Exit and Disposal Activities

12 Months Ended

Dec. 31, 2018

Restructuring and Related Activities [Abstract]

—Exit and Disposal Activities

Beginning in the fourth quarter of 2016, and through 2018, the Company has undertaken operational restructuring and other cost reduction actions to streamline processes and manage costs throughout various departments. These actions resulted in exit, disposal and employee termination benefit costs, primarily resulting from planned reductions in workforce, facility consolidations and relocations and lease termination costs, as further discussed below by operating segment.

CBF

The Company is nearing completion on its project to exit its manufacturing operations in Tulsa, Oklahoma, and relocate the majority of those operations to its existing manufacturing facility in Medina, Ohio. During 2018, exit and disposal costs totaled $13.6 million, primarily reflecting equipment moving expenses, accelerated depreciation, employee

termination benefits and facility closure costs. Total costs are expected to approximate $20.7 million, with cumulative exit and disposal costs of $18.7 million recognized as of December 31, 2018. The remaining costs will be incurred throughout 2019.

CIT

The Company is substantially complete with the relocation of certain of its medical manufacturing operations in Shenzhen, China, to a new manufacturing operation in Dongguan, China. During 2018, exit and disposal costs totaled $1.5 million for employee termination benefit costs. The project is substantially complete with cumulative exit and disposal costs recognized of $15.5 million through December 31, 2018, and total cost expected to approximate $15.6 million.

During the third quarter of 2017, the Company entered into a letter of undertaking with the Chinese government, whereby the Company designated $10.1 million in cash specifically for the payment of employee termination benefits associated with the Chinese medical business action discussed above. Cash payments began in August 2017 and were completed in the second quarter of 2018.

CFT

During 2017, the Company initiated plans to restructure its global footprint. These plans involve exiting manufacturing operations in Brazil and Mexico, exiting the systems sales business in Germany, and relocating the manufacturing operations in Angola, Indiana, to its existing Bournemouth, United Kingdom, manufacturing operations. All facility closures were completed in the first quarter of 2018 and production moved to either the Jackson, Tennessee, or Bournemouth facilities. During 2018, exit and disposal costs totaled $1.1 million, primarily reflecting employee termination benefit costs and legal fees. This project is complete as of December 31, 2018, with cumulative exit and disposal costs of $11.3 million.

Consolidated Summary

Exit and disposal costs by activity follows:



(in millions)	2018		2017		2016
Equipment moving costs	$	5.6	$	0.4	$	—
Employee severance and benefit arrangements	3.2		17.8		10.1
Accelerated depreciation	2.3		3.7		0.4
Lease termination costs	1.1		—		—
Relocation costs	0.7		1.5		3.8
Other restructuring costs	5.0		3.4		1.2
Total exit and disposal costs	$	17.9	$	26.8	$	15.5

Exit and disposal costs by segment follows:



(in millions)	2018		2017		2016
Carlisle Brake & Friction	$	13.6	$	5.1	$	—
Carlisle Interconnect Technologies	3.2		$	9.5	$	7.6
Carlisle Fluid Technologies	1.1		11.4		4.1
Corporate	—		0.8		3.8
Total exit and disposal costs	$	17.9	$	26.8	$	15.5

Exit and disposal costs by financial statement line item follows:



(in millions)	2018		2017		2016
Cost of goods sold	$	15.5	$	10.9	$	—
Selling and administrative expenses	1.9		15.8		15.0
Research and development expenses	0.1		0.1		—
Other operating (income) expense, net	0.4		—		0.5
Total exit and disposal costs	$	17.9	$	26.8	$	15.5

Changes in exit and disposal liabilities follows:



(in millions)	CIT			CFT			CBF			Total
Balance as of December 31, 2017	$	4.9		$	6.7		$	1.5		$	13.1
Charges	3.2			1.1			13.6			17.9
Cash payments	(8.1		)	(7.5		)	(11.8		)	(27.4		)
Other adjustments and non-cash settlements	—			—			(2.4		)	(2.4		)
Balance as of December 31, 2018	$	—		$	0.3		$	0.9		$	1.2

The liability of $1.2 million as of December 31, 2018, primarily relates to employee severance and benefit arrangements and is included in accrued expenses.