RATIONALIZATION CHARGES

12 Months Ended

Dec. 31, 2022

Restructuring and Related Activities [Abstract]

We continually evaluate cost reduction opportunities across each of our segments, including rationalizations of our existing facilities through plant closings and downsizings. We use a disciplined approach to identify opportunities that generate attractive cash returns. Rationalization charges by segment for each of the years ended December 31 were as follows:


	2022		2021		2020
	(Dollars in thousands)
Dispensing and Specialty Closures	$	944	$	5,806	$	5,759
Metal Containers	73,137		8,873		9,905
Custom Containers	—		331		367
	$	74,081	$	15,010	$	16,031

In the fourth quarter of 2022, we recognized a rationalization charge of $73.8 million in the metal containers segment related to the write-off of net assets to service the Russian market. We are in the process of shutting down our two metal container manufacturing facilities in Russia.

In 2019, we withdrew from the Central States, Southeast and Southwest Areas Pension Plan, or the Central States Pension Plan, and estimated total rationalization expenses and cash expenditures from such withdrawal of $62.0 million at that time. In addition, we estimated our annual expense and cash expenditures related to such withdrawal to be approximately $1.1 million and $3.1 million, respectively, which we expected to continue through 2040. Through September 30, 2022, we recognized $46.0 million of rationalization charges for the present value of the withdrawal liability and annual accretion of interest and expended $8.3 million of cash in respect of such withdrawal.

In the fourth quarter of 2022, we finalized the calculation of the withdrawal liability with the Central States Pension Plan and revised the total expected costs of the withdrawal liability as of the withdrawal date to be $51.1 million, with expected total future cash expenditures of $41.9 million. Accordingly, the fourth quarter of 2022 includes a rationalization credit of $8.5 million in the metal containers segment for the adjustment to the withdrawal liability for the Central States Pension Plan as finalized. Remaining expenses related to the accretion of interest for the withdrawal liability for the Central States Pension Plan are expected to be approximately $0.9 million per year to be recognized annually through 2040, and remaining cash expenditures for the withdrawal liability related to the Central States Pension Plan are expected to be approximately $0.8 million in 2023 and $2.6 million per year thereafter through 2040.

Activity in reserves for our rationalization plans was as follows:


	Employee Severance and Benefits		Plant Exit Costs		Non-Cash Asset Write-Down		Total
	(Dollars in thousands)
Balance as of January 1, 2020	$	42,815	$	898	$	—	$	43,713
Charged to expense	8,525		2,296		5,210		16,031
Utilized and currency translation	(10,335)		(2,639)		(5,210)		(18,184)
Balance at December 31, 2020	41,005		555		—		41,560
Charged to expense	8,048		1,882		5,080		15,010
Utilized and currency translation	(7,963)		(2,280)		(5,080)		(15,323)
Balance at December 31, 2021	41,090		157		—		41,247
Charged to expense	(1,657)		1,205		74,533		74,081
Utilized and currency translation	(7,792)		(1,203)		(74,533)		(83,528)
Balance at December 31, 2022	$	31,641	$	159	$	—	$	31,800

Non-cash asset write-downs were the result of comparing the carrying value of certain production related equipment to their fair value using estimated future discounted cash flows, a Level 3 fair value measurement (see Note 10 for information regarding a Level 3 fair value measurement).

Rationalization reserves as of December 31, 2022 and 2021 were recorded in our Consolidated Balance Sheets as accrued liabilities of $3.9 million and $5.6 million, respectively, and as other liabilities of $27.9 million and $35.6 million, respectively. Excluding the impact of our withdrawal from the Central States Pension Plan discussed above, remaining expenses and cash expenditures for our rationalization plans are expected to be $1.9 million and $6.8 million, respectively.