Impairment and Restructuring Charge

6 Months Ended

Jun. 30, 2020

Impairment and Restructuring Charge

Impairment and Restructuring Charge

Note 13.  Impairment and Restructuring Charges

We recorded impairment and restructuring charges of $143.1 million in the six months ended June 30, 2020. In the first quarter of 2020, we recorded a $137.5 million impairment restructuring charge due to the significant decline in crude oil prices during the first quarter of 2020 that was expected to result in reduced drilling activity and decreased demand for the products we sell informed our decision during the first quarter of 2020 to close three of our energy-related businesses and reduce our long-term outlook for our businesses servicing the energy market.

The impairment and restructuring charges consisted of the following:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2020		2019		2020		2019
	(in millions)
Intangible assets, net	$	0.2	$	—	$	89.0	$	—
Property, plant and equipment		—		1.2		8.7		1.2
Operating lease right-of-use assets		—		—		0.2		—
Total impairment charges		0.2		1.2		97.9		1.2
Restructuring––cost of sales		—		—		39.8		—
Restructuring––warehouse, delivery, selling, general and administrative expense		5.4		—		5.4		—
Total impairment and restructuring charges	$	5.6	$	1.2	$	143.1	$	1.2

The 2020 property, plant and equipment and restructuring – cost of sales charges relate to the closure of certain locations where we anticipated losses on the disposition of certain real property, machinery and equipment and inventories. The measurement of the intangible assets at fair value was determined using discounted cash flow techniques. The use of discounted cash flow models requires significant judgment and requires the use of inputs by management that are

unobservable, including revenue forecasts, discount rates and long-term growth rates. Unobservable inputs are inputs that reflect the Company’s expectations of the assumptions market participants would use in pricing the eventual recovery of the oil and gas industry based on the best information available in the circumstances.