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Restructuring and other impairment charges | 12 Months Ended
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Dec. 31, 2015
Restructuring and Related Activities [Abstract] |
Restructuring and other impairment charges | Restructuring and other impairment charges 2015 Restructuring Programs During 2015, the Company committed to programs associated with the reorganization of certain businesses, as discussed in Note 16, and share service functions as well as the consolidation of certain facilities in North America. The Company estimates that it will record aggregate pre-tax charges of $6.5 million to $8.0 million related to these programs, which represent employee termination benefits, contract termination costs and facility closure and other exit costs, and will result in future cash outlays. For the year ended December 31, 2015, the Company recorded charges of $6.3 million related to these programs. As of December 31, 2015, the Company had a reserve of $3.3 million related to these programs. 2014 Manufacturing Footprint Realignment Plan In April 2014, the Board of Directors approved a restructuring plan (the “2014 Manufacturing Footprint Realignment Plan”) involving the consolidation of operations and a related reduction in workforce at certain of the Company’s facilities, and the relocation of manufacturing operations from certain higher-cost locations to existing lower-cost locations. These actions commenced in the quarter ended June 29, 2014 and are expected to be substantially completed by the end of 2017. The Company estimates that it will incur aggregate pre-tax charges in connection with the 2014 Manufacturing Footprint Realignment Plan of approximately $37 million to $44 million, of which the Company expects that an estimated $26 million to $31 million will relate to future cash outlays. Most of these charges are expected to be incurred prior to the end of 2016. The following table provides a summary of the Company’s current aggregate cost estimates by major type of expense associated with the 2014 Manufacturing Footprint Realignment Plan:
Type of expense | Total estimated amount expected to be incurred
Termination benefits | $11 million to $13 million
Facility closure and other exit costs (1) | $2 million to $3 million
Accelerated depreciation charges | $10 million to $11 million
Other (2) | $14 million to $17 million
| $37 million to $44 million
(1) | Includes costs to transfer product lines among facilities and outplacement and employee relocation costs.
(2) | Consists of other costs directly related to the plan, including project management, legal and regulatory costs.
For the year ended December 31, 2015, the Company recorded expenses of $11.2 million related to the 2014 Manufacturing Footprint Realignment Plan. Of this amount, $1.7 million was included in restructuring expense and related primarily to termination benefits and $9.5 million was included in cost of goods sold and related to accelerated depreciation and certain other costs resulting from the plan. As of December 31, 2015, the Company has incurred net aggregate restructuring expenses related to the plan of $10.9 million. Additionally, as of December 31, 2015, the Company has incurred net aggregate accelerated depreciation and certain other costs in connection with the plan of $14.4 million, which were included in cost of goods sold. As of December 31, 2015 and 2014, the Company had a restructuring reserve, all of which relates to termination benefits, of $7.4 million and $9.1 million, respectively, in connection with the plan. As the 2014 Manufacturing Footprint Realignment Plan progresses, management will reevaluate the estimated expenses and charges set forth above, and may revise its estimates, as appropriate, consistent with generally accepted accounting principles. 2014 European Restructuring Plan In February 2014, the Company committed to a restructuring plan (the “2014 European Restructuring Plan”), which impacts certain administrative functions in Europe and involves the consolidation of operations and a related reduction in workforce at certain of the Company’s European facilities. As of December 31, 2015, the Company has incurred net aggregate restructuring charges under the plan of $7.7 million. The Company expects future restructuring expenses associated with the 2014 European Restructuring Plan, if any, to be nominal. The Company expects to complete this plan in 2016. Other 2014 Restructuring Programs In June 2014, the Company initiated programs to consolidate locations in Australia and terminate certain European distributor agreements in an effort to reduce costs. As a result of these actions, the Company incurred aggregate restructuring charges of $3.6 million as of December 31, 2015. These programs include costs related to termination benefits, contract termination costs and other exit costs. The Company completed the programs in 2015. 2013 Restructuring Programs In 2013, the Company initiated restructuring programs to consolidate administrative and manufacturing facilities in North America and warehouse facilities in Europe and terminate certain European distributor agreements in an effort to reduce costs. As of December 31, 2015, the Company incurred net aggregate restructuring charges of $10.9 million related to these programs. These programs entail costs related to termination benefits, contract termination costs and charges related to facility closure and other exit costs. The Company completed the programs in 2015 LMA Restructuring Program In connection with the acquisition of substantially all of the assets of LMA International N.V. (the “LMA business”) in 2012, the Company commenced a program (the "LMA Restructuring Program") related to the integration of the LMA business and the Company’s other businesses. The program was focused on the closure of the LMA business’ corporate functions and the consolidation of manufacturing, sales, marketing, and distribution functions in North America, Europe and Asia. The Company incurred net aggregate restructuring charges related to the LMA Restructuring Program of $11.3 million. The Company completed the program in 2015. For the year ended December 31, 2014, the Company recorded a net credit of $3.3 million, primarily resulting from the reversal of contract termination costs following the favorable settlement of a terminated distributor agreement. 2012 Restructuring Program In 2012, the Company identified opportunities to improve its supply chain strategy by consolidating its three North American warehouses into one centralized warehouse, and lower costs and improve operating efficiencies through the termination of certain distributor agreements in Europe, the closure of certain North American facilities and workforce reductions. As of December 31, 2015, the Company has incurred net aggregate restructuring and impairment charges of $6.3 million in connection with this program, and expects future restructuring expenses associated with the program, if any, to be nominal. As of December 31, 2015, the Company has a reserve of $0.5 million in connection with the program. The Company expects to complete this program in 2016. Impairment Charges There were no impairment charges recorded for the years ended December 31, 2015 or 2014. In 2013, the Company recorded $7.3 million of IPR&D charges and $3.5 million in impairment charges related to assets held for sale that had a carrying value in excess of their appraised fair value. The restructuring and other impairment charges recognized for the years ended December 31, 2015, 2014 and 2013 consisted of the following:
| 2015
(dollars in thousands) | Termination Benefits |  | Facility Closure Costs |  | Contract Termination Costs |  | Other Exit Costs |  | Total
2015 Restructuring programs | $ | 5,009 |  |  | $ | 231 |  |  | $ | 1,000 |  |  | $ | 64 |  |  | $ | 6,304 |
2014 Manufacturing footprint realignment plan | $ | 1,007 |  |  | $ | 241 |  |  | $ | 389 |  |  | $ | 48 |  |  | $ | 1,685 |
Other restructuring programs - prior years(1) | $ | (194 | ) |  | $ | 2 |  |  | $ | (13 | ) |  | $ | 35 |  |  | $ | (170 | )
Total restructuring charges | $ | 5,822 |  |  | $ | 474 |  |  | $ | 1,376 |  |  | $ | 147 |  |  | $ | 7,819 |
(1) | Other restructuring programs - prior years includes the 2014 European restructuring plan, the Other 2014 restructuring programs, the 2013 Restructuring programs and the LMA restructuring program.
| 2014
(dollars in thousands) | Termination Benefits |  | Facility Closure Costs |  | Contract Termination Costs |  | Other Exit Costs |  | Total
2014 Manufacturing footprint realignment plan | $ | 9,200 |  |  | $ | — |  |  | $ | — |  |  | $ | 60 |  |  | $ | 9,260 |
2014 European restructuring plan | 7,237 |  |  | 1 |  |  | 345 |  |  | 225 |  |  | 7,808 |
Other 2014 restructuring programs | 552 |  |  | — |  |  | 2,754 |  |  | 244 |  |  | 3,550 |
LMA restructuring program | (29 | ) |  | (112 | ) |  | (3,188 | ) |  | — |  |  | $ | (3,329 | )
2013 Restructuring programs | 562 |  |  | — |  |  | 249 |  |  | 22 |  |  | 833 |
2012 Restructuring program | (619 | ) |  | 354 |  |  | — |  |  | — |  |  | (265 | )
2011 Restructuring plan | — |  |  | 12 |  |  | — |  |  | — |  |  | 12 |
Total restructuring charges | $ | 16,903 |  |  | $ | 255 |  |  | $ | 160 |  |  | $ | 551 |  |  | $ | 17,869 |
| 2013
(dollars in thousands) | Termination Benefits |  | Facility Closure Costs |  | Contract Termination Costs |  | Other Exit Costs |  | Total
LMA restructuring program | $ | 3,282 |  |  | $ | 788 |  |  | $ | 7,906 |  |  | $ | 176 |  |  | 12,152 |
2013 Restructuring programs | 4,787 |  |  | — |  |  | 3,326 |  |  | 2,117 |  |  | 10,230 |
2012 Restructuring program | 2,993 |  |  | 935 |  |  | 296 |  |  | 5 |  |  | 4,229 |
2011 Restructuring plan | — |  |  | 42 |  |  | 728 |  |  | — |  |  | 770 |
2007 Arrow integration program | — |  |  | 230 |  |  | — |  |  | — |  |  | 230 |
| $ | 11,062 |  |  | $ | 1,995 |  |  | $ | 12,256 |  |  | $ | 2,298 |  |  | $ | 27,611 |
Impairment charges | — |  |  | — |  |  | — |  |  | 10,841 |  |  | 10,841 |
Total restructuring and other impairment charges | $ | 11,062 |  |  | $ | 1,995 |  |  | $ | 12,256 |  |  | $ | 13,139 |  |  | 38,452 |
Termination benefits include employee retention, severance and benefit payments for terminated employees. Facility closure costs include general operating costs incurred subsequent to production shutdown as well as equipment relocation and other associated costs. Contract termination costs include costs associated with terminating existing leases and distributor agreements. Other costs include legal, outplacement and employee relocation costs and other employee-related costs. Restructuring charges by reportable operating segment for the years ended December 31, 2015, 2014, and 2013 are set forth in the following table:
| 2015 |  | 2014 |  | 2013
| (Dollars in thousands)
Vascular North America | $ | 3,742 |  |  | $ | 8,057 |  |  | $ | 5,348 |
Anesthesia North America | 384 |  |  | 1,379 |  |  | 2,959 |
Surgical North America | 397 |  |  | — |  |  | 6,525 |
EMEA | 4 |  |  | 6,375 |  |  | 16,122 |
Asia | 313 |  |  | 1,305 |  |  | 603 |
OEM | 61 |  |  | — |  |  | 588 |
All other | 2,918 |  |  | 753 |  |  | 6,307 |
Total restructuring charges | $ | 7,819 |  |  | $ | 17,869 |  |  | $ | 38,452 |

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- Definition The entire disclosure of costs incurred for restructuring including, but not limited to, exit and disposal activities, remediation, implementation, integration, asset impairment, and charges against earnings from the write-down of assets. + References No definition available. + Details
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