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Restructuring
12 Months Ended
Dec. 31, 2019
Restructuring and Related Activities [Abstract]  
Restructuring

5. Restructuring

In 2017, the Company announced a proposal to discontinue operations at its MC production facility in Sélestat, France. The restructuring program was driven by the Company’s need to balance manufacturing capacity with demand. During 2017, we incurred $1.1 million of restructuring expense associated with this proposal but were unable to reasonably estimate the total costs for severance and other charges associated with the proposal as there was no assurance, at that time, that approval for the proposal would be obtained. In 2018, the plan was approved by the French Labor Ministry which led to restructuring expense of $10.7 million in 2018, which includes severance and outplacement costs for the approximately 50 positions that were terminated under this plan. In 2019, restructuring charges were $0.9 million. Since 2017, we have recorded $12.7 million of restructuring charges related to this action. As a result of this action, we recorded a pension plan curtailment gain of $0.7 million in 2018 which is recorded in Other expense, net.

In 2016, the Company discontinued research and development activities at its MC facility in Sélestat, France as part of a plan to reduce research and development costs. This initiative resulted in 2016 expense of $2.2 million for severance, outplacement, and the write-off of equipment. In 2017 and 2018, we recorded additional restructuring charges of $1.6 million and $1.0 million respectively, related to a 2016 restructuring at the same location. Total restructuring costs for that initiative, including 2016, was $3.9 million

In 2017, the Company initiated work force reductions and facility rationalization in AEC locations in Salt Lake City, Utah and Rochester, New Hampshire. Restructuring charges include expenses of $0.1 million in 2019, $1.1 million in 2018, and $5.0 million in 2017. To date, we have recorded $6.2 million of restructuring charges related to these actions.

In 2018, the Company discontinued certain manufacturing processes at its AEC facility in Salt Lake City, Utah, which resulted in $1.9 million of restructuring in 2018, which included a non-cash restructuring charge of $1.7 million, and an additional $0.2 million for severance. The non-cash restructuring charge resulted from writing down manufacturing equipment used in that line of business to its estimated value. In 2019, the Company wrote off the remaining $1.2 million book value of that equipment as the Company has been unable to sell it. To date, we have recorded $3.1 million of restructuring charges related to these actions.

In 2017, the Company decided to discontinue the Bear Claw® line of hydraulic fracturing components used in the oil and gas industry, which was part of the AEC business. This decision resulted in a non-cash restructuring charge of $4.5 million in 2017 for the write-off of intangible assets and equipment, and a $2.8 million charge to Cost of goods sold for the write-off of inventory.

The following table summarizes charges reported in the Consolidated Statements of Income under “Restructuring expenses, net”:

Year ended December 31, 2019

(in thousands)

Total restructuring costs incurred

Termination and other costs

Impairment of assets

Machine Clothing

$1,129

$667

$462

Albany Engineered Composites

1,833

659

1,174

Corporate expenses

(57)

(57)

Total

$2,905

$1,269

$1,636

Year ended December 31, 2018

(in thousands)

Total restructuring costs incurred

Termination and other costs

Impairment of assets

Machine Clothing

$12,278

$11,890

$388

Albany Engineered Composites

3,048

1,286

1,762

Corporate expenses

244

244

Total

$15,570

$13,420

$2,150

74


ALBANY INTERNATIONAL CORP.

Notes to Consolidated Financial Statements

5. Restructuring — (continued)

 Year ended December 31, 2017

(in thousands)

Total restructuring costs incurred

Termination and other costs

Impairment of assets

Machine Clothing

$3,429

$2,945

$484

Albany Engineered Composites

10,062

5,004

5,058

Corporate expenses

Total

$13,491

$7,949

$5,542

 

We expect that approximately $1.3 million of Accrued liabilities for restructuring at December 31, 2019 will be paid within one year and approximately $0.7 million will be paid the following year.

The table below presents the changes in restructuring liabilities for 2019 and 2018, all of which related to termination costs:

(in thousands)

December 31, 2018

Restructuring charges accrued

Payments

Currency translation/other

December 31, 2019

Total termination and other costs

$5,570

$1,269

$(5,084)

$287

$2,042

(in thousands)

December 31,

2017

Restructuring charges accrued

Payments

Currency translation/other

December 31, 2018

Total termination and other costs

$3,326

$13,420

$(10,696)

$(480)

$5,570