Exit activities

3 Months Ended

Mar. 31, 2020

Restructuring and Related Activities [Abstract]

EXIT ACTIVITIES

During 2019, the Company announced its plans to invest approximately $600 million in a new CRB paper machine in Kalamazoo, MI. In conjunction with the completion of this project, the Company currently expects to close two of its smaller CRB Mills in 2022 in order to remain capacity neutral.

In March 2020, the Company made the decision to close the White Pigeon, Michigan CRB mill and shut down the PM1 containerboard machine in West Monroe, Louisiana. Both will be effective June 30, 2020.

The Company accounts for the costs associated with these closures in accordance with ASC 360, Impairment or Disposal of Long-Lived Assets ("ASC 360"), ASC 420, Exit or Disposal Costs Obligations ("ASC 420") and ASC 712 Compensation-Nonretirement Post Employment Benefits ("ASC 712"). During the three months ended March 31, 2020, the Company recorded $17.6 million of exit costs. The Company did not record any exit costs during the three months ended March 31, 2019. Other costs associated with the start up of the new CRB paper machine will be recorded in the period in which they are incurred.

The following table summarizes the costs incurred during the three months ended March 31, 2020 related to these restructurings:


		Three Months Ended March 31,
In millions	Location in Statement of Operations	2020
Severance costs and other^(a)	Business Combinations and Shutdown and Other Special Charges, Net	$	4.5
Accelerated depreciation	Cost of Sales	4.6
Inventory and asset write-offs	Business Combinations and Shutdown and Other Special Charges, Net	8.5
Total		$	17.6

^(a) Costs incurred include activities for post-employment benefits, retention bonuses, incentives and professional services.

The following tables summarizes the balance of accrued expenses related to restructuring:


In millions
Balance at December 31, 2019	$	7.1
Costs incurred	4.3
Payments	(0.4)
Adjustments^(a)	0.2
Balance at March 31, 2020	$	11.2

^(a) Adjustments related to changes in estimates of severance costs.

In conjunction with the closure of the two smaller CRB Mills in 2022, the Company currently expects to incur exit activity charges for post-employment benefits, retention bonuses and incentives in the range of $15 million to $20 million and for accelerated depreciation and inventory and asset write-offs in the range of $50 million to $60 million. Through March 31, 2020, the Company has incurred cumulative exit activity charges for post-employment benefits, retention bonuses and incentives of $9.3 million and accelerated depreciation and inventory and asset write-offs of $11.8 million.

For the closure of the White Pigeon, Michigan CRB mill and the shut down of the PM1 containerboard machine in West Monroe, Louisiana, the Company currently expects to incur exit activity charges for post-employment benefits of approximately $4 million and for accelerated depreciation and inventory and asset write-offs in the range of $13 million to $18 million. Through March 31, 2020, the Company has incurred cumulative exit activity charges for post-employment benefits of $2.9 million and accelerated depreciation and inventory and asset write-offs of $8.5 million.