Restructuring Activities

6 Months Ended

Jul. 03, 2020

Restructuring and Related Activities [Abstract]

RESTRUCTURING ACTIVITIES

The Company’s restructuring activities are undertaken as necessary to implement management’s strategy, streamline operations, take advantage of available capacity and resources, and ultimately achieve net cost reductions. These activities generally relate to the realignment of existing manufacturing capacity and closure of facilities and other exit or disposal activities, as it relates to executing the Company’s strategy, either in the normal course of business or pursuant to significant restructuring programs. As of the end of the second quarter, the Company was unable to reasonably estimate an obligation for any future employee severance and other benefits related to the Company’s restructuring activities.

The Company initiated restructuring related activities during the six months ended July 3, 2020. The related liability, which is included in accrued liabilities in the Condensed Consolidated Balance Sheets, is summarized below ($ in millions):



	Employee Severance and Related			Facility Exit and Related			Total
Balance at December 31, 2019	$	5.6		$	—		$	5.6
Costs incurred	45.6			7.3			52.9
Paid/settled	(15.5		)	(5.2		)	(20.7		)
Balance at July 3, 2020	$	35.7		$	2.1		$	37.8

During the three months ended July 3, 2020, the Company made the decision to exit a portion of its treatment unit business, which is part of the Equipment & Consumables segment, as part of its strategy to restructure its portfolio and improve its cost structure. In connection with the planned exit, which is expected to be substantially complete by the end of the third quarter, the Company recognized a non-cash loss of $19 million. The majority of this loss included $9 million related to the impairment of certain intangible assets, which is included in selling, general and administrative expenses and $9 million of inventory write-offs, which is included in cost of sales. As soon as the production activities are completed, the Company expects to sell the manufacturing facility related to this business.

Restructuring related charges recorded for the three and six months ended July 3, 2020 and June 28, 2019, by segment were as follows ($ in millions):



	Three Months Ended				Six Months Ended
	July 3, 2020		June 28, 2019		July 3, 2020		June 28, 2019
Specialty Products & Technologies	$	15.7	$	3.5	$	16.5	$	3.2
Equipment & Consumables	41.2		1.3		52.0		3.6
Other	3.0		—		3.7		—
Total	$	59.9	$	4.8	$	72.2	$	6.8

The restructuring related charges incurred during the three and six months ended July 3, 2020 and June 28, 2019, are reflected in the following captions in the accompanying Condensed Consolidated and Combined Statements of Operations ($ in millions):



	Three Months Ended				Six Months Ended
	July 3, 2020		June 28, 2019		July 3, 2020		June 28, 2019
Cost of sales	$	23.9	$	0.9	$	26.7	$	1.8
Selling, general and administrative expenses	36.0		3.9		45.5		5.0
Total	$	59.9	$	4.8	$	72.2	$	6.8