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Realignment Programs | 9 Months Ended
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Sep. 30, 2023
Restructuring and Related Activities [Abstract] |
Realignment Programs | Realignment Programs In the second quarter of 2020, we identified and initiated certain realignment activities to right-size our organizational operations based on the current business environment, with the overall objective to reduce our workforce costs, including manufacturing optimization through the consolidation of certain facilities ("2020 Realignment Program"). As of December 31, 2022, the 2020 Realignment Program was substantially complete with a minimal amount of residual charges to be incurred prospectively. In the first quarter of 2023, we identified and initiated certain realignment activities concurrent with the consolidation of our aftermarket and pump operations into a single operating model. This consolidated operating model is designed to better align our go to market strategy with our product offerings, enable end-to-end lifecycle responsibility and accountability, and to facilitate more efficient operations. Additionally, we committed to an estimated $50 million in cost reduction efforts to begin in 2023. Collectively, the above realignment activities are referred to as the 2023 Realignment Program ("2023 Realignment Program"). The 2023 Realignment Program activities will be identified and implemented in phases throughout 2023. The realignment activities consist of restructuring and non-restructuring charges. Restructuring charges represent costs associated with the relocation of certain business activities and facility closures and include related severance costs. Non-restructuring charges are primarily employee severance associated with workforce reductions and professional service fees. Expenses are primarily reported in cost of sales ("COS") or selling, general and administrative ("SG&A"), as applicable, in our consolidated statements of income. We currently anticipate a total investment in realignment activities that have been evaluated and initiated of approximately $62 million of which $13 million is estimated to be non-cash. There are certain other realignment activities that are currently being evaluated, but have not yet been initiated and therefore are not included in the above anticipated total investment. Generally, the aforementioned charges will be paid in cash, except for asset write-downs, which are non-cash charges. The following is a summary of total charges, net of adjustments, incurred related to our Realignment Programs:
| Three Months Ended September 30, 2023
(Amounts in thousands) | FPD |  | FCD |  | Subtotal–Reportable Segments |  | All Other |  | Consolidated Total
Realignment Charges |  |  |  |  |  |  |  |  |
Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | 173 |  |  | $ | — |  |  | $ | 173 |  |  | $ | — |  |  | $ | 173 |
SG&A | — |  |  | 1 |  |  | 1 |  |  | (1) |  |  | — |
| $ | 173 |  |  | $ | 1 |  |  | $ | 174 |  |  | $ | (1) |  |  | $ | 173 |
Non-Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | 5,968 |  |  | $ | 1,099 |  |  | $ | 7,067 |  |  | $ | — |  |  | $ | 7,067 |
SG&A | 9,929 |  |  | 1,571 |  |  | 11,500 |  |  | 3,454 |  |  | 14,954 |
| $ | 15,897 |  |  | $ | 2,670 |  |  | $ | 18,567 |  |  | $ | 3,454 |  |  | $ | 22,021 |
Total Realignment Charges |  |  |  |  |  |  |  |  |
COS | $ | 6,141 |  |  | $ | 1,099 |  |  | $ | 7,240 |  |  | $ | — |  |  | $ | 7,240 |
SG&A | 9,929 |  |  | 1,572 |  |  | 11,501 |  |  | 3,453 |  |  | 14,954 |
Total | $ | 16,070 |  |  | $ | 2,671 |  |  | $ | 18,741 |  |  | $ | 3,453 |  |  | $ | 22,194 |
| Three Months Ended September 30, 2022
(Amounts in thousands) | FPD |  | FCD |  | Subtotal–Reportable Segments |  | All Other |  | Consolidated Total
Realignment Charges |  |  |  |  |  |  |  |  |
Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | (456) |  |  | $ | 26 |  |  | $ | (430) |  |  | $ | — |  |  | $ | (430) |
SG&A | — |  |  | 2 |  |  | 2 |  |  | — |  |  | 2 |
| $ | (456) |  |  | $ | 28 |  |  | $ | (428) |  |  | $ | — |  |  | $ | (428) |
Non-Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | 39 |  |  | $ | (4) |  |  | $ | 35 |  |  | $ | — |  |  | $ | 35 |
SG&A | 74 |  |  | 5 |  |  | 79 |  |  | 18 |  |  | 97 |
| $ | 113 |  |  | $ | 1 |  |  | $ | 114 |  |  | $ | 18 |  |  | $ | 132 |
Total Realignment Charges |  |  |  |  |  |  |  |  |
COS | $ | (417) |  |  | $ | 22 |  |  | $ | (395) |  |  | $ | — |  |  | $ | (395) |
SG&A | 74 |  |  | 7 |  |  | 81 |  |  | 18 |  |  | 99 |
Total | $ | (343) |  |  | $ | 29 |  |  | $ | (314) |  |  | $ | 18 |  |  | $ | (296) |
| Nine Months Ended September 30, 2023
(Amounts in thousands) | FPD |  | FCD |  | Subtotal–Reportable Segments |  | All Other |  | Consolidated Total
Realignment Charges |  |  |  |  |  |  |  |  |
Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | 571 |  |  | $ | — |  |  | $ | 571 |  |  | $ | 66 |  |  | $ | 637 |
SG&A | — |  |  | 8,877 |  |  | 8,877 |  |  | — |  |  | 8,877 |
| $ | 571 |  |  | $ | 8,877 |  |  | $ | 9,448 |  |  | $ | 66 |  |  | $ | 9,514 |
Non-Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | 6,913 |  |  | $ | 4,263 |  |  | $ | 11,176 |  |  | $ | (265) |  |  | $ | 10,911 |
SG&A | 11,996 |  |  | 1,601 |  |  | 13,597 |  |  | 16,602 |  |  | 30,199 |
| $ | 18,909 |  |  | $ | 5,864 |  |  | $ | 24,773 |  |  | $ | 16,337 |  |  | $ | 41,110 |
Total Realignment Charges |  |  |  |  |  |  |  |  |
COS | $ | 7,484 |  |  | $ | 4,263 |  |  | $ | 11,747 |  |  | $ | (199) |  |  | $ | 11,548 |
SG&A | 11,996 |  |  | 10,478 |  |  | 22,474 |  |  | 16,602 |  |  | 39,076 |
Total | $ | 19,480 |  |  | $ | 14,741 |  |  | $ | 34,221 |  |  | $ | 16,403 |  |  | $ | 50,624 |
| Nine Months Ended September 30, 2022
(Amounts in thousands) | FPD |  | FCD |  | Subtotal–Reportable Segments |  | All Other |  | Consolidated Total
Realignment Charges |  |  |  |  |  |  |  |  |
Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | 430 |  |  | $ | 97 |  |  | $ | 527 |  |  | $ | — |  |  | $ | 527 |
SG&A | — |  |  | 2 |  |  | 2 |  |  | — |  |  | 2 |
| $ | 430 |  |  | $ | 99 |  |  | $ | 529 |  |  | $ | — |  |  | $ | 529 |
Non-Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | (550) |  |  | $ | (41) |  |  | $ | (591) |  |  | $ | (61) |  |  | $ | (652) |
SG&A | 150 |  |  | 55 |  |  | 205 |  |  | (248) |  |  | (43) |
| $ | (400) |  |  | $ | 14 |  |  | $ | (386) |  |  | $ | (309) |  |  | $ | (695) |
Total Realignment Charges |  |  |  |  |  |  |  |  |
COS | $ | (120) |  |  | $ | 56 |  |  | $ | (64) |  |  | $ | (61) |  |  | $ | (125) |
SG&A | 150 |  |  | 57 |  |  | 207 |  |  | (248) |  |  | (41) |
Total | $ | 30 |  |  | $ | 113 |  |  | $ | 143 |  |  | $ | (309) |  |  | $ | (166) |
The following is a summary of total inception to date charges, net of adjustments, related to the 2023 Realignment Programs:
| Inception to Date
(Amounts in thousands) | FPD |  | FCD |  | Subtotal–Reportable Segments |  | All Other |  | Consolidated Total
Realignment Charges |  |  |  |  |  |  |  |  |
Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | 571 |  |  | $ | — |  |  | $ | 571 |  |  | $ | 66 |  |  | $ | 637 |
SG&A | — |  |  | 8,877 |  |  | 8,877 |  |  | — |  |  | 8,877 |
| $ | 571 |  |  | $ | 8,877 |  |  | $ | 9,448 |  |  | $ | 66 |  |  | $ | 9,514 |
Non-Restructuring Charges |  |  |  |  |  |  |  |  |
COS | $ | 6,913 |  |  | $ | 4,263 |  |  | $ | 11,176 |  |  | $ | (265) |  |  | $ | 10,911 |
SG&A | 11,996 |  |  | 1,601 |  |  | 13,597 |  |  | 16,602 |  |  | 30,199 |
| $ | 18,909 |  |  | $ | 5,864 |  |  | $ | 24,773 |  |  | $ | 16,337 |  |  | $ | 41,110 |
Total Realignment Charges |  |  |  |  |  |  |  |  |
COS | $ | 7,484 |  |  | $ | 4,263 |  |  | $ | 11,747 |  |  | $ | (199) |  |  | $ | 11,548 |
SG&A | 11,996 |  |  | 10,478 |  |  | 22,474 |  |  | 16,602 |  |  | 39,076 |
Total | $ | 19,480 |  |  | $ | 14,741 |  |  | $ | 34,221 |  |  | $ | 16,403 |  |  | $ | 50,624 |
Restructuring charges represent costs associated with the relocation or reorganization of certain business activities and facility closures and include costs related to employee severance at closed facilities, contract termination costs, asset write-downs and other costs. Severance costs primarily include costs associated with involuntary termination benefits. Contract termination costs include costs related to the termination of operating leases or other contract termination costs. Asset write-downs include accelerated depreciation of fixed assets, accelerated amortization of intangible assets, divestiture of certain non-strategic assets and inventory write-downs. Other costs generally include costs related to employee relocation, asset relocation, vacant facility costs (i.e., taxes and insurance) and other charges. The following is a summary of restructuring charges, net of adjustments, for our restructuring activities related to our Realignment Programs:
| Three Months Ended September 30, 2023
(Amounts in thousands) | Severance |  | Contract Termination |  | Asset Write-Downs (Gains) |  | Other |  | Total
COS | $ | 2 |  |  | $ | — |  |  | $ | — |  |  | $ | 171 |  |  | $ | 173 |
SG&A | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total | $ | 2 |  |  | $ | — |  |  | $ | — |  |  | $ | 171 |  |  | $ | 173 |
| Three Months Ended September 30, 2022
(Amounts in thousands) | Severance |  | Contract Termination |  | Asset Write-Downs (Gains) |  | Other |  | Total
COS | $ | (309) |  |  | $ | — |  |  | $ | (89) |  |  | $ | (32) |  |  | $ | (430) |
SG&A | 12 |  |  | — |  |  | — |  |  | (10) |  |  | 2 |
Total | $ | (297) |  |  | $ | — |  |  | $ | (89) |  |  | $ | (42) |  |  | $ | (428) |
| Nine Months Ended September 30, 2023
(Amounts in thousands) | Severance |  | Contract Termination |  | Asset Write-Downs (Gains) |  | Other |  | Total
COS | $ | 443 |  |  | $ | 294 |  |  | $ | (1,270) |  |  | $ | 1,170 |  |  | $ | 637 |
SG&A | — |  |  | — |  |  | 8,871 |  |  | 6 |  |  | 8,877 |
Total | $ | 443 |  |  | $ | 294 |  |  | $ | 7,601 |  |  | $ | 1,176 |  |  | $ | 9,514 |
| Nine Months Ended September 30, 2022
(Amounts in thousands) | Severance |  | Contract Termination |  | Asset Write-Downs (Gains) |  | Other |  | Total
COS | $ | 260 |  |  | $ | — |  |  | $ | 170 |  |  | $ | 97 |  |  | $ | 527 |
SG&A | 12 |  |  | — |  |  | — |  |  | (10) |  |  | 2 |
Total | $ | 272 |  |  | $ | — |  |  | $ | 170 |  |  | $ | 87 |  |  | $ | 529 |
The following is a summary of total inception to date restructuring charges, net of adjustments, related to our 2023 Realignment Programs:
| Inception to Date
(Amounts in thousands) | Severance |  | Contract Termination |  | Asset Write-Downs (Gains) |  | Other |  | Total
COS | $ | 443 |  |  | $ | 294 |  |  | $ | (1,270) |  |  | $ | 1,170 |  |  | $ | 637 |
SG&A | — |  |  | — |  |  | 8,871 |  |  | 6 |  |  | 8,877 |
Total | $ | 443 |  |  | $ | 294 |  |  | $ | 7,601 |  |  | $ | 1,176 |  |  | $ | 9,514 |
The following represents the activity, primarily severance charges from reductions in force, related to the restructuring reserves for the nine months ended September 30, 2023 and 2022:
(Amounts in thousands) | 2023 |  | 2022
Balance at January 1 | $ | 965 |  |  | $ | 4,868 |
Charges, net of adjustments | 1,912 |  |  | 359 |
Cash expenditures | (1,747) |  |  | (2,311) |
Other non-cash adjustments, including currency | (266) |  |  | (1,431) |
Balance at September 30 | $ | 864 |  |  | $ | 1,485 |

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