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Restructuring and Asset Impairments | 9 Months Ended
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Oct. 01, 2023
Restructuring and Related Activities [Abstract] |
Restructuring and Asset Impairments | Restructuring and Asset Impairments Due to its geographic footprint and the cost-competitive nature of its businesses, the Company is continually seeking more cost-effective means and structures to serve its customers and to respond to fundamental changes in its markets. As such, restructuring costs have been, and are expected to be, a recurring component of the Company’s operating costs. The amount of these costs can vary significantly from quarter to quarter and from year to year depending upon the scope, nature, and location of the restructuring activities. Following are the total restructuring and asset impairment charges, net of adjustments, recognized during the periods presented:
|  | Three Months Ended |  | Nine Months Ended
|  | October 1, 2023 |  | October 2, 2022 |  | October 1, 2023 |  | October 2, 2022
Restructuring and restructuring-related asset impairment charges |  | $ | 18,110 |  |  | $ | 20,652 |  |  | $ | 52,981 |  |  | $ | 33,262 |
Other asset impairments |  | — |  |  | — |  |  | — |  |  | 10,095 |
Restructuring/Asset impairment charges |  | $ | 18,110 |  |  | $ | 20,652 |  |  | $ | 52,981 |  |  | $ | 43,357 |
The table below sets forth restructuring and restructuring-related asset impairment charges by type incurred:
|  | Three Months Ended |  | Nine Months Ended
|  | October 1, 2023 |  | October 2, 2022 |  | October 1, 2023 |  | October 2, 2022
Severance and termination benefits |  | $ | 9,736 |  |  | $ | 9,265 |  |  | $ | 19,370 |  |  | $ | 13,578 |
Asset impairments |  | 6,123 |  |  | 3,301 |  |  | 26,122 |  |  | 4,533 |
Other costs |  | 2,251 |  |  | 8,086 |  |  | 7,489 |  |  | 15,151 |
Restructuring and restructuring-related asset impairment charges |  | $ | 18,110 |  |  | $ | 20,652 |  |  | $ | 52,981 |  |  | $ | 33,262 |
The table below sets forth restructuring and restructuring-related asset impairment charges by reportable segment:
|  | Three Months Ended |  | Nine Months Ended
|  | October 1, 2023 |  | October 2, 2022 |  | October 1, 2023 |  | October 2, 2022
Consumer Packaging |  | $ | 8,288 |  |  | $ | 4,350 |  |  | $ | 11,792 |  |  | $ | 8,529 |
Industrial Paper Packaging |  | 6,430 |  |  | 7,674 |  |  | 32,961 |  |  | 10,029 |
All Other |  | 1,766 |  |  | 18 |  |  | 5,875 |  |  | (399) |
Corporate |  | 1,626 |  |  | 8,610 |  |  | 2,353 |  |  | 15,103 |
Restructuring and restructuring-related asset impairment charges |  | $ | 18,110 |  |  | $ | 20,652 |  |  | $ | 52,981 |  |  | $ | 33,262 |
Restructuring and restructuring-related asset impairment charges are included in “Restructuring/Asset impairment charges” in the Company’s Condensed Consolidated Statements of Income. The following table sets forth the activity in the restructuring accrual included in “Accrued expenses and other” on the Company’s Condensed Consolidated Balance Sheets:
|  | Severance and Termination Benefits |  | Asset Impairments/ Disposal of Assets |  | Other Costs |  | Total
Accrual Activity |  |  |  |
Liability at December 31, 2022 |  | $ | 14,677 |  |  | $ | — |  |  | $ | 1,392 |  |  | $ | 16,069 |
2023 charges |  | 19,370 |  |  | 26,122 |  |  | 7,489 |  |  | 52,981 |
Cash payments |  | (19,552) |  |  | (166) |  |  | (6,291) |  |  | (26,009) |
Asset writedowns/disposals |  | — |  |  | (25,956) |  |  | — |  |  | (25,956) |
Foreign currency translation |  | (81) |  |  | — |  |  | 9 |  |  | (72) |
Liability at October 1, 2023 |  | $ | 14,414 |  |  | $ | — |  |  | $ | 2,599 |  |  | $ | 17,013 |
“Severance and Termination Benefits” during the first nine months of 2023 includes the cost of severance for approximately 300 employees whose positions were eliminated in conjunction with the Company’s ongoing organizational effectiveness efforts and severance related to the following plant closures: paper mills in Hutchinson, Kansas and Indonesia, part of the Industrial Paper Packaging segment; a metal packaging facility and a perimeter-of-the-store facility in the United States, both part of the Consumer Packaging segment; medical plastics facilities in the United States and United Kingdom, part of the All Other group of businesses; and severance related to the closures of several smaller operations. “Asset Impairments/Disposal of Assets” during the first nine months of 2023 consists primarily of asset impairment charges related to the closure of paper mills in Hutchinson, Kansas and Indonesia, a metal packaging facility and a perimeter-of-the-store facility in the United States, and medical plastics facilities in the United States and United Kingdom. “Other Costs” during the first nine months of 2023 consists primarily of consulting services, costs related to the closure of the Hutchinson, Kansas paper mill, and the cost of earlier plant closures, including equipment removal, utilities, plant security, property taxes and insurance. The Company expects to pay the majority of the remaining restructuring reserves by the end of 2023 using cash generated from operations. The Company also expects to recognize future additional charges totaling approximately $2,300 in connection with previously announced restructuring actions and believes that the majority of these charges will be incurred and paid by the end of 2023. The Company continually evaluates its cost structure, including its manufacturing capacity, and additional restructuring actions are likely to be undertaken. Other Asset Impairments Other asset impairment charges recognized during the nine-month period ended October 2, 2022 include net asset impairment charges totaling $9,165, resulting from the Company’s exit from its operations in Russia as a result of the ongoing Russia-Ukraine conflict. These operations consisted of two small tube and core plants in the Company’s Industrial Paper Packaging segment. The charges include $3,747 of cumulative translation adjustment losses that were reclassified from accumulated other comprehensive income upon completion of the Company’s exit from Russia on July 1, 2022. Fixed asset impairments totaling $930, were recognized in the nine-month period ended October 2, 2022, in the Company’s plastics foods operations, part of the Consumer Packaging segment. The assets were impaired as the value of their projected undiscounted cash flows was determined to no longer be sufficient to recover their carrying value. These impairment charges are included in “Restructuring/Asset impairment charges” in the Company’s Condensed Consolidated Statements of Income.

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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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