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Restructuring and other impairment charges | 12 Months Ended
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Dec. 31, 2017
Restructuring and Related Activities [Abstract] |
Restructuring and other impairment charges | Restructuring and impairment charges The restructuring and impairment charges recognized for the years ended December 31, 2017, 2016, and 2015 consisted of the following:
| 2017
| Termination benefits |  | Facility closure and other exit costs |  | Contract termination costs |  | Total
| (Dollars in thousands)
2017 Vascular Solutions integration program | $ | 5,377 |  |  | $ | 118 |  |  | $ | — |  |  | $ | 5,495 |
2017 EMEA restructuring program | 4,921 |  |  | 280 |  |  | — |  |  | 5,201 |
Other 2016 restructuring programs | 589 |  |  | 77 |  |  | 212 |  |  | 878 |
2016 Manufacturing footprint realignment plan | 1,314 |  |  | 420 |  |  | 363 |  |  | 2,097 |
2014 Manufacturing footprint realignment plan | 687 |  |  | 68 |  |  | — |  |  | 755 |
Other restructuring programs (1) | 428 |  |  | (160 | ) |  | 96 |  |  | 364 |
Total restructuring charges | $ | 13,316 |  |  | $ | 803 |  |  | $ | 671 |  |  | $ | 14,790 |
(1) | Includes activity related to the 2017 Pyng Integration program and programs initiated in prior years that have been completed. The Company committed to the 2017 Pyng Integration program, which relates to the integration of Pyng Medical Corp. ("Pyng") into the Company, during the second quarter 2017, following the Company's acquisition of Pyng in April 2017.
| 2016
| Termination benefits |  | Facility closure and other exit costs |  | Contract termination costs |  | Total
| (Dollars in thousands)
Other 2016 restructuring programs | $ | 2,531 |  |  | $ | 12 |  |  | $ | 671 |  |  | $ | 3,214 |
2016 Manufacturing footprint realignment plan | 11,176 |  |  | 468 |  |  | 866 |  |  | 12,510 |
2014 Manufacturing footprint realignment plan | 81 |  |  | 38 |  |  | — |  |  | 119 |
Other restructuring programs(1) | (558 | ) |  | 398 |  |  | 188 |  |  | 28 |
Total restructuring charges | $ | 13,230 |  |  | $ | 916 |  |  | $ | 1,725 |  |  | $ | 15,871 |
Impairment charges | — |  |  | 43,356 |  |  | — |  |  | 43,356 |
Total restructuring and impairment charges | $ | 13,230 |  |  | $ | 44,272 |  |  | $ | 1,725 |  |  | $ | 59,227 |
(1) | Includes activity primarily related to programs initiated in 2015 that were associated with the reorganization of certain businesses and shared service center functions as well as the consolidation of certain facilities in North America. These programs have been completed.
| 2015
| Termination benefits |  | Facility closure and other exit costs |  | Contract termination costs |  | Total
| (Dollars in thousands)
2015 Restructuring programs | $ | 5,009 |  |  | $ | 295 |  |  | $ | 1,000 |  |  | $ | 6,304 |
2014 Manufacturing footprint realignment plan | 1,007 |  |  | 289 |  |  | 389 |  |  | 1,685 |
Other restructuring programs (1) | (194 | ) |  | 37 |  |  | (13 | ) |  | (170 | )
Total restructuring charges | $ | 5,822 |  |  | $ | 621 |  |  | $ | 1,376 |  |  | $ | 7,819 |
(1) Includes activity related to programs initiated, and substantially completed, in prior years. 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. Other exit costs include legal, outplacement and employee relocation costs and other employee-related costs. Contract termination costs include costs associated with terminating existing leases and distributor agreements. Restructuring Charges 2017 Vascular Solutions Integration Program During the first quarter 2017, the Company committed to a restructuring program related to the integration of Vascular Solutions into Teleflex. The program commenced in the first quarter 2017, and the Company expects the program to be substantially completed by the end of the second quarter 2018. The Company estimates that it will record aggregate pre-tax restructuring charges of $6.5 million to $8.0 million related to this program, of which, $5.5 million to $6.2 million will constitute termination benefits, and $1.0 million to $1.8 million will relate to other exit costs, including employee relocation and outplacement costs. Additionally, the Company expects to incur $2.5 million to $3.0 million of restructuring related charges, consisting primarily of retention bonuses offered to certain employees expected to remain with the Company after completion of the program. All of these charges will result in future cash outlays. As of December 31, 2017, the Company has a restructuring reserve of $2.1 million related to this program. 2017 EMEA Restructuring Program During the first quarter 2017, the Company committed to a restructuring program to centralize certain administrative functions in Europe. The program commenced in the second quarter 2017, and the Company expects the program to be substantially completed by the end of 2018. The Company estimates that it will record aggregate pre-tax restructuring charges of approximately $5.0 million related to this program, almost all of which constitute termination benefits, and all of which will result in future cash outlays. This represents a decrease as compared to the prior estimate of aggregate pre-tax restructuring charges of $7.1 million to $8.5 million as a result of a decrease in the headcount reduction initially contemplated under the program. As of December 31, 2017, the Company has a restructuring reserve of $4.9 million related to this program. 2016 Manufacturing Footprint Realignment Plan In 2016, the Company initiated a restructuring plan involving the relocation of certain manufacturing operations, the relocation and outsourcing of certain distribution operations and a related workforce reduction at certain of the Company's facilities (the “2016 Manufacturing Footprint Realignment Plan"). These actions commenced in the first quarter 2016 and are expected to be substantially completed by the end of 2018. The Company estimates that it will incur aggregate pre-tax restructuring and restructuring related charges in connection with the 2016 Manufacturing Footprint Realignment Plan of between approximately $34 million to $44 million, of which an estimated $27 million to $31 million are expected to result in future cash outlays. Most of these charges, and the related cash outlays, are expected to be made prior to the end of 2018. The following table provides a summary of the Company’s cost estimates by major type of expense associated with the 2016 Manufacturing Footprint Realignment Plan:
Type of expense | Total estimated amount expected to be incurred
Termination benefits | $14 million to $15 million
Other exit costs (1) | $2 million to $3 million
Restructuring charges | $16 million to $18 million
Restructuring related charges (2) | $18 million to $26 million
| $34 million to $44 million
(1) | Includes contract termination costs as well as facility closure and other exit costs (employee relocation costs, equipment relocation costs and outplacement).
(2) | Consists of accelerated depreciation and other costs directly related to the plan, primarily as a result of the transfer of manufacturing operations to new locations.
The following table summarizes the activity related to the 2016 Manufacturing Footprint Realignment Plan restructuring reserve:
| Termination benefits |  | Facility closure and other exit costs |  | Contract termination costs |  | Total
| (Dollars in thousands)
Balance at December 31, 2015 | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |
Subsequent accruals | 11,176 |  |  | 468 |  |  | 866 |  |  | 12,510 |
Cash payments | (3,220 | ) |  | (469 | ) |  | (95 | ) |  | (3,784 | )
Foreign currency translation | 179 |  |  | 1 |  |  | (11 | ) |  | 169 |
Balance at December 31, 2016 | 8,135 |  |  | — |  |  | 760 |  |  | 8,895 |
Subsequent accruals | 1,314 |  |  | 420 |  |  | 363 |  |  | 2,097 |
Cash payments | (2,096 | ) |  | (420 | ) |  | (798 | ) |  | (3,314 | )
Foreign currency translation | (57 | ) |  | — |  |  | 44 |  |  | (13 | )
Balance at December 31, 2017 | $ | 7,296 |  |  | $ | — |  |  | $ | 369 |  |  | $ | 7,665 |
For the years ended December 31, 2017 and 2016, the Company also incurred restructuring related costs of $8.3 million and $6.4 million, respectively, with respect to the 2016 Manufacturing Footprint Realignment Plan, the majority of which constituted accelerated depreciation and other costs, which primarily were recognized within cost of goods sold. As of December 31, 2017, the Company has incurred net aggregate restructuring expenses related to the 2016 Manufacturing Footprint Realignment Plan of $14.6 million. Additionally, as of December 31, 2017, the Company has incurred net aggregate accelerated depreciation and certain other costs in connection with the plan of $14.7 million, which were included in cost of goods sold. 2014 Manufacturing Footprint Realignment Plan In April 2014, the Company initiated a restructuring plan (the "2014 Manufacturing Footprint Realignment Plan") involving the consolidation of operations and a related reduction in workforce at certain facilities, and the relocation of manufacturing operations from certain higher-cost locations to existing lower-cost locations. These actions commenced in the second quarter 2014. During the fourth quarter 2017, the Company executed an agreement with an alternate provider for the development and supply of a component to be included in certain kits primarily sold by the Company’s Vascular and Anesthesia North America operating segments. The agreement will result in increased development costs, but is expected to reduce the cost of the component supply, once the supply becomes commercially available, as compared to costs incurred with respect to current suppliers. As a result, the Company revised its cost and timing estimates with respect to the 2014 Manufacturing Footprint Realignment Plan. The Company estimates that it will incur aggregate pre-tax charges in connection with the 2014 Manufacturing Footprint Realignment Plan of $46 million to $51 million, compared to the Company’s prior estimate of approximately $43 million to $48 million. The Company expects aggregate cash outlays associated with the plan to be in the range of $38 million to $43 million, compared to its prior estimate of $33 million to $38 million. Additionally, the Company continues to expect that it will incur $24 million to $30 million in aggregate capital expenditures under the plan. Most of these charges and cash outlays are expected to be incurred prior to 2020, and the Company expects, as a result of the changes described above, the program will now be substantially complete by the end of 2021, compared to its prior estimate of the second half of 2020. The following table provides a summary of the Company’s cost estimates by major type of expense associated with the 2014 Manufacturing Footprint Realignment Plan, which reflect the revised estimates:
Type of expense | Total estimated amount expected to be incurred
Termination benefits | $11 million to $12 million
Other exit costs (1) | $1 million to $2 million
Restructuring charges | $12 million to $14 million
Restructuring related charges (2) | $34 million to $37 million
| $46 million to $51 million
(1) | Includes contract termination costs as well as facility closure and other exit costs (employee relocation costs, equipment relocation costs and outplacement).
(2) | Consists of accelerated depreciation and other costs directly related to the plan, primarily as a result of the transfer of manufacturing operations to new locations.
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 GAAP. The following table summarizes the activity related to the 2014 Manufacturing Footprint Realignment Plan restructuring reserve:
| Termination benefits |  | Facility closure and other exit costs |  | Total
| (Dollars in thousands)
Balance at December 31, 2015 | $ | 7,447 |  |  | $ | — |  |  | $ | 7,447 |
Subsequent accruals | 81 |  |  | 38 |  |  | 119 |
Cash payments | (2,158 | ) |  | (38 | ) |  | (2,196 | )
Balance at December 31, 2016 | 5,370 |  |  | — |  |  | 5,370 |
Subsequent accruals | 687 |  |  | 68 |  |  | 755 |
Cash payments | (2,131 | ) |  | (68 | ) |  | (2,199 | )
Balance at December 31, 2017 | $ | 3,926 |  |  | $ | — |  |  | $ | 3,926 |
For the years ended December 31, 2017, 2016 and 2015, the Company reported restructuring related costs of $4.0 million, $8.5 million and $9.5 million, respectively, related to this plan within cost of goods sold. These costs related to accelerated depreciation and certain other costs, primarily for the transfer of manufacturing operations from the existing locations to the new locations in connection with the plan. As of December 31, 2017, the Company has incurred net aggregate restructuring expenses related to the plan of $11.8 million. Additionally, as of December 31, 2017, the Company has incurred net aggregate accelerated depreciation and certain other costs in connection with the plan of $26.9 million, which were included in cost of goods sold. 2016 Other Restructuring Programs During 2016, the Company commenced restructuring activities involving the consolidation of certain global administrative functions and manufacturing operations (the "Other 2016 Restructuring Programs"). The programs are expected to be substantially complete by the end of the first quarter 2018. The Company estimates that it will record aggregate pre-tax restructuring expenses of $3.8 million to $4.7 million related to these programs, which constitute termination benefits and contract termination costs that will result in cash outlays. Additionally, the Company expects to incur approximately $1.5 million of restructuring related costs, including accelerated depreciation and other costs directly related to these programs and anticipates that these costs will be recognized as cost of goods sold; the Company anticipates that approximately $1.0 million of this amount will result in cash outlays. As of December 31, 2017, the Company has a reserve of $0.7 million related to these programs. As each of these plans and programs progress, management will reevaluate the estimated expenses set forth above, and may revise its estimates, as appropriate, consistent with GAAP. Restructuring Charges by Segment Restructuring charges by reportable operating segment for the years ended December 31, 2017, 2016, and 2015 are set forth in the following table:
| 2017 |  | 2016 |  | 2015
| (Dollars in thousands)
Vascular North America | $ | 2,595 |  |  | $ | 5,843 |  |  | $ | 3,049 |
Interventional North America | 4,908 |  |  | 459 |  |  | 1,894 |
Anesthesia North America | 1,262 |  |  | 1,839 |  |  | 384 |
Surgical North America | — |  |  | 151 |  |  | 397 |
EMEA | 5,722 |  |  | 4,423 |  |  | 4 |
Asia | — |  |  | — |  |  | 313 |
OEM | — |  |  | 795 |  |  | 61 |
All other | 303 |  |  | 2,361 |  |  | 1,717 |
Total restructuring charges | $ | 14,790 |  |  | $ | 15,871 |  |  | $ | 7,819 |
Impairment Charges There were no impairment charges recorded for the years ended December 31, 2017 or 2015. In 2016, the Company recorded $43.4 million of impairment charges, including $41.0 million related to a discontinued IPR&D project and $2.4 million related to two properties that were sold during the first quarter of 2017.

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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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