Restructuring Activities

3 Months Ended

Apr. 01, 2023

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 months ended April 1, 2023, we recorded total charges of $4.2 million. Cumulative through the three months ended

April 1, 2023, we recorded aggregate total charges of $10.9 million ($0.5 million of which was recorded as cost of sales). As of April 1, 2023, we estimate the remaining amount of charges related to this initiative will be $8.0 million to $12.0 million in total pre-tax restructuring charges through 2023. Of these charges, we estimate $6.0 million to $9.0 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 $1.7 million, $0.1 million, and $0.1 million during the three months ended April 1, 2023, for severance and benefits that were classified as restructuring charges, accelerated depreciation of property and equipment that was classified as restructuring charges, and other restructuring charges, respectively. Cumulative through the three months ended April 1, 2023, we recorded total charges for severance and benefits that were classified as restructuring charges, accelerated depreciation of property and equipment that was classified as restructuring charges, and other restructuring charges of $5.2 million, $0.4 million, and $0.1 million, respectively.

In the Structural Systems segment, we recorded $1.7 million, $0.3 million, and $0.3 million during the three months ended April 1, 2023 for severance and benefits that were classified as restructuring charges, accelerated depreciation of property and equipment that was classified as restructuring charges, and other restructuring charges, respectively. Cumulative through the three months ended April 1, 2023, we recorded total charges for inventory write down that was classified as cost of sales, severance and benefits that were classified as restructuring charges, accelerated depreciation of property and equipment that was classified as restructuring charges, impairment of property and equipment that was classified as restructuring charges, and other restructuring charges of $0.5 million, $3.3 million, $0.8 million, $0.3 million, and $0.3 million, respectively.

Our restructuring activities during the three months ended April 1, 2023 were as follows (in thousands):


	December 31, 2022		Three Months Ended April 1, 2023								April 1, 2023
	Balance		Charges		Cash Payments		Non-Cash Payments		Change in Estimates		Balance
Severance and benefits	$	2,799	$	3,367	$	(1,377)	$	—	$	—	$	4,789

Property and equipment accelerated depreciation due to restructuring	—		427		—		(427)		—		—
Property and equipment impairment due to restructuring	—		—		—		—		—		—
Other	—		376		(376)		—		—		—
Ending balance	$	2,799	$	4,170	$	(1,753)	$	(427)	$	—	$	4,789

The restructuring activities accrual for severance and benefits of $4.8 million as of April 1, 2023 was included as part of accrued and other liabilities.