Business Restructuring

9 Months Ended

Sep. 30, 2016

Restructuring And Related Activities [Abstract]

15.	BUSINESS RESTRUCTURING

In May 2016, the Company announced plans to shut down its Longford Mills, Ontario, Canada manufacturing facility, a part of the Surfactants reportable segment, by December 31, 2016. Execution of this plan will result in a workforce reduction of approximately 30 employees. Production of goods currently manufactured at the facility will be moved to other Company North American production sites. The plant closure is expected to enable the Company to improve its asset utilization in North America and to further reduce the Company’s fixed cost base. In addition to $1,061,000 of termination benefits that were recognized in the three and six months ended June 30, 2016, the Company expects to incur approximately $3,000,000 of plant consolidation expenses, including decommissioning. The plant consolidation and decommissioning expenses are expected to be incurred in the fourth quarter of 2016 and into 2017. No significant plant consolidation expenses have been incurred as of September 30, 2016. Earlier in the year, the Company announced the discontinuation of ethoxylation production at the site in the first quarter of 2016.

Below is a reconciliation of the beginning and ending balances of the restructuring liability:

(In thousands)	Termination Benefits
Restructuring liability at June 30, 2016	$	1,061
Amounts paid		—
Foreign currency translation		(19	)
Restructuring liability at September 30, 2016	$	1,042

In addition to the restructuring costs, the Company reduced the useful lives of the manufacturing assets in the Longford Mills plant. As a result, the Company recognized $1,295,000 and $3,222,000 of additional depreciation expense for the three and nine months ended September 30, 2016, respectively (including first quarter depreciation of $1,084,000 related to the ethoxylation assets). The expense was included in the cost of sales line of the consolidated statements of income. The change in the useful lives of the assets will add approximately $1,300,000 of depreciation expense in the fourth quarter of 2016.