11.	Restructuring

The Company incurred restructuring costs in both continuing and discontinued operations. The discussion in this note relates to the combination of both continuing and discontinued operations unless otherwise noted. Restructuring costs related to discontinued operations are recorded in discontinued operations within the Company’s Consolidated Condensed Statements of Earnings and are discussed in Note 12 Discontinued Operations in more detail.

In March of this year, the Company announced the 2014 Restructuring Plan related to eliminating underperforming operations, consolidating manufacturing facilities and improving efficiencies within the Company. The Company anticipates that the 2014 Restructuring Plan will impact several facilities and will generate cost savings estimated to be approximately $30 million per year, with incremental savings expected to be achieved over the next few years and the full benefit expected to be achieved after 2016. The Company also anticipates that the 2014 Restructuring Plan will include a reduction in headcount by approximately 300 employees, primarily direct and indirect manufacturing labor, and pre-tax charges of approximately $120 million to $130 million. In connection with the 2014 Restructuring Plan, less than 50 employees were terminated as of September 30, 2014 and limited savings were recognized by September 30, 2014.

The Company determined that certain long-lived assets, including land, buildings and certain pieces of equipment associated with the identified underperforming operations were impaired. As a result, the Company has reduced the carrying amounts of these assets to approximately $34.9 million, their aggregate respective fair values, which were determined based on independent market valuations for these assets.

For the three and nine months ended September 30, 2014, the Company recorded restructuring and other costs of $23.1 million and $88.8 million, respectively. The Company determined that this was the appropriate amount of costs to record in each period in accordance with GAAP and based on an internal review of the affected facilities and consultation with legal and other advisors. Included within the restructuring and other costs, the Company incurred $3.2 million for the nine months ended September 30, 2014, related to the 2014 proxy contest. The 2014 proxy contest costs recorded for the three months ended September 30, 2014, was not material.

The Company evaluates performance based on operating income of each segment before restructuring costs. The restructuring and other costs related to continuing operations are recorded in the Corporate & Other segment. The following table summarizes the restructuring and other costs by segment and discontinued operations for the three-and nine-month periods ended September 30, 2014 and 2013:

	Three Months Ended September 30,
(In thousands)	2014		2013
Flavors & Fragrances	$	20,064	$	4,167
Color		-		1,497
Corporate & Other		968		922

Total Continuing Operations	$	21,032	$	6,586

Discontinued Operations		2,071		-

Total Restructuring	$	23,103	$	6,586

	Nine Months Ended September 30,
(In thousands)	2014		2013
Flavors & Fragrances	$	74,115	$	18,657
Color		-		5,807
Corporate & Other		4,672		1,537

Total Continuing Operations	$	78,787	$	26,001

Discontinued Operations		10,017		-

Total Restructuring	$	88,804	$	26,001

Details of the restructuring and other costs recorded during the three and nine month periods ended September 30, 2014 are as follows:

(In thousands)	Three Months Ended September 30, 2014		Nine Months Ended September 30, 2014
Employee separation	$	1,033	$	14,611
Long-lived asset impairment		18,210		66,082
Intangibles impairment		-		1,049
Write-down of inventory		2,671		2,671
Gain on asset sales		-		(602	)
Other costs ⁽¹⁾		1,189		4,993

Total	$	23,103	$	88,804

⁽¹⁾

Other costs include decommissioning costs, professional services, personnel moving costs, other related costs and 2014 proxy contest costs.

The Company expects to incur approximately $12 million to $17 million of additional restructuring costs by the end of December 2014 and $20 million to $25 million of additional restructuring costs by the end of 2016, consisting primarily of employee separations, asset impairments, and other restructuring related costs. These estimates relate to both continuing operations and discontinued operations.

For the three- and nine-month periods ended September 30, 2013, the Company recorded restructuring costs of $6.6 million ($4.4 million after-tax) and $26.0 million ($18.5 million after-tax), respectively, related to the 2013 restructuring program to relocate the Flavors & Fragrances Group headquarters to Chicago, and to implement a profit improvement plan across all segments of the Company. Details of the restructuring expenses recorded in Corporate & Other segment are as follows:

Three months ended September 30, 2013

	Selling &			Cost of
(In thousands)	Administrative			Products Sold		Total
Employee separation	$	5,002		$	-	$	5,002
Long-lived asset impairment		220			-		220
Gain on asset sales		(3,019	)		-		(3,019	)
Write-down of inventory		-			545		545
Other costs⁽¹⁾		3,838			-		3,838

Total	$	6,041		$	545	$	6,586

Nine months ended September 30, 2013

	Selling &			Cost of
(In thousands)	Administrative			Products Sold		Total
Employee separation	$	16,342		$	-	$	16,342
Long-lived asset impairment		3,626			-		3,626
Gain on asset sales		(3,019	)		-		(3,019	)
Write-down of inventory		-			1,417		1,417
Other costs⁽¹⁾		7,635			-		7,635

Total	$	24,584		$	1,417	$	26,001

⁽¹⁾

Other costs include decommissioning, professional services, personnel (other than employee separations) and moving related costs.

The following table summarizes the accrual for the restructuring and other charges for the nine months ended September 30, 2014:

	Employee			Asset Related
(In thousands)	Separations			and Other			Total
Balance as of December 31, 2013	$	4,562		$	1,588		$	6,150
Restructuring and other costs		14,611			74,193			88,804
Gain on sale of assets		-			602			602
Cash spent		(4,812	)		(4,613	)		(9,425	)
Reduction of assets		-			(69,802	)		(69,802	)
Translation adjustment		(1,034	)		-			(1,034	)
Balance as of September 30, 2014	$	13,327		$	1,968		$	15,295