Restructuring Costs

12 Months Ended

Jan. 02, 2021

Restructuring and Related Activities [Abstract]

During 2020, the Company recorded restructuring costs of $1,118,000, representing severance costs of $659,000 for 34 employees in its Flow Control segment, $277,000 for 26 employees in its Industrial Processing segment, and $182,000 for four employees in its Material Handling segment. The Company also reduced its workforce by 21 employees in its Industrial Processing segment with no associated severance costs. The Company took these cost-containment actions to reduce future payroll-related overhead and operating costs in response to the slowdown in the global economy, largely driven by the COVID-19 pandemic.

During 2019, the Company experienced a significant decrease in revenue and operating results in its timber-harvesting product line included in its Industrial Processing segment, which was acquired in 2017 as part of its acquisition of the forest products business of NII FPG. Given the decline in this business, the Company undertook a restructuring plan in the fourth quarter of 2019 and incurred $192,000 of severance costs associated with the reduction of six employees in Canada.

In 2017, the Company constructed a 160,000 square foot manufacturing facility in the United States that integrated its Industrial Processing segment's U.S. and Swedish papermaking stock-preparation product lines into a single manufacturing facility to achieve economies of scale and greater efficiencies. As a result of the consolidation and integration of these facilities, the Company developed a restructuring plan totaling $1,920,000, primarily related to costs for the relocation of machinery and equipment and administrative offices, severance, and abandonment of leased facilities. As a result of this plan, the Company recorded restructuring charges of $203,000 in 2017 associated with severance costs for the reduction of four employees in the United States and six employees in Sweden. In 2018, the Company recorded additional restructuring costs of $1,717,000 related to this plan, including $1,318,000 primarily for the relocation of machinery and equipment and administrative offices, $454,000 associated with employee retention costs and abandonment of excess facility and other closure costs, and a reversal of $55,000 of severance costs no longer required.

The Company does not expect to incur additional charges related to the above restructuring plans. Restructuring costs are included in impairment and restructuring costs in the accompanying consolidated statement of income.

A summary of the changes in accrued restructuring costs included in other accrued expenses in the accompanying consolidated balance sheet, which are expected to be paid in 2021, are as follows:


(In thousands)	Severance		Relocation		Other (a)		Total
2020 Restructuring Plan
Provision	$	1,118	$	—	$	—	$	1,118
Usage	(1,052)		—		—		(1,052)
Currency translation	(5)		—		—		(5)
Balance at January 2, 2021	$	61	$	—	$	—	$	61

2019 Restructuring Plan
Provision	$	192	$	—	$	—	$	192
Usage	(109)		—		—		(109)
Currency translation	1		—		—		1
Balance at December 28, 2019	84		—		—		84
Usage	(90)		—		—		(90)
Currency translation	6		—		—		6
Balance at January 2, 2021	$	—	$	—	$	—	$	—

2017 Restructuring Plan
Balance at December 30, 2017	$	203	$	—	$	—	$	203
(Reversal) Provision	(55)		1,318		454		1,717
Usage	(77)		(1,315)		(448)		(1,840)
Currency translation	(8)		(3)		(6)		(17)
Balance at December 29, 2018	63		—		—		63
Usage	—		—		—		—
Balance at December 28, 2019	63		—		—		63
Usage	(3)		—		—		(3)
Balance at January 2, 2021	$	60	$	—	$	—	$	60

(a) Includes employee retention costs that are accrued ratably over the period through which employees must work to qualify for a payment, as well as facility closure and clean-up costs.