XML 37 R24.htm IDEA: XBRL DOCUMENT v3.23.3
Business Reorganization
 9 Months Ended
Sep. 30, 2023
Restructuring and Related Activities [Abstract]  
Business Reorganization Business Reorganizations
In July 2022, Company management, commenced a systematic multi-phased initiative to significantly reduce costs and integrate the Company's operations, decreasing complexity and focusing on improved performance across Industrial. More specifically, at this time, the Company announced a restructuring program to further reduce costs within the Industrial segment and, more broadly, transform our businesses in response to macroeconomic disruptions. Additional actions were subsequently announced in October 2022, April 2023 (including Aerospace) and, most recently, during the current quarter, in September 2023. Management continues to adjust its cost structures to align with market conditions.

The Company authorized restructuring actions (“2022 Actions”) focused on the consolidation of two manufacturing sites and a number of branch offices and changes in infrastructure to eliminate certain roles across a number of locations in the Industrial segment businesses in July and October 2022. Resulting pre-tax charges of $17,986 were recorded in 2022. Of the aggregate, $11,880 related to employee termination costs, primarily employee severance and other termination benefits, which are expected to be paid in cash by the end of 2023 and which were recorded within Selling and administrative expenses. The remaining $6,106 primarily related to $3,186 of accelerated depreciation of assets and $1,417 of pension curtailment losses and special termination benefits which were recorded in Cost of sales and Other expense (income), net, respectively.

During the third quarter of 2023, additional pre-tax charges of $3,156, primarily related to site consolidation and transfer of work charges, were recorded within Cost of sales, $233 of expenses were recorded within Selling and administrative expenses in the accompanying Condensed Consolidated Statements of (Loss) Income.

During the first nine months of 2023, additional pre-tax charges of $9,120, including $3,185 of accelerated depreciation of assets, $6,073 primarily related to site consolidation and transfer of work charges, were recorded within Cost of sales, $1,006 primarily related to employee and other termination benefits, were recorded within Selling and administrative expenses, and $1,144 of pension curtailment and settlement gains recorded were included within Other income (expense), net, in the accompanying Condensed Consolidated Statements of (Loss) Income.

A corresponding liability of $2,879, per below, related to the employee termination costs remained and was included within accrued liabilities as of September 30, 2023. The Company expects to incur additional costs of approximately $1,000 in 2023 related to the 2022 Actions, primarily related to transfer of work charges, which is payable in cash. The 2022 Actions are expected to be predominately completed in 2023.

The following table sets forth the change in the liability for the employee termination benefits related to the 2022 Actions:
December 31, 2022$10,900 
Employee severance and other termination benefits(594)
Payments(7,427)
September 30, 2023$2,879 

In April 2023, the Company authorized additional restructuring actions (“April 2023 Actions”) focused on manufacturing footprint optimization, including the consolidation of manufacturing sites and optimization of production. These actions include the geographic transfer of certain programs within both the Industrial and Aerospace segments and changes in infrastructure to
drive improvements and efficiencies in business processes, including the elimination of certain roles across several locations. Resulting pre-tax charges of $9,519 were recorded in the second quarter of 2023. Of the aggregate, $9,163 related to employee termination costs, primarily employee severance and other termination benefits, which are expected to be paid in cash by the end of 2025 and which were recorded within Selling and administrative Expenses. The remaining $356 primarily related to accelerated rent expenses and consulting fees, which were recorded within Selling and administrative expenses, in the accompanying Condensed Consolidated Statements of (Loss) Income. Of the aggregate charges recorded, $9,294 was reflected within the results of the Industrial segment and $225 was reflected within the results of the Aerospace segment. During the third quarter of 2023, additional pre-tax charges of $624, primarily related to $682 of transfer of work charges, were recorded within Cost of sales and offset by $(58) of selling and administrative expenses, in the accompanying Condensed Consolidated Statements of (Loss) Income. Of the aggregate charges recorded, $603 was reflected within the results of the Industrial segment and $21 was reflected within the results of the Aerospace segment. A corresponding liability of $6,975, per below, related to the employee termination costs remained and was included within accrued liabilities as of September 30, 2023. The Company expects to incur additional costs of approximately $4,000 in 2023 related to the April 2023 Actions, including approximately $1,000 related to the Aerospace segment and $3,000 related to the Industrial segment, all of which is payable in cash. The Company also expects to incur additional costs beyond 2023 of approximately $12,000 related to the April 2023 Actions, which are primarily related to transfer of work charges. Of the aggregate, approximately $8,000 and $4,000 relate to the Aerospace and Industrial segments, respectively. The April 2023 Actions are expected to be completed throughout multiple periods, with completion in 2025.

The following table sets forth the change in the liability for the employee termination benefits related to the April 2023 Actions:
December 31, 2022$— 
Employee severance and other termination benefits8,938 
Payments(1,963)
September 30, 2023$6,975 

In September 2023, the Company authorized additional restructuring actions (“September 2023 Actions”) including organizational realignment within a Barnes Industrial business and within Barnes Aerospace following the MB Aerospace acquisition. Resulting pre-tax charges of $8,622 were recorded in the third quarter of 2023 related to employee termination costs, primarily employee severance and other termination benefits, which are expected to be paid in cash by the end of 2025 and which were recorded within Selling and administrative expenses in the accompanying Condensed Consolidated Statements of (Loss) Income. Of the aggregate charges recorded, $5,801 was reflected within the results of the Industrial segment and $2,821 was reflected within the results of the Aerospace segment. A corresponding liability of $7,320, per below, related to the employee termination costs remained and was included within accrued liabilities as of September 30, 2023. The Company does not expect any additional costs related to the September 2023 Actions to be significant.

The following table sets forth the change in the liability for the employee termination benefits related to the September 2023 Actions:
December 31, 2022$— 
Employee severance and other termination benefits8,622 
Payments(1,302)
September 30, 2023$7,320