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Shareholders' Equity | 9 Months Ended
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Sep. 30, 2023
Equity [Abstract] |
Shareholders' Equity | Shareholders' Equity The quarterly changes in shareholders' equity during the nine months ended September 30, 2023 are as follows:
| Common Stock |  | Additional Paid-in Capital |  | Retained Earnings |  | Accumulated Other Comprehensive Income (Loss) |  | Treasury Stock |  | Total Shareholders' Equity |  | Redeemable Non-controlling Interests
(in millions, except per share data) | Shares |  | Amount |  |  |  |  |  |
Balance, December 31, 2022 | 20.8 |  |  | $ | 0.2 |  |  | $ | 299.2 |  |  | $ | 1,130.2 |  |  | $ | (33.3) |  |  | $ | (1.2) |  |  | $ | 1,395.1 |  |  | $ | 17.9 |
Net income | — |  |  | — |  |  | — |  |  | 37.4 |  |  | — |  |  | — |  |  | 37.4 |  |  | — |
Other comprehensive income | — |  |  | — |  |  | — |  |  | — |  |  | 7.1 |  |  | — |  |  | 7.1 |  |  | — |
Dividends ($0.29 per share) | — |  |  | — |  |  | — |  |  | (6.1) |  |  | — |  |  | — |  |  | (6.1) |  |  | — |
Incentive plan activity | 0.1 |  |  | — |  |  | 1.6 |  |  | — |  |  | — |  |  | — |  |  | 1.6 |  |  | — |
Balance, March 31, 2023 | 20.9 |  |  | $ | 0.2 |  |  | $ | 300.8 |  |  | $ | 1,161.5 |  |  | $ | (26.2) |  |  | $ | (1.2) |  |  | $ | 1,435.1 |  |  | $ | 17.9 |
Net loss | — |  |  | — |  |  | — |  |  | (18.6) |  |  | — |  |  | — |  |  | (18.6) |  |  | (4.2) |
Other comprehensive income | — |  |  | — |  |  | — |  |  | — |  |  | 5.1 |  |  | — |  |  | 5.1 |  |  | — |
Dividends ($0.29 per share) | — |  |  | — |  |  | — |  |  | (6.1) |  |  |  |  | — |  |  | (6.1) |  |  | — |
Incentive plan activity | — |  |  | — |  |  | 3.1 |  |  | — |  |  | — |  |  | — |  |  | 3.1 |  |  | — |
Other | — |  |  | — |  |  | (4.2) |  |  | — |  |  | — |  |  | — |  |  | (4.2) |  |  | 4.2 |
Balance, June 30, 2023 | 20.9 |  |  | $ | 0.2 |  |  | $ | 299.7 |  |  | $ | 1,136.8 |  |  | $ | (21.1) |  |  | $ | (1.2) |  |  | $ | 1,414.4 |  |  | $ | 17.9 |
Net income | — |  |  | — |  |  | — |  |  | 8.3 |  |  | — |  |  | — |  |  | 8.3 |  |  | (0.1) |
Other comprehensive loss | — |  |  | — |  |  | — |  |  | — |  |  | (11.5) |  |  | — |  |  | (11.5) |  |  | — |
Dividends ($0.29 per share) | — |  |  | — |  |  | — |  |  | (6.1) |  |  | — |  |  | — |  |  | (6.1) |  |  | — |
Incentive plan activity | — |  |  | — |  |  | 2.9 |  |  | — |  |  | — |  |  | — |  |  | 2.9 |  |  | — |
Other | — |  |  | — |  |  | (0.1) |  |  | — |  |  | — |  |  | — |  |  | (0.1) |  |  | 0.1 |
Balance, September 30, 2023 | 20.9 |  |  | $ | 0.2 |  |  | $ | 302.5 |  |  | $ | 1,139.0 |  |  | $ | (32.6) |  |  | $ | (1.2) |  |  | $ | 1,407.9 |  |  | $ | 17.9 |
The quarterly changes in shareholders' equity during the nine months ended September 30, 2022 are as follows:
| Common Stock |  | Additional Paid-in Capital |  | Retained Earnings |  | Accumulated Other Comprehensive Income (Loss) |  | Treasury Stock |  | Total Shareholders' Equity |  | Redeemable Non-controlling Interests
(in millions, except per share data) | Shares |  | Amount |  |  |  |  |  |
Balance, December 31, 2021 | 20.7 |  |  | $ | 0.2 |  |  | $ | 303.6 |  |  | $ | 953.1 |  |  | $ | 14.6 |  |  | $ | (1.2) |  |  | $ | 1,270.3 |  |  | $ | 50.1 |
Net income | — |  |  | — |  |  | — |  |  | 16.8 |  |  | — |  |  | — |  |  | 16.8 |  |  | 0.3 |
Other comprehensive loss | — |  |  | — |  |  | — |  |  | — |  |  | (11.7) |  |  | — |  |  | (11.7) |  |  | (1.0) |
Dividends ($0.28 per share) | — |  |  | — |  |  | — |  |  | (5.9) |  |  | — |  |  | — |  |  | (5.9) |  |  | — |
Incentive plan activity | 0.1 |  |  | — |  |  | (4.1) |  |  | — |  |  | — |  |  | — |  |  | (4.1) |  |  | — |
Other | — |  |  | — |  |  | 0.1 |  |  | — |  |  | — |  |  | — |  |  | 0.1 |  |  | (0.1) |
Balance, March 31, 2022 | 20.8 |  |  | $ | 0.2 |  |  | $ | 299.6 |  |  | $ | 964.0 |  |  | $ | 2.9 |  |  | $ | (1.2) |  |  | $ | 1,265.5 |  |  | $ | 49.3 |
Net income (loss) | — |  |  | — |  |  | — |  |  | 34.4 |  |  | — |  |  | — |  |  | 34.4 |  |  | (0.1) |
Other comprehensive loss | — |  |  | — |  |  | — |  |  | — |  |  | (14.9) |  |  | — |  |  | (14.9) |  |  | (1.1) |
Dividends ($0.28 per share) | — |  |  | — |  |  | — |  |  | (5.9) |  |  |  |  | — |  |  | (5.9) |  |  | — |
Incentive plan activity | — |  |  | — |  |  | 1.4 |  |  | — |  |  | — |  |  | — |  |  | 1.4 |  |  | — |
Balance, June 30, 2022 | 20.8 |  |  | $ | 0.2 |  |  | $ | 301.0 |  |  | $ | 992.5 |  |  | $ | (12.0) |  |  | $ | (1.2) |  |  | $ | 1,280.5 |  |  | $ | 48.1 |
Net income | — |  |  | — |  |  | — |  |  | 26.9 |  |  | — |  |  | — |  |  | 26.9 |  |  | 0.6 |
Other comprehensive loss | — |  |  | — |  |  | — |  |  | — |  |  | (31.3) |  |  | — |  |  | (31.3) |  |  | (1.8) |
Dividends ($0.28 per share) | — |  |  | — |  |  | — |  |  | (5.8) |  |  | — |  |  | — |  |  | (5.8) |  |  | — |
Incentive plan activity | — |  |  | — |  |  | 0.6 |  |  | — |  |  | — |  |  | — |  |  | 0.6 |  |  | — |
Other |  |  |  |  | (0.9) |  |  | (2.2) |  |  |  |  |  |  | (3.1) |  |  | 2.1 |
Balance, September 30, 2022 | 20.8 |  |  | $ | 0.2 |  |  | $ | 300.7 |  |  | $ | 1,011.4 |  |  | $ | (43.3) |  |  | $ | (1.2) |  |  | $ | 1,267.8 |  |  | $ | 49.0 |
We intend to declare regular quarterly cash dividends on our common stock, as determined by our board of directors, after taking into account our current and projected cash flows, earnings, financial position, debt covenants and other relevant factors. In accordance with the board of directors' declaration, total dividend payments of $18.3 million were made during the nine months ended September 30, 2023. In October 2023, our board of directors declared a dividend of $0.29 per share, payable on December 13, 2023, to all shareholders of record as of November 29, 2023. In October 2022, our board of directors authorized the expenditure of up to $50.0 million for the repurchase of our outstanding common shares through October 2024. We have not made any repurchases under this authorization or the prior two-year authorization which expired in October 2022. In 2023, we changed our performance share awards, granted under our equity compensation plan to executives and other key employees, to be paid in shares of our common stock at the end of the three-year vesting period. Awards issued prior to 2023 will be payable in cash at the end of the vesting period based upon the performance of EnPro’s share price relative to an industry peer group. Compensation expense related to performance shares granted in 2023 is computed using the fair value of the awards on the grant date, which is expensed on a straight-line basis over the three-year vesting period. Compensation expense for awards granted prior to 2023 is computed based upon the current estimate of total projected cash to be paid at vesting and the portion of the vesting period that has elapsed. In February 2023, we issued stock options to certain key executives for 0.1 million common shares with an exercise price of $116.69 per share. The options vest pro-rata on the first, second and third anniversaries of the grant date, subject to continued employment. No options have a term greater than 10 years. We determine the fair value of stock options using the Black-Scholes option pricing formula as of the grant date. Key inputs into this formula include expected term, expected volatility, expected dividend yield, and the risk-free interest rate. This fair value is amortized on a straight-line basis over the vesting period. The expected term represents the period that our stock options are expected to be outstanding, and is determined based on historical experience of similar awards, given the contractual terms of the awards, vesting schedules, and expectations of future employee behavior. The fair value of stock options reflects a volatility factor calculated using historical market data for EnPro's common stock. The time frame used was approximated as a six-year period from the grant date for the awards. The dividend assumption is based on our expectations as of the grant date. We base the risk-free interest rate on the yield to maturity at the time of the stock option grant on zero-coupon U.S. government bonds having a remaining life equal to the option's expected life. The option awards issued in February 2023 had a fair value of $45.13 per share at their grant date. The following assumptions were used to estimate the fair value of the 2023 option awards:
Average expected term | 6 years
Expected volatility | 39.75 | %
Risk-free interest rate | 4.22 | %
Expected dividend yield | 1.05 | %

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