10.	Restructuring

The Company incurred restructuring costs in both continuing and discontinued operations. The discussion in this note relates to the combination of both continuing and discontinued operations unless otherwise noted. Restructuring costs related to discontinued operations are recorded in discontinued operations within the Company’s Consolidated Condensed Statements of Earnings and are discussed in Note 11, Discontinued Operations, in more detail.

In 2014, the Company announced the 2014 Restructuring Plan related to eliminating underperforming operations, consolidating manufacturing facilities and improving efficiencies within the Company. The 2014 Restructuring Plan will impact several facilities and will generate cost savings estimated to be approximately $30 million per year. The savings will be realized over the next few years and the full benefit is expected to be achieved after 2016. The actual amount of savings and costs could vary based upon changes in exchange rates and other assumptions. The Company also anticipates that the 2014 Restructuring Plan will include a reduction of approximately 350 positions, primarily direct and indirect manufacturing labor. In connection with the 2014 Restructuring Plan, approximately 110 positions were eliminated as of March 31, 2015, and approximately $1.5 million of savings were recognized in continuing operations for the three months ended March 31, 2015.

The Company determined that certain long-lived assets, including land, buildings and certain pieces of equipment associated with the identified operations, were impaired. As a result, the Company has reduced the carrying amounts of these assets to their aggregate respective fair values which were determined based on independent market valuations for these assets. During the current quarter, the Company sold two facilities as a result of the 2014 Restructuring Plan which generated net cash proceeds of $12.6 million and a combined net gain of $1.3 million which is recorded in the current quarter’s restructuring expense. The fair values of the remaining long-lived assets are estimated to be approximately $21.7 million. Also, certain machinery and equipment has been identified to be disposed of at the time of the facility closures, and the associated depreciation has been accelerated. In addition, certain intangible assets and inventory were determined to be impaired and were written down.

For the three months ended March 31, 2015, the Company recorded restructuring and other costs of $7.1 million ($5.5 million after-tax), in accordance with GAAP and based on an internal review of the affected facilities and consultation with legal and other advisors. For the three months ended March 31, 2014, the Company recorded restructuring and other costs of $52.7 million ($37.4 million after-tax). Included within the restructuring and other costs, the Company incurred $0.9 million related to the 2014 proxy contest.

The Company evaluates performance based on operating income of each segment before restructuring costs. The restructuring and other costs related to continuing operations are recorded in the Corporate & Other segment. The following table summarizes the restructuring and other costs by segment and discontinued operations for the three months ended March 31, 2015 and 2014:

	Three Months Ended March 31,
(In thousands)	2015		2014
Flavors & Fragrances	$	5,829	$	44,983
Color		161		-
Corporate & Other		1,125		1,204

Total Continuing Operations		7,115		46,187

Discontinued Operations		29		6,535

Total Restructuring	$	7,144	$	52,722

The Company recorded restructuring and other charges in continuing operations for the three months ended March 31, 2015 as follows:

(In thousands)	Selling & Administrative			Cost of Products Sold		Total
Employee separation	$	1,908		$	-	$	1,908
Long-lived asset impairment		3,815			-		3,815
Gain on asset sales		(1,301	)		-		(1,301	)
Write-down of inventory		-			141		141
Other costs⁽¹⁾		2,552			-		2,552

Total	$	6,974		$	141	$	7,115

⁽¹⁾

Other costs include decommissioning costs, professional services, moving costs and other related costs.

The Company expects to incur approximately $19 million of additional restructuring costs by the end of December 2015 and $6 million of additional restructuring costs by the end of 2016, consisting primarily of employee separations, asset impairments, and other restructuring related costs.These estimates relate to both continuing operations and discontinued operations.

The Company recorded restructuring and other charges in continuing operations for the three months ended March 31, 2014 as follows:

(In thousands)	Selling & Administrative			Cost of Products Sold		Total
Employee separation	$	11,267		$	-	$	11,267
Long-lived asset impairment		34,230			-		34,230
Gain on asset sales		(602	)		-		(602	)
Write-down of inventory		-			-		-
Other costs⁽¹⁾		1,292			-		1,292

Total	$	46,187		$	-	$	46,187

⁽¹⁾

Other costs include decommissioning, professional services, personnel moving costs, other related costs and 2014 proxy contest costs.

The following table summarizes the accrual for the restructuring and other charges for the three months ended March 31, 2015:

(In thousands)	Employee Separations			Asset Related and Other			Total
Balance as of December 31, 2014	$	14,909		$	897		$	15,806
Restructuring and other costs		2,015			5,129			7,144
Gain on sale of assets		-			1,301			1,301
Cash spent		(1,964	)		(2,884	)		(4,848	)
Reduction of assets		-			(3,904	)		(3,904	)
Translation adjustment		(1,337	)		-			(1,337	)
Balance as of March 31, 2015	$	13,623		$	539		$	14,162