Restructuring and Other Charges

6 Months Ended

Jul. 02, 2023

Restructuring and Related Activities [Abstract]

Restructuring and Other Charges

RESTRUCTURING AND OTHER CHARGES

Restructuring, asset impairment and other charges were as follows:

	Three Months Ended				Six Months Ended
	July 2, 2023		July 3, 2022		July 2, 2023		July 3, 2022
	(in thousands)
Restructuring, asset impairment and other charges(1)	$	(2,644)	$	810	$	(2,502)	$	1,697

(1) Restructuring, asset impairment and other charges are attributable to the EAAA reportable segment.

2021 Restructuring Plan

On September 8, 2021, the Company committed to a new restructuring plan that continued to focus on efforts to improve efficiencies and decrease costs across its worldwide operations. The plan involved a reduction of approximately 188 employees and the closure of the Company’s manufacturing facility in Thailand at the end of the first quarter of 2022.

Expected charges and cumulative charges incurred to date under the 2021 restructuring plan are as follows:

	Workforce Reduction		Retention Bonuses		Asset Impairment and Other Related Charges		Total
	(in thousands)
Estimated expected charges(1)	$	2,281	$	474	$	3,295	$	6,050
Cumulative charges incurred to date(1)	2,281		474		3,295		6,050

(1) Charges are attributable to the EAAA reportable segment.

A summary of the restructuring reserve balance, recorded within accrued expenses in the consolidated condensed balance sheets, for the 2021 restructuring plan is presented below:

	Workforce Reduction		Retention Bonuses		Asset Impairment and Other Related Charges		Total
	(in thousands)
Balance, at January 1, 2023	$	277	$	179	$	—	$	456
Charged to expenses	23		(19)		174		178
Deductions	(300)		(160)		—		(460)
Charged to other accounts	—		—		(174)		(174)
Balance, at July 2, 2023	$	—	$	—	$	—	$	—

The Company recognized a gain of $2.7 million on the sale of the Thailand facility during the three months ended July 2, 2023. See Note 16 entitled “Assets Disposed” for additional information.

In addition, during the six months ended July 3, 2022, in conjunction with the closure of its Thailand facility, the Company recorded a write-down of inventory of $2.1 million within cost of sales in the consolidated condensed statements of operations.

The Company completed the 2021 restructuring plan in the second quarter of 2023, following the sale of the Thailand manufacturing facility, as described in Note 16 entitled “Assets Disposed,” and expects the plan to yield annualized savings of approximately $1.7 million. A portion of the annualized savings was realized on the consolidated condensed statements of operations in fiscal year 2022, with the remaining portion of the annualized savings expected to be realized in fiscal year 2023.