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Realignment Programs

3 Months Ended

Mar. 31, 2024

Restructuring and Related Activities [Abstract]

Realignment Programs

Realignment Programs

In the first quarter of 2023, we identified and initiated certain realignment activities concurrent with the consolidation of our FPD 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. During 2023 we also initiated certain product and portfolio optimization activities. 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 Programs." The activities of the 2023 Realignment Programs were identified and implemented in phases throughout 2023 and are continuing into 2024. 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 the workforce reductions and professional service fees. Expenses are primarily reported in cost of sales ("COS") or SG&A, as applicable, in our condensed consolidated statements of income. We currently anticipate a total investment in realignment activities that have been evaluated and initiated of approximately $100 million of which $18 million is estimated to be non-cash. There are certain remaining realignment activities that are currently being evaluated, but have not yet been approved 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 2023 Realignment Programs:

			Three Months Ended March 31, 2024
(Amounts in thousands)			FPD						FCD						Subtotal–Reportable Segments						All Other						Consolidated Total
Realignment Charges
Restructuring Charges
COS			$	4,414					$	15					$	4,429					$	—					$	4,429
SG&A			701						—						701						—						701
			$	5,115					$	15					$	5,130					$	—					$	5,130
Non-Restructuring Charges
COS			$	630					$	752					$	1,382					$	(138)					$	1,244
SG&A			340						114						454						339						793
			$	970					$	866					$	1,836					$	201					$	2,037
Total Realignment Charges
COS			$	5,044					$	767					$	5,811					$	(138)					$	5,673
SG&A			1,041						114						1,155						339						1,494
Total			$	6,085					$	881					$	6,966					$	201					$	7,167

			Three Months Ended March 31, 2023
(Amounts in thousands)			FPD						FCD						Subtotal–Reportable Segments						All Other						Consolidated Total
Realignment Charges
Restructuring Charges
COS			$	(1,012)					$	—					$	(1,012)					$	66					$	(946)
SG&A			—						8,905						8,905						—						8,905
			$	(1,012)					$	8,905					$	7,893					$	66					$	7,959
Non-Restructuring Charges
COS			$	1,402					$	11					$	1,413					$	(265)					$	1,148
SG&A			2,050						1						2,051						5,721						7,772
			$	3,452					$	12					$	3,464					$	5,456					$	8,920
Total Realignment Charges
COS			$	390					$	11					$	401					$	(199)					$	202
SG&A			2,050						8,906						10,956						5,721						16,677
Total			$	2,440					$	8,917					$	11,357					$	5,522					$	16,879

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			$	7,376					$	6,420					$	13,796					$	66					$	13,862
SG&A			751						9,777						10,528						—						10,528
			$	8,127					$	16,197					$	24,324					$	66					$	24,390
Non-Restructuring Charges
COS			$	8,465					$	4,923					$	13,388					$	(565)					$	12,823
SG&A			14,823						1,730						16,553						19,438						35,991
			$	23,288					$	6,653					$	29,941					$	18,873					$	48,814
Total Realignment Charges
COS			$	15,841					$	11,343					$	27,184					$	(499)					$	26,685
SG&A			15,574						11,507						27,081						19,438						46,519
Total			$	31,415					$	22,850					$	54,265					$	18,939					$	73,204

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. Restructuring charges include charges related to approved, but not yet announced, facility closures.

The following is a summary of restructuring charges, net of adjustments, for our restructuring activities related to our 2023 Realignment Programs:

			Three Months Ended March 31, 2024
(Amounts in thousands)			Severance						Contract Termination						Asset Write-Downs (Gains)						Other						Total
COS			$	3,985					$	—					$	—					$	444					$	4,429
SG&A			701						—						—						—						701
Total			$	4,686					$	—					$	—					$	444					$	5,130

			Three Months Ended March 31, 2023
(Amounts in thousands)			Severance						Contract Termination						Asset Write-Downs (Gains)						Other						Total
COS			$	186					$	66					$	(1,303)					$	105					$	(946)
SG&A			5						—						8,900						—						8,905
Total			$	191					$	66					$	7,597					$	105					$	7,959

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			$	11,070					$	301					$	794					$	1,697					$	13,862
SG&A			1,651						—						8,871						6						10,528
Total			$	12,721					$	301					$	9,665					$	1,703					$	24,390

The following represents the activity, primarily severance charges from reductions in force, related to the restructuring reserves for the three months ended March 31, 2024 and 2023:

(Amounts in thousands)			2024						2023
Balance at January 1,			$	8,184					$	965
Charges, net of adjustments			5,130						362
Cash expenditures			(387)						(234)
Other non-cash adjustments, including currency			(849)						(55)
Balance at March 31,			$	12,078					$	1,038

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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/disclosureRef
-Topic 420
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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