Restructuring Activities

9 Months Ended

Oct. 01, 2022

Restructuring and Related Activities [Abstract]

Summary of 2022 Restructuring Plan

In April 2022, management approved and commenced a restructuring plan that will better position us for stronger performance. The restructuring plan will mainly reduce headcount and consolidate facilities. As a result of this restructuring plan, we analyzed the need to write-down inventory and impair long-lived assets, including operating lease right-of-use assets. During the three and nine months ended October 1, 2022, we recorded total charges of $0.6 million and $3.8 million, respectively. As

of October 1, 2022, we estimate the remaining amount of charges related to this initiative will be $7.0 million to $10.0 million in total pre-tax restructuring charges through 2023. Of these charges, we estimate $5.0 million to $7.0 million to be cash payments for employee separation and other facility consolidation related expenses, and $2.0 million to $3.0 million to be non-cash charges for impairment of long-lived assets.

In the Electronics Systems segment, we recorded $0.1 million and $0.2 million during the three months ended October 1, 2022, for severance and benefits that were classified as restructuring charges and accelerated depreciation of property and equipment that was classified as restructuring charges, respectively. We recorded $1.4 million and $0.2 million during the nine months ended October 1, 2022, for severance and benefits that were classified as restructuring charges and accelerated depreciation of property and equipment that was classified as restructuring charges, respectively.

In the Structural Systems segment, we recorded zero, $0.3 million, and zero during the three months ended October 1, 2022 for inventory write down that was classified as cost of sales, severance and benefits that were classified as restructuring charges, and impairment of property and equipment that was classified as restructuring charges, respectively. We recorded $0.5 million, $1.4 million, and $0.3 million during the nine months ended October 1, 2022 for inventory write down that was classified as cost of sales, severance and benefits that were classified as restructuring charges, and impairment of property and equipment that was classified as restructuring charges, respectively.

Our restructuring activities during the nine months ended October 1, 2022 were as follows (in thousands):


	December 31, 2021		Nine Months Ended October 1, 2022								October 1, 2022
	Balance		Charges		Cash Payments		Non-Cash Payments		Change in Estimates		Balance
Severance and benefits	$	—	$	2,780	$	(1,423)	$	—	$	—	$	1,357

Property and equipment accelerated depreciation due to restructuring	—		186		—		(186)		—		—
Property and equipment impairment due to restructuring	—		304		—		(304)		—		—
Inventory write down	—		528		—		(528)		—		—
Ending balance	$	—	$	3,798	$	(1,423)	$	(1,018)	$	—	$	1,357

The restructuring activities accrual for severance and benefits of $1.4 million as of October 1, 2022 was included as part of accrued and other liabilities.