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Restructuring and Other Charges, Net | 3 Months Ended
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Mar. 29, 2015
Restructuring and Other Charges, Net |
Restructuring and Other Charges, Net | 5.Restructuring and Other Charges, Net The Company’s Board of Directors approves all major restructuring programs that involve the discontinuance of significant product lines or the shutdown of significant facilities. From time to time, the Company takes additional restructuring actions, including involuntary terminations that are not part of a major program. The Company accounts for these costs in the period that the individual employees are notified or the liability is incurred. These costs are included in restructuring and other charges in the Company’s consolidated statements of operations. A summary of the pre-tax cost by restructuring program is as follows:
|  | First Quarter Ended |
|  | March 29, 2015 |  | March 30, 2014 |
|  | (in millions) |
Restructuring costs: |  |  |  |  |
2015 Actions |  | $ | 1.3 |  | $ | — |
2013 Actions |  | 0.5 |  | 0.4 |
Other Actions |  | 0.2 |  | 3.8 |
Total restructuring and other charges, net |  | $ | 2.0 |  | $ | 4.2 |
The Company recorded pre-tax restructuring and other charges, net in its business segments as follows:
|  | First Quarter Ended |
|  | March 29, 2015 |  | March 30, 2014 |
|  | (in millions) |
Americas |  | $ | 1.3 |  | $ | 1.9 |
EMEA |  | 0.8 |  | 1.5 |
Corporate |  | (0.1 | ) | 0.8 |
Total |  | $ | 2.0 |  | $ | 4.2 |
2015 Actions On February 17, 2015, the Board of Directors of the Company approved the initial phase of a restructuring program relating to the transformation of the Company’s Americas and Asia-Pacific businesses, which primarily involves product line rationalization efforts relating to low margin, non-core products. The Company expects to ultimately eliminate between $175 million to $200 million of the combined Americas and Asia-Pacific net sales primarily within the Company’s do-it-yourself (DIY) distribution channel (the “program”). Assuming that the Company would wind-down the affected product lines, the program was initially expected to include a pre-tax charge to earnings of approximately $40 million to $50 million, of which $25 million to $30 million was expected to consist of non-cash charges. Recently, the Company received interest from prospective buyers, which may allow the Company to exit these product lines at a reduced cost. While it is still too early to determine the final method of disposition, the Company has revised the low end of the range of expected pre-tax charges to $27 million, of which $17 million consists of non-cash charges, to reflect the possibility that the product lines may be sold. As of March 29, 2015, the assets have not been classified as ‘Held for Sale’ as not all of the required criteria had been met. In connection with the preparation of the financial statements, during the fourth quarter and year ended December 31, 2014, the Company recorded a $15.2 million pre-tax charge relating to the program consisting of goodwill impairment of $12.9 million, an indefinite-lived intangible asset impairment of $0.5 million, and other transformation and deployment costs of $1.8 million recorded in SG&A. The goodwill impairment charge was based on a quantitative assessment of the Asia-Pacific reporting unit goodwill performed as a result of it being more likely than not that the Asia-Pacific reporting unit’s third party and intersegment net sales would be significantly reduced as a result of the program. During the first quarter ended March 29, 2015, the Company recorded a $1.3 million pre-tax restructuring charge and liability relating to facility site clean-up costs at one of the affected locations in the Americas and other transformation and deployment costs in SG&A of $1.5 million. Additional costs expected to be incurred relating to the program include costs of severance benefits of $1.6 million to $10 million, facility decommissioning, clean-up and other related exit costs of $1.7 million to $2.7 million, accelerated depreciation and amortization of long-lived assets of $1 million to $10 million, and other transformation and deployment costs including inventory charges, consulting fees, and other associated costs of $4.7 million to $9.3 million. The total net after-tax charge for this program is expected to be $22 million to $40 million, inclusive of the Asia-Pacific charges that are expected to have no tax benefit. The remaining costs are expected to be incurred in 2015. 2013 Actions On July 30, 2013, the Board of Directors authorized a restructuring program with respect to the Company’s EMEA segment to reduce its European manufacturing footprint, improve organizational and operational efficiency and better align costs with expected revenues in response to changing market conditions. Total pre-tax costs for the program were $8.4 million and were incurred from the third quarter of 2013 to the first quarter of 2015. The total charges for this program included costs for severance benefits, relocation, site clean-up, professional fees and certain asset write-downs. The total net after-tax charge for the restructuring program was approximately $5.9 million. The net after-tax charges incurred in the first quarter of 2015 and 2014 were $0.4 million and $0.3 million, respectively. Details of the Company’s 2013 European footprint program reserve, which for the first quarter ended March 29, 2015 relates only to severance, is as follows:
|  | First Quarter Ended |
|  | March 29, 2015 |
|  | (in millions) |
Balance at December 31, 2014 |  | $ | 1.5 |
Net pre-tax restructuring charges |  | 0.2 |
Utilization and foreign currency impact |  | (1.2 | )
Balance at March 29, 2015 |  | $ | 0.5 |
The following table summarizes total expected, incurred and remaining pre-tax costs for 2013 European footprint program actions by type, and all attributable to the EMEA reportable segment:
|  | Severance |  | Legal and consultancy |  | Asset write-downs |  | Facility exit and other |  | Total |
|  | (in millions) |
Expected costs |  | $ | 7.5 |  | $ | 0.2 |  | $ | 0.2 |  | $ | 0.5 |  | $ | 8.4 |
Costs incurred—2013 |  | (4.1 | ) | — |  | — |  | — |  | (4.1 | )
Costs incurred—2014 |  | (3.2 | ) | (0.2 | ) | (0.2 | ) | (0.2 | ) | (3.8 | )
Costs incurred—first quarter 2015 |  | (0.2 | ) | — |  | — |  | (0.3 | ) | (0.5 | )
Remaining costs at March 29, 2015 |  | $ | — |  | $ | — |  | $ | — |  | $ | — |  | $ | — |
Other Actions The Company also periodically initiates other actions which are not part of a major program. Total “Other Actions” pre-tax restructuring expense was $0.2 million and $3.8 million for the first quarters of 2015 and 2014, respectively. In the fourth quarter of 2014, management initiated certain restructuring actions and strategic initiatives with respect to the Company’s EMEA segment in response to the ongoing economic challenges in Europe and additional product rationalization. The restructuring actions primarily include expected severance benefits and limited costs relating to asset write offs, professional fees and relocation. The total pre-tax charge for these restructuring initiatives is expected to be approximately $9.9 million, of which approximately $7.2 million of pre-tax charges were incurred as of the first quarter of 2015 for the program to date. The remaining expected costs relate to severance, asset write-offs and relocation costs and are expected to be completed by the end of the fourth quarter of fiscal 2016. The restructuring reserve for these actions as of March 29, 2015 relates to the severance recorded in the prior year. The following table summarizes total expected, incurred and remaining pre-tax costs for the EMEA restructuring actions and strategic initiatives:
|  | Severance |  | Legal and consultancy |  | Asset write-downs |  | Facility exit and other |  | Total |
|  | (in millions) |
Expected costs |  | $ | 8.8 |  | $ | 0.2 |  | $ | 0.8 |  | $ | 0.1 |  | $ | 9.9 |
Costs incurred—2014 |  | (6.9 | ) | — |  | — |  | — |  | (6.9 | )
Costs incurred—first quarter 2015 |  | — |  | (0.2 | ) | (0.1 | ) | — |  | (0.3 | )
Remaining costs at March 29, 2015 |  | $ | 1.9 |  | $ | — |  | $ | 0.7 |  | $ | 0.1 |  | $ | 2.7 |
In 2014, the Company initiated restructuring activities in the Americas and Corporate to reduce costs through reductions-in-force. Total pre-tax restructuring expense of $2.7 million was incurred in the first quarter of 2014 relating to these initiatives. A final adjustment reducing restructuring expense by $0.1 million was recorded in the first quarter of 2015. There are no remaining expected costs associated with these activities.

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 5.P.3) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140864-122747 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 5 -Section P -Subsection 3, 4 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB TOPIC 5.P.4) -URI http://asc.fasb.org/extlink&oid=27011515&loc=d3e140904-122747 + Details
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