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Document and Entity Information - USD ($)	6 Months Ended
Document and Entity Information - USD ($)	Jun. 30, 2010	Jul. 22, 2010	Jun. 30, 2009
Document and Entity Information [Abstract]
Entity Registrant Name	LENNOX INTERNATIONAL INC
Entity Central Index Key	0001069202
Document Type	10-Q
Document Period End Date	Jun. 30, 2010
Amendment Flag	false
Document Fiscal Year Focus	2010
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 1,345,591,000
Entity Common Stock, Shares Outstanding		54,438,945

Consolidated Balance Sheets - USD ($) $ in Millions	6 Months Ended	12 Months Ended
Consolidated Balance Sheets - USD ($) $ in Millions	Jun. 30, 2010	Dec. 31, 2009
CURRENT ASSETS:
Cash and cash equivalents	$ 61.9	$ 124.3
Restricted cash	23.8	0.0
Accounts and notes receivable, net of allowances of $16.0 and $15.6 in 2010 and 2009, respectively	458.0	357.0
Inventories, net	338.4	250.2
Deferred income taxes	39.1	34.9
Other assets	48.3	67.5
Total current assets	969.5	833.9
PROPERTY, PLANT AND EQUIPMENT, net	318.2	329.6
GOODWILL	253.8	257.4
DEFERRED INCOME TAXES	66.4	74.6
OTHER ASSETS, net	59.3	48.4
TOTAL ASSETS	1,667.2	1,543.9
CURRENT LIABILITIES:
Short-term debt	6.1	2.2
Current maturities of long-term debt	0.5	35.5
Accounts payable	314.7	238.2
Accrued expenses	315.4	317.9
Income taxes payable	7.1	0.0
Total current liabilities	643.8	593.8
LONG-TERM DEBT	349.6	193.8
POSTRETIREMENT BENEFITS, OTHER THAN PENSIONS	13.2	13.4
PENSIONS	69.0	66.7
OTHER LIABILITIES	69.0	71.8
Total liabilities	$ 1,144.6	$ 939.5
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value, 25,000,000 shares authorized, no shares issued or outstanding	$ 0.0	$ 0.0
Common stock, $.01 par value, 200,000,000 shares authorized, 86,026,162 shares and 85,567,485 shares issued for 2010 and 2009, respectively	0.9	0.9
Additional paid-in capital	850.9	839.1
Retained earnings	588.8	558.6
Accumulated other comprehensive loss	(25.1)	(0.8)
Treasury stock, at cost, 31,589,468 shares and 29,292,512 shares for 2010 and 2009, respectively	(892.9)	(793.4)
Total stockholders' equity	522.6	604.4
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 1,667.2	$ 1,543.9

Consolidated Balance Sheets (Parenthetical) - USD ($)	Jun. 30, 2010	Dec. 31, 2009
CURRENT ASSETS:
Allowances, accounts and notes receivable	$ 16,000,000	$ 15,600,000
STOCKHOLDERS' EQUITY:
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	25,000,000	25,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	86,026,162	85,567,485
Treasury stock, shares	31,589,468	29,292,512

Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2010	Jun. 30, 2009	Jun. 30, 2010	Jun. 30, 2009
Consolidated Statements of Operations [Abstract]
NET SALES	$ 872.1	$ 784.0	$ 1,516.2	$ 1,364.5
COST OF GOODS SOLD	607.4	556.5	1,077.1	999.3
Gross profit	264.7	227.5	439.1	365.2
OPERATING EXPENSES:
Selling, general and administrative expenses	180.5	164.3	349.6	319.3
Losses (gains) and other expenses, net	5.8	0.7	5.5	(0.2)
Restructuring charges	3.2	4.7	10.3	15.9
Income from equity method investments	(4.1)	(1.8)	(6.1)	(3.2)
Operational income from continuing operations	79.3	59.6	79.8	33.4
INTEREST EXPENSE, net	3.1	2.0	5.6	3.9
OTHER EXPENSE, net	0.1	0.1	0.1	0.1
Income from continuing operations before income taxes	76.1	57.5	74.1	29.4
PROVISION FOR INCOME TAXES	27.4	21.6	26.7	11.2
Income from continuing operations	48.7	35.9	47.4	18.2
DISCONTINUED OPERATIONS:
Loss from discontinued operations	0.4	6.8	0.8	7.4
Income tax benefit		(2.6)	(0.1)	(2.8)
Loss from discontinued operations	0.4	4.2	0.7	4.6
Net income	$ 48.3	$ 31.7	$ 46.7	$ 13.6
EARNINGS PER SHARE - BASIC:
Income from continuing operations	$ 0.88	$ 0.65	$ 0.85	$ 0.33
Loss from discontinued operations		(0.08)	(0.01)	(0.08)
Net income	0.88	0.57	0.84	0.25
EARNINGS PER SHARE - DILUTED:
Income from continuing operations	0.86	0.63	0.83	0.33
Loss from discontinued operations		(0.07)	(0.01)	(0.09)
Net income	$ 0.86	$ 0.56	$ 0.82	$ 0.24
AVERAGE SHARES OUTSTANDING:
Basic	55.1	55.4	55.6	55.3
Diluted	56.3	56.6	56.8	55.9
CASH DIVIDENDS DECLARED PER SHARE	$ 0.15	$ 0.14	$ 0.3	$ 0.28

Consolidated Statements of Stockholders Equity and Comprehensive Income - USD ($) shares in Millions, $ in Millions	3 Months Ended	6 Months Ended		12 Months Ended
	Jun. 30, 2010	Jun. 30, 2010	Jun. 30, 2009	Dec. 31, 2009
Statement [Line Items]
Beginning balance		$ 604.4	$ 458.6	$ 458.6
Net income	$ 48.3	46.7	13.6	51.1
Dividends, $0.30 and $0.56 per share for 2010 and 2009 respectively		(16.5)		(31.3)
Foreign currency translation adjustments, net		(18.7)		59.5
Pension and postretirement liability changes, net of tax provision of $6.4				8.1
Stock-based compensation expense		7.7		12.8
Derivatives and other, net of tax benefit of $5.2 in 2010 and provision of $15.4 in 2009		(5.6)		30.4
Common stock issued		1.4		9.4
Treasury stock purchases 2,296,956 and 183,484 shares at $43.32 and $30.55 average price per share for 2010 and 2009 respectively		(99.5)		(5.6)
Tax benefits of stock-based compensation		2.7		6.0
Other tax related items				5.4
Ending balance	522.6	522.6		604.4
Common Stock Issued
Statement [Line Items]
Beginning balance		$ 0.9	$ 0.8	$ 0.8
Beginning balance, shares		85.6	84.2	84.2
Common stock issued				$ 0.1
Common stock issued, shares		0.4		1.4
Ending balance	$ 0.9	$ 0.9		$ 0.9
Ending balance, shares	86.0	86.0		85.6
Additional Paid-In Capital
Statement [Line Items]
Beginning balance		$ 839.1	$ 805.6	$ 805.6
Stock-based compensation expense		7.7		12.8
Common stock issued		1.4		9.3
Tax benefits of stock-based compensation		2.7		6.0
Other tax related items				5.4
Ending balance	$ 850.9	850.9		839.1
Retained Earnings
Statement [Line Items]
Beginning balance		558.6	538.8	538.8
Net income		46.7		51.1
Dividends, $0.30 and $0.56 per share for 2010 and 2009 respectively		(16.5)		(31.3)
Ending balance	588.8	588.8		558.6
Accumulated Other Comprehensive Loss
Statement [Line Items]
Beginning balance		(0.8)	(98.8)	(98.8)
Foreign currency translation adjustments, net		(18.7)		59.5
Pension and postretirement liability changes, net of tax provision of $6.4				8.1
Derivatives and other, net of tax benefit of $5.2 in 2010 and provision of $15.4 in 2009		(5.6)		30.4
Ending balance	(25.1)	(25.1)		(0.8)
Treasury Stock at Cost
Statement [Line Items]
Beginning balance		(793.4)	$ (787.8)	(787.8)
Treasury stock purchases 2,296,956 and 183,484 shares at $43.32 and $30.55 average price per share for 2010 and 2009 respectively		(99.5)		(5.6)
Ending balance	$ (892.9)	(892.9)		(793.4)
Comprehensive Income
Statement [Line Items]
Net income		46.7		51.1
Foreign currency translation adjustments, net		(18.7)		59.5
Pension and postretirement liability changes, net of tax provision of $6.4				8.1
Derivatives and other, net of tax benefit of $5.2 in 2010 and provision of $15.4 in 2009		(5.6)		30.4
Comprehensive income		$ 22.4		$ 149.1

Consolidated Statements of Stockholders Equity and Comprehensive Income (Parenthetical) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2010	Dec. 31, 2009
Statement [Line Items]
Dividends per share	$ 0.3	$ 0.56
Tax provision on pension and postretirement liability changes		$ 6.4
Tax provision (benefit) on derivatives and other	$ 5.2	$ 15.4
Treasury stock purchases, shares	2,296,956	183,484
Treasury stock purchases, average price per share	$ 43.32	$ 30.55
Treasury Stock at Cost
Statement [Line Items]
Treasury stock purchases, shares	2,296,956	183,484
Treasury stock purchases, average price per share	$ 43.32	$ 30.55
Retained Earnings
Statement [Line Items]
Dividends per share	$ 0.3	$ 0.56
Accumulated Other Comprehensive Loss
Statement [Line Items]
Tax provision on pension and postretirement liability changes		$ 6.4
Tax provision (benefit) on derivatives and other	$ 5.2	15.4
Comprehensive Income
Statement [Line Items]
Tax provision on pension and postretirement liability changes		6.4
Tax provision (benefit) on derivatives and other	$ 5.2	$ 15.4

Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2010	Jun. 30, 2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$ 46.7	$ 13.6
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Income from equity method investments	(6.1)	(3.2)
Dividends from affiliates	2.4	2.3
Restructuring expenses, net of cash paid	(7.9)	2.6
Provision for bad debts	5.0	7.2
Unrealized loss (gain) on derivative contracts	1.8	(4.5)
Return of collateral for hedges		37.4
Stock-based compensation expense	7.7	5.2
Depreciation and amortization	26.2	25.7
Deferred income taxes	5.3	11.5
Other items, net	13.9	17.9
Changes in assets and liabilities, net of effects of acquisitions and divestitures:
Accounts and notes receivable	(115.4)	(60.5)
Inventories	(107.8)	23.4
Other current assets	(3.3)	8.3
Accounts payable	81.7	27.1
Accrued expenses	10.6	(5.2)
Income taxes payable and receivable	14.3	(13.6)
Other	(1.1)	(12.5)
Net cash (used in) provided by operating activities	(26.0)	82.7
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the disposal of property, plant and equipment	0.1	0.2
Purchases of property, plant and equipment	(19.7)	(21.6)
Proceeds from sale of businesses	3.5	0.5
Acquisition of business	(7.4)	0.5
Restricted cash	(23.8)
Purchases of short-term investments		(17.0)
Proceeds from sales and maturities of short-term investments		16.8
Net cash used in investing activities	(47.3)	(20.6)
CASH FLOWS FROM FINANCING ACTIVITIES:
Short-term borrowings, net	4.2	1.1
Long-term payments	(35.3)	(1.3)
Issuance of senior unsecured notes	199.8
Payments on revolving credit facility	(44.5)	(100.8)
Proceeds from stock option exercises	1.4	1.9
Payments of deferred financing costs	(1.7)
Repurchases of common stock	(99.5)	(2.7)
Excess tax benefits related to share-based payments	2.6	0.2
Cash dividends paid	(16.2)	(15.5)
Net cash provided by (used in) financing activities	10.8	(117.1)
DECREASE IN CASH AND CASH EQUIVALENTS	(62.5)	(55.0)
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS	0.1	(1.7)
CASH AND CASH EQUIVALENTS, beginning of period	124.3	122.1
CASH AND CASH EQUIVALENTS, end of period	61.9	65.4
Cash paid during the year for:
Interest	4.4	3.5
Income taxes (net of refunds)	$ 4.5	$ 12.0

General	6 Months Ended
General	Jun. 30, 2010
General [Abstract]
General	1. General: References in this Quarterly Report on Form 10-Q to “we,” “our,” “us,” “LII” or the “Company” refer to Lennox International Inc. and its subsidiaries, unless the context requires otherwise. *Basis of Presentation* The accompanying unaudited Consolidated Balance Sheet as of June 30, 2010, the accompanying unaudited Consolidated Statements of Operations for the three and six months ended June 30, 2010 and 2009, the accompanying unaudited Consolidated Statement of Stockholders’ Equity for the six months ended June 30, 2010 and the accompanying unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2010 and 2009 should be read in conjunction with our audited consolidated financial statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2009. The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. The accompanying consolidated financial statements contain all material adjustments, consisting principally of normal recurring adjustments, necessary for a fair presentation of our financial position, results of operations and cash flows. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to applicable rules and regulations, although we believe that the disclosures herein are adequate to make the information presented not misleading. The operating results for the interim periods are not necessarily indicative of the results that may be expected for the full year. Our fiscal year ends on December 31 and our quarters are each comprised of 13 weeks. For convenience, throughout these financial statements, the 13 weeks comprising each quarterly period are denoted by the last day of the respective calendar quarter. *Use of Estimates* The preparation of financial statements requires us to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the valuation of accounts receivable, inventories, goodwill, intangible assets, and other long-lived assets, contingencies, guarantee obligations, indemnifications, and assumptions used in the calculation of income taxes, pension and postretirement medical benefits, among others. These estimates and assumptions are based on our best estimates and judgment. We evaluate our estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment. We believe these estimates and assumptions to be reasonable under the circumstances and adjust such estimates and assumptions when facts and circumstances dictate. *Reclassifications* Certain prior year amounts have been reclassified to conform to the current year presentation.

Derivatives

6 Months Ended

Jun. 30, 2010

Derivatives [Abstract]

Derivatives

4. Derivatives:

Cash Flow Hedges

We include (gains) losses in accumulated other comprehensive loss (“AOCL”) in connection with our commodity cash flow hedges. The (gains) losses related to commodity price hedges are expected to be reclassified into earnings within the next 18 months based on the prices of the commodities at settlement date. Assuming that commodity prices remain constant, $0.7 million of derivative losses are expected to be reclassified into earnings within the next 12 months. Commodity futures contracts that are designated as cash flow hedges and are in place as of June 30, 2010 are scheduled to mature through November 2011.

On June 12, 2009, we entered into a $100 million pay-fixed, receive-variable interest rate swap with a financial institution at a fixed interest rate of 2.66%. The variable portion of the interest rate swap is tied to the 1-Month LIBOR (the benchmark interest rate). The interest rates under both the interest rate swap and the underlying debt are reset, the swap is settled with the counterparty, and interest is paid, on a monthly basis. The interest rate swap expires October 12, 2012. We account for the interest rate swap as a cash flow hedge. The (gains) losses related to our interest rate swap are expected to be reclassified into earnings within the next 28 months based on the term of the swap. Assuming that the benchmark interest rate remains constant, $1.3 million of derivative losses are expected to be reclassified into earnings within the next 12 months.

We recorded the following amounts related to our cash flow hedges (in millions):


	As of			As of
	June 30,			December 31,
	2010			2009
Commodity Price Hedges:
Losses (gains) included in AOCL, net of tax	$	0.9		$	(7.2	)
(Benefit from) provision for income taxes		(0.5	)		4.1
Interest Rate Swap:
Losses included in AOCL, net of tax	$	2.4		$	1.4
Benefit from income taxes		(1.4	)		(0.8	)

We had the following outstanding commodity futures contracts designated as cash flow hedges (in millions):


	As of		As of
	June 30,		December 31,
	2010		2009
	(pounds)		(pounds)
Copper		20.1		12.6

Derivatives not Designated as Cash Flow Hedges

For commodity derivatives not designated as cash flow hedges, we follow the same hedging strategy as for derivatives designated as cash flow hedges. We elect not to designate these derivatives as cash flow hedges at the inception of the arrangement. We had the following outstanding commodity futures contracts not designated as cash flow hedges (in millions):


	As of		As of
	June 30,		December 31,
	2010		2009
	(pounds)		(pounds)
Copper		1.6		0.9
Aluminum		1.3		0.9

During the second quarter of 2010, we entered into foreign currency forward contracts with notional amounts of $54.3 million and £6.0 million, of which $19.0 million and £1.5 million were outstanding at June 30, 2010.

Information About the Location and Amounts of Derivative Instruments

For information on the location and amounts of derivative fair values in the Consolidated Balance Sheets and derivative gains and losses in the Consolidated Statements of Operations, see the tabular information presented below (in millions):


Fair Values of Derivative Instruments

	As of June 30,			As of December 31,
	2010			2009
Asset Derivatives	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments:
Commodity futures contracts	Other Assets (Current)	$	0.6	Other Assets (Current)	$	11.1
Commodity futures contracts	Other Assets (Non-current)		—	Other Assets (Non-current)		0.3

			0.6			11.4

Derivatives not designated as hedging instruments:
Commodity futures contracts	Other Assets (Current)		—	Other Assets (Current)		1.1

			—			1.1


Total Asset for Derivatives		$	0.6		$	12.5


Liability Derivatives
Derivatives designated as hedging instruments:
Commodity futures contracts	Accrued Expenses	$	1.6	Accrued Expenses	$	—
Commodity futures contracts	Other Liabilities		0.3	Other Liabilities		—
Interest rate swap	Accrued Expenses		2.0	Accrued Expenses		2.0
Interest rate swap	Other Liabilities		1.8	Other Liabilities		0.3

			5.7			2.3

Derivatives not designated as hedging instruments:
Commodity futures contracts	Accrued Expenses		0.2	Accrued Expenses		—
Foreign currency forward contracts	Accrued Expenses		0.4	Accrued Expenses		—

			0.6			—


Total Liability for Derivatives		$	6.3		$	2.3

The Effect of Derivative Instruments on the Consolidated Statements of Operations


	Location of Loss or (Gain) Reclassified	Amount of Loss or (Gain) Reclassified
Derivatives in Cash Flow	from AOCL into Income	from AOCL into Income (Effective
Hedging Relationships	(Effective Portion)	Portion)
		For the Three Months						For the Six Months
		Ended June 30,						Ended June 30,
		2010			2009			2010			2009
Commodity futures contracts	Cost of Goods Sold	$	(4.8	)	$	6.5		$	(7.6	)	$	16.9
Interest rate swap	Interest Expense, net		0.6			0.1			1.2			0.1

		$	(4.2	)	$	6.6		$	(6.4	)	$	17.0



	Location of (Gain) or Loss Recognized	Amount of (Gain) or Loss Recognized
Derivatives in Cash Flow	in Income on Derivatives	in Income on Derivatives (Ineffective
Hedging Relationships	(Ineffective Portion)	Portion)
		For the Three Months						For the Six Months
		Ended June 30,						Ended June 30,
		2010			2009			2010			2009
Commodity futures contracts	Losses (Gains) and Other Expenses, net	$	—		$	(0.1	)	$	(0.1	)	$	(0.1	)


	Location of (Gain) or Loss
Derivatives Not Designated	Recognized in Income on	Amount of (Gain) or Loss Recognized in Income on
as Hedging Instruments	Derivatives	Derivatives
		For the Three Months						For the Six Months
		Ended June 30,						Ended June 30,
		2010			2009			2010			2009
Commodity futures contracts	Losses (Gains) and Other Expenses, net	$	1.0		$	(1.1	)	$	0.6		$	(1.8	)
Foreign currency forward contracts	Losses (Gains) and Other Expenses, net		(0.1	)		2.2			(0.8	)		2.2

		$	0.9		$	1.1		$	(0.2	)	$	0.4

For more information on the fair value of these derivative instruments, see Note 14.

Commitments and Contingencies

6 Months Ended

Jun. 30, 2010

Commitments and Contingencies [Abstract]

Commitments and Contingencies

6. Commitments and Contingencies:

We are subject to contingencies that arise in the normal course of business, including product warranties and other product related contingencies, pending litigation, environmental matters and other guarantees or claims.

We use a combination of third-party insurance and self-insurance plans (large deductible or captive) to provide protection against claims relating to contingencies such as workers’ compensation, general liability, product liability, property damage, aviation liability, directors’ and officers’ liability, auto liability, physical damage and other exposures. Self-insurance expense and liabilities are actuarially determined based on our historical claims information, as well as industry factors and trends and because we have a captive insurance company, we are required to maintain specified levels of liquid assets from which we must pay claims. The majority of our self-insured risks (excluding auto liability and physical damage) will be paid over an extended period of time. There have been no material changes since our latest fiscal year-end. We also maintain third-party insurance coverage for risks not retained within our large deductible or captive insurance plans. The self-insurance liabilities recorded in Accrued Expenses in the accompanying Consolidated Balance Sheets were $64.2 million and $60.4 million as of June 30, 2010 and December 31, 2009, respectively.

Total liabilities for estimated warranty are included in the following captions on the accompanying Consolidated Balance Sheets (in millions):


	As of		As of
	June 30,		December 31,
	2010		2009
Accrued Expenses	$	29.6	$	31.5
Other Liabilities		46.3		50.0

	$	75.9	$	81.5

The changes in the total warranty liabilities for the first six months of 2010 were as follows (in millions):


Total warranty liability as of December 31, 2009	$	81.5
Payments made in 2010		(12.9	)
Changes resulting from issuance of new warranties		14.2
Changes in estimates associated with pre-existing liabilities		(6.1	)
Changes in foreign currency exchange rates		(0.8	)

Total warranty liability as of June 30, 2010	$	75.9


	As of		As of
	June 30,		December 31,
	2010		2009
Accrued product quality issue (not covered under warranty)	$	18.9	$	21.6

At the end of each accounting period, we evaluate our warranty liabilities and during the second quarter of each year, we perform a complete reevaluation of our warranty liabilities. As a result of our annual evaluation, we have recorded a reduction in warranty liabilities that is the principal amount contained within the changes in estimates associated with pre-existing liabilities of $6.1 million above.

We incur the risk of liability claims for the installation and service of heating and air conditioning products, and we maintain liabilities for those claims that we self-insure. We are involved in various claims and lawsuits related to our products. Our product liability insurance policies have limits that, if exceeded, may result in substantial costs that could have an adverse effect on our results of operations. In addition, warranty claims are not covered by our product liability insurance and certain product liability claims may also not be covered by our product liability insurance. There have been no material changes in the circumstances since our latest fiscal year-end.

We also may incur costs related to our products that may not be covered under our warranties and are not covered by insurance, and we may, from time to time, repair or replace installed products experiencing quality issues in order to satisfy our customers and to protect our brand. These product quality issues may be caused by vendor-supplied components that fail to meet required specifications.

We have identified a product quality issue in a heating and cooling product line produced in 2006 and 2007 that we believe results from a vendor-supplied materials quality issue. We have recorded an expense of $24.6 million in 2009 for the portion of the issue that is probable and can be reasonably estimated based upon the current data available and $18.9 million remained accrued as of June 30, 2010. There were no provisions to 2010. We may incur additional charges in the future as more information becomes available. The expense for this product quality issue, and the related liability, is not included in the tables related to our estimated warranty liabilities. The expense related to this product quality issue was classified in Cost of Goods Sold in the Consolidated Statements of Operations and the related liability is included in Accrued Expenses in the accompanying Consolidated Balance Sheets.

We estimate the costs to settle pending litigation based on experience involving similar claims and specific facts known. We do not believe that any current or pending or threatened litigation with have a material adverse effect on our financial position. Litigation and arbitration, however, involve uncertainties and it is possible that the eventual outcome of litigation could adversely affect our results of operations for a particular period. We are the defendant in a class action lawsuit related to certain hearth products we produced and sold that claims such products are hazardous and that consumers were not adequately warned. We recorded charges totaling $5.6 million related to this matter during the second quarter of 2010 and we may incur additional charges in the future. These charges are included in Selling, General and Administrative Expenses and Losses (Gains) and Other Expenses, Net in the accompanying Consolidated Statement of Operations.

Our obligations under the Lake Park Lease are secured by a pledge of our interest in the leased property and are also guaranteed by us and certain of our subsidiaries. The Lake Park Lease, as amended, contains restrictive covenants that are consistent with those of our domestic revolving credit facility. We are in compliance with these financial covenants as of June 30, 2010.

Lines of Credit and Financing Arrangements

6 Months Ended

Jun. 30, 2010

Lines of Credit and Financing Arrangements [Abstract]

Lines of Credit and Financing Arrangements

7. Lines of Credit and Financing Arrangements:

Long —Term Debt and Lines of Credit

The following tables summarize our outstanding debt obligations and the classification in the accompanying Consolidated Balance Sheets (in millions):


Description of Obligations	Short-Term		Current		Long-Term
As of June 30, 2010	Debt		Maturities		Maturities		Total
Domestic revolving credit facility	$	—	$	—	$	132.0	$	132.0
Senior unsecured notes		—		—		200.0		200.0
Capital lease obligations		—		0.5		17.6		18.1
Foreign obligations		6.1		—		—		6.1

Total debt	$	6.1	$	0.5	$	349.6	$	356.2


Description of Obligations	Short-Term		Current		Long-Term
As of June 31, 2009	Debt		Maturities		Maturities		Total
Domestic promissory notes⁽¹⁾	$	—	$	35.0	$	—	$	35.0
Domestic revolving credit facility		—		—		176.5		176.5
Capital lease obligations		—		0.4		17.1		17.5
Foreign obligations		2.2		0.1		0.2		2.5

Total debt	$	2.2	$	35.5	$	193.8	$	231.5


(1)		The domestic promissory notes that were due to mature on June 1, 2010 were prepaid during the first quarter of 2010.

As of June 30, 2010, we had outstanding borrowings of $132.0 million under the $650 million domestic revolving credit facility and $72.0 million was committed to standby letters of credit. All of the remaining $446.0 million was available for future borrowings after consideration of covenant limitations. The facility matures in October 2012. As of June 30, 2010, we were in compliance with all covenant requirements.

We have additional borrowing capacity through several of our foreign subsidiaries used primarily to finance seasonal borrowing needs. We had $6.1 million and $2.5 million of obligations outstanding through our foreign subsidiaries as of June 30, 2010 and December 31, 2009, respectively. Available borrowing capacity at June 30, 2010 and December 31, 2009, under foreign facilities was $11.9 million and $12.6 million, respectively.

The domestic revolving credit facility includes a subfacility for swingline loans of up to $50 million and provides for the issuance of letters of credit for the full amount of the credit facility. Our weighted average borrowing rate on the facility was 0.95% and 0.84% as of June 30, 2010 and December 31, 2009, respectively.

Our domestic revolving credit facility contains financial covenants relating to leverage and interest coverage.

Other covenants contained in the domestic revolving credit facility restrict, among other things, mergers, asset dispositions, guarantees, debt, liens, acquisitions, investments, affiliate transactions and our ability to make restricted payments. The financial covenants require us to maintain defined levels of Consolidated Indebtedness to Adjusted EBITDA Ratio and a Cash Flow (defined as EBITDA minus capital expenditures) to Net Interest Expense Ratio. The required ratios under our domestic revolving credit facility as of June 30, 2010 are detailed below:


Consolidated Indebtedness to Adjusted EBITDA Ratio no greater than		3.5 : 1.0
Cash Flow to Net Interest Expense Ratio no less than		3.0 : 1.0

Our domestic revolving credit facility contains customary events of default. These events of default include nonpayment of principal or interest, breach of covenants or other restrictions or requirements, default on certain other indebtedness or receivables securitizations (cross default), and bankruptcy. A cross default under our revolving credit facility could occur if:

	•		we fail to pay any principal or interest when due on any other indebtedness or receivables securitization of at least $40.0 million; or

	•		we are in default in the performance of, or compliance with, any term of any other indebtedness or receivables securitization in an aggregate principal amount of at least $40.0 million, or any other condition exists which would give the holders the right to declare such indebtedness due and payable prior to its stated maturity.

Each of our major debt agreements contains agreements by which a default under one agreement causes a default in the others. If a cross default under the revolving credit facility, our senior unsecured notes, or our revolving period asset securitization program was to occur, it could have a wider impact on our liquidity than might otherwise occur from a default of a single debt instrument or lease commitment.

If any event of default occurs and is continuing, lenders with a majority of the aggregate commitments may require the administrative agent to terminate our right to borrow under our domestic revolving credit facility and accelerate amounts due under our domestic revolving credit facility (except for a bankruptcy event of default, in which case such amounts will automatically become due and payable and the lenders’ commitments will automatically terminate).

On May 6, 2010, we issued $200.0 million of senior unsecured notes due May 15, 2017 bearing fixed interest at 4.90% as a result of a public offering of securities. We received proceeds of $199.8 million from the offering for a yield of 4.91%. We also paid and capitalized $1.9 million of debt issue costs related to the issuance. We will pay interest on the notes semiannually on May 15 and November 15.

The notes are guaranteed, on a senior unsecured basis, by each of our domestic subsidiaries that guarantee payment by us of any indebtedness under our domestic revolving credit facility. The indenture governing the notes contains covenants that, among other things, limit our ability and the ability of the subsidiary guarantors to: create or incur certain liens; enter into certain sale and leaseback transactions; enter into certain mergers, consolidations and transfers of substantially all of our assets; and transfer certain properties. The indenture also contains a cross default provision which is triggered if we default on other debt of at least $75 million in principal which is then accelerated, and such acceleration is not rescinded within 30 days of the notice date.

During the first quarter of 2010, our captive insurance subsidiary entered into an agreement in which cash was placed into a trust for the benefit of a third-party insurance provider. The purpose of the trust is to pay Workers Compensation claims for policy years 2003 — 2009 until the liabilities are fully extinguished. These policies were written by the third-party insurance provider, and then reinsured by our captive insurance subsidiary. This transaction was classified as restricted cash on the accompanying Consolidated Balance Sheets. The balance at June 30, 2010 was $23.8 million.

Asset Securitization

Under a revolving period asset securitization arrangement (“ASA”), we are eligible to sell beneficial interests in a portion of our trade accounts receivable to participating financial institutions for cash.

The ASA contains certain restrictive covenants relating to the quality of our accounts receivable and cross-default provisions with our Credit Agreement. The administrative agent under the ASA is also a participant in our Credit Agreement. The administrative agent has an investment grade credit rating. We continue to evaluate its creditworthiness and have no reason to believe it will not perform under the ASA. As of June 30, 2010, we were in compliance with all covenant requirements.

The ASA provides for a maximum securitization amount of $100.0 million or 100% of the net pool balance as defined by the ASA. However, eligibility for securitization is limited based on the amount and quality of the qualifying accounts receivable and is calculated monthly. The beneficial interest sold cannot exceed the maximum amount even if our qualifying accounts receivable is greater than the maximum amount at any point in time. The eligible amounts available and beneficial interests sold were as follows (in millions):


	As of		As of
	June 30,		December 31,
	2010		2009
Eligible amount available under the ASA on qualified accounts receivable	$	100.0	$	72.5
Beneficial interest sold		—		—

Remaining amount available	$	100.0	$	72.5

Under the ASA, we pay certain discount fees to use the program and have the facility available to us. These fees relate to both the used and unused portions of the securitization. The used fee is based on the beneficial interest sold and calculated on the average floating commercial paper rate determined by the purchaser of the beneficial interest, plus a program fee of 1.15%. The rate was 1.58% and 1.38% as of June 30, 2010 and December 31, 2009, respectively. The unused fee is based on 102% of the maximum available amount less the beneficial interest sold and calculated at 0.5% fixed rate throughout the term of the agreement. We recorded these fees in Selling, General and Administrative Expenses in the accompanying Consolidated Statements of Operations. The amounts recorded were as follows (in millions):


	For the Three Months Ended				For the Six Months Ended
	June 30,				June 30,
	2010		2009		2010		2009
Discount fees	$	0.1	$	0.2	$	0.3	$	0.4

Pension and Postretirement Benefit Plans

6 Months Ended

Jun. 30, 2010

Pension and Postretirement Benefit Plans [Abstract]

Pension and Postretirement Benefit Plans

8. Pension and Postretirement Benefit Plans:

The components of net periodic benefit cost were as follows (in millions):


	For the Three Months Ended June 30,
	2010			2009			2010			2009
	Pension Benefits						Other Benefits
Service cost	$	1.3		$	1.4		$	0.2		$	0.2
Interest cost		4.4			4.4			0.2			0.2
Expected return on plan assets		(4.9	)		(4.1	)		—			—
Amortization of prior service cost		0.1			0.2			(0.5	)		(0.5	)
Amortization of net loss		2.1			2.2			0.3			0.3
Settlements or curtailments		—			0.4			—			—

Total net periodic pension cost	$	3.0		$	4.5		$	0.2		$	0.2


	For the Six Months Ended June 30,
	2010			2009			2010			2009
	Pension Benefits						Other Benefits
Service cost	$	2.5		$	2.8		$	0.4		$	0.4
Interest cost		8.8			8.7			0.4			0.4
Expected return on plan assets		(9.7	)		(8.1	)		—			—
Amortization of prior service cost		0.2			0.3			(1.0	)		(1.0	)
Amortization of net loss		4.3			4.5			0.6			0.6
Settlements or curtailments		—			0.4			—			—

Total net periodic pension cost	$	6.1		$	8.6		$	0.4		$	0.4

The fair values of our pension plan assets, by asset category, are as follows:


	Fair Value Measurements as of
	June 30, 2010
	Quoted Prices in		Significant
	Active Markets		Other		Significant
	for		Observable		Unobservable
	Identical Assets		Inputs		Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Assets Category:
Cash and cash equivalents	$	6.2	$	—	$	—	$	6.2
Commingled pools / Collective Trusts
U.S. equity (1)		—		28.9		—		28.9
International equity (2)		—		43.8		—		43.8
Fixed income (3)		—		75.2		—		75.2
Mutual funds
U.S. equity (4)		34.6		—		—		34.6
International equity (4)		4.9		—		—		4.9
Fixed income (5)		6.1		—		—		6.1
Balanced pension trust (6)
U.S. equity		—		1.8		—		1.8
International equity		—		6.2		—		6.2
Bonds		—		4.8		—		4.8
Deposit pension fund (7)		—		7.2		—		7.2
Guaranteed investment contracts		—		1.9		—		1.9

Total	$	51.8	$	169.8	$	—	$	221.6

Additional information about assets measured at Net Asset Value per share (in millions):


	As of June 30, 2010
			Redemption
			Frequency
			(if currently	Redemption
	Fair Value		eligible)	Notice Period
Assets Category:
Commingled pools / Collective Trusts
U.S. equity (1)	$	28.9	n/a	n/a
International equity (2)		43.8	Monthly	10 — 15 days
Fixed income (3)		75.2	Quarterly	15 days
Mutual funds
U.S. equity (4)		34.6	n/a	n/a
International equity (4)		4.9	n/a	n/a
Fixed income (5)		6.1	n/a	n/a
Balanced pension trust (6)
U.S. equity		1.8	Daily	5 days
International equity		6.2	Daily	5 days
Bonds		4.8	Daily	5 days
Deposit pension fund (7)		7.2	Daily	7 days

Total	$	213.5


(1)		This category includes investments primarily in U.S. equity securities that include large, mid and small capitalization companies.

(2)		This category includes investments primarily in non-U.S. equity securities that include large, mid and small capitalization companies in large developed markets as well as emerging markets equities.

(3)		This category includes investments in U.S. investment grade and high yield fixed income securities, non-U.S. fixed income securities and emerging markets fixed income securities.

(4)		These funds seek capital appreciation and generally invest in common stocks of U.S. and Non-U.S. issuers. They may invest in growth stocks or value stocks.


(5)		This fund seeks to provide inflation protection. It currently invests at least 80% of its assets in inflation-indexed bonds issued by the U.S. government. It may invest in bonds of any maturity, though the fund typically maintains a dollar-weighted average maturity of 7 to 20 years.

(6)		The investment objectives of the fund are to provide long-term capital growth and income by investing primarily in a well-diversified, balanced portfolio of Canadian common stocks, bonds and money market securities. The fund also holds a portion of its assets in U.S. and non-U.S. equities.

(7)		This fund invests in United Kingdom money market instruments and includes cash, bank deposits and short-term fixed interest investments.

Restructuring Charges

6 Months Ended

Jun. 30, 2010

Restructuring Charges [Abstract]

Restructuring Charges

10. Restructuring Charges:

As part of our strategic priorities of manufacturing and sourcing excellence and expense reduction, we have initiated various manufacturing rationalization actions designed to lower our cost structure. We also continue to reorganize our North American distribution network in order to better serve our customers’ needs by deploying parts and equipment inventory closer to them. We have also initiated a number of activities that rationalize and reorganize various support and administrative functions to reduce ongoing selling and administrative expenses.

Information on Total Restructuring Charges and Related Reserves

Restructuring charges incurred include the following amounts (in millions):


	For the Three Months				For the Six Months
	Ended June 30,				Ended June 30,
	2010		2009		2010		2009
Manufacturing rationalizations	$	2.3	$	1.3	$	7.7	$	8.9
Reorganization of distribution network		—		0.2		0.2		0.3
Reorganizations of corporate and business unit selling and administrative functions		0.9		3.2		2.4		6.7

Total	$	3.2	$	4.7	$	10.3	$	15.9

The components of the $3.2 million of restructuring charges recorded in the second quarter of 2010 are discussed in greater detail in later sections of this footnote.

In the second quarter of 2009, restructuring charges for manufacturing rationalizations included $0.8 million related to the consolidation of Residential Heating & Cooling manufacturing operations from Blackville, South Carolina into our operations in Orangeburg, South Carolina and Saltillo, Mexico. Manufacturing rationalizations recorded in the second quarter of 2009 also included $0.3 million of charges related to the transition of production of certain Residential Heating & Cooling products from our Marshalltown, Iowa manufacturing facility to our manufacturing operations in Saltillo, Mexico and $0.2 million of charges related to the closure of our Refrigeration operations in Danville, Illinois and the consolidation of Danville manufacturing, support and warehouse functions into our Tifton, Georgia and Stone Mountain, Georgia operations.

In the second quarter of 2009, restructuring charges related to reorganizations of corporate and business unit selling and administrative functions included $2.1 million related to the reorganization of our Commercial Heating & Cooling business unit’s selling and administrative functions in Northern Europe and $0.7 million related to the reorganization of the management structure of our Refrigeration administrative and support functions across the globe. Restructuring charges recorded in the second quarter of 2009 also included $0.2 million related to the centralization of certain Service Experts administrative and support functions and $0.2 million related to the reorganization of certain corporate administrative functions.

Restructuring reserves are included in Accrued Expenses in the accompanying Consolidated Balance Sheets.

The table below details activity within the restructuring reserves for the first half of 2010 (in millions):


	Balance as of		Charged					Non-Cash			Balance as of
	December 31,		to		Cash			Utilization			June 30,
Description of Reserves	2009		Earnings		Utilization			and Other			2010
Severance and related expense	$	21.1	$	5.3	$	(15.7	)	$	(1.8	)	$	8.9
Asset write-offs and accelerated depreciation		—		2.5		—			(2.5	)		—
Equipment moves		—		0.4		(0.4	)		—			—
Lease termination		0.3		0.3		(0.3	)		—			0.3
Other		0.8		1.8		(1.8	)		(0.6	)		0.2

Total restructuring reserves	$	22.2	$	10.3	$	(18.2	)	$	(4.9	)	$	9.4

Manufacturing Rationalization Activities

Information regarding the restructuring charges related to manufacturing rationalizations is as follows (in millions):


					Total
	Charges		Charges		Charges
	Incurred in		Incurred to		Expected to
	2010		Date		be Incurred
Severance and related expense	$	4.6	$	29.7	$	29.8
Asset write-offs and accelerated depreciation		2.1		10.6		11.0
Equipment moves		0.3		2.4		3.3
Other		0.7		4.5		6.5

Total	$	7.7	$	47.2	$	50.6

Restructuring expense for manufacturing rationalization activities related to the following:

	•		In the first quarter of 2010, we began to exit certain Refrigeration manufacturing operations in Milperra, Australia. Total restructuring charges related to this action recorded in the first half of 2010 were $5.2 million, which was composed of severance of $4.0 million, asset write-offs of $1.1 million and other charges of $0.1 million. During the second quarter of 2010 we recorded $0.1 million of restructuring charges related to this action. This action was substantially completed during the first half of 2010.

	•		In the fourth quarter of 2009, we began the consolidation of certain Refrigeration manufacturing operations located in Parets, Spain into our existing operations in Genas, France. During the first half of 2010 we recorded restructuring charges totaling $1.5 million related to this action, which was composed of $0.7 of asset write-offs and $0.8 million of severance. During the second quarter of 2010 we recorded $1.3 million of restructuring charges related to this action. This action was substantially completed during the first half of 2010.

	•		In the first quarter of 2009, we began the consolidation of Residential Heating & Cooling manufacturing operations from Blackville, South Carolina into our operations in Orangeburg, South Carolina and Saltillo, Mexico. Total restructuring charges recorded related to this action in the first half of 2010 were $1.0 million, primarily composed of equipment move costs, accelerated depreciation, severance and other plant closure costs. During the second quarter of 2010 we recorded $0.6 million of restructuring charges related to this action. The consolidation is expected to be completed during the first quarter of 2011.

	•		Additionally, during the first half of 2010, we reversed $0.3 million of restructuring severance charges related to the consolidation of certain Commercial Heating & Cooling manufacturing operations located in Mions, France into our existing manufacturing operations in Longvic, France to adjust estimated amounts to actual.

Reorganization of Distribution Network

In the fourth quarter of 2008, we commenced the transition of activities currently performed at our North American Parts Center in Des Moines, Iowa to other locations, including our North American Distribution Center in Marshalltown, Iowa. We incurred $0.2 million of restructuring charges, which was composed of severance, during the second quarter and first half of 2010 related to this transition. To date, we have incurred $3.2 million, which was composed primarily of severance, and we expect the total cost to be $3.6 million related to this restructuring activity. The total cost of this restructuring activity will be composed of severance of $2.6 million, equipment moving costs of $0.3 million and other costs of $0.7 million. The transition is expected to be completed in the fourth quarter of 2010.

Reorganizations of Corporate and Business Unit Selling and Administrative Functions

Information regarding the restructuring charges related to the reorganization of corporate and business unit selling and administrative functions is as follows (in millions):


					Total
	Charges		Charges		Charges
	Incurred in		Incurred to		Expected to
	2010		Date		be Incurred
Employee relocation	$	1.0	$	1.4	$	1.8
Severance and related expense		0.6		21.2		21.4
Asset write-offs and accelerated depreciation		0.4		1.2		1.3
Lease termination		0.3		2.0		2.4
Other		0.1		0.8		1.0

Total	$	2.4	$	26.6	$	27.9

We incurred costs related to the following restructuring actions in our selling and administrative activities:

	•		In the third quarter of 2009, we initiated the relocation of Residential Heating & Cooling factory-built fireplace headquarters from Orange, California to Nashville, Tennessee and the consolidation of customer and technical service departments into our existing hearth products plant in Union City, Tennessee. As a result of this action, we recorded restructuring charges of $1.6 million during first half of 2010, which primarily consisted of employee relocation and lease termination costs. During the second quarter of 2010 we recorded $0.2 million of restructuring charges related to this action. Total anticipated restructuring charges related to this action are expected to total $4.1 million and consist principally of severance, recruiting, relocation costs and lease termination costs. We substantially completed this action during the first half of 2010.

	•		During the first quarter of 2009, we reorganized the management structure of our Refrigeration administrative and support functions across the globe. As a result of this action, we recorded restructuring severance charges of $0.3 million during the first half of 2010. During the second quarter of 2010 we recorded $0.2 million of restructuring charges related to this action. The action will be completed during the third quarter of 2010.

	•		During the second quarter of 2010, we recorded restructuring charges incurred related to the reorganization of certain administrative operations of an acquired company within our Service Experts segment. In connection with this action, we recorded asset write-offs totaling $0.3 million. Total anticipated restructuring costs associated with this action are $0.8 million and will consist of primarily of asset write-offs and lease termination costs. This action is expected to be completed by the end of the third quarter of 2010.

	•		In the third quarter of 2008, our Commercial Heating & Cooling business unit began to reorganize its selling and administrative functions in Northern Europe through a series of restructuring actions. Total restructuring charges recorded in the second quarter and first half of 2010 related to this action were $0.2 million. This action was completed in the second quarter of 2010.

Reportable Business Segments

6 Months Ended

Jun. 30, 2010

Reportable Business Segments [Abstract]

Reportable Business Segments

13. Reportable Business Segments:

We operate in four reportable business segments of the heating, ventilation, air conditioning and refrigeration (“HVACR”) industry. Our segments are organized primarily by the nature of the products and services provided. The table below details the nature of the operations of each reportable segment:


Segment	Product or Services	Markets Served	Geographic Areas
Residential Heating & Cooling	Heating	Residential Replacement	United States
	Air Conditioning	Residential New	Canada
	Hearth Products	Construction

Commercial Heating & Cooling	Rooftop Products	Light Commercial	United States
	Chillers		Canada
	Air Handlers		Europe

Service Experts	Equipment Sales Installation	Residential Light Commercial	United States Canada
	Maintenance
	Repair

Refrigeration	Unit Coolers	Light Commercial	United States
	Condensing Units	Food Preservation and	Canada
	Other Commercial	Non-Food/Industrial	Europe
	Refrigeration Products		Asia Pacific
			South America

Transactions between segments, such as products sold to Service Experts by the Residential Heating & Cooling segment, are recorded on an arm’s-length basis using the market price for these products. The eliminations of these intercompany sales and any associated profit are noted in the reconciliation of segment results to the income from continuing operations before income taxes below.

We use segment profit or loss as the primary measure of profitability to evaluate operating performance and to allocate capital resources.

Our corporate costs include those costs related to corporate functions such as legal, internal audit, treasury, human resources, tax compliance and senior executive staff. Corporate costs also include the long-term share-based incentive awards provided to employees throughout LII. We recorded these share-based awards as Corporate costs as they are determined at the discretion of the Board of Directors and based on the historical practice of doing so for internal reporting purposes.

Net sales and segment profit (loss) by business segment, along with a reconciliation of segment profit (loss) to Income from Continuing Operations Before Income Taxes are shown below (in millions):


	For the Three Months						For the Six Months Ended
	Ended June 30,						June 30,
	2010			2009			2010			2009
Net Sales
Residential Heating & Cooling	$	413.4		$	379.3		$	697.6		$	625.6
Commercial Heating & Cooling		175.8			162.7			295.4			294.2
Service Experts		167.6			147.2			294.7			251.6
Refrigeration		139.8			122.1			271.2			235.8
Eliminations (1)		(24.5	)		(27.3	)		(42.7	)		(42.7	)

	$	872.1		$	784.0		$	1,516.2		$	1,364.5


Segment Profit (Loss)(2)
Residential Heating & Cooling	$	52.5		$	39.3		$	59.6		$	34.5
Commercial Heating & Cooling		27.8			19.3			31.3			21.3
Service Experts		12.8			8.8			8.2			1.7
Refrigeration		15.3			9.6			30.2			16.1


	For the Three Months						For the Six Months Ended
	Ended June 30,						June 30,
	2010			2009			2010			2009
Corporate and other		(19.6	)		(14.7	)		(32.8	)		(28.6	)
Eliminations (1)		(0.3	)		—			(0.2	)		(0.3	)

Subtotal that includes segment profit and eliminations		88.5			62.3			96.3			44.7
Reconciliation to income from continuing operations before income taxes:
Items in losses (gains) and other expenses, net that are excluded from segment profit (3)		6.0			(2.0	)		6.2			(4.6	)
Restructuring charges		3.2			4.7			10.3			15.9
Interest expense, net		3.1			2.0			5.6			3.9
Other expense, net		0.1			0.1			0.1			0.1

Income from continuing operations before income taxes	$	76.1		$	57.5		$	74.1		$	29.4


(1)		Eliminations consist of intercompany sales between business segments, such as products sold to Service Experts by the Residential Heating & Cooling segment.

(2)		We define segment profit and loss as a segment’s income or loss from continuing operations before income taxes included in the accompanying Consolidated Statements of Operations: Excluding:

	o		Special product quality adjustments.

	o		Items within Losses (Gains) and Other Expenses, net that are noted in ⁽³⁾.

	o		Restructuring charges.

	o		Goodwill and equity method investment impairments.

	o		Interest expense, net.

	o		Other expense, net.


(3)		Items in Losses (Gains) and Other Expenses, net that are excluded from segment profit are net change in unrealized gains and/or losses on open future contracts, discount fee on accounts sold, realized gains and/or losses on marketable securities, special legal contingency charge, and other items.

Total assets by business segment are shown below (in millions). The assets in the Corporate segment are primarily comprised of cash and deferred tax assets. Assets recorded in the operating segments represent those assets directly associated with those segments.


	As of			As of
	June 30,			December 31,
	2010			2009
Total Assets
Residential Heating & Cooling	$	629.0		$	484.2
Commercial Heating & Cooling		270.6			238.5
Service Experts		190.1			173.1
Refrigeration		350.5			357.5
Corporate and other		243.4			297.3
Eliminations⁽¹⁾		(16.4	)		(10.3	)

Total assets		1,667.2			1,540.3
Discontinued operations (See Note 11)		—			3.6

Total assets	$	1,667.2		$	1,543.9


(1)		Eliminations consist of net intercompany receivables and intercompany profit included in inventory from products sold between business segments, such as products sold to Service Experts by the Residential Heating & Cooling segment.

Fair Value Measurements

6 Months Ended

Jun. 30, 2010

Fair Value Measurements [Abstract]

Fair Value Measurements

14. Fair Value Measurements:

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis (in millions):


	Fair Value Measurements on a Recurring Basis as of
	June 30, 2010
	Quoted Prices in		Significant
	Active Markets		Other		Significant
	for		Observable		Unobservable
	Identical Assets		Inputs		Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Assets:
Investment in marketable equity securities ⁽¹⁾	$	9.3	$	—	$	—	$	9.3
Liabilities:
Derivatives, net ⁽²⁾	$	—	$	5.7	$	—		5.7

Fair Value Measurements on a Recurring Basis as of

December 31, 2009

Quoted Prices in

Significant

Active Markets

Other

Significant

for

Observable

Unobservable

Identical Assets

Inputs

(Level 1)

(Level 2)

(Level 3)

Total

Assets:

Investment in marketable equity securities ⁽¹⁾

5.4

—

5.4

Derivatives, net ⁽²⁾

—

10.2

—

10.2


(1)		Investment in marketable equity securities is recorded in Other Long-term Assets in the accompanying Consolidated Balance Sheets.

(2)		Liability derivatives are recorded in Accrued Expenses and Other Liabilities and asset derivatives are recorded in Other Assets in the accompanying Consolidated Balance Sheets. See Note 4 for more information.

Other Fair Value Measurements

The carrying amounts of cash and cash equivalents, accounts and notes receivable, net, accounts payable and other current liabilities approximate fair value due to the short maturities of these instruments. The fair values of each of our long-term debt instruments are based on the quoted market prices for the same issues or on the amount of future cash flows associated with each instrument using current market rates for debt instruments of similar maturities and credit risk. The estimated fair value of long-term debt (including our domestic revolving credit facility, capital lease obligations, foreign obligations and any related current maturities) was $156.2 million and $242.5 million as of June 30, 2010 and December 31, 2009, respectively. The estimated fair value of our senior unsecured notes was $208.4 as of June 30, 2010. The fair values presented are estimates and are not necessarily indicative of amounts for which we could settle such instruments currently or indicative of our intent or ability to dispose of or liquidate them.

Condensed Consolidating Financial Statements

6 Months Ended

Jun. 30, 2010

Condensed Consolidating Financial Statements [Abstract]

Condensed Consolidating Financial Statements

15. Condensed Consolidating Financial Statements

The Company’s senior unsecured notes are unconditionally guaranteed by certain of the Company’s subsidiaries (the “Guarantor Subsidiaries”) while they are not by other subsidiaries (the “Non-Guarantor Subsidiaries”). As results of these guarantee arrangements, we are required to present the following condensed consolidating financial statements.

The condensed consolidating financial statements reflect the investments in subsidiaries of the Company using the equity method of accounting. Intercompany account balances have been included in Accounts and Notes Receivable, Other (Current) Assets, Other Assets, net, Short-Term Debt, Accounts Payable, and Long-Term Debt line items of the Parent, Guarantor and Non-Guarantor balance sheets. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions.

Condensed consolidating financial statements of the Company, its Guarantor Subsidiaries and Non-Guarantor Subsidiaries as of June 30, 2010 and December 31, 2009 and for the three and six months ended June 30, 2010 and 2009 are shown below:

Condensed Consolidating Balance Sheets
As of June 30, 2010
(In millions)


						Non-
				Guarantor		Guarantor
	Parent			Subsidiaries		Subsidiaries		Eliminations			Consolidated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	1.3		$	19.3	$	41.3	$	—		$	61.9
Short-term investments		—			—		23.8		—			23.8
Accounts and notes receivable, net		(955.0	)		771.3		645.4		(3.7	)		458.0
Inventories, net		—			222.9		118.4		(2.9	)		338.4
Deferred income taxes		5.1			25.4		14.9		(6.3	)		39.1
Other assets		0.6			20.0		94.3		(66.6	)		48.3

Total current assets		(948.0	)		1,058.9		938.1		(79.5	)		969.5
PROPERTY, PLANT AND EQUIPMENT, net		—			205.8		112.5		(0.1	)		318.2
GOODWILL		—			50.3		208.3		(4.8	)		253.8
DEFERRED INCOME TAXES		(3.1	)		65.9		17.6		(14.0	)		66.4
OTHER ASSETS, net		1,970.3			438.3		49.5		(2,398.8	)		59.3

TOTAL ASSETS	$	1,019.2		$	1,819.2	$	1,326.0	$	(2,497.2	)	$	1,667.2


LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Short-term debt	$	24.1		$	—	$	6.4	$	(24.4	)	$	6.1
Current maturities of long-term debt		—			0.3		0.3		(0.1	)		0.5
Accounts payable		8.2			186.5		130.1		(10.1	)		314.7
Accrued expenses		8.6			229.3		120.8		(43.3	)		315.4
Income taxes payable		(4.3	)		2.3		14.8		(5.7	)		7.1

Total current liabilities		36.6			418.4		272.4		(83.6	)		643.8
LONG-TERM DEBT		332.0			104.2		122.6		(209.2	)		349.6
POSTRETIREMENT BENEFITS, OTHER THAN PENSIONS		—			13.2		—		—			13.2
PENSIONS		—			59.8		9.2		—			69.0
OTHER LIABILITIES		5.1			49.5		29.2		(14.8	)		69.0

Total liabilities		373.7			645.1		433.4		(307.6	)		1,144.6
COMMITMENTS AND CONTINGENCIES
TOTAL STOCKHOLDERS’ EQUITY		645.5			1,174.1		892.6		(2,189.6	)		522.6

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	1,019.2		$	1,819.2	$	1,326.0	$	(2,497.2	)	$	1,667.2

Condensed Consolidating Statements of Operations
For the Three Months Ended June 30, 2010
(In millions)


							Non-
				Guarantor			Guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated
NET SALES	$	—		$	614.3		$	329.9		$	(72.1	)	$	872.1
COST OF GOODS SOLD		0.1			434.8			244.6			(72.1	)		607.4

Gross profit		(0.1	)		179.5			85.3			—			264.7
OPERATING EXPENSES:
Selling, general and administrative expenses		—			130.9			49.6			—			180.5
Losses (gains) and other expenses, net		1.6			4.6			(0.5	)		0.1			5.8
Restructuring charges		—			1.2			2.1			(0.1	)		3.2
Loss (income) from equity method investments		(56.0	)		(6.4	)		(4.1	)		62.4			(4.1	)

Operational income (loss) from continuing operations		54.3			49.2			38.2			(62.4	)		79.3
INTEREST EXPENSE, net		0.3			1.9			0.9			—			3.1
OTHER EXPENSE, net		—			—			0.1			—			0.1

Income (loss) from continuing operations before income taxes		54.0			47.3			37.2			(62.4	)		76.1
(BENEFIT FROM) PROVISIONS FOR INCOME TAXES		(0.8	)		15.1			13.0			0.1			27.4

Income (loss) from continuing operations		54.8			32.2			24.2			(62.5	)		48.7
Loss from discontinued operations		—			—			0.4			—			0.4

Net income (loss)	$	54.8		$	32.2		$	23.8		$	(62.5	)	$	48.3

Condensed Consolidating Statements of Operations
For the Six Months Ended June 30, 2010
(In millions)


							Non-
				Guarantor			Guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated
NET SALES	$	—		$	1,043.7		$	604.1		$	(131.6	)	$	1,516.2
COST OF GOODS SOLD		0.1			757.5			451.1			(131.6	)		1,077.1

Gross profit		(0.1	)		286.2			153.0			—			439.1
OPERATING EXPENSES:
Selling, general and administrative expenses		—			247.3			102.2			0.1			349.6
Losses (gains) and other expenses, net		1.4			4.5			(0.5	)		0.1			5.5
Restructuring charges		—			3.2			7.2			(0.1	)		10.3
(Income) loss from equity method investments		(51.2	)		(3.5	)		(6.1	)		54.7			(6.1	)

Operational income (loss) from continuing operations		49.7			34.7			50.2			(54.8	)		79.8
INTEREST EXPENSE, net		—			3.8			1.8			—			5.6
OTHER EXPENSE, net		—			—			0.1			—			0.1

Income (loss) from continuing operations before income taxes		49.7			30.9			48.3			(54.8	)		74.1
(BENEFIT FROM) PROVISIONS FOR INCOME TAXES		(0.6	)		10.1			17.1			0.1			26.7

Income (loss) from continuing operations		50.3			20.8			31.2			(54.9	)		47.4
Loss from discontinued operations		—			—			0.7			—			0.7

Net income (loss)	$	50.3		$	20.8		$	30.5		$	(54.9	)	$	46.7

Condensed Consolidating Balance Sheets
As of December 31, 2009
(In millions)


							Non-
				Guarantor			Guarantor
	Parent			Subsidiaries			Subsidiaries		Eliminations			Consolidated
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	0.8		$	6.6		$	116.9	$	—		$	124.3
Accounts and notes receivable, net		(975.0	)		775.1			558.3		(1.4	)		357.0
Inventories, net		—			139.4			113.7		(2.9	)		250.2
Deferred income taxes		—			25.4			15.8		(6.3	)		34.9
Other assets		12.2			19.1			93.0		(56.8	)		67.5

Total current assets		(962.0	)		965.6			897.7		(67.4	)		833.9
PROPERTY, PLANT AND EQUIPMENT, net		—			207.8			121.8		—			329.6
GOODWILL		—			46.7			215.4		(4.7	)		257.4
DEFERRED INCOME TAXES		—			67.3			21.2		(13.9	)		74.6
OTHER ASSETS, net		1,905.1			371.4			41.5		(2,269.6	)		48.4

TOTAL ASSETS	$	943.1		$	1,658.8		$	1,297.6	$	(2,355.6	)	$	1,543.9


LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Short-term debt	$	25.1		$	—		$	2.5	$	(25.4	)	$	2.2
Current maturities of long-term debt		35.0			—			0.5		—			35.5
Accounts payable		7.9			115.4			122.7		(7.8	)		238.2
Accrued expenses		5.1			192.5			154.3		(34.0	)		317.9
Income taxes payable		(17.5	)		(21.6	)		43.2		(4.1	)		—

Total current liabilities		55.6			286.3			323.2		(71.3	)		593.8
LONG-TERM DEBT		176.5			98.8			117.4		(198.9	)		193.8
POSTRETIREMENT BENEFITS, OTHER THAN PENSIONS		—			13.4			—		—			13.4
PENSIONS		—			56.3			10.5		(0.1	)		66.7
OTHER LIABILITIES		2.6			50.9			32.9		(14.6	)		71.8

Total liabilities		234.7			505.7			484.0		(284.9	)		939.5
COMMITMENTS AND CONTINGENCIES
TOTAL STOCKHOLDERS’ EQUITY		708.4			1,153.1			813.6		(2,070.7	)		604.4

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	943.1		$	1,658.8		$	1,297.6	$	(2,355.6	)	$	1,543.9

Condensed Consolidating Statements of Operations
For the Three Months Ended June 30, 2009
(In millions)


						Non-
				Guarantor		Guarantor
	Parent			Subsidiaries		Subsidiaries			Eliminations			Consolidated
NET SALES	$	—		$	563.7	$	286.0		$	(65.7	)	$	784.0
COST OF GOODS SOLD		0.1			403.6		218.2			(65.4	)		556.5

Gross profit		(0.1	)		160.1		67.8			(0.3	)		227.5
OPERATING EXPENSES:
Selling, general and administrative expenses		—			117.0		47.3			—			164.3
(Gains) losses and other expenses, net		(2.2	)		0.1		2.8			—			0.7
Restructuring charges		—			1.7		2.9			0.1			4.7
(Income) loss from equity method investments		(30.3	)		0.5		(1.9	)		29.9			(1.8	)

Operational income (loss) from continuing operations		32.4			40.8		16.7			(30.3	)		59.6
INTEREST (INCOME) EXPENSE, net		(0.1	)		2.2		(0.2	)		0.1			2.0
OTHER EXPENSE, net		—			—		0.1			—			0.1

Income (loss) from continuing operations before income taxes		32.5			38.6		16.8			(30.4	)		57.5
PROVISIONS FOR INCOME TAXES		0.8			14.5		6.3			—			21.6

Income (loss) from continuing operations		31.7			24.1		10.5			(30.4	)		35.9
Loss from discontinued operations		—			—		4.2			—			4.2

Net income (loss)	$	31.7		$	24.1	$	6.3		$	(30.4	)	$	31.7

Condensed Consolidating Statements of Operations
For the Six Months Ended June 30, 2009
(In millions)


							Non-
				Guarantor			Guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated
NET SALES	$	—		$	963.4		$	517.8		$	(116.7	)	$	1,364.5
COST OF GOODS SOLD		0.1			713.0			402.9			(116.7	)		999.3

Gross profit		(0.1	)		250.4			114.9			—			365.2
OPERATING EXPENSES:
Selling, general and administrative expenses		—			228.3			91.1			(0.1	)		319.3
(Gains) losses and other expenses, net		(4.8	)		—			4.6			—			(0.2	)
Restructuring charges		—			9.0			6.9			—			15.9
(Income) loss from equity method investments		(0.2	)		10.2			(3.2	)		(10.0	)		(3.2	)

Operational income from continuing operations		4.9			2.9			15.5			10.1			33.4
INTEREST (INCOME) EXPENSE, net		(0.4	)		4.5			(0.3	)		0.1			3.9
OTHER EXPENSE, net		—			—			0.1			—			0.1

Income (loss) from continuing operations before income taxes		5.3			(1.6	)		15.7			10.0			29.4
PROVISIONS FOR INCOME TAXES		1.9			3.2			6.1			—			11.2

Income (loss) from continuing operations		3.4			(4.8	)		9.6			10.0			18.2
Loss from discontinued operations		—			—			4.6			—			4.6

Net income (loss)	$	3.4		$	(4.8	)	$	5.0		$	10.0		$	13.6

Condensed Consolidating Statements of Cash Flows
For the Six Months Ended June 30, 2010
(In millions)


							Non-
				Guarantor			Guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations		Consolidated
Net cash provided by (used in) operating activities	$	26.9		$	2.7		$	(55.6	)	$	—	$	(26.0	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the disposal of property, plant and equipment		—			—			0.1			—		0.1
Purchases of property, plant and equipment		—			(15.7	)		(4.0	)		—		(19.7	)
Proceeds from sale of business		—			0.1			3.4			—		3.5
Acquisition of business		—			(6.4	)		(1.0	)		—		(7.4	)
Restricted cash		—			—			(23.8	)		—		(23.8	)

Net cash used in investing activities		—			(22.0	)		(25.3	)		—		(47.3	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Short-term borrowings, net		—			—			4.2			—		4.2
Long-term payments		(35.0	)		—			(0.3	)		—		(35.3	)
Issuance of senior unsecured notes		199.8			—			—			—		199.8
Revolver long-term borrowings, net		(44.5	)		—			—			—		(44.5	)
Proceeds from stock option exercises		1.4			—			—			—		1.4
Payments of deferred financing costs		(1.7	)		—			—			—		(1.7	)
Repurchases of common stock		(99.5	)		—			—			—		(99.5	)
Excess tax benefits related to share-based payments		2.6			—			—			—		2.6
Intercompany debt		(14.8	)		8.4			6.4			—		—
Intercompany financing activity		(19.6	)		23.6			(4.0	)		—		—
Intercompany investments		(7.9	)		—			7.9			—		—
Intercompany dividends		9.0			—			(9.0	)		—		—
Cash dividends paid		(16.2	)		—			—			—		(16.2	)

Net cash (used in) provided by financing activities		(26.4	)		32.0			5.2			—		10.8
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		0.5			12.7			(75.7	)		—		(62.5	)
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS		—			—			0.1			—		0.1
CASH AND CASH EQUIVALENTS, beginning of year		0.8			6.6			116.9			—		124.3

CASH AND CASH EQUIVALENTS, end of year	$	1.3		$	19.3		$	41.3		$	—	$	61.9

Condensed Consolidating Statements of Cash Flows
For the Six Months Ended June 30, 2009
(In millions)


							Non-
				Guarantor			Guarantor
	Parent			Subsidiaries			Subsidiaries			Eliminations		Consolidated
Net cash provided by (used in) operating activities	$	60.9		$	(2.9	)	$	24.7		$	—	$	82.7
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the disposal of property, plant and equipment		—			0.1			0.1			—		0.2
Purchases of property, plant and equipment		—			(17.9	)		(3.7	)		—		(21.6	)
Proceeds from sale of business		—			0.5			—			—		0.5
Return on investment		—			—			0.5			—		0.5
Purchases of short-term investments		—			—			(17.0	)		—		(17.0	)
Proceeds from sales and maturities of short-term investments		—			—			16.8			—		16.8

Net cash used in investing activities		—			(17.3	)		(3.3	)		—		(20.6	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Short-term borrowings, net		—			—			1.1			—		1.1
Long-term payments		—			—			(1.3	)		—		(1.3	)
Revolver long-term payments, net		(100.8	)		—			—			—		(100.8	)
Proceeds from stock option exercises		1.9			—			—			—		1.9
Repurchases of common stock		(2.7	)		—			—			—		(2.7	)
Excess tax benefits related to share-based payments		0.2			—			—			—		0.2
Intercompany debt		25.7			(2.6	)		(23.1	)		—		—
Intercompany financing activity		25.8			38.3			(64.1	)		—		—
Intercompany dividends		5.0			—			(5.0	)		—		—
Cash dividends paid		(15.5	)		—			—			—		(15.5	)

Net cash (used in) provided by financing activities		(60.4	)		35.7			(92.4	)		—		(117.1	)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		0.5			15.5			(71.0	)		—		(55.0	)
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS		—			—			(1.7	)		—		(1.7	)
CASH AND CASH EQUIVALENTS, beginning of year		—			3.1			119.0			—		122.1

CASH AND CASH EQUIVALENTS, end of year	$	0.5		$	18.6		$	46.3		$	—	$	65.4

Income Taxes	6 Months Ended
Income Taxes	Jun. 30, 2010
Income Taxes [Abstract]
Income Taxes	5. Income Taxes: As of June 30, 2010, we had approximately $1.6 million in total gross unrecognized tax benefits. Of this amount, $1.1 million (net of federal benefit on state issues), if recognized, would be recorded through the Consolidated Statement of Operations. As of June 30, 2010, we had recognized $0.1 million (net of federal tax benefits) in interest and penalties in income tax expense. We are currently under examination for our U.S. federal income taxes for 2010, 2009 and 2008 and are subject to examination by numerous other taxing authorities in the U.S. and in jurisdictions such as Australia, Belgium, France, Canada, and Germany. We are generally no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by taxing authorities for years before 2002. Since January 1, 2010, numerous states including Colorado, Maine, Utah, the District of Columbia and California have enacted legislation effective for tax years beginning on or after January 1, 2010, including requirements for combined reporting and changes to apportionment methods.

Stock-Based Compensation	6 Months Ended
Stock-Based Compensation	Jun. 30, 2010
Stock-Based Compensation [Abstract]
Stock-Based Compensation	9. Stock-Based Compensation: Our 2010 Incentive Plan, as amended and restated provides for various long-term incentive awards, which include stock options, performance share units, restricted stock units and stock appreciation rights. Net stock-based compensation expense of $3.4 million and $3.1 million was recognized for the second quarters of 2010 and 2009, respectively. Net stock-based compensation expense of $7.7 million and $5.2 million was recognized for the first six months of 2010 and 2009, respectively. These expenses are included in Selling, General and Administrative Expenses in the accompanying Consolidated Statements of Operations.