XML 61 R9.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
RESTRUCTURING
 9 Months Ended
Dec. 28, 2019
Restructuring and Related Activities [Abstract]  
RESTRUCTURING
3. RESTRUCTURING

On an ongoing basis, the Company reviews the global economy, the healthcare industry, and the markets in which it competes to identify opportunities for efficiencies, enhance commercial capabilities, align its resources and offer its customers better solutions. In order to realize these opportunities, the Company undertakes restructuring-type activities to transform its business.

In July 2019, the Board of Directors of the Company approved a new Operational Excellence Program (the "2020 Program") and delegated authority to the Company's management to determine the detail of the initiatives that will comprise the program. The 2020 Program is designed to improve operational performance and reduce cost principally in our manufacturing and supply chain operations. The Company estimates that it will incur aggregate charges between $60 million and $70 million in connection with the 2020 Program. These charges, the majority of which will result in cash outlays, including severance and other employee costs, will be incurred as the specific actions required to execute these initiatives are identified and approved and are expected to be substantially completed by the end of fiscal 2023. During the three and nine months ended December 28, 2019, the Company incurred $3.9 million and $6.8 million, respectively, of restructuring and turnaround costs under this program. Total cumulative charges under this program are $6.8 million.

During fiscal 2018, the Company launched a Complexity Reduction Initiative (the "2018 Program"), a company-wide restructuring program designed to improve operational performance and reduce cost, freeing up resources to invest in accelerated growth. During the three and nine months ended December 28, 2019, the Company incurred $3.9 million and $6.8 million, respectively, of restructuring and turnaround costs under this program. During the three and nine months ended December 29, 2018, the Company incurred $1.9 million and $7.3 million, respectively, of restructuring and turnaround costs under this program. Total cumulative charges under this program are $57.0 million.

The following table summarizes the activity for restructuring reserves for the nine months ended December 28, 2019, substantially all of which relates to employee severance and other employee costs:
(In thousands)
 
2020 Program
 
2018 Program and Prior Programs
Balance at March 30, 2019
 
$
—

 
$
7,479

Costs incurred, net of reversals
 
1,409

 
1,520

Payments
 
(966
)
 
(6,440
)
Non-cash adjustments
 
—

 
(147
)
Balance at December 28, 2019
 
$
443

 
$
2,412



As of December 28, 2019, the Company had a restructuring liability of $2.9 million, of which $2.4 million is payable within the next twelve months.

The following presents the restructuring costs by line item within our accompanying condensed consolidated statements of income and comprehensive income:
 
Three Months Ended
 
Nine Months Ended
(In thousands)
December 28,
2019
 
December 29,
2018
 
December 28,
2019
 
December 29,
2018
Cost of goods sold
$
2

 
$
—

 
$
444

 
$
—

Research and development
139

 
56

 
708

 
112

Selling, general and administrative expenses
476

 
(750
)
 
1,777

 
(1,131
)
 
$
617

 
$
(694
)
 
$
2,929

 
$
(1,019
)


In addition to the restructuring costs included in the table above, the Company also incurred costs that do not constitute restructuring under ASC 420, Exit and Disposal Cost Obligations, which the Company refers to as turnaround costs. These costs, substantially all of which have been included as a component of selling, general and administrative expenses in the accompanying condensed consolidated statements of income, consist primarily of expenditures directly related to the
restructuring actions and include program management costs associated with the implementation of outsourcing initiatives and recent accounting standards.

The tables below present restructuring and turnaround costs by the Company's three reportable segments as well as the Company's other corporate restructuring and turnaround costs:
Restructuring costs
Three Months Ended
 
Nine Months Ended
(In thousands)
December 28, 2019
 
December 29, 2018
 
December 28, 2019
 
December 29, 2018
Plasma
$
4

 
$
47

 
$
552

 
$
(36
)
Blood Center
18

 
6

 
154

 
51

Hospital
58

 
132

 
295

 
(91
)
Corporate
537

 
(879
)
 
1,928

 
(943
)
Total
$
617

 
$
(694
)
 
$
2,929

 
$
(1,019
)
 
 
 
 
 
 
 
 
Turnaround costs
Three Months Ended
 
Nine Months Ended
(In thousands)
December 28, 2019
 
December 29, 2018
 
December 28, 2019
 
December 29, 2018
Plasma
$
108

 
$
80

 
$
187

 
$
123

Blood Center
293

 
182

 
293

 
182

Hospital
—

 
(68
)
 
—

 
(207
)
Corporate
6,780

 
2,254

 
10,173

 
8,142

Total
$
7,181

 
$
2,448

 
$
10,653

 
$
8,240

 
 
 
 
 

 
 
Total restructuring and turnaround costs
$
7,798

 
$
1,754

 
$
13,582

 
$
7,221