Exit and Disposal Activities

12 Months Ended

Dec. 31, 2017

Restructuring and Related Activities [Abstract]

Exit and Disposal Activities

—Exit and Disposal Activities

The Company has undertaken operational restructuring and other cost reduction actions to streamline processes and manage costs throughout various departments within the Company. The Company implemented cost reduction plans, which resulted in exit, disposal and employee termination benefit costs, primarily resulting from planned reductions in workforce, facility consolidations and relocations and lease termination costs, as further discussed below by operating segment.

CIT

During 2017, the Company initiated plans to relocate certain of its aerospace manufacturing operations in Littleborough, United Kingdom to an existing manufacturing operation in Nogales, Mexico. During 2017, exit and disposal costs totaled $2.0 million. This project was substantially complete as of December 31, 2017.

As previously announced, the Company is incurring costs to relocate certain of its medical manufacturing operations in Shenzhen, China to a new manufacturing operation in Dongguan, China. During 2017, employee termination benefit costs associated with this plan totaled $6.1 million. Cumulative exit and disposal costs recognized totaled $14.1 million through December 31, 2017, with total costs expected to approximate $15.2 million. The remaining costs are expected to be incurred principally through the second half of 2018. Other associated costs are not expected to be significant.

During the third quarter of 2017, the Company entered into a letter of undertaking with the Chinese government, whereby the Company designated $10.1 million in cash specifically for the payment of employee termination benefits associated with the Chinese medical business action discussed above. Cash payments began in August 2017 out of these designated funds and will continue through the first half of 2018. The designated cash balance as of December 31, 2017, totaled $4.6 million.

CFT

During 2017, the Company initiated plans to restructure its global footprint. These plans involve exiting manufacturing operations in Brazil and Mexico, exiting the systems sales business in Germany and relocating the manufacturing operations currently in Angola, Indiana to its existing Bournemouth, United Kingdom manufacturing operations. During 2017, exit and disposal costs totaled $10.4 million, primarily reflecting employee termination benefit costs and accelerated depreciation. Total costs are expected to approximate $10.5 million, with the remaining costs expected to be incurred in first-quarter 2018.

As previously announced, the Company is incurring costs related to the relocation of CFT's administrative functions and facilities within the U.S. During 2017, exit and disposal cost totaled $1.0 million, primarily reflecting relocation and facility closure costs. This project was substantially complete as of December 31, 2017, with cumulative exit and disposal costs of $5.1 million.

CBF

During 2017, the Company announced that it would exit its manufacturing operations in Tulsa, Oklahoma and relocate the majority of those operations to its existing manufacturing facility in Medina, Ohio. This action is expected to take approximately 18 to 21 months to complete. Total associated exit and disposal costs are expected to be between $17.5 million to $21.0 million, including:

• Non-cash accelerated depreciation of long-lived assets at the Oklahoma facility, which is primarily property, plant and equipment that will not be transferred to Ohio (between $5.0 million to $6.5 million expected to be recognized ratably through the first quarter of 2019),

• Costs to relocate and install equipment (between $5.0 million to $6.0 million, expected to be incurred primarily in the second half of 2018),

• Employee retention and termination benefits (approximately $2.5 million, expected to be incurred ratably through the second half of 2018),

• Other associated costs related to the closure of the facility and internal administration of the project (between $5.0 million to $6.0 million, expected to be incurred primarily in the second half of 2018).

During 2017, exit and disposal expense totaled $5.1 million, primarily related to employee termination benefits and accelerated depreciation.

Consolidated Summary

Exit and disposal costs by activity for the years ended December 31 follows:

(in millions)	2017		2016		2015
Employee severance and benefit arrangements	$	17.8	$	10.1	$	—
Accelerated depreciation	3.7		0.4		—
Relocation costs	1.5		3.8		—
Other restructuring costs	3.8		1.2		0.5
Total exit and disposal costs	$	26.8	$	15.5	$	0.5

Exit and disposal costs by segment for the years ended December 31 follows:

(in millions)	2017		2016		2015
Carlisle Interconnect Technologies	9.5		$	7.6	$	—
Carlisle Fluid Technologies	11.4		4.1		—
Carlisle Brake & Friction	5.1		—		0.5
Corporate	0.8		3.8		—
Total exit and disposal costs	$	26.8	$	15.5	$	0.5

Exit and disposal costs by financial statement line item for the years ended December 31 follows:

(in millions)	2017		2016		2015
Cost of goods sold	10.9		$	—	$	0.5
Selling and administrative expenses	15.8		15.0		—
Research and development expenses	0.1		—		—
Other operating (income) expense, net	—		0.5		—
Total exit and disposal costs	$	26.8	$	15.5	$	0.5

Changes in exit and disposal liabilities for the years ended December 31 follows:

(in millions)	CIT			CFT			CBF			Corporate			Total
Balance as of December 31, 2016	$	7.6		$	0.7		$	—		$	0.7		$	9.0
Charges	9.5			11.4			5.1			0.8			26.8
Cash payments	(12.2		)	(3.9		)	(1.5		)	(1.5		)	(19.1		)
Other adjustments and non-cash settlements	—			(1.5		)	(2.1		)	—			(3.6		)
Balance as of December 31, 2017	$	4.9		$	6.7		$	1.5		$	—		$	13.1

The liability of $13.1 million as of December 31, 2017, primarily relates to employee severance and benefit arrangements and is included in accrued expenses in the Consolidated Balance Sheet.