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Restructuring Accruals

9 Months Ended

Sep. 30, 2019

Restructuring Accruals

Restructuring Accruals

6. Restructuring Accruals

Selected information related to the restructuring accruals for the three months ended September 30, 2019 and 2018 is as follows:


		Employee			Asset			Other			Total
		Costs			Impairment			Exit Costs			Restructuring
Balance at July 1, 2019		$	50		$			$	20		$	70
Charges			5			17			2			24
Write-down of assets to net realizable value						(17)						(17)
Net cash paid, principally severance and related benefits			(6)						(6)			(12)
Other, including foreign exchange translation									(1)			(1)
Balance at September 30, 2019		$	49		$	—		$	15		$	64


		Employee			Asset			Other			Total
		Costs			Impairment			Exit Costs			Restructuring
Balance at July 1, 2018		$	71		$			$	16		$	87
Net cash paid, principally severance and related benefits			(8)						(1)			(9)
Other, including foreign exchange translation			(1)						(2)			(3)
Balance at September 30, 2018		$	62		$	—		$	13		$	75

Selected information related to the restructuring accruals for the nine months ended September 30, 2019 and 2018 is as follows:


		Employee			Asset			Other			Total
		Costs			Impairment			Exit Costs			Restructuring
Balance at January 1, 2019		$	47		$			$	22		$	69
Charges			32			17			7			56
Write-down of assets to net realizable value						(17)						(17)
Net cash paid, principally severance and related benefits			(30)						(11)			(41)
Other, including foreign exchange translation									(3)			(3)
Balance at September 30, 2019		$	49		$	—		$	15		$	64


		Employee			Asset			Other			Total
		Costs			Impairment			Exit Costs			Restructuring
Balance at January 1, 2018		$	67		$			$	18		$	85
Charges			15			53			2			70
Write-down of assets to net realizable value						(53)						(53)
Net cash paid, principally severance and related benefits			(18)						(3)			(21)
Other, including foreign exchange translation			(2)						(4)			(6)
Balance at September 30, 2018		$	62		$	—		$	13		$	75

When a decision is made to take restructuring actions, the Company manages and accounts for them programmatically apart from the on-going operations of the business. Information related to major programs is presented separately while minor initiatives are presented on a combined basis. As of September 30, 2019 and 2018, no major restructuring programs were in effect.

In the three and nine months ended September 30, 2019, the Company implemented several discrete restructuring initiatives and recorded restructuring and other charges of $24 million and $56 million, respectively. These charges consisted of employee costs such as severance and benefit-related costs, write-down of assets and other exit costs primarily related to a severance program for certain salaried employees at the Company’s corporate and America’s headquarters and a furnace closure in the Americas. These restructuring charges were discrete actions and are expected to approximate the total cumulative costs for those actions as no significant additional costs are expected to be incurred. For the three months ended September 30, 2019, these charges were recorded to Other expense, net on the Condensed Consolidated Results of Operations. For the nine months ended September 30, 2019, these charges were recorded to

Selling and administrative expense ($2 million) and Other expense, net ($54 million) on the Condensed Consolidated Results of Operations. The Company expects that the majority of the remaining cash expenditures related to the accrued employee costs will be paid out by the end of 2019.

In the nine months ended September 30, 2018, the Company implemented several discrete restructuring initiatives and recorded restructuring, asset impairment and other charges of $70 million. These charges consisted of employee costs, write-down of assets and other exit costs primarily related to a plant closure in the Americas region. These restructuring charges were discrete actions and are expected to approximate the total cumulative costs for those actions as no significant additional costs are expected to be incurred. These restructuring actions primarily relate to capacity curtailments and the Company plans to reallocate the products produced to other facilities. These charges were recorded to Cost of goods sold ($5 million) and Other expense, net ($65 million) on the Condensed Consolidated Results of Operations. The Company expects that the majority of the remaining cash expenditures related to the above charges will be paid out by the end of 2019.

The Company’s decisions to curtail selected production capacity have resulted in write downs of certain long-lived assets to the extent their carrying value exceeded fair value or fair value less cost to sell. The Company classified the assumptions used to determine the fair value of the impaired assets in the period that the measurement was taken as Level 3 (third party appraisal) in the fair value hierarchy as set forth in the general accounting principles for fair value measurements. For the asset impairments recorded through September 30, 2019 and 2018, the remaining carrying value of the impaired assets was approximately $0 and $3 million, respectively.