our derivative instruments at fair value resulted in assets of $2.5 and $1.9 (included in other current assets and other assets) and liabilities of $2.6 and $2.2 (included in other current liabilities) at September 30, 2019 and 2018. See Note 13 for additional information on the fair value of our derivative instruments.

Foreign currency derivatives

Contracts designated as cash flow hedges for customer orders or intercompany purchases have an offsetting tax-adjusted amount in Accumulated other comprehensive loss. Foreign exchange contracts intended to manage foreign currency exposures within our balance sheet have an offsetting amount recorded in “Other (expense) income, net”. The cash flows from such hedges are presented in the same category in the Company’s Consolidated Statement of Cash Flows as the items being hedged.

Interest rate swap contracts

During the first quarter of 2019, the Company entered into interest rate swap contracts to hedge the interest rate associated with the forecasted issuance of $150.0 ten-year, fixed-rate debt. In September 2019, we issued $375.0 of senior unsecured notes (the “2019 Notes” as defined in Note 5) with a term of seven years. As a result of this issuance, Hillenbrand terminated and settled the interest rate swap contracts for a cash payment of $20.2.

Upon the issuance of the 2019 Notes, Hillenbrand determined that it was probable that the originally forecasted issuance of ten-year, fixed-rate debt would not occur. As a result, the Company accelerated the release of accumulated other comprehensive loss related to the missed forecasted transaction, resulting in a loss on settlement of $6.4. The loss on settlement was recorded within Other (expense) income, net, on the Consolidated Statements of Income. The remaining $13.8 is classified within Accumulated other comprehensive loss and will be amortized into Interest expense over the seven-year term of the 2019 Notes. The Company expects to reclassify amounts of $2.0 out of Accumulated other comprehensive loss into Interest expense over the next twelve months related to these interest rate swap contracts.

During the year ended September 30, 2018, we entered into interest rate swap contracts on $50.0 of outstanding borrowings under the Revolver (as defined in Note 5) in order to manage exposure to our variable interest payments. We terminated these interest rate swaps in the fourth quarter of 2018. As a result, a gain on settlement of $2.3 was released from Accumulated other comprehensive loss to Other (expense) income, net.

Business acquisitions and related business acquisition and integration costs

Business acquisitions and related business acquisition, development, and integration costs — Assets and liabilities associated with business acquisitions are recorded at fair value, using the acquisition method of accounting. We allocate the purchase price of acquisitions based upon the fair value of each component, which may be derived from observable or unobservable inputs and assumptions. We may utilize third-party valuation specialists to assist us in this allocation. Initial purchase price allocations are preliminary and subject to revision within the measurement period, generally not to exceed one year from the date of acquisition.

Business acquisition, development, and integration costs are expensed as incurred and are reported as a component of Cost of goods sold, Operating expenses, and Other (expense) income, net, depending on the nature of the cost. We define these costs to include finder’s fees, advisory, legal, accounting, valuation, and other professional or consulting fees, as well as travel associated with investigating opportunities (including acquisition and disposition). Business acquisition, development, and integration costs also include costs associated with acquisition tax planning, retention bonuses, and related integration costs. These costs exclude the ongoing expenses of our business development department.

Restructuring costs

Restructuring costs may occur when we take action to exit or significantly curtail a part of our operations or change the deployment of assets or personnel. A restructuring charge can consist of an impairment or accelerated depreciation of affected assets, severance costs associated with reductions to the workforce, costs to terminate an operating lease or contract, and charges for legal obligations for which no future benefit will be derived.

Recently adopted accounting standards